Specific Guidelines for Condo Ordered

Tenants Sued to Halt Construction

February 16, 2004 | Massachusetts Lawyers Weekly
By Lisa K. Bruno

Tenants of a housing complex being converted to a condominium were entitled to an order establishing the parameters for future construction work, a Housing Court judge has ruled.

The plaintiffs had sought a preliminary injunction, claiming that the construction and repairs being done interfered with their right to quiet enjoyment and amounted to an impermissible “condominium conversion” under Chapter 257 of the Acts of 1983.

Judge Dina E. Fein agreed and issued an order enjoining the specific conduct of which the plaintiffs had complained.

“The question is not whether the defendants are not permitted to make these improvements in an occupied building, but rather whether the tenants’ right to quiet enjoyment places any constraint on the way they go about making the improvements,” she said.

The 10-page decision is Chaisson, et al. v. Soda Creek Trading Corporation, Inc., et al., Lawyers Weekly No. 17-010-03.

Balancing Act

Joel H. Feldman of Springfield, who represented the plaintiffs, noted that the ruling is one of the first to be made under Chapter 527, the so-called condominium conversion law.

He said that while construction and improvements are frequently undertaken in tenanted buildings, the decision stood for the proposition that the work would not be performed without limits.

Feldman said the statute is detailed and its wording clear in its application not only to actual evictions undertaken in contemplation of a conversion, but also to any action by an owner which “substantially deprives” tenants of the “beneficial use” of the housing or “materially impairs” the “beneficial enjoyment” of the housing.

“The statute says don’t make it so that the living circumstances are so difficult that the tenants end up leaving,” he summed up.

Feldman observed that the judge approached the decision as a balance between the owner’s needs and the tenants’ rights, with such determinations being made on a case-by-case basis. Describing the property as a “massive construction site,” he pointed out that the present case was unusual in the level of work being undertaken and the amount of time in which it was being done.

One of the highlights of the decision from the tenants’ perspective, Feldman said, was the provision allowing them to refuse the landlord’s request to perform cosmetic upgrades within individual units.

While the ruling specifically stated that construction in a tenanted building is not absolutely prohibited, Feldman suggested prudence would dictate that work commence only once notice is given and the premises are vacated.

John E. Garber of Northampton, counsel for the defendants, said that while the covenant of quiet enjoyment is a well-established rule, the decision’s analysis under Chapter 527 covered new territory.

“The judge understood that it was a new owner with a resolve to fix the place and make it a good, sound building for current and future owners,” he said. “You do not want to discourage extensive repairs, but how do you draw the line? She drew the line down the middle.”

Garber described Chapter 527 as “unusual.” While he compared the statute’s prerequisites to the disclosure provisions mandated by the Securities and Exchange Commission, he said its requirements are not clearly spelled out.

“Exactly what must be stated in the required notice to tenants is less than clear,” Garber said. “The exact scope and timing of the tenants’ rights are murky and subject to dispute.” He added that little or no interpretive caselaw exists.

Remarking that the statute is not generally known because it is “tucked away” in the Public Acts, Garber pointed out it could have some “worrisome” effects.

“The consequences of a deficient notice are potentially dire, because Chapter 527 grants certain rights to the tenant in the unit itself – to remain in it for a set period of time and to have the opportunity to buy it, among others,” he explained.

Given the lack of guidance, in the present case the defendants agreed to work together with plaintiffs’ counsel in generating a new notice acceptable to all parties, Garber said.

Under Repair

The plaintiffs were residential tenants in a multi-unit complex in Northampton, known as “Old School Commons.” Soda Creek Trading Corp. acquired the property in July 2002 and transferred the property approximately a year later, ultimately to the defendant Emerald City Partners.

At all times in question, the property was managed by the defendant Rockwell Management.

During an initial inspection by Rockwell Management in July 2002, a number of conditions were identified as requiring repair, including roof leaks, defective plumbing fixtures, defective flooring, inadequate heat and electrical problems. The most serious conditions were those related to chronic roof leaks and drainage problems, with associated wood rot and water damage.

Construction work to repair the conditions was ongoing since February 2003. At the same time, work was performed to carry out cosmetic improvements, such as new paint and carpeting in the common areas, as well as discretionary systemic upgrades, such as central air conditioning.

The defendants had taken various steps to convert the units at the property to condominiums, including filing a master deed with the appropriate Registry of Deeds.

