[Adopted 10-9-1990 as L.L. No. 6-1990]
The Town Board of the Town of Clarkstown, being
aware of the exposure to loss, because of a builder's financial failure,
of contract deposits placed with a builder for the purchase of a new
one- or two-family residence or residential condominium in the Town
of Clarkstown, and further realizing that it is the desire on the
part of all responsible persons in the building and construction industry
in the Town of Clarkstown to preserve their reputations from the adverse
effect of possible losses of home buyer deposits as above described,
hereby determines that the enactment of this Article, pursuant to
the general powers granted by § 10 of the Municipal Home
Rule Law and the specific authority of Article 37, § 779,
of the General Business Law, will contribute to the public welfare
and safety and to the orderly development of the Town of Clarkstown
and will reinforce public confidence in the financially responsible
builders and contractors in the Town of Clarkstown.
When used in this Article, the following terms,
unless the context requires otherwise, shall have the following meanings:
DEFAULT
Occurs where title to the home is not transferred to the
vendee because of the failure of the vendor to substantially perform
those provisions of the agreement between the vendor and the vendee
wherein the vendor undertook to build or construct a home for the
vendee or where the vendor becomes insolvent.
DEMAND
Communication of an actual notice to the vendor of requests
made therein.
DEPOSIT
Any moneys given as down payment by the vendee to the vendor
as required by the vendor prior to the commencement of the work to
be performed pursuant to an agreement between the vendor and the vendee
wherein the vendor undertook to build or construct a home for the
vendee.
HOME
A new one- or two-family dwelling intended to be used primarily
as a residence.
TOWN
The Town of Clarkstown.
VENDEE
Any individual or individuals who have contracted with a
vendor for construction of a home on land not owned at the time of
such agreement by such individual or individuals.
VENDOR
Any person, firm, corporation or association engaged in the
business of erecting or constructing homes.
When a vendor undertakes to build or construct
a home for a vendee within the Town of Clarkstown, and such vendee
is required to pay a deposit to such vendor, the vendor shall post
with the Town Attorney a bond or letter of credit in the amount of
such deposit or deposits. Such bond or letter of credit shall be posted,
within five (5) business days after receipt of said deposit or deposits,
by the vendor and shall secure the payment of said deposit to the
vendee upon the vendor's default. Such bond or letter of credit shall
be in such form as required by the Town Attorney.
In lieu of posting a bond or letter of credit
as provided in this Article, the vendor shall place the deposit or
deposits paid to him or her by the vendee in an interest-bearing escrow
account with a bank, as defined in the Banking Law, within five (5)
business days after receipt of such deposit or deposits. Such deposit
or deposits, together with interest accumulated thereon, shall remain
the property of the vendee, except as otherwise provided herein. Verification
of the escrow account must be submitted by the bank to the Town Attorney
within five (5) business days after receipt by the bank of such deposit
or deposits.
Any agreement entered into by a vendee which
waives, limits or disclaims the rights or obligations set forth in
this Article shall be void as contrary to public policy.