[No. 59211-4-I. Division One. December 31, 2007.]
[1] Condominiums Property Rights Scope In General. The rights and duties of condominium unit owners are governed by statute, the condominium declaration, the condominium association by-laws, and any valid amendments of the declaration and by-laws. In exchange for the benefits of associating with other owners, each owner gives up a certain degree of freedom of choice that might otherwise be enjoyed if separate, privately owned property were involved. [2] Condominiums Common Areas What Constitutes Air Space Above Apartment. Air space above a condominium apartment unit is common area if, under applicable statutes, declarations, and by-laws, the space is neither part of the apartment nor a limited common area. [3] Condominiums Common Areas Conversion to Personal Area Validity In General. A condominium apartment unit owner's conversion of common area to apartment area for the unit owner's sole benefit must be made consistently with applicable statutes, declarations, and by-laws. [4] Condominiums Common Areas Conversion to Personal Area Unanimous Approval Necessity. Where a condominium declaration provides that any alteration in the percentage of undivided interest in common areas must be unanimously approved by all unit owners, an individual apartment unit owner may not convert a common area to apartment area for the owner's sole benefit without unanimous approval. [5] Condominiums Unit Values Ownership Percentages Final Declaration Effect. Once the unit values and ownership percentages of a condominium development have been finally declared, they are fixed and may not be changed except as provided by the declaration and/or condominium by-laws. [6] Condominiums Associations Authority Exceeding Authority Past Practice Effect. The authority of a condominium owners association's board of directors cannot be enlarged by erroneous past practices; i.e., a board decision that violates a condominium declaration or an association by-law is not entitled to support by virtue of the fact that the board has made the same decision in similar past circumstances without objection. [7] Condominiums Combining or Subdividing Units Areas of Different Ownership Quality Apartments and Common Areas Condominium Declaration. A condominium declaration allowing unit owners to combine and subdivide apartment units does not authorize unit owners to combine areas of different ownership quality, such as apartments and common areas. [8] Condominiums Combining or Subdividing Units Areas of Different Ownership Quality Apartments and Common Areas Statutory Provisions. RCW 64.32.090(10), which allows for subdividing condominium apartments, combining apartments with apartments, or combining common areas with other common areas, does not allow for combining areas of different ownership quality, such as apartments and common areas. [9] Condominiums Common Areas Increase Due to Personal Area Expansion Unanimous Approval Necessity. Where a condominium declaration provides that any alteration in the percentage of undivided interest in common areas must be unanimously approved by all unit owners, any construction of new private area that creates new common area, which thereby increases common expenses, necessarily results in a change in the undivided interests in the property and requires unanimous approval. [10] Condominiums Associations Authority Exceeding Authority Effect. Where a condominium owners association's board of directors exceeds its authority in making a decision, the decision may be voided. [11] Equity Laches What Constitutes. Laches is an implied waiver arising from knowledge of existing conditions and acquiescence in them. [12] Equity Laches Elements In General. Laches will bar a claim or cause of action if (1) the plaintiff was aware or should have been aware of the facts constituting the claim or cause of action, (2) the plaintiff's commencement of the action was unreasonably delayed, and (3) the defendant is damaged by the delay. [13] Equity Laches Elements Prejudice Burden of Proof. A defendant claiming that the plaintiff's claim or action is barred by laches has the burden of showing whether and to what extent he or she has been prejudiced. [14] Condominiums Use Restrictions Judicial Enforcement Timeliness Laches. Laches will not bar an action to void a decision by a condominium owners association's board of directors to approve a unit owner's construction project after the project has begun if the plaintiff received late notice of the project, making it practically impossible to obtain an injunction before significant expenditures on the project were made, and the plaintiff reasonably sought relief by other means before filing the action. [15] Specific Performance Delay Building Restriction. A reasonable delay in filing suit for specific performance of a building restriction is not fatal to the action if the delay results from a desire to procure compliance by means other than litigation. APPELWICK, C.J., concurs by separate opinion. Nature of Action: A condominium unit owner sought a determination that the approval and construction of a "bonus room" by another unit owner violated the Horizontal Property Regimes Act and the condominium declaration. Superior Court: The Superior Court for King County, No. 05-2-39460-9, Douglass A. North, J., on November 22, 2006, entered a summary judgment in favor of the defendants. Court of Appeals: Holding that, under applicable laws and rules, the "bonus room" could not be constructed without the unanimous consent of all unit owners, the court reverses the judgment and remands the case for further proceedings. Marianne K. Jones- and Mona K. McPhee- (of Jones Law Group, PLLC) and Christopher I. Brain (of Tousley Brain Stephens, PLLC), for appellant. Scott M. Barbara- (of Johnson Andrews & Skinner, PS), for respondent Woodcreek Homeowners Association. Charles E. Watts- (of Oseran Hahn Spring Straight & Watts, PS), for respondent Glen R. Clausing. Ά1 ELLINGTON, J. 