In their complaint, the plaintiffs alleged noisy and dirty construction work had been conducted as early as 7 a.m. on occasion, as well as into the evening, at times.

They maintained main entrance doors were left open and unguarded, and access to individual units had at times occurred without permission or notice. In addition, they complained that common hallways and elevators were partially obstructed on occasion.

The plaintiffs sought three forms of injunctive relief: notice comporting with the requirements of Chapter 527, substantive rights under the statute, and cessation of the activity which interfered with their right to quiet enjoyment and/or amounted to “condominium eviction” under the statute.

Tenants’ Harm

The plaintiffs claimed that the defendants’ activities at the property amounted to unlawful interference with their right to quiet enjoyment as defined under G.L.c. 186, §14. Fein agreed, noting that a landlord is liable for acts that substantially interfere with the tenancy or impair the character and value of the leased premises.

“Landlord caused or authorized noise may constitute interference with quiet enjoyment, as may the presence of ‘confusion, noise, dust and dirt’ resulting from construction work, justifying injunctive relief,” she wrote.

The plaintiffs also contended the defendants’ activities amounted to an impermissible “condominium eviction” under Chapter 527.

Observing that she was aware of no authority interpreting this provision of the statute, Fein looked to the plain language of the act. She concluded that the plaintiffs had a substantial likelihood of prevailing on their claim that the events complained of, such as loud and dirty construction work and unauthorized entry to their apartments, deprived them of the “beneficial enjoyment” of their housing.

Fein added that because of the conclusion that the plaintiffs were likely to prevail on their quiet enjoyment claim, the ultimate success of the condominium eviction clam was not determinative of her ruling.

Continuum of Urgency

In weighing the plaintiffs’ risk of harm against the defendants’ risk of harm resulting from an injunction, the defendants contended the work was necessary to repair substandard conditions. The plaintiffs argued it was discretionary and undertaken to enhance the market value of the individual units.

“The distinction between necessary maintenance of the property, on the one hand, and improvements to the property, on the other, is not sharp, but rather reflects a continuum of urgency,” Fein stated. “The law does not prohibit either absolutely, even in a fully tenanted building.”

She added that the “location of a particular activity along the continuum does, however, affect the balance of rights among the interested parties.” The more a condition affects health and safety issues, Fein explained, the more inconvenience must be tolerated by an occupant.

“[W]hile the defendants certainly have the right to improve and market these properties, their right to do so must be balanced against the right of those individuals residing there, to the quiet enjoyment of their homes,” she wrote.

The plaintiffs also maintained that the ongoing construction, with its extended hours and associated security and access issues, created a risk of irreparable harm. The defendants countered that money damages would serve to compensate the plaintiffs for any future wrongful conduct and that they would endeavor in the future to avoid any inconvenience to the plaintiffs.

Fein disagreed that the possibility of recovering money damages negated the need for injunctive relief, remarking that “maintaining a minimally acceptable quality of life is preferable to compensating an individual for a foreseeable and preventable degradation of that quality.”

She added that the complaints raised by the plaintiffs went “beyond quality of life issues, and create the risk of serious irreparable injury such as third party criminal activity or escape hazards.”

With respect to the defendants’ future efforts to minimize inconvenience to the tenants, Fein remarked that the balancing test inherent in the issuance of a preliminary injunction obviated the need to measure the risk of future infringements by the defendants.

“[T]o the extent that the risk of the defendants engaging in behavior which will interfere with the plaintiffs’ right to quiet enjoyment in the future is less, so is the burden on the defendants posed by this order; to the extent that the risk is more, so is the need for the order to avoid irreparable harm to the plaintiffs,” she explained.

Fein rejected the defendants’ allegation that they would be harmed should future construction at the property be enjoined, finding their argument unsupported by specifics. She went on to note that while the court’s order established parameters for future construction, it did not significantly limit that work.

The judge issued an order specifying which conduct was enjoined in the performance of the construction work at the property, including working before 8:30 a.m. or after 5:30 p.m., working on weekends, securing main entrance doors at all times, ensuring access to exits and common areas, and requiring notice for entry to individual units.

In her ruling, Fein found that the plaintiffs’ request for notice comporting with the requirements of Chapter 527 had been rendered moot by the defendants drafting, post-hearing, a new notice and submitting it to plaintiff’s counsel for comment.

The parties were invited to request a further ruling should discussions not lead to re-issuance of a notice acceptable to all parties.

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