Randall W. Roth, University of Hawai'i Law School

Abstract

In 1884 Princess Bernice Pauahi Bishop, the last direct descendant of the Hawaiian monarch Kamehameha the Great, placed the bulk of her estate in charitable trust to establish and maintain "two schools, one for boys and one for girls, to be known as, and called the Kamehameha Schools." The land holdings of what came to be known as the Bishop Estate are so large that they have been described by the New York Times as "a feudal empire so vast that it could never be assembled in the modern world." For many years, however, Bishop Estate was "land-rich and cash-poor," generating just enough income to keep both schools operating. When Hawaii became the 50th state and jet travel made the islands into an accessible destination, the princess's trust quickly became the nation's wealthiest charity, with an endowment that the Wall Street Journal described as larger than Harvard's and Yale's combined. In 1984 a United States Supreme Court decision forced the trustees to sell some estate land that many years earlier had been made available to homeowners on long-term leases. Suddenly Bishop Estate was cash-rich, too--a windfall that seemed to bring out the worst in Hawaii's most powerful political leaders. A series of dramatic and often shocking events during the late 1990s shook the state's conservative power structure to its foundations, snowballing into what 60 Minutes called "the biggest story in Hawaii since Pearl Harbor," and The American Journalism Review described as "the kind of story that makes journalists salivate like hungry dogs." Federal judge Samuel P. King and law professor Randall W. Roth have brought the story to life in their book, BROKEN TRUST: Greed, Mismanagement & Political Manipulation at America's Largest Charitable Trust. Numerous legal issues form the core of this real-life drama.