BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1974


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1974 (Gallagher)


          As Amended  August 19, 2016


          Majority vote


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          |ASSEMBLY:  |79-0  |(May 5, 2016)  |SENATE: |39-0  |(August 23,      |
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          Original Committee Reference:  L. GOV.


          SUMMARY:  Establishes procedures for the re-recording of  
          recorded documents.  


          The Senate amendments revise and recast the provisions of the  
          bill to provide for a more comprehensive procedure for  
          re-recording documents and to specify documents that are exempt  
          from this procedure but are, instead, subject to more limited  
          requirements.


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee, pursuant to Senate Rule 28.8, negligible state costs.


          COMMENTS:  










                                                                    AB 1974


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          1)Bill Summary.  This bill establishes procedures for the  
            re-recording of recorded documents.  The bill 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 existing law; 


             b)   The document is presented solely to correct a recording  
               sequence; or,


             c)   The document is presented solely to make a minor  
               correction.  


            This bill specifies, pursuant to b), above, that the intent of  
            the parties with regard to the priority of recorded documents  
            shall be controlling regardless of the sequence of recording  
            by a county recorder or the sequence of recording specified in  
            instructions given by a submitter to a county recorder.  This  
            provision is declaratory of existing law, and any re-recording  
            of documents to change the sequential numbers assigned to a  
            document by the recorder shall not require the document to be  
            executed and acknowledged or verified as a new document.


            A document presented solely to make a minor correction must be  
            accompanied by a corrective affidavit, which must be attached  
            to the original recorded instrument, paper, or notice; set out  
            the information corrected; be certified by the party  
            submitting the affidavit under penalty of perjury; and, be  
            acknowledged pursuant to existing law.


            The bill defines "minor correction" to include any of the  
            following:










                                                                    AB 1974


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             a)   An incorrect or missing address of the party to which  
               the instrument, paper, or notice is to be returned  
               following recording pursuant to existing law;


             b)   A clarification of illegible text pursuant to existing  
               law;


             c)   An incorrect or missing printed or typed name of an  
               individual or entity near the signature pursuant to  
               existing law; or,


             d)   An incorrect or missing documentary transfer tax amount  
               due pursuant to existing law.


            This bill requires each re-recorded instrument, paper, or  
            notice to include a cover sheet that complies with existing  
            law governing the format of documents submitted for recording  
            and states the reason for re-recording.  This bill makes  
            conforming changes to existing law, and provides that no  
            reimbursement is required by the bill.


            This bill is sponsored by the County Recorders Association of  
            California.


          1)Author's Statement.  According to the author, "Under current  
            law, there is no codified way to re-record documents in county  
            recorder offices.  This bill would set a standard procedure  
            for re-recording documents.  This bill will ensure records  
            remain accurate when being re-recorded and will help in  
            keeping local government efficient."


          2)Background.  County recorders are responsible generally for  
            examining and recording all documents that deal with  
            establishing ownership of land in counties.  This includes the  
            recording of title documents, notes, and home loan payoffs by  








                                                                    AB 1974


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            homeowners, title companies, mortgage companies and government  
            agencies involved in real estate transactions.  


            Documents such as deeds, loan documents, easements, power of  
            attorney, liens, and other documents which affect title to or  
            possession of real property need to be re-recorded when there  
            is an error in a previously recorded document or there needs  
            to be a change in name or other details.  There is no formal  
            procedure in statute to re-record documents.  According to the  
            County Recorders Association of California, sponsor of this  
            measure, county recorders each have their own procedure, which  
            creates uncertainty over the accuracy and correct procedure  
            for re-recording.  


          3)Arguments in Support.  The County Recorders Association of  
            California, sponsor of this measure, writes, "AB 1974 would  
            create a formal procedure for re-recording documents.  This  
            will end consumer confusion when fixing errors in previously  
            recorded documents."


          4)Arguments in Opposition.  None on file.


          Analysis Prepared by:                                             
                          Angela Mapp / L. GOV. / (916) 319-3958  FN:  
          0004776