I just bought a house in Seattle with a Pacific madrone in the back yard. Lovely tree, but it has hauled off and starting shedding yellow leaves like mad. Another writer said his sheds leaves in July, so I'm hoping/praying this is what it's supposed to be doing?
Falling leaves Yes, the arbutus sheds its older leaves in summer. This is completely normal! While it is a bit of a bother to have to rake leaves in summer, know that your tree will reward you with glistening fresh leaves all winter, while most non-coniferous trees are bare. Benign neglect is the best way to keep an arbutus in healthy condition. Avoid pruning it, and don't water it (I hope it is not near a lawn - irrigating in summer can encourage root rot!). Arbutus have suffered in the Pacific Northwest from a condition called "Arbutus decline". This leads to an increased susceptibility to foliar diseases, stem cankering, etc. Declining trees take several years to die - it is a sad sight. But you can keep your arbutus healthy by letting mother nature take care of it. Many problems are brought upon these trees by well-intentioned gardeners who over-water, over-fertilize (they don't need any!), needlessly prune, and re-landscape around the tree, which disturbs the fine balance between the tree's root system and the environment. Mature trees often decline when they are retained during new home construction because not enough care is taken to protect the root system from disturbance, or changes to the water table. Good luck with your tree.