Washington Real Estate Law Blog : Washington Real Estate Lawyer & Attorney : Dickson Steinacker Law Firm : WA HOA, Building & Zoning Updates

In a recent case, I encountered an interesting issue regarding deposits held by landlords.  Specifically, what happens to a tenant's deposit once the landlord/tenant relationship has ended (either the tenant has moved out or abandoned the property, or, the landlord has removed him or her)?  In the Landlord-Tenant Act, RCW 59.18.280 outlines what needs to happen --

"Within fourteen days after the termination of the rental agreement and vacation of the premises or, if the tenant abandons the premises as defined in RCW 59.18.310, within fourteen days after the landlord learns of the abandonment, the landlord shall give a full and specific statement of the basis for retaining any of the deposit together with the payment of any refund due the tenant under the terms and conditions of the rental agreement. No portion of any deposit shall be withheld on account of wear resulting from ordinary use of the premises. The landlord complies with this section if the required statement or payment, or both, are deposited in the United States mail properly addressed with first-class postage prepaid within the fourteen days.

     The notice shall be delivered to the tenant personally or by mail to his last known address. If the landlord fails to give such statement together with any refund due the tenant within the time limits specified above he shall be liable to the tenant for the full amount of the deposit. The landlord is also barred in any action brought by the tenant to recover the deposit from asserting any claim or raising any defense for retaining any of the deposit unless the landlord shows that circumstances beyond the landlord's control prevented the landlord from providing the statement within the fourteen days or that the tenant abandoned the premises as defined in RCW 59.18.310. The court may in its discretion award up to two times the amount of the deposit for the intentional refusal of the landlord to give the statement or refund due. In any action brought by the tenant to recover the deposit, the prevailing party shall additionally be entitled to the cost of suit or arbitration including a reasonable attorney's fee.

     Nothing in this chapter shall preclude the landlord from proceeding against, and the landlord shall have the right to proceed against a tenant to recover sums exceeding the amount of the tenant's damage or security deposit for damage to the property for which the tenant is responsible together with reasonable attorney's fees."

The important thing to remember is that the landlord has a mere 14 days to provide either an explanation of why the deposit has not been tendered (or to ask for more time).  After that 14-day window, the landlord is functionally barred from making any defenses to keeping the money and may actually have to pay more.  So, to all those landlords out there: be sure to take care of the deposit issue within that 14-day deadline.

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             For people experiencing severe financial difficulties and who are overwhelmed with debt, bankruptcy may be an important option. Whether difficult times are brought on by job loss, medical problems, family breakups, or even financial irresponsibility, bankruptcy can grant you much desired relief. Understanding some basic principles of consumer bankruptcy, however, is imperative in knowing which form of bankruptcy is appropriate.

Within bankruptcy law, there are several different “chapters.” Each “chapter” is specifically designed to help either individuals or businesses in eliminating, resolving, and/or repaying their debts. Selecting which bankruptcy chapter to proceed under, depends on the individual’s or business’s specific circumstances. For individuals (“consumers”) who are seeking relief through the bankruptcy process, two chapters are available: Chapter 7 and Chapter 13. These two bankruptcy chapters differ significantly and offer different results.

Chapter 7 Bankruptcy

             Chapter 7 is commonly referred to as “liquidation bankruptcy.” When an individual proceeds under Chapter 7, a trustee is appointed by the bankruptcy court. The trustee then gathers all of the individual’s property (except any property that is exempt), sells (“liquidates”) it, and distributes the proceeds of the sale to the individual’s creditors. At the end of this process, any outstanding debts are discharged (eliminated). The creditors then chalk-up their losses and move on, while the individual must start anew with very little assets leftover. The Chapter 7 process generally takes about four to six months.

             Not everyone is allowed to proceed under Chapter 7, however. To be eligible under Chapter 7, an individual must pass the “means test” (a mechanical formula that is used to determine who can and cannot repay some debt.) If it is determined by the court that the individual’s “current monthly income” is above a certain amount and the individual has the ability to repay some debt, the individual may be denied Chapter 7 relief and may be forced to proceed under Chapter 13. Most people who meet the eligibility requirements proceed under Chapter 7 because, unlike Chapter 13, Chapter 7 takes less time to complete and does not require the individual to pay back any portion of his or her debts.

Chapter 13 Bankruptcy

             Chapter 13 differs significantly from Chapter 7’s liquidation method. Commonly referred to as an “Adjustment of Debt” or “Wage Earner’s Plan,” Chapter 13 focuses on using the individual’s future earnings, rather than liquidated property, to pay creditors. When an individual files under Chapter 13, a court-approved plan allows the individual to keep all of his or her property, but the individual must pay a portion of all future income to the creditors. This payout plan lasts for three to five years, depending on the circumstances and the court-approved plan. When the individual has completed the agreed payout plan, any remaining obligations are discharged.

             Naturally, eligibility to proceed under Chapter 13 requires that an individual must prove that he or she is capable of paying a portion of his or her future monthly income to creditors for a period of three to five years. If the individual’s income is not regular or is too low, Chapter 13 may be denied. Likewise, if the individual’s total amount of debt is too high, the court may deny Chapter 13. Unlike Chapter 7, Chapter 13 takes much more time to complete. However, the major benefit of Chapter 13 is that the individual is allowed to keep his or her property.

