Sec. 56. (a) In a foreclosure action under this chapter, other than a foreclosure action in which the unit is the plaintiff, the plaintiff must do the following:
(1) Name the officer who has custody of the improvement funds of the unit as a party defendant.
(2) Name that officer as custodian of the improvement assessment fund of the unit.
(b) The officer described in subsection (a) shall then notify the attorney of the unit to appear in the action.
(c) The fiscal officer of the unit shall do the following:
(1) Trace the proceeds of the foreclosure so that proceeds arising from assessments for the improvement of a particular project are not diverted to the payment of any other improvement.
(2) Ensure that in each case the judgment proceeds constitute a special fund for the payment of contractors or bondholders for the particular work.
(d) The judgment proceeds shall be allocated to the proper public improvement fund for pro rata distribution to the bondholders or contractors who are entitled to those proceeds.
As added by P.L.98-1993, SEC.7.
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