They say you can’t cheat an honest man, but Hawaii’s second highest court recently ruled that a man who fell victim to fraud while trying to cheat the government has a right to recover his losses.
In a February 28, 2008 ruling, the three judges on Hawaii’s Intermediate Court of Appeals decided that Volcano resident Ron Ober had been defrauded by former Honolulu realtor and well-known pro-se litigator Eric Aaron Lighter in a complex series of transactions a decade ago.
Ober said last week that he now hopes to quickly reclaim his 5,000 square foot dream home, now a Volcano bed & breakfast, that Lighter took from him in 1996.
Lighter is currently facing federal charges in an unrelated California case, where he is accused of conspiracy to defraud the government, wire fraud, blackmail and witness tampering stemming from alleged involvement in preparing and filing false tax returns on behalf of a San Francisco Bay Area psychiatrist and his wife, and then fraudulently grabbing personal control of their family trust.
In 2003, Lighter pleaded “no contest” to theft in a Hawaii case involving similar fraud allegations, but those charges were erased from his record as a result of a “deferred acceptance” deal with prosecutors.
According to the Intermediate Court’s summary of the case, Ober’s problems began when he became entangled with organizations proclaiming theories of individual sovereignty and opposing the federal income tax as unconstitutional. After attending a seminar preaching the right of independence from government, Ober wrote to Hawaii County officials and announced his belief that he was not required to obtain building permits in order to proceed with construction of a new five bedroom home intended for use as a B&B.
In his letter to the county, Ober wrote: "Since forcing someone to do something against his will always violates constitutional rights, then all rules, regulations, codes and ordinances that use the words 'must' and 'shall' are always voluntary even though they may appear mandatory to the general public.”
"I was real excited," Ober later explained. "I was reading all this sovereignty crap, common law stuff. I wanted to stand on my rights just once."
In a relatively rapid sequence of events, Ober was cited for building without a permit, ordered to stop work on the house, sued by a neighbor, and then arrested and jailed for contempt of court for failing to comply with a preliminary injunction.
Ober, afraid of additional jail time because of his refusal to apply for building permits and the possible loss of his home as a result of his neighbor’s lawsuit, was referred to Lighter, who claimed considerable experience going to court to defend against similar legal attacks. Lighter said he could protect against a court judgement that could result in loss of Ober’s property for a $10,000 fee. He described himself as “better and more capable than any of the overpaid real attorneys because he was not subject to the same rules as were licensed attorneys.”
However, as a non-lawyer, Lighter said he could not go to court to block the lawsuits unless the property was put in his name. Lighter assured Ober, and an attorney who had set up a private trust to hold title to the home, that the property would be returned whenever they wanted. Finally, Ober agreed and signed the house over to Lighter. In return, he received two promissory notes secured by “Air Rights and other Developer’s Development Rights in the Hawaiian Colony Hotel Project”.
The two men colluded to make it appear the property had been sold to Lighter, who would then use his arsenal of unorthodox techniques to paralyze the court and block attempts to seize the home.
Unknown to Ober, the promissory notes were worthless. A court had previously declared that the supposed “air rights” did not exist, according to the appeals court decision, and any residual rights would have disappeared when the First Hawaiian Bank foreclosed on the Hawaiian Colony years ago. When Ober began to worry that he was being cheated, he asked for the property to be returned and Lighter refused, later retaliating by making public evidence of their illegal deal.
Ober eventually sued to get his house back. In an initial trial, Ober was awarded monetary damages but Lighter was allowed to keep the house. Both men appealed the ruling, setting the stage for the Intermediate Court’s decision.
The court concluded that Lighter enticed Ober into signing over title to his property by claiming to be more effective than an attorney, and by falsely promising that he would return the property at any time on request.
“Even if Ober’s motive for entering into the transaction was to evade the laws regarding building permits or was otherwise improper, that does not mean that Lighter was free to defraud Ober of his property in these circumstances,” the court said.
Mark Pitcavage, a historian who has studied right-wing extremism in America, said in a 2000 interview that people like Ober who completely distrust the government and other authorities are vulnerable to this type of fraud, and are resistant to warnings because they reject any sort of formal authority and don’t trust the normal sources of such warnings.
[Case No. 26964, Intermediate Court of Appeals, decided February 28, 2008.]
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