MD
Maryland House Bill HB52

Maryland 2023 Regular Session

Maryland House Bill HB52 Compare Versions

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33 EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
44 [Brackets] indicate matter deleted from existing law.
5- Underlining indicates amendments to bill.
6- Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7-amendment.
85 *hb0052*
96
107 HOUSE BILL 52
118 N1 3lr0993
129 (PRE–FILED)
1310 By: Delegate Foley
1411 Requested: November 20, 2022
1512 Introduced and read first time: January 11, 2023
1613 Assigned to: Economic Matters
17-Committee Report: Favorable with amendments
18-House action: Adopted
19-Read second time: March 11, 2023
2014
21-CHAPTER ______
15+A BILL ENTITLED
2216
2317 AN ACT concerning 1
2418
2519 Condominiums – Sales Contracts – Asbestos Disclosure 2
2620
2721 FOR the purpose of establishing the unenforceability of contracts for the sale of 3
2822 condominium units that do not contain certain notice relating to the presence of 4
2923 asbestos; and generally relating to contracts for the sale of condominium units. 5
3024
3125 BY repealing and reenacting, with amendments, 6
3226 Article – Real Property 7
3327 Section 11–126(a) and 11–135(a)(4)(x) and (xi) and (5) and (g)(1) 8
3428 Annotated Code of Maryland 9
3529 (2015 Replacement Volume and 2022 Supplement) 10
3630
3731 BY adding to 11
3832 Article – Real Property 12
3933 Section 11–135(a)(4)(xii) 13
4034 Annotated Code of Maryland 14
4135 (2015 Replacement Volume and 2022 Supplement) 15
4236
4337 SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MA RYLAND, 16
4438 That the Laws of Maryland read as follows: 17
4539
4640 Article – Real Property 18
4741
48-11–126. 19 2 HOUSE BILL 52
42+11–126. 19
43+
44+ (a) A contract for the initial sale of a unit to a member of the public is not 20
45+enforceable by the vendor unless: 21
46+
47+ (1) The purchaser is given on or before the time a contract is entered into 22
48+between the vendor and the purchaser, a current public offering statement as amended and 23 2 HOUSE BILL 52
49+
50+
51+registered with the Secretary of State containing all of the information set forth in 1
52+subsection (b) of this section; and 2
53+
54+ (2) The contract of sale contains, in conspicuous type, a notice of: 3
55+
56+ (i) The purchaser’s right to receive a public offering statement and 4
57+his rescission rights under this section; [and] 5
58+
59+ (ii) 1. The warranties provided by § 11–131 of this title; and 6
60+
61+ 2. Whether the council of unit owners has entered into any 7
62+agreement that settles or releases the council of unit owners’ claims related to common 8
63+element warranties under § 11–131 of this title; AND 9
64+
65+ (III) A STATEMENT AS TO WHETHER THE VENDOR HAS ACTUAL 10
66+KNOWLEDGE OF THE PRESENCE OF ASBESTOS ON THE SITE , INCLUDING A 11
67+DESCRIPTION OF THE L OCATION OF THE ASBESTOS , WHETHER ABATEMENT HAS 12
68+BEEN PERFORMED , AND THE DATE OF ANY ABATEMENT . 13
69+
70+11–135. 14
71+
72+ (a) Except as provided in subsection (b) of this section, a contract for the resale of 15
73+a unit by a unit owner other than a developer is not enforceable unless the contract of sale 16
74+contains in conspicuous type a notice in the form specified in subsection (g)(1) of this 17
75+section, and the unit owner furnishes to the purchaser not later than 15 days prior to 18
76+closing: 19
77+
78+ (4) A certificate containing: 20
79+
80+ (x) A description of any recreational or other facilities which are to 21
81+be used by the unit owners or maintained by them or the council of unit owners, and a 22
82+statement as to whether or not they are to be a part of the common elements; [and] 23
83+
84+ (xi) 1. A statement as to whether the council of unit owners has 24
85+entered into any agreement that settles or releases the council of unit owners’ claims 25
86+related to common element warranties under § 11–131 of this title; and 26
87+
88+ 2. A statement as to whether the board of directors has 27
