(a) This chapter shall not apply to owners or lessees of property who build or improve residential or farm buildings or structures on property for their own use, or for use by their grandparents, parents, siblings, or children, and who do not offer the buildings or structures for sale or lease; provided that:

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Terms Used In Hawaii Revised Statutes 444-2.5

  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Board: means the contractors license board. See Hawaii Revised Statutes 444-1
  • county: includes the city and county of Honolulu. See Hawaii Revised Statutes 1-22
  • Department: means the department of commerce and consumer affairs. See Hawaii Revised Statutes 444-1
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Sale: means any arrangement between two or more persons as a result of which there is, or is to be, a transfer of property for a consideration. See Hawaii Revised Statutes 444-1
(1) To qualify for an exemption under this section, the owner or lessee shall register for the exemption as provided in section 444-9.1;
(2) The exemption under this section shall not apply to electrical or plumbing work that must be performed only by persons or entities licensed in accordance with this chapter, unless the owner or lessee of the property is licensed for such work under chapter 448E;
(3) An owner or lessee exempted under this section shall:

(A) Supervise the construction activity on the exempt buildings or structures;
(B) Hire subcontractors appropriately licensed under this chapter to perform any part of the construction activity for which a license is required;
(C) Ensure that any electrical or plumbing work is performed by persons and entities appropriately licensed under this chapter or chapter 448E;
(D) Deduct Federal Insurance Contributions Act and withholding taxes and provide workers’ compensation insurance for persons working on the construction activity who are not licensed under this chapter or chapter 448E and who shall be considered employees of the owner or lessee; and
(E) Ensure that the construction activity complies with all applicable laws, ordinances, building codes, and zoning regulations;
(4) Until completion of the construction activity, an owner or lessee exempted under this section shall make available the following records for immediate inspection upon request by the department:

(A) A copy of the building permit application;
(B) A copy of the issued building permit;
(C) Copies of all contracts with the names of all persons who performed or are performing work on the exempt buildings and structures; and
(D) Proof of payment to all persons contracted to work on the exempt buildings and structures; and
(5) Upon completion of the construction activity, an owner or lessee exempted under this section shall keep and maintain the records identified in paragraph (4) for a period of three years from completion of the construction activity and shall make the records available for inspection within seven business days upon request by the department.
(b) Proof of the sale or lease, or offering for sale or lease, of the structure within one year after completion shall be prima facie evidence that the construction or improvement of the structure was undertaken for the purpose of sale or lease; provided that this subsection shall not apply to:

(1) Residential properties sold or leased to employees of the owner or lessee;
(2) Construction or improvements performed pursuant to an approved building permit where the estimated valuation of work to be performed, as reflected in the building permit, is less than $10,000; or
(3) Any sale or lease caused by an eligible unforeseen hardship as determined by the board pursuant to subsection (c).
(c) The board shall determine the eligibility of an unforeseen hardship claimed by an owner under subsection (b); provided that an alleged unforeseen hardship shall not be deemed eligible if the board determines that the construction or improvement of the structure was undertaken for the purpose of sale or lease. An exemption for an unforeseen hardship shall not be denied solely because of lack of completion, as the term is defined in subsection (e). An owner seeking a determination of eligibility of an unforeseen hardship shall:

(1) Be in compliance with the requirements set forth in the disclosure statement required to be provided under section 444-9.1; and
(2) Submit a written application to the board at any time prior to selling, leasing, or offering to sell or lease the property describing the nature of the applicant’s unforeseen hardship. The application shall include supporting documentation detailing the hardship, such as:

(A) Evidence of receipt of unemployment compensation;
(B) Tax returns;
(C) Medical records;
(D) Bank statements;
(E) Divorce decrees ordering sale of property;
(F) Mortgage default letters; or
(G) Bankruptcy filings.

The board shall communicate its determination to the owner in writing within ninety days of receiving a completed application under this subsection.

(d) Any owner or lessee of property found to have violated this section shall not be permitted to engage in any activities pursuant to this section or to register under section 444-9.1 for a period of three years. There is a rebuttable presumption that an owner or lessee has violated this section when the owner or lessee obtains an exemption from the licensing requirements of § 444-9 more than once in two years.
(e) For the purposes of this section, “completion” means the date of final inspection approval by the county.
(f) An owner or lessee exempted under this section shall not be eligible to recover from the contractors recovery fund.
(g) This section shall not apply to agricultural buildings, structures, or appurtenances thereto that do not require a building permit or are exempt from the building code.

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