THE EVERGREEN LAND TRUST ASSOCIATION
SAMPLE USE AGREEMENT
WHEREAS, ELT is organized exclusively for charitable purposes, including the protection of urban communities and individuals from real estate speculation, the advancement of sustainable technologies and land use practices, and the promotion of organizational models for the collective/cooperative trusteeship of land; and
WHEREAS, the Community shares the purposes and goals of ELT and has agreed to enter into this Use Agreement not only to obtain those benefits to which the Community is entitled under this Use Agreement, but also to further the charitable purposes of ELT; and
WHEREAS, it is mutually understood and accepted by ELT and the Community that the terms and conditions of this Use Agreement further their shared goals over an extended period of time and through a succession of members; and
WHEREAS, the House described in this Use Agreement has been acquired by ELT and shall be used by the Community in accordance with the the Housing Trust Agreement, to further the purposes of that Trust Agreement, which are:
A. To maintain and improve the House to form the basis of urban communities particularly for student cooperative housing, and thus to provide an impetus to reverse gentrification;
B. To encourage communal, sustainable, cooperative living as a viable life-style and to provide a basis for cooperative living as a lifestyle choice beyond school;
C. To promote the study of technologies and lifestyle choices that promote a symbiotic relationship with the environment;
D. To promote a sense of cooperation and balance between urban and rural lifestyles;
E. To aid and advance the creation and growth of cooperating communities; and
F. To encourage experimental education and communities of alternative solutions to the present economic, political, and social system.
NOW THEREFORE, in consideration of the foregoing recitals, the Community and ELT agree to the terms and conditions of this Use Agreement as stated herein.
This Use Agreement is between the Evergreen Land Trust Association (“ELT”) and the Community (“The Community”). The purpose of this Use Agreement is to specify the terms and conditions under which ELT gives license to occupy the premises of the the Housing Trust (“The House”) in furtherance of the the Housing Trust Agreement dated ________________.
All capitalized terms used herein that also appear in the Trust Agreement, shall have the respective meanings assigned to them as provided in the Trust Agreement.
The period of this Use Agreement shall be for twenty-five (25) years, with the option in the Community to renew the same for successive twenty-five (25) year periods, with extension of the Use Agreement for a successive term occurring automatically if neither party gives notice to terminate or amend the Use Agreement, as hereinafter provided.
The use of the House and the activities of the Community thereat shall not be inconsistent with the purposes, and shall be expressly subject to the limitations as to such uses, set forth in the Trust Agreement, which for this purpose is hereby incorporated by reference as though fully set forth herein.
5. COMMUNITY’S MEMBERSHIP IN ELT.
The Community shall be the sole representative of the Occupants to ELT for all purposes of the Trust Agreement and this Use Agreement.
All Community Members are considered resident members of ELT, and, as members, shall honor the agreements, policies, Bylaws, and Articles of Incorporation of ELT, and take into consideration the interests of the other houses and communities making up ELT when participating in the decision-making process of ELT.
Two (2) Community Members shall serve as voting members of the Board of Directors of ELT. Those members ("Community Board Members"):
i. Shall be selected in accordance with Community Agreements, and presented to ELT for election or appointment, and unless found by the ELT Board of Directors to be unfit to so serve, shall be elected or appointed to so serve until the earlier of when the respective Community Board Member either ceases to be a Community Member, or when such person's term on the ELT Board of Directors terminates in the ordinary course, in which case the selection process shall recommence for prompt selection or appointment of a replacement who is a Community Member;
ii. Shall serve as board members of the ELT Board of Directors and, in common with all other such board members, be:
A. Subject to the laws, articles, bylaws and internal regulations of or applicable to ELT;
B. Fiduciaries for ELT at large, with the obligation to act and further the interests of ELT, however cooperatively that may be done, and shall represent the interests of the Community only in expression of point of view, background or provincial interests, but their right to vote on any such matter shall be subject to the same laws and rules relating to conflict of interest that apply to all other members of the ELT Board of Directors; and
C. Not subject to voting instruction or voting direction from the Community or other Occupants (who shall, however, be free to state their views to the Community Board Members, to the same extent that they shall be free to do so to all ELT Board Members).
