IN
Indiana House Bill HB1222

Indiana 2024 Regular Session

Indiana House Bill HB1222 Compare Versions

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1+*EH1222.1*
2+February 23, 2024
3+ENGROSSED
4+HOUSE BILL No. 1222
5+_____
6+DIGEST OF HB 1222 (Updated February 21, 2024 4:40 pm - DI 149)
7+Citations Affected: IC 32-28; IC 34-30.
8+Synopsis: Residential real estate service agreements. Defines a
9+"residential real estate service agreement" as an agreement: (1) under
10+which a service provider agrees to provide one or more services: (A)
11+in connection with the maintenance, purchase, or sale of residential real
12+estate; and (B) that are not to be performed in their entirety within one
13+year after the agreement is entered into; and (2) that: (A) purports to
14+run with the land or to be binding on future owners; (B) allows for the
15+assignment of the right to provide one or more of the services under the
16+agreement without the consent of the owner of the residential real
17+estate; or (C) purports to create a lien or an encumbrance on, or a
18+security interest in, the residential real estate. Provides that a residential
19+real estate service agreement that is entered into after March 14, 2024,
20+is void and unenforceable. Prohibits a person from recording after
21+March 14, 2024, a residential real estate service agreement in Indiana,
22+regardless of when the residential real estate service agreement is
23+entered into. Provides that a county recorder, or an employee of a
24+county recorder, who records a residential real estate service agreement
25+(Continued next page)
26+Effective: Upon passage.
27+Haggard, Torr
28+(SENATE SPONSORS — ALEXANDER, GOODE, KOCH)
29+January 9, 2024, read first time and referred to Committee on Judiciary.
30+January 29, 2024, amended, reported — Do Pass.
31+January 31, 2024, read second time, ordered engrossed. Engrossed.
32+February 1, 2024, read third time, passed. Yeas 94, nays 0.
33+SENATE ACTION
34+February 12, 2024, read first time and referred to Committee on Judiciary.
35+February 22, 2024, reported favorably — Do Pass.
36+EH 1222—LS 6891/DI 101 Digest Continued
37+that is presented to the county recorder's office for recording is not
38+civilly liable under the bill's provisions, regardless of when the
39+recording occurs. Provides that if a residential real estate service
40+agreement (agreement) is recorded in Indiana after March 14, 2024,
41+any person with an interest in the residential real estate that is the
42+subject of the agreement may: (1) apply to a court in the county in
43+which the agreement is recorded for a declaratory judgment declaring
44+the agreement unenforceable; and (2) recover the person's actual
45+damages against any service provider that: (A) is a party to the
46+agreement; and (B) recorded, or caused to be recorded, the agreement.
47+Provides that a service provider that: (1) enters into a residential real
48+estate service agreement with any person; or (2) records, or causes to
49+be recorded, a residential real estate service agreement in Indiana; after
50+March 14, 2024, commits a deceptive act that is subject to the remedies
51+and penalties under the deceptive consumer sales act (act), including
52+an action by the attorney general under the act. Provides that the bill's
53+provisions do not apply to: (1) a residential real estate service
54+agreement entered into before March 15, 2024 (except as otherwise
55+provided in the bill); or (2) certain specified products, contracts, rights,
56+agreements, services, or liens.
57+EH 1222—LS 6891/DI 101EH 1222—LS 6891/DI 101 February 23, 2024
158 Second Regular Session of the 123rd General Assembly (2024)
259 PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
360 Constitution) is being amended, the text of the existing provision will appear in this style type,
461 additions will appear in this style type, and deletions will appear in this style type.
562 Additions: Whenever a new statutory provision is being enacted (or a new constitutional
663 provision adopted), the text of the new provision will appear in this style type. Also, the
764 word NEW will appear in that style type in the introductory clause of each SECTION that adds
865 a new provision to the Indiana Code or the Indiana Constitution.
966 Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
1067 between statutes enacted by the 2023 Regular Session of the General Assembly.
11-HOUSE ENROLLED ACT No. 1222
12-AN ACT to amend the Indiana Code concerning property.
68+ENGROSSED
69+HOUSE BILL No. 1222
70+A BILL FOR AN ACT to amend the Indiana Code concerning
71+property.
