[WSBARP] cooperative housing

[Rob Wilson-Hoss]

          In a cooperative housing context, the members own shares in the
entity which owns the real property; they do not own the real property. But
they are also tenants of the entity that owns the real property. As tenants
of the cooperative association, do they fall under the Residential Landlord
Tenant Act? The governing documents of all coops I have seen all provide for
various processes for termination of stock ownership and lease rights, but
none relates particularly to the requirements of the RLTA. You default,
there is notice and an opportunity to cure; you don't cure, you lose your
rights under the Agreement. I know that Stevens Housing Co-Op v. Guiffre, 89
Wash App 1067, discussed a process that used a 3-day notice, but it did not
address the underlying issue about the RLTA. And Firth V. Lu, 146 Wash 2d
608, has dictum in it that calls the members shareholder-tenants, says that
occupants are tenants,  and rules that the member has no real property
rights in the co-op's real property, but it also says, "As a matter of law,
the agreement between the Lus and Firths did not, and could not, convey
realty as such or any interest in realty." Well, a tenancy is an interest in
realty. 

 

          I kind of think that the sale by one owner to another owner is not
of an interest in real property (especially after Firth v. Lu), but the
relationship between the buyer and the owner of the property is like a
tenancy and is not one of the exceptions in the RLTA. But the lease
agreement is for over a year, and that makes it subject to the statute of
frauds. Typically, these are not recorded. The minority opinion in Firth v.
Lu points this out, in a discussion about a different matter. So, the
statute of frauds should apply. When you have a residential lease that  is
covered by the  statute of frauds but does not comply with it, it usually
doesn't matter in the termination context anyway because of part
performance. 

 

          The new Deskbook says that enforcement by termination is by the
mechanism established in the documents, which should be, default, notice (60
days as an example), cancelling membership certificate, and termination of
lease. Then, if necessary, eviction proceedings. It does not mention the
RLTA; the eviction proceeding used in Stevens Housing was unlawful detainer.


 

          What is unresolved for me in all of that is the essential nature
of a co-op. The co-op has the right to terminate for nonpayment, but also
for un-co-operative like behavior of all sorts. I guess this is analogous to
a lease where the landlord has the right to terminate for certain behaviors;
in a co-op the behavior rules are just more extensive and intrusive than
with an ordinary residential lease. First, if the RLTA applies, then how
would it be different from a termination under the co-op's governing
documents, in terms of the effect to the co-op? And second, if the
termination process under the governing documents is used, then do we
immediately go to unlawful detainer to eject, or is there something else to
this?

 

          Sorry, I don't do enough landlord-tenant law to understand all of
it.   

 

          Anyone have any thoughts?

 

          Thanks. Enjoy the sunshine. 

 

Rob 

 

Robert D. Wilson-Hoss 
Hoss & Wilson-Hoss, LLP 
236 West Birch Street 
Shelton, WA 98584 
360 426-2999

www.hossandwilson-hoss.com
 <mailto:rob at hctc.com> rob at hctc.com

 

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