18035
. (a) (1) For every transaction by or through a dealer to sell
or lease with the option to buy a new or used manufactured home or
mobilehome subject to registration under this part, the dealer shall
execute in writing and obtain the buyer's signature on a purchase
order, conditional sale contract, or other document evidencing the
purchase contemporaneous with, or prior to, the receipt of any cash
or cash equivalent from the buyer, shall establish an escrow account
with an escrow agent, and shall cause to be deposited into that
escrow account any cash or cash equivalent received at any time prior
to the close of escrow as a deposit, downpayment, or whole or
partial payment for the manufactured home or mobilehome or accessory
thereto. Checks, money orders, or similar payments toward the
purchase shall be made payable only to the escrow agent.
(2) The downpayment, or whole or partial payment, shall include an
amount designated as a deposit, which may be less than, or equal to,
the total amount placed in escrow, and shall be subject to
subdivision (f). The parties shall provide for escrow instructions
that identify the fixed amounts of the deposit, downpayment, and
balance due prior to closing consistent with the amounts set forth in
the purchase documents and receipt for deposit if one is required by
Section 18035.1. The deposits shall be made by the dealer within
five working days of receipt, one of which shall be the day of
receipt.
(3) For purposes of this section, "cash equivalent" means any
property, other than cash. If an item of cash equivalent is, due to
its size, incapable of physical delivery to the escrowholder, the
property may be held by the dealer for the purchaser until close of
escrow and, if the property has been registered with the department
or the Department of Motor Vehicles, its registration certificate
and, if available, its certificate of title shall be delivered to the
escrowholder.
(b) For every transaction by or through a dealer to sell or lease
with the option to buy a new manufactured home or mobilehome subject
to registration under this part, the escrow instructions shall
provide all of the following:
(1) That the original manufacturer's certificate of origin be
placed in escrow.
(2) (A) That, in the alternative, either of the following shall
occur:
(i) The lien of any inventory creditor on the manufactured home or
mobilehome shall be satisfied by payment from the escrow account.
(ii) The inventory creditor shall consent in writing to other than
full payment.
(B) For purposes of this paragraph, "inventory creditor" includes
any person who is identified as a creditor on the manufacturer's
certificate of origin or any person who places the original
certificate of origin in escrow and claims in writing to the escrow
agent to have a purchase money security interest in the manufactured
home or mobilehome, as contemplated by Section 9103 of the Commercial
Code.
(3) That the escrow agent shall obtain from the manufacturer a
true and correct facsimile of the copy of the certificate of origin
retained by the manufacturer pursuant to Section 18093.
(c) For every transaction by or through a dealer to sell or lease
with the option to buy a used manufactured home or mobilehome subject
to registration under this part, the escrow instructions shall
provide:
(1) That the current registration card, all copies of the
registration cards held by junior lienholders, and the certificate of
title be placed in escrow.
(2) That, in the alternative, either of the following shall occur:
(A) (i) The registered owner shall acknowledge in writing the
amount of the commission to be received by the dealer for the sale of
the manufactured home or mobilehome, and (ii) the registered owner
shall release all of its ownership interests in the manufactured home
or mobilehome either contemporaneously upon the payment of a
specified amount from the escrow account or at the close of the
escrow where the buyer has executed a security agreement approved by
the registered owner covering the unpaid balance of the purchase
price.
(B) (i) The dealer shall declare in writing that the manufactured
home or mobilehome is its inventory, (ii) the registered owner shall
acknowledge in writing that the purchase price relating to the sale
of the manufactured home or mobilehome to the dealer for resale has
been paid in full by the dealer, (iii) the current certificate of
title shall be appropriately executed by the registered owner to
reflect the release of all of its ownership interests, and (iv) the
dealer shall release all of its ownership interests in the
manufactured home or mobilehome either contemporaneously upon the
payment of a specified amount from the escrow account or at the close
of escrow where the buyer has executed a security agreement approved
by the dealer covering the unpaid balance of the purchase price.
(3) That, in the alternative, the legal owner and each junior
lienholder, respectively, shall do either of the following:
(A) Release his or her security interest or transfer its security
interest to a designated third party contemporaneously upon the
payment of a specified amount from the escrow account.
(B) Advise the escrow agent in writing that the new buyer or the
buyer's stated designee shall be approved as the new registered owner
upon the execution by the buyer of a formal assumption of the
indebtedness secured by his or her lien approved by the creditor at
or before the close of escrow.
