ASSEMBLY, No. 1181
STATE OF NEW JERSEY
Introduced Pending Technical Review by Legislative Counsel
PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION
By Assemblyman DALTON
An Act concerning the rights and obligations of manufactured mobile home owners and manufactured housing community operators, supplementing chapter 8C of Title 46 and repealing section 4 of P.L.1973, c.153 (C.46:8C-4) and section 2 of P.L.1983, c.399 (C.46:8C-9).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. This act shall be known and may be cited as the "Manufactured Home Owner's Bill of Rights."
2. The Legislature finds that:
Unregulated market forces result in unfair and unconscionable practices in manufactured housing community tenancies and that, once a home is situated on a community site, the difficulty and cost of moving the home gives the community operator disproportionate power in setting the rent, fees, rules, and other aspects of the tenancy. In addition, the shortage of community spaces, existing law as to eviction rights, community operator restrictions of a homeowner's sale of his home, and changes in the land use of the community by the community owner exacerbate these homeowners' problems. This legislation protects homeowners from community operator abuses and provides homeowners a minimum of security in their homes.
3. As used in this act:
"Community operator" means an owner or manager of a manufactured housing community, including community employees and any subsequent purchaser of a community.
"Homeowner" is a person owning a manufactured home who has a tenancy in a manufactured housing community under a rental agreement. The term shall not include a person dwelling in an apartment under a rental agreement.
"Homeowner association" means any organization of homeowners of the community, which is organized for the purpose of resolving matters relating to living conditions in the manufactured housing community.
"Rental agreement" means any agreement or lease between a community operator and a homeowner establishing the terms and conditions whereby a manufactured home is placed upon a rented or leased lot in a manufactured housing community.
"Manufactured home" is as defined in section 3 of P.L.1983, c.400 (C.54:4-1.4).
"Manufactured housing community" or "community" means a use of land in which four or more lots or spaces are offered for rent or lease for the placement of manufactured housing and in which the primary use of the community or the manufactured home section in the community is residential.
4. A community operator shall not:
a. Engage in unfair or deceptive acts or practices or unfair methods of competition.
b. Require, as a condition to the rental of any site, the purchase of a manufactured home from the community operator, or any dealer, manufacturer, or agent named by the operator.
c. Represent to any person that the purchase of a manufactured home from the community operator or any dealer, manufacturer, or agent named by the operator will give the purchaser an advantage over others in the rental or continued occupancy of a site.
d. Discriminate or threaten to discriminate regarding the amount of rental charges or in any other respect against a homeowner for failure of the homeowner to purchase a manufactured home from the operator or any dealer, manufacturer or agent named by the operator.
e. Solicit or receive any payment or other thing of value from any person upon the representation or understanding that such consideration will give that person an advantage over others in the rental or continued occupancy of a site.
f. Use a manufactured housing community site to display an unoccupied manufactured home offered for sale, or rent a site to a manufactured housing dealer for purposes other than accommodation of a manufactured home occupied as a residence, if the use or rental of the site results in there being no site in the manufactured housing community available to a prospective homeowner who does not purchase a manufactured home from the operator or renting dealer.
g. Contract for capital improvements of more than $5,000 without making a good faith effort to obtain the most economical offer of services. The dollar amount of the capital improvement agreed to shall be disclosed to the homeowners.
h. Using an unsatisfactory credit history as a basis for denying occupancy of a site by a prospective homeowner in the community unless a credit report shows a history of habitual late payments which shall mean more than six in any two year period, or a bankruptcy or judgment in the two years prior to the application by the prospective homeowner.
5. The provisions of this section shall not supercede a previously adopted municipal rent control ordinances or any prospective rent control ordinance, rent stabilization agreement or the decisions of a rent control board which pertain to manufactured or mobil home parks.
a. All rental agreements shall be for a minimum term of one year to a maximum term of five years at the discretion of the homeowner.
b. The homeowner who executes a rental agreement offered pursuant to this section may cancel such agreement by notifying the community operator in writing within seven days of the homeowner's execution of the rental agreement.
c. The maximum amount that a community operator may set and seek as damages for a homeowner's early termination of a rental agreement is two months' rent, except that if the manufactured housing space is reoccupied with 20 days of vacating, the damages shall be a maximum of one month's rent.
