BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1974|
|Office of Senate Floor Analyses | |
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THIRD READING
Bill No: AB 1974
Author: Gallagher (R)
Amended: 6/21/16 in Senate
Vote: 21
SENATE GOVERNANCE & FIN. COMMITTEE: 7-0, 6/15/16
AYES: Hertzberg, Nguyen, Beall, Hernandez, Lara, Moorlach,
Pavley
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
ASSEMBLY FLOOR: 79-0, 5/5/16 (Consent) - See last page for
vote
SUBJECT: County recorder: recordation of documents
SOURCE: County Recorders Association of California
DIGEST: This bill specifies procedures for the re-recording of
recorded documents.
ANALYSIS:
Existing law:
1)Establishes a recorder in each county that is responsible for
examining and recording all documents that deal with
establishing ownership of land in counties, such as title
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documents.
2)Prescribes procedures for the recording of documents,
specifically:
a) A document must be submitted to a county recorder along
with the necessary recordation fees.
b) If the document meets the requirements in statute or
local ordinance that apply to that type of document, the
recorder must record it.
c) The recording statutes specify in minute detail the form
and requirements that documents must meet.
3)Requires some recorded documents to be acknowledged-affirmed
by the parties to the transaction as their action-and allows
the recording of other documents to be done without
acknowledgement.
This bill:
1)Requires a document that is presented to a county recorder for
re-recording to be executed and acknowledged or verified as a
new document, unless any of the following apply:
a) The document is exempt from acknowledgement and
execution under current law,
b) The document is presented solely to correct a recording
sequence, or
c) The document is presented solely to make a minor
correction.
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2)Allows a document to be re-recorded without acknowledgement or
execution if the document is presented along with a corrective
affidavit that sets out the information corrected, is
certified by the party submitting the affidavit under penalty
of perjury, and is acknowledged by the person presenting it.
3)Defines minor corrections to include certain changes to
incorrect or missing names, an incorrect or missing amount of
tax due upon the recording of the document, or a clarification
of illegible text.
4)Requires the re-recorded document to include a cover sheet
that states the reason for re-recording.
Background
Recorded documents sometimes need to be re-recorded in order to
correct an error in a previously recorded document or to change
a name or other details. The County Recorders Association
estimates that annually about 3,500 documents in California are
re-recorded. There is no formal procedure to re-record
documents in statute, leading county recorders to establish
their own procedures for doing so that can vary across counties.
Some counties have allowed minor corrections to recorded
documents without requiring acknowledgement and execution of a
new document, while others require the document to be recorded
as if it were a new document. Entities such as mortgage
brokers, lenders, and escrow officers may do business in
multiple counties, so the County Recorders Association wants to
standardize this process across all counties.
Comments
1)Purpose of the bill. Recorded documents are used to inform
determinations of property rights and other legal matters.
But errors in recorded documents occasionally occur, and state
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law does not specify a process for re-recording documents in
order to correct those errors. This lack of a defined process
leads to potential uncertainty over the accuracy or veracity
of the re-recorded documents. In addition, lenders and other
entities that frequently record documents in multiple counties
face a lack of consistency across counties when trying to
correct errors in recorded documents. AB 1974 establishes a
standardized process for county recorders to follow when
re-recording documents and provides a streamlined process for
correcting minor errors, such as an incorrect name. This
streamlined process avoids the need to track down all parties
to a recorded document for a new acknowledgement and
execution, saving time and money. At the same time, AB 1974
includes a strong safeguard to ensure that this process is not
abused by requiring certification under penalty of perjury
that the information is true. AB 1974 is a commonsense fix to
provide a guarantee of accuracy by codifying practices that
many county recorders are already following.
2)Balancing act. The streamlined process in AB 1974 reduces the
time and money needed to make minor corrections, relative to
requiring the document to be re-recorded as new. But that
process only applies to a narrow set of circumstances, such as
an incorrect name. There are other corrections that this bill
does not authorize to be changed through the streamlined
process, such as corrections to parcel numbers, that are seen
as uncontroversial by some. In their view, completing an
entirely new recording for these changes could have
significant costs and could delay the ability of assessors to
promptly and correctly assess property. Others see the
potential for significant consequences if those changes are
fraudulently made. Historically, county recorders and county
counsels have followed the processes that they feel are
necessary to insure the integrity of recorded documents. It
is unclear whether this bill strikes the right balance between
guarding against fraud and expediting uncontroversial changes.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
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SUPPORT: (Verified8/3/16)
County Recorders Association of California (source)
California Land Surveyors Association
OPPOSITION: (Verified7/27/16)
California Land Title Association
ASSEMBLY FLOOR: 79-0, 5/5/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,
Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley,
Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier,
Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,
Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger
Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey,
Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes,
McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte,
O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez,
Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting,
Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NO VOTE RECORDED: Beth Gaines
Prepared by:Anton Favorini-Csorba / GOV. & F. / (916) 651-4119
8/3/16 18:54:27
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