SB 937

substitute for
Senate BILL NO. 937
A bill to amend 1987 PA 96, entitled
"The mobile home commission act,"
by amending sections 35, 41, 43, and 48 (MCL 125.2335,
125.2341, 125.2343, and 125.2348), sections 43 and 48 as amended by 2015 PA 40,
and by adding section 30m.
the peoplE of the state of michigan enact:
Sec. 30m. (1)
Except as otherwise provided under subsection (7), an owner of a mobile home
park or seasonal mobile home park shall not make a final unconditional
acceptance of an offer for the sale or transfer of a mobile home park or
seasonal mobile home park without first notifying the residents of the mobile
home park or seasonal mobile home park and the department of the owner of the
mobile home park or seasonal mobile home park's intent to sell or transfer the
mobile home park or seasonal mobile home park and requesting that the residents
notify the owner in writing within 60 days after receipt of the notice from the
owner that they intend to purchase the mobile home park or seasonal mobile home
park. The notice from the owner required under this subsection may be
accompanied by a confidentiality or nondisclosure agreement to be signed by any
person receiving the sale price, terms of sale, and books and records of the
mobile home park or seasonal mobile home park. A confidentiality or
nondisclosure agreement must not be structured in a way that creates an
unreasonable barrier to raising money to purchase the mobile home park or
seasonal mobile home park.
(2) If the residents of the mobile home park or seasonal mobile home
park do not provide the written notice within the time period described under
subsection (1), the owner of the mobile home park or seasonal mobile home park
does not have any further obligations under this section.
(3) If the residents of the mobile home park or seasonal mobile home
park want to purchase the mobile home park or seasonal mobile home park, they
must, within the 60-day period described under subsection (1), send a written
notice to the owner that they have incorporated a homeowners' association or
cooperative and intend to purchase the mobile home park or seasonal mobile home
park. If the owner requires a confidentiality or nondisclosure agreement, the
residents must include the confidentiality or nondisclosure agreement signed by
any person receiving the sale price, terms of sale, and books and records of
the mobile home park or seasonal mobile home park. On receipt of the written
notice described under this subsection, the owner shall provide the sale price,
terms of sale, and books and records of the mobile home park or seasonal mobile
home park to the homeowners' association or cooperative incorporated by the
residents of the mobile home park or seasonal mobile home park. Within 45 days
after the owner provides the sale price, terms of sale, and books and records
of the mobile home park or seasonal mobile home park, the homeowners'
association or cooperative may provide a written offer to purchase the mobile
home park or seasonal mobile home park. The written offer must include a
proposed due diligence, financing, and closing period and documentation that
shows that the owners of more than 50% of the owner-occupied mobile homes in
the mobile home park or seasonal mobile home park support the offer and that
the homeowners' association or cooperative is working with a financing entity
to secure financing for the purchase of the mobile home park or seasonal mobile
home park and attests that the homeowners' association or cooperative has the
financial ability to operate the mobile home park or seasonal mobile home park and
would reasonably be expected to qualify for licensure under this act. The owner
must consider the written offer and negotiate in good faith with the
homeowners' association or cooperative regarding a potential purchase of the
mobile home park or seasonal mobile home park. If the homeowners' association
or cooperative does not provide a written offer to purchase the mobile home
park or seasonal mobile home park after the owner provides the sale price,
terms of sale, and books and records of the mobile home park or seasonal mobile
home park, the owner has no further obligation under this section.
(4) If an owner requires a confidentiality or nondisclosure agreement
and the residents of the mobile home park or seasonal mobile home park disclose
information in violation of the confidentiality or nondisclosure agreement, the
owner is no longer required to comply with this section.
(5) Notice required under this section must be made by certified mail,
return receipt requested.
(6) A resident of a mobile home park or seasonal mobile home park who
alleges that an owner of a mobile home park or seasonal mobile home park failed
to comply with this section may bring an action in a court of competent
jurisdiction to recover actual damages incurred as a result of a violation of
this section. The court may award a civil fine of not less than $10,000.00 but
not more than $250,000.00. The court shall consider the severity of the violation and
the total sales price of the mobile home park or seasonal mobile home park in
determining the civil fine imposed under this
subsection. The civil fine imposed under this subsection is the sole and
exclusive remedy for a violation of this section. The failure of an owner of a
mobile home park or seasonal mobile home park to comply with this section does
not affect the sale or transfer of the mobile home park or seasonal mobile home
park, or constitute grounds to set aside the sale or transfer of the mobile
home park or seasonal mobile home park.