d. During the first rental term, the community operator may propose whatever rental amount it chooses, including rental increases, as long as the amounts or methods of determining the rental amounts and increases are fully and clearly substantiated and disclosed in the rental agreement, are not unreasonable, and are binding on the community operator for the term of the rental agreement.
e. The community operator may require, at the inception of the homeowner's first rental agreement, a security deposit not exceeding one month's rental. The security deposit shall be deposited in a State or federally chartered bank, savings bank, or savings and loan association in this State insured by an agency of the federal government in an account bearing interest at the rate currently paid by such institutions and associations on time or savings deposits. The security deposit with interest shall be returned to the homeowner when the lease is terminated provided that the homeowner has paid in full all rent and other charges due, has caused no or only minimal damage to the leased premises, and has left the lot reasonably clean and free of debris. Within 15 days of the termination of the rental agreement, the community operator shall provide the homeowner with an itemized list of charges due and damages to the premises and the estimated cost of repair for each, and tender payment for the difference between the security deposit and the charges due and estimated cost of repair of damages to the premises. Failure to comply with this subsection shall constitute admission by the community operator that no damages are due, and the community operator shall immediately remit to the homeowner the full amount of the security deposit.
f. At the expiration of a rental agreement, the agreement will be automatically renewed for a term of five years with the same terms as the previous rental agreement, unless the homeowner notified the community operator at least 30 days prior to the agreement's termination of an intent to move or the community operator seeks to change the terms of the agreement pursuant to subsections g. and h. of this section.
g. Six months prior to the end of a rental term in a community, the operator shall offer the homeowner a renewal rental agreement with a term of at least five years with a proposed rental amount and any fee or other lease changes for that term.
h. If the homeowner does not accept the new terms, the community operator may initiate a binding appraisal process, pursuant to section 15 of this act, at which time an appraiser mutually agreed upon by the homeowner and community operator shall determine the fair market value of the lot rent and other charges over the next five years, based on the existing rental agreements applicable to other manufactured homes of other homeowners in other sections of the same community. The amount determined by the appraiser, including any built-in increases, shall be binding for the next five year period.
i. Homeowners with existing rental agreements not complying with this act shall, as soon as practical, be offered a five-year rental agreement complying with this act, effective on the termination of their existing rental agreement. If the homeowner does not accept the terms, the homeowner may initiate a binding appraisal process pursuant to section 15 of this act, at which time an appraiser mutually agreed upon by the homeowner and community operator shall determine the fair market value of the lot rent and other charges over the next five years, based on new rental agreements applicable to other manufactured homes of other homeowners in the same section of the same community, and, if necessary, new rental agreements in other comparable communities. The amount determined by the appraiser, including any rental increases, shall be binding for the five year period.
j. During the term of the rental agreement, if the community operator decreases any services which the community operator agreed to provide in the rental agreement, the community operator shall reduce the rental amount accordingly. If the community operator fails to comply with the requirements of this subsection, individual homeowners or a homeowner association may initiate a binding arbitration proceeding, pursuant to section 15, to determine the appropriate reduction in rent, and to determine the amount of the refund, if any, the community operator may owe homeowners for excess rent payments charged.
6. a. The community operator shall not charge homeowners any fees or charges other than the monthly rent charge, except for use-based charges that are set out in the rental agreement. As used in this section, use-based charges are charges for services, facilities, or capital improvements that are based on the amount of a homeowner's use of a particular service, facility or capital improvement. A charge is not use-based if a homeowner is charged even when he does not use the service, facility, or capital improvement, or if different homeowners are assessed the same charge for using different levels of service, facilities, or capital improvements.
b. Charges for existing use-based services or facilities shall be included in the terms of the rental agreement, and can only be increased as provided in the rental agreement. Any increase shall be reasonably related to the increases in the community operator's costs for those services or facilities.
c. The following fees are specifically prohibited and any rental agreement provision establishing such fees is void:
(1) Entrance and exit fees.
(2) Fees for a homeowner's resale of the home, assignment of the lease, or sublet of the home.
(3) Fees for additional family members.
(4) Short-term guest fees.
