Rockville Grosvenor, Inc. v. Montgomery County

422 A.2d 353, 289 Md. 74, 1980 Md. LEXIS 232
CourtCourt of Appeals of Maryland
DecidedNovember 13, 1980
Docket[No. 146, September Term, 1979.]
StatusPublished
Cited by26 cases

This text of 422 A.2d 353 (Rockville Grosvenor, Inc. v. Montgomery County) is published on Counsel Stack Legal Research, covering Court of Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rockville Grosvenor, Inc. v. Montgomery County, 422 A.2d 353, 289 Md. 74, 1980 Md. LEXIS 232 (Md. 1980).

Opinions

Rodowsky, J.,

delivered the opinion of the Court. Cot.k and Davidson, JJ., concur in part and dissent in part. Davidson, J., filed an opinion concurring in part and dissenting in part at page 104 infra, in which Cole, J., joins.

In the summer of 1979 the County Council of Montgomery County enacted a series of local laws in response to its finding that there was a shortage of rental housing as a result of conversions of apartment developments from rental facilities to condominium regimes. Owners of apartment projects challenged these laws in two actions in the Circuit Court for Montgomery County. They were only partially successful and have appealed from the denial of the balance of the relief claimed. There are no cross-appeals. We granted certiorari in the consolidated appeals prior to consideration by the Court of Special Appeals. The statutes principally in issue relate to (1) converter liability to displaced tenants for relocation expense, and (2) a right conferred on certain organizations to buy an entire rental facility which is proposed for condominium conversion. Because these provisions of local law conflict with the Horizontal Property Act (HPA), Maryland Code (1974, 1980 Cum. Supp.), §§ 11-101 through 11-128 of the Real Property Article, we shall reverse as to those aspects.

I

There has been local regulation relating to the sale of condominium units in Montgomery County beginning with 1974 Laws of Montgomery County, ch. 58, § 1 which added Chapter 11 A, title, "Condominiums,” to the Montgomery County Code (1972). This was basically a consumer protection disclosure statute. A developer of a condominium was required to prepare a "property report” setting forth specified information concerning the developer and the [78]*78physical, legal and financial aspects of the project. The property report was to be filed with the Montgomery County Office of Consumer Affairs and furnished to prospective purchasers. In conversion situations, written notice to each tenant prior to conversion, together with a property report, were to be furnished by the developer. As first enacted the notice period under county law was 120 days.1

These appeals involve at least 6 local laws dealing with condominium conversion which were enacted between July 3, 1979 and February 12, 1980. According to a study2 transmitted by the County Executive to the County Council on July 3, 1979 approximately 10,400 apartment and townhouse units in the county had been converted from rental to ownership during the period January 1969 through May .1979. Of some 67,900 units originally constructed for rental operation, about 15.3% had been converted, leaving a net rental stock of roughly 57,500. Approximately 5,422 units had been converted during 1972-1975. In the period January 1978 through May 1979, 4,000 units were converted or scheduled for conversion.3

[79]*79Emergency legislation, effective July 6,1979, was enacted by county council Bill 37-79. It provided for the developer or converter to reimburse up to $750 of the cost of relocation to displaced tenants. Bill 37-79 was amended by Bill 46-79, an emergency bill effective July 20, 1979. Bill 46-79 contained four provisions which appellants contest.

1. 60 day ñling. Montgomery County Code, § 11A-4 (a) was amended to provide that a "developerL4! ... shall not enter into a binding contract ... for the sale of any condominium unit unless . .. fa] copy of a property report. .. is filed ... at least sixty days prior to the first offering or at least sixty days prior to the notice of conversion to tenants.” Prior to this amendment the minimum interval between filing the property report and the first sale of a unit was 10 days.

[80]*802. Relocation cost. Section 11A-5 (c) was added to the county code to provide that "[ujpon the involuntary termination of any tenancy which results from a condominium conversion, the developer or converter shall reimburse displaced tenants, determined to be in need of financial assistance under criteria established by County Executive regulation, the reasonable costs of relocation as determined under regulations issued by the County Executive up to a maximum obligation of $750.”

3. Moratorium on rental unit sales. Bill 46-79 also added § 11A-5 (d) which reads:

It shall be unlawful for a developer to enter into contracts for sale of any rental units proposed to be converted to condominium units which are part of a condominium project for which a property report.. . has not been filed.. . until such time as the horizontal property regime is created pursuant to State law. The provisions of this Section 11A-5 (d) shall cease to have any force and effect at 12:01 a.m. Saturday, November 10, 1979.

4. Moratorium on conversions. Subsection 11A-5 (d) was complementary to the moratorium on conversions provided in Bill 46-79, under which "no owner of a rental facility ... shall issue a notice of intent to convert to a condominium” for a period of 120 days from July 13, 1979 at the end of which the moratorium expired.

Bill 46-79 was the subject of equity case 68203 (the "relocation cost case”) brought in the court below on August 9,1979 by certain of the appellants. These include Rockville Grosvenor, Inc., the owner of the Grosvenor Park Apartments containing about 1,000 rental units, and LaVay Rockcreek, Inc., the owner of the Rock Creek Garden Apartments containing about 500 rental units. These two owners had each filed pre-conversion property reports with the Office of Consumer Affairs and given to their tenants the notice of intention to create a condominium required by Md. Code (1974, 1980 Cum. Supp.), § 11-102.1 of the Real Property Article.

[81]*81Trial of equity 68203 on August 22, 1979 was limited to the validity of the provision for reimbursement of relocation costs. This was because the plaintiffs desired an expedited hearing and decision on the reimbursement issue and because equity case 68354, described infra, had been filed on August 21, 1979, in which the remaining issues under Bill 46-79 would be decided. The trial court upheld the relocation cost reimbursement provisions of Bill 46-79 but found the regulation issued thereunder to be contrary to the local statute and void.

Six days after Bill 46-79 went into effect, i.e., on July 26, 1979, the County Executive signed another emergency enactment, Bill 42-79. It provided for a right in certain organizations to purchase a rental facility which was to be sold. Both Bill 46-79 and Bill 42-79 were attacked in the second case in this appeal, Equity No. 68354 (the "first right to buy” case). In addition to the Apartment and Office Building Association, plaintiffs in that case included the owners of Georgian Woods Annex Apartments (371 units in Wheaton), Westchester West No. 2 Apartments (345 units in Wheaton), Randolph Square Apartments (120 units in Rockville), London Terrace Apartments (61 units in Silver Spring) and Georgian Towers Apartments (859 units in Silver Spring).

The lifetime of Bill 42-79 was only until September 19, 1979 when its provisions were repealed and re-enacted with amendments by another emergency local law, Bill 51-79. Equity 68354 came on for trial on September 19, 1979, the complaint was amended to include an attack on Bill 51-79 and the case was tried that same day.

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Bluebook (online)
422 A.2d 353, 289 Md. 74, 1980 Md. LEXIS 232, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rockville-grosvenor-inc-v-montgomery-county-md-1980.