Administrative Code

Virginia Administrative Code
10/26/2021

Part VII. Transaction Recovery Fund

Article 8
Reinstatement

13VAC6-20-420. Recovery fund established; assessments.

A. In accordance with § 36-85.31 of the Code of Virginia, the board shall establish a Manufactured Housing Transaction Recovery Fund. Any manufacturer, dealer, broker or salesperson licensed by the board under this chapter to operate in the Commonwealth of Virginia shall pay an initial assessment fee of the following amount into the fund:

1. Manufacturer -- $4,000 for each separate manufacturing facility payable in one installment or $4,400 payable at $2,200 per year with the second payment due one year after initial licensing.

2. Dealer -- $500 per retail location.

3. Broker -- $500 per sales office.

4. Salesperson -- $50 per individual.

B. After the initial assessments have been paid, the board shall review the balance in the fund. In accordance with § 36-85.31 of the Code of Virginia, the minimum balance of the fund shall be $250,000. If the initial assessments fail to achieve this minimum balance, or if future payments from the fund deplete the fund below this minimum balance, the board shall set and collect reassessment fees to achieve and maintain this minimum balance. Before setting any reassessments, the board shall notify all regulants at least 30 days prior to any meeting to set reassessment fees, advising the regulants of the purpose of the meeting and the regulants' opportunity to provide comments and suggestions prior to and at the meeting. Failure to pay any reassessment fees assessed by the board shall result in suspension of the regulant's license until such time as the regulant pays the reassessment fee.

C. All initial assessments and reassessments collected by the board under this chapter shall be deposited in an interest earning, special fund account by the State Treasurer in accordance with § 36-85.31 of the Code of Virginia. The board shall make appropriations from the fund in accordance with the express purposes set forth in Chapter 4.2 (§§ 36-85.16 et seq.) of Title 36 of the Code of Virginia and this chapter. Interest earned on the deposits of the fund shall accrue to the fund or may be used by the board to provide educational programs about manufactured homes to consumers.

Statutory Authority

§ 36-85.18 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.1, eff. April 1, 1994.

13VAC6-20-430. Filing claims; investigations; conference or hearing on claim.

A. Any person who suffers any loss or damage by an act of a regulant that constitutes a violation of this law or this chapter shall have the right to file a claim for recovery from the fund. The department shall provide forms for filing claims. As a minimum, the following information shall be furnished with the claim:

1. The names and addresses of the regulants involved in the claim.

2. The identification of the home including the serial number, HUD label number or numbers, and model designations.

3. A complete explanation of the issues or actions which constitute the basis for the claim, along with copies of pertinent documents.

4. The name, address and telephone number of the claimant and the location of the home if different from the claimant's address.

B. Upon receipt of a claim, the board shall review the claim and may conduct, or cause to be conducted, an on-site inspection of the home. All regulants involved in a claim shall be notified of any on-site inspections by the board or the department under this chapter and shall be requested to have a representative present during the inspection. The person or persons conducting the inspection for the board or the department shall prepare a written report of the findings of the inspection, citing any defects or violations of the Code or this chapter with a reference to the specific section of the Code or regulation which serves as the basis for the violation, and identifying the regulant responsible for the defect or violation. Copies of this report shall be provided to the regulants, the claimant, and the board.

C. The board shall hold a conference or hearing on a claim for damages. The board, or the department acting on the board's behalf, shall send written notice of the conference or hearing to all involved regulants, stating the purpose of the conference or hearing and the time and place of the conference or hearing. The notice shall be sent to the regulant or regulants at least 15 calendar days prior to the date of the conference or hearing. The notice shall be sent by certified mail to the address of the regulant or regulants, as shown on the license or other record or information in possession of the board. The conference or hearing shall be conducted by the board according to the applicable provisions of the Administrative Process Act and shall be open to the public. The regulant or regulants shall have the right to be heard in person or by counsel, and to provide evidence and witnesses on his behalf.