89+disclosed to the council of unit owners in accordance with § 11–134.1(c)(2) of this title, the 28
90+board’s intention to enter into an agreement for the purpose of settling a disputed common 29
91+element warranty claim under § 11–131 of this title; AND 30
92+
93+ (XII) A STATEMENT AS TO WHET HER THE COUNCIL OF U NIT 31
94+OWNERS HAS ACTUAL KN OWLEDGE OF THE PRESE NCE OF ASBESTOS ON T HE SITE, 32
95+INCLUDING A DESCRIPTION OF THE LOCATION OF THE ASBE STOS, WHETHER 33
96+ABATEMENT HAS BEEN PERFORMED , AND THE DATE OF ANY ABATEMENT ; 34 HOUSE BILL 52 3
4997
5098
5199
52- (a) A contract for the initial sale of a unit to a member of the public is not 1
53-enforceable by the vendor unless: 2
100+ (5) A statement by the unit owner as to whether the unit owner has 1
101+knowledge: 2
54102
55- (1) The purchaser is given on or before the time a contract is entered into 3
56-between the vendor and the purchaser, a current public offering statement as amended and 4
57-registered with the Secretary of State containing all of the information set forth in 5
58-subsection (b) of this section; and 6
103+ (i) That any alteration to the unit or to the limited common 3
104+elements assigned to the unit violates any provision of the declaration, bylaws, or rules and 4
105+regulations; 5
59106
60- (2) The contract of sale contains, in conspicuous type, a notice of: 7
107+ (ii) Of any violation of the health or building codes with respect to 6
108+the unit or the limited common elements assigned to the unit; [and] 7
61109
62- (i) The purchaser’s right to receive a public offering statement and 8
63-his rescission rights under this section; [and] 9
110+ (iii) That the unit is subject to an extended lease under § 11–137 of 8
111+this title or under local law, and if so, a copy of the lease must be provided; and 9
64112
65- (ii) 1. The warranties provided by § 11–131 of this title; and 10
113+ (IV) OF THE PRESENCE OF AS BESTOS ON THE SITE , INCLUDING 10
114+A DESCRIPTION OF THE LOCATION OF THE ASBE STOS, WHETHER ABATEMENT HAS 11
115+BEEN PERFORMED, AND THE DATE OF ANY ABATEMENT ; AND 12
66116
67- 2. Whether the council of unit owners has entered into any 11
68-agreement that settles or releases the council of unit owners’ claims related to common 12
69-element warranties under § 11–131 of this title; AND 13
117+ (g) (1) A notice given as required by subsection (a) of this section shall be 13
118+sufficient for the purposes of this section if it is in substantially the following form: 14
70119
71- (III) A STATEMENT AS TO WHET HER THE VENDOR HAS A CTUAL 14
72-KNOWLEDGE OF THE PRE SENCE OF ASBESTOS ON THE SITE, INCLUDING A 15
73-DESCRIPTION OF THE L OCATION OF THE ASBES TOS, WHETHER ABATEMENT HA S 16
74-BEEN PERFORMED , AND THE DATE OF ANY ABATEMENT . 17
120+“NOTICE 15
75121
76-11–135. 18
122+ The seller is required by law to furnish to you not later than 15 days prior to closing 16
123+certain information concerning the condominium which is described in § 11–135 of the 17
124+Maryland Condominium Act. This information must include at least the following: 18
77125
78- (a) Except as provided in subsection (b) of this section, a contract for the resale of 19
79-a unit by a unit owner other than a developer is not enforceable unless the contract of sale 20
80-contains in conspicuous type a notice in the form specified in subsection (g)(1) of this 21
81-section, and the unit owner furnishes to the purchaser not later than 15 days prior to 22
82-closing: 23
126+ (i) A copy of the declaration (other than the plats); 19
83127
84- (4) A certificate containing: 24
128+ (ii) A copy of the bylaws; 20
85129
86- (x) A description of any recreational or other facilities which are to 25
87-be used by the unit owners or maintained by them or the council of unit owners, and a 26
88-statement as to whether or not they are to be a part of the common elements; [and] 27
130+ (iii) A copy of the rules and regulations of the condominium; 21
89131
90- (xi) 1. A statement as to whether the council of unit owners has 28