(d) For every transaction by or through a dealer to sell or lease
with the option to buy a used manufactured home or mobilehome subject
to registration under this part:
(1) The dealer shall present the buyer's offer to purchase the
manufactured home or mobilehome to the seller in written form signed
by the buyer. The seller, upon accepting the offer to purchase, shall
sign and date the form. Copies of the fully executed form shall be
presented to both the buyer and seller, with the original copy
retained by the dealer. Any portion of the form that reflects the
commission charged by the dealer to the seller need not be disclosed
to the buyer.
(2) The escrow agent, upon receipt of notification from the dealer
that the seller has accepted the buyer's offer to purchase and
receipt of mutually endorsed escrow instructions, shall, within three
working days, prepare a notice of escrow opening on the form
prescribed by the department and forward the completed form to the
department with appropriate fees. If the escrow is canceled for any
reason before closing, the escrow agent shall prepare a notice of
escrow cancellation on the form prescribed by the department and
forward the completed form to the department.
(3) (A) The escrow agent shall forward to the legal owner and each
junior lienholder at their addresses shown on the current
registration card a written demand for a lien status report, as
contemplated by Section 18035.5, and a written demand for either an
executed statement of conditional lien release or an executed
statement of anticipated formal assumption, and shall enclose blank
copies of a statement of conditional lien release and a statement of
anticipated formal assumption on forms prescribed by the department.
The statement of conditional lien release shall include, among other
things, both of the following:
(i) A statement of the dollar amount or other conditions required
by the creditor in order to release or transfer its lien.
(ii) The creditor's release or transfer of the lien in the
manufactured home or mobilehome contingent upon the satisfaction of
those conditions.
(B) The statement of anticipated formal assumption shall include,
among other things, both of the following:
(i) A statement of the creditor's belief that the buyer will
formally assume the indebtedness secured by its lien pursuant to
terms and conditions which are acceptable to the creditor at or
before the close of escrow.
(ii) The creditor's approval of the buyer or his or her designee
as the registered owner upon the execution of the formal assumption.
(4) Within five days of the receipt of the written demand and
documents required by paragraph (3), the legal owner or junior
lienholder shall complete and execute either the statement of
conditional lien release or, if the creditor has elected to consent
to a formal assumption requested by a qualified buyer, the statement
of anticipated formal assumption, as appropriate, and prepare the
lien status report and forward the documents to the escrow agent by
first-class mail. If the creditor is the legal owner, the certificate
of title in an unexecuted form shall accompany the documents. If the
creditor is a junior lienholder, the creditor's copy of the current
registration card in an unexecuted form shall accompany the
documents.
(5) If either of the following events occurs, any statement of
conditional lien release or statement of anticipated formal
assumption executed by the creditor shall become inoperative, and the
escrow agent shall thereupon return the form and the certificate of
title or the copy of the current registration card, as appropriate,
to the creditor by first-class mail:
(A) The conditions required in order for the creditor to release
or transfer his or her lien are not satisfied before the end of the
escrow period agreed upon in writing between the buyer and the seller
or, if applicable, before the end of any extended escrow period as
permitted by subdivision (g).
(B) The registered owner advises the creditor not to accept any
satisfaction of his or her lien or not to permit any formal
assumption of the indebtedness and the creditor or registered owner
advises the escrow agent in writing accordingly.
(6) If a creditor willfully fails to comply with the requirements
of paragraph (4) within 21 days of the receipt of the written demand
and documents required by paragraph (3), the creditor shall forfeit
to the escrow agent three hundred dollars ($300), except where the
creditor has reasonable cause for noncompliance. The three hundred
dollars ($300) shall be credited to the seller, unless otherwise
provided in the escrow instructions. Any penalty paid by a creditor
under this paragraph shall preclude any civil liability for
noncompliance with Section 18035.5 relating to the same act or
omission.
(e) For every transaction by or through a dealer to sell or lease
with the option to buy a new or used manufactured home or mobilehome,
the escrow instructions shall specify one of the following:
(1) Upon the buyer receiving delivery of an installed manufactured
home or mobilehome on the site and the manufactured home or
mobilehome passing inspection pursuant to Section 18613 or after the
manufactured home or mobilehome has been delivered to the location
specified in the escrow instructions when the installation is to be
performed by the buyer, all funds in the escrow account, other than
escrow fees and amounts for accessories not yet delivered, shall be
disbursed. If mutually agreed upon between buyer and dealer, the
escrow instructions may specify that funds be disbursed to a
government agency for the payment of fees and permits required as a
precondition for an installation acceptance or certificate of
occupancy, and the information that may be acceptable to the escrow
agent.
