HF 638 (LSB 1901HV (4) 88)

HOUSE FILE 638

BY  COMMITTEE ON JUDICIARY

(SUCCESSOR TO HSB 116)

A BILL FOR

An Act relating to landlord remedies and procedures relating to failure to timely pay rent, abandonment, and forcible entry and detainer.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 555B.3, Code 2019, is amended to read as follows:
   555B.3  Action for abandonment —— jurisdiction.
   A real property owner not requesting notification by the sheriff as provided in section 555B.2 may bring an action alleging abandonment in the court within the county where the real property is located provided that there is no lien on the mobile home or personal property other than a tax lien pursuant to chapter 435. The action shall be tried as an equitable action. Unless commenced as a small claim, the petition shall be presented to a district judge. Upon receipt of the petition, either the court or the clerk of the district court shall set a date for a hearing not later than fourteen days from the date of the receipt of the petition, except when there is a lien on the mobile home or personal property, other than a tax lien, the court or the clerk of the district court shall set a date for a hearing no sooner than twenty-five days from the date of the receipt of the petition so as to allow for service on the lienholder.
    Sec. 2.  Section 555B.4, Code 2019, is amended by adding the following new subsection:
   NEW SUBSECTION.  4.  If a lien, other than a tax lien, exists on the mobile home or personal property at the time an action for abandonment is initiated, personal service pursuant to rule of civil procedure 1.305 shall be made upon the lienholder no less than twenty days before the hearing. The notice to the lienholder shall describe the mobile home and shall state the docket, case number, date, time at which the hearing is scheduled, and the lienholder’s right to assert a claim to the mobile home at the hearing. The notice shall also state that failure to assert a claim to the mobile home within the judicial proceedings is deemed a waiver of all right, title, claim, and interest in the mobile home and is deemed consent to the sale or disposal of the mobile home. If personal service upon the lienholder cannot be completed in time to give the lienholder the minimum notice required by this section, the court may set a new hearing date.
    Sec. 3.  Section 555B.8, subsections 2 and 3, Code 2019, are amended to read as follows:
   2.  If Except as otherwise ordered by the court, if the mobile home owner or other claimant asserts a claim to the property, the judgment shall be satisfied before the mobile home owner or other claimant may take possession of the mobile home or personal property.
   3.  If no claim is asserted to the mobile home or personal property or if the judgment is not satisfied at the time of entry, an order shall be entered allowing the real property owner to sell or otherwise dispose of the mobile home and personal property pursuant to section 555B.9. If Except as otherwise ordered by the court, if a claimant satisfies the judgment at the time of entry, the court shall enter an order permitting and directing the claimant to remove the mobile home or personal property from its location within a reasonable time to be fixed by the court. The court shall also determine the amount of further rent or storage charges to be paid by the claimant to the real property owner at the time of removal.
    Sec. 4.  Section 555B.9, subsections 1, 2, 3, and 4, Code 2019, are amended to read as follows:
   1.  Pursuant to an order for disposal under section 555B.8, subsection 3, the real property owner shall dispose of the mobile home and personal property by public or private sale in a commercially reasonable manner. If the personal property, lienholder, owner or other claimant has asserted a claim to the mobile home or personal property within the judicial proceedings, that person shall be notified of the sale by restricted certified mail not less than five days before the sale. The notice is deemed given upon the mailing. The real property owner may buy at any public sale, and if the mobile home or personal property is of a type customarily sold in a recognized market or is the subject of widely distributed standard price quotations, the real property owner may buy at a private sale.
   2.  A sale pursuant to subsection 1 transfers to the purchaser for value, all of the mobile home owner’s rights in the mobile home and personal property, and discharges the real property owner’s interest in the mobile home and personal property, and any tax lien, and any other lien. The purchaser takes free of all rights and interests even though the real property owner fails to comply with the requirements of this chapter or of any judicial proceedings, if the purchaser acts in good faith.
   3.  The proceeds of the sale of mobile home and personal property shall be distributed as follows:
   a.  First, to satisfy the real property owner’s judgment obtained under section 555B.8.
   b.  Second, to satisfy any tax lien for which a claim was asserted pursuant to section 555B.4, subsection 3.
   c.  Third, to satisfy any other lien for which a claim was asserted pursuant to section 555B.4, subsection 4.
   c.  d.  Any surplus remaining after the proceeds are distributed shall be held by the real property owner for six months. If the mobile home owner fails to claim the surplus in that time, the surplus may be retained by the real property owner. If a deficiency remains after distribution of the proceeds, the mobile home owner is liable for the amount of the deficiency.
   4.  Notwithstanding subsections 1 through 3, the real property owner may propose to retain the mobile home and personal property in satisfaction of the judgment obtained pursuant to section 555B.8. Written notice of the proposal shall be sent to the mobile home owner, lienholder, or other claimant, if that person has asserted a claim to the mobile home or personal property in the judicial proceedings. If the real property owner receives objection in writing from the mobile home owner, lienholder, or other claimant within twenty-one days after the notice was sent, the real property owner shall dispose of the mobile home and personal property pursuant to subsection 1. If no written objection is received by the real property owner within twenty-one days after the notice was sent, the mobile home and personal property may be retained. Retention of the mobile home and personal property discharges the judgment of the real property owner, and any tax lien, and any other lien.
