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prescribed in regulations of the Secretary, and may include inundation from rising waters or from the overflow of streams, rivers, or other bodies of water, and from tidal surges, abnormally high tidal water, tidal waves, tsunamis, hurricanes, and other severe storms or deluge; (2) "United States" and "State" include the several States, the District of Columbia, the territories and possessions, the Commonwealth of Puerto Rico, and the Trust Territory of the Pacific Islands; (3) "insurance company," "other insurer," and "insurance agents and brokers," include organizations or individuals authorized to engage in the insurance business under the laws of any State; (4) "insurance adjustment organization" includes organizations or individuals engaged in the business of adjusting loss claims arising under insurance policies issued by any insurance company or other insurer; (5) "person" includes any individual, group of individuals, corporation, partnership, association, or other organized group, including State and local governments and agencies; and (6) "Secretary" means the Secretary of Housing and Urban Development.
Section 1371. Studies of other natural disasters
Subsection (a) authorizes the Secretary to make studies to determine the extent to which insurance protection against earthquakes or other natural disasters is not available and the feasibility of making such insurance protection available.
Subsection (b) provides that, to the maximum extent practicable, these studies will be made in cooperation with other Federal, State, or local agencies, and the Secretary is authorized to enter into agreements for the conduct of such studies with other Federal agencies, on a reimbursement basis, and with State and local agencies.
Section 1372. Payments
This section vests discretion in the Secretary to make payments in advance of their actual need, or by way of reimbursement, with appropriate adjustment for previous overpayments or underpayments. Section 1373. Government Corporation Control Act
This section makes the provisions of the Government Corporation Control Act applicable in the administration of the flood insurance program to the same extent as they are applicable to wholly owned Government corporations.
Section 1374. Finality of certain financial transactions
This section provides that any financial transaction under the bill, and any payment received or made in connection with it, shall be final and conclusive upon all officers of the Government.
Section 1375. Administrative expenses
This section provides that any administrative expenses of the Federal Government in carrying out the flood insurance program may be paid out of appropriated funds.
Section 1376. Appropriations
This section authorizes, without fiscal year limitation, the appropriations necessary to carry out the flood insurance program, including sums to cover administrative expenses and to reimburse the national flood insurance fund for premium equalization payments and reinsurance claims paid out of the fund.
Section 1377. Effective date
This section provides that this title shall take effect 120 days following the date of its enactment except that, if necessary, the Secretary may prescribe a later effective date up to a maximum of 180 days from the date of enactment.
TITLE XIV-INTERSTATE LAND SALES
Section 1401. Short title
This section provides that this title may be cited as "The Interstate Land Sales Full Disclosure Act".
Section 1402. Definitions
This section defines the following: (1) "Secretary" to mean the Secretary of Housing and Urban Development; (2) "person" to mean an individual, or an unincorporated organization, partnership, association, corporation, trust, or estate; (3) "subdivision" to mean any land which is divided or proposed to be divided into 50 or more lots, whether contiguous or not, for sale or lease as part of a common promotional plan, and creates a presumption of a common promotional plan where land, which is contiguous or is known, designated, or advertised as a common unit or by a common name, is offered for sale or lease by a developer, or group of developers acting in concert, without regard to the number of lots covered by each individual offering; (4) "developer" to mean any person who sells or leases, or offers or advertises to sell or lease, any lots in a subdivision; (5) "agent" to mean any person who represents or acts for or on behalf of a developer in selling, leasing, or offering to sell or lease, any lot or lots in a subdivision; (6) "blanket encumbrance" to mean a trust deed, mortgage, judgment or other lien or encumbrance affecting a subdivision or more than one lot in a subdivision, excluding any lien or encumbrance resulting from the imposition of a tax assessment by any public authority; (7) "interstate commerce" to mean trade or commerce among the several States; (8) "State" as the several States, the District of Columbia, the Commonwealth of Puerto Rico and the territories and possessions of the United States; (9) "purchaser" to mean an actual or prospective purchaser or lessee of any lot in a subdivision; and (10) "offer" as any inducement, solicitation, or attempt to encourage a person to acquire a lot in a subdivision.
