BILL NUMBER: AB 2143 CHAPTERED
BILL TEXT
CHAPTER 380
FILED WITH SECRETARY OF STATE SEPTEMBER 16, 2016
APPROVED BY GOVERNOR SEPTEMBER 16, 2016
PASSED THE SENATE AUGUST 15, 2016
PASSED THE ASSEMBLY AUGUST 22, 2016
AMENDED IN SENATE JUNE 28, 2016
AMENDED IN SENATE JUNE 6, 2016
AMENDED IN ASSEMBLY APRIL 12, 2016
INTRODUCED BY Assembly Member Irwin
FEBRUARY 17, 2016
An act to amend Sections 27296 and 27390 of, and to amend, repeal,
and add Sections 27391 and 27393 of, the Government Code, relating
to electronic recording.
LEGISLATIVE COUNSEL'S DIGEST
AB 2143, Irwin. County recorder: electronic recording.
Existing law requires the county recorder in each county to
complete a yearly statistical report on a specified form of documents
recorded and filed.
This bill would require the report to also include information
regarding electronically submitted documents, and would require
documents to be counted and reported in the same manner without
regard to method of transmission.
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.
This bill, until January 1, 2027, 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. The
bill, until January 1, 2027, 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, until January 1, 2027, would additionally authorize the
regulations to include requirements for general liability coverage
as described above.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 27296 of the Government Code is amended to
read:
27296. (a) The county recorder in each county shall complete a
yearly statistical report of documents, including electronically
transmitted documents, recorded and filed on the form described in
subdivision (b). The report shall be submitted to the office of the
Insurance Commissioner. Documents shall be counted and reported in
the same manner without regard to method of transmission. The county
recorder may either charge for copies of this report or may disburse
the report without fee for public information. Certified and
noncertified copies of any records issued by the county recorder
shall not be included in this report.
(b) The standard statistical report form shall be substantially
as follows:
Documents Recorded and Filed
Year
Deeds ..................................
Deeds of Trust and Mortgages ...........
Reconveyances ..........................
Trustee's Deeds ........................
Total number of documents
recorded and filed .....................
SEC. 2. Section 27390 of the Government Code is amended to read:
27390. (a) This article shall be known and may be cited as the
Electronic Recording Delivery Act of 2004.
(b) For the purposes of this article, the following definitions
shall apply:
(1) "Authorized submitter" means a party that has entered into a
contract with a county recorder pursuant to Section 27391 and is not
disqualified pursuant to Section 27395.
(2) "Computer security auditor" means computer security personnel
hired to perform an independent audit of the electronic recording
delivery system. The computer security auditor shall be independent
of the county recorder and the authorized submitter and shall not be
the same contractor hired to establish or participate in a county's
electronic recording delivery system or in the authorized submitter's
portion of that system.
(3) "Digital electronic record" means a record containing
information that is created, generated, sent, communicated, received,
or stored by electronic means, but not created in original paper
form.
(4) "Digitized electronic record" means a scanned image of the
original paper document.
(5) "Electronic recording delivery system" means a system to
deliver for recording, and to return to the party requesting
recording, digitized or digital electronic records.
(6) "Security testing" means an independent security audit by a
computer security auditor, including, but not limited to, attempts to
penetrate an electronic recording delivery system for the purpose of
testing the security of that system.
(7) "Source code" means a program or set of programs, readable and
maintainable by humans, translated or interpreted into a form that
the electronic recording delivery system can execute.
(8) "System certification" means the issuance of a confirmation
letter regarding a county's electronic recording delivery system by
the Attorney General.
SEC. 3. Section 27391 of the Government Code is amended to read:
27391. (a) Upon approval by resolution of the board of
supervisors and system certification by the Attorney General, a
county recorder may establish an electronic recording delivery
system.
(b) Upon system certification, a county recorder may enter into a
contract with a title insurer as defined in Section 12340.4 of the
Insurance Code, underwritten title company as defined in Section
12340.5 of the Insurance Code, institutional lender as defined in
paragraph (1), (2), or (4) of subdivision (j) of Section 50003 of the
Financial Code, or an entity of local, state, or federal government
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 subdivision (a) of Section
27201. The contract may provide for the delivery of documents by an
agent. However, the agent shall not be a vendor of electronic
recording delivery systems.
(c) (1) A county recorder may enter into a contract with an
authorized submitter not authorized pursuant to subdivision (b) 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 subdivision (a) of Section
27201. The contract may provide for the delivery of documents by an
agent. However, the agent shall not be a vendor of electronic
recording delivery systems.
(2) An authorized submitter authorized pursuant to this
subdivision and any agent submitting documents on behalf of an
authorized submitter pursuant to this subdivision shall provide proof
of financial responsibility by providing a certificate of insurance
evidencing an amount of general liability coverage reasonably
adequate to protect against liability and cover potential losses. The
amount of general liability coverage required by this paragraph
shall be set through rule or regulation by the Attorney General in
consultation with interested parties.
(d) A county recorder may refuse to enter into a contract with any
party or may terminate or suspend access to a system for any good
faith reason, including, but not limited to, a determination by the
county recorder that termination or suspension is necessary to
protect the public interest, to protect the integrity of public
records, or to protect homeowners from financial harm, or if the
volume or quality of instruments submitted by the requester is not
sufficient to warrant electronic recordation. A county recorder may
also terminate or suspend access to a system if a party commits a
substantive breach of the contract, the requirements of this article,
or the regulations adopted pursuant to this article.