(5) Pet fees, unless special facilities are provided for pets or additional costs are incurred for maintenance of grounds.
d. The community operator may charge a penalty for late payment of rent or other fees after such payments are 15 days delinquent. Such late charge shall not exceed five percent of the amount owed and may be imposed only once for a particular payment.
e. A community operator's utility service charge may not exceed prevailing residential utility rates in the vicinity, must be use-based as provided in subsection b. of this section, and shall be periodically invoiced in writing, specifying the charge, the rate, and the amount of the utility service used. The community operator shall post in a conspicuous place the prevailing residential utilities rate schedule as published by the serving utility.
f. No community operator shall restrict the choice of vendors from whom a homeowner may purchase goods or services, or in any other way engage in conduct that discourages homeowners from selecting the vendor of their choice. This subsection shall not apply to:
(1) Snow removal, lawn care, or similar site maintenance services performed by the community operator, upon the failure of a homeowner to fulfill the homeowner's site obligations under the rental agreement. No charges may be imposed for site maintenance services performed by the operator under this paragraph unless the homeowner, if available, is given prior notice and a reasonable opportunity to perform the homeowner's obligation under the rental agreement. Charges for site maintenance services shall be set forth in the rental agreement, and shall be reasonable and limited to the community operator's actual costs.
(2) A non-discriminatory prohibition against sales solicitations within the manufactured housing community.
7. a. The community operator may promulgate rules governing the rental occupancy of a manufactured home lot and the use of common areas and facilities, but no such rule shall be unreasonable, unfair, or unconscionable.
b. Any rule which does not apply uniformly to all manufactured home homeowners of a similar class shall create a rebuttable presumption that the rule or change in the rule is unfair.
c. Each common area facility shall be open or available to homeowners at all reasonable hours and the hours of the common recreational facility shall be posted at the facility.
d. If a bona fide homeowner association exists for a community, then no rule or rule change shall be implemented without the approval of the organization. If approval is withheld, the community operator may initiate an arbitration procedure with the homeowner association pursuant to section 15 of this act. If the arbitrator finds that the rule or rule change is unreasonable, unfair, or unconscionable, it shall not be implemented without the consent of the association. If no homeowner association exists, the rule or rule change shall be submitted directly to the Department of Community Affairs for review and prior approval. Any party in interest may appeal the approval or failure to approve to a court of appropriate jurisdiction.
e. Except in a bona fide emergency, no rule or rule change shall be effective until at least 60 days after the homeowners receive notice of the change.
f. Anytime a rule is enforced against a homeowner, the homeowner may seek judicial review of the rule.
8. a. All rental agreements and renewal agreements shall be in writing and signed by the community operator or manager and the homeowner. The community operator shall give the homeowner a copy of the community's standard rental agreement, with all community rules and attachments, and the pamphlet required by subsection e. of this section, at the time the prospective homeowner initially contacts the community concerning a prospective vacancy. The community operator shall also give the homeowner a completed agreement after the rental agreement has been signed.
b. Any rental agreement or renewal agreement shall contain, but is not limited to, the following provisions:
(1) The rental term, which shall be at least five years, and a statement of the homeowner's right to a five-year renewal agreement at a fair market rental value.
(2) The monthly rental amount and the method for specifically determining the amount of any changes in rent over the lease term. If the rent amount changes over the term of the lease, and the lease does not specify the dollar amount of the subsequent rent levels, the rental agreement shall clearly set forth the formula or method for determining those changes, and must also give clear and realistic examples of how such formula or method would work in each year of the lease term.
(3) The rules of the community.
(4) A warranty of habitability, as specified in section 9 of this act.
(5) A description of the community operator's maintenance responsibilities.
(6) A list of facilities and services which the community operator will provide.
(7) Any late charges, fees, or charges for services, including any increases during the term of the lease. If the amount of fees or charges change over the term of the lease, and the lease does not specify the dollar amount of the subsequent levels of fees or charges, the rental agreement must clearly set forth the formula or method for determining those charges, and must also give clear and realistic examples of how this formula or method would work in each year of the lease term.
(8) Disclosure of the community operator's reservation of the right to evict a homeowner for a change in the use of the property during the lease term.
(9) If there is a temporary zoning permit for the use of the land, the date when the zoning permit expires.
(10) A description of the homeowner's manufactured home site and its address or site number, and the number and location of any accompanying automobile parking spaces.
(11) The community operator's name and address for the delivery of all official notices and also the name and telephone number of the individual who can be contacted for emergency maintenance, pursuant to subsection c. of section 9 of this act.
(12) The amount of any security deposit imposed by the community operator.
(13) Any penalties the community operator may impose for the homeowner's early termination.
(14) The grounds for eviction.
(15) All other terms or conditions of occupancy.
