Town of Tuxedo, NY
Orange County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the Town Board of the Town of Tuxedo 5-10-1978 as L.L. No. 1-1978. Amendments noted where applicable.]
GENERAL REFERENCES
Building construction — See Ch. 37.
The Town Board of the Town of Tuxedo, taking cognizance of the exposure to loss, because of a builder's financial failure, of contract deposits placed with a builder for the purchase of a home in the Town of Tuxedo and further taking cognizance of the desire on the part of all responsible businessmen in the building and construction industry in the Town of Tuxedo to preserve their reputations from the adverse effect of possible losses of home buyer deposits as above described, hereby determines that the enactment of this chapter pursuant to the general powers granted by § 10 of the Municipal Home Rule Law will contribute to the public welfare and safety and to the orderly development of the Town of Tuxedo and will reinforce public confidence in the financially responsible builders and contractors in the Town of Tuxedo.
As used in this chapter, the following terms, unless the context requires otherwise, shall have the meanings indicated:
DEFAULT
Where title to the home is not transferred to the vendee because of the failure of the vendor to substantially perform those provisions of the agreement between the vendor and vendee wherein the vendor undertook to build or construct a home for the vendee or where the vendor becomes insolvent.
DEMAND
Communication of an actual notice to the vendor of requests made therein.
DEPOSIT
The ten percent down payment given by the vendee to the vendor as required by the vendor prior to the commencement of the work to be performed, pursuant to an agreement between the vendor and vendee wherein the vendor undertook to build or construct a home for the vendee.
HOME
A new one- or two-family dwelling intended to be used primarily as a residence.
TOWN
The Town of Tuxedo.
VENDEE
Any individual or individuals who have contracted with a vendor for construction of a home on land not owned at the time of such agreement by such individual or individuals.
VENDOR
Any person, firm, corporation or association engaged in the business of erecting or constructing homes.
A. 
Posting bond. When a vendor undertakes to build or construct a home for a vendee and such vendee is required to pay a deposit to such vendor, the vendor shall post with the Supervisor, as chief fiscal officer of the town, a bond in the amount of such deposit or deposits. Such bond shall be posted within five business days after receipt of said deposit by the vendor and shall secure the payment of said deposit to the vendee upon the vendor's default. In no event shall the vendor secure a building permit from the Zoning and Building Inspector until the posting of such bond is completed.
B. 
Alternative to posting bond. In the event that the vendor is unable to post a bond as hereinabove provided, the vendor shall place the deposit or deposits paid to him by the vendee in an interest-bearing escrow account maintained by the vendor's attorney within five business days after receipt of such deposit or deposits. Such deposit or deposits, together with interest accumulated thereon, shall remain the property of the vendee, except as otherwise provided herein. No building permit shall be issued until evidence that the deposit or deposits have been placed in an interest-bearing escrow account has been presented to the Supervisor as chief fiscal officer of the town.
Upon transfer of title of the home to the vendee and upon presentation of evidence that such transfer has occurred, the posted bond or funds held in escrow, together with interest accumulated thereon, shall become the property of the vendor, unless otherwise agreed between the vendor and vendee.
In the event of a default by the vendor, the vendee may demand return of his deposit or deposits from the vendor or his attorney, and the vendor or his attorney shall physically transfer the account to the vendee or pay the balance of said account to the vendee within 14 business days after the day on which the demand was made. If the vendor has posted a bond pursuant to the provisions of this chapter, the vendee may initiate an action for the payment thereon for the amount of the deposit or deposits.
[Amended 10-10-1979 by L.L. No. 7-1979]
Failure of the vendor to comply with any of the provisions of this chapter is a misappropriation of funds, and action may be brought by the vendee against the vendor for the return of any moneys advanced. In addition, the failure of the vendor to so comply with the provisions of this chapter shall be deemed a violation pursuant to the Penal Law of the State of New York, punishable by a fine not exceeding $250 or by imprisonment for not exceeding 15 days, or by both such fine and imprisonment.
A. 
Nothing in this chapter shall impair, limit or reduce the statutory, common law or contractual duties or liability of any vendor in the construction of a home, nor shall these provisions apply to any local law or ordinance which requires the posting of public improvement bonds.
B. 
This chapter is intended to prevent loss of contract deposits on homes being built in the Town of Tuxedo. It shall not be construed to make the town or any agency or department of the town a party to a contract of sale of real property or an arbiter or guarantor of the terms of such a contract.