7-17-6 - Liability of lender for failure to pay taxes, insurance premiums, or other charges.
7-17-6. Liability of lender for failure to pay taxes, insurance premiums, or othercharges.
A lender administering a reserve account shall make timely payments of taxes, insurancepremiums and other charges for which the account is established, if funds paid into the accountby the borrower, his successors or assigns, are sufficient for the payments. Negligent failure tomake the payments required for taxes, insurance premiums and other charges as they becomedue, from available funds in the reserve account, shall subject the lender to liability for alldamages directly resulting from the failure; provided that this sentence does not deprive thelender of the right to present any defense it may have in any action brought to enforce theliability. Failure of the borrower or his successors or assigns to deliver promptly to the lender allnotices of tax assessments and insurance premiums or other charges, received by the borrower,his successors or assigns, shall relieve the lender from liability under this section.
Amended by Chapter 378, 2010 General Session