CHAPTER 14

FORMERLY

HOUSE BILL NO. 14 AS AMENDED BY

HOUSE AMENDMENT NO. 1 AND SENATE AMENDMENTS NOS. 1,4 AND 5

AN ACT TO AMEND TITLE 25 OF THE DELAWARE CODE RELATING TO THE CONVERSION OF ANY MOBILE HOME PROPERTIES INTO MULTIPLE-UNIT HOUSING.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:

Section 1. Amend Title 25 of the Delaware Code by adding thereto a new Part IV, which new Part shall Include present Chapter 70, together with a new Chapter 71, as set forth in this Act. The Title of new Part IV shall be:

"PART IV. MOBILE HOMES AND MOBILE HOME PARKS"

Section 2. Amend Part IV, Title 25 of the Delaware Code by adding thereto a new chapter, designated as Chapter 71, which new chapter shall read as follows:

"CHAPTER 71. CONVERSION OF MOBILE HOME PROPERTIES §7101. Statement of Purpose

This chapter is designed to protect and enhance the welfare of the citizens of Delaware by preserving the availability of mobile home rental units. An emergency situation exists with respect to housing for Delaware citizens, many of them elderly, in mobile home parks intending to convert into multiple-unit usage. This chapter provides a procedure for the orderly transition of a mobile home park from single unit rentals to multi-unit usage. Without the procedure established herein, tenants of mobile home parks may be deprived of any suitable areas in which to live.

§7102. Definitions

The following words, terms and phrases, when used in this Chapter, shall have the meanings ascribed to them in this Section, except where the context clearly indicates a different meaning;

(a) 'Affected local community' shall mean the municipality or county in which the largest portion of the real property which has been proposed as a conversion project is situated. An 'affected local government' shall mean the elected council or other governing body of an affected local community.

(b) 'Comparable housing' shall mean a dwelling place or mobile home park site which is: (I) Decent, safe, sanitary, and in compliance with all local and state housing codes;

(2) Open to all persons regardless of race, creed, national orgin, ancestry, marital status or sex;

(3) Provided with facilities equivalent to that provided by the owner in the mobile home park site which is undergoing conversion, and is equivalent to such mobile home park in each of the following categories:

(i) apartment size or mobile home size, or park rental space which can accommodate a mobile home equal in size to that in which the displaced resident was formerly residing (including substantially equivalent yard space and automobile parking space);

(II) rent range;

(111) special facilities necessary for a handicapped or infirm person if the displaced resident is handicapped or infirm;

(4) Located in an area not less desirable than that of the mobile home park being converted, in regard to each of the following:

(i) accessibility to the tenant's place of employment;

(ii) accessibility of community and commercial facilities; OH) environmental quality and conditions; and

(5) In accordance with additional reasonable criteria which the tenant has requested in writing at the time of making any requests under this chapter, as determined by the Attorney General.

(c) 'Conversion project' shall mean the area which comprises or formerly comprised a mobile home park which has been converted to, or which will be converted to or include a condominium, cooperative or other form of multiple-unit housing (and which includes peripheral areas used for landscaping or recreation).

(d) 'Long-term vacancies' shall mean dwelling units in the mobile home park which were not leased, or not occupied by bona fide tenants for more than five months prior to the Preliminary Notice.

(e) 'Mobile home park' shall mean any mobile home or trailer park designed to house mobile homes which are served by utilities on a year-round basis. This chapter shall not apply to a park or camp devoted to recreational vehicles which move to the site under their own power or can be towed to the site by an automobile.

(f) 'Multiple-unit housing' or 'multiple-unit usage' shall include condominiums and cooperatives, but shall not include any type of housing (excluding condominiums or cooperatives) which is not usually purchased and owned on a single unit basis.

(g) 'Non-purchasing tenant' shall mean a tenant who has elected not to purchase a unit or units in the proposed conversion project. A "purchasing tenant" shall mean a tenant who has agreed to purchase a unit or units in the proposed conversion project.

(h) 'Owner' shall mean the legal entity (including a natural person or group of persons) which owns the real estate on which a mobile home is located. The word 'owners' refers to instances where a mobile home park is located on two or more separate parcels where the owners, or the legal status or character of the owners, differs. The word 'owner' shall also include 'owners' unless the context indicates otherwise, and shall include any developer or other person acting in concert with, or with the consent of the owner.

