HOUSE BILL 365
51st legislature - STATE OF NEW MEXICO - first session, 2013
INTRODUCED BY
Antonio "Moe" Maestas
AN ACT
RELATING TO COMMERCIAL REAL ESTATE; CREATING THE COMMERCIAL REAL ESTATE BROKER LIEN ACT; REQUIRING NOTICE; LIMITING TIME TO FILE SUIT TO ENFORCE LIEN; PROVIDING FOR ALTERNATIVE DISPUTE RESOLUTION; PROVIDING FOR AWARD OF ATTORNEY FEES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. SHORT TITLE.--This act may be cited as the "Commercial Real Estate Broker Lien Act".
SECTION 2. DEFINITIONS.--As used in the Commercial Real Estate Broker Lien Act:
A. "broker" means a person licensed as a qualifying broker under the provisions of Chapter 61, Article 29 NMSA 1978; and
B. "commercial real estate" means any real estate other than:
(1) real estate containing one to four residential units;
(2) real estate on which no buildings or structures are located and that is zoned for single-family residential use; or
(3) single-family residential units such as apartments, condominiums, town houses or homes in a subdivision when sold, leased or otherwise conveyed on a unit-by-unit basis, even though these units may be a part of a larger building or parcel of real estate containing more than four residential units.
SECTION 3. BROKER'S LIEN FOR COMPENSATION FOR SERVICES--REQUIREMENTS.--A broker shall have a lien upon commercial real estate or any interest in commercial real estate in the amount that the broker is due for licensed services connected with the leasing of the commercial real estate, which may include brokerage fees and consulting fees if the broker:
A. is entitled to a stated fee or commission provided in a written instrument that:
(1) identifies the commercial real estate;
(2) sets forth the fee or commission due and the date or circumstances under which the fee or commission is due; and
(3) is signed by the owner of the commercial real estate or the owner's authorized agent; and
B. records a notice of lien on the commercial real estate pursuant to Section 4 of the Commercial Real Estate Broker Lien Act. Such lien shall only be valid against the commercial real estate identified in the written instrument described in Subsection A of this section and in the amount due for the fee or commission stated therein.
SECTION 4. NOTICE OF LIEN--ATTACHMENT REQUIREMENTS--RECORDING--CONTENTS--MAILING.--
A. A broker shall record a notice of lien within ninety days following the date on which payment is due as set forth in a written instrument as required by Section 3 of the Commercial Real Estate Broker Lien Act. If compensation is to be paid in installments, a broker may elect to file a single claim of lien within ninety days following the date the first installment is due for all installments due under the written instrument or to file a lien for future installments within ninety days following the date the future installments are due. In the event a broker is due additional commission as a result of future actions related to a lease, including the exercise of an option to expand leased commercial real estate or to renew or extend a lease, the broker shall record a notice of lien no earlier than the occurrence of the act or event for which the broker's additional commission is earned and not later than ninety days after the occurrence of the act or event for which the broker's additional commission is earned.
B. If the commercial real estate is sold or otherwise conveyed and the broker has filed a valid notice of lien prior to the sale or other conveyance, the purchaser or transferee shall be deemed to have notice of and shall take title to the commercial real estate subject to the notice of lien.
C. A lien shall attach as of the date of the recording of the notice of lien pursuant to Subsection A of this section.
D. Nothing in the Commercial Real Estate Broker Lien Act shall limit or otherwise affect claims, defenses or other remedies that a broker, owner or any other party may have in law or equity.
E. A notice of lien shall be recorded in the county clerk's office of the county in which the commercial real estate is located and shall include:
(1) the name, address and license number of the broker;
(2) the amount for which the lien is claimed;
(3) a legal description of the commercial real estate or a description sufficient to identify the commercial real estate; and
(4) the name and last known address of the owner of the commercial real estate.
F. Within ten days of recording the notice of lien, the broker shall mail a copy of the notice of lien by certified mail, return receipt requested, to the last known address of the owner of the commercial real estate or the owner's authorized agent.
SECTION 5. COMMENCEMENT OF ACTION--DEMAND FOR SUIT TO ENFORCE LIEN--RECORDING SATISFACTION OF LIEN.--
A. A broker claiming a lien under the Commercial Real Estate Broker Lien Act shall, within two years after recording the notice of lien, bring suit to enforce the lien in the district court in the county where the commercial real estate is located. Failure to commence proceedings pursuant to this subsection shall extinguish the lien.
B. An owner of the commercial real estate or the owner's authorized agent may serve written demand, by certified mail, return receipt requested, or by personal service, on the broker claiming the lien requiring the broker to file suit to enforce the lien. The broker shall file suit in the district court in the county where the commercial real estate is located within thirty days of receipt of the written demand. Failure to file suit upon written demand pursuant to this subsection shall extinguish the lien.
C. If a broker's lien has been recorded pursuant to Section 4 of the Commercial Real Estate Broker Lien Act and the indebtedness has been paid in full or the lien has been extinguished or is otherwise not enforceable pursuant to law, within ten days after the indebtedness has been paid in full, the lien has been extinguished or becomes unenforceable pursuant to law, the broker shall:
(1) record a written release or satisfaction of the lien in the county clerk's office of the county in which the commercial real estate is located; and
(2) mail a copy of the recorded release or satisfaction by certified mail, return receipt requested, to the last known address of the owner of the commercial real estate or the owner's authorized agent.
SECTION 6. ESCROW OF DISPUTED AMOUNTS.--A lien filed with the county clerk's office against commercial real estate shall be automatically extinguished and shall immediately become a lien on the funds held in an established escrow account under the following conditions:
A. the owner of the commercial real estate against which the lien has been filed or the owner's authorized agent establishes an escrow account with an escrow company licensed under Chapter 58, Article 22 NMSA 1978 or a title insurance company licensed under Chapter 59A, Article 30 NMSA 1978 in an amount computed as one hundred twenty-five percent of the amount of the claim for lien; and
B. a representative of the escrow or title company files an affidavit with the county clerk's office identifying the commercial real estate against which the lien has been filed and certifying that an escrow account has been established by the owner of the commercial real estate or the owner's authorized agent in accordance with this section.
SECTION 7. ALTERNATIVE DISPUTE RESOLUTION.--If the broker and the party or parties from whom the commission is claimed agree in writing to alternative dispute resolution, the claim shall be addressed in a forum upon which the parties have agreed. If a lien foreclosure proceeding is initiated, the court before which a lien foreclosure proceeding is brought shall retain jurisdiction over all parties to the foreclosure to enter judgment on an award or other result made or reached in alternative dispute resolution. During the pendency of the alternative dispute resolution process, the notice of lien shall remain of record and the foreclosure proceeding shall be stayed.
SECTION 8. ATTORNEY FEES.--The cost of proceedings, including trial and appellate court proceedings and alternative dispute resolution, brought pursuant to the Commercial Real Estate Broker Lien Act, including reasonable attorney fees, expenses of litigation and prejudgment interest, shall be awarded to the prevailing party or parties. When more than one party is responsible for costs, fees and prejudgment interest, the costs, fees and prejudgment interest shall be equitably apportioned by the court or tribunal among those responsible parties.
SECTION 9. PRIORITY OF LIEN.--Prior valid recorded liens, mortgages and other encumbrances shall have priority over a broker's lien.
SECTION 10. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2013.
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