California Legislature—2015–16 Regular Session

Assembly BillNo. 2143


Introduced by Assembly Member Irwin

February 17, 2016


An act to amend Sections 27391, 27393, and 27397.5 of the Government Code, relating to electronic recording.

LEGISLATIVE COUNSEL’S DIGEST

AB 2143, as introduced, Irwin. County recorder: electronic recording.

The Electronic Recording Delivery Act of 2004 authorizes a county recorder, upon approval by resolution of the board of supervisors and system certification by the Attorney General, to establish an electronic recording delivery system for the delivery for recording of specified digitized electronic records, subject to specified conditions. The act authorizes a county recorder to enter into a contract with specified entities for the delivery for recording, and return to the party requesting recording a digitized electronic record that is an instrument affecting a right, title, or interest in real property. The act also authorizes a county recorder to contract with the specified entities or their authorized agents to be an authorized submitter of a digital or digitized electronic record that is an instrument of reconveyance, substitution of trustee, or assignment of deed of trust.

The bill would authorize a county recorder to also enter into a contract with an authorized submitter for the delivery for recording, and return to the party requesting recording, of a digital or digitized electronic record that is an instrument to be recorded consistent with a specified provision, or for the submission of a digital or digitized electronic record. The bill would require an authorized submitter, as specified, and any agent submitting documents on behalf of an authorized submitter, to provide proof of financial responsibility in the form of general liability coverage, as provided.

Existing law requires the Attorney General, in consultation with interested parties, to adopt regulations for the review, approval, and oversight of electronic recording delivery systems. Existing law authorizes the regulations to include specified requirements and procedures.

This bill would additionally authorize the regulations to include requirements for general liability coverage as described above.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 27391 of the Government Code is
2amended to read:

3

27391.  

(a) Upon approval by resolution of the board of
4supervisors and system certification by the Attorney General, a
5county recorder may establish an electronic recording delivery
6system.

7(b) Upon system certification, a county recorder may enter into
8a contract with a title insurer, as defined in Section 12340.4 of the
9Insurance Code, underwritten title company, as defined in Section
1012340.5 of the Insurance Code, institutional lender, as defined in
11paragraph (1), (2), or (4) of subdivision (j) of Section 50003 of the
12Financial Code, or an entity of local, state, or federal government
13for the delivery for recording, and return to the party requesting
14recording, of abegin insert digital orend insert digitized electronic record that is an
15instrumentbegin delete affecting a right, title, or interest in real property.end deletebegin insert to be
16recorded consistent with subdivision (a) of Section 27201.end insert
The
17contract may provide for the delivery of documents by an agent.
18However, the agent shall not be a vendor of electronic recording
19delivery systems.

begin insert

20(c) (1) A county recorder may enter into a contract with an
21authorized submitter not authorized pursuant to subdivision (b)
22for the delivery for recording, and return to the party requesting
23recording, of a digital or digitized electronic record that is an
24instrument to be recorded consistent with subdivision (a) of Section
2527201. The contract may provide for the delivery of documents by
P3    1an agent. However, the agent shall not be a vendor of electronic
2recording delivery systems.

end insert
begin insert

3(2) An authorized submitter authorized pursuant to this
4subdivision and any agent submitting documents on behalf of an
5authorized submitter pursuant to this subdivision shall provide
6proof of financial responsibility by providing a certificate of
7insurance evidencing an amount of general liability coverage of
8at least one million dollars ($1,000,000).

end insert
begin delete

9(c)

end delete

10begin insert(d)end insert A county recorder may refuse to enter into a contract with
11any party or may terminate or suspend access to a system for any
12good faith reason, including, but not limited to, a determination
13by the county recorder that termination or suspension is necessary
14to protect the public interest, to protect the integrity of public
15records, or to protect homeowners from financial harm, or if the
16volume or quality of instruments submitted by the requester is not
17sufficient to warrant electronic recordation. A county recorder may
18also terminate or suspend access to a system if a party commits a
19substantive breach of the contract, the requirements of this article,
20or the regulations adopted pursuant to this article.

begin delete

21(d)

end delete

22begin insert(e)end insert Notwithstanding Section 27321, a county recorder may
23require a party electronically submitting records to mail a copy of
24the recorded electronic document to the address specified in the
25instructions for mailing upon completion of recording.

begin delete

26(e)

end delete

27begin insert(f)end insert When a signature is required to be accompanied by a notary’s
28seal or stamp, that requirement is satisfied if the electronic
29signature of the notary contains all of the following:

30(1) The name of the notary.

31(2) The words “Notary Public.”