             Understanding the main differences between Chapter 7 and Chapter 13 can assist you in knowing which form of bankruptcy will most likely work best for you. Keep in mind, however, that because the bankruptcy process is complex and oftentimes requires professional knowledge to be successful, seeking professional help is your best bet.

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The statute of limitations is the time within which you may bring a claim in court. In Washington, many of the statutes of limitations can be found in Chapter 4.16 RCW. For example, an action upon a written contract must be brought within six years; an action for trespass upon real property must be brought within three years; and a civil action for slander must be brought within two years. 

The statute of limitations for some claims can be found buried in the statute that creates the claim. For example, an action to foreclose on a materialmen’s lien must be commenced within eight months of recording of the lien. RCW 60.04.141.

Not all limitations periods begin to run upon the happening of some event. For example, the time within which to bring certain personal injury claims begins to run when the harm is “discovered” as opposed to when the harm actually occurred.

In order to preserve your right to bring a claim, consult with an attorney who can advise you of any statute of limitations, otherwise, the opportunity to bring your claim may pass you by.

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This past weekend my friends and I went river rafting at Flaming Geyser State Park. When we arrived the park was full so we parked a couple of blocks down the road. As we walked to the park we came upon a 2’ x 2’ hole in the ground approximately 3’ feet deep. One of my friends gleefully turned to me and asked, “could I sue and wins lots of money if I had fallen in?” My friends all looked to me waiting to hear a resounding “yes!” but instead they received a lawerly “it depends.” As dissatisfying as that answer was, it is true. Unfortunately, the law is not black and white. Rather, it is the many shades of gray in between.

My friends mistakenly believe that all legal questions can be looked up in some giant book of laws and the answers recited with definitiveness. Of course, if this were true then there would be no practicing of law, but merely the looking up of laws.  I began to explain to them that a proper analysis involves thorough fact finding: is this private or public property, are we invitees or trespassers, was the hole purposely or naturally created, does the owner know about the hole…..the list went on. It was at that point that my friends’ eyes glossed over and their interest faded away. 

I think their disappointment in my answer stems from our basic need for structure and consistency in the world in which we live our lives. The law made not be as certain as black and white, but utilizing past experience (cases) as our guide, and the similarities and differences between those experiences, outcomes can be predicted within a certain degree of probability. However, before this provides you any comfort, it is important to note that even with the best analysis, judges and juries are the one variable, the proverbial wrench, that are inevitably unpredictable. 

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One of my favorite websites I visit to keep a pulse on the Puget Sound residential real estate market is the Seattlebubbleblog. Its founder and editor is Seattle resident named Timothy Ellis who goes by the blog name “The Tim.” http://seattlebubble.com/blog/ 

The blog has daily posts which include some great graphs, charts and analysis of the Puget Sound real estate market.  What makes the posters on the Seattle Bubble Blog unique is their credibility.  They were one of a few vocal media sources in Washington State that consistently and loudly predicted the current real estate crash before it happened.  In addition to good posts and analysis by “The Tim,” the comment section provides a lively discussion about Puget Sound real estate issues.  *Be aware homeowner: many of the comments made are from bloggers who predict continued steep declines in the Puget Sound real estate - so the blog isn’t for the faint of heart. 

The effect of local and federal laws as they relate to the residential real estate market in the Puget Sound area are also frequently discussed by the blog posters and authors with links to news articles and additional resources.

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In Washington State, the attorney-client privilege is defined by RCW 5.60.060(2), which provides as follows: An attorney or counselor shall not, without the consent of his or her client, be examined as to any communication made by the client to him or her, or his or her advice given thereon in the course of professional employment. 

The purpose of the privilege is to encourage full and uninhibited communications between attorney and client. Thus, although the statute speaks only to whether the attorney may be questioned about communications with a client, the statute has been interpreted to restrict questioning of the client as well.  In a nutshell, the privilege bars evidence of communications between attorney and client only when the communications were intended as confidential. 

The client is the holder of the attorney-client privilege. That is to say that only the client may give consent for the attorney to divulge confidential communications. However, the client may waive the privilege in situations where they bring a third party into closed door conferences with the attorney, share the privileged communications with a third party, or confer with the attorney where the conversation may be heard in the open by the public. Other situations of waiver include the client commencing an action against the attorney, and in a criminal case, a plea of insanity or diminished capacity waives the attorney-client privilege.

A corollary to the attorney-client privilege is the ethical rule governing the confidential nature of the attorney-client relationship. The Rules of Professional Conduct (RPC) govern the attorney-client relationship. Once such a relationship has been formed, a lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation or the disclosure is reasonably necessary to prevent reasonably certain death or substantial bodily harm, to prevent the client from committing a crime, to prevent, mitigate or rectify substantial injury to the financial interests or property of another that is reasonably certain to result or has resulted from the client’s commission of a crime or fraud in furtherance of which the client has used the lawyer’s services, to secure legal advice regarding compliance with the rules, to establish a claim or defense on behalf of the lawyer in a controversy between the client and attorney, to comply with a court order, or to inform a tribunal about any client’s breach of fiduciary responsibility when the client is serving as a court-appointed fiduciary. RPC 1.16. 

Even where an attorney-client relationship has not yet been formed, but the prospective client discusses with a lawyer the possibility of forming such a relationship, a lawyer who has had discussions with a prospective client shall not use or reveal information learned in the consultation, with limited exceptions found in RPC 1.9. RPC 1.18.

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