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.

Owners sued the association and Ridpath Revival, LLC, contending that the second declaration amendment was invalid because it was adopted without the consent of 90% of the voting power of the unit owners and without the vote of “the owner of each unit particularly affected.” RCW 64.34.264(2) states that “No action to challenge the validity of an amendment adopted by the association pursuant to this section may be brought more than one year after the amendment is recorded.” The lawsuit was brought more than one year after RCW 64.34.264(2)’s one-year statute of limitations.

The court determined that a challenge to an amendment which is void at its inception (void abnitio) is not time-barred by the RCW 64.34.264(2) statute of limitations. The court held that the second amendment was void at its inception because it changed voting interests of all the owners without the approval of all the owners and, thus, was not adopted, in the parlance of RCW 64.34.264(2), “pursuant to this section”. The court did not expressly hold that the second amendment was invalid because it did not receive votes constituting a minimum of 90% of the total voting power of the association. The court noted that the certificate attached to the second declaration stating that sufficient votes were obtained was insufficient, in itself, to overcome declarations by several unit owners indicating they did not approve the change.

The Ridpath Tower court broadly interprets the phrase, “the owner of each unit particularly affected.” The words “particularly affected” could be construed to mean an owner who is treated differently from other owners. In this case all of the owners were treated the same, not differently, when their voting interests were uniformly reduced and, thus, no one owner was particularly affected.

The court noted that Mr. Jeffreys had been convicted on a series of federal fraud charges unrelated to the second amendment. The judge’s apparent familiarity with Mr. Jeffries did not justify a reversal where the issue wasn’t raised at the trial court level and the judge’s comments did “not show actual or potential bias against…” Ridpath Revival, LLC.

About Brian P. McLean

BRIAN P. McLEAN is an attorney and shareholder at Leahy McLean Fjelstad in Seattle, Washington. He concentrates his practice in the area of community association law. He received his law and undergraduate degrees from Seattle University, where he was a member of Law Review, chair of the law school’s Moot Court Board, and commencement speaker for his graduating class. Brian speaks and writes frequently about community association issues, is a member of the Washington State Bar Association, and is a former board member of the Washington State Chapter of the Community Associations Institute (WSCAI) where he served as president from 2009 - 2010. He served previously as chair of WSCAI’s Legislative Action Committee, where he worked with state legislators to enact mandatory reserve study legislation in Washington State. Brian is former lead singer, guitarist, and songwriter for the now defunct Pacific Northwest band the Acetones.
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