(I) 'Re-location assistance plan' shall mean a proposed plan of assistance to tenants which is intended to enable such tenants to obtain comparable housing with a minimum of difficulty and expense.

(k) Tenant' shall mean a person, eighteen years of age or older, who has at least a leasehold interest in a mobile home park and who, for rent or by written or oral contract or other good consideration is leasing, or is purchasing or has purchased a mobile home or mobile home site within the park. For purposes of §7103 (c) and §7105 a tenant shall mean an individual who rents a mobile home site, or the head of household where a family rents a site. An owner of a mobile home park owning mobile homes or sites within the park is not a 'tenant' under the provisions of this Chapter.

(1) 'Tenant Association' or Tenants' Association' shall mean a group of tenants comprising at least half of those tenants residing within a mobile home park.

§7103. Conversion of Mobile Home Properties

(a) The conversion to multiple-unit usage of any real property on which a mobile home park is situated shall be permitted only where the vacancy rate of mobile home sites in the affected local community constitutes five percent (5%) or more of all mobile home sites available; or the ratio of multiple-unit mobile home housing is twenty-five percent (25%) or less of all mobile home sites available in the affected community all as established according to the records of the appropriate municipal Board of Assessment and Planning and Zoning Commission or County Board of Assessment and Planning and Zonimg Commission, as the case may be.

(b) No real property on which a mobile home is located shall be converted into multiple-unit usage unless at least thirty-five percent (35%) of the tenants at the date the conversion plan is filed with the Recorder of Deeds have agreed to the proposed conversion; provided however, that in the event of any vote or tally, there shall be only one vote for each mobile home site.

(c) No real property on which a mobile home park is located shall be converted into multiple-unit wage if the rent for any tenant has been raised during the six-month period immediately prior to the Preliminary Notice.

§7104. Conversion Plan

Where real property is being utilized as a mobile park, such real property cannot be converted to multiple-unit usage until the owner of such property has filed a true copy of the conversion plan with the Attorney General; with the Office of the Recorder of Deeds of the county or counties in which the land is situated; and has mailed or delivered a copy to the tenant's association, if one is in existence within the mobile home park at that time. The conversion plan shall contain:

(a) Information for the affected local government including, but not limited to, the following:

(1) A description of the boundaries of the real estate which is to be converted;

(2) The name and business address of each corporate and non-corporate developer and owner of the property;

(3) Where a developer or owner is a corporation, the name and address of each officer and member of the corporation's Board of Directors;

(4) A listing of all stages of the proposed conversion process, including the proposed finishing date for each stage;

(5) The developer's assessment of the impact of the proposed conversion on: the immediate surrounding area; local schools; traffic patterns and density; on-street parking; and on utilities and services furnished by the municipality or county.

(6) The developer's assessment of the impact of the conversion on the number of available mobile home rental spaces in the affected local community.

(b) Information needed by present lessees and others who must make a decision concerning whether or not to purchase units in the conversion project, including but not limited to:

(1) A description of the rental structure and of each type of unit in the proposed conversion project, together with the specific initial fixed price for each unit, Including any proposed fees or charges, and how such price was computed and in conjunction with the tenants' association right of first refusal described in S7105 (a)(2) and §7108(a) an explanation as to how the specific fixed price for the entire park was calculated explaining in detail the profit to be made by the owner.

(1) Information in summary form relating to mortgage financing; estiminated down-payment for each unit; alternative financing and down-payments; monthly payments of principal, interest and real estate taxes; and estimated federal income tax benefits and liabilities;

(2) Site plans, including drawings of the property as it would appear after conversion into multiple-unit housing;

(3) A copy of each organizational document, including all proposed covenants, conditions and restrictions;

(4) The number and location of any proposed off-street parking spaces, enclosed storage spaces, and recreational areas;

(5) The extent to which the developer will provide any capital contribution for the maintenance or improvement of common areas;

(6) Statement by the owner that he has received a certificate attesting that the proposed conversion project meets all zoning codes of the county and municipality in which the project will be located, or the conversion project is a valid pre-existing non-conforming use.

(c) Information relating to non-purchasing tenants including, but not limited to, a proposed re-location assistance plan; and a list of comparable housing in the area, including available mobile home and non-mobile home housing. The re-location plan shall include information relating to all agencies and organizations which provide alternative housing re-location assistance.

(d) A listing of all tenants of the mobile home park at the time of the conversion plan, by name; and a listing of those tenants which have agreed to purchase units in the conversion project, together with the signatures of the purchasing tenants.