(16) A prominent disclosure that the homeowner's rights and community operator's obligations are set out in a pamphlet attached to the rental agreement.
(17) A prominent disclosure that the homeowner can cancel the rental agreement with no obligation for the next seven days after signing the agreement.
c. Any provision for rent increases or increases in fees over the term of the lease shall be initialed by the homeowner.
d. The rental agreement shall be clearly written in understandable language, in at least ten-point type, by a typewriter or word processor, in a form and presentation approved by the Department of Community Affairs.
e. The Department of Community Affairs shall produce and disseminate within 90 days of the effective date of this act a pamphlet setting forth clearly and in detail the homeowners' and community operators' rights and obligations as set forth in this act.
f. A community operator shall attach one copy of the pamphlet specified in subsection e. of this section to each rental agreement.
g. No rental agreement shall contain any terms which are illegal, unfair, unconscionable, or unenforceable.
9. a. In any rental agreement, the community operator is deemed to covenant and warrant that the space and its associated facilities are fit for human habitation.
b. The community operator shall:
(1) Comply with codes, statutes, ordinances, and administrative rules applicable to the manufactured housing community;
(2) Maintain all common areas of the community in a clean and safe condition;
(3) Maintain in good working order all electrical, plumbing, sanitary, and appliances and recreational facilities which it furnishes;
(4) Maintain and protect all utilities provided to the manufactured home and keep water and sewer lines in good working condition. Maintenance responsibility shall extend to ensuring that the normal manufactured home utility "hookups" connect to those provided by the community operator or utility company;
(5) Maintain in a safe and secure location individual mailboxes for the homeowners;
(6) Maintain roads within the manufactured housing community in good and safe condition including snow removal, adequate drainage, and water supply, and be responsible for damage to any vehicle which is the direct result of any unrepaired or poorly maintained access road within the community;
(7) Take reasonable steps to exterminate rodents, vermin, or other pests dangerous to the health and safety of the homeowners whenever infestation exists on the common premises or in the interior of a manufactured home as a result of infestation existing on the common premises;
(8) Maintain the premises and regrade them when necessary to prevent the accumulation of stagnant water and the detrimental effects of moving water;
(9) Take all necessary steps to maintain the integrity of the foundation of the homeowner's manufactured home;
(10) Keep the common areas of the community free from any species of plant growth which are noxious or detrimental to the health of the homeowners while protecting the integrity of desirable plant growth on lots in the community;
(11) Provide suitable containers and arrange for and assume the cost for the removal of garbage, rubbish, and other waste incidental to the occupancy of the manufactured housing space.
(12) Provide the homeowners, upon request, with written status reports on repairs and other maintenance either pending or in progress along with written estimates of completion dates;
(13) Make available to any person making a request, at reasonable times, the operator's current listing of any manufactured homes in the community that are available for purchase; and
(14) Disclose to any prospective homeowners any hazardous substances underneath or in the immediate vicinity of the property on which the manufactured home is placed including underground oil tanks.
c. The community operator shall authorize a manager, assistant manager, or other employee to make repairs that are the responsibility of the community operator or enter into a contract with a third party for such repairs. The community operator shall contract with a third party to provide emergency repairs that are the responsibility of the community operator on occasions when the manager, assistant manager, or other designated employee are not physically present in the community, and shall notify each homeowner of the telephone number at which such third party may be reached directly.
d. If the community operator fails to comply with subsection a., b. or c., the homeowner may recover damages pursuant to the procedure set forth in section 16 of this act. The homeowner may also opt to notify the community operator of the homeowner's intention to correct the condition at the community operator's expense. After being notified by the homeowner in writing, if the community operator fails to comply within 15 days or more promptly as conditions reasonably require in case of emergency, the homeowner may cause the work to be done by a contractor or by the homeowner himself and, after submitting to the community operator an itemized statement, deduct from the homeowner's rent the actual and reasonable cost of the work.
10. a. The owners of manufactured homes in a community may organize as a corporation or association either for profit or not for profit. The membership of a homeowner association may elect officers of the association at a meeting at which a majority of members are present. All homeowners may attend meetings, but the community operator and his employees shall not be members and shall not attend meetings unless specifically invited to a particular part of a meeting. A homeowner association may not impose fees or dues upon its members or the homeowners unless a majority of the members or homeowners agree to the specific fees or dues. No officer or member of a homeowner association shall be personally financially responsible for the acts or omissions of the association or any other officers or members of the association. If the owners of manufactured homes in a community form an association in order to purchase the community, they shall do so in accordance with P.L.1991, c.483 (C.46:8C-10 et seq.).
b. It shall be unlawful for a community operator to increase a homeowner's rent or decrease services, change community rules, bring or threaten to bring an action for eviction or other civil action, or take any other action because, or in retaliation after:
(1) The homeowner has expressed an intention to complain or has complained to a governmental agency about conditions in the community.
