HAR §15-307-144. Repurchase of dwelling unit

(a) Upon receipt of a notice of construction or soil defect, the corporation shall review the notice and conduct an investigation to determine if a substantial construction or soil defect exists in the dwelling unit and if at least one of the following conditions also exists: (1) The dwelling unit has been found to be unsafe by the building department of the county in which the dwelling unit is situated; (2) The corporation determines that the construction or soil defect cannot be repaired or it will not be economically feasible to repair the construction or soil defect; or (3) The corporation determines that the construction or soil defect is of such a magnitude that it will take longer than one year to repair. (b) If the corporation determines that there is a substantial construction or soil defect in the dwelling unit and at least one of the conditions set forth in paragraph (a)(1), (a)(2) or (a)(3) also exists, then the corporation, upon approval by the board, may, but shall not be obligated to: (1) Enter into a repurchase agreement with the owner and repurchase the dwelling unit; or (2) If the owner fails to enter into a repurchase agreement, then execute and deliver to the owner a statement of intent to enforce its repurchase right within the [ninety day] ninety-day period prescribed under section 15-308-89 and repurchase the dwelling unit without the owner's consent. (c) If the corporation repurchases the dwelling unit pursuant to section 201H-51, HRS, then the repurchase shall include the transfer by the owner to the corporation of the owner's right, title, and 307-40 interest in the dwelling unit and rights with respect to the dwelling unit as more fully described in paragraph (d)(2) and the repurchase price shall be established pursuant to section 15-308-85. (d) The repurchase agreement between the owner and the corporation shall include at least the following: (1) A release and indemnification by the owner in favor of the corporation relating to any liability arising out of [the], and any work performed by, design professionals and contractors to repair the dwelling unit. (2) A covenant that the owner shall, pursuant to the repurchase agreement, transfer to the corporation all of the owner's right, title, and interest in the dwelling unit and all of the owner's rights with respect to the dwelling unit, including, but not limited to, all of the rights of the owner under instruments such as the deed or lease and contracts of warranty, claims for relief under contracts, and claims for relief for tortuous conduct. (e) If the corporation repurchases the dwelling unit pursuant to section 201H-51, a displacee certificate, effective for ten years, shall be issued to the owners. Only one displacee certificate shall be issued for each dwelling unit repurchased. [Eff 12/04/10; comp 4/28/17; am and comp 1/15/22; am and comp ] (Auth: HRS §§201H-4, 201H- 51) (Imp: HRS §201H-51)