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Committee Substitute House Bill 4208 History

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HB4208 SUB
COMMITTEE SUBSTITUTE

for

H. B. 4208

(By Delegates Lawrence, Cowles, Phillips,

Argento, T. Waker, Beach and Fleischauer)


(Originating in the Committee on the Judiciary)

[February 12, 2010]


A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new section, designated §37-6-31; and by adding thereto a new section, designated §38-1-16, all relating to requiring a landlord to give written notice to a prospective tenant when property is subject to foreclosure; requiring a landlord to give written notice to a tenant when property is subject to foreclosure or sale; providing for damages for failure to provide notice; effect of foreclosure on preexisting tenancy; notice of foreclosure; termination of lease prior to end of lease term.

Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended by adding thereto a new section, designated §37-6-31; and by adding thereto a new section, designated §38-1-16, to read as follows:
CHAPTER 37. REAL PROPERTY

ARTICLE 6. LANDLORD AND TENANT.
§37-6-31. Notice of foreclosure.
(a) If at the time of the execution of a residential rental agreement, the premises is subject to any of the following circumstances, the landlord shall disclose that circumstance to the tenant in writing in a separate written statement, signed by the tenant before the execution of the rental agreement, that the owner has provided written notice as required by this subsection:
(1) Any outstanding notice of default under a trust deed, mortgage or contract of sale, or notice of trustee's sale under a trust deed;
(2) Any pending suit to foreclose a mortgage, trust deed or vendor's lien under a contract of sale;
(3) Any pending declaration of forfeiture or suit for specific performance of a contract of sale; or
(4) Any pending proceeding to foreclose a tax lien.
(b) A residential rental agreement that does not include a statement signed by the tenant pursuant to subsection (a) is voidable at the option of the tenant.
(c) If an foreclosure action has been commenced against residential rental property or if a trustee, pursuant to a trust deed, has initiated a sale of residential rental property, the owner of the property shall notify any tenant in writing of the following:
(1) That a foreclosure action or sale of the residential rental property under a trust deed has been commenced against the rental property; and
(2) The date of the sale of the property.
(d) Nothing in this section allows a tenant to withhold his or her rental obligation because of receipt of the required notice.
(f) If the tenant moves as a result of a circumstance that the landlord failed to disclose as required by the provisions of section, the tenant may recover twice the actual damages or twice the monthly rent, whichever is greater, and all prepaid rent, in addition to any other remedy that the law may provide.
CHAPTER 38. LIENS

ARTICLE 1. VENDOR'S AND TRUST DEED LIENS
§38-1-16. Effect of Foreclosure on Preexisting Tenancy.
(a) Notwithstanding the notice provisions of section five, article six, chapter thirty-seven of this code, in the case of any foreclosure on any dwelling or residential real property after the date of enactment of this section, any immediate successor in interest in such property pursuant to the foreclosure shall assume such interest subject to:
(1) the provision, by such successor in interest of a notice to vacate to any bona fide tenant at least ninety days before the effective date of such notice; and
(2) the rights of any bona fide tenant, as of the date of such notice of foreclosure:
(A) under any bona fide lease entered into before the notice of foreclosure to occupy the premises until the end of the remaining term of the lease, except that a successor in interest may terminate a lease effective on the date of sale of the unit to a purchaser who will occupy the unit as a primary residence, subject to the receipt by the tenant of the ninety day notice under subdivision (1); or
(B) without a lease, subject to the receipt by the tenant of the ninety day notice under subdivision (1),
except that nothing under this section shall affect the requirements for termination of any Federal or State subsidized tenancy.
(b) For purposes of this section, a lease or tenancy shall be considered bona fide only if:
(1) the mortgagor or the child, spouse, or parent of the mortgagor under the contract is not the tenant;
(2) the lease or tenancy was the result of an arms-length transaction; and
(3) the lease or tenancy requires the receipt of rent that is not substantially less than fair market rent for the property or the unit's rent is reduced or subsidized due to a Federal or State subsidy.
(c) Nothing in this section shall affect:
(1) The requirements for termination of any Federal or State subsidized tenancy;
(2) Any state law that provides longer periods or other additional protections for tenants; or
(3) A lease or tenancy entered into prior to the execution of a deed of trust that is the subject of a foreclosure.
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