(2) The homeowner has made any complaint in good faith to the community operator.
(3) The homeowner has filed or expressed an intention to file a lawsuit or administrative action against the community operator.
(4) The homeowner has organized or is a member of a homeowner association.
(5) The homeowner has performed or expressed an intent to perform any other act for the purpose of asserting, protecting or invoking the protection of any right secured to homeowners under any federal or state law or municipal ordinance.
c. Any attempt to evict a homeowner, except for nonpayment of rent, within six months after the homeowner has taken action as described in paragraph (5) of subsection b. of this section shall create a rebuttal presumption that the eviction action is in retaliation against the homeowner.
d. No community operator shall harass or threaten any homeowner association, or engage in any unfair or deceptive conduct to inhibit or interfere with the creation or operation of the association by the homeowners.
e. The community operator shall meet and consult with homeowners upon written request, either individually, collectively, or with representatives of a group of homeowners who have signed a request to be so represented on the following matters:
(1) Amendments to community rules and regulations.
(2) Standards for maintenance of physical improvements in the community.
(3) Addition, alteration or deletion of services, equipment or physical improvements.
f. Except in the case of an emergency or when the homeowner has abandoned the manufactured home, the community operator shall have no right of entry to a manufactured home without the prior written consent of the homeowner. This consent may be revoked in writing by the homeowner at any time. The community operator shall have a right of entry upon the land where a manufactured home is situated for maintenance of utilities, for maintenance of the premises, and protection of the manufactured housing community, at any reasonable time, but not in a manner or at a time which would interfere with the homeowner's quiet enjoyment of his property.
11. a. The community operator may terminate the rental agreement only by following the procedures as provided in subsection d. of this section and only for one or more of the following reasons:
(1) Nonpayment of rent, as specified in subsection b. of this section.
(2) Violation of a community rule as specified in subsection c. of this section.
(3) Disorderly conduct that results in disruption of the rights of others to the peaceful enjoyment and use of the premises, endangers other homeowners or community personnel or causes substantial damage to the community premises.
(4) The homeowner's conviction of a crime, commission of which threatens the health, safety, or welfare of the other homeowners or the community operator, all as specified in subsection c.
(5) Changes in the use of the land if the requirements of section 13 of this act are met.
b. No community operator may institute eviction procedures as provided in subsection d. of this section for non-payment of rent until 45 days have elapsed from the date the homeowner receives notice that rent is delinquent, and only if the homeowner has not tendered that delinquent payment during that 45 day period. Nonpayment of any fees or late charges shall not be grounds for eviction. Any payment made by a homeowner to a community operator shall be allocated first to delinquent rent payments, then to current rent payments, and last to fees, charges, or late fees.
c. Violation of a community rule or regulation shall be grounds for eviction only if the rule has been properly promulgated pursuant to section 7 of this act, the rule is not unfair, unreasonable, or unconscionable, the homeowner has had at least 60 days' notice of the rule before the violation took place; the rule violation is likely to continue or recur; and the continuing violation or recurrence would have a significant adverse impact on the community or its homeowners. The conduct set out in subparagraph (3) of subsection a. shall be grounds for eviction only if there is a likelihood of future conduct that would also be grounds for eviction pursuant to that subsection. There is no such likelihood if the conduct or conviction was committed by a member of the homeowner's household, and not by the homeowner, and such other person is no longer living in the home and is not likely to return to the home.
d. The community operator may terminate the rental agreement or evict the homeowner only by instituting an action in Superior Court. The court shall determine if the grounds for eviction as provided in this section have been met. No eviction shall be ordered if the court determines that the eviction proceeding is in retaliation for the homeowner's conduct, as provided in subsection b. of section 10 of this act.