§7105. Notice

(a) Preliminary Notice Period.

Any owner of real estate on which a mobile home park is located who wishes to convert such property to multiple-unit usage shall provide a written Preliminary Notice to each tenant, and to the tenants' association, if one is in existence, of the owner's intention to convert the property. The Preliminary Notice shall not constitute, nor shall it include, a notice to tenant to terminate his tenancy. Such Preliminary Notice shall also notify each tenant of the following; association the exclusive option to purchase the park for a period of 90 days at the price set forth in the plan. If the tenants' association should exercise its option, it shall hove 120 days from the date of its exercise of its option to complete the purchase. If the tenants' association decides not to exercise its options, upon the expiration of the 90 day period, the option shall convert into a right of first refusal meaning that the property shall not be sold to any other purchaser, at any time, at any price or terms, without first having been offered on the same terms to the tenants' association.

(b) Should the tenants' association fail to exercise its option to purchase within the 90 day period, the owner shall grant to the tenant the exclusive option to purchase the unit for a period of 90 days thereafter at the price set forth in the plan. Upon the request of a tenant, the owner shall provide the tenont with a listing of the types of units within the conversion project, and the price for each type of unit. If the tenant should exercise his option, he shall have 120 days from the date of the exercise of his option to complete the purchase. If the tenant decides not to exercise his option, upon the expiration of the 90 day period, the option shall convert into a right of first refusal, meaning that the property shall not be sold to any other purchaser at any time, at any price or terms without first having been offered on the same terms to the tenant.

(c) For o period of sixty days after a purchasing tenant has agreed in writing to purchase a unit within the conversion project, such tenant shall hove the right to rescind such contract without the imposition of ony penalty or fee. If the tenant rescinds, ony re-negotiation or new agreement signed by the owner and the purchasing tenont shall be valid and binding, If such re-negotiation occurs between the time of recission and the expiration of the sixty-day period set forth in this subsection.

(d) Where the three-year grace period hos expired and o non-purchasing tenant with children still attending school has failed to move, such tenont shall be permitted to remain until one week following the end of the school year; or If any of the children is about to graduate, one week after the graduation ceremony; whichever is later.

§7109. Non-purchasing Tenants

(o) All mobile home sites occupied by non-purchasing tenonts shall be managed by the some manager or ogent who manages all other units in the mobile home park. The owner shall provide to non-purchasing tenants all services and facilities required by law on o non-discriminatory basis. The owner shall guarantee such obligation of the manager or ogent to provide all such services and facilities for each tenont until such time as the tenont no longer resides on the premises. This obligation will be the obligation of the tenonts' association if It exercises its right of first refusal and purchases the park.

(b) Where an owner hos given notice of his intent to convert a mobile home pork, each tenont who has not purchased a unit in the proposed conversion project shall, during the remaining term of the rental agreement and ony extension thereof, be entitled to the same rights, privileges and services thot were enjoyed by tenants prior to the date of the Preliminary Notice together with those that ore granted, offered or provided to purchasers or prospective purchasers of the conversion project.

§7110. Tenant Protection

(a) After the filing of a conversion plan, during the grace period, no owner may evict or fall to renew the lease of 8 tenont of a mobile home park which is the site of a proposed conversion; provided however, thot eviction proceedings may be commenced for non-payment of rent or a Minnier breach by o tenont of a contractual obligation to the owner.

(h) The prices, terms and conditions offered to tenonts by the owner for the purchase of a unit within the conversion project shall be the same as, or more favorable than, those set forth in the conversion plan and those offered to the general public.

(a) Any tenont who hos left the mobile home park or is about to do so because the owner or his agents are substantially interferring with his comfort, peace or quiet contrary to the terms of this chapter may apply to the Attorney General for assistance. The Attorney General may act on such tenant's behalf to secure restraining actions to abate the disturbance and/or to prohibit the owner from engaging in any course of conduct (including but not limited to, interruption or discontinuance of essential services) which would substantially interfere with such person's tenancy.

(a) Where the lease of a tenant expires after the conversion plan hos been filed, and such tenont continues to rent a site within the mobile home park, the owner shall not increase the rent on an annual basis more than the average or the prior year's annual increase In rent of the three geographically nearest mobile home parks in the county in which the park is located. The overage Increase In rent will be determined as of the date on which the lease expires. There shall be no more than one rent increase imposed upon the tenant during any one calendar year.

