Some may try to argue that the prohibition against the manufacture of noncompliant manufactured homes is encompassed in the manufacturer’s certification of compliance with the MHCSS. Even in the absence of the express prohibition in 42 USCA §5409(a)(1), this would still be strongly implied under the MHCSS Act, but under the Secretary’s regulation, its not even implied weakly. The Secretary never says that a manufacturer that issues a certification of conformance with all applicable MHCSS, which is false or misleading in a material respect, is a violation of his regulations. In fact, the Secretary knowingly and willfully authorizes the manufacture of nonconforming or statutorily illegal manufactured homes under his AC process, and knowingly and willfully authorizes the manufacturer’s to issue false or misleading (fraudulent) certifications for such statutorily illegal manufactured homes. This is necessary in order for his manufacturers to terminate his contrived “prohibition of sale,” thereby, protecting the provision(s) of any contract or agreement for the sale of such statutorily illegal manufactured home.

Unlike the dealers and distributors who are expressly prohibited by him from selling nonconforming manufactured homes, unless the manufacturer has labeled the nonconforming manufactured home (emphasis added), there is not one single instance in his regulations where the Secretary expresses, or even strongly implies that a manufacturer is prohibited from doing anything whatsoever.

If law does not prohibit an action can a person later be held accountable for taking such an action? If it is implied strongly enough that something should not have been done, then it is possible, but implied violation(s) are significantly more complicated and costly to prosecute, and the outcome is less certain. This ambiguity also creates administrative discretion where none otherwise exists. It is fair to say that in the Secretary’s regulations it is not even strongly implied that manufacturers should not do something. Whereas under the MHCSS Act, there would be no question:

However, if such violation of 42 USCA §5409(a)(1) was unintentional, as evidenced by the manufacturer’s compliance in “good faith” with 42 USCA §5414, such punishment could be waived. It should also be noted that failure by the manufacturer to issue the notification of any defects to the purchaser, containing the information prescribed by Congress under 42 USCA §5414, is a violation of 42 USCA §5409(a)(3), which punishment thereof under 42 USCA §5410 is mandatory, and not discretionary as the Secretary pretends. Then, this is probably just another case where the Secretary is “merely exercising [his] prosecutorial discretion” in authorizing the manufactured home manufacturers to commit offenses against the people of these United States. “This enforcement mechanism is often called the no action approach” [HUD Manufactured Housing and Standards Division, Elizabeth Cocke, August 31, 2001]

The Secretary mentions in 24 CFR 3282.252(b) that his prohibition is effectual until all goods and services contracted for, have been ‘delivered’ to the purchaser by the dealer.

This is irrelevant to the manufacturer’s manufactured home in so much as the Secretary’s prohibition is inapplicable to any manufactured home that has been labeled by the manufacturer; more of his misdirection.

There are only two conditions that can revive his prohibition of sale after the manufacturer affixes his or her label of compliance to the home.

However, if such has already been ‘delivered’ to the purchaser, then the problem is not his or his manufacturers, regardless of what they may or may not have known prior to the completion of the sale to the purchaser (emphasis added) [1].

With this said, the Secretary does not take any enforcement action against dealers who ‘deliver’ manufactured homes to purchasers that have incurred transit damage; but then, once it is ‘delivered’ to the purchaser it is no longer his or his manufacturers problem.

The Secretary has contrived a clever quasi statute of limitations for his regulations, which ends the force and effect of all implied or expressed prohibitions once the manufacturers and their agents successfully ‘deliver’ (at the dealer lot or prior to setup/installation) their overtly defective, but labeled as not, merchandise to the purchaser [2].

Whereas under the MHCSS, the force and effect of 42 USCA 5409(a)(1) is applicable to any manufactured home until such time as such is sold or offered for sale by the first purchaser (emphasis added), and is enforceable at any time during this period if such manufactured home is found to contain any “error in the design or assembly of the manufactured home by the manufacturer” (42 USCA §5414(g)(2)). Hence, the delivery of defective or noncompliant merchandise to a consumer does not excuse, waiver, or invalidate the defective nature of the manufactured home, as it does under the Secretary’s regulations.