e. In any eviction action for non-payment of rent, the homeowner shall be entitled to raise, by defense or counterclaim, any claim against the community operator relating to or arising out of such tenancy for breach of warranty, for breach of the rental agreement, or violation of any law. The amounts which the homeowner may claim under this subsection shall include, but shall not be limited to, the difference between the agreed-upon rent and the fair value of the use and occupation of the manufactured home lot, any amounts reasonably spent by the homeowner to repair defects in the manufactured housing community and any damages as provided in section 16 of this act. The court, after hearing the case, may require the homeowner raising a claim under this section to deposit with the clerk of the court an amount equal to the fair value of the use and occupation of the premises less the amount awarded the homeowner for any claim under this section, or such installments thereof from time to time as the court may direct, for the occupation of the premises. These funds may be expended for the repair of the premises by the persons as the court after hearing may direct, including, if appropriate, a receiver. When all of the conditions found by the court have been corrected, the court shall direct that the balance of funds, if any, remaining with the clerk be paid to the community operator.
f. Any court order for eviction based on the homeowner's nonpayment of rent shall specify that the sheriff or constable shall not serve an eviction notice for at least 30 days after the court order and that the homeowner can cure the eviction order by paying the full amount due up until the time the homeowner is actually evicted by the sheriff or constable. A court order for eviction for reasons other than non-payment of rent may specify conditions whereby the homeowner can cure the violation and remain in the tenancy.
g. Notwithstanding the provisions of N.J.S.12A:9-503, a secured party, in taking possession of a manufactured home, must proceed through judicial process.
h. A homeowner who has been evicted from the community shall have 180 days in which to sell his manufactured home in the community. The homeowner shall be responsible for paying the rental amount during that period and for regular maintenance of the manufactured home lot during such 180-day period. The community shall have a lien on the home to the extent these payments are not made or the maintenance is not performed, and during that period no one may reside in the home.
12. a. No community operator shall limit the sale of manufactured homes on the basis of the home's age or physical condition or in any way misrepresent that such homes may not be sold.
b. No community operator or employee of the community shall act as agent or broker in the sale of a homeowner's manufactured home, nor shall the community operator or employee exact a commission or fee from the sales of any home owned by a homeowner.
c. No community operator shall place unreasonable, unfair, or discriminatory restrictions on "For Sale" signs or on access to the community by prospective purchasers or realtors, or interfere with a homeowner's efforts to sell a manufactured home.
d. Except as specified in subsections e. and f., a homeowner shall have the right to assign the rental agreement to the purchaser of the homeowner's manufactured home, or to sublease the manufactured home site.
e. Notwithstanding the provisions of section 3 of P.L.1973, c.153 (C.46:8C-3) to the contrary, the homeowner shall give the community operator notice of any assignment or sublease, and the community operator may disapprove of the assignment or sublease only, if within seven calendar days, it gives the homeowner written notice of the disapproval, with the reasons for the disapproval stated therein, provided that such disapproval shall be only for the reasons as provided in subsection f. of this section.
f. The community operator may disapprove the assignment of a rental agreement or a sublease only if the assignee or sublessee does not have the financial ability to pay the rental amount or would pose an unreasonable hazard to the safety or peaceful enjoyment of the homeowners of the manufactured housing community. The age or condition of the manufactured home shall not be grounds for disapproving an assignment or sublease. The community operator shall not impose an application or other fee on the prospective assignee or sublessee. The community operator shall not disapprove an assignment from the homeowner to the homeowner's bonafide creditor.
g. The homeowner or prospective sublessee or assignee may seek judicial review of the community operator's disapproval, and the burden shall be on the community operator to prove that the disapproval was for reasons permitted by subsection f. and that such disapproval was objectively reasonable and in good faith. If the court finds that the disapproval was not justified, the court shall order the assignment or sublease of the rental agreement and award any actual damages, costs, and reasonable attorney's fees to the homeowner or prospective sublessee or assignee. If the court finds that the disapproval by the community operator was not in good faith, the court shall instead award treble damages, but no less than two months' rent, costs, and attorney's fees.
