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Joe McCarthy, Chair of Stoel Rives' Real Estate and Construction group, combines a deep understanding of real estate, partnership, and tax law with over thirty years’ experience handling complex projects. He is a trusted advisor on the development, financing, and operations of affordable, condominium, mixed-use, multi-family, ownership, planned community projects. He provides counsel and advocacy relating to acquisition, construction, diligence, joint ventures, leasing, management, operations, partnerships, and project finance.

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Washington’s legislators had their eye on common interest communities (CICs) during the 2023 regular session, which ended on April 23, 2023. Three bills relating to or affecting CICs become effective on July 23, 2023. One became effective immediately. Here is a brief summary of the new laws.

HB 1337 – Accessory Dwelling Units. This bill amends the Growth Management Act to require cities and counties to allow accessory dwelling units (ADUs) within urban growth areas. It contains numerous requirements and exceptions. From a CIC developer’s perspective, the following requirements are important.

  • The city or county must allow at least two ADUs in any zone where single-family homes are allowed.
  • The city or county may not require the owner of the lot to reside in or occupy any unit on the lot.
  • The city or county may not prohibit the sale or conveyance of a condominium unit independently of a principal unit solely on the ground that the condominium unit was originally built as an ADU.

Many local ADU ordinances require the owner of the property to reside in one of the units. Some require common ownership of the units. Even without such restrictions, some have questioned the legality of separately selling an ADU and a principal residence since it would convert the “accessory” unit into a “principal” unit under the land use ordinance. This bill eliminates those issues by prohibiting cities or counties from requiring owner occupancy and by forcing cities and counties to allow the sale of ADU condominium units. The new law prohibits developers and homeowners from imposing any prohibition or restriction on ADUs that the city or county would be prohibited from imposing. (This does not invalidate existing CCRS.)

The Washington Supreme Court recently published an opinion that appears to invalidate any homebuyer warranty that requires the buyer to file suit in less than six years. In Tadych v. Noble Ridge Construction, Inc., the owners of a custom home sued their builder for breach of warranty three years after occupying the home. Their