[HISTORY: Adopted by the City Council of the City of Canandaigua
as indicated in article histories. Amendments noted where applicable.]
[Adopted 3-6-2014 by L.L. No. 1-2014]
As used in this chapter, any inconsistent provision of law notwithstanding,
the following terms shall have the following meanings:
Any lien, including liens for taxes, special ad valorem levies,
special assessments and municipal charges arising by operation of
law against property in favor of the City and remaining undischarged
for a period of one year or more.
Property upon which there is erected any residence or commercial
or industrial building or structure, except a one- or two-family residence
structure.
A lien upon fire insurance proceeds pursuant to this chapter
and New York General Municipal Law § 22 and Insurance Law
§§ 331 and 3410.
Pursuant to the provisions of § 22 of the General
Municipal Law and subsequent to the adoption of a resolution by the
City Council providing therefor, the City Clerk/Treasurer shall file
a notice of intention to claim against the proceeds of fire insurance
policies with the State Superintendent of Financial Services. Said
notice shall be entered in the index of liens maintained by the State
Superintendent of Financial Services as provided in § 331
of the Insurance Law. Said notice shall constitute constructive notice
to each insurer of real property of the City's claim against
any proceeds payable under the provisions of any fire insurance policy.
Prior to the payment of any proceeds of a policy of insurance
for damages caused by fire to real property situated within the City
of Canandaigua, each insurer shall notify the City Clerk/Treasurer
that a loss has been sustained and demand that the Treasurer's
certificate indicating the amount of all liens of the City against
said property, including interest and penalties to the date of the
certificate, be served, at a specified address, in person or by certified
mail, upon the insurer, within 20 days from the date of mailing such
demand. Within 10 days of receipt of such certificate of lien and
a final determination of the insurer's obligation to pay such
proceeds, the insurer shall pay therefrom the amounts specified in
the certificate to the City Clerk/Treasurer. Notice of the filing
of the certificate shall be given to the insured by the City Clerk/Treasurer
by certified mail.
The claim filed by the City Clerk/Treasurer shall constitute
a special lien against the proceeds of a fire insurance policy on
real property and shall be prior to all other liens and claims against
said proceeds except the claim of a mortgagee of record named in the
fire insurance policy.
The provisions of this chapter shall not be deemed or construed
to alter or impair the right of the City to acquire or enforce any
lien against real property, but shall be in addition to any other
power provided by law to acquire or enforce such right.
A.Â
All or part of the proceeds of a policy of fire insurance paid or
to be paid to the City of Canandaigua, as set forth hereinabove, may
be paid or released to the insured by the City, if the insured satisfies
the City that repairs or restoration of the affected premises are
in the public interest and have been or will be made by the insured.
To secure such payment or release of proceeds, the insured must notify
the City Clerk/Treasurer that he intends to restore or repair the
affected premises to the same or improved condition it was in prior
to the time the lien against the property arose. Such notification
must be filed with the City Clerk/Treasurer within 45 days of the
mailing by the City to the insured of the notice of the filing of
the special lien.
B.Â
The release or return of the fire insurance proceeds by the City
to the insured shall be subject to the following conditions:
(1)Â
The insured shall file an affidavit with the City Clerk/Treasurer,
with such supporting documentation as the Clerk/Treasurer shall require,
containing a complete description of the nature and extent of the
damage to the insured premises and of the condition of the premises
prior to the lien held by the City against the property; a complete
description of the nature of the repairs or restoration to be undertaken
and the cost thereof; a statement as to the source of funds needed
to complete such repairs or restoration, if the insurance proceeds
are not sufficient therefor; the name and address of each contractor
who will effect such repair or restoration; an estimated time schedule
showing how long the repairs or restoration will take; and such other
information as may be required by the City Clerk/Treasurer to enable
her to determine whether the repairs or restoration are in the public
interest and will be or have been timely and properly made.
(2)Â
Upon preliminary approval by the Clerk/Treasurer of the application, as set forth in Subsection B(1) of this section, the Clerk/Treasurer shall notify the applicant, in writing, evidencing the right of release to the insured of part or all of the insurance proceeds. The repairs or restoration required by the Clerk/Treasurer shall be completed in compliance with the terms and conditions set forth in said notification prior to the release or return of any part of the insurance proceeds unless the Clerk/Treasurer, upon the written request of the insured and in the discretion of the Clerk/Treasurer, approves a prior release of such proceeds or a portion thereof. The Clerk/Treasurer may not approve such prior release unless the insured certifies and demonstrates that such release is necessary to permit the repairs or restoration to go forward. The Clerk/Treasurer shall require guarantee from the insured of performance of such obligation, including, but not limited to, an agreement to deposit such proceeds in an escrow account or that the insured shall obtain a performance bond. The Clerk/Treasurer may release said proceeds or any portion thereof directly to the contractor or contractors.
(3)Â
The release or return of the fire insurance proceeds or any part
thereof shall be subject to the repair or restoration of the affected
premises, in accordance with applicable building and zoning codes,
to the condition it was in prior to the time the lien of the City
against the property arose or to an improved condition.
(4)Â
If the insured fails to notify the City Clerk/Treasurer of his intention to repair or restore the affected premises as set forth in Subsection B(1) hereof, or fails to file a completed application, or fails to supply the Clerk/Treasurer with specified documentation as required or fails to obtain the approval of the Clerk/Treasurer for the repairs or restoration within the time set forth, the right of the insured to assert a claim against the insurance proceeds, except to the extent said proceeds exceed the amount of the City's special lien, shall terminate.
Any insurance proceeds received by the City of Canandaigua pursuant
to this chapter shall be deposited in a special fund and retained
therein until such time as the insured's right to claim against
the proceeds has terminated. The proceeds shall then be applied to
the liens held by the City against the real property affected and
may be transferred to the general fund. The lien or liens against
the real property affected shall continue in full force and effect,
except to the extent that such lien or liens are or have been paid.