91-entered into any agreement that settles or releases the council of unit owners’ claims 29
92-related to common element warranties under § 11–131 of this title; and 30
132+ (iv) A certificate containing: 22
93133
94- 2. A statement as to whether the board of directors has 31
95-disclosed to the council of unit owners in accordance with § 11–134.1(c)(2) of this title, the 32 HOUSE BILL 52 3
134+ 1. A statement disclosing the effect on the proposed 23
135+conveyance of any right of first refusal or other restraint on the free alienability of the unit, 24
136+other than any restraint created by the unit owner; 25
137+
138+ 2. A statement of the amount of the monthly common 26
139+expense assessment and any unpaid common expense or special assessment currently due 27
140+and payable from the selling unit owner; 28
141+
142+ 3. A statement of any other fees payable by the unit owners 29
143+to the council of unit owners; 30
144+
145+ 4. A statement of any capital expenditures approved by the 31 4 HOUSE BILL 52
96146
97147
98-board’s intention to enter into an agreement for the purpose of settling a disputed common 1
99-element warranty claim under § 11–131 of this title; AND 2
148+council of unit owners or its authorized designee planned at the time of the conveyance 1
149+which are not reflected in the current operating budget included in the certificate; 2
100150
101- (XII) A STATEMENT AS TO WHET HER THE COUNCIL OF U NIT 3
102-OWNERS HAS ACTUAL KN OWLEDGE OF THE PRESE NCE OF ASBESTOS ON T HE SITE, 4
103-INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , WHETHER 5
104-ABATEMENT HAS BEEN P ERFORMED , AND THE DATE OF ANY ABATEMENT ; 6
151+ 5. The most recently prepared balance sheet and income and 3
152+expense statement, if any, of the condominium; 4
105153
106- (5) A statement by the unit owner as to whether the unit owner has 7
107-knowledge: 8
154+ 6. The current operating budget of the condominium, 5
155+including details concerning the amount of the reserve fund for repair and replacement and 6
156+its intended use, or a statement that there is no reserve fund; 7
108157
109- (i) That any alteration to the unit or to the limited common 9
110-elements assigned to the unit violates any provision of the declaration, bylaws, or rules and 10
111-regulations; 11
158+ 7. A statement of any judgments against the condominium 8
159+and the existence of any pending suits to which the council of unit owners is a party; 9
112160
113- (ii) Of any violation of the health or building codes with respect to 12
114-the unit or the limited common elements assigned to the unit; [and] 13
161+ 8. A statement generally describing any insurance policies 10
162+provided for the benefit of the unit owners, a notice that the policies are available for 11
163+inspection stating the location at which they are available, and a notice that the terms of 12
164+the policy prevail over the general description; 13
115165
116- (iii) That the unit is subject to an extended lease under § 11–137 of 14
117-this title or under local law, and if so, a copy of the lease must be provided; and 15
166+ 9. A statement as to whether the council of unit owners has 14
167+knowledge that any alteration or improvement to the unit or to the limited common 15
168+elements assigned to the unit violates any provision of the declaration, bylaws, or rules or 16
169+regulations; 17
118170
119- (IV) OF THE PRESENCE OF AS BESTOS ON THE SITE IN THE UNIT, 16
120-INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , AND WHETHER 17
121-ABATEMENT HAS BEEN P ERFORMED , AND THE DATE OF ANY ABATEMENT IN THE 18
122-UNIT DURING THE OCCUPANCY OF THE OWN ER; AND 19
171+ 10. A statement as to whether the council of unit owners has 18
172+knowledge of any violation of the health or building codes with respect to the unit, the 19
173+limited common elements assigned to the unit, or any other portion of the condominium; 20
123174
124- (g) (1) A notice given as required by subsection (a) of this section shall be 20
125-sufficient for the purposes of this section if it is in substantially the following form: 21
