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Minnesota Legislature

Office of the Revisor of Statutes

327B.04 MANUFACTURERS AND DEALERS; LICENSES; BONDS.
    Subdivision 1. License, bond, and liability insurance required. No person shall act as
a dealer in manufactured homes, new or used, without a license, a surety bond, and liability
insurance as provided in this section. No person shall manufacture manufactured homes without a
license for each manufacturing facility shipping into or located within Minnesota's boundaries,
a surety bond, and liability insurance as provided in this section. The licensing and bonding
requirements of this section do not apply to any bank, savings bank, savings association, or credit
union, chartered by either this state or the federal government, which acts as a dealer only by
repossessing manufactured homes and then offering the homes for resale.
    Subd. 2. Subagency licenses. Any dealer who has a place of business at more than one
location shall designate one location as its principal place of business, one name as its principal
name, and all other established places of business as subagencies. A subagency license shall
be required for each subagency. No dealer shall do business as a dealer under any other name
than the name on its license.
    Subd. 3. License application. Application for a license and its renewal shall be made to
the commissioner, shall be in writing, and duly verified by oath. The applicant shall submit any
information required by the commissioner, upon forms provided by the commissioner for that
purpose, including:
(a) proof of identity;
(b) the name under which the applicant will be licensed and do business in this state;
(c) the applicant's type and place of business;
(d) The name, home and business address of the applicant's directors, officers, limited and
general partners, controlling shareholders and affiliates;
(e) whether the applicant, or any of its directors, officers, limited or general partners,
controlling shareholders or affiliates, has been convicted of a crime within the previous ten years
that either related directly to the business for which the license is sought or involved fraud,
misrepresentation or misuse of funds, or has suffered a judgment in a civil action involving fraud,
misrepresentation, or conversion within the previous five years or has had any government license
or permit suspended or revoked as a result of an action brought by a federal or state governmental
agency in this or any other state within the last five years; and
(f) the applicant's qualifications and business history, including whether the applicant, or
any of its directors, officers, limited or general partners, controlling shareholders or affiliates has
ever been adjudged bankrupt or insolvent, or has any unsatisfied court judgments outstanding
against it or them.
    Subd. 4. License prerequisites. No application shall be granted nor license issued until
the applicant proves to the commissioner that:
    (a) the applicant has a permanent, established place of business at each licensed location. An
"established place of business" means a permanent enclosed building other than a residence, or
a commercial office space, either owned by the applicant or leased by the applicant for a term
of at least one year, located in an area where zoning regulations allow commercial activity, and
where the books, records and files necessary to conduct the business are kept and maintained.
The owner of a licensed manufactured home park who resides in or adjacent to the park may use
the residence as the established place of business required by this subdivision, unless prohibited
by local zoning ordinance.
    If a license is granted, the licensee may use unimproved lots and premises for sale, storage,
and display of manufactured homes, if the licensee first notifies the commissioner in writing;
    (b) if the applicant desires to sell, solicit or advertise the sale of new manufactured homes, it
has a bona fide contract or franchise in effect with a manufacturer or distributor of the new
manufactured home it proposes to deal in;
    (c) the applicant has secured: (1) a surety bond in the amount of $20,000 for the agency
and each subagency location that bears the applicant's name and the name under which the
applicant will be licensed and do business in this state. Each bond is for the protection of
consumer customers, and must be executed by the applicant as principal and issued by a surety
company admitted to do business in this state. Each bond shall be exclusively for the purpose
of reimbursing consumer customers and shall be conditioned upon the faithful compliance by
the applicant with all of the laws and rules of this state pertaining to the applicant's business
as a dealer or manufacturer, including sections 325D.44, 325F.67 and 325F.69, and upon the
applicant's faithful performance of all its legal obligations to consumer customers; and (2) a
certificate of liability insurance in the amount of $1,000,000 that provides coverage for the agency
and each subagency location;
    (d) the applicant has established a trust account as required by section 327B.08, subdivision
3
, unless the applicant states in writing its intention to limit its business to selling, offering for
sale, soliciting or advertising the sale of new manufactured homes; and
    (e) the applicant has provided evidence of having had at least two years' prior experience in
the sale of manufactured homes, working for a licensed dealer.
    Subd. 5. Exemption for real estate brokers and salespeople. Any person licensed as a real
estate broker or salesperson under chapter 82 who brokers the sale of used manufactured homes is
not required to obtain a license or a bond as required by this section, but is subject to all other
provisions of sections 327B.01 to 327B.12. Any real estate broker or salesperson who violates
a provision of sections 327B.06 to 327B.09 in selling or offering for sale a used manufactured
home shall be deemed to have violated a provision of chapter 82.