(7) An owner of a mobile home park or seasonal mobile home park is not
required to give the notice as described under subsection (1) or comply with
this section if any of the following apply:
(a) A bank, mortgage company, or any other mortgagee has foreclosed on
the mobile home park or seasonal mobile home park and the bank, mortgage
company, or any other mortgagee does either of the following:
(i) Sells the
mobile home park or seasonal mobile home park at a foreclosure sale.
(ii) Sells the
mobile home park or seasonal mobile home park after purchasing the mobile home
park or seasonal mobile home park at a foreclosure sale.
(b) The sale or transfer of the mobile home park or seasonal mobile home
park is to a family member of the owner of the mobile home park or seasonal
mobile home park or a trust of which the beneficiaries are family members of
the owner of the mobile home park or seasonal mobile home park.
(c) The sale or transfer of the mobile home park or seasonal mobile home
park is by a partnership to 1 or more of its partners.
(d) The conveyance of an interest in the mobile home park or seasonal
mobile home park is incidental to the financing of the mobile home park or
seasonal mobile home park.
(e) The sale or transfer of the mobile home park or seasonal mobile home
park was made in accordance with an eminent domain order.
(f) The sale or transfer of the mobile home park or seasonal mobile home
park is among members of a limited liability company that have been members of
the limited liability company for at least 1 year.
(g) The sale or transfer of the mobile home park or seasonal mobile home
park is to a parent, subsidiary, or affiliate of the owner of the mobile home
park or seasonal mobile home park, if the owner of the mobile home park or
seasonal mobile home park is a company.
(8) An owner of a mobile home park or seasonal mobile home park shall
not accept or conditionally accept an offer for the sale, lease, or transfer of
the mobile home park or seasonal mobile home park that contains any provision
preventing or penalizing the owner of the mobile home park or seasonal mobile
home park for entering into a purchase agreement with a homeowners' association
or cooperative incorporated by the residents.
(9) This section does not allow a resident of a mobile home park or
seasonal mobile home park to attach the civil fine imposed under this section
to the mobile home park or seasonal mobile home park sold or transferred in
violation of this section.
Sec. 35. (1) A person who that applies
for a license to own a mobile home park or seasonal
mobile home park or a construction permit
under this act, which
is for other than a domestic corporation,
shall file with the commission, department, in a form the commission department prescribes,
an irrevocable consent to service of process appointing
the commission department
to be its the
person's attorney to receive service of lawful process in any
noncriminal action or proceeding against it or its that person or that person's successor, executor, or
administrator ,
which that arises under this act or a
rule promulgated or order issued under this act after the consent to service of process is filed. , Service of process under this subsection applies with
the same force and validity as if served personally on the person filing the
consent to service of process.
(2) When a person,
including a nonresident of this state, engages in conduct prohibited or made
actionable by this act or a rule promulgated or order issued under this act,
whether or not consent to service of process was filed and personal
jurisdiction over him or her that person cannot otherwise be obtained in this
state, engagement in that conduct shall be prohibited or
made actionable by this act or a rule promulgated or order issued under this
act is considered equivalent to his or her the person's appointment of the commission to be his or her the person's attorney
to receive service of lawful process in a noncriminal action or proceeding
against him or her or his or her that person or the person's successor, executor, or
administrator. which
grows out of that conduct and which is brought under this act or a rule
promulgated or order issued under this act, Service
of process under this subsection applies with the same force and
validity as if served on the person personally.
(3) Service of process under subsection (1) or (2) may be made by
filing a copy of the process in the office of the commission together with a
$25.00 fee. The service is not effective unless the
plaintiff, which may be the commission in an
action or proceeding instituted by it, immediately sends notice of the
service and a copy of the process within 5 days of the
receipt of the process, by registered or certified mail to the defendant or respondent at his or her last known Michigan address of the
defendant or respondent or takes other steps which that are
reasonably calculated to give actual notice , and the plaintiff's to
the defendant or respondent. The commission shall file an affidavit or other proof of compliance with this section is filed in the case on or before the return day
of the process, if any, or within such further time as the court allows.
Sec. 41. (1) The
department, a prosecuting attorney, or municipal attorney may bring an action
in a court of competent jurisdiction against a person to enjoin that person
from engaging or continuing in a violation of this act
, or a
rule promulgated under this act.
(2) If an
owner of a mobile home park or seasonal mobile home park owns the mobile home
park or seasonal mobile home park without a license and does not have a
complete application for a license pending with the department, any individual
residing in the mobile home park or seasonal mobile home park may, subject to
subsection (3), bring an action in a court of competent jurisdiction for
injunctive relief, damages, or attorney fees and costs. If the court finds that
the owner of a mobile home park or seasonal mobile home park owns the mobile
home park or seasonal mobile home park without a license and that a complete
application for a license is not pending with the department before the filing
of the action, the court may do any of the following:
(a) Order
an injunctive relief. Injunctive relief under this subdivision includes, but is
not limited to, any of the following:
(i) Issuing a permanent or temporary injunction or
restraining order to enforce the licensing provisions of this act.