6. RESPONSIBILITIES OF ELT.
ELT shall be responsible for the following:
To the extent of funds on hand received from the Community, and from any additional available funds budgeted therefore by the ELT Board of Directors, assist the Community in meeting any of the responsibilities defined in Section 7
a below, in the case of financial difficulties of the Community;
To cooperate with the Community to insure that all Occupants comply with the Trust Agreement;
To enter into and execute, pending agreement by the Community, such notes, mortgages and deeds of trust upon the House as authorized by ELT pursuant to this Use Agreement;
To render an annual report of its own accounts to the Community and to keep the Community regularly informed as to its activities (which it may do through reports to the Community by the Community Board Members); and
To not interfere with the day-to-day affairs of the Community, provided that the Community is in compliance with the Trust Agreement, Use Agreement, and applicable laws. In the event of a breach of duties and covenants to be fulfilled by the Community, ELT shall give notice in writing of any breach and curative action required to reinstate the Use Agreement.
7. RESPONSIBILITIES OF THE COMMUNITY.
The Community shall be responsible for the following:
To maintain the House in good, safe, and habitable condition in all respects except for normal wear and tear, and in full compliance with all applicable laws and regulations of any governmental authority with jurisdiction over matters concerning the condition of the House;
To be responsible for the use of the House by all residents and their families, friends and visitors and anyone else using the House with their consent, and shall make all such people aware of the spirit, intent and appropriate terms of this Use Agreement;
To assess the Occupants in accordance with the guidelines established in the Trust Agreement, and to pay insurance, taxes, utilities, mortgage installment payments (if applicable), maintenance and improvement costs of the House, and any other costs that arise through possession and use of the House in a timely fashion;
To maintain occupancy levels and assessment rates which ensure that periodic vacancies will not endanger the Community’s ability to fulfill its obligations;
To notify ELT if the anticipated vacancy of the house should drop below fifty percent (50%) for a period of thirty (30) days or longer, and to submit a written sixty (60) day notice to ELT if a decision is made by the Community as a body to terminate occupancy or if problems are anticipated which could seriously affect the Community's ability to meet necessary expenses;
To make a good faith effort to find satisfactory replacement Occupants if a decision is made by the Community to terminate occupancy of the House;
To establish Community Agreements which include policies and procedures for the determination of Membership in the Community, and ensure that Community Members compose at least 75% of the total occupants in the House for at least eight months of each year;
To perform the administrative duties of the Community in a cooperative and responsible manner, including regular meetings of the membership and consistent record keeping of Community Agreements, decisions, and financial activities;
To render an Annual Report to the Board of ELT in accordance with ELT Bylaws and Board Policies, which includes a report of all income and expenses of the Community in fulfilling this Use Agreement;
To submit any proposed amendments to this Use Agreement to ELT, if the Community wishes to do anything in conflict with the then existing Use Agreement so long as to do so is not in violation of the Trust Agreement; and
It is hoped that when the Community obtains a commitment to refinance the House between 2002-2005 inclusive, if the Community obtains a 30 year or longer amortization period on the loan, which ELT agrees to execute provided recourse is limited to the House, the Community will pay back the loan at a faster rate by increasing the annual payments at a 1% annual rate increase commencing after the first year of the Loan.
8. INSURANCE AND LIABILITY
Evergreen Land Trust shall, at the Community’s expense, maintain continuously in effect liability insurance covering the House and improvements, including loss from any damage from all perils including without limitation fire, flood and earthquake for the full replacement value.
A. The dollar amounts of this coverage shall be recommended by the Community and approved by ELT, and adjusted at two-year intervals, beginning on the date this Use Agreement is signed, or upon 30 days notice to Community.
B. Such insurance shall specifically insure ELT and the Community against all liability assumed under this Use Agreement, as well as all liability imposed by law.
C. The Community and ELT shall both keep copies of all policies and renewals of policies on file. All policies shall contain endorsements providing that they shall not be cancelled, reduced in amount or coverage or otherwise modified by the insurance carrier involved without at least thirty (30) days prior written notice to ELT. The Community shall be entitled to participate in the settlement or adjustment of any losses covered by such policies of insurance.
D. Individual Community Members shall have no liability to ELT for any actions, or failure to act, that constitute mere negligence. However, liability from Community Members to ELT shall exist for any acts, or failures to act, constituting gross negligence, fraud, recklessness, malicious conduct or an intentional tort.
