Change of Fees Requires Consent

Published on: May 13, 2001

In mixed use condominiums there is often substantial concern over to what uses commercial units can be put and whether an owner of such a unit can obtain a change in such use without the consent of either the association and/or the other unit owners. In the case of The 39 Joy Street Condominium Association v. Board of Appeal of Boston, Et Al., Suffolk Superior Court No. 95-0788 (7/31/96), at least one Judge has provided some guidance. (A decision of a trial court is binding only in the parties in the case. It does not create “precedent” binding all in the state. Only the decisions of the appellate level courts create binding precedent. However, a thoughtful trial court decision is always of guidance).

In this case the condominium consisted of three residential units on the 2nd, 3rd and 4th floor of the building with a commercial storefront on the first floor. The City of Boston, which had taken title to the unit (“Unit C”) for nonpayment of taxes, sold the Unit to an individual

(“Mr. C”) who wanted to use it as a beauty shop. To obtain an occupancy permit for this usage Mr. C needed to obtain, and applied for, a variance under the zoning code. The three residential unit owners objected to this intended use. However, Mr. C went ahead with his purchase and the application for the variance. The Association brought suit challenging, among other things, the right of Mr. C to, on his own, seek and obtain a change in use of the premises. (Under most zoning codes it is an entire building or property to which a permit is granted for its use. Thus, changing the use of a part affects the permitted use of the whole). Judge Charles E. Barrett, noting first that there was no direct, guiding precedent, ruled that one individual owner had no authority to seek a change in the legal usage of a whole building without first obtaining the consent of the other owners and the association. As stated by the Court, “It seems inconceivable that an owner of a portion of the property as to which the variance is sought would not be required to join in the application, for otherwise his or its property could be adversely affected without permission.” “The proper course . . . would be to request, in appropriate fashion the Association and, fellow unit owners, their consent and joinder to any such application and, in the event that such request is rebuffed, to challenge that action by appropriate proceeding.” (Just what that appropriate proceeding is, is not particularly clear).

What is of significant in this case is that the desired usage was not permitted “as of right” under the zoning code. Rather, a variance was necessary. In most mixed use condominiums the documents either categorized the types of commercial uses allowable or say any commercial use permissible under the applicable zoning code. Thus, under the reasoning of this case, as long as the use was permissible under the zoning code, absent some other provision in the condominium’s documents no consent would be necessary. However, if the desired usage is not specifically permissible (that is, of right) then consent becomes necessary and under the reasoning of this case such consent must be obtained from all fellow owners.

Significant to this was the fact that the documents contained no provision on how to obtain such consent. Presumably this was because it was a small condominium (four units) and the consent of all was appropriate. But what about a large condominium where no provision exists for such consent. The Court’s decision seems to suggest that what is necessary is the consent of 100% of the owners and, though not cited by Judge Barrett, many practitioners might agree under the reasoning of Kaplan v. Beadreau, a case which held that a unit owner’s interest in the common areas could not be diminished without all owners consenting. Here, however, while an owner’s interest is being affected, it is not being diminished. Thus, an argument exists that only the percentage necessary to amend the Master Deed need be obtained.

 As noted, this is not an appellate court decision, and thus it is not binding on other than the parties. The Court’s ruling, however, appears quite logical. Thus, there is a strong measure of protection with regard to what uses a commercial unit may be put. Boards should be vigilant in these regards as few Zoning Board of Appeals or other government agencies will be aware of the requirement that such a change requires more than just the unit owner’s petition.