Just days after Maui County’s Bill 9 was signed into law, the first legal challenge has been filed, marking the beginning of what many anticipated would be a series of court actions related to the bill.
According to public reporting, the lawsuit was filed on December 19, 2025, in Hawaii’s Second Circuit Court by owners of units at Kaʻanapali Royal, a property that has historically operated short-term rentals within apartment zoning. The case names Maui County as the defendant.
In summary, the complaint challenges Bill 9’s phase-out of short-term rental use in apartment-zoned properties and alleges that the new law establishes an unconstitutional taking of property rights without just compensation. The filing references decades of lawful operation, prior County land-use interpretations, and reliance on zoning and regulatory frameworks that permitted short-term rental use.
Vested Rights at the Center of the Challenge
The legal theory outlined in the lawsuit centers on vested rights, a concept in land-use law that protects existing lawful uses from being eliminated without due process or compensation. Many apartment-zoned short-term rentals affected by Bill 9 have operated for decades under County guidelines, approvals, and enforcement practices.
This issue has been raised repeatedly in prior discussions surrounding Bill 9 and reflects concerns voiced by legal experts that removing long-established property uses could expose the County to constitutional challenges.
Existing Legal Precedent in Hawaiʻi
There is also recent legal precedent in Hawaiʻi related to vested rights. In 2022, a federal judge in Honolulu blocked enforcement of a law that would have banned 30- to 89-day rentals in certain residential zones, ruling that forcing property owners to abandon long-standing lawful uses would likely violate constitutional protections.
That ruling cited state law protections for existing uses and reinforced the legal principle that government cannot retroactively eliminate lawful property rights without compensation.
What This Means Moving Forward
Bill 9, which was signed into law on December 15, 2025, establishes a staggered sunset for apartment-zoned short-term rentals, with enforcement beginning January 1, 2029, in West Maui, and January 1, 2031, in other affected districts. The law does not apply to hotel-resort zoned properties.
At this stage, the filing of the lawsuit does not change the law’s current status, and no court rulings or injunctions have been issued. However, the case confirms that legal challenges are no longer theoretical and may play a role in shaping how, when, or whether portions of Bill 9 are ultimately enforced.
As with most land-use and constitutional litigation, the legal process is expected to unfold over time. Additional lawsuits or motions may follow as implementation approaches.
We will continue to monitor developments and provide updates as more information becomes available.
With Aloha,
This Bill 9 Maui Real Estate update represents our opinion based on available information and should not be considered financial or legal advice.
Interested in learning more about Bill 9? You can read our other updates here:
- Bill 9 Update: Timeline, Impact, and What Maui Property Owners Should Expect (July 2025; General explanation of Bill 9 and FAQs)
- Bill 9 Update: Possible Path to Re-zoning from Apartment to Hotel/Resort (September 2025; Expected Timeline of Bill 9 and formation of the Temporary Investigative Group (TIG), and what they’re looking at)
- Bill 9 Update: New Hotel Zones Proposed to Protect Vacation Rentals (October 2025; TIG Recommendations including new Hotel Zones H3 & H4 and which properties they recommend to be rezoned to H3 & H4)
- Bill 9 Update: Bill 9 Passed, What Happens Next (December 2025; Bill 9 Signed into Law, FAQs for Buyers & Sellers)
- THIS POST: Bill 9 Legal Update: First Lawsuit Filed (December 2025; Details about the first lawsuit filed on Bill 9)
- Bill 9 Update: New Hotel Zoning Advances to Planning Commissions (January 2026; The first significant implementation step tied to Bill 9: H3 & H4 Hotel Zones Advance to Planning Commission)
