N.M. Admin. Code § 14.5.9.10

Current through Register Vol. 35, No. 21, November 5, 2024

Section 14.5.9.10 - CERTIFICATES OF UNCORRECTED VIOLATIONS

A. Cause for issuance of a CUV: If a licensee refuses or fails to correct code violations listed on a CVD, whether the refusal or failure to correct occurs at the time of the initial issuance of the CVD, after multiple corrections have been attempted or after a licensee exhausts all appeal rights provided under Subsection B of 14.5.9.9 NMAC, the division shall issue a CUV to the surety as well as the indemnitee and the appropriate licensee(s).

B. Notice of CUV: The CUV shall include the following information:

(1)name and mailing address of the surety company holding the code compliance bond at the time the licensee(s) refused to correct the code violation;

(2)name and mailing address(es) of the licensee(s) that committed the uncorrected code violation(s);

(3)name and mailing address of the indemnitee;

(4)bond number for the responsible party's bond in effect at the time the licensee refused to correct the code violation(s);

(5)all license classifications held by the licensee(s);

(6)address of the construction project where the uncorrected code violation(s) is located;

(7)date the certificate of occupancy was issued or the final inspection was conducted by the AHJ;

(8)a description of each uncorrected code violation; and

(9)the following statement: "this notice serves to inform the surety company, the indemnitee and the licensee that the specified licensee(s) has refused or failed to correct a code violation(s) and

therefore the construction industries division, under Section 60-13-49 NMSA 1978, is informing the surety that the code bond must be released for the sole purpose of correcting the code violation(s) identified herein. The pay-out by the surety company is limited to the amount of the code bond, which is set by statute at $10,000.00. If the actual costs to correct the code violation(s) exceeds $10,000.00, the indemnitee is responsible for those costs. The requirements of the surety and indemnitee are listed under 14.5.9 NMAC. The indemnitee is also notified that the claim may be denied if they fail to meet the requirements listed in 14.5.9.10 NMAC."

C. Responsibility of indemnitee: The indemnitee is responsible for meeting the following requirements; failure to do so may result in the surety denying the claim.

(1)The indemnitee shall obtain three estimates from properly licensed contractors. The estimates shall only be based on the costs to correct the code violations listed in the CUV. If the indemnitee wishes to contract for additional work, that work must be a separate agreement, the costs of which will not be included in the estimate to repair the code violations listed in the CUV. The surety company has the option to release no more than the costs listed in the lowest of the three estimates. The indemnitee can choose any of the three contractors, or a separate properly licensed contractor not included in the three estimates, however, the indemnitee will be responsible for any costs above the amount the surety company releases.

(2)The indemnitee shall provide the three estimates to the surety company as well as the division. The division will ensure that the all three contractors are licensed and have the right license classification(s) for the work required to correct the code violations listed in the CUV. The division will notify the surety company and the indemnitee if each of the three contractors is properly licensed. If a contractor other than the three used for the original estimates is selected by the indemnitee, the indemnitee must submit that contractor's estimate to the division for verification that the contractor is licensed and possesses the necessary licensing classifications before work begins. The surety company shall release no more than the costs listed in the lowest of the three estimates.

D. Responsibility of contractor retained by indemnitee: The contractor is responsible for pulling all necessary permits and calling for inspections on the work performed.

E. Six-month time limitation to correct code violations: Once the CUV is issued, the indemnitee has a period of six months to ensure that all code violations identified in the CUV are corrected and pass inspection by the division or AHJ. Failure to meet the requirements listed in Subsection C of 14.5.9.10 NMAC in a period of six months may result in the surety denying the claim.

F. Release of the code bond: If all requirements of this section are met, the surety company shall release the amount of the bond consistent with Paragraph (1) of Subsection C of 14.5.9.10 NMAC to correct the code violations as listed in the CUV by issuing a check to the contractor that performed the corrections after the division or AHJ has confirmed that the corrections meet code. The surety company shall inform the division when the code bond is released.

N.M. Admin. Code § 14.5.9.10

Adopted by New Mexico Register, Volume XXVI, Issue 06, March 31, 2015, eff. 4/30/2015