    Subd. 6. Certificate of license. For each license granted the commissioner shall issue a
certificate which includes the name of the licensee, the name of the surety company and the
amount of the surety bond, and the insurance underwriter and policy number, the names and
addresses of any related principal or subagencies, and a license number.
    Subd. 7. Fees; licenses; when granted. Each application for a license or license renewal
must be accompanied by a fee in an amount established by the commissioner by rule pursuant
to section 327B.10. The fees shall be set in an amount which over the fiscal biennium will
produce revenues approximately equal to the expenses which the commissioner expects to incur
during that fiscal biennium while administering and enforcing sections 327B.01 to 327B.12. The
commissioner shall grant or deny a license application or a renewal application within 60 days
of its filing. If the license is granted, the commissioner shall license the applicant as a dealer
or manufacturer for the remainder of the calendar year. Upon application by the licensee, the
commissioner shall renew the license for a two year period, if:
    (a) the renewal application satisfies the requirements of subdivisions 3 and 4;
    (b) the renewal applicant has made all listings, registrations, notices and reports required by
the commissioner during the preceding year; and
    (c) the renewal applicant has paid all fees owed pursuant to sections 327B.01 to 327B.12 and
all taxes, arrearages, and penalties owed to the state.
    Subd. 8. Limited dealer's license. The commissioner shall issue a limited dealer's license to
an owner of a manufactured home park authorizing the licensee as principal only to engage in the
sale, offering for sale, soliciting, or advertising the sale of used manufactured homes located in
the owned manufactured home park. The licensee must be the title holder of the homes and may
engage in no more than ten sales annually. An owner may, upon payment of the applicable fee
and compliance with this subdivision, obtain a separate license for each owned manufactured
home park and is entitled to sell up to ten homes per license provided that only one limited dealer
license may be issued for each park. The license shall be issued after:
    (1) receipt of an application on forms provided by the commissioner containing the following
information:
    (i) the identity of the applicant;
    (ii) the name under which the applicant will be licensed and do business in this state;
    (iii) the name and address of the owned manufactured home park, including a copy of the
park license, serving as the basis for the issuance of the license;
    (iv) the name, home, and business address of the applicant;
    (v) the name, address, and telephone number of one individual that is designated by the
applicant to receive all communications and cooperate with all inspections and investigations
of the commissioner pertaining to the sale of manufactured homes in the manufactured home
park owned by the applicant;
    (vi) whether the applicant or its designated individual has been convicted of a crime within
the previous ten years that is either related directly to the business for which the license is sought
or involved fraud, misrepresentation or misuse of funds, or has suffered a judgment in a civil
action involving fraud, misrepresentation, or conversion within the previous five years or has
had any government license or permit suspended or revoked as a result of an action brought by a
federal or state governmental agency in this or any other state within the last five years; and
    (vii) the applicant's qualifications and business history, including whether the applicant or
its designated individual has ever been adjudged bankrupt or insolvent, or has any unsatisfied
court judgments outstanding against it or them;
    (2) payment of a $100 annual fee; and
    (3) provision of a surety bond in the amount of $5,000. A separate surety bond must be
provided for each limited license.
    The applicant need not comply with section 327B.04, subdivision 4, paragraph (e). The
holding of a limited dealer's license does not satisfy the requirement contained in section 327B.04,
subdivision 4
, paragraph (e), for the licensee or salespersons with respect to obtaining a dealer
license. The commissioner may, upon application for a renewal of a license, require only a
verification that copies of sales documents have been retained and payment of a $100 renewal
fee. "Sales documents" mean only the safety feature disclosure form defined in section 327C.07,
subdivision 3a
, title of the home, financing agreements, and purchase agreements.
    The license holder shall, upon request of the commissioner, make available for inspection
during business hours sales documents required to be retained under this subdivision.
    Subd. 8a. Service. Service of a document on a limited dealer licensed under this section may
be effected by mail to or by personal service on: (1) the licensee at the licensee's last known
address; or (2) the individual designated by the licensee at that individual's last known address.
History: 1982 c 526 art 1 s 4; 1983 c 142 s 3; 1983 c 216 art 1 s 54; 1986 c 444; 1995 c 202
art 2 s 28; 1997 c 202 art 2 s 44; 1998 c 280 s 1; 2000 c 352 s 1; 2007 c 135 art 8 s 5; 2007
c 140 art 4 s 51-56