The plain meaning of English is the basis of statutory interpretation.
"if neither of the units is occupied by the property owner, the approval of the second dwelling unit shall terminate immediately and the unit shall not be rented, leased or ocupied as a separate dwelling. "
1. if neither of the units is occupied by the property owner, the approval of the second dwelling unit shall terminate immediately and the unit shall not be rented, leased or ocupied as a separate dwelling.
without "and ...", then 1. rental 2. rental not OKAY. Owner should lock up the MIL unit when renting out.
2. if neither of the units is occupied by the property owner, the approval of the second dwelling unit shall terminate immediately and the unit shall not be rented, leased or ocupied as a separate dwelling.
But with "and ...", it merely prohibits renting ... "as a separate dwelling", so one would argue that renting as one dwelling with the main house is allowable.