Lake v. Woodcreek Homeowners Ass'n, 59211-4-I.

• Citation: 142 Wn. App. 356,174 P.3d 1224
• Decision Date: 31 December 2007
• Docket Number: No. 59211-4-I.,59211-4-I.
• Court: Court of Appeals of Washington
• Parties: Sandra LAKE, individually, Appellant, v. WOODCREEK HOMEOWNERS ASSOCIATION, a Washington homeowners association; Glen R. Clausing, a single man, Respondents.

174 P.3d 1224

142 Wn. App. 356

Sandra LAKE, individually, Appellant, v. WOODCREEK HOMEOWNERS ASSOCIATION, a Washington homeowners association; Glen R. Clausing, a single man, Respondents.

No. 59211-4-I.

Court of Appeals of Washington, Division 1.

December 31, 2007.

Marianne Kathryn Jones, Attorney at Law, Mona Kathleen McPhee, Jones Law Group PLLC, Bellevue, WA, Christopher Ian Brain, Tousley Brain Stephens PLLC, Seattle, WA, for Appellant.

Scott Michael Barbara, Johnson Andrews & Skinner PS, Seattle, WA, Charles Edward Watts, Attorney at Law, Bellevue, WA, for Respondents.

ELLINGTON, J.

¶ 1 With permission of the condominium board of directors, a unit owner built a second story "bonus room" above his garage. This both converted common area (air space) into apartment area, and created new common area (e.g., walls), thus changing the character of the property and altering all of the owners' undivided percentage interests in the common areas. Under the condominium declaration, such a change requires unanimous consent of all owners, which was not obtained. The board's authorization of the bonus room was therefore improper. We reverse the superior court and remand for further proceedings.

BACKGROUND

¶ 2 Glen Clausing and Sandra Lake own townhomes in Woodcreek Condominiums in Bellevue. When the development was built in 1972 through 1977, the developer offered an option with certain types of units for a bonus room—an extra room above the garage.¹ Some purchasers opted for bonus rooms at the time of construction. As required by law, at the end of construction, the developer declared the value of each unit and the total value of the development. The ratio of each unit's value to the total determined each owner's undivided percentage interest in the common areas.

¶ 3 Clausing's unit is one of those for which a bonus room was originally an option. In mid-May 2004, Clausing obtained approval from the board of directors of the Woodcreek Homeowners Association to build a bonus room. When construction began, Lake, who lives across from Clausing, realized the new room would affect her natural light and block part of her territorial view. She complained immediately to two board members and at the next board meeting a few days later, she formally objected. The board refused to withdraw its approval. Within four weeks, the bonus room's siding was up and the roof was complete.

¶ 4 Lake consulted her attorney, who wrote to the board on August 26 contending the board's action was unauthorized and seeking withdrawal of the board's approval and removal of the new room. The board again refused.

¶ 5 As of September 1, the board increased Clausing's dues to cover the common expenses associated with the new structure.

¶ 6 In December 2005, Lake filed this action against the Woodcreek Homeowners Association and Clausing. She moved for partial summary judgment, arguing that approval and construction of a bonus room violated the Horizontal Property Regimes Act, chapter 64.32 RCW, and the condominium declaration. Clausing and Woodcreek also moved for summary judgment, contending the Board's action was proper. The trial court agreed with Clausing and Woodcreek, awarded fees and costs against Lake, and dismissed. Lake appeals.

ANALYSIS

¶ 7 The usual standard for summary judgment applies.²

¶ 8 "All condominiums are statutorily created."³ The rights and duties of condominium unit owners are not the same as those of real property owners at common law, and are instead determined by the governing statutes, the condominium declaration, and the bylaws of the condominium association.⁴ In exchange for the benefits of association with other owners, condominium purchasers "`give up a certain degree of freedom of choice which [they] might otherwise enjoy in separate, privately owned property.'"⁵ The Horizontal Property Regimes Act, Washington's first law authorizing condominiums, governs the Woodcreek development.⁶ All owners are subject to the condominium's declaration and bylaws.⁷

¶ 9 The Woodcreek declaration provides that any alteration in the percentage of undivided interest in common areas must be unanimously approved by all owners:

[A]n amendment altering the value of the property and of each apartment and the percentage of undivided interest in the common areas and facilities shall require the unanimous written consent of all apartment owners.⁸