175+ 11. A statement of the remaining term of any leasehold estate 21
176+affecting the condominium and the provisions governing any extension or renewal of it; 22
126177
127-“NOTICE 22
178+ 12. A description of any recreational or other facilities which 23
179+are to be used by the unit owners or maintained by them or the council of unit owners, and 24
180+a statement as to whether or not they are to be a part of the common elements; [and] 25
128181
129- The seller is required by law to furnish to you not later than 15 days prior to closing 23
130-certain information concerning the condominium which is described in § 11–135 of the 24
131-Maryland Condominium Act. This information must include at least the following: 25
182+ 13. A. A statement as to whether the council of unit 26
183+owners has entered into any agreement that settles or releases the council of unit owners’ 27
184+claims related to common element warranties under § 11–131 of this title; and 28
132185
133- (i) A copy of the declaration (other than the plats); 26
186+ B. A statement as to whether the board of directors has 29
187+disclosed to the council of unit owners in accordance with § 11–134.1(c)(2) of this title, the 30
188+board’s intention to enter into an agreement for the purpose of settling a disputed common 31
189+element warranty claim under § 11–131 of this title; and 32
134190
135- (ii) A copy of the bylaws; 27
136-
137- (iii) A copy of the rules and regulations of the condominium; 28
138-
139- (iv) A certificate containing: 29
140-
141- 1. A statement disclosing the effect on the proposed 30
142-conveyance of any right of first refusal or other restraint on the free alienability of the unit, 31
143-other than any restraint created by the unit owner; 32 4 HOUSE BILL 52
191+ 14. A STATEMENT AS TO WHET HER THE COUNCIL OF U NIT 33
192+OWNERS HAS ACTUAL KN OWLEDGE OF THE PRESE NCE OF ASBESTOS ON T HE SITE, 34
193+INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , WHETHER 35
194+ABATEMENT WAS PERFOR MED, AND THE DATE OF ANY ABATEMENT ; AND 36 HOUSE BILL 52 5
144195
145196
146197
147- 2. A statement of the amount of the monthly common 1
148-expense assessment and any unpaid common expense or special assessment currently due 2
149-and payable from the selling unit owner; 3
198+ (v) A statement by the unit owner as to whether the unit owner has 1
199+knowledge: 2
150200
151- 3. A statement of any other fees payable by the unit owners 4
152-to the council of unit owners; 5
201+ 1. That any alteration to the unit or to the limited common 3
202+elements assigned to the unit violates any provision of the declaration, bylaws, or rules and 4
203+regulations. 5
153204
154- 4. A statement of any capital expenditures approved by the 6
155-council of unit owners or its authorized designee planned at the time of the conveyance 7
156-which are not reflected in the current operating budget included in the certificate; 8
205+ 2. Of any violation of the health or building codes with 6
206+respect to the unit or the limited common elements assigned to the unit. 7
157207
158- 5. The most recently prepared balance sheet and income and 9
159-expense statement, if any, of the condominium; 10
208+ 3. That the unit is subject to an extended lease under § 8
209+11–137 of this title or under local law, and if so, a copy of the lease must be provided. 9
160210
161- 6. The current operating budget of the condom inium, 11
162-including details concerning the amount of the reserve fund for repair and replacement and 12
163-its intended use, or a statement that there is no reserve fund; 13
211+ 4. OF THE PRESENCE OF AS BESTOS ON THE SITE , 10
212+INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , WHETHER 11
213+ABATEMENT HAS BEEN PERFORMED , AND THE DATE OF ANY ABATEMENT . 12
164214
165- 7. A statement of any judgments against the condominium 14
166-and the existence of any pending suits to which the council of unit owners is a party; 15
215+ You will have the right to cancel this contract without penalty, at any time within 7 13
