Nate Prudhon v. R. Thoreson Homes, Llc

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IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON
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R. THORESON HOMES, LLC, a N.)
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Washington Limited Liability Company, -u in
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No. 74434-8-1 >
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Respondent, rn
DIVISION ONE C.4D
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V.
NATE PRUDHON, PUBLISHED OPINION
Appellant. FILED: December 12, 2016
SPEARMAN, J. — In Seattle, a landlord may only evict a tenant if he or she
has "just cause" as provided in the Just Cause Eviction Ordinance (JCEO).
Seattle Municipal Code (SMC) § 22.206.160. Under the ordinance, "just cause"
exists if the landlord "elects to sell" a rental property as that term is defined in the
ordinance. Here, the landlord, relying on the "elects to sell" provision, gave the
tenant notice of just cause for eviction after she had already sold the home. The
issue is whether the landlord may properly invoke the "elects to sell" provision
when the rental property was already sold with the tenant in place. We conclude
the "elects to sell" just cause provision applies only to the prospective sale of a
rental property. Because there was no just cause for eviction in this case, the trial
court's order granting unlawful detainer was in error. We reverse.
No. 74434-8-1/2
FACTS
Nate Prudhon leased a single-family home in Seattle from Denise and
Robert Burnside (Burnsides). After a one year lease expired at the end of June
2012, the tenancy reverted to month-to-month. Prudhon continued to reside at
the house. On or about April 2, 2015, the Burnsides entered into a purchase and
sale agreement with Blueprint Capital Services, LLC, who assigned the
agreement to R. Thoreson Homes, LLC. As part of the purchase and sale
agreement, the Burnsides agreed to issue a notice terminating Prudhon's
tenancy.1 Shortly after agreeing to sell the house, the Burnsides served Prudhon
with a notice to terminate the tenancy. It stated that "[t]he owner elects to sell a
single-family dwelling unit and gives the tenant at least sixty (60) days written
notice prior to the date set for vacating . ." Clerk's Paper (CP) at 113. On April
11, 2015, the Burnsides transferred the house to R. Thoreson Homes, LLC.
Prudhon made a complaint to the City of Seattle, Department of Planning
and Development (DPD). On April 16, 2015, DPD issued a Notice of Violation
(NOV) to the Burnsides. The NOV found that the Burnsides violated the Seattle
Just Cause Eviction Ordinance (JCEO), and ordered them to rescind the notice
to terminate tenancy. As the new owner, R. Thoreson Homes, LLC (Owners)
contested the NOV by requesting a Director's review. On May 15, 2015, the DPD
issued a Director's Order finding that the Owners violated the JCEO. Still, the
Owners did not rescind the notice of termination. They instead filed suit against
1 At oral argument, the Owner acknowledged that the Burnsides agreed to issue a notice
terminating Prudhon's tenancy as part of the purchase and sale agreement.
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the City of Seattle (City) and Prudhon for declaratory and injunctive relief on June
11, 2015. CP at 182. Then on July 23, 2015, the Owners filed a complaint for
unlawful detainer and requested a show cause hearing. The trial court granted
unlawful detainer on December 3, 2015. A writ of restitution was entered on
December 11, 2015. Prudhon moved for reconsideration and to stay the writ of
restitution which the trial court denied. The trial court entered a judgment against
Prudhon for $17,725.46 in attorney fees and costs. Prudhon appeals.
DISCUSSION
Prudhon argues that the "elects to sell" notice terminating his tenancy was
invalid under the JCEO because it was issued after the Burnsides sold the
property. Prudhon's interpretation of the JCEO requires landlords to provide
notice of termination before entering an agreement to sell the rental property.
The Owner argues that the JCEO "elects to sell" provision unambiguously
permits a landlord to terminate a tenancy after a rental property has been sold.
Interpretation of a statute presents a question of law reviewed de novo.
Ruvalcaba v. Kwang Ho Baek, 175 Wn.2d 1,6, 282 P.3d 1083 (2012). Courts
interpret local ordinances the same as statutes. Sleasman v. City of Lacey, 159
Wash. 2d 639, 643, 151 P.3d 990 (2007). The court's primary duty in interpreting a
statute is to "discern and implement the intent of the legislature." State v. J.P.,
149 Wash. 2d 444, 450, 69 P.3d 318 (2003) (quoting Nat'l Elec. Contractors Ass'n v.
Riveland, 138 Wash. 2d 9, 19, 978 P.2d 481 (1999)). We begin with the statute's
plain meaning. Id. We discern plain meaning from the ordinary meaning of the
language, related provisions in the statute, and the statutory scheme as a whole.