“Delivery” is a term that needs to be better understood before moving on because of its relationship to ‘acceptance’. Anyone who has purchased a new automobile can remember the dealer having you do an acceptance inspection of the new car you purchased. Upon completion of the inspection, if the purchaser accepts the automobile, they have taken “delivery” of their purchase, leaving them only the remedies available under the manufacturer’s warranty if something henceforth is found or goes wrong.

It is an industry wide practice for dealers of the manufacturer’s manufactured homes to insist that the purchaser perform an acceptance inspection at the dealer lot or before setup/installation, of the incomplete or uninhabitable manufactured home, and with few exceptions, the purchaser agrees to this request. This is because the industry standard practice is to misrepresent the nature of the dealer lot or pre-assembly inspection by assuring the purchaser that they will perform a final inspection, after the setup/installation of their purchase at the home site.

The vast majority of purchasers are completely unaware of the significance of the manufacturer’s disclaimer of all implied warranties. By ‘accepting’ the parts of the manufactured home they purchased, they have taken delivery of the manufacturer’s merchandise (emphasis added) “as is” or agreed that the parts for the manufactured home before them are as promised in the provision(s) of the contract for the purchase of the manufacturers merchandise. From henceforth, whether the product it is fit for the ordinary use for which it was intended or is “durable, livable, and safe housing” (24 CFR 3280.303(b)) is entirely the purchaser’s problem. The purchasers’ common misunderstanding of the nature of the dealer lot or pre-assembly inspection gives rise to purchasers that are bewildered over why their lender released the full payment for the manufacturer’s merchandise, before the manufacturer’s merchandise was completed, and they had conducted the promised final inspection.

This misunderstanding leads to angry purchasers seeking changes to lending law that can have no reasonable effect on sales contracts formed by parties outside of the lender’s purview; hence, they seek laws that will do little to protect the purchasers of manufactured homes from the root evil. This acceptance, unbeknownst to the purchaser, leaves them with only the remedies that the manufacturer agrees or volunteers to provide under their written warranty; are so the manufacturers’ argument goes (emphasis added).

However, the alleged remedies under these manufacturers’ product warranties are predicated on the purchaser or the purchaser’s skill/knowledge in setting up or assembling the parts of the manufacturer’s manufactured home, leastwise according to the manufacturers, into a product that is fit for the ordinary use for which the manufacturer intended and marketed their product to the purchaser – as a home. This is the reason that manufacturer warranties are as useless as the paper they are written – the manufacturers have an all inclusive scapegoat for anything major, such as anything that is not legitimately a cosmetic defect, that can go wrong with the substandard product they produced and delivered to the purchaser.

The manufacturers in every setup/installation manual for their product overtly state this fact, although a purchaser would not be aware of this since it is rare that they see such a manual before moving into their home. The manufacturers as an industry standard practice, write their setup/installation manuals from the perspective that they are instructing the purchaser on how to assemble what they purchased from the manufacturer, which is not a home, but parts or components that are unfit for that ordinary use. Moreover, they allege in their installation/setup manuals that the unqualified purchaser was fully aware from the onset that they were wholly responsible for performing or overseeing the final assembly of the parts or components that they purchased from the manufacturer. Hence, it is the purchaser, they allege, that is responsible for making the manufacturer’s product fit for the ordinary use for which the manufacturer marketed, manufactured, and then sold as a home, “home” being the operative word.

The fact the dealer has agreed to handle the setup/installation of the components has no relationship to the separate provision of the contract for the purchase of the manufacturer’s manufactured home. The Secretary says “Completion of a retail sale will be at the time the dealer completes set-up of the manufactured home if the dealer has agreed to provide the set-up” (24 CFR 3282.252(b)). As already conveyed, and as will be overtly apparent later, this is more of his meaningless misdirection.