32(3) The name of the county where the bond and oath of office
33of the notary are filed.

34(4) The sequential identification number assigned to the notary,
35if any.

36(5) The sequential identification number assigned to the
37manufacturer or vendor of the notary’s physical or electronic seal,
38if any.

39

SEC. 2.  

Section 27393 of the Government Code is amended
40to read:

P4    1

27393.  

(a) The Attorney General shall, in consultation with
2interested parties, adopt regulations for the review, approval, and
3oversight of electronic recording delivery systems. Regulations
4shall be adopted pursuant to the Administrative Procedure Act
5(Chapter 3.5 (commencing with Section 11340) of Part 1 of
6Division 3). The regulations shall comply with Section 12168.7.

7(b) The regulations adopted pursuant to subdivision (a) may
8include, but need not be limited to, all of the following:

9(1) Establishment of baseline technological and procedural
10specifications for electronic recording delivery systems.

11(2) Requirements for security, capacity, reliability, and
12uniformity.

13(3) Requirements as to the nature and frequency of computer
14security audits.

15(4) A statement of a detailed and uniform definition of the term
16“source code” consistent with paragraph (7) of subdivision (b) of
17Section 27390, and as used in this article, and applicable to each
18county’s electronic recording delivery system.

19(5) Requirements for placement of a copy of the operating
20system, source code, compilers, and all related software associated
21with each county’s electronic recording delivery system in an
22approved escrow facility prior to that system’s first use.

23(6) Requirements to ensure that substantive modifications to an
24operating system, compilers, related software, or source code are
25approved by the Attorney General.

26(7) Procedures for initial certification of vendors offering
27software and other services to counties for electronic recording
28delivery systems.

29(8) Requirements for system certification and for oversight of
30approved systems.

begin insert

31(9) Requirements for general liability coverage required by
32subdivision (c) of Section 27391.

end insert
begin delete

33(9)

end delete

34begin insert(10)end insert Requirements for fingerprinting and criminal records checks
35required by Section 27395, including a list of employment positions
36or classifications subject to criminal records checks under
37subdivision (f) of that section.

begin delete

38(10)

end delete

39begin insert(11)end insert Requirements for uniform index information that shall be
40included in every digitized or digital electronic record.

begin delete

P5    1(11)

end delete

2begin insert(12)end insert Requirements for protecting proprietary information
3accessed pursuant to subdivision (e) of Section 27394 from public
4disclosure.

begin delete

5(12)

end delete

6begin insert(13)end insert Requirements for certification under Section 27397.5.

7(c) The Attorney General may promulgate any other regulations
8necessary to fulfill his or her obligations under this article.

9(d) An electronic recording delivery system shall be subject to
10local inspection and review by the Attorney General. The Attorney
11General shall furnish a statement of any relevant findings
12associated with a local inspection of an electronic recording
13delivery system, to the county recorder and the district attorney of
14the affected county, and to all technology vendors associated with
15that system.

16

SEC. 3.  

Section 27397.5 of the Government Code is amended
17to read:

18

27397.5.  

(a) A county recorder may include in the county’s
19electronic recording delivery system a secure method for accepting
20for recording a digital or digitized electronicbegin delete record that is an
21instrument of reconveyance, substitution of trustee, or assignment
22of deed of trust.end delete
begin insert record.end insert

23(b) A county recorder may contract with begin delete a title insurer, as
24defined in Section 12340.4 of the Insurance Code, underwritten
25title company, as defined in Section 12340.5 of the Insurance Code,
26an entity of state, local, or federal government, or an institutional
27lender, as defined in Section 50003 of the Financial Code,end delete
begin insert an
28authorized submitterend insert
or their authorized agents, to be an authorized
29submitter of the documents specified in subdivision (a).

30(c) With respect to the electronic submission of the records
31described in subdivision (a), the requirements that an authorized
32submitter be subject to a security audit under Section 27394 and
33a criminal records check under Section 27395 shall not apply where
34the certification requirements of subdivision (d) have been met.

35(d) (1) In order for subdivision (c) to apply, the county recorder
36and the Attorney General shall certify that the method of
37submission allowed under the system will not permit an authorized
38 submitter or its employees and agents, or any third party, to modify,
39manipulate, insert, or delete information in the public record,
P6    1maintained by the county recorder, or information in electronic
2records submitted pursuant to subdivision (b) of Section 27391.

3(2) Certification under this section may be withdrawn by either
4the county recorder or the Attorney General at any time either
5determines that the requirements of this subdivision are not met.

6(e) For purposes of this section, an agent of an authorized
7submitter shall not include a vendor of electronic recording delivery
8systems.



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