USA - NEW JERSEY Law and Practice Contributed by: Steven Fleissig, David Freylikhman, Cory Mitchell Gray and David Jensen, Greenberg Traurig LLP
both conditions of this test are met, in connec - tion with an ISRA-subject triggering event, the parties are required to comply with ISRA’s provi - sions, which entails notice to the state and the retention of a licensed site remediation profes - sional (LSRP) to evaluate and then propose and oversee remediation, if necessary. While ISRA obligations default to the seller, ultimate com - pliance and performance may be contractually allocated between the parties. If the property is ISRA-subject, appropriate provisions must be inserted in the purchase contract to ensure com - pliance and protection of the parties. The actions of the LSRP are tightly regulated by the state to ensure compliance with the state’s laws by a non-state entity. ISRA is a complex and detailed statute, and its provisions cannot be adequately summarised in this format. “Green Cards” The Bureau of Housing Inspection administers the New Jersey Hotel and Multiple Dwelling Law which requires that multi-family properties, hotels, and motels maintain valid Green Cards which are issued after property is registered, inspections and reinspections have been con - ducted, all violations are corrected, and all fees paid. As part of any transfer of property relating to this subject asset class, purchasers should request to see Green Cards as part of their dili - gence efforts and should look to ensure they are valid as of the closing date. Green Cards are issued, and state inspections therefore take place, every five years. Bulk Sales New Jersey has a bulk sales law which imposes on purchasers an obligation to notify the New Jersey Department of Treasury, Division of Taxa - tion (“Division”) of any transaction involving the transfer of business assets outside the ordinary course of business of the owners. The purpose
is to identify and capture the taxes owed by the owner before sales proceeds are distributed from the closing of the transaction. Failure to comply with the bulk sales law could render a purchaser liable for a seller’s outstanding state tax obligations. The bulk sale notification process is as follows: the purchaser first submits a Form C-9600 which must be properly completed and include the fol - lowing: (i) a valid New Jersey tax ID number for the seller and purchaser, (ii) the specific closing date, which must be at least ten business days after submission, (iii) a proper mailing address for each of the parties and/or their respective legal counsel, (iv) the signature of the purchaser or the purchaser’s attorney, and (v) a copy of the executed contract of sale, court order, or assign - ment agreement clearly showing the sales price and all the terms and conditions of the transfer. Often, the purchase and sale agreement requires that all of the above information be provided in a timely manner so as not to delay the purchaser’s bulk sale filing. In addition, if required by the Divi - sion, the seller submits a Transfer Tax Declara - tion form to the Division. The Division generally promises a response within ten business days of the submission of a complete filing, at which time the Division will either issue a tax clear - ance letter, directions for an escrow of a por - tion of the seller’s proceeds, or a demand letter. If the Division fails to respond to a completed bulk sale notification within ten business days, the purchaser will not be liable for any state tax obligation of the seller. The purchase and sale agreement also will typically provide that both parties agree to comply with the instructions of the Division. Certificates of Occupancy There are over 500 municipalities in New Jersey, and each has its own ordinance with respect to
1221 CHAMBERS.COM
Powered by FlippingBook