§711 1. Ilandicapped and Elderly Tenants

In addition to the protection provided to tenants under the provisions of this Chapter, the following provisions shall apply on behalf of any tenant who is handicapped, or who is sixty-five years of age or older:

(1) That there is a mandatory three-year grace period prior to eviction;

(2) That the tenants' association has the exclusive option to purchase that portion of the park which the owner proposes to convert, and must, within ninety days from the date it receives the preliminary notice, and the separate writing described in §7108(a), notify the owner of its intent to exercise its option.

(3) That if the tenants, association decides not to exercise its option, upon the expiration of the 90 day period, the option shall convert into a right of first refusal meaning that the property shall not be sold to any other purchaser, at any time, at any price or terms without first having been offered on the same terms to the tenants' association.

(4) That no tenant shall be evicted prior to the expiration of the three-year grace period, except for the following causes:

(I) Non-payment of rent, or

(ii) Violation of a material provision of the lease.

(b) Grace period.

After the expiration of ninety days from the date of the Preliminary Notice or filing of the conversion plan with the Recorder of Deeds, whichever is later, the owner may give Final Notice to each tenant that the tenant must vacate the premises at the end of the three-year period, unless the tenant comes within any of the exceptions set forth in this section and §7111. From the time of the delivery of the Final Notice, each tenant shall have a three-year grace period before the owner may institute legal action for eviction. In any instance where a tenant's lease is for a period of time which extends beyond the expiration date, as set forth in the Final Notice, the grace period shall continue until expiration of such tenant's lease.

(c) Final Notice.

The Final Notice shall contain a provision stating that each tenant in occupancy at the time of the preliminary notice shall have the exclusive right to purchase a unit in the proposed conversion project, and that such exclusive right to purchase shall continue through the first ninety days after the waiver or termination by the tenants' association of its option, and for such additional time thereafter as the owner shall permit. A copy of the Final Notice shall also be mailed or delivered to the tenants' association, if such association was in being at the time of the Preliminary Notice. The Final Notice shall contain a provision that any person who is a tenant of the mobile home park, and who elects to purchase a unit in the conversion project, shall not be required to pay more for any unit than the price set forth in the conversion plan, nor more than any other person purchasing the same type of unit. The Final Notice shall not constitute, nor shall it include, a notice to the tenant to immediately terminate his tenancy.

§7108. Approval by the Attorney General

No conversion of real property on which a mobile home park is situated shall be lawful unless such conversion has received the approval of the Attorney General after n thorough review the conversion plan to determine compliance with the provisions of this Chapter. Where the Attorney General has not acted to approve, conditionally approve, or disapprove a conversion plan or prospective conversion within ninety days after receipt of the conversion plan, the conversion plan or prospective conversion shall be deemed to have been approved; provided however, that the provisions of §7103 are mandatory, and cannot be waived. The Attorney General may, by a writing addressed to the owner, suspend his decision for an additional thirty days. When the Conversion plan is approved, no provision of the plan shall be changed without the written approval of the Attorney General.

§7107. Leases

(a) Any tenant at the time of the preliminary notice grace period shalt be entitled to have his lease extended, on the same terms and conditions as the immediately preceding lease, until the expiration of the grace period. Nothing in this subsection shall prevent the owner from increasing rent pursuant to §7110 (d) of this chapter.

(b) After receipt of the Final Notice, and upon thirty days' written notice to the owner, a tenant may without penalty terminate his existing lease; provided however, that the owner shall receive a full months' rent for any partial month of tenancy.

§7108. Option to Purchase and Right of Refusal

(a) Where there is a tenants' association in existence at the time of the preliminary notice, the owners of the real property which is to be converted shall in a separate writing mailed to the association, upon approval of the plan by the Office of the Attorney General, grant to the The owner shall supply a list of at least three comparable rental units including mobile home parks, which have vacancies and which can accommodate such person if such exists, subject, however, to the terms of §7112(c) of this Chapter.

(a) The owner shall supply the address and telephone number of the nearest municipal, State or federal agency which can provide information and assistance to such tenant under the National Housing Act and the Uniform Relocation Assistance Act;

(b) Where the tenant remains on the premises at the expiration of the three-year period, and has in good faith attempted to obtain adequate housing; such tenant shall be permitted to stay on the premises until permanent housing is obtained. Any increase in rent shall be in conformity with the terms of §7110(d).