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No. 74434-8-1/4
State, Dep't of Ecology V. Campbell & Gwinn, LLC, 146 Wash. 2d 1, 11, 43 P.3d 4,
10 (2002). The plain meaning is "derived from what the Legislature has said in its
enactments, but that meaning is discerned from all that the Legislature has said
in the statute and related statutes which disclose legislative intent about the
provision in question." Id. A statute is unambiguous where the plain language is
susceptible to only one reasonable reading. J.P., 149 Wash. 2d at 450 (citing State
v. Wilson, 125 Wash. 2d 212, 217, 883 P.2d 320 (1994)).
In Seattle, a landlord cannot evict, or attempt to evict, a residential tenant
without just cause. Former SEATTLE MUN. CODE 22.206.160(C) (2011). The
landlord must provide a termination notice stating the reason for the termination
and facts supporting that reason. Former SMC 22.206.160(C)(3). There is just
cause for eviction if the owner elects to sell the rental property:
The owner elects to sell a single-family dwelling unit and nives the
tenant at least 60 days' written notice prior to the date set for
vacating. . . . For the purposes of this Section 22.206.160, an
owner "elects to sell" when the owner makes reasonable attempts
to sell the dwelling within 30 days after the tenant has vacated,
including, at a minimum, listing it for sale at a reasonable price with
a realty agency or advertising it for sale at a reasonable price in a
newspaper of general circulation. There shall be a rebuttable
presumption that the owner did not intend to sell the unit if:
(1) Within 30 days after the tenant has vacated, the owner does not
list the single-family dwelling unit for sale at a reasonable price with
a realty agency or advertise it for sale at a reasonable price in a
newspaper of general circulation, or
(2) Within 90 days after the date the tenant vacated or the date the
property was listed for sale, whichever is later, the owner withdraws
the rental unit from the market, rents the unit to someone other than
the former tenant, or otherwise indicates that the owner does not
intend to sell the unit;
Former SMC 22.206.160(C)(1)(f). (Emphasis added.)
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The parties dispute whether the Burnsides can "elect to sell" property that
they already sold. Prudhon adopts the City's interpretation of the ordinance,
which is that "elects to sell" applies to owners who intend to sell, and have not
already sold, the property. CP at 37. The Owner argues that "elects to sell"
includes an owner who intends to sell or has already sold the property.
To determine whether the plain language of "elects to sell" encompasses
property that was already sold, we begin with its ordinary meaning. The
ordinance defines "elects to sell" as "when the owner makes reasonable attempts
to sell the dwelling within 30 days after the tenant has vacated . Former SMC
22.206.160(C)(1)(f). The Owner argues that this definition merely provides an
end date by which there must be attempts to sell, and therefore does not
preclude the prior sale of property. "Elects to sell" is defined by an owner's
activities after the tenant vacates, such as listing the property for sale with a
realty agency or in a newspaper. These are relevant only to the prospective sale
of property. The provision also employs phrases oriented toward future action: an
owner "elects" to sell, "attempts" to sell, and "intends" to sell after the tenant
vacates pursuant to just cause notice. While the ordinance may not expressly
preclude a prior sale, neither does it contemplate a prior sale. The ordinance
definition supports Prudhon's interpretation of the statute because it defines
"elects to sell" with prospective action: attempting to sell after the tenant has
vacated.
Related provisions and Seattle's statutory scheme further elucidate the
plain meaning of this ordinance. The JCEO provides just cause for eviction under
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a variety of circumstances. There is just cause for eviction to allow an owner or
his or her family to occupy the property. SMC 22.206.160(C)(1)(e). There is also
just cause for an eviction if an owner seeks to do substantial rehabilitation or
demolish the rental property, but only if the owner obtains a tenant relocation
license that assists low-income tenants displaced by development. SMC
22.206.160(C)(1)(h)(i); SMC 22.210.020(B). The "elects to sell" just cause
provision allows an owner to place a rental home on the market without a tenant
in place. Former SMC 22.206.160(C)(1)(f). However, there is no just cause to
evict simply because a new owner acquires the property.
We harmonize related provisions in a statute whenever possible. Davis v.
