Lakeview Boulevard Condo. Ass'n v. Apartment Sales Corp. - 146 Wash. 2d 194, 43 P.3d 1233 (2002)

Rule:

Generally speaking, a covenant touches or concerns the land if it is such as to benefit the grantor or the lessor, or the grantee or lessee, as the case may be. As the term implies, the covenant must concern the occupation or enjoyment of the land granted or demised and the liability to perform it, and the right to take advantage of it must pass to the assignee. Conversely, if the covenant does not touch or concern the occupation or enjoyment of the land, it is the collateral and personal obligation of the grantor or lessor and does not run with the land.

Facts:

Respondents, the homeowners, were the owners of three condominiums that were rendered uninhabitable when the soil underlying the property gave way precipitously during winter storms. The homeowners brought suit against several parties, including the city. Before allowing the condominiums to be constructed, the city, concerned about the possibility of landslides, had imposed several conditions on the developer. Those conditions included a covenant exculpating the city from liability for damages caused by soil movement. The city was granted summary judgment. The court of appeals reversed, and reinstated the negligent maintenance claims. The city appealed.

Issue:

Could the respondent homeowners pursue claims against the city arising out of negligent maintenance of the storm and water drain system? 

Answer:

Yes.

Conclusion:

On review, the supreme court held that the city was not liable for negligently granting a permit to build on the site, and the exculpatory covenant was valid to the extent it released the city from liability resulting from soil movement resulting from the issuance of the permit. The covenant did not, and could not, exculpate the city for soil movement-related losses caused by the city's own negligence. The homeowners could pursue claims against the city arising out of negligent maintenance of the storm and water drain system. The decision was reversed in part, affirmed in part, and remanded.