AZ LAW BOOK

R4-28-B1207. Subsequent Owner A. Except as provided in A.R.S. § 32-2181.02, any developer who is a successor in interest to six or more lots within a subdivision on which the Department previously issued a public report shall file an application for and obtain a new public report before offering or selling any lot. B. Any developer who is a successor in interest to six or more parcels within an unsubdivided land development on which the Department previously issued a public report shall file an application for and obtain a new public report before offering or selling any parcel. C. Any developer who is a successor in interest to 12 or more time-share intervals within a time-share project on which the Department previously issued a public report shall file an application for and obtain a new public report, before offering or selling any interval. D. The Department shall not issue a new public report to a subsequent owner of a development if the previous developer failed to complete proposed improvements in accordance with estimated completion dates specified in the previously issued public report until one of the following occurs: 1. The subsequent owner makes financial arrangements, as described in R4-28-A1211, in favor of the local governmental authority and for the benefit of purchaser, securing the owner's promise to complete the previously proposed improvements by a designated date; or 2. The subsequent owner becomes obligated to place all sales funds in a neutral escrow depository until the Department is furnished satisfactory evidence that all proposed improvements have been completed or accepted by the city or county; or 3. Permission is obtained by all previous purchasers in the development for completion of the proposed improvements by the new designated date for completion; or 4. The subsequent owner establishes to the satisfaction of the Department that adequate financial arrangements have been made to assure completion of the proposed improvements by the new designated date for completion. E. A developer who is a new owner of property that is the subject of a pending application for a public report shall not replace or be substituted for the applicant of the pending application. R4-28-B1208. Public Report Correction If the public report contains an error, the Department shall correct the report at its own expense. Additional or changed information that was known to the developer before issuance of the report is not an error. The Department shall not correct the public report after it has been in effect for 10 days. After 10 days, the developer shall change the report through the development amendment process, established in A. The Department shall not issue or amend a public report for any lot held under option or subject to a blanket encumbrance if a condition precedent to the optionee's right to acquire the lot or to release from the blanket encumbrance shows that the lot shall: 1. Be acquired or released in a particular sequence, 2. Be acquired or released only after one or more additional lots have been acquired or released, or 3. Not be released if the encumbrance is in default because of a cross-default provision contained in the encumbrance, B. The developer may require payment of a premium to permit the acquisition or release of the lot. C. When a blanket encumbrance clouds title to a development, the developer shall place a written statement from the holder of the blanket encumbrance in the public report application, quoting the provisions that enable a buyer to acquire title to a lot, free of the blanket encumbrance. R4-28-B1210. Earnest Money The developer shall deposit earnest money and down payments in a neutral depository if: 1. The seller is in bankruptcy; 2. The sale is conditional pursuant to R4-28-B1202; or 3. The Department perceives a risk to the buyer. R4-28-B1203, with payment of the applicable amendment fee. R4-28-B1209. Options; Blanket Encumbrances; Releases

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Law Book Revised 11.02.2017