§ 3406. Purchaser's right to cancel.
(a) General rule.--In cases where delivery of a public offering statement is required under section 3401 (relating to applicability; waiver), a declarant shall provide a purchaser of a unit with a copy of the public offering statement and all amendments thereto not later than the date the purchaser executes the contract of sale for such unit or, if no contract of sale is executed, 15 days before conveyance of such unit. Unless a purchaser is given the public offering statement, including all the currently effective amendments thereof, within the time period referred to in the preceding sentence, the purchaser, before conveyance, may cancel the contract within 15 days after first receiving the public offering statement and all currently effective amendments thereof, except in the case of the sale of a time-share estate. Unless a purchaser of a time-share estate is given the public offering statement, including all the currently effective amendments thereof, more than seven days before the purchaser executes the contract for the purchase of such unit or, if no contract of sale is executed, seven days before conveyance of such unit, the purchaser, before conveyance, may cancel the contract within seven days after first receiving the public offering statement and all currently effective amendments thereof. If a public offering statement is amended after the public offering statement has been received by a purchaser of a unit, the amendment shall be provided to the purchaser promptly after it becomes effective, and, if the amendment materially and adversely affects the rights or obligations, or both, of the purchaser, then the purchaser, before conveyance, may cancel the contract of sale within 15 days, or seven days in case of the sale of a time-share estate, after receiving the amendment.
(b) Method and effect of cancellation.--If a purchaser elects to cancel a contract pursuant to subsection (a), he may do so by hand delivering notice thereof to the declarant, or by mailing notice thereof by prepaid United States mail to the declarant or to his agent for service of process. Cancellation is without penalty and all payments made by the purchaser before cancellation shall be refunded promptly.
(c) Penalty for noncompliance by declarant.--If a declarant fails to provide a purchaser to whom a unit is conveyed with a public offering statement and all amendments thereto as required by subsection (a), the purchaser, in addition to any other relief, is entitled to receive from the declarant an amount equal to 5% of the sales price of the unit up to the maximum of $2,000, or actual damages, whichever is the greater amount. A minor omission or error in the public offering statement or an amendment thereto, that is not willful, shall entitle the purchaser to recover only actual damages, if any.
(Dec. 18, 1992, P.L.1279, No.168, eff. 45 days)
Cross References. Section 3406 is referred to in sections 3402, 3403 of this title.
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