D. After the conference or hearing, if the board finds that the person has suffered a loss or damages due to the acts of a regulant that constitute a violation of this chapter, the board shall determine the amount of damages to be awarded to the claimant. The amount of damages awarded by the board shall be limited to actual compensatory damages and shall not include attorney's fees for representation before the board. The board shall order the responsible manufacturer, dealer, broker, or salesperson to pay the awarded amount to the claimant. The board's written order shall be sent by certified mail to the regulant responsible for paying the awarded amount. Within 30 days of receipt of the board's decision, the responsible regulant shall pay the awarded amount to the claimant, unless an appeal is pending.

Statutory Authority

§ 36-85.18 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.2, eff. April 1, 1994; amended, Virginia Register Volume 12, Issue 3, eff. January 1, 1996.

13VAC6-20-440. Appeals of the board's decision.

Appeals of the decision of the board shall be to a circuit court with jurisdiction in the Commonwealth. The appeal shall be filed by the regulant within 30 days of the date of the board's order, and shall stay the board's order for payment of the awarded amount. Neither the regulant nor the board shall be required to pay damages to the claimant until such time as the final order of the court is issued. In accordance with § 36-85.35 of the Code of Virginia, the court may award reasonable attorney's fees and court costs to be paid by the recovery fund.

Statutory Authority

§ 36-85.18 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.3, eff. April 1, 1994.

13VAC6-20-450. Payment of damages; limitations; conditions.

A. If a regulant has not paid the awarded amount within 30 days as provided in 13VAC6-20-430 or filed an appeal to the circuit court as provided in 13VAC6-20-440, the board shall, upon request of the claimant pay the awarded amount to the claimant from the recovery fund under the following conditions:

1. The maximum claim of one claimant against the fund because of a single or multiple violations by one or more regulants shall be limited to $40,000;

2. The fund balance is sufficient to pay the awarded amount;

3. The claimant has assigned the board all rights and claims against the regulant; and

4. The claimant agrees to subrogate to the board all rights of the claimant to the extent of payment.

B. The aggregate amount of claims paid from the fund for violations by any one regulant during any license period shall be as follows:

1. For a manufacturer -- $75,000.

2. For a dealer -- $35,000.

3. For a broker -- $35,000.

4. For a salesperson -- $25,000.

C. If the board has reason to believe there may be additional claims against the fund from other transactions by the same regulant, the board may withhold any payments, involving that regulant, from the fund for a period of not more than one year from the date the board approved the original claimant's award. After this one-year period, if the aggregate of claims against the same regulant exceeds the limitations of this section, the aggregate amount shall be prorated by the board among the claimants and paid from the fund in proportion to the amounts of their awards remaining unpaid.

D. The amount of damages awarded by the board shall be limited to actual, compensatory damages and shall not include attorney fees for representation before the board.

Statutory Authority

§ 36-85.18 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.4, eff. April 1, 1994; amended, Virginia Register Volume 38, Issue 1, eff. October 15, 2021.

13VAC6-20-460. Revocation of license.

Upon payment to a claimant from the fund, the board shall immediately revoke the license of the regulant whose conduct resulted in the payment from the fund. Any regulant whose license is revoked under this section shall not be eligible to apply for a new license, renewal, or reinstatement of license until he has repaid the fund the full amount of the payments from the fund on his amount, plus interest, calculated at the rate of interest the recovery fund was earning at the time of the payment from the fund.

Statutory Authority

§§ 36-85.18 and 36-85.36 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.5, eff. April 1, 1994; amended, Virginia Register Volume 28, Issue 20, eff. July 4, 2012.

13VAC6-20-470. Other disciplinary action not voided.

The board may take other disciplinary actions against any regulant for any violation of Chapter 4.2 (§§ 36-85.16 et seq.) of Title 36 of the Code of Virginia, or this chapter. Full repayment of the amount paid from the fund for the regulant's actions shall not nullify, modify or prohibit the affect of any disciplinary proceeding by the board against that regulant for any violations.

Statutory Authority

§ 36-85.18 of the Code of Virginia.

Historical Notes

Derived from VR449-01-02 § 7.6, eff. April 1, 1994.

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