The industry standard catchall phrase in their setup/installation manuals – “Failure to follow these instructions can void your warranty” – failure by whom, failure by the purchaser. The manufacturer’s installation instructions are riddled with written warranty conditions that the purchaser must meet (emphasis added) to prevent voiding the manufacturer’s (already largely meaningless) written warranty, which as noted, the setup/installation manuals are withheld from the consumers until its too late. The manufacturer’s deliberate failure to deliver such warranty conditions in a written, clear, and conspicuous manner before formalizing any agreement, for the purchase of their product is a clear violation of the Magnus and Moss Federal Warranty Act (emphasis added).

42 USCA §5421 is only enforceable so long as 42 USCA §5409(a)(1) is enforceable, and §5421 is only applicable after the completion of the sale of a manufactured home to a purchaser. Hence, the primary tool for leveraging the purchaser’s right to a manufactured home that complies with all applicable MHCSS from the manufacturers – 42 USCA §5421 – is meaningless because of the Secretary’s contrived quasi statute of limitations. Even if it was argued that such prohibition of sale does not terminate upon labeling, there is zero doubt under the Secretary’s regulations that it forevermore terminates upon “delivery” to the purchaser. Hence, even if the Secretary did bother to implement 42 USCA §5421, it would still be meaningless or broken under his regulations because of his cleverly contrived quasi statute of limitations in his “Prohibition of Sale.”

As stated earlier, the Secretary’s regulatory objective is clear and simple – to circumvent the force and effect of 42 USCA §5421 to protect the provisions of the agreement (contract) for the sale of nonconforming or statutorily illegal manufactured homes.

This conclusion is consistent with his notion that his AC process is permissible, where thereunder he authorizes the manufacture for sale of nonconforming or statutorily illegal manufactured homes (emphasis added).

The Secretary provides a better explanation for what is meant by “does not know” in his regulation that follows, which is titled “removal of prohibition of sale.” The reason this section provides a better explanation is that the content of section (a) of his “removal of prohibition of sale” is consistent with a “prohibition of sale.” In 24 CFR 3282.253, the Secretary states in subsection (a):

Subsection (a) of his regulation is a reason to prohibit the sale, and not a reason to remove the prohibition to sale. However, what is important here is “acting as a reasonable distributor or dealer, knows as a result of notification by the manufacturer or otherwise”.

This defines the scope of what the Secretary means by, “acting as a reasonable distributor or dealer.” A distributor or dealer is acting as a reasonable distributor or dealer under his regulations, so long as they keep their heads buried in the sand. If the manufacturer notifies them that such manufactured home does not comply with the MHCSS, then in this case they can no longer keep head buried in sand. What about “or otherwise”?

It would be unreasonable to require a person to have a B.S. Degree in Engineering or Architecture or an equivalent education, as a condition for selling manufactured homes. Moreover, the manufacturers would be hard pressed to find even a few persons with such education or background that would be willing to give up the pay and security of a job consistent with their education, to sell manufactured homes, leastwise, as a full time occupation. Hence, the vast majority of sales persons do not come pre-equipped with the knowledge to inspect designs and construction, to determine whether a manufactured home complies with all applicable MHCSS (emphasis added). Moreover, the manufacturers are not going to give such designs or records to dealers they allege to be independent of their control.

Of equal importance, manufactured homes arrive at the dealer lot with most structural, electrical, heating, and plumbing systems no longer visible for inspection. In the words of Congressman Frey (R-FL), one of the leading forces in the House of Representative for the enactment of the MHCSS Act of 1974:

Simply stated, “otherwise” encompasses a narrow field, and this would be true even if dealer lot inspections were made in good faith by qualified individuals. Under the Secretary’s regulations “otherwise” encompasses such a narrow field that it is virtually nonexistent, so bury head in sand is the modus operandi that is encouraged by the Secretary’s for dealers and distributors under his regulations.

For “otherwise” to be anything beyond a sand box for the dealers and distributors to bury their heads in, the Secretary, as expressly authorized by 42 USCA §5407 [4], would have to train or educate the dealers and distributors to inspect manufactured homes, to the extent feasible at the dealer lot, for compliance with the MHCSS. His regulations are completely void of any such training requirements, either by him or by the manufacturers, hence, dealers or distributors are not persons under his regulations (emphasis added) that have reason to know, beyond the manufacturer’s label of compliance, “that such manufactured home does not so conform” (42 USCA §5409(b)(2)).