Cox, 183 Wash. 2d 269, 283, 351 P.3d 862 (2015) (citing State v. Hirschfelder, 170
Wash. 2d 536, 543, 242 P.3d 876 (2010)). The Owner argues that SMC
22.206.160(C)(1)(f)(2) is inconsistent with an interpretation of "elects to sell" that
requires the tenant to have vacated the property before an owner makes
reasonable attempts to sell it. That section creates a rebuttable presumption that
the owner did not intend to sell the property if:
Within 90 days after the date the tenant vacated or the date
the property was listed for sale, whichever is later, the owner
withdraws the rental unit from the market, rents the unit to
someone other than the former tenant, or otherwise indicates
that the owner does not intend to sell the unit[.]
The Owner argues that if an owner cannot make any attempts to sell until the
tenant has vacated the property, then the provision would be meaningless
because 90 days after the property is listed for sale is always later than 90 days
after the tenant has vacated the property. Thus, the Owner contends that to
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harmonize the provisions we must read SMC 22.206.160(C)(1)(f) as permitting
the sale to occur before the tenant vacates the property.
The argument is unpersuasive. First, whether an owner may list a property
for sale prior to it being vacated by the tenant is not at issue in this case. The
issue before us is whether an owner may enter into an agreement to sell the
property and, as part of the agreement, agree to evict the tenant using the "elects
to sell" provision of the JCEO. Second, the Owner's analysis is flawed because it
is improperly limited to an alleged inconsistency in a single section of the JCEO.
It fails to reconcile other related provisions and the statutory scheme of the JCEO
as a whole. Viewing the ordinance as a whole, the Owner's interpretation of
"elects to sell" allows developers to frustrate Seattle's tenant protection scheme
and the tenant relocation license requirement. The statutory scheme confirms
that the provision's plain language is not reasonably susceptible to the
interpretation proposed by the Owner.
We do not defer to an agency's interpretation of an unambiguous statute.
Brown v. City of Seattle, 117 Wash. App. 781, 72 P.3d 764 (2003), as corrected
(Aug. 14, 2003). But here, the City's interpretation of the ordinance is consistent
with the unambiguous language defining "elects to sell." The Director's Order
clearly explains that this interpretation enables the policy goals of the JCEO:
Once a property is sold with the tenant in place, it is up to the new
owner to determine whether to keep the tenant or whether there is
just cause to terminate their tenancy. If, as is apparently the case
here, the new owner wants to tear down the housing and build
replacement housing, then the new owner is required to go through
the Tenant Relocation Assistance License prior to giving the tenant
notice to move; the tenant relocation process provides the just
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cause. The owner cannot rely on an "intent to sell" just cause
designed to allow an owner to make a property more saleable by
offering it without a tenant in place, if the property has already been
sold with a tenant in residence. And, to allow this just cause to be
applied in these circumstances would enable the new owner to
evade obligations under the Tenant Relocation Assistance
Ordinance and thereby frustrate the intent of that ordinance.
CP at 39.
The Owners deployed the "elect to sell" just cause provision to their
benefit: they wished to take possession of the property tenant-free. At oral
argument, the Owners concede that they bargained for this result, as the
Burnsides agreed to issue the just cause notice to terminate in the purchase and
sale agreement. The Owner cannot circumvent the requirements of the JCEO
and Tenant Relocation licensing scheme by invoking "elects to sell" just cause
where the property was sold with a tenant in place. We conclude that this
provision does not provide just cause for eviction where, prior to issuing a notice
to terminate, an owner contracts to sell rental property with a tenant in place.
Thus, the Owner's notice terminating tenancy violated the JCEO and the trial
court erred when it granted an unlawful detainer on the basis of an invalid notice.
Attorney Fees
The trial court awarded the Owner $17,725.46 in attorney fees and costs.
Prudhon requests that we reverse the trial court's judgment granting attorney
fees and costs to the Owner and award him attorney fees and costs as the
prevailing party. A prevailing party may recover attorney fees authorized by
statute, equitable principles, or agreement between the parties. Landberq v.
Carlson, 108 Wash. App. 749, 758, 33 P.3d 406 (2001). If such fees are allowable
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at trial, the prevailing party may recover fees on appeal as well. RAP 18.1. Here,
the lease agreement between the parties provided for attorney fees. As the
prevailing party, Prudhon is entitled to reasonable fees and costs incurred in the
proceedings below and on appeal.
Reverse.
WE CONCUR:
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