BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1267|
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THIRD READING
Bill No: AB 1267
Author: Bloom (D)
Amended: 4/27/15 in Assembly
Vote: 21
SENATE JUDICIARY COMMITTEE: 7-0, 6/16/15
AYES: Jackson, Moorlach, Anderson, Hertzberg, Leno, Monning,
Wieckowski
ASSEMBLY FLOOR: 76-0, 5/7/15 - See last page for vote
SUBJECT: Lawsuits, liens, and other encumbrances
SOURCE: Anti-Defamation League
DIGEST: This bill prohibits a person from filing or recording a
lawsuit, lien, or other encumbrance against any person or
entity, knowing that it is false, with the intent to harass the
person or entity or, in the case of a public officer or
employee, to influence or hinder the person in discharging his
or her official duties. This bill authorizes a court to issue a
civil penalty not to exceed $5,000 for violating the
prohibition, and allows any person or entity subject to a lien
or other encumbrance filed or recorded in violation of the
prohibition to petition the superior court for an order
directing the claimant to show cause why the lien or other
encumbrance should not be stricken and other relief should not
be granted.
ANALYSIS: Existing federal law provides that whoever files,
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attempts to file, or conspires to file, in any public record or
in any private record which is generally available to the
public, any false lien or encumbrance against the real or
personal property of an officer or employee of the United States
or of any agency in any branch of the United States Government,
as specified, on account of the performance of official duties
by that individual, knowing or having reason to know that such
lien or encumbrance is false or contains any materially false,
fictitious, or fraudulent statement or representation, shall be
fined or imprisoned for not more than 10 years, or both. (18
U.S.C. Sec. 1521.)
Existing state law:
1)Provides that every person who knowingly procures or offers
any false or forged instrument to be filed, registered, or
recorded in any public office within this state, which
instrument, if genuine, might be filed, registered, or
recorded under any law of this state or of the United States,
is guilty of a felony. (Pen. Code. Sec. 115(a).)
2)Authorizes the awarding of sanctions against a party who, when
filing a pleading, petition, written notice of motion, or
other similar paper with a court, falsely certifies that,
among other things, the filing is not being presented
primarily for an improper purpose, such as to harass or to
cause unnecessary delay or needless increase in the cost of
litigation. (Code Civ. Proc. Sec. 128.7.)
3)Provides that a county recorder shall not refuse to record any
instrument, paper, or notice that is authorized or required by
statute, court order, or local ordinance that relates to the
recordation of any instrument, paper, or notice that relates
to real property to be recorded on the basis of its lack of
legal sufficiency. (Gov. Code Sec. 27201(a).)
4)States that no person shall file or record a lawsuit, lien, or
other encumbrance, including, but not limited to, a notice of
lis pendens, against a public officer or employee, knowing it
is false, with the intent to harass the officer or employee or
to influence or hinder the public officer or employee in
discharging his or her official duties. Existing law
specifies that this prohibition applies only to lawsuits,
liens, or other encumbrances pertaining to actions that arise
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in the course and scope of the public officer's or employee's
duties, and that a person who knowingly records or files, or
directs another to record or file, a lawsuit, lien, or
encumbrance in violation of this prohibition shall be liable
for a civil penalty not to exceed $5,000. (Gov. Code Sec.
6223.)
5)Provides that a public officer or employee whose property is
subject to a lien or other encumbrance in violation of the
above provision may petition the superior court of the county
in which the person resides or in which the property is
located for an order, which may be granted ex parte, directing
the lien or other encumbrance claimant to appear at a hearing
before the court and show cause why the lien or other
encumbrance should not be stricken and other relief should not
be granted, as specified. Existing law states that the court
shall schedule the hearing no earlier than 14 days after the
date of the order. (Code Civ. Proc. Sec. 765.010.)
6)Provides that if the court determines that the lien or other
encumbrance is in violation of the above prohibition, the
court shall issue an order striking and releasing the lien or
other encumbrance and may award costs and reasonable attorney
fees to the petitioner to be paid by the lien or other
encumbrance claimant. Existing law states that if the court
determines that the lien or other encumbrance is valid, the
court shall issue an order so stating and may award costs and
reasonable attorney fees to the encumbrance claimant to be
paid by the petitioner. (Code Civ. Proc. Sec. 765.030.)