The Secretary’s “prohibition of sale” actually conveys the insanity of his regulations. He has taken the least qualified (at least the vast majority), and without establishing any training programs for them, made them ultimately responsible for ensuring compliance at a point, where even if they were trained or qualified, they would be largely unable to determine compliance with all applicable MHCSS. It is supposed that they could disassemble the manufacturer’s manufactured home for a complete inspection, but then if this is necessary, what purpose do the manufacturers serve.

The Secretary left “otherwise” purposely ambiguous, thereby making it virtually impossible to hold any dealer or distributor accountable for selling nonconforming manufactured homes, that is, if his exclusive system of regulation failed to prevent the discovery thereof.

As stated, under the Secretary’s regulation the manufacturers terminate the force and effect of the Secretary’s “prohibition of sale” for such dealers or distributors, which is consistent with the Secretary’s, bury head in sand or do nothing approach to the enforcement of the MHCSS Act. With no explanation or evidence affronted regarding whether the manufacturer’s issuance of a false certification of conformance with the MHCSS constitutes a violation of his regulations, the Secretary has proffered an environment founded on ignorance and even in the absence of ignorance, rich in quid pro quo for anyone willing to put the amount of their profit first.

In the light of 42 USCA §5412, which the Secretary did implement as intended by Congress, with few contrived modifications, it should be obvious that it would NOT be to his manufacturers benefit for the allegedly independent dealers to know what does or does not conform to the MHCSS, and be held accountable, to the extent feasible for failing to ensure compliance therewith.

Moreover, even though implemented, the Secretary has made it highly unlikely that a dealer will demand remedy for defective products delivered to them by the manufacturer. This is because the Secretary did not implement Congress’s requirement that the “manufacturer has a contractual, proprietary, or other legal relationship” …“and”… “in a manner determined by the Secretary to be appropriate” … “with the person at each location where any such manufacturer's manufactured homes are offered for sale” (42 USCA §5413(g)(1)). An appropriate provision of such a franchise agreement would give the dealer(s) additional recourse, should the manufacturer retaliate against a dealer for seeking the remedies available to them under 42 USCA §5412.

1
Inspections by NCSBCS of manufactured homes at dealer locations in Arizona provides’ case and point. A large number of violations were discovered in each home inspected, no action was taken by the Secretary against the manufacturer, and the Secretary with knowledge and forethought, to satisfy the partialities and corruptions of industry leaders, disregarded the findings and permitted the sale of such defective or noncompliant merchandise to an unaware public.

2
Manufactured homes are so overtly defective that it seems to escape the rational thought of most people that what the manufacturers produce and market as a home fit for that ordinary use, is unfit for that ordinary use until it has been completed at the home site. Can ANYONE recall watching any television advertisement for any brand name manufactured home, for example, such as Palm Harbor or Fleetwood, in which Palm Harbor or Fleetwood depicts the product they manufacture as anything other than a fully assembled home that is ready for anyone who purchases their product, to move-into!!!

3
Note: The Commonwealth of Pennsylvania has taken the initiative to train dealers, within the limits imposed by after the fact, how to inspect for and identify failures to comply. This removes the extent to which the dealers can bury their heads in the sand and pretend nothing is wrong. While an improvement to varying degrees over the remaining 49 States, “After the fact” still significantly limits the discovery of manufacturing defects, and this is especially true for design and/or latent defects. Pennsylvania compensates for this obvious shortcoming by enforcing the performance requirements (applicable until the time specified in §5409(b)(1)) of the Federal Standards. However, while PA has some resources available to force in-state industry members to provide remedy, the ability to force out-of-state industry members to provide remedy remains largely in the Secretary’s contrived purview, which too often leaves the purchasers of such out of state products without remedy.

4
The authority to establish training requirements (42 USCA §5407 & §5413) and conduct training programs for dealers and distributors to address this serious and deliberate deficiency does exist under the MHCSS Act of 1974, and this authority was not undermined by the MHI Act of 2000.