216+days following delivery to you of all of this information. However, once the sale is closed, 14
217+your right to cancel the contract is terminated.”. 15
167218
168- 8. A statement generally describing any insurance policies 16
169-provided for the benefit of the unit owners, a notice that the policies are available for 17
170-inspection stating the location at which they are available, and a notice that the terms of 18
171-the policy prevail over the general description; 19
172-
173- 9. A statement as to whether the council of unit owners has 20
174-knowledge that any alteration or improvement to the unit or to the limited common 21
175-elements assigned to the unit violates any provision of the declaration, bylaws, or rules or 22
176-regulations; 23
177-
178- 10. A statement as to whether the council of unit owners has 24
179-knowledge of any violation of the health or building codes with respect to the unit, the 25
180-limited common elements assigned to the unit, or any other portion of the condominium; 26
181-
182- 11. A statement of the remaining term of any leasehold estate 27
183-affecting the condominium and the provisions governing any extension or renewal of it; 28
184-
185- 12. A description of any recreational or other facilities which 29
186-are to be used by the unit owners or maintained by them or the council of unit owners, and 30
187-a statement as to whether or not they are to be a part of the common elements; [and] 31
188-
189- 13. A. A statement as to whether the council of unit 32
190-owners has entered into any agreement that settles or releases the council of unit owners’ 33
191-claims related to common element warranties under § 11–131 of this title; and 34
192- HOUSE BILL 52 5
193-
194-
195- B. A statement as to whether the board of directors has 1
196-disclosed to the council of unit owners in accordance with § 11–134.1(c)(2) of this title, the 2
197-board’s intention to enter into an agreement for the purpose of settling a disputed common 3
198-element warranty claim under § 11–131 of this title; and 4
199-
200- 14. A STATEMENT AS TO WHET HER THE COUNCIL OF U NIT 5
201-OWNERS HAS ACTUAL KN OWLEDGE OF THE PRESE NCE OF ASBESTOS ON T HE SITE, 6
202-INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , WHETHER 7
203-ABATEMENT WAS PERFOR MED, AND THE DATE OF ANY ABATEMENT ; AND 8
204-
205- (v) A statement by the unit owner as to whether the unit owner has 9
206-knowledge: 10
207-
208- 1. That any alteration to the unit or to the limited common 11
209-elements assigned to the unit violates any provision of the declaration, bylaws, or rules and 12
210-regulations. 13
211-
212- 2. Of any violation of the health or building codes with 14
213-respect to the unit or the limited common elements assigned to the unit. 15
214-
215- 3. That the unit is subject to an extended lease under § 16
216-11–137 of this title or under local law, and if so, a copy of the lease must be provided. 17
217-
218- 4. OF THE PRESENCE OF AS BESTOS ON THE SITE IN THE 18
219-UNIT, INCLUDING A DESCRIPT ION OF THE LOCATION OF THE ASBESTOS , AND 19
220-WHETHER ABATEMENT HA S BEEN PERFORMED , AND THE DATE OF ANY ABATEMENT 20
221-IN THE UNIT DURING T HE OCCUPANCY OF TH E OWNER. 21
222-
223- You will have the right to cancel this contract without penalty, at any time within 7 22
224-days following delivery to you of all of this information. However, once the sale is closed, 23
225-your right to cancel the contract is terminated.”. 24
226-
227- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 25
228-October 1, 2023. 26
229-
230-
231-
232-
233-Approved:
234-________________________________________________________________________________
235- Governor.
236-________________________________________________________________________________
237- Speaker of the House of Delegates.
238-________________________________________________________________________________
239- President of the Senate.
219+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 16
220+October 1, 2023. 17