EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0182*
HOUSE BILL 182
N1, L3 3lr1166
CF 3lr1167
By: Delegates Reznik and Lopez
Introduced and read first time: January 18, 2023
Assigned to: Environment and Transportation
A BILL ENTITLED
AN ACT concerning 1
Real Property – Unlawfully Restrictive Covenants – Modification by 2
Municipalities 3
FOR the purpose of authorizing a municipality to execute and record a restrictive covenant 4
modification to an unlawfully restrictive covenant for a property within the 5
boundaries of the municipality subject to a certain notice requirement; providing 6
that persons with an ownership interest in property that is subject to an unlawfully 7
restrictive covenant may decline action by a municipality to execute and record a 8
restrictive covenant modification; and generally relating to unlawfully restrictive 9
covenants. 10
BY repealing and reenacting, with amendments, 11
Article – Real Property 12
Section 3–112 13
Annotated Code of Maryland 14
(2015 Replacement Volume and 2022 Supplement) 15
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
That the Laws of Maryland read as follows: 17
Article – Real Property 18
3–112. 19
(a) In this section, “unlawfully restrictive covenant” means any recorded covenant 20
or restriction that restricts ownership based on race, religious belief, or national origin. 21
(b) This section does not apply to an unlawfully restrictive covenant that is part 22
of a declaration, uniform general scheme, or plan of development of a homeowners 23
association, as defined in § 11B–101 of this article. 24
2 HOUSE BILL 182
(c) (1) A person may execute and record a restrictive covenant modification to 1
an unlawfully restrictive covenant in accordance with this section if the person: 2
[(1)] (I) Holds an ownership interest in property that the person believes 3
is subject to the unlawfully restrictive covenant; or 4
[(2)] (II) Is a nonprofit entity that is required to enforce within a defined 5
residential neighborhood: 6
[(i)] 1. Covenants that limit architectural alterations, 7
renovations, landscaping elements, or other modifications to residential lots in the 8
neighborhood; and 9
[(ii)] 2. The unlawfully restrictive covenant. 10
(2) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARAGRAPH , A 11
MUNICIPALITY MAY EXECUTE AND RECO RD A RESTRICTIVE COV ENANT 12
MODIFICATION TO AN U NLAWFULLY RESTRICTIV E COVENANT IN ACCORD ANCE WITH 13
THIS SECTION IF: 14
1. THE PROPERTY THAT THE MUNICIPALIT Y BELIEVES 15
IS SUBJECT TO AN UNLAWFULLY RESTRICTI VE COVENANT IS WITHIN THE 16
BOUNDARIES OF THE MU NICIPALITY; AND 17
2. AT LEAST 30 DAYS BEFORE EXECUTING AND 18
RECORDING THE RESTRICTIVE COVE NANT MODIFICATION , THE MUNICIPALITY 19
PROVIDES WRITTEN NOTICE IN ACCORDANCE WITH S UBPARAGRAPH (III) OF THIS 20
PARAGRAPH OF THE MUNICIPALITY’S INTENT TO EXECUTE AN D RECORD THE 21
RESTRICTIVE COVENANT MODIFICATION TO ALL PERSONS WITH AN OWNE RSHIP 22
INTEREST IN THE PROP ERTY. 23
(II) A PERSON WITH AN OWNER SHIP INTEREST IN THE 24
PROPERTY MAY DECLINE TO HAVE THE RESTRICT IVE COVENANT MODIFIC ATION 25
EXECUTED AND RECORDE D BY THE MUNICIPALIT Y BY NOTIFYING THE 26
MUNICIPALITY WITHIN 30 DAYS AFTER THE DATE OF NO TICE. 27
(III) NOTICE UNDER SUBPARAGRAPH (I)2 OF THIS PARAGRAPH 28
SHALL: 29
1. BE SENT BY FIRST–CLASS MAIL; AND 30
2. PROVIDE INFORMATION O N HOW A PERSON WITH AN 31
OWNERSHIP INTEREST I N THE PROPERTY MAY D ECLINE TO HAVE THE RESTRICT IVE 32
COVENANT MODIFICATIO N EXECUTED AND RECOR DED BY THE MUNICIPAL ITY. 33 HOUSE BILL 182 3
(d) (1) A restrictive covenant modification shall: 1
(i) Consist of a complete copy of the original instrument containing 2
the unlawfully restrictive covenant with the language of the unlawfully restrictive covenant 3
stricken; and 4
(ii) Be accompanied by a complete restrictive covenant modification 5
intake sheet, on the form that the Administrative Office of the Courts provides. 6
(2) The restrictive covenant modification intake sheet described in 7
paragraph (1)(ii) of this subsection shall: 8
(i) 1. Be signed by the record owner of the property; or 9
2. In the case of a nonprofit entity, be accompanied by a 10
statement that a majority of the governing body of the nonprofit entity has agreed to the 11
restrictive covenant modification; 12
(ii) Reference the book and page number or other place where the 13
original instrument containing the unlawfully restrictive covenant is recorded; and 14
(iii) Include any other information that the Administrative Office of 15
the Courts considers necessary in carrying out the requirements of this section. 16
(e) (1) On receipt of a restrictive covenant modification, the clerk of the circuit 17
court shall submit the restrictive covenant modification together with a copy of the original 18
instrument referenced in the restrictive covenant modification to the county attorney. 19
(2) The county attorney shall: 20
(i) Review the restrictive covenant modification and the copy of the 21
original instrument to determine: 22
1. Whether the original instrument contains an unlawfully 23
restrictive covenant; and 24
2. Whether the restrictive covenant modification correctly 25
strikes through only the language of the unlawfully restrictive covenant; and 26
(ii) On completion of the review, return the restrictive covenant 27
modification and copy of the original to the clerk of the circuit court together with the 28
county attorney’s determination. 29
(3) The clerk of the circuit court may not record a restrictive covenant 30
modification unless the county attorney determines that the modification is appropriate in 31
accordance with paragraph (2) of this subsection. 32 4 HOUSE BILL 182
(f) A restrictive covenant modification shall be indexed in the same manner as 1
the original instrument. 2
(g) (1) Subject to all covenants, conditions, and restrictions that were recorded 3
after the recording of the original instrument, the restrictions contained in the restrictive 4
covenant modification, once recorded, are the only restrictions based on the original 5
instrument that apply to the property. 6
(2) The effective date of the terms and conditions contained in the 7
restrictive covenant modification shall be the same as the effective date of the original 8
instrument. 9
(h) If a person causes to be recorded a restrictive covenant modification that 10
contains modifications not authorized under this section: 11
(1) The clerk of the circuit court may not incur any liability for recording 12
the restrictive covenant modification; 13
(2) The county may not incur any liability as a result of a determination 14
rendered by the county attorney under subsection (e) of this section; and 15
(3) Any liability that results from the unauthorized recordation shall be 16
the sole responsibility of the person that executed the restrictive covenant modification. 17
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 18
October 1, 2023. 19