(ii) Issuing a declaratory judgment that owning a mobile home
park or seasonal mobile home park without a license violates this act.
(iii) Enjoining the owner of a mobile home park or seasonal
mobile home park from owning a mobile home park or seasonal mobile home park
without a license.
(b) Award
statutory damages of not more than $10,000.00 or penalties as described under
section 42, and attorney fees and costs.
(3) Before
commencing an action under this section, the individual must provide the owner
of the mobile home park or seasonal mobile home park with a written notice of
action on the claim. The notice of action required under this subsection must
include all of the following statements:
(a) That,
based on the information obtained from the department's mobile home park
database, the individual has a good-faith belief that the owner of the mobile
home park or seasonal mobile home park owns the mobile home park or seasonal
mobile park without a license and has not submitted a complete license
application to the department in accordance with this act.
(b) That the
owner of the mobile home park or seasonal mobile home park has 30 days from the
date of receipt of the notice of action to provide the individual with evidence
that the owner of the mobile home park or seasonal mobile home park owns the
mobile home park or seasonal mobile home park with a valid license or has a
complete license application pending with the department.
(c) That, if
the owner of the mobile home park or seasonal mobile home park fails to provide
the information described under subdivisions (a) and (b), the individual may
file an action in a court of competent jurisdiction as provided under this
section.
(4) The
notice of action required under this section must be delivered by personal
service or sent by registered or certified mail, return receipt requested.
(5) If,
after the filing of an action in accordance with this section, an owner of a
mobile home park or seasonal mobile home park submits a complete license application
to the department, the court may issue injunctive relief or award damages or
attorney fees and costs as described under this section.
(6) If a
court awards damages under this section, the court shall order the plaintiff to
disburse any money awarded in damages among all residents of the mobile home
park or seasonal mobile home park on a pro rata basis, on receipt of the funds.
(7) If an
individual files an action in accordance with this section against an owner of
a mobile home park or seasonal mobile home park and obtains monetary
compensation under this section that is distributed in accordance with
subsection (6), that individual and a resident of the mobile home park or
seasonal mobile home park that received money under this section shall not file
any action under this section against an owner of the mobile home park or
seasonal mobile home park for at least 12 months after the date of the
judgment.
(8) If a
person brings an action against an owner of a mobile home park or seasonal
mobile home park alleging that the owner of the mobile home park or seasonal
mobile home park owns the mobile home park or seasonal mobile home park without
a license but it is determined that the person brought the action knowing that
the owner of the mobile home park or seasonal mobile home park is licensed or
has submitted a complete license application and did not follow the
requirements of this section, the court may award costs or impose remedies in
accordance with section 2591 of the revised judicature act of 1961, 1961 PA
236. MCL 600.2591 or MCR 1.109(E).
Sec. 43. (1) If, after notice and a
hearing as provided in the administrative procedures act of 1969, 1969 PA 306,
MCL 24.201 to 24.328, a person is determined to have violated this act, the
commission may impose do any of the following:
(a) Impose 1 or
more of the following penalties:
(i) (a) Censure.
(ii) (b) Probation.
(iii) (c) License limitation.
(iv) (d) License suspension. The commission may
request the appointment of a receiver when taking action under this
subdivision.
(v) (e) License revocation. The commission may
request the appointment of a receiver when taking action under this
subdivision.
(vi) (f) License denial.
(vii) An
administrative fine of not more than $5,000.00.
(viii) (g) A civil fine of not more than $50,000.00.
(ix) (h) Restitution.
(b) Require posting financial assurance in the form of a bond, cash
deposit, or other financial arrangement and in an amount the commission
considers necessary to maintain or repair any infrastructure or facilities of a
mobile home park or seasonal mobile home park to ensure the health, safety, and
welfare of the residents of the mobile home park or seasonal mobile home park.
(c) Request the appointment of a receiver. This subdivision applies if
the violation is the operation of a mobile home park or seasonal mobile home
park without a license issued by the department and the department complied
with the requirements of subsection (2).
