Rhode Island General Laws 34-49-5. Escrow of disputed amounts
(a) Except as otherwise provided in this section, whenever a claim for lien has been filed with the appropriate land evidence records, and an escrow account is established either from the proceeds from the transaction, conveyance, or any other source of funds in an amount computed as one hundred fifty percent (150%) of the amount of the claim for lien, then the lien against the real estate shall be extinguished and immediately become a lien on the funds contained in the escrow account. Upon creation of such escrow, the lien claimant shall be required to provide and record a release of lien against the real estate within five (5) business days. In the event that the lien claimant fails to provide or record a release of lien, then the escrowee is hereby authorized to either: (1) Execute and record a release of lien; or (2) Pay into the registry of the superior court in the county where the land is located an amount equal to one hundred fifty percent (150%) of the amount claimed in the notice of lien; or (3) In lieu of cash, deposit in the registry of the court the bond of a surety company licensed to do business in this state in the amount of one hundred fifty percent (150%) of the amount claimed in the notice of lien. On proper proof of payment or deposit and on motion of the owner or lessee or tenant, any justice of the superior court shall enter ex parte, an order discharging and releasing the notice of lien and dismissing the cause as to the owner or lessee or tenant and as to all persons having any title, claim, lease, mortgage, attachment, or other lien or encumbrance, and upon entry of the order, the property shall be as if no notice of lien was recorded. Provided, however, that with respect to the escrowed funds and/or surety bond, proceeds the real estate broker’s lien attaches to such escrowed funds and/or surety bond proceeds whichever applies;
Terms Used In Rhode Island General Laws 34-49-5
- Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Lien: A claim against real or personal property in satisfaction of a debt.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- real estate: may be construed to include lands, tenements, and hereditaments and rights thereto and interests therein. See Rhode Island General Laws 43-3-10
(b) The requirement to establish an escrow account or election to take measures described in subdivision (a)(2) or (a)(3) above, shall not be cause for any party to refuse to complete or close the transaction.
History of Section.
P.L. 2013, ch. 69, § 1; P.L. 2013, ch. 76, § 1.