[HISTORY: Adopted by the Township Committee
of the Township of Stillwater 5-17-2016 by Ord. No. 2016-8.[1] Amendments noted where applicable.]
[1]
Editor's Note: This ordinance also superseded former Ch. 190,
Fire Insurance Claims, adopted 11-6-1980 by Ord. No. 80-19 (Ch. XVIII
of the 1971 Revised General Ordinances). Said former Ch. 190 was formally
repealed 7-19-2016 by Ord. No. 2016-11.
It is the purpose of this chapter to implement the provisions
of N.J.S.A. 17:36-8 to 17:36-13 to provide a means whereby municipal
liens are a first claim and paramount to all other claims on fire
insurance proceeds payable with respect to fire-damaged real property
located in the Township of Stillwater.
The Township of Stillwater does hereby prohibit the payment
to a claimant, by any insurance company, of any claim in excess of
$2,500 for fire damage on any real property located within the Township
pursuant to any fire insurance policy issued or renewed after the
adoption of this chapter, except as provided for hereunder.
A.
Prior to the payment of fire insurance claim in excess of $2,500,
the insurance company shall request from the Township an official
certificate of search to be executed by the appropriate bonded municipal
official responsible for preparing such certificates, to determine
whether or not all taxes, assessments or other municipal liens are
presently due and payable to the Township. In the event that there
are outstanding sums due and payable to the Township, all sums so
payable shall be paid by the insurance company prior to the payment
of any fire damages to the owner in excess of $2,500.
B.
In addition to the foregoing, a search shall also be required on
an official certificate on a form prescribed and certified by the
Township that demolition of the fire-damaged property is not required
or that the cost of demolition has been paid. If the demolition has
not yet occurred on the date of the receipt by the Township of a request
for execution of the certificate required by this section, the insured
shall provide on that certificate an estimate of the anticipated costs
of demolition. The insurer, on notice to the insured, shall pay the
anticipated cost of demolition to the Township, which shall hold the
funds in an interest-bearing account in a state or federally chartered
bank, savings bank or savings and loan association in this state.
C.
Any request, pursuant to this section, for an official certificate
of search for municipal liens shall specify that the search concerns
fire-damaged property.
A.
The Township Committee may enter into an agreement with the owner
of any fire-damaged property to pay in full all delinquent taxes,
assessments or other liens by installments, pursuant to N.J.S.A. 54:5-19
or for the redemption of a tax sale lien by installment payments,
pursuant to Article 7 of Chapter 5, Title 54 of the Revised Statutes;
provided, however, that the Township Committee must first be satisfied
that the claim for fire damages shall be used to restore or improve
the fire-damaged property. In the event of such an agreement, a certified
copy of the resolution of agreement shall be forwarded to the insurance
company and shall act as its authorization to make full payment on
the claim to the insured person.
B.
The Township may also adopt a resolution to allow the property owner
to make arrangements to pay for the cost of demolition in installments,
by contract or otherwise, in order to obtain a release of the Township's
lien.
The Township claim made in accordance with the provisions of
this chapter shall be paramount to any other claims on the proceeds
of the fire insurance policy, except the claim of the holder of a
purchase money mortgage held as a first mortgage or an institutional
lender which is a holder of a mortgage on the fire damaged property,
where the fire insurance policy at the time of the loss listed the
mortgagee as the holder of an insurable interest, in which event the
claim of the mortgagee to the proceeds shall be paramount to the municipal
lien under this chapter only to the extent of the amount due and payable
to the mortgagee under the mortgage contract. As used in this section,
"institutional lender" means any state or federally chartered bank,
savings bank, savings and loan association, or insurance company.
Nothing in this chapter shall be construed:
A.
To obligate an insurance company for any amount in excess of the
proceeds payable under its fire insurance policy; or
B.
Except as provided in the case of appeals under N.J.S.A. 17:36-10
of this chapter, to obligate the insurance company for any liens not
appearing on the official certificate of any certified changes submitted
by the bonded official; or
C.
To affect the authority of the Township to enforce a municipal lien
under any other law of this state.
D.
To obligate an insurance company for the payment of demolition costs
or anticipated costs, as the case may be, if those costs did not appear
on an official certificate or a certified change submitted by the
bonded official.
Any person who violates this chapter or fails to comply with
any provision thereon shall, upon conviction thereof, be subject to
a fine of not more than $2,000, imprisonment for not more than 90
days or a period of community service not to exceed 90 days, or any
combination thereof.