13. a. The community operator may terminate a rental agreement in order to change the community's land use only if all of the following conditions are met:
(1) the rental agreement or renewal agreement clearly and conspicuously discloses a change in land use as a ground for terminating the rental agreement;
(2) notice is sent to the homeowner as specified in subsection b. of this section;
(3) payment has been made to the homeowner pursuant to subsection c. of this section or the homeowner's home has been relocated, pursuant to subsection d. of this section; and
(4) the community operator has a present intent to change the land use to a use other than a manufactured housing community.
b. To terminate a rental agreement for a change in land use, the community operator must send notice to a homeowner at least 18 months before the change in land use, specifying the date of the proposed changed land use. The homeowner, at any time during the next 12 months, may elect to sell the home to the community for its fair market value as determined by an independent appraiser, or to have the community operator, at his expense, relocate the home, pursuant to subsection d., to another community within a 100 mile radius. The homeowner may specify the date of the sale or relocation. The notice shall also inform the homeowner that the homeowner may elect the date of the home sale or relocation at any time from receipt of the notice until the date of the changed land use. If the homeowner has not made this election within 12 months, the community operator may make the election without six months' notice to the homeowner.
c. If purchase of the manufactured home by the community operator is elected, the purchase price, unless the parties agree otherwise, shall be determined by an appraiser agreed upon by the homeowner and the community operator. The purchase price shall be based on the home's fair market retail value, as presently sited, with all appurtenances thereto. The fair market value shall take into account the siting of the manufactured home.
d. If relocation of the manufactured home is elected, the community operator shall bear the full cost and responsibility to disconnect and move the home, transport it to the new site selected by the homeowner, and re-site the home with all hookups so that it is substantially in the same condition as before the move, with any required and comparable appurtenances. The community operator shall be responsible for all repairs to bring the home to its former condition, as well as suitable substitute lodging for the homeowner until the move and repairs are completed.
14. a. The Commissioner of Community Affairs shall submit a report to the Legislature within six months of the effective date of this act delineating any legal impediments presently existing in State law to cooperative, condominium or other similar purchase of manufactured housing communities by homeowner associations or other groups of homeowners, and proposing the legal changes necessary to remove those impediments.
b. The commissioner shall prepare a report for dissemination at a minimal charge to the public compiling information from other states on successful approaches and methods for homeowner associations and other groups of homeowners to purchase manufactured housing communities.
15. a. If the homeowner or homeowner association and the community operator fail to select an appraiser or arbitrator pursuant to subsections h., i., and j. of section 5, subsection d. of section 7, or subsection c. of section 13 of this act, the court, upon application of a party, shall appoint an arbitrator or appraiser.
b. The arbitrator or appraiser decision shall be a signed written document, with copies provided to each party. The decision shall apportion expenses and other fees incurred between the parties as is equitable, except that the fees for the arbitrator or appraiser shall be divided equally by the two parties.
c. Parties have the right in the arbitration or appraisal procedure to be represented by attorneys or, in the case of the homeowner, by the homeowner association.
d. Upon application of a party, a court may vacate, modify or correct a decision if the decision was procured by undue means; there was evident partiality of an appraiser or arbitrator, or misconduct prejudicial to the rights of a party; the arbitrator or appraiser exceeded his powers; or the decision was demonstrably irrational. If the court vacates a decision, it shall appoint a new arbitrator or appraiser.
16. a. A community operator who fails to comply with any requirement of this act shall be liable to a homeowner, an applicant for residency, or a homeowner association for the sum of:
(1) any actual damage, including any emotional distress, sustained by that homeowner, applicant for residency, or homeowner association;
(2) in the case of an individual action, twice the monthly rental amount; in the case of a class action, one month's rent for each class member; in the case of an action by a homeowner association, the sum of $1,000;
(3) the homeowner or homeowner association's reasonable attorney's fees and costs, including an upward multiplier of the fees to account for the contingent nature or other risk of the litigation.
b. The court shall have authority to order temporary and permanent injunctive relief and such other equitable relief as may be appropriate, including appointment of a receiver to operate the community, if necessary.
c. Whenever a court determines that a community operator's violation is willful or reckless, or if a court finds that the community operator has not attempted to resolve the dispute in good faith, the court shall award at least treble actual damages in addition to the relief specified in subparagraphs (2) and (3) of paragraph (a) of this section, and may in its discretion award punitive damages greater than treble actual damages. There shall be a presumption that any attempt to unlawfully evict a homeowner or terminate utility service, or prevent the homeowner from entering the homeowner's home is a willful or reckless violation of section 11 of this act.
d. In addition to any damages which may be awarded under a claim of frivolous action, if the court finds that the action brought by the homeowner or homeowner association was brought in bad faith, knowing that the action was groundless, and was brought for purpose of harassment, the court shall award the community operator reasonable attorney's fees, but only as necessary to defend the action relating to this act.