§7112. Eviction

(a) Where, at the conclusion of the grace period a tenant is evicted by order of Court solely as a result of the conversion, the owner shall pay for all expenses incurred by such tenant in moving into his new residence. If the new residence is in a mobile home park, such expenses shall include all "setting up" expenses, including connections to all utilities.

(b) Within 18 full months after receiving final Notice any tenant may request that the owner provide a list of available comparable housing, or comparable mobile home sites and a reasonable opportunity to examine and rent such comparable housing or mobile home site.

(c) After the expiration of the three-year period, the owner may institute an action in the Superior Court for the eviction of any tenant or tenants who still have mobile homes within the park or who otherwise have continued to reside within the park; or a tenant, group of tenants, or tenant association may apply to the Superior Court for a stay of any eviction proceedings. The Court may, in its discretion, authorize one-year stays of eviction subject to such rent increases as authorized by §7110(d) until such time as the Court is satisfied that the tenant has been provided a list of comparable housing or comparable mobile home sites and is satisfied that the tenant has been provided a reasonable opportunity to examine and rent such housing or mobile home site. Except where the owner has failed to provide such a list of comparable housing or mobile home sites, or has failed to provide a reasonable opportunity to examine and rent such housing or mobile home site. Except where the owner has failed to provide such comparable housing or mobile home site, or has failed to offer a reasonable opportunity to examine and rent such housing or mobile home site, the Court shall grant not more than five such eviction stays.

§7113. Penalties

(a) Civil Penalties.

(I) Where an owner violates a provision of §7105 any action taken by the owner to convert the real property on which a mobile home park is located into multiple-unit usage shall be invalid; provided however, that the owner, by again giving the Preliminary Notice required under §7105 may again begin the conversion process.

(2) Where the owner fails to give the tenants' association its option to purchase under §7108, no subsequent sale or purchase of the real property or of any unit within the conversion project shall be valid. Where the owner fails to provide a tenant with an opportunity to purchase under §7108, the tenant shall nevertheless be offered a unit In preference to any non-tenant who has agreed to purchase a unit during or subsequent to the time of the tenant's right to purchase.

(3) Any binding agreement entered into by an owner which results in a violation of any provision of this chapter is:

(I) void, if a person residing In the mobile home park at the time of the Preliminary Notice was an object of, or was adversely affected by such violation; or

(II) voidable at the option of any party thereto. (b) Criminal Penalties.

(I) Any person who Is convicted of a violation of a provision of this Chapter shall be fined u sum not less than one hundred dollars ($100) nor more than five hundred dollars ($500) for each offense. Where the violation is on-going and continuous, each day's continuation of such violation shall constitute a separate offense. The Superior Court shall have jurisdiction over all offenses under this section.

§7114. Modification or Waiver of Chapter Provisions

(a) Except as otherwise provided in this section, any provision in a lease or other agreement which waives or modifies any provision of this Chapter shall be void and unenforceable as against public policy.

An owner and tenant may, however, agree to a modification or waiver of some or all of the

protections afforded to the tenant pursuant to the provisions of this Chapter; provided however:

(1) The modification or waiver is encompassed in a written contact which is separate from the lease;

(2) The modification or waiver is voluntarily entered into without duress;

(3) The modification or waiver is entered into with full understanding of the provisions of this Chapter, the terms of any contract to which the modification or waiver applies, and the modification or waiver itself;

(4) The modification or waiver is for adequate consideration.

(b) In any action involving a modification or waiver, the owner shall have the burden of proof to establish that the requirements of this Chapter and of this Section have been met."

Section 3. No right granted under a conversion plan to either purchasing tenants or non-purchasing tenants shall be abrogated or reduced, even if this Act is amended or expires.

Section 4. If any provision of this Act or the application thereof to any person or circumstances shall be held to be invalid, such holding shall not affect, impair nor invalidate the remainder of this Act or the application of such portion held invalid to any other person or circumstances, but shall be confined in its operation to the provision directly involved in such holding or to the person or circumstance therein involved.

Section 5. This Act shall have no application to the original development of a mobile home park as a condominium, co-operative, or other form of multiple-unit housing, which is commenced with multiple unit usage and for which no more than 5 simultaneous or nearly simultaneous oral or written mobile home or trailer lot leases have ever been entered into between any owner and any tenant prior to its development for multiple unit usage.

Approved March 21, 1983.