Each Community Member may temporarily sublet his/her right to occupy the House provided that the sublet is arranged in accordance with Community Agreements, all other Community Members are notified in advance, and all subletting fees are paid exclusively to the Community. No subletting shall relieve or excuse any Community Member from his/her obligations hereunder, or under the Trust Agreement, or to the Community. The Community shall further ensure that subletting periods are clearly defined with reasonable time limits, and that the number of subletters does not contradict the limits for occupancy as set forth in Section 7.g, above.
10. INDEPENDENCE OF THE COMMUNITY.
Subject only to the right of appeal set forth in Section 12.b, below, the occupancy, internal conditions and operation of the House shall, as between ELT and the Community, be determined by the Community, provided that such occupancy, internal conditions and operation are fully consistent with the Trust Agreement, this Use Agreement, Bylaws, Articles of Incorporation, and all other agreements pertaining to the House to which ELT or the Community may be a party.
This Use Agreement, subject to the provisions of the Trust Agreement, is the complete expression of the parties' agreement as to the date hereof, but may be amended only in a writing signed by the authorized official representatives of both the Community and ELT, provided that the ELT Board of Directors may unilaterally amend this Use Agreement, but only to the extent necessary to comply with, protect or preserve ELT's federal tax exempt status. In the case of any unilateral amendment made under this paragraph, written notice thereof shall be immediately given to the Community.
12. MEDIATION, ARBITRATION, AND ATTORNEY FEES.
a. Mediation. In any controversy between any of the parties whose rights or obligations are subject to this Use Agreement, the parties are encouraged to seek professional mediation services to resolve all disputes as quickly and amicably as possible.
b. Arbitration. Except as provided in section 12(d) herein, all controversies between any parties whose rights or obligations are subject to this Use Agreement, including Community Members with respect to their right to occupy the House and their obligations to ELT, shall be subject to arbitration pursuant to Chapter 7.04 RCW as herein provided, and occupancy of the House by any Community Member shall be expressly subject to this requirement notwithstanding that such arbitration may, as a collateral effect, terminate either or both membership of ELT and/or on the ELT Board of Directors.
i. If requested and agreed to by all the parties to the dispute, the ELT Board of Directors may serve as an arbitrator whose decision shall be final and binding on the parties. Unless waived by the parties to the controversy, the provisions of Chapter 7.04 RCW shall apply.
ii. In any controversy not covered by subsection 12(b)i., the arbitrator shall either be agreed to and appointed by the parties to the dispute within fourteen (14) days of the controversy becoming ripe for arbitration, or in the absence on an agreed appointment, any party to the controversy may seek appointment of one arbitrator pursuant to RCW 7.04.050, and that arbitrator shall then and thereafter proceed as provided by law.
c. Attorneys Fees. In case arbitration or suit is commenced under any provision hereof, the prevailing party shall be entitled to an award of attorneys' fees in a reasonable amount to be fixed by the arbitrator or by the court for all attorneys' fees incurred in mediation, arbitration, or lawsuit, and all appeals therefrom, in addition to otherwise allowable costs as provided by law. If the controversy is fully resolved by mediation, it is deemed that both or all parties are successful, and each party shall bear the costs and expenses of its/his/her own attorneys' fees and costs.
d. Exceptions to Requirement to Arbitrate. The foregoing provisions of this Section 12 shall not apply to any matter which is the subject of actual or alleged criminal behavior, any matters which relate to the domestic status between the parties to the domestic relationship only, any matters relating to harassment or no-contact laws or their enforcement, or any matter involving either cancellation without timely renewal of casualty or public liability insurance on the House, or if an authorized person on behalf of either ELT or the Community certifies under oath that immediate injunctive relief is necessary to prevent imminent damage to or destruction of the House and/or harm to any community member.
Whenever the delivery or service of a notice from one party to the other shall become necessary or convenient by virtue of any of the provisions hereof, such service may be made by personal delivery or, at the option of the notifying party, in the following manner:
a. If to the Community: by personal service on a Community Member, or by leaving a notice addressed to the Community at the House, and in addition mailing first class postage prepaid a duplicate to the Community at the same address;
b. If to ELT: personal service on the registered agent of ELT, and in addition mailing a duplicate first class postage prepaid addressed to the office of ELT at 3231 Hillside Road, Deming, WA 98244.
c. If to any Occupant:
i. if by the Community, by delivering the notice to the room primarily occupied by the Occupant, and if the Occupant is not then in residence at the House, then in addition mailing a duplicate notice first class postage prepaid to the last known other address of the Occupant, if known to the Community; and
ii. if by ELT, by delivering two copies of the notice to the Community as provided above, with a written request that the Community redeliver them to the Occupant as provided above.