1372 Be it enacted by the General Assembly of the State of Indiana:
14-SECTION 1. IC 32-28-15 IS ADDED TO THE INDIANA CODE
15-AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
16-UPON PASSAGE]:
17-Chapter 15. Prohibition Against Residential Real Estate Service
18-Agreements
19-Sec. 1. (a) Except as otherwise provided in this chapter, this
20-chapter does not apply to a residential real estate service
21-agreement entered into before March 15, 2024.
22-(b) This chapter does not apply to any of the following:
23-(1) A home warranty or similar product that covers the cost
24-of maintenance of a major home system, such as:
25-(A) a plumbing system;
26-(B) a heating, cooling, and ventilation system; or
27-(C) electrical wiring;
28-for a fixed period.
29-(2) An insurance contract.
30-(3) An option to purchase residential real estate or a right of
31-refusal to purchase residential real estate.
32-(4) A declaration that is created in the formation of:
33-(A) an association of co-owners (as defined in IC 32-25-2-2)
34-for a condominium (as defined in IC 32-25-2-7); or
35-HEA 1222 2
36-(B) a homeowners association (as defined in
37-IC 32-25.5-2-4);
38-including any amendment to the declaration.
39-(5) A maintenance or repair agreement entered into by:
40-(A) an association of co-owners (as defined in IC 32-25-2-2)
41-for a condominium (as defined in IC 32-25-2-7); or
42-(B) a homeowners association (as defined in
43-IC 32-25.5-2-4).
44-(6) A mortgage loan or a commitment to make or receive a
45-mortgage loan.
46-(7) A security agreement under IC 26-1 concerning the sale or
47-rental of personal property or fixtures.
48-(8) Providers of:
49-(A) utility services, including water, sewer, gas, or electric
50-service; or
51-(B) communications service (as defined in IC 8-1-32.5-3).
52-(9) A land contract (as defined in IC 24-9-2-9.5).
53-(10) An attorney's lien authorized by IC 33-43-4.
54-(11) A statutory lien authorized by this article, including:
55-(A) the lien of a broker company (as defined in
56-IC 32-28-12.5-0.5) upon commercial real estate under
57-IC 32-28-12.5-5; or
58-(B) a mechanic's or materialman's lien under IC 32-28-3.
59-Sec. 2. As used in this chapter, "person" means:
60-(1) a natural person; or
61-(2) an organization, including a corporation, a partnership, a
62-proprietorship, an association, a cooperative, an estate, a
63-trust, or another legal entity.
64-Sec. 3. As used in this chapter, "record" means to record a
65-record (as defined in IC 32-17.5-3-3(a)) with a county recorder in
66-accordance with Indiana law.
67-Sec. 4. As used in this chapter, "residential real estate" means
68-real property:
69-(1) that is located in Indiana; and
70-(2) upon which is constructed or intended to be constructed a
71-dwelling that contains one (1) to four (4) units.
72-Sec. 5. (a) As used in this chapter, "residential real estate service
73-agreement" means an agreement:
74-(1) under which a service provider agrees to provide one (1)
75-or more services:
76-(A) in connection with the maintenance, purchase, or sale
77-of residential real estate; and
78-HEA 1222 3
79-(B) that are not to be performed in their entirety within
80-one (1) year after the agreement is entered into; and
81-(2) that has one (1) or more of the following characteristics:
82-(A) The agreement purports to run with the land or to be
83-binding on future owners of interests in the residential real
84-estate.
85-(B) The agreement allows for the assignment of the right
86-to provide one (1) or more of the services under the
87-agreement without the consent of the owner of the
88-residential real estate to the assignment.
89-(C) The agreement purports to create:
90-(i) a lien or an encumbrance on; or
91-(ii) a security interest in;
92-the residential real estate.
93-(b) For purposes of sections 8 and 9 of this chapter, the term
94-includes a:
95-(1) notice; or
96-(2) memorandum;
97-of an agreement described in subsection (a).
98-Sec. 6. As used in this chapter, "service provider" means a
99-person that provides services or products to a consumer.
100-Sec. 7. A residential real estate service agreement that is entered
101-into after March 14, 2024, is void and unenforceable.
102-Sec. 8. (a) After March 14, 2024, a person shall not record, or
103-cause to be recorded, a residential real estate service agreement in
104-Indiana, regardless of when the residential real estate service
105-agreement was entered into.
