Revision: Jan. 15, 2019, 3:01 p.m.
HB 599 - AS INTRODUCED
2019 SESSION
19-0646
10/06
HOUSE BILL 599
AN ACT relative to liens for labor and materials on property owned by an irrevocable trust.
SPONSORS: Rep. Williams, Hills. 4
COMMITTEE: Commerce and Consumer Affairs
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ANALYSIS
This bill adds required procedures for liens for labor and materials on property owned by an irrevocable trust.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
19-0646
10/06
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
AN ACT relative to liens for labor and materials on property owned by an irrevocable trust.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Liens For Labor and Materials; Subcontractors. Amend RSA 447:5 to read as follows:
447:5 Subcontractors; Procedure When Owned by Irrevocable Trust.
I. If a person shall perform labor, provide professional design services as defined in RSA 447:2, or furnish materials to the amount of $15 or more for any of the purposes specified in RSA 447:2, 447:3 and 447:4 and in RSA 453, by virtue of a contract with an agent, contractor or subcontractor of the owner, the person shall have the same lien as provided in said sections, provided, that he or she gives notice in writing to the owner or to the person having charge of the property that he or she shall claim such lien before performing the labor or furnishing the material for which it is claimed.
II.(a) Pursuant to RSA 564-B:5-505A, no settlor, as defined in RSA 564-B:1-103(15), of an irrevocable trust may encumber trust property, as defined in RSA 564-B:1-103(11), for an amount greater than the maximum amount that can be distributed to or for the benefit of the settlor. No settlor, without written consent from the trustee of such trust property unless otherwise stipulated in the terms of the trust, may guarantee delivery of contract services, materials, or labor to the benefit of trust property for an amount that is greater than the maximum amount that can be distributed to or for the benefit of the settlor. The settlor or its agent desiring to receive services, materials or labor to benefit property owned by an irrevocable trust shall provide the trustee of such trust an account of the labor to be performed, professional design services provided, or materials to be furnished prior to the execution of any contract engaging any person to provide such services, materials or labor to the benefit of trust property.
(b) Prior to engaging a person to provide services, materials or labor, the settlor or its agent shall notify the person in writing or by posting in a conspicuous place on the jobsite notice satisfactory to the trustee, at a minimum, informs the person that:
(1) The property owner is an irresolvable trust;
(2) The settlor is a beneficiary to the trust;
(3) Neither the trust, the trustees or other trust beneficiaries shall be liable to any agent, contractor, or subcontractor for services, labor or materials provided to or received by a trust settlor or its agent, and;
(4) The name, address and telephone number of the trustee of such trust.
(c) The trustee shall, upon receipt of the accounting from the settlor as set forth in subparagraph (a), seek to retain from the settlor moneys and surety to ensure payment of the proposed labor, services, or materials. The trustee may, but is not obligated to, encumber the interests of the settlor to secure payment prior to the settlor engaging such services, materials, or labor.
(d) Any person entitled to a lien pursuant to RSA 447:2 - RSA 447:7 shall, within 15 business days of the posting required in subparagraph (b), or prior to commencing to furnish services, materials, supplies, or other things, provide written notice to the trustee for the property to which such person is furnishing services, materials, supplies, or other things. The written notice provided under this subparagraph shall include a schedule and costs of services, materials, supplies or other things to be provided, the name of the settlor, and the address of the property. Failure to provide the notice required by this paragraph shall not alone invalidate the lien created by RSA 447:2 - RSA 447:7.
(e) At least 48 hours prior to requesting any requisition for funds, the settlor or his agent shall post in a conspicuous place on the jobsite for which the funds, if any, were secured, the anticipated funding date for said requisition. The trustee shall require a copy of said notice, which shall be certified as to its posting by the settlor or his or her agent prior to disbursing any funds.
(f) In the event that a written contract between the settlor, or his or her agent, and a person furnishing services, materials, supplies, or other things shall provide that the disbursement of funds, a portion of which is intended to pay such person, shall be by a 2-party check, the settlor or his or her agent shall transmit a copy of such agreement to the trustee. Upon receipt of a copy of such written agreement, the trustee shall subsequently disburse funds intended in part to pay any such person only by a check made payable to the settlor or his or her agent and such person. Unless otherwise agreed by the trustee and settlor, disbursements shall be made only for actual work completed and materials consumed on the jobsite for which the funds were secured.
(g) If a settlor, as required in subparagraph (b), fails to notify the trustee or fails to notify any person prior to engaging services, materials or labor, that settlor shall be at fault, personally liable, and subject to RSA 564-B:8–812(d).
(h) If a person having notice, as required in subparagraph (b), fails to notify the trustee prior to the delivery of services, materials or labor to trust property, as required in subparagraph (d), and a pending lien for nonpayment is valid to the extent such moneys are due the person whether contractor, agent, or subcontractor engaged by a settlor to the benefit of trust property, the amount required to satisfy the account shall not be the responsibility of the trust, the trustee, or trust beneficiaries that did not engage the person providing services, materials or labor to trust property. Pursuant to subparagraph (a), the trustee may, but is under no obligation to do so, elect to encumber the specific interests or rights of the settlor responsible for engaging such services, materials or labor until trust disposition.
2 Homestead Right; Managed Asset Trust. Amend RSA 480:1 to read as follows:
480:1 Amount.
I. Every person is entitled to $120,000 worth of his or her homestead, or of his or her interest therein, as a homestead. The homestead right created by this chapter shall exist in manufactured housing, as defined by RSA 674:31, which is owned and occupied as a dwelling by the same person but shall not exist in the land upon which the manufactured housing is situated if that land is not also owned by the owner of the manufactured housing.
II. The homestead right created by this chapter shall exist for a managed asset trust, as defined in RSA 564-B:1-103, if the trust holds legal title to residential real estate occupied as a dwelling by a trust beneficiary, as defined in RSA 564-B:1-103, having an equitable interest in such dwelling, and shall exist in the land upon which the dwelling is situated if the beneficial interest owned by the beneficiary occupying the dwelling includes the land or a right to acquire the land upon which the dwelling is situated.
3 Effective Date. This act shall take effect 60 days after its passage.