Section 1403. Exemptions
Subsection (a) provides that, unless the method of disposition is adopted to evade the provisions of the Act, it shall not apply to the: (1) Sale or lease of real estate not pursuant to a common promotional plan to offer or sell 50 or more lots in a subdivision; (2) sale or lease of lots in a subdivision, all of which are 5 acres or more in size; (3) sale or lease of improved land on which there is a residential, commercial, or industrial building or land under a contract requiring that the seller erect such a building on the property within 2 years; (4) sale or lease of real estate pursuant to a court order; (5) sale of evidences of indebtedness secured by a mortgage or deed of trust on real estate; (6) sale of securities issued by a real estate investment trust; (7) sale or lease of real estate by any government or government agency; (8) sale or lease of cemetery lots; (9) sale or lease of lots to any person who acquires them to engage in the business of
constructing residential, commercial, or industrial buildings or for resale or lease to persons engaged in such business and (10) sale or lease of real estate which is free and clear of all liens, encumbrances and adverse claims (not intended to refer to property reservations conveyed or dedicated to local bodies or public utilities for the purpose of bringing public services to the land nor to taxes or assessment which constitute liens on the property before they are due and payable) if each and every purchaser has personally inspected the lot and if the developer executes a written affirmation to this effect in accordance with rules and regulations of the Secretary.
Subsection (b) provides that the Secretary of HUD may make exemptions from any of the provisions of the title if he finds the coverage is not necessary to the public interest and for the protection of purchasers due to the small amount of the offering or its limited character.
Section 1404. Prohibitions relating to the sale or lease of lots in subdivisions
Subsection (a) makes it unlawful for any developer or agent engaged in interstate commerce (1) to sell or lease any lot unless a statement of record is in effect pursuant to section 1407 and a printed property report is furnished to each purchaser in accordance with section 1408; (2) to employ any device, scheme, or artifice to defraud; to obtain money or property by means of material misrepresentation with respect to information in the statement of record or the property report or any other information; or to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit on the purchaser.
Subsection (b) provides that a purchaser may revoke a contract or agreement of purchase if he is not given a copy of the property report before or at the time of his signing the contract. Where the purchaser does not receive the property report 48 hours before signing the contract, he may revoke it within 48 hours, unless the purchaser read the property report, and inspected the lot to be purchased before signing the contract and so stipulates in writing.
Section 1405. Registration of subdivisions
Subsection (a) provides that a subdivision may be registered by filing a statement of record with the Secretary meeting the requirements of the title and the rules and regulations prescribed by the Secretary. Subsection (b) provides for payment to the Secretary by the developer of a registration fee not in excess of $1,000 in accordance with a schedule to be fixed by regulations of the Secretary and permits the Secretary to use such fees to cover the cost of rendering services under the title.
Subsection (c) provides that the filing of a statement of record or an amendment takes place on its receipt accompanied by payment of the fee provided in subsection (b).
Subsection (d) requires that information contained in or filed with a statement of record be available to the public under regulations prescribed by the Secretary.
Section 1406. Information required in statement of record
This section provides that the statement of record shall contain information and be accompanied by documents specified as follows: (1)
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The name and address of each person having a substantial interest in the lots in the subdivision covered by the statement and the extent of the interest; (2) a legal description of the subdivision, a statement of its total area and topography, and a map showing the division proposed and the dimensions of the lots and their relation to existing streets and roads; (3) a statement of the condition of title to the land, including a statement of encumbrances, deed restriction, and covenants; (4) a statement of the general terms and conditions, including the range of selling prices or rents at which the land is to be disposed of; (5) a statement of the present condition of access to the subdivision, the availability of sewage-disposal facilities and other public utilities (including water, electricity, gas, and telephone), the proximity in miles to nearby municipalities, and the nature of any improvements to be installed by the developer together with his estimated schedule for completion; (6) where there is a blanket encumbrance affecting the subdivision or any portion of it, a statement of the consequence to an individual purchaser if there is failure to meet the obligation and the steps taken, if any, to protect the purchaser if there is such a failure; (7) a copy of the articles of incorporation or other organizational documents of the developer or, if the purported holder of legal title is a person other than the developer, copies of these documents for that person; (8) copies of the instrument establishing title in the developer or other person and copies of any instrument creating a lien or encumbrance upon the title, or copies of the opinion or opinions of counsel on the title, or copies of the title insurance policy guaranteeing the title; (9) copies of all forms of conveyance to be used in selling or leasing lots to purchasers; (10) copies of instruments creating easements or other restrictions; (11) such certified or uncertified financial statements of the developer as required by the Secretary; and (12) other information, documents, and certifications as required by the Secretary as being reasonably necessary or appropriate for the protection of purchasers.
