A win for former tenants of Tacoma's Old City Hall
KATHLEEN COOPER
After four years of fighting, two former tenants of Tacoma’s Old City Hall have won a major legal victory against the owner.
A judge ruled this month that the facility’s owner failed, over and over, to respond to the tenants’ complaints and created an environment where they had no choice but to move out.
Not only do the tenants not owe back rent, they should be reimbursed for the expense of being forced to relocate, the judge ruled.
“The evidence is overwhelming that there was a substantial breach of the lease agreements in that the premises ceased to be usable,” Chris Wickam, a Thurston County Superior Court judge who is presiding over the case, wrote in a May 14 ruling.
Describing the building conditions in 2008, Wickam said the record shows “serious problems with the premises including heating and air conditioning, threatened shut-off of utilities, inadequate security, transients living in the building, feces and garbage in the common areas, and restriction of access to the building.”
George Webb, owner of The Stratford Co., which owns Old City Hall, didn’t respond to an email request for comment Friday.
While damages might be awarded, the tenants don’t expect to receive any money. The judgment is against the limited-liability company that owns only the building, which has no income. Webb’s larger real estate company isn’t legally responsible.
“We don’t have any expectation that there will be any resources to pay this judgment,” said Kathleen Pierce, a lawyer representing the Pierce County AIDS Foundation, one of the two tenants. The other is a Tacoma lawyer, Peggy Fraychineaud Gross.
The only issue left to determine is whether Old City Hall LLC will continue to a trial to determine exactly how much the judgment should be, an amount that likely would be turned into a lien against the building. Pierce said she hoped the parties could come to an agreement on the amount without a trial.
Pierce estimated the foundation’s moving expenses to be about $110,000 and her attorney’s fees at about $45,000. So far, she has provided legal services for free. Gross couldn’t be reached for comment Friday, so her expense estimates weren’t available.
The legal battle began in February 2010 when Old City Hall LLC, which Webb controls, sued the foundation and Gross, accusing them of breaking their leases in the historic building at 625 Commerce St. The tenants counter-sued, accusing the company of letting the building fall into such a state of disrepair, it was unsafe to use.
The fight between the parties began much earlier.
Webb’s ownership group bought the building in 2005 with plans to redevelop it into luxury condominiums. He offered inducements to get the building’s tenants to leave, including moving costs and help finding new space.
But the AIDS Foundation and Gross declined to move for various logistical reasons. They weren’t required to, either, because they both had active leases. The court record shows Gross and the foundation began having trouble getting their landlord to respond to problems as early as March 2008.
The court record is thick with examples of Old City Hall’s neglect. Email after email documents trouble with temperature, broken locks and stolen items. Photographs show the unsanitary evidence of squatters.
Pierce said the neglect was intentional. Webb “couldn’t buy them out, so (he) forced them out,” she said.
One statement from a commercial heating and air conditioning company hints at the company’s financial strain, with Old City Hall LLC having overdue bills and staffers asking the A/C company to use parts from one system to fix another rather than pay for a replacement.
The foundation and Gross finally moved out while their leases were still in effect. Old City Hall LLC sued them in February 2010, asking for more than $371,000 in back and future rent. They counter-sued the next month. A Thurston County judge presided because the Pierce County judges recused themselves in light of Gross’ local law practice.
At the end of 2010, the building flooded after a sprinkler pipe broke during a thaw. Mitigation work since has been completed. Webb staved off foreclosure in 2011 by renegotiating the loan.
Donors to the AIDS foundation, which provides services to about 450 people infected with HIV each year, were not put off by the lawsuits, said Judith Billings, board chairwoman. Fundraising has been “solid and stable,” she said Friday.
“The one thing that certainly we would like to see happen is to recover the cost of moving,” she said. “But the fact that this simply sets aside any expectation or requirement that the foundation pay back rent and clear through the lease, that is a victory in itself.”
kathleen.cooper@thenewstribune.com
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Twitter: @KCooperTNT