106-(b) A county recorder, or an employee of a county recorder,
107-who records a residential real estate service agreement that is
108-presented to the county recorder's office for recording is not liable
109-to:
110-(1) any party to the residential real estate service agreement;
111-or
112-(2) any other person;
113-regardless of when the recording occurs.
114-(c) If a residential real estate service agreement is recorded in
115-Indiana after March 14, 2024, the recording does not:
116-(1) create or serve as:
117-(A) a lien or an encumbrance on; or
118-(B) a security interest in;
119-the residential real estate that is the subject of the residential
120-real estate service agreement; or
121-HEA 1222 4
122-(2) constitute actual or constructive notice to:
123-(A) an otherwise bona fide purchaser of the residential real
124-estate that is the subject of the residential real estate
125-service agreement; or
126-(B) any lender that makes a loan to any person in
127-connection with the residential real estate that is the
128-subject of the residential real estate service agreement;
129-of a lien or an encumbrance on, or a security interest in, the
130-residential real estate that is the subject of the residential real
131-estate service agreement.
132-Sec. 9. (a) If a residential real estate service agreement is
133-recorded in Indiana after March 14, 2024, any person with an
134-interest in the residential real estate that is the subject of the
135-residential real estate service agreement may:
136-(1) in accordance with IC 34-14-1, apply to a court of
137-competent jurisdiction in the county in which the residential
138-real estate service agreement is recorded for a judgment
139-declaring the residential real estate service agreement
140-unenforceable; and
141-(2) recover the person's actual damages, as the court
142-determines to have been proven, against any service provider
143-that:
144-(A) is a party to the residential real estate service
145-agreement; and
146-(B) recorded, or caused to be recorded, the residential real
147-estate service agreement;
148-regardless of when the residential real estate service agreement
149-was entered into.
150-(b) If a person with an interest in the residential real estate that
151-is the subject of a residential real estate service agreement obtains
152-under subsection (a) a court order declaring the residential real
153-estate service agreement to be unenforceable, the person shall
154-record the court's order with the county recorder, who shall
155-cross-reference the order to the residential real estate service
156-agreement originally recorded.
157-Sec. 10. A service provider that:
158-(1) enters into a residential real estate service agreement with
159-any person; or
160-(2) records, or causes to be recorded, a residential real estate
161-service agreement in Indiana;
162-after March 14, 2024, commits a deceptive act that is subject to the
163-remedies and penalties under IC 24-5-0.5, including an action by
164-HEA 1222 5
165-the attorney general under IC 24-5-0.5-4(c).
166-SECTION 2. IC 34-30-2.1-527.5 IS ADDED TO THE INDIANA
167-CODE AS A NEW SECTION TO READ AS FOLLOWS
168-[EFFECTIVE UPON PASSAGE]: Sec. 527.5. IC 32-28-15-8(b)
169-(Concerning a county recorder, or an employee of a county
170-recorder, who records a residential real estate service agreement
171-that is presented for recording).
172-SECTION 3. An emergency is declared for this act.
173-HEA 1222 Speaker of the House of Representatives
174-President of the Senate
175-President Pro Tempore
176-Governor of the State of Indiana
177-Date: Time:
178-HEA 1222
73+1 SECTION 1. IC 32-28-15 IS ADDED TO THE INDIANA CODE
74+2 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
75+3 UPON PASSAGE]:
76+4 Chapter 15. Prohibition Against Residential Real Estate Service
77+5 Agreements
78+6 Sec. 1. (a) Except as otherwise provided in this chapter, this
79+7 chapter does not apply to a residential real estate service
80+8 agreement entered into before March 15, 2024.
81+9 (b) This chapter does not apply to any of the following:
82+10 (1) A home warranty or similar product that covers the cost
83+11 of maintenance of a major home system, such as:
84+12 (A) a plumbing system;
85+13 (B) a heating, cooling, and ventilation system; or
86+14 (C) electrical wiring;
87+15 for a fixed period.
88+EH 1222—LS 6891/DI 101 2
89+1 (2) An insurance contract.
90+2 (3) An option to purchase residential real estate or a right of
91+3 refusal to purchase residential real estate.
