[HISTORY: Adopted by the Municipal Council of the Borough
of Hawthorne 5-7-1997 by Ord. No. 1666 (Ch. 104 of the 1989
Code). Amendments noted where applicable.]
GENERAL REFERENCES
Fire Department and fire prevention — See Ch. 25.
Pursuant to the authorization of N.J.S.A. 17:36-8 et seq., there
is hereby adopted an ordinance to ensure the payment of taxes, assessments
or other municipal liens due and payable on real property in the Borough
of Hawthorne when said property is covered by fire insurance in excess
of $2,500 and is damaged or destroyed by fire and to ensure that,
if demolition is required, the costs of demolition have been paid
or escrowed.
This chapter shall apply to any fire insurance policy issued
or renewed after the adoption of this chapter and after the filing
of this chapter with the State Commissioner of Insurance.
A.
The payment to a claimant by any fire insurance company authorized
to issue fire insurance policies in this state of any claim in excess
of $2,500 for fire damages on any real property located within the
Borough of Hawthorne is hereby prohibited until:
(1)
Such time as all taxes and assessments or charges due and payable
appearing on an official certificate of search for Borough liens pursuant
to N.J.S.A. 54:5-12 dated subsequent to the fire shall have been paid
either by the owner of such real property or by the insurance company
pursuant to the provisions of this chapter; or
(2)
The Borough submits to the insurance company a certified copy of a resolution adopted pursuant to the provisions of § 239-5 of this chapter.
(3)
In addition, prior to payment, the insured is required to submit
an official certificate executed by the Borough of Hawthorne that
demolition is not required or the costs of demolition have been paid.
B.
If the demolition has not yet occurred on the date of receipt by
the Borough of a request for execution of the certificate required
by this section, the insured shall provide on that certificate an
estimate of the anticipated costs of demolition. The insurer on notice
to the insured shall then pay the anticipated costs of demolition
to the Borough which shall hold the funds in an interest-bearing escrow
account until the demolition occurs or the actual costs of demolition
are determined and paid.
The official certificate of search may from time to time be
altered by the bonded official responsible for preparing such certificates
in order to correct any errors or omissions or to add any Borough
liens or related charges due and payable subsequent to the preparation
of the official certificate.
If it is satisfied that the claim for fire damages is to be used to restore or improve the fire-damaged property, the governing body of the Borough may submit to the insurance company a certified copy of a resolution by which it has entered into an agreement with the owner of any fire-damaged property to accept payment in full of all delinquent taxes, assessments or other municipal liens or charges in installments pursuant to N.J.S.A. 54:-19 or for redemption of the tax sale lien by installment payments pursuant to Article 7 of Chapter 5 of Title 54 of the Revised Statutes.
Unless a resolution is received in accordance with this chapter
by an insurance company writing fire policies in the Borough of Hawthorne,
such insurance company is hereby authorized and required, prior to
payment of any claims for fire damages in excess of $2,500 to pay
to the Borough of Hawthorne the amount of the liens appearing in the
official certificate, or in any alteration thereof pursuant to this
chapter, and such other recorded liens or related charges as may be
certified to the insurance company; provided, however, that if an
appeal is taken on the amount of the lien or charge, other than an
appeal on the assessed valuation of real property pursuant to N.J.S.A.
54:3-21, the insurance company shall withhold 75% of the full amount
of the lien or charge being contested, pending termination of all
proceedings, at which time such moneys and all interest accruing thereon
at a rate paid on interest-bearing accounts in banking institutions
or savings and loan associations in the state shall be disbursed in
accordance with the final order or judgment of the court.
Except as provided in the case of appeals under this chapter,
nothing in this chapter shall be construed to obligate the insurance
company for any liens not appearing on the official certificate or
in any certified changes therein submitted to the insurance company
by the bonded official.
The Borough's claim made in accordance with the provisions
of this chapter shall be paramount to any other claims on the proceeds
of the fire insurance policy, except the claim of a holder of a mortgage
on the fire-damaged property, where the fire insurance policy at the
time of the loss listed the mortgagee as a named insured, in which
event the claim of the mortgagee to file process shall be paramount
to the municipal lien only to the extent of the amount due and payable
to the mortgagee under the mortgage contract.
Upon its adoption, this chapter and any subsequent amendment
thereof shall be filed with the New Jersey State Commissioner of Insurance
as required by law.