It’s Here. Washington State’s Common Interest Ownership Act

It’s Here. Washington State’s Common Interest Ownership Act
by Brian P. McLean

Senate Bill (SB) 5263 – the Washington State Uniform Common Interest Ownership Act – was introduced on January 16, 2015, in the State Legislature and referred to the Financial Institutions & Insurance Committee. The sponsors are Senators Pedersen, Benton, Mullet, Fraser, Roach, Hobbs, Rivers, and Fain.

You can find a copy of the bill at: http://app.leg.wa.gov/billinfo/summary.aspx?bill=5263&year=2015.

The bill introduces a number of changes to how condominium and homeowner associations, cooperatives, and other types of common interest communities will operate.

LET US HEREBY RESOLVE, to Elect Board Members

LET US HEREBY RESOLVE, to Elect Board Members
By Brian P. McLean, JD, CCAL

Most associations don’t have a good written election policy. Granted, the association’s original articles of incorporation and bylaws may take perfunctory stabs at describing when elections take place, or whether board members must be owners, or the über-complex staggering of director terms, but other than these perfunctory stabs at clarity one cannot expect the articles and bylaws to tell us anything other than the obvious: owners elect board members. An association should have a good election policy that Continue reading LET US HEREBY RESOLVE, to Elect Board Members

Purity of Bloodline Rule for Condo Boards

Purity of Bloodline Rule for Condo Boards

by Brian P. McLean

According to the Onion, a satirical online magazine and by their own admission, “America’s Finest News Source,” a condo association in Florida has adopted “strict rules of peerage mandat[ing] that children of the five presiding condo board members must marry into one another’s households….”

Reasonable? Unreasonable? Why should a condo board work any differently from a monarchy?

Questions to ponder. Find the article here.

Club Envy of Spokane – The Statute of Limitations Disappearing Act

Club Envy of Spokane, LLC v. The Ridpath Tower Condominium Association, 31913-0-III (Wn. App. Nov 18, 2014)

The Ridpath Tower Condominium Association, by and through its president Greg Jeffreys, executed a second amendment that divided a unit spanning twelve floors, into three units, including two roof top units, lowered each association member’s voting rights from 5.263 percent to 4.762 percent, and converted some common elements to private ownership. Ridpath Revival, LLC, purchased units the two roof top units.

The Ridpath Tower declaration required that a minimum of 90% of the total voting interests held by the owners was required to adopt a general amendment. Additionally, RCW 64.34.264(4) requires the approval of “the owner of each unit particularly affected” for any amendment that increases the number of units, changes the boundaries of a unit, the allocated interests of a unit, or the uses to which any unit is restricted.  The majority of owners wanted to develop the condominium into low-rent, micro-apartments. Ridpath Revival, LLC, the owner of two roof-top units created by the second amendment, wanted to develop the units into a luxury hotel. Continue reading Club Envy of Spokane – The Statute of Limitations Disappearing Act

Judge C.C. Bridgewater – In Memoriam

ccbridgewater
C.C. Bridgewater

Judge C. C. Bridgewater died July 20, 2014.

We will miss him.

He was a philosopher, a statesman, a husband, a father, a grandfather, a family man. He was my friend. We will miss his kindness, his opinions, his thoughtful observations on life.

We will miss his love of people, his grin, his love of life.

We will miss him.

 

Beacon Residential v. Skidmore (California Case)

This is a big deal for new homeowners and California construction defect law, brought to you in part by my friend Steven Weil of Berding & Weil:

Building on substantial case law and the common law principles on which it is based, we hold that an architect owes a duty of care to future homeowners in the design of a residential building where, as here, the architect is a principal architect on the project—that is, the architect, in providing professional design services, is not subordinate to other design professionals. The duty of care extends to such architects even when they do not actually build the project or exercise ultimate control over construction. Accordingly, we affirm the judgment of the Court of Appeal.

Beacon Residential Cmty. Ass’n v. Skidmore, Owings & Merrill LLP, S208173, 2014 WL 2988058 (Cal. July 3, 2014).

“As California goes, so goes the nation.” Prof. Edgar Dykstra.

Casey v. Sudden Valley, Budgets v. Assessments

Casey v. Sudden Valley Community Assn, No. 70329-3-I (Wn. App. May 27, 2014)

In many associations, a board adopts a budget, the board sends a summary of the budget to the owners, and the owners ratify the budget. This practice is consistent with RCW 64.38.025(3) – the Washington Act that applies to non-condominium homeowner associations. The provision requires a board to submit a proposed budget to the members of the association for a vote at a meeting. Under this statute, the budget is ratified unless a majority or percentage specified in the governing documents reject the budget.

The typical budget summary includes any proposed assessment increases. If the budget is ratified, then the association presumably has the authority to increase assessments. RCW 64.38’s ratification provision is clearly modeled after the Washington Condominium Act.

In Casey v. Sudden Valley, Division One held that owners may ratify a budget that requires an increase in assessments while separately rejecting an increase in assessments. To get to that conclusion the Court determined that the budget summary referenced in RCW 64.38 relates only to capital reserves – a mistaken interpretation of changes to Legislation made in recent years considering that the statute required budget summaries be sent to owners before the reserve study language was added.

The Sudden Valley court essentially held that an owner-ratified RCW 64.38 budget that includes an increase in assessments is irrelevant if the governing documents require a separate vote on assessment increases and the owners, by separate vote, reject the increase. In such a case a board may unilaterally amend the budget without owner approval.

Judge Quinn-Brintnall – In Memoriam

Judge Christine Quinn-Brintnall died last week. The court’s press release is here: http://www.courts.wa.gov/newsinfo/?fa=newsinfo.pressdetail&newsid=2710

I worked for Judge Quinn-Brintnall for about eight months after she defeated Governor Locke’s appointee (whom I also worked for). She was a former prosecuting attorney for Pierce County. She scheduled a going away lunch on my last day at the Washington State Court of Appeals Div. II, the day of the Nisqually quake. Although the quake hit the appeals building like a semi, we had the lunch anyway.

She was a fine boss and she died too soon (age 62).

Law Firm Move

Our Kirkland office is moving to Seattle on June 1, 2014. Our new address will be

901 Fifth Avenue, Suite 820, Seattle, WA 98164-1005.

We are maintaining our Eastside telephone number, (425) 889-8191, and adding a new Seattle line, (206) 403-1933.

This might explain in part why I’ve been so quiet…

Wilkinson v. Chiwawa Communities Association

Wilkinson v. Chiwawa Communities Association, No. 86870-1 (Wash. Apr. 17, 2014)

The Washington State Supreme Court has held that the Chiwawa Communities Association, a planned residential community in Chelan County comprised of permanent and vacation residents, improperly adopted a declaration amendment prohibiting rental of homes for less than 30 days. The majority opinion and two dissents are 49 pages.