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 Ά2 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 rooman extra room above the garage. Ά3 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. Ά4 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. Ά5 As of September 1, the board increased Clausing's dues to cover the common expenses associated with the new structure. Ά6 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 Ά7 The usual standard for summary judgment applies. [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. 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. Ά10 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: Ά11 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. Ά12 A somewhat similar situation arose in Bogomolov v. Lake Villas Condominium Ass'n of Apartment Owners. [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. The result is the same here. Ά13 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. Ά15 Clausing and Woodcreek contend that such a combination of unlike areas was permitted in McLendon v. Snowblaze Recreational Club Owners Ass'n. Ά16 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 must disagree with the McLendon court. The declaration provision permitting combinations and subdivisions and its governing authority, RCW 64.32.090(10), Ά18 To cover the new expenses, the board increased Clausing's dues. Woodcreek contends the holding in Keller invalidates Clausing's dues increase, not the authorization to build. Ά20 Alternatively, Clausing notes that we may affirm on any proper ground, whether or not considered by the trial court, and contends summary judgment was justified by laches, estoppel, or waiver. Ά23 We reverse summary judgment in favor of Clausing and Woodcreek, reverse the award of fees and costs against Lake, and remand for further proceedings consistent with this opinion. APPELWICK, C.J., and COLEMAN, J., concur. Ά24 APPELWICK, C.J. (concurring) I fully concur with the majority opinion. I write to emphasize additional reasoning for the result. Ά25 First, a condominium is real property. That real property interest includes an ownership interest in, right to share in, and an easement to use the common areas and facilities. RCW 64.32.030, .040, .050(4). Further, common areas shall remain undivided and any covenant to the contrary is void. RCW 64.32.050(3). According to the declaration here, the common areas include everything not an apartment or designated limited common area. Ά26 When construction on the units was complete, any optional bonus room shown on the plans that had not been constructed was not within an apartment. It was also not designated as limited common area. Therefore it was common area. Later enclosing this common area to add a bonus room onto an adjacent apartment is a taking of a common area interest owned by all members of the condominium. This may not be done without the consent of all owners. Ά27 It is precisely for this reason that State v. McLendon was wrongly decided. 84 Wn. App. 629, 929 P.2d 1140 (1997). McLendon allowed the combination of a common area storage shed with an apartment on less than a unanimous vote under RCW 64.32.090(10) (authorizing the declaration to provide combining or dividing apartments, common areas and limited common areas on less than unanimous vote of owners). This statute and section 12 of the declaration must be read to apply only to combining or dividing like-kind properties. Otherwise, the other owners are deprived of a portion of their real property ownership interest in common areas without consent, let alone compensation. Ά28 Further, I would hold that the addition of a room at the expense of common area necessarily increases the value of that apartment and of the condominium as a whole. It also necessarily changes the ownership interests of all owners relative to one another. This in turn requires amendment to the declaration. Unanimous consent of the owners is required for amending the declaration. RCW 64.32.090(13). Ά29 If the additional room was built on new footings off the end of a one story building, eliminating a prized common area garden and blocking the exclusive view of the sound for other owners, the facts would tug more at the emotions. But the loss of real property interests are just as real on these facts, where the additional room is built on a second story of a townhouse condominium above a garage, blocking light. These real property interests cannot be taken. Consent of all of the owners is required. For these reasons and the reasons stated by the majority, I concur.