    Sec. 5.  Section 562A.9, subsection 4, Code 2019, is amended to read as follows:
   4.  For rental agreements in which the rent does not exceed seven hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds twelve dollars per day or a total amount of sixty dollars per month. For rental agreements in which the rent is greater than seven hundred dollars per month but less than one thousand four hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds twenty dollars per day or a total amount of one hundred dollars per month.  For rental agreements in which the rent is at least one thousand four hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds two percent of the rent per day or a total amount of ten percent of the rent per month.
    Sec. 6.  Section 562B.10, subsections 4 and 7, Code 2019, are amended to read as follows:
   4.  For rental agreements in which the rent does not exceed seven hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds twelve dollars per day or a total amount of sixty dollars per month. For rental agreements in which the rent is greater than seven hundred dollars per month but less than one thousand four hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds twenty dollars per day or a total amount of one hundred dollars per month.  For rental agreements in which the rent is at least one thousand four hundred dollars per month, a rental agreement shall not provide for a late fee that exceeds two percent of the rent per day or a total amount of ten percent of the rent per month.
   7.  a.  If a tenant who was sole owner of a mobile home dies during the term of a rental agreement then that person’s heirs or legal representative or the landlord shall have the right to cancel the tenant’s lease by giving sixty days’ written notice to the person’s heirs or legal representative or to the landlord, whichever is appropriate, and the heirs or the legal representative shall have the same rights, privileges and liabilities of the original tenant.
   b.  (1)  If a tenant who was sole owner of a mobile home dies during the term of a rental agreement resulting in the mobile home being abandoned as provided in section 562B.27, subsection 1, and the landlord cannot, despite due diligence, locate such tenant’s heirs or legal representatives, then the landlord may bring an action for abandonment as provided in section 555B.3, naming as defendants the estate of the tenant and any and all unknown heirs of the tenant and, upon the landlord’s filing of an affidavit that personal service cannot be had on any heir, legal representative, or estate of the tenant, the court shall permit original notice of such action to be served by publication pursuant to subparagraph (2) of this paragraph.
   (2)  Publication of the original notice shall be made once each week for three consecutive weeks in a newspaper of general circulation published in the county where the petition is filed, as provided in rules of civil procedure 1.313 and 1.314. Service is complete after the third consecutive weekly publication.
   (3)  In the event any tax lien or other lien exists on the mobile home, the landlord may proceed with an action for abandonment as provided in section 555B.3, except that:
   (a)  Notice shall be provided to the county treasurer as provided in section 555B.4, subsection 3, if a tax lien exists.
   (b)  Personal service pursuant to rule of civil procedure 1.305 shall be made upon any lienholder no less than twenty days before the hearing.
   (4)  Any notice to a lienholder shall state that failure to assert a claim to the mobile home is deemed a waiver of all right, title, claim, and interest in the mobile home and is deemed consent to the sale or disposal of the mobile home. If personal service upon the lienholder cannot be completed in time to give the lienholder the minimum notice required by subparagraph (3), the court may set a new hearing date.
    Sec. 7.  Section 648.5, subsection 1, Code 2019, is amended to read as follows:
   1.  An action for forcible entry and detainer shall be brought in a county where all or part of the premises is located. Such an action shall be tried as an equitable action. Upon receipt of the petition, the court shall set a date, time, and place for hearing. The court shall set the date of hearing no later than eight days from the filing date, except that the court shall set a later hearing date no later than fifteen days from the date of filing if the plaintiff requests or consents to the later date of hearing.  The requirement regarding the setting of the initial hearing is not a jurisdictional requirement and does not affect the court’s subject matter jurisdiction to hear the action for forcible entry and detainer.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to landlord remedies and procedures relating to failure to timely pay rent, abandonment, and forcible entry and detainer.
   Current law caps late fees on rental agreements in which rent is greater than $700 per month at $20 per day and $100 per month. Current law also allows an aggrieved party to recover actual damages in certain situations when a prohibited provision is willingly or knowingly used in a rental agreement.
   The bill allows a rental agreement to provide for late fees not to exceed 2 percent of the rent per day and 10 percent of the rent per month when rent exceeds $1,400 per month.
   The bill makes changes to the process for an action for abandonment of mobile homes. The bill extends the time by which a district court shall set a hearing after receiving a petition from not later than 14 days to no sooner than 25 days when there is a lien other than a tax lien on the mobile home or personal property. The bill provides notice, service, and publication procedures in an action for abandonment if the sole owner of a mobile home dies during the term of a rental agreement.
   The bill also makes a procedural change relating to jurisdiction in actions for forcible entry and detainer.