(2) If the department determines that a mobile home park or seasonal
mobile home park located in this state is owned by a person that does not have
a license issued by the department to own that mobile home park or seasonal
mobile home park, the department shall provide written notice to the unlicensed
owner of the mobile home park or seasonal mobile home park. The department
shall forward a copy of the written notice provided to an unlicensed owner of a
mobile home park or seasonal mobile home park under this subsection to the
clerk of the city, village, or township where the mobile home park or seasonal
mobile home park is located. The written notice provided under this subsection
must require the unlicensed owner of the mobile home park or seasonal mobile
home park to apply to the department for licensure within 30 days of the date
of the notice. If the unlicensed owner of the mobile home park or seasonal
mobile home park does not apply for licensure within the 30-day period provided
under this subsection, the department shall commence proceedings to impose a
fine on the unlicensed owner of the mobile home park or seasonal mobile home
park. If the department determines that a person owned or owns a mobile home
park or seasonal mobile home park without a license as required under section
16, the department shall impose a fine of not more than $250,000.00 after
notice and a hearing as provided under the administrative procedures act of
1969, 1969 PA 306, MCL 24.201 to 24.328. The department shall advise the
attorney general of the failure of any person to pay any fine imposed under
this section. The attorney general shall bring a civil action in a court of
competent jurisdiction to recover the fine. In addition to the written notice
described under this subsection, the department shall send a written notice to
all identified lienholders of the mobile home park or seasonal mobile home park
notifying them that the mobile home park or seasonal mobile home park is
operating without a license. The department may charge a fee of up to $250.00
for identifying the lienholders if the owner of the mobile home park or
seasonal mobile home park has not informed the department of all lienholders as
required under this act. Notwithstanding subsection (1)(c), the department, a
local unit of government, or a resident may request the appointment of a
receiver.
(3) (2) A fine imposed under subsection (1) may be
collected by the imposition of a judgment lien by a court or by obtaining a
writ of garnishment against the person who has been determined to have violated
this act. A writ of garnishment under this section must be issued by a court of
competent jurisdiction and directed to this state or the state treasurer to
satisfy the fine. To obtain a writ of garnishment under this subsection, the
department must comply with the requirements of chapter 40 of the revised
judicature act of 1961, 1961 PA 236, MCL 600.4001 to 600.4065. A fine collected under this section shall must be
deposited with the state treasurer and credited to the mobile home code license enforcement fund
created in section 9.16c.
(4) The department may not issue a license until the fees and any
administrative fines previously assessed against the applicant and any person
that holds a beneficial interest in the applicant's mobile home park or
seasonal mobile home park by the department or commission that remain unpaid at
the time of the license application, if applicable, are paid as provided under
section 16(2)(c). The department shall advise the attorney general of the
failure of any person to pay the fees or fines imposed under section 16. The
attorney general shall, within 90 days of receiving notice from the department,
bring a civil action in a court of competent jurisdiction to recover the fees
or fines.
(5) (3) If
the department determines that the owner or operator of a mobile home park or
seasonal mobile home park has violated this act or rules promulgated under this
act by failing to maintain or repair any infrastructure or facilities of the
mobile home park or seasonal mobile home park, the department shall give notice
of the determination by personal service or first-class mail to the local
governments where the mobile home park is located , and the owner , the operator, of the mobile home park or seasonal mobile home park and,
if financial assurance in the form of a bond has been posted under rules promulgated under section 16(2), 16, the
surety executing the bond. If the department
determines that a mobile home park or seasonal mobile home park has violated
this act or rules promulgated under this act in a manner that causes a material
deficiency, the department shall give notice of that determination to all secured
parties by personal service or first-class mail, and by email, if available. If
the owner , operator,
of the mobile home park or seasonal mobile home
park or surety does not perform or commence the specified maintenance or
repair within 60 days after service of the notice, the department or its
authorized representative may enter the mobile home park or seasonal mobile
home park and perform the specified maintenance or repair. At the request of
the owner ,
operator, of the mobile home park or seasonal
mobile home park or surety, the department may grant an extension of up
to an additional 90 days. The owner , operator, of the mobile
home park or seasonal mobile home park and any surety are jointly and
severally liable for all expenses incurred by the department or its authorized
representative in performing the specified maintenance or repair. The
department shall certify the claim to the owner , operator, of the mobile
home park or seasonal mobile home park and any surety, listing in the
claim the items of expense in performing the maintenance or repair, and shall
draw on any financial assurance for the payment of the claim. The department
shall notify the local government where the mobile home park or seasonal mobile home park is located when the
specified maintenance or repair has been completed.
(6) (4) This
section does not prohibit actions from being taken under other sections of this
act.
(7) (5) The
pursuit in court of the lawful rights of a licensee does not constitute a
violation of this act, regardless of the outcome of the court action.
