[HISTORY: Adopted by the Town Board of the Town of Brookhaven 6-16-1987 by L.L. No. 7-1987. Amendments noted where applicable.]
When used in this chapter, the following terms, unless the context requires otherwise, shall have the following meanings:
- 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 vendee wherein the vendor undertook to build or construct a home for the vendee or where the vendor becomes insolvent.
- Communication of actual notice to the vendor of requests made therein.
- 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 vendee wherein the vendor undertook to build or construct a home for the vendee.
- A new one- or two-family dwelling intended to be used primarily as a residence.
- The unincorporated area of the Town of Brookhaven outside the incorporated villages located within the Town.
- 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.
- 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 in the Town for a vendee and such vendee is required to pay a deposit to such vendor, the vendor shall post with the Commissioner of Finance a bond in the amount of such deposit or deposits. Such bond shall be posted within five business days after the 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 shall be in such form as required by the New York State Superintendent of Insurance.
In lieu of posting a bond as provided in § 41-2, the vendor shall place the deposit or deposits paid to him by the vendee in an interest-bearing escrow account with a bank as defined in the New York State Banking Law within five 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.
No building permit for a home to be constructed subject to the provisions of this chapter shall be issued by the Building Division of the Town of Brookhaven until satisfactory proof of compliance with this chapter is demonstrated by the vendor of such home or the building permit applicant.
Each applicant for a building permit to construct a new home subject to the provisions of this chapter shall, in addition to the information and exhibits otherwise required by the Code of the Town of Brookhaven to obtain a building permit, execute an affidavit of compliance with this chapter to the Building Division on forms to be supplied by the Building Division. In the event that a bond is obtained pursuant to § 41-2 herein, such bond shall be posted with the Building Department and thereafter forwarded by the Building Department to the Commissioner of Finance. In the event that the deposit is placed in an escrow account pursuant to § 41-3 herein, such applicant shall swear to that effect in the affidavit and submit proof that such deposit was placed in escrow. In the event that the applicant has not contracted with a vendee for the construction of a new home or otherwise has not received a deposit, such applicant shall swear to that effect in the affidavit and further guarantee that if a contract to construct a home for which building permit is applied for is executed and a deposit is given as consideration for such contract, such applicant shall, at the time such deposit is given, secure such deposit pursuant to § 41-2 or 41-3 of this chapter.
When application is made for a certificate of occupancy for a home subject to the provisions of this chapter, the applicant shall submit adequate proof to the Building Department that either the deposit is still held in escrow or that the bond is still in full force and effect. The Building Department shall verify the continuation of such surety by either contacting the bank at which the deposit is held in escrow or by contacting the surety guaranteeing payment of the deposit in the event of default. No certificate of occupancy for a home subject to the provisions of this chapter shall be issued unless the deposit is still secured at the time application is made for such certificate of occupancy.
Upon default by the vendor, the vendee may demand return of his deposit or deposits from the vendor. If the vendor has placed the deposit or deposits in an escrow account pursuant to § 41-3, he shall physically transfer the account to the vendee within 14 business days after the day on which said demand was made. If the vendor has posted a bond pursuant to § 41-2, the vendee may initiate action for payment thereon if his deposit or deposits have not been paid to such vendee within 14 business days after the day in which said demand was made.
Failure of the vendor to comply with any of the provisions of this chapter is a misappropriation of funds, and action may be brought by the vendee against the vendor for the return of any moneys advanced. In addition, such vendor shall be liable for criminal action pursuant to the provisions of Subsection B of this section.
Failure of the vendor to comply with any of the provisions of this chapter shall be deemed a misdemeanor.
Nothing in this chapter shall impair, limit or reduce the statutory, common law or contractual duties or liability of any vendor in the construction of a home, nor shall these provisions apply to any local law or ordinance which requires the posting of public improvement bonds.