[HISTORY: Adopted by the Mayor and Council of the Borough of Somerdale as indicated in article histories. Amendments noted where applicable.]
Article I Fire Insurance Claims
[Adopted 5-12-1982 by Ord. No. 82:02]
[Amended 9-12-1990 by Ord. No. 90:09]
No insurer issuing fire insurance policies in the State of New Jersey shall pay any claims for fire damages in excess of $2,500 on any real property located within the Borough of Somerdale pursuant to a fire insurance policy issued or renewed after the adoption of this article and the filing of the same with the State Commissioner of Insurance unless or until the insured person submits an official certificate of search for municipal liens pursuant to N.J.S.A. 54:5-12 certifying that all taxes, assessments or other municipal liens or charges levied and assessed and due and payable against said property have been paid either by the assessed owner or insurer and an official certificate of demolition, on the form prescribed and certified by the Borough of Somerdale, that demolition is not required or that the costs of demolition have been paid or the municipality submits a certified copy of a resolution adopted pursuant to § 156-4 of this article. If the demolition has not yet occurred on the date of receipt by the Borough of Somerdale of a request for execution of the official certificate required, the insured shall provide on that official certificate an estimate of the anticipated costs of demolition. The insurer, on notice to the insured, shall pay the anticipated costs of demolition to the Borough of Somerdale, which shall hold the funds in an interest-bearing escrow account in a state or federally chartered bank, savings bank or savings-and-loan association in New Jersey. Any request pursuant to this section for an official certificate of search for municipal liens shall specify that the search concerns fire-damaged property.
The official certificate of search referred to in § 156-1 of this article 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 municipal liens or related charges due and payable subsequent to the preparation of the official certificate.
[Amended 9-12-1990 by Ord. No. 90:09]
Unless a resolution is received in accordance with § 156-4 of this article by an insurance company writing fire insurance policies in the Borough of Somerdale, such insurance company is hereby authorized and required, prior to the payment of any claims for fire damages in excess of $2,500, to pay the amount of the anticipated demolition costs to the municipality in the manner provided by § 156-1 of this article and to pay the municipality the amount of the liens appearing on the official certificate and such other recorded liens or related charges as may be certified to the insurance company.
If an appeal is taken on the amount of any 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 issue a draft payable to the court of record, to be held by the court in an interest-bearing escrow account in a banking institution or savings-and-loan association, in an amount totaling 75% of the full amount of the lien or charge being contested and not to exceed the proceeds payable under its insurance policy, and the insurance company shall issue a draft payable to the municipality for the remaining 25% of the lien or charge being contested, with the full amount paid by the insurance company to the court and the municipality not to exceed the proceeds payable under its insurance policy, 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 and savings-and-loan associations shall be disbursed in accordance with the final order or judgment of the court.
The Borough Council of the Borough of Somerdale may enter into agreement with the owner of any fire-damaged property to pay in full all delinquent taxes, assessments or other municipal liens by installments pursuant to N.J.S.A. 54:5-19 or for the redemption of the tax sale lien by installment payments pursuant to Article 7 of Chapter 5 of Title 54 of the Revised Statutes if the Borough Council is satisfied that the claim for fire damages is to be used to restore and improve the fire-damaged property. An insurance company receiving a certified copy of a resolution of agreement from the Borough Council of the Borough of Somerdale is authorized to make full payment on the same to the insured person.
A municipal claim made in accordance with the provisions of this article shall be paramount to any other claim on the proceeds of a fire insurance policy except the claim of the holder of a purchase money mortgage held as a first mortgage or an institutional lender which is a holder of a mortgage on a fire-damaged property where the fire insurance policy at the time of the loss listed the mortgagee as the holder of an insurable interest, in which event the claim of the mortgagee to the proceeds shall be paramount to the municipal lien under this article only to the extent of the amount due "institutional lender" means any bank, savings bank or state- or federally chartered savings-and-loan association or insurance company.
Nothing in this article shall be construed to:
Obligate an insurance company for any amount in excess of the proceeds payable under its fire insurance policy.
Except as provided in the case of appeals under § 156-3 of this article, obligate the insurance company for any liens not appearing on the official certificate or any certified changes submitted by the bonded official.
Affect the authority of the Borough of Somerdale to enforce a municipal lien under any other law of this state.