Bill Text: IA HF475 | 2023-2024 | 90th General Assembly | Enrolled
Bill Title: A bill for an act relating to unfair residential real estate service agreements, providing penalties, and making penalties applicable. (Formerly HSB 175.) Effective date: 07/01/2023.
Spectrum: Committee Bill
Status: (Passed) 2023-05-12 - Fiscal note. [HF475 Detail]
Download: Iowa-2023-HF475-Enrolled.html
House
File
475
-
Enrolled
House
File
475
AN
ACT
RELATING
TO
UNFAIR
RESIDENTIAL
REAL
ESTATE
SERVICE
AGREEMENTS,
PROVIDING
PENALTIES,
AND
MAKING
PENALTIES
APPLICABLE.
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
Section
1.
NEW
SECTION
.
558B.1
Definitions.
As
used
in
this
chapter,
unless
the
context
otherwise
requires:
1.
a.
“Common
interest
community”
means
real
estate
described
in
a
declaration
with
respect
to
which
a
person,
by
virtue
of
the
person’s
ownership
of
a
unit,
is
obligated
to
pay
for
a
share
of
real
estate
taxes,
insurance
premiums,
maintenance,
or
improvement
of,
or
services
or
other
expenses
related
to,
common
elements,
other
units,
or
other
real
estate
described
in
the
declaration.
“Common
interest
community”
includes
a
planned
community,
a
cooperative
under
chapter
499A,
and
a
horizontal
property
regime
under
chapter
499B.
b.
“Common
interest
community”
does
not
include
any
of
the
following:
(1)
A
covenant
that
requires
the
owners
of
separate
parcels
of
real
estate
to
share
costs
or
other
obligations
related
to
a
wall,
driveway,
well,
or
other
similar
structure,
unless
all
such
owners
consent
in
writing
to
the
creation
of
a
common
interest
community.
(2)
Real
estate
described
in
paragraph
“a”
if
all
units
are
owned
by
a
single
owner.
House
File
475,
p.
2
2.
“Consumer”
means
a
natural
person
being
provided
a
service
under
a
service
agreement,
or
the
natural
person’s
legal
representative.
3.
“Record”
means
presentation
of
a
document
to
a
county
recorder
in
this
state
for
official
placement
in
the
public
land
records.
4.
“Residential
real
estate”
means
real
property
located
in
this
state
which
is
used
primarily
for
personal,
family,
or
household
purposes
and
is
improved
by
one
to
four
dwelling
units.
5.
“Service
agreement”
means
a
contract
under
which
a
person
agrees
to
provide
a
service
in
connection
with
the
maintenance
of,
the
purchase
of,
or
the
sale
of,
residential
real
estate.
Sec.
2.
NEW
SECTION
.
558B.2
Unfair
service
agreements
——
penalties.
1.
A
service
agreement
shall
be
considered
unfair
under
this
section
if
a
service
that
is
covered
by
the
service
agreement
is
not
required
to
be
completely
performed
within
one
year
after
the
date
on
which
the
service
agreement
is
executed,
and
the
service
agreement
has
any
of
the
following
characteristics:
a.
The
service
agreement
purports
to
run
with
the
land
or
to
be
binding
on
future
owners
of
interests
in
the
residential
real
estate
that
is
the
subject
of
the
service
agreement.
b.
The
service
agreement
permits
assignment
of
the
right
to
provide
service
under
the
service
agreement
without
requiring
notice
to,
and
the
consent
of,
the
owner
of
the
residential
real
estate
that
is
the
subject
of
the
service
agreement.
c.
The
service
agreement
purports
to
create
a
lien,
encumbrance,
or
other
real
property
security
interest
on
the
residential
real
estate
that
is
the
subject
of
the
service
agreement.
2.
If
a
service
agreement
is
unfair
under
this
section,
the
service
agreement
shall
be
unenforceable.
3.
If
a
person
enters
into
an
unfair
service
agreement
with
a
consumer,
the
person
commits
an
unlawful
practice
under
section
714.16.
4.
a.
A
person
shall
not
cause
an
unfair
service
agreement,
or
a
notice
or
memorandum
of
an
unfair
service
agreement,
to
be
recorded.
House
File
475,
p.
3
b.
A
person
who
causes
an
unfair
service
agreement,
or
a
notice
or
memorandum
of
an
unfair
service
agreement,
to
be
recorded
commits
an
aggravated
misdemeanor.
c.
A
county
recorder
may
refuse
to
record
an
unfair
service
agreement.
d.
If
an
unfair
service
agreement
is
recorded,
the
recorded
service
agreement
shall
not
provide
actual
or
constructive
notice
against
an
otherwise
bona
fide
purchaser
or
creditor,
or
actual
or
constructive
notice
against
heirs
or
other
successors-in-interest
to
the
residential
real
estate
that
is
the
subject
of
the
recorded
service
agreement.
e.
If
an
unfair
service
agreement
or
a
notice
or
memorandum
of
an
unfair
service
agreement
is
recorded,
any
person
with
an
interest
in
the
residential
real
estate
that
is
the
subject
of
the
service
agreement
may
apply
to
a
district
court
in
the
county
in
which
the
service
agreement
is
recorded
for
a
court
order
declaring
the
service
agreement
unenforceable.
f.
If
an
unfair
service
agreement
or
a
notice
or
memorandum
of
an
unfair
service
agreement
is
recorded,
any
person
with
an
interest
in
the
residential
real
estate
that
is
the
subject
of
the
recorded
service
agreement
may
recover
actual
damages,
costs,
and
attorney
fees
as
may
be
proven
against
the
person
who
caused
the
unfair
service
agreement
or
the
notice
or
memorandum
of
the
unfair
service
agreement
to
be
recorded.
5.
This
section
does
not
apply
to
any
of
the
following:
a.
A
home
warranty
or
similar
agreement
that
covers
the
cost
of
maintenance
for
a
fixed
period
of
time
of
a
major
home
system
including
but
not
limited
to
plumbing,
electrical,
heating,
ventilation,
or
air
conditioning.
b.
An
insurance
contract.
c.
An
option
or
a
right
of
refusal
to
purchase
residential
real
estate.
d.
A
maintenance
or
repair
agreement
entered
into
by
the
homeowners’
association
of
a
common
interest
community.
e.
A
mortgage
loan,
or
a
commitment
to
make
or
to
receive
a
mortgage
loan.
f.
A
security
agreement
under
the
uniform
commercial
code
related
to
the
sale
or
rental
of
personal
property
or
fixtures.
House
File
475,
p.
4
g.
Water,
sewer,
electrical,
telephone,
cable,
internet,
or
any
other
utility
service
providers.
6.
This
section
shall
not
be
construed
to
impair
a
person’s
rights
established
by
a
mechanics’
lien
under
chapter
572.
Sec.
3.
Section
714.16,
subsection
2,
Code
2023,
is
amended
by
adding
the
following
new
paragraph:
NEW
PARAGRAPH
.
q.
It
shall
be
an
unlawful
practice
for
a
person
to
violate
section
558B.2,
subsection
3.
______________________________
PAT
GRASSLEY
Speaker
of
the
House
______________________________
AMY
SINCLAIR
President
of
the
Senate
I
hereby
certify
that
this
bill
originated
in
the
House
and
is
known
as
House
File
475,
Ninetieth
General
Assembly.
______________________________
MEGHAN
NELSON
Chief
Clerk
of
the
House
Approved
_______________,
2023
______________________________
KIM
REYNOLDS
Governor