92+4 (4) A declaration that is created in the formation of:
93+5 (A) an association of co-owners (as defined in IC 32-25-2-2)
94+6 for a condominium (as defined in IC 32-25-2-7); or
95+7 (B) a homeowners association (as defined in
96+8 IC 32-25.5-2-4);
97+9 including any amendment to the declaration.
98+10 (5) A maintenance or repair agreement entered into by:
99+11 (A) an association of co-owners (as defined in IC 32-25-2-2)
100+12 for a condominium (as defined in IC 32-25-2-7); or
101+13 (B) a homeowners association (as defined in
102+14 IC 32-25.5-2-4).
103+15 (6) A mortgage loan or a commitment to make or receive a
104+16 mortgage loan.
105+17 (7) A security agreement under IC 26-1 concerning the sale or
106+18 rental of personal property or fixtures.
107+19 (8) Providers of:
108+20 (A) utility services, including water, sewer, gas, or electric
109+21 service; or
110+22 (B) communications service (as defined in IC 8-1-32.5-3).
111+23 (9) A land contract (as defined in IC 24-9-2-9.5).
112+24 (10) An attorney's lien authorized by IC 33-43-4.
113+25 (11) A statutory lien authorized by this article, including:
114+26 (A) the lien of a broker company (as defined in
115+27 IC 32-28-12.5-0.5) upon commercial real estate under
116+28 IC 32-28-12.5-5; or
117+29 (B) a mechanic's or materialman's lien under IC 32-28-3.
118+30 Sec. 2. As used in this chapter, "person" means:
119+31 (1) a natural person; or
120+32 (2) an organization, including a corporation, a partnership, a
121+33 proprietorship, an association, a cooperative, an estate, a
122+34 trust, or another legal entity.
123+35 Sec. 3. As used in this chapter, "record" means to record a
124+36 record (as defined in IC 32-17.5-3-3(a)) with a county recorder in
125+37 accordance with Indiana law.
126+38 Sec. 4. As used in this chapter, "residential real estate" means
127+39 real property:
128+40 (1) that is located in Indiana; and
129+41 (2) upon which is constructed or intended to be constructed a
130+42 dwelling that contains one (1) to four (4) units.
131+EH 1222—LS 6891/DI 101 3
132+1 Sec. 5. (a) As used in this chapter, "residential real estate service
133+2 agreement" means an agreement:
134+3 (1) under which a service provider agrees to provide one (1)
135+4 or more services:
136+5 (A) in connection with the maintenance, purchase, or sale
137+6 of residential real estate; and
138+7 (B) that are not to be performed in their entirety within
139+8 one (1) year after the agreement is entered into; and
140+9 (2) that has one (1) or more of the following characteristics:
141+10 (A) The agreement purports to run with the land or to be
142+11 binding on future owners of interests in the residential real
143+12 estate.
144+13 (B) The agreement allows for the assignment of the right
145+14 to provide one (1) or more of the services under the
146+15 agreement without the consent of the owner of the
147+16 residential real estate to the assignment.
148+17 (C) The agreement purports to create:
149+18 (i) a lien or an encumbrance on; or
150+19 (ii) a security interest in;
151+20 the residential real estate.
152+21 (b) For purposes of sections 8 and 9 of this chapter, the term
153+22 includes a:
154+23 (1) notice; or
155+24 (2) memorandum;
156+25 of an agreement described in subsection (a).
157+26 Sec. 6. As used in this chapter, "service provider" means a
158+27 person that provides services or products to a consumer.
159+28 Sec. 7. A residential real estate service agreement that is entered
160+29 into after March 14, 2024, is void and unenforceable.
161+30 Sec. 8. (a) After March 14, 2024, a person shall not record, or
162+31 cause to be recorded, a residential real estate service agreement in
163+32 Indiana, regardless of when the residential real estate service
164+33 agreement was entered into.
165+34 (b) A county recorder, or an employee of a county recorder,
166+35 who records a residential real estate service agreement that is
167+36 presented to the county recorder's office for recording is not liable
168+37 to:
169+38 (1) any party to the residential real estate service agreement;
170+39 or
171+40 (2) any other person;
172+41 regardless of when the recording occurs.
