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§ 4.5-705. Recovery from Guaranty Fund

West's Annotated Code of MarylandBusiness RegulationEffective: October 1, 2020

West's Annotated Code of Maryland
Business Regulation (Refs & Annos)
Title 4.5. Home Builder Registration (Refs & Annos)
Subtitle 7. Home Builder Guaranty Fund (Refs & Annos)
Effective: October 1, 2020
MD Code, Business Regulation, § 4.5-705
§ 4.5-705. Recovery from Guaranty Fund
(a) Subject to this subtitle a claimant may recover compensation from the Guaranty Fund for an actual loss that results from an act or omission by a registrant as found by the Division or a court of competent jurisdiction.
(b) Before submitting a claim to the Guaranty Fund, a consumer shall:
(1) send a registrant a written notice describing the alleged defect or other claim for which the consumer intends to seek recovery; and
(2) permit the registrant access, during regular business hours, to the consumer's property to inspect, determine the cause of, and remedy the alleged defect or other claim within a reasonable period of time.
(c)(1)(i) If a consumer has a new home warranty security plan, the consumer may also seek recovery from the Guaranty Fund if the consumer has first:
1. filed a claim with the new home warranty security plan; and
2. exhausted the plan's claim process.
(ii) A consumer seeking recovery under subparagraph (i) of this paragraph may not receive more than one recovery for the same actual loss.
(2) A claimant who has also filed a claim with a new home warranty security plan shall include with the claim against the Guaranty Fund:
(i) a copy or description of the claim filed with the new home warranty security plan;
(ii) any documents submitted by the claimant in support of the warranty claim, including engineering or inspection reports;
(iii) any documents submitted on behalf of the home builder or warranty plan in connection with the warranty claim, including engineering or inspection reports;
(iv) disclosure of any recoveries received in connection with the warranty claim; and
(v) if all or part of the warranty claim was denied, a copy of the denial.
(d)(1) The Division may deny a claim if the Division finds that the claimant unreasonably rejected good faith efforts by the registrant to resolve the claim.
(2) In determining whether a claim should be denied under paragraph (1) of this subsection, the Division shall consider whether the claimant provided the registrant with notice and a reasonable opportunity to access and inspect and repair the claimed defect as required under subsection (b) of this section.
(e) The Division may not award from the Guaranty Fund:
(1) more than $50,000 to one claimant for acts or omissions of one registrant;
(2) more than $500,000 to all claimants for acts or omissions of one registrant unless, after the Division has paid out $500,000 on account of acts or omissions of the registrant, the registrant reimburses $500,000 to the Guaranty Fund; or
(3) an amount for attorney's fees, consequential damages, court costs, interest, personal injury damages, or punitive damages.
(f) A claim against the Guaranty Fund based on the act or omission of a particular registrant may not be made by:
(1) a spouse or other immediate relative of the registrant;
(2) an employee or principal of the registrant; or
(3) an immediate relative of an employee or principal of the registrant.
(g)(1) A claimant may bring a claim against the Guaranty Fund within 2 years after the claimant discovered or, should have discovered the loss or damage or within 2 years after the expiration of the warranty under § 10-204 of the Real Property Article, whichever occurs first.
(2) If a claimant has filed a claim with a new home warranty security plan, a claimant may bring a claim against the Guaranty Fund within 4 months after the claims process of the home warranty security plan is exhausted.

Credits

Added by Acts 2008, c. 480, § 1, eff. Oct. 1, 2008; Acts 2008, c. 481, § 1, eff. Oct. 1, 2008. Amended by Acts 2020, c. 58, § 1, eff. Oct. 1, 2020; Acts 2020, c. 59, § 1, eff. Oct. 1, 2020.
MD Code, Business Regulation, § 4.5-705, MD BUS REG § 4.5-705
Current through legislation effective through May 9, 2024, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
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