A BILL TO BE ENTITLED
AN ACT to clarify the requirements for selling and installing modular homes.
The General Assembly of North Carolina enacts:
SECTION 1.  Chapter 143 of the General Statutes is amended by adding a new Article to read:
"Article 9G.
"Modular Home Sales and Installation Requirements.
"§ 143‑151.70.  Definitions.
The following definitions apply in this Article:
(1)	Modular home. – A factory‑built structure that is designed for use as a one‑ or two‑family dwelling, is manufactured in accordance with the specifications for modular homes under the North Carolina State Residential Building Code, and bears a seal or label issued by the Department of Insurance under G.S. 143‑139.1.
(2)	Modular homebuilder. – A person who, for consideration, sells a modular home to a purchaser for occupancy. This term does not include (i) a real estate broker or provisional broker licensed under Chapter 93A of the General Statutes or (ii) any person who installs or erects a modular home on land owned by that person provided the home is intended solely for occupancy by that person or that person's family after completion and the home is in fact so occupied for at least 12 months following completion.
(3)	General contractor. – A person defined in G.S. 87‑1.
(4)	Manufactured home dealer. – A person defined in G.S. 143‑143.9(7) and licensed under G.S. 143‑143.11.
(5)	Set‑up contractor. – A person defined in G.S. 143‑143.9(13) and licensed under G.S. 143‑143.11.
(6)	Person. – Any individual, natural person, firm, partnership, association, corporation, legal representative, or other recognized legal entity.
"§ 143‑151.71.  Selling and installation requirements.
(a)	A modular homebuilder doing business in this State shall be licensed as either a manufactured home dealer pursuant to G.S. 143‑143.11 or as a general contractor pursuant to Article 1 of Chapter 87 of the General Statutes.
(b)	Any person, other than a manufactured home dealer or general contractor, who undertakes to erect a modular home for compensation shall be licensed by this State as a set‑up contractor pursuant to G.S. 143‑143.11.
(c)	A set‑up contractor who undertakes to erect a North Carolina labeled modular home shall comply with the manufacturer's installation instructions and applicable provisions of the State Building Code. Before a permit is issued to erect a modular home, the set‑up contractor shall provide the code enforcement official proof that the contractor has in force for each modular home to be erected a five thousand dollar ($5,000) surety bond insuring compliance with the provisions of the State Building Code governing installation of modular homes. The bond shall cover installation of the home as defined in the manufacturer's installation requirements. The bond required by this subsection shall be in addition to the bond required by G.S. 143‑143.12(a)(4).
(d)	A manufactured home dealer who undertakes to erect a North Carolina labeled modular home shall comply with the manufacturer's installation instructions and applicable provisions of the State Building Code. Before securing a permit to erect a modular home, a manufactured home dealer shall provide the code enforcement official proof that the dealer has in force for each modular home to be erected a five thousand dollar ($5,000) surety bond insuring compliance with the provisions of the State Building Code governing modular homes. The bond shall cover installation of the home as defined in the manufacturer's installation requirements. The bond required by this subsection shall be in addition to the bond required by G.S. 143‑143.12(a)(2) and (3).
(e)	With respect to a manufactured home dealer who is a modular homebuilder, the bond required by G.S. 143‑143.12(a)(2) or (3) shall be conditioned upon the obligor faithfully conforming to and abiding by the provisions of this Article, in addition to the provisions of Article 9A of this Chapter. Any buyer of a modular home who suffers any loss or damage by any act of a dealer that constitutes a violation of this Article may institute an action to recover against the dealer and any surety.
(f)	With respect to a set‑up contractor who undertakes to erect modular homes, the bond required by G.S. 143‑143.12(a)(4) shall be conditioned upon the obligor faithfully conforming to and abiding by the provisions of this Article, in addition to the provisions of Article 9A of this Chapter. Any buyer of a modular home who suffers any loss or damage by any act of a set‑up contractor that constitutes a violation of this Article may institute an action to recover against the contractor and any surety.
(g)	In erecting a modular home, any person undertaking to provide additional, on‑site constructed improvements to the modular home, or to the property on which the modular home is situated, shall be licensed as a general contractor if the amount of the undertaking exceeds the amount established in G.S. 87‑1.