(8) If it is determined that an owner of a mobile home park or seasonal
mobile home park is unlicensed and there is no complete license application
under review by the department, the department, lienholder, other affected
person, or a resident of the mobile home park or seasonal mobile home park may
petition the circuit court in the county in which the mobile home park or
seasonal mobile home park is located to appoint a receiver to operate the
mobile home park or seasonal mobile home park during the period in which the
owner of the mobile home park or seasonal mobile home park is unlicensed. If
the court finds that the owner of the mobile home park or seasonal mobile home
park is unlicensed and there is no complete license application under review by
the department, the court shall appoint a receiver to operate the mobile home
park or seasonal mobile home park. The court shall determine the fair
compensation for the receiver. A receiver appointed under this subsection must
be a person currently licensed to own a mobile home park or seasonal mobile
home park in accordance with this act or a person that meets the requirements
for licensure under this act, as determined by the court. A receiver may not be
the owner of the mobile home park or seasonal mobile home park, or a
subsidiary, immediate family member, agent, attorney, representative, employee,
or affiliate of the owner of the mobile home park or seasonal mobile home park,
or any other person that is responsible for the day-to-day operation of the
mobile home park or seasonal mobile home park or is under common control of the
mobile home park or seasonal mobile home park with the owner of the mobile home
park or seasonal mobile home park. Subject to court approval, a receiver
appointed under this subsection shall do any of the following:
(a) Repair, renovate, or rehabilitate the mobile home park or seasonal
mobile home park as needed to make the mobile home park or seasonal mobile home
park comply with this act.
(b) Manage the mobile home park or seasonal mobile home park.
(c) Collect rent, utility service fees, and other fees from the
residents of the mobile home park or seasonal mobile home park, as determined
by the court, and pay the expenses of the mobile home park or seasonal mobile
home park that are necessary to ensure continuing operation and services.
(d) Pursue necessary legal remedies against a resident of the mobile
home park or seasonal mobile home park that fails to pay rent, utility service
fees, or other fees or comply with this act. Legal remedies that may be pursued
against a resident of the mobile home park or seasonal mobile home park under this
subdivision include, but are not limited to, the institution of summary
proceedings to recover possession of the premises from the resident of the
mobile home park or seasonal mobile home park.
(e) Exercise other powers the court considers proper to the effective
administration of the receivership including, but not limited to, selling the
park with court approval.
Sec. 48. (1) If the department orders the
owner or operator of a mobile home park or
seasonal mobile home park to correct a violation of this act or rules
promulgated under this act that imminently threatens the health or safety of
the residents of the mobile home park or seasonal
mobile home park or the public and the owner or operator fails to comply with the order, the
department or the local government may bring an action to enforce the
applicable regulations and to abate or enjoin the violation.
(2) If the
violation is not corrected and imminently threatens the health or safety of the
residents of the mobile home park or seasonal mobile home park or the public,
the department or the local government may file a motion for a preliminary
injunction or other temporary relief appropriate to remove the threat while the
action is pending.
(3) The department
or the local government shall serve a copy of the complaint and a summons on
each owner, secured party, and lienholder of
record , and any
operator, of the mobile home park or seasonal mobile home park that can
be identified by the department or the local government with the exercise of
reasonable diligence. The local government shall also file a notice of the
action with the register of deeds for the county where the mobile home park or seasonal mobile home park is
located.
(4) The court shall
make orders and determinations consistent with the objectives of this act. The
court may enjoin the maintenance of an unsafe, unhealthy, or unsanitary
condition, or a violation of the applicable regulations, and may order the
defendant to perform maintenance and repairs or make other corrections
including removal of a building or structure necessary to abate the condition.
The court may authorize the department or the local government to perform
maintenance or repairs or to remove a building or structure owned or operated
by the owner or operator of the mobile home
park or seasonal mobile home park. However, the court shall not authorize
removal of a building or structure unless the cost of repair of the building or
structure will be greater than the state equalized value of the building or
structure.
(5) If the expense
of maintenance, repair, or removal is not provided
for by financial assurance under section 16(2)(b) or otherwise provided
for, the court may enter an order approving the expense and place a lien on the
real property for the payment of the expense. The order may establish the lien
as a senior lien, except as to tax and assessment liens, and except as to a mortgage
of first priority recorded prior to all other liens of record. The order may
also specify the time and manner for foreclosure of the lien if the lien is not
satisfied. To perfect the lien, a copy of the order shall must be
filed with the register of deeds for the county where the mobile home park or
seasonal mobile home park is located within 10 days after entry of the order.
Enacting section 1.
This amendatory act does not take effect unless all of the following bills of
the 103rd Legislature are enacted into law:
(a) Senate Bill No. 934.
(b) Senate Bill No. 935.