7)Provides that any lien or encumbrance claimant who records or
files, or directs another to record or file, a lien or other
encumbrance in violation of the above prohibition shall be
liable to the owner of the property bound by the lien or other
encumbrance for a civil penalty of up to $5,000. (Code Civ.
Proc. Sec. 765.040.)
8)States that if a lien or other encumbrance is recorded or
filed in violation of the above prohibition, the state or
local agency that employs the public officer or employee may
provide counsel for the public officer or employee in an
action brought under these procedures. (Code Civ. Proc. Sec.
765.060.)
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This bill:
1)Recasts and expands the above provisions to state that a
person shall not file or record, or direct another to file or
record, a lawsuit, lien, or other encumbrance, including a
notice of lis pendens, against another person or entity
knowing it is false, with the intent to harass the person or
entity or to influence or hinder the person in discharging his
or her official duties if the person is a public officer or
employee.
2)Provides that a person or entity whose property is subject to
a lien or encumbrance in violation of the above provision may
petition the superior court of the county in which the person
or entity resides or in which the property is located for an
order, which may be granted ex parte, directing the lien or
other encumbrance claimant to appear at a hearing before the
court and show cause why the lien or other encumbrance should
not be stricken and other specified relief should not be
granted.
3)Specifies that the court shall schedule the hearing no earlier
than 14 days after the date of the order, and that the
scheduled date of the hearing shall allow adequate time for
notice of the hearing.
4)Defines "harass" to mean engaging in knowing and willful
conduct that serves no legitimate purpose, and "entity" to
mean both government and private entities.
5)Makes other technical and conforming changes.
Background
According to a report by the Senate Office of Research from
September of 1997, anti-government extremists are engaging in
"paper terrorism" by filing false liens and other encumbrances
on the property of government agencies, public officers, and
public employees. One anti-government ideology in particular -
known as the "sovereign citizen" movement - employs this tactic
frequently as a way to retaliate against perceived injustices.
A recent New York Times article states:
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Sovereign citizens believe that in the 1800s, the federal
government was gradually subverted and replaced by an
illegitimate government. They create their own driver's
licenses and include their thumbprints on documents to
distinguish their flesh and blood person from a "straw man"
persona that they say has been created by the false
government. When writing their names, they often add
punctuation marks like colons or hyphens. Adherents to the
movement have been involved in a host of debt evasion schemes
and mortgage and tax frauds. (Erica Goode, In Paper War,
Flood of Liens Is the Weapon, New York Times (Aug. 23, 2013)
[as of
June 10, 2015].)
In 1998, the Legislature passed SB 1759 (Ayala, Chapter 779,
Statutes of 1998) and SB 2154 (Schiff, Chapter 211, Statutes of
1998), which specifically prohibited the filing of false liens,
encumbrances, or lawsuits against public officials with the
intent to harass them or hinder the discharge of their duties.
These bills also enacted a fast-track process by which public
officials could petition the superior court for an order
directing the claimant to show cause why their lien or other
encumbrance should not be stricken, and to receive a hearing on
the court's show cause order no earlier than 14 days.
This bill expands and recasts the prohibition on filing false
liens, encumbrances, or lawsuits to include all persons or
entities, and expands the fast-track process to allow any
aggrieved party against whom these false lawsuits, liens, or
other encumbrances have been filed to receive a hearing before a
court no earlier than 14 days of the court issuing a show cause
order.
Comments
The author writes:
The sovereign citizen movement is an extreme anti-government
movement whose members believe our government has no authority
or jurisdiction over them and that they do not need to obey
its laws and regulations. The movement dates back to 1970 but
has had a surge of popularity since 2009, accompanied by a
wide range of criminal activity that includes violence, scams
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and frauds.