14. BREACH OF THIS USE AGREEMENT
ELT shall have the right to retake possession and control of the House in whole or in part upon failure to timely cure the breach of any duty to be performed by the Community under this Use Agreement. Revocation of this Use Agreement, as license to occupy and use the premises, shall be commenced by:
a. The giving of notice, in writing, of the compliance issues and set a time frame by which the community shall rectify the issue.
b. Assigning a Member of the Board to monitor the process, and, if needed, form an ad hoc committee of professionals familiar with Community Land Trusts to provide counsel and oversight, to ensure a fair and just process.
If the Community fails to rectify the compliance issue within the allotted time frame, ELT shall be authorized to proceed as provided in Section 12, above to commence eviction proceedings in accordance with Washington State Law. The community may defend against eviction by proving that it has cured the breach that ELT described in the notice. This is not a defense, however, to any other relief ELT seeks in the lawsuit.
The Community reserves the right to terminate and discontinue their license under this Use Agreement at any time, effective upon giving thirty (30) days notice to ELT, whereupon further rights of Occupants to reside or otherwise occupy the House shall cease.
16. SUCCESSORS AND ASSIGNS.
a. Of ELT. The rights of ELT hereunder may be assigned only to an entity which succeeds to the House as successor trustee under and pursuant to the Trust Agreement.
b. Of the Community. The Community may assign its rights hereunder to any legal entity having the same purposes and substantially the same operational rules and values as the Community, provided that no legal or economic consideration in excess of assumption of the assignor's obligations hereunder and indemnity therefore is given in exchange. The Community shall obtain the consent of ELT to transfer its right to another entity provided ELT’s consent shall not be unreasonably withheld.
c. Condition and Effect of Assignment. It shall be a condition of any assignment by either party hereto that its successor shall assume the obligation of its assignor arising prior to, from or after the date of such assignment, whereupon the other party hereto shall look only to the assignee for recourse hereunder from and after such date. For purposes hereof, the date of assignment shall be the latter of the date upon which the assignment and assumption is executed by both parties thereto, and the other party to this Use Agreement receives an executed copy thereof together with, as to the Community, the names of all members thereof in writing, and as to ELT, the name and address of its successor, and any contact person if different from prior to the assignment. Any assignment made in violation of this Section 15, shall be null, void, and of no effect.
Without the necessity of any additional document being executed by the Community or any Community Member for the purpose of effecting a subordination, this Use Agreement shall be subject and subordinate at all times to any mortgage or deed of trust which may no exist or be placed upon the House, or ELT's interest or estate therein, which is specified as security. Notwithstanding the foregoing, ELT shall have the right to subordinate or cause to be subordinated any such liens to this Use Agreement. Within ten (10) days after request by ELT, the Community shall execute and deliver any additional documents evidencing the Community's attornment or the subordination of this Use Agreement with respect to any such mortgage or deed of trust, in the form requested by ELT or any mortgagee, or beneficiary under a deed of trust, subject to such nondisturbance requirement.
18. OPTION TO EXTEND.
Provided that the Community is not then in breach or default under this Use Agreement, the Community shall have the option to extend the term of the license granted by ELT under this Use Agreement any number of times, which option may be exercised each time by the Community remaining in possession of the House, whereupon this Use Agreement shall be extended for a period of twenty-five (25) years. At the end of the first twenty-five (25) year option extension period, all further extensions shall be subject to the parties' agreement on such changes as ELT may require as a condition of consent thereto. If the Community is not in agreement with the changes, the Community, otherwise without breach or default hereunder, may remain in possession of the House, until the controversy is resolved as provided in Section 12, above. Extension of the Use Agreement for a successive term shall occur automatically if neither party gives notice to terminate or amend the Use Agreement.
19 . SAVING.
If any provision hereof shall be held to be invalid, or unenforceable in any application, the remainder of this Use Agreement shall remain in full force and effect as though such provision had never been included herein, and if such provision has instead been held unenforceable in any application, such provision shall remain in full force and effect for all other applications.