HB6854 93RD GENERAL ASSEMBLY

LRB093 19913 LCB 45656 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB6854

Introduced 02/09/04, by Kevin Joyce

SYNOPSIS AS INTRODUCED:

New Act

Creates the New Residential Building and Sales Contract Act. Lists requirements that must be stated in every contract for the construction and sale or contract for the sale of a new residential living unit. Provides for the greater of actual damages or $5,000, plus reasonable costs and attorney's fees for violation of the Act.

A BILL FOR

AN ACT concerning contracts.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the New Residential Building and Sales Contract Act.

Section 5. Compliance. Any contract for the construction and sale or contract for the sale of a new residential living unit is required to comply with the terms and provisions of this Act.

Section 10. Definitions. As used in this Act:

"New residential living unit" means a structure intended to be occupied for residential purposes by a single family, including single family homes, duplexes, and townhouses but excluding condominiums or cooperatives, that has not been previously occupied by a person other than an owner, family member, employee, stockholder, officer, or director of the owner for more than one year and that has had a final certificate of occupancy or been ready to be occupied for less then 3 years.

"Owner" means the person or entity in title to the real estate on which the new residential living unit is or will be located and any employee, agent, or affiliated person or entity of that person or entity in title to the real estate.

Section 15. Contract requirements. Every contract for the construction and sale or contract for the sale of a new residential living unit shall clearly state:

(1) the legal description of the parcel being sold;

(2) that the purchaser has the unconditional option to rescind the contract until midnight of the seventh day following the signing of the contract;

(3) which party is obligated to pay the costs of issuance of the required title policy, recording of all documents, and other similar closing costs;

(4) whether the owner has any interest in any other entities or service providers that the purchaser is required to use in connection with the transaction, such as a title insurance agent, mortgage broker or lender, escrow agent, or insurance brokerage company, the nature of that interest, and any compensation, fee, or other remuneration paid to or received by the owner in connection with the transaction;

(5) the building codes to be followed or that were followed in the construction of the new residential living unit;

(6) that the purchaser is not represented by the owner or his or her employee or agent and that the purchaser should consider seeking representation or advice from a third party unrelated to and unaffiliated with the owner;

(7) that the implied warranty of liability applies, or if not, the terms of the warranty concerning the new residential living unit cannot be for a period of less than one year from the date the buyer occupies the new residential living unit and that the warranty must cover all major systems of the new residential living unit and the workmanship of the owner and all contractors and subcontractors who may have participated in the construction of the new residential living unit;

(8) that the purchaser can place 5% of the purchase price in escrow to be held by the agreed upon escrowee until the owner has closed on the sale of the new residential living unit to purchaser and is ready to turn over occupancy of the new residential living unit to the purchaser; and

(9) all special service areas in which the new residential living unit is located, the purpose of the special service area, and the estimated annual cost to the buyer.

Section 20. Damages. Any contract for the construction and sale or contract for sale of a new residential living unit entered into after the effective date of this Act that does not comply with the provisions of this Act may be rescinded by the purchaser until closing on the new residential living unit, or, if a lawsuit is filed by purchaser after closing but prior to occupancy, the purchaser shall be entitled to recover the greater of the purchaser's actual damages or $5,000, plus reasonable costs and attorney's fees from owner.