(h)	A complaint by a buyer of a modular home that arises out of the sale or installation of the modular home shall be filed with the Manufactured Housing Board if the complaint is against a manufactured home dealer or a set‑up contractor in accordance with Article 9A of Chapter 143 of the General Statutes. Article 9A of Chapter 143 of the General Statutes shall apply to all complaints filed against manufactured home dealers or set‑up contractors.
(i)	A complaint by a buyer of a modular home that arises out of the installation of a modular home shall be filed with the State Licensing Board for General Contractors in accordance with Article 1 of Chapter 87 of the General Statutes if the complaint is against a general contractor. Article 1 of Chapter 87 of the General Statutes shall apply to all complaints filed against general contractors."
SECTION 2.  G.S. 87‑2 reads as rewritten:
"§ 87‑2.  Licensing Board; organization.
There is created the State Licensing Board for General Contractors consisting of nine members appointed by the Governor for staggered five‑year terms. Five of the members shall be general contractors, one member shall be a registered engineer who practices structural engineering, and three shall be public members. Of the general contractor members, one shall have as the larger part of his business the construction of highways; one shall have as the larger part of his business the construction of public utilities; one shall have as the larger part of his business the construction of buildings; and two shall have as a larger part of their businesses the construction of residences, one of whom shall be the holder of an unlimited general contractor's  license, and one whom shall be a modular homebuilder, as defined in G.S. 143‑151.70(2). The public members shall have no ties with the construction industry and shall represent the interests of the public at large. Members shall serve until the expiration of their respective terms and until their successors are appointed and qualified. Vacancies occurring during a term shall be filled by appointment of the Governor for the remainder of the unexpired term. The Governor may remove any member of the Board for misconduct, incompetency, or neglect of duty. No Board member shall serve more than two complete consecutive terms."
SECTION 3.  G.S. 87‑13 reads as rewritten:
"§ 87‑13.  Unauthorized practice of contracting; impersonating contractor; false certificate; giving false evidence to Board; penalties.
Any person, firm, or corporation not being duly authorized who shall contract for or bid upon the construction of any of the projects or works enumerated in   or Article 9G of Chapter 143 of the General Statutes, without having first complied with the provisions hereof, or who shall attempt to practice general contracting in the State, except as provided for in this Article, and any person, firm, or corporation presenting or attempting to file as his own the licensed certificate of another or who shall give false or forged evidence of any kind to the Board or to any member thereof in maintaining a certificate of license or who falsely shall impersonate another or who shall use an expired or revoked certificate of license, and any architect or engineer who recommends to any project owner the award of a contract to anyone not properly licensed under this Article, shall be deemed guilty of a Class 2 misdemeanor. And the Board may, in its discretion, use its funds to defray the expense, legal or otherwise, in the prosecution of any violations of this Article or Article 9G of Chapter 143 of the General Statutes. No architect or engineer shall be guilty of a violation of this section if his recommendation to award a contract is made in reliance upon current written information received by him from the appropriate Contractor Licensing Board of this State which information erroneously indicates that the contractor being recommended for contract award is properly licensed."
SECTION 4.  G.S. 87‑13.1 reads as rewritten:
"§ 87‑13.1.  Board may seek injunctive relief.
Whenever the Board determines that any person, firm or corporation has violated or is violating any of the provisions of this Article or Article 9G of Chapter 143 of the General Statutes or rules and regulations of the Board promulgated under this  Article or Article 9G of Chapter 143 of the General Statutes, the Board may apply to the superior court for a restraining order and injunction to restrain the violation; and the superior courts have jurisdiction to grant the requested relief, irrespective of whether or not criminal prosecution has been instituted or administrative sanctions imposed by reason of the violation. The court may award the Board its reasonable costs associated with the investigation and prosecution of the violation."
SECTION 5.  G.S. 143‑143.13(a) is amended by adding a new subdivision to read:
"(15)	Violating Article 9G of this Chapter."
SECTION 6.  Nothing in this act shall affect the members of the State Licensing Board for General Contractors in effect on January 1, 2008, and the terms of their membership.
SECTION 7.  This act becomes effective January 1, 2008, and applies to offenses committed on or after that date.