Common Interest Communities.

A common interest community (CIC) is a form of real estate in which each unit owner or homeowner has an exclusive interest in a unit or lot and a shared or undivided interest in common area property.? In Washington, several statutes govern residential CICs, such as condominiums, cooperatives, leasehold CICs, miscellaneous communities, and plat communities.

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The Washington Uniform Common Interest Ownership Act (WUCIOA) took effect July 1, 2018, and is applicable to CICs created on or after that date.? A CIC created prior to the effective date of the WUCIOA may choose to opt into the WUCIOA.

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Older CICs that have not opted into the WUCIOA are regulated by different statutes depending on their ownership structure and the date they were created:

• the Horizontal Property Regimes Act (HPRA) governs residential condominiums created on or before July 1, 1990;?
• the Washington Condominium Act (WCA) governs condominiums created after July 1, 1990; and
• the Homeowners' Association Act (HOAA) provides a framework for the formation and legal administration of homeowners' associations created before July 1, 2018.

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Effective January 1, 2028, the older CIC statutes will be repealed and the WUCIOA will apply to all CICs regardless of their creation date.

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Resale?Certificates.

With certain exceptions, prior to the execution of any contract for the sale of a unit in a CIC subject to the WCA or the WUCIOA, a unit owner must provide the purchaser with a?resale?certificate signed by an officer or authorized agent of the association.? An association must furnish a resale certificate containing all of the required information to the unit owner within 10 days of a request by the unit owner.? The WUCIOA and the WCA contain similar resale certificate requirements.

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Required Contents of a Resale Certificate.

Under the WUCIOA, the resale?certificate must contain specified information regarding the unit and the CIC, including:

• a statement of the monthly common expense assessments, any unpaid common expenses or special assessments currently due and payable from the selling unit owner, any anticipated repair or replacement costs approved by the association, and any other fees payable by unit owners;
• the annual financial statement and the current operating budget of the association;
• a statement describing any insurance coverage provided for the benefit of unit owners;
• a statement as to whether there are any alterations or improvements to the unit or to the limited common elements assigned to the unit, or any violations of the health or building codes with respect to the unit; and
• certain other information.

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Charges for Preparation of a Resale Certificate.

A reasonable charge for the preparation of a resale certificate may not exceed $275.? An association may charge a nominal fee, not to exceed $100, for updating a resale certificate within six months of the request.

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Limitations on Liability.

A unit owner is not liable to the purchaser for any erroneous information provided by the association in the resale certificate, or for the failure or delay of the association to provide the certificate in a timely manner.? A purchaser is not liable for any unpaid assessment or fee greater than the amount specified by the association in the certificate.?

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Cancellation of Purchase Contract.

The purchaser may void the purchase contract up until five days after the resale certificate is provided, or up until the property is conveyed to the purchaser, whichever occurs first.

The resale certificate requirements for units in a CIC subject to the WUCIOA are modified.?

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Required Contents of a Resale Certificate.

In addition to all the other information that must be included in a resale?certificate, the resale certificate must contain:

• the most recent final financial audit report available and the current draft of a more recent report if available, instead of the audit report for the year immediately preceding the current year;
• all policies, procedures, and resolutions approved by the board that are currently in effect; and
• the most current final reserve study for the association and the most recent draft of a newer reserve study if available, instead of a summary of the current reserve study.

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The resale certificate must include the statement "NONE" or "RECORDS UNAVAILABLE" for each category of records that is not provided in the certificate.

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Charges for Preparation of a Resale Certificate.

In addition to not exceeding $275, a reasonable charge to the unit owner for preparation of a resale certificate must cover the direct out-of-pocket cost of copying and providing the required information, and may not include any additional charges for providing documents that are maintained in electronic form on a website, web portal, or application available to unit owners.? However, an association may charge an additional $100 for a rush service that must be completed within 72 hours of a request.? An association may also still charge a nominal fee, not to exceed $100, for updating a resale certificate within six months of the unit owner's previous resale certificate request.?

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Fees for copying and providing documents required by a resale certificate must be distinguished, stated, and billed separately from all other fees, fines, or assessments.?

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A unit owner possessing current copies in electronic form of any document required by a resale certificate must provide them to a purchaser via electronic transmission at no cost.

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An association may not require a unit owner to contract or establish an account with a third party to provide payment or accept delivery of a resale certificate.?

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Limitations on Liability.

In addition to the existing limitations on liability, a purchaser is not liable for any violation of the governing documents created by an alteration to a unit that, with reasonable diligence, should have been known to the association or its authorized agent at the time of conveyance but was not identified in the resale certificate.

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Cancellation of Purchase Contract.

The provisions regarding when a purchaser may cancel a contract are revised.? A purchaser may cancel a contract for purchase of a unit within five days after first receiving the resale certificate.? If the resale certificate is first provided to a purchaser more than five days before execution of the purchase contract, the purchaser does not have the right to cancel the executed contract.?

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If the resale certificate is first provided to a purchaser five days or less before the purchase contract is signed, the purchaser may cancel the contract before the property is conveyed to the purchaser by delivering a cancellation notice to the seller.? The cancellation notice must be delivered to the seller no later than the fifth day after the purchaser first received the certificate.

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If the resale certificate is first provided to a purchaser less than five days before the closing date for the conveyance of the unit, the purchaser may extend the closing date by up to five days after receipt of the resale certificate.