Section 1407. Taking effect of statements of record and amendments thereto
Subsection (a) provides that a statement of record, or any amendment, shall take effect on the 30th day after filing or at an earlier date if the Secretary so determines. When additional lands are offered for disposition, a developer may consolidate the statement with any prior statement of record offering subdivided land under the same promotional plan.
Subsection (b) provides that the Secretary advise the developer within a reasonable time if the statement is materially defective. Such notification suspends the effective date until 30 days after a corrective filing is made. The developer may, however, request a hearing which must be held within 20 days of the Secretary's receipt of the request. Subsection (c) requires the developer to file an amendment to a statement if any change occurs subsequent to its effective date which affects any material fact required to be contained in the statement. Subsection (d) permits the Secretary, after notice and opportunity for hearing, to suspend a statement of record if it appears to him that it includes an untrue statement of a material fact or omits to state a material fact required to be stated or necessary to make the statement not misleading. Upon the Secretary's declaration that the defective
statement has been corrected, the suspension order ceases to be effective.
Subsection (e) empowers the Secretary to make an examination to determine whether an order should be issued under subsection (d) and allows him to have access to, and demand production of, any relevant books and papers of the developer, his agent, or any other person when the matter is relevant to the examination.
Subsection (f) permits any notice required under section 1407 to be sent to, or served on, the developer or his authorized agent.
Section 1408. Information required in property report
Subsection (a) provides that a property report shall contain any information in the statement of record that the Secretary deems necessary, as well as any other information prescribed under rules and regulations of the Secretary as necessary or appropriate.
Subsection (b) requires that the property report not be used for any promotional purposes before the statement of record becomes effective, and then only if used in its entirety and states that no person may advertise or represent that the Secretary approves or recommends the subdivision.
Section 1409. Cooperation with State authorities
Subsection (a) provides that the Secretary shall cooperate with State authorities responsible for regulating the sale of lots in subdivisions subject to the title. It also permits the Secretary to accept for filing under, and declare effective as a statement of record, material filed with and found acceptable by such authorities.
Subsection (b) provides that nothing in the title shall affect the jurisdiction of any State real estate commission.
Section 1410. Civil liabilities
Subsection (a) provides that, if any part of the statement of record contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein when it becomes effective, anyone buying a lot while such statement remained uncorrected who did not know of such untruth or omission may sue the developer at law or in equity in any court of competent jurisdiction.
Subsection (b) provides that any developer or agent selling or leasing a lot (1) in violation of section 1404, or (2) by means of a materially defective property report may be sued by the purchaser of the lot.
Subsection (c) provides that damages in such civil actions shall represent the difference between the amount paid for the lot and the reasonable cost of any improvements thereto, and the lesser of (1) the value thereof as of the time such suit was brought, or (2) the price at which such lot shall have been disposed of in a bona fide market transaction before suit, or (3) the price at which such lot shall have been disposed of after suit in a bona fide market transaction but before judgment.
Subsection (d) permits any person liable to make any payment under this section to recover contribution from any other person who, if sued separately, would have been liable for such payment. Subsection (e) limits amounts recoverable under this section to the sum of the purchase price of the lot, the reasonable cost of improvements, and reasonable court costs.