(2) Upon the buyer receiving delivery of an installed manufactured
home or mobilehome not subject to the provisions of Section 18613
with delivery requirements as mutually agreed to and set forth in the
sales documents, all funds in the escrow account, other than escrow
fees, shall be disbursed.
(f) Upon receiving written notice from a party to the escrow of a
dispute, the escrow agent shall inform the party of his or her right
to hold funds in escrow by submitting a written request to hold funds
in escrow. Upon receipt by the escrow agent of a party's written
request to hold funds in escrow, all funds denoted as deposit shall
be held in escrow until a release is signed by the disputing party,
or pursuant to new written escrow instructions signed by the parties
involved, or pursuant to a final order for payment or division by a
court of competent jurisdiction. Any other funds, other than escrow
fees, shall be returned to the buyer or any person, other than the
dealer or seller, as appropriate. At the opening of escrow, the
escrow agent shall give notice of the right to request that funds be
held in escrow pursuant to this subdivision.
(g) Escrow shall be for a period of time mutually agreed upon, in
writing, by the buyer and the seller. However, the parties may, by
mutual consent, extend the time, in writing, with notice to the
escrow agent.
(h) No dealer or seller shall establish with an escrow agent any
escrow account in an escrow company in which the dealer or seller has
more than a 5-percent ownership interest.
(i) The escrow instructions may provide for the proration of any
local property tax due or to become due on the manufactured home or
mobilehome, and if the tax, or the license fee imposed pursuant to
Section 18115, or the registration fee imposed pursuant to Section
18114, is delinquent, the instructions may provide for the payment of
the taxes or fees, or both, and any applicable penalties.
(j) For every transaction by or through a dealer to sell or lease
with the option to buy a new or used manufactured home or mobilehome
that is subject to inspection pursuant to Section 18613, and for
which it is stated, on the face of the document certifying or
approving occupancy or installation, that the issuance of the
document is conditioned upon the payment of a fee, charge,
dedication, or other requirement levied pursuant to Section 53080 of
the Government Code, the escrow instructions shall provide that the
payment of that fee, charge, dedication, or other requirement be made
to the appropriate school district upon the close of escrow.
(k) No agreement shall contain any provision by which the buyer
waives his or her rights under this section, and any waiver shall be
deemed contrary to public policy and shall be void and unenforceable.
(l) If a portion of the amount in the escrow is for accessories,
then that portion of the amount shall not be released until the
accessories are actually installed.
(m) Upon opening escrow on a used manufactured home or mobilehome
which is subject to local property taxation, and subject to
registration under this part, the escrow officer may forward to the
tax collector of the county in which the used manufactured home or
mobilehome is located, a written demand for a tax clearance
certificate, if no liability exists, or a conditional tax clearance
certificate if a tax liability exists, to be provided on a form
prescribed by the office of the Controller. The conditional tax
clearance certificate shall state the amount of the tax liability
due, if any, and the final date that amount may be paid out of the
proceeds of escrow before a further tax liability may be incurred.
(1) Within five working days of receipt of the written demand for
a conditional tax clearance certificate or a tax clearance
certificate, the county tax collector shall forward the conditional
tax clearance certificate or a tax clearance certificate showing no
tax liability exists to the requesting escrow officer. In the event
the tax clearance certificate's or conditional tax clearance
certificate's final due date expires within 30 days of date of
issuance, an additional conditional tax clearance certificate or a
tax clearance certificate shall be completed which has a final due
date of at least 30 days beyond the date of issuance.
(2) If the tax collector on which the written demand for a tax
clearance certificate or a conditional tax clearance certificate was
made fails to comply with that demand within 30 days from the date
the demand was mailed, the escrow officer may close the escrow and
submit a statement of facts certifying that the written demand was
made on the tax collector and the tax collector failed to comply with
that written demand within 30 days. This statement of facts may be
accepted by the department in lieu of a conditional tax clearance
certificate or a tax clearance certificate, as prescribed by
subdivision (a) of Section 18092.7, and the transfer of ownership may
be completed.
(3) The escrow officer may satisfy the terms of the conditional
tax clearance certificate by paying the amount of tax liability shown
on the form by the tax collector out of the proceeds of escrow on or
before the date indicated on the form and by certifying in the space
provided on the form that all terms and conditions of the
conditional tax clearance certificate have been complied with.
(n) This section creates a civil cause of action against a buyer
or dealer or other seller who violates this section, and upon
prevailing, the plaintiff in the action shall be awarded actual
damages, plus an amount not in excess of two thousand dollars
($2,000). In addition, attorney's fees and court costs shall also be
awarded a plaintiff who prevails in the action.