One of the most popular sovereign citizen tactics is known as
paper terrorism, which refers to the use of bogus legal
documents and filings, or the misuse of legitimate ones, in
order to intimidate, harass, threaten, or retaliate against
public officials, law enforcement officers, or private
individuals. Acts of paper terrorism can range from simple
and straightforward filings, such as frivolous lawsuits, to
more complex strategies, such as filing IRS forms that
fraudulently allege victims have been paid large sums of money
on which they declared no taxes. The most popular paper
terrorism tactic is the use of bogus liens or other documents
to cloud title to property owned by victims. Whatever the
ploy, the result creates serious legal and financial problems
for those targeted.
The goal of AB 1267 is to further protect Californians from
paper terrorism by strengthening already existing laws.
California law already protects public officers and employees
who are targeted by these false encumbrances by allowing them
to utilize a fast track removal process. AB 1267 extends such
protection to individuals and businesses so they may all use
this expedient process. When public officers and employees
are targeted by a false encumbrance, they are entitled to seek
civil remedies (up to $5000). AB 1267 permits individuals and
businesses to also pursue these remedies.
The sponsor, Anti-Defamation League (ADL), states:
Although the ADL is encouraged by the positive steps the State
of California has already taken to fortify existing paper
terrorism protections, there is more to do. For instance,
California currently provides a fast track removal process and
civil remedies for false filings. These code sections,
however, only apply to public officers and employees, while
sovereign citizens also target others. AB 1267 expands these
protections to individuals - including the spouses and
relatives of public officers, as well as private citizens and
businesses. This bill will bring California in line with the
ten states that currently provide a fast track removal process
to individuals and businesses, and the twenty-five states that
provide civil remedies for false filings.
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Related/Prior Legislation
SB 346 (Dutton, 2007) would have prohibited a person from filing
a lien or other encumbrance without providing evidence to a
recording clerk of the pendency of an action or the issuance of
a judgment upon which the lien is based, and would have required
the Secretary of State to revise the Uniform Commercial Code
Financing Statement (UCC-1) to require a lien claimant to attach
documentation sufficient to provide evidence of the pendency of
an action or the issuance of a judgment upon which the lien is
based, as specified. The bill died in the Senate Judiciary
Committee.
SB 1759 (Ayala, Chapter 779, Statutes of 1998) modified the
prohibitions enacted in SB 2154 (Schiff, Chapter 211, Statutes
of 1998) to specify that an encumbrance includes, but is not
limited to, a notice of lis pendens, and created an expedited
action, filed pursuant to a complaint form established by the
Judicial Council, requesting the striking or release of a lien
or other encumbrance recorded in violation of those
prohibitions. The bill also prohibited consumer credit
reporting agencies from reporting a document which acts as a
lien or other encumbrance but which has together with it a court
order striking or releasing the lien or other encumbrance, as
specified.
SB 2154 (Schiff, Chapter 211, Statutes of 1998) prohibited a
person from filing a lawsuit or recording or filing a lien or
other encumbrance, against a public officer or employee, knowing
it is false, with the intent to harass the officer or employee
or influence or hinder the public officer or employee in
discharging his or her official duties. The bill specified that
the above provision would apply only to lawsuits, liens, or
other encumbrances pertaining to actions that arise in the
course and scope of the public officer's or employee's duties,
and provided that a person who violates these provisions would
be liable for a civil penalty not to exceed $5,000.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:NoLocal: No
SUPPORT: (Verified6/16/15)
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Anti-Defamation League (source)
California District Attorneys Association
California Police Chiefs Association
California State Association of Counties Excess Insurance
Authority
OPPOSITION: (Verified6/16/15)
None received
ASSEMBLY FLOOR: 76-0, 5/7/15
AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Chang, Chau,
Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly,
Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Grove, Hadley, Harper, Holden, Irwin, Jones, Jones-Sawyer,
Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis,
Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte,
O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon,
Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone,
Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood,
Atkins
NO VOTE RECORDED: Campos, Dodd, Roger Hernández, Steinorth
Prepared by:Tobias Halvarson / JUD. / (916) 651-4113
6/19/15 14:48:04
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