Northwest Land Matters - Developments in Real Estate, Land Use, Environmental & Water Law in the Pacific NW

On April 12, 2012, Judge Martinez, U.S. District Court, Western District of Washington, issued a decision denying the National Wildlife Federation’s request for a preliminary injunction to halt the sale of flood insurance and floodplain map revisions in the Puget Sound stating that the NWF failed to demonstrate likely environmental harm absent the requested injunction.

[e]vidence that new flood insurance policies have been issued does not constitute proof that listed species are likely to suffer harm.”  He explained: “the issuance of flood insurance policies by itself does not cause jeopardy to listed species; it is the issuance of such policies in the context of a program that is implemented in a certain way that causes jeopardy.  

 -Judge Richard Martinez

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Development and conservation need not always be at odds.  The Pierce County Council recently approved Orton Junction, “a new model of development that contributes to the economic strength and livability of our cities and breaks the old habit of sprawling across the countryside.”

This agreement represents a model solution that provides for services and jobs in the Sumner area while also permanently protecting hundreds of acres of farmland and creating a ‘green wall’ to curb further growth in the valley.

Pierce County Executive Pat McCarthy

GordonDerr Partner Jay Derr provided strategic advice to the City of Sumner and property owners within the proposed conservation development over the past several years and led the final negotiations with Cascade Land Conservancy that culminated in a 7 Principles Agreement for agricultural lands conservation easements, transfer of development rights and sustainable community design and construction principles.  The City ends up with significant job and economic development opportunities in a new community center.  The local agricultural industry ends up with over 500 acres of agricultural land protected by permanent conservation easements—all based on private funds and market rate development.

With the September 23^rd implementation “deadline” less than two months away, many of the 122 local jurisdictions participating in the National Flood Insurance Program (NFIP) are moving ahead to take some type of action to respond to the Biological Opinion issued by the NOAA-National Marine Fisheries Service to FEMA Region X.  As many will recall, in that Biological Opinion, the NOAA-National Marine Fisheries Service directed FEMA to take action by September 23, 2011 to implement changes to the NFIP to protect endangered salmon and steelhead species and Orca whales.  FEMA has in turn looked to local jurisdictions to change their regulations to implement the more stringent floodplain development standards set forth in the Biological Opinion (Element 3 of the Reasonable and Prudent Alternative).

But this is not new or news.  What is new is that FEMA and NMFS are currently in the process of considering revisions to the Biological Opinion that are likely to address some of the many concerns leveled at the Biological Opinion since its issuance in September 2008.  

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Last week, Gov. Chris Gregoire signed into law the Foreclosure Fairness Act of 2011, a bill that gives homeowners working with housing counselors or attorneys the right to third-party mediation of foreclosures.  The Act is intended to help homeowners obtain loan modifications necessary to avoid foreclosure.  Washington is the third state to adopt a foreclosure-mediation program, after Nevada and Maryland.  Lawmakers are hopeful that an increase in the use of mediation will not only lead to a reduction in the total number of foreclosures, but also help to resolve hundreds of loan workouts that remain outstanding.  The new protections provided by the Act, however, are also likely to slow down the processing times for foreclosures.  If greater processing times increase the backlog of foreclosures, Washington could see delays in the recovery of its residential real estate market.   

A struggling economy has made the issue of co-tenancy clauses in leases more important than ever for both landlords and tenants. With the vacancy rate for strip malls at a national average of 10.9%, the country’s highest level in 20 years, co-tenancy clauses have proven to be a problematic concession for landlords and a valuable tool for tenants. Co-tenancy clauses provide retail tenants with remedies if one or more tenants in a shopping center fail to open or leave. Landlords are seeing co-tenancy rights exacerbate the financial strain caused by high vacancy rates, by allowing tenants of underperforming centers to pull out of their leases or demand discounts in rent.

When negotiating a co-tenancy clause on behalf of a landlord or tenant, consider the following key questions:

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A recent Washington Court of Appeals case provides a useful warning about missing some of the formalities required for a valid lease in Washington, but also shows a court willing to step in to save a defective lease, recognizing the potential unfairness in letting a party walk away from what everyone intended to be a binding agreement.

Washington law is unusually stringent in the formal steps required to create a valid lease.  Leases for a term over a year must be in the form of a “deed,” which in practical terms means that:

• the lease must be in writing; 
• the signatures (at least of the landlord) must be acknowledged by a notary, and 
• the parties must attach an adequate legal description to the lease.

Not surprisingly, in the real world landlords and tenants often run afoul of some of these requirements; however, this isn’t necessarily fatal for a lease.

In the Losh case, the parties attached the required legal description for the leased property to the lease, but the legal description was incomplete. The court found that the incomplete legal description rendered the lease invalid, but went on to enforce the lease anyway.  The court noted that the tenant had paid rent and generally acquiesced to the terms of the lease.

While cases like Losh may be comforting to a landlord or tenant trying to enforce a flawed lease, when the parties are preparing and signing a lease it is obviously safer to comply with all of the required formalities so that they don’t have to convince a court later to rescue the lease.