173+42 (c) If a residential real estate service agreement is recorded in
174+EH 1222—LS 6891/DI 101 4
175+1 Indiana after March 14, 2024, the recording does not:
176+2 (1) create or serve as:
177+3 (A) a lien or an encumbrance on; or
178+4 (B) a security interest in;
179+5 the residential real estate that is the subject of the residential
180+6 real estate service agreement; or
181+7 (2) constitute actual or constructive notice to:
182+8 (A) an otherwise bona fide purchaser of the residential real
183+9 estate that is the subject of the residential real estate
184+10 service agreement; or
185+11 (B) any lender that makes a loan to any person in
186+12 connection with the residential real estate that is the
187+13 subject of the residential real estate service agreement;
188+14 of a lien or an encumbrance on, or a security interest in, the
189+15 residential real estate that is the subject of the residential real
190+16 estate service agreement.
191+17 Sec. 9. (a) If a residential real estate service agreement is
192+18 recorded in Indiana after March 14, 2024, any person with an
193+19 interest in the residential real estate that is the subject of the
194+20 residential real estate service agreement may:
195+21 (1) in accordance with IC 34-14-1, apply to a court of
196+22 competent jurisdiction in the county in which the residential
197+23 real estate service agreement is recorded for a judgment
198+24 declaring the residential real estate service agreement
199+25 unenforceable; and
200+26 (2) recover the person's actual damages, as the court
201+27 determines to have been proven, against any service provider
202+28 that:
203+29 (A) is a party to the residential real estate service
204+30 agreement; and
205+31 (B) recorded, or caused to be recorded, the residential real
206+32 estate service agreement;
207+33 regardless of when the residential real estate service agreement
208+34 was entered into.
209+35 (b) If a person with an interest in the residential real estate that
210+36 is the subject of a residential real estate service agreement obtains
211+37 under subsection (a) a court order declaring the residential real
212+38 estate service agreement to be unenforceable, the person shall
213+39 record the court's order with the county recorder, who shall
214+40 cross-reference the order to the residential real estate service
215+41 agreement originally recorded.
216+42 Sec. 10. A service provider that:
217+EH 1222—LS 6891/DI 101 5
218+1 (1) enters into a residential real estate service agreement with
219+2 any person; or
220+3 (2) records, or causes to be recorded, a residential real estate
221+4 service agreement in Indiana;
222+5 after March 14, 2024, commits a deceptive act that is subject to the
223+6 remedies and penalties under IC 24-5-0.5, including an action by
224+7 the attorney general under IC 24-5-0.5-4(c).
225+8 SECTION 2. IC 34-30-2.1-527.5 IS ADDED TO THE INDIANA
226+9 CODE AS A NEW SECTION TO READ AS FOLLOWS
227+10 [EFFECTIVE UPON PASSAGE]: Sec. 527.5. IC 32-28-15-8(b)
228+11 (Concerning a county recorder, or an employee of a county
229+12 recorder, who records a residential real estate service agreement
230+13 that is presented for recording).
231+14 SECTION 3. An emergency is declared for this act.
232+EH 1222—LS 6891/DI 101 6
233+COMMITTEE REPORT
234+Mr. Speaker: Your Committee on Judiciary, to which was referred
235+House Bill 1222, has had the same under consideration and begs leave
236+to report the same back to the House with the recommendation that said
237+bill be amended as follows:
238+Page 3, delete lines 34 through 37.
239+Page 3, line 38, delete "(c)" and insert "(b)".
240+Page 4, delete lines 3 through 7.
241+Page 4, line 8, delete "(e)" and insert "(c)".
242+Page 5, line 18, delete "IC 32-28-15-8(c)" and insert
243+"IC 32-28-15-8(b)".
244+Page 5, delete lines 22 through 26.
245+Renumber all SECTIONS consecutively.
246+and when so amended that said bill do pass.
247+(Reference is to HB 1222 as introduced.)
248+JETER
249+Committee Vote: yeas 10, nays 0.
250+_____
251+COMMITTEE REPORT
252+Madam President: The Senate Committee on Judiciary, to which
253+was referred House Bill No. 1222, has had the same under
254+consideration and begs leave to report the same back to the Senate with
255+the recommendation that said bill DO PASS.
256+ (Reference is to HB 1222 as printed January 29, 2024.)
257+
258+BROWN L, Chairperson
259+Committee Vote: Yeas 9, Nays 0
260+EH 1222—LS 6891/DI 101