e. The provisions of this act shall not bar any claim against any person.
f. For purposes of a homeowner enforcing rights under the rental agreement, all terms required by this act to be included in the rental agreement shall be deemed as a matter of law to be part of the rental agreement, whether incorporated in the actual agreement or not.
g. A homeowner shall have a lien against the realty on which his manufactured house is situated for amounts owed the homeowner pursuant to section 13 or 16 of this act, for the cost of any relocation that the community operator is obligated to perform under section 13 of this act but fails to perform or complete, and for all costs and fees associated with enforcing this obligation.
h. The rights of homeowners or obligations of community operators under this act shall not be waived by any provision of the rental agreement, the community rules, or any attachments to them. In addition to the remedies specified in this section and section 17, any agreement attempting to limit these rights shall be void and unenforceable. Any rights of a homeowner or obligation of a community operator may be settled by means of a written compromise that is knowingly, intelligently, and voluntarily entered into by a homeowner. A compromise is presumed to be knowing, intelligent, and voluntary only if the homeowner was represented by an attorney
in executing the compromise.
17. a. The Attorney General or the county prosecutor may seek temporary and permanent injunctions for any violation of this act, civil penalties in the amount of $10,000 per violation, or restitution on behalf of all homeowners or homeowner associations injured by the violation. In any such successful action, the court shall award costs and attorney's fees to the prevailing party.
b. The court may award civil penalties in the amount of $10,000 per violation for any violation of an injunction ordered pursuant to subsection a. of this section.
c. Whenever a community operator does not have the financial capacity to operate the community or when it is the most effective means of insuring compliance with court orders, the court may order a receiver to operate the community.
d. The Attorney General or the county prosecutor may use, whenever deemed within the public interest, all of the respective agency's investigatory powers, including subpoena, investigative demand, and similar investigatory powers.
18. The Commissioner of Community Affairs shall adopt rules and regulations pursuant to the Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), as may be necessary to effectuate the purposes of this act.
19. To the extent that the provisions of this act conflict or are inconsistent with the provisions of P.L.1973, c.153, the provisions of this act shall supercede them.
20. Section 4 of P.L.1973, c. 153 (C.46:8C-4) and section 2 of P.L.1983, c. 399 (C.46:8C-9) are repealed.
21. This act shall take effect on the first day of the seventh month after enactment.
STATEMENT
Mobile home owners in manufactured housing communities are a largely unprotected population. They are in an unequal bargaining position with the housing community owners, owning their homes, but renting the land on which they are placed. These home owners are often victims of unconscionable rent increases, restrictive community policies and unfair business practices.
Up to this time, New Jersey, like a majority of states, have addressed only pieces of the problem. This bill, entitled the "Manufactured Home Owner's Bill of Rights" is based on a comprehensive model statute developed by the National Consumer Law Center at the request of the American Association of Retired Persons. It provides potential solutions for some of the most pressing problems faced by manufactured housing community homeowners.
The shortage of rental sites combined with the immobility of "mobile" homes ($10,000 to $15,000 is an estimated cost to move one) gives housing manufactured community owners extraordinary leverage to maintain their grounds as they desire, exact large increases in rents and other fees and to establish sometimes unreasonable ground rules for everyday living. This bill recognizes that manufactured home owners are not "tenants" who can pack their bags and leave when a dispute arises with a community operator.
The bill's core provision is a one to five-year renewable lease requirement that restores some measure of balance in the economic relationship between the community operator and the manufactured home owner. Long term leases are already an acceptable feature of commercial practice when a tenant has a substantial investment in a particular location. Homeowners would have the right to renew their leases at market rates -- at the same levels as those paid by other, newer homeowners in the same community. Coupled with provisions for arbitration and private remedies, the bill would empower homeowners to negotiate key issues of tenancy such as rent and lease terms directly with community owners. The bill permits owners of manufactured homes to form associations for the purpose of protecting the rights of the homeowners in the housing community.
The bill further prohibits a host of unfair and deceptive practices and assists homeowners in remedying housing community maintenance problems. Since the State has limited resources for enforcement, the bill also provides for the awarding of attorney's fees to prevailing parties, binding appraisal to determine rent levels, and a variety of statutory and punitive damages to deter violations.
This bill should be viewed as the opening, rather than a finale, of a long-term effort to better serve the needs of homeowners in manufactured housing communities.
The "Manufactured Home Owner's Bill of Rights."