The principal question here is whether building the bonus room converted common area into private apartment area or created new common area. If so, it changed each owner's percentage of undivided interest in the common areas without the necessary consent.⁹

¶ 10 The Woodcreek declaration defines apartments, common areas, and limited common areas. Apartments are the area bounded by the interior surfaces of the walls. Common areas include, in addition to those defined in RCW 64.32.010:¹⁰ "[A]ll areas not expressly described as part of the individual residence apartments or as limited common area"¹¹ as well as "roofs, walls, foundations, studding, joists, beams, supports, main walls, ... pipes, conduits and wire, ... and all other structural parts of the buildings to the interior surfaces of the apartments' perimeter walls, floors, ceilings, windows and doors[,] ... [t]he green belt areas, other yard areas, all garden areas .... [and][a]ll other parts of the property necessary or convenient to its existence, maintenance, safety and use not otherwise classified."¹² Limited common areas, assigned to each unit, include a patio/garden, attic storage, a crawl space, an entrance area, and a driveway parking area.

¶ 11 Air space above an apartment unit is not part of the apartment and is not limited common area. It is a part of the property necessary to its existence and is not otherwise classified. Air space is therefore common area. By eliminating the air space above his garage, Clausing converted common area to apartment area and thus put common area to his sole benefit.

¶ 12 A somewhat similar situation arose in Bogomolov v. Lake Villas Condominium Association of Apartment Owners.¹³ There, 60 percent of owners approved an amendment to Lake Villas' declaration allowing for construction of a new boat dock with slips to be leased to individual apartment owners. Because the dock was to be constructed on common area shore lands, renting slips to individual owners would convert common area into limited common area.¹⁴ As some individuals would gain exclusive use of what were previously common areas, the conversion would necessarily change the value of individual owners' percentage interest in the common areas. Consequently, the court held that approval of 100 percent of the owners was required to authorize the change;

[I]t is the fact that newly constructed common areas proposed here are in reality being converted to limited common areas under the proposal that requires the values stated in the Declaration to be changed. Values set forth in the Declaration are to accurately reflect the unit and limited common area interests of the owners. That change requires unanimous consent of the owners.¹⁵

The result is the same here.¹⁶ Clausing gained individual use of what was previously common area. As a result, the common area interests, and thus unit values, were altered. Woodcreek's declaration requires unanimous agreement of all owners for this type of change.

¶ 13 Clausing and Woodcreek argue that common area interests did not change because unit value determines percentage interest in common areas, and the developer did not tie unit values to bonus rooms. It may be true that the developer's declared values did not reflect a consistent difference based on the presence or absence of a bonus room, but what the developer considered in declaring the unit values and ownership percentages is irrelevant. Once the declaration is final, the values and percentages are fixed. They are subject to change only by unanimous vote, and converting common area to apartment area necessarily changes them. Clausing also argues that the board approved bonus rooms without challenge seven times previously, but erroneous past practice does not enlarge the board's authority.

¶ 14 Clausing and Woodcreek next contend the bonus room was properly authorized under section 12 of the declaration, which requires approval of only 51 percent of owners to combine and subdivide apartment units. But section 12 permits combining or subdividing areas of like quality, such as apartments and apartments.¹⁷ Such combinations and subdivisions do not change the total ownership interests in the property, they merely realign them. Section 12 does not authorize combining areas of different ownership quality, such as common areas and apartments.

¶ 15 Clausing and Woodcreek contend that such a combination of unlike areas was permitted in McLendon v. Snowblaze Recreational Club Owners Association.¹⁸ There, a condominium association board leased a common storage area to the owner of an adjacent unit, who planned to convert the area into a bedroom. The declaration required 60 percent of the owners in the building to approve the "subdivision o[r] combination or both, of any apartment or apartments or of the common areas, or any parts ther[e]of, and the means for accomplishing such subdivision or combination or both."¹⁹ McLendon argued that the declaration required unanimous approval to combine an apartment with common area. Division III of this court rejected his argument on the ground that the unanimous approval section "control[led] amendment of the entire declaration. It [did] not address the question before us: voting requirements for combining a common area and an apartment."²⁰

¶ 16 The court's opinion does not quote the portion of the declaration relied upon by McLendon. But if it is similar to the Woodcreek declaration requiring unanimous approval for changes to the value of the units or the owners' undivided interest in the common areas, we...