(e) Notwithstanding Section 27321, a county recorder may require a
party electronically submitting records to mail a copy of the
recorded electronic document to the address specified in the
instructions for mailing upon completion of recording.
(f) When a signature is required to be accompanied by a notary's
seal or stamp, that requirement is satisfied if the electronic
signature of the notary contains all of the following:
(1) The name of the notary.
(2) The words "Notary Public."
(3) The name of the county where the bond and oath of office of
the notary are filed.
(4) The sequential identification number assigned to the notary,
if any.
(5) The sequential identification number assigned to the
manufacturer or vendor of the notary's physical or electronic seal,
if any.
(g) This section shall remain in effect only until January 1,
2027, and as of that date is repealed.
SEC. 4. Section 27391 is added to the Government Code, to read:
27391. (a) Upon approval by resolution of the board of
supervisors and system certification by the Attorney General, a
county recorder may establish an electronic recording delivery
system.
(b) Upon system certification, a county recorder may enter into a
contract with a title insurer as defined in Section 12340.4 of the
Insurance Code, underwritten title company as defined in Section
12340.5 of the Insurance Code, institutional lender as defined in
paragraph (1), (2), or (4) of subdivision (j) of Section 50003 of the
Financial Code, or an entity of local, state, or federal government
for the delivery for recording, and return to the party requesting
recording, of a digitized electronic record that is an instrument
affecting a right, title, or interest in real property. The contract
may provide for the delivery of documents by an agent. However, the
agent shall not be a vendor of electronic recording delivery systems.
(c) A county recorder may refuse to enter into a contract with any
party or may terminate or suspend access to a system for any good
faith reason, including, but not limited to, a determination by the
county recorder that termination or suspension is necessary to
protect the public interest, to protect the integrity of public
records, or to protect homeowners from financial harm, or if the
volume or quality of instruments submitted by the requester is not
sufficient to warrant electronic recordation. A county recorder may
also terminate or suspend access to a system if a party commits a
substantive breach of the contract, the requirements of this article,
or the regulations adopted pursuant to this article.
(d) Notwithstanding Section 27321, a county recorder may require a
party electronically submitting records to mail a copy of the
recorded electronic document to the address specified in the
instructions for mailing upon completion of recording.
(e) When a signature is required to be accompanied by a notary's
seal or stamp, that requirement is satisfied if the electronic
signature of the notary contains all of the following:
(1) The name of the notary.
(2) The words "Notary Public."
(3) The name of the county where the bond and oath of office of
the notary are filed.
(4) The sequential identification number assigned to the notary,
if any.
(5) The sequential identification number assigned to the
manufacturer or vendor of the notary's physical or electronic seal,
if any.
(f) This section shall become operative on January 1, 2027.
SEC. 5. Section 27393 of the Government Code is amended to read:
27393. (a) The Attorney General shall, in consultation with
interested parties, adopt regulations for the review, approval, and
oversight of electronic recording delivery systems. Regulations shall
be adopted pursuant to the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3). The
regulations shall comply with Section 12168.7.
(b) The regulations adopted pursuant to subdivision (a) may
include, but need not be limited to, all of the following:
(1) Establishment of baseline technological and procedural
specifications for electronic recording delivery systems.
(2) Requirements for security, capacity, reliability, and
uniformity.
(3) Requirements as to the nature and frequency of computer
security audits.
(4) A statement of a detailed and uniform definition of the term
"source code" consistent with paragraph (7) of subdivision (b) of
Section 27390, and as used in this article, and applicable to each
county's electronic recording delivery system.
(5) Requirements for placement of a copy of the operating system,
source code, compilers, and all related software associated with each
county's electronic recording delivery system in an approved escrow
facility prior to that system's first use.
(6) Requirements to ensure that substantive modifications to an
operating system, compilers, related software, or source code are
approved by the Attorney General.
(7) Procedures for initial certification of vendors offering
software and other services to counties for electronic recording
delivery systems.
(8) Requirements for system certification and for oversight of
approved systems.
(9) Requirements for general liability coverage required by
subdivision (c) of Section 27391.
(10) Requirements for fingerprinting and criminal records checks
required by Section 27395, including a list of employment positions
or classifications subject to criminal records checks under
subdivision (f) of that section.
(11) Requirements for uniform index information that shall be
included in every digitized or digital electronic record.
(12) Requirements for protecting proprietary information accessed
pursuant to subdivision (e) of Section 27394 from public disclosure.
(13) Requirements for certification under Section 27397.5.
(c) The Attorney General may promulgate any other regulations
necessary to fulfill his or her obligations under this article.
(d) An electronic recording delivery system shall be subject to
local inspection and review by the Attorney General. The Attorney
General shall furnish a statement of any relevant findings associated
with a local inspection of an electronic recording delivery system,
to the county recorder and the district attorney of the affected
county, and to all technology vendors associated with that system.
(e) This section shall remain in effect only until January 1,
2027, and as of that date is repealed.
SEC. 6. Section 27393 is added to the Government Code, to read:
27393. (a) The Attorney General shall, in consultation with
interested parties, adopt regulations for the review, approval, and
oversight of electronic recording delivery systems. Regulations shall
be adopted pursuant to the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3). The
regulations shall comply with Section 12168.7.
(b) The regulations adopted pursuant to subdivision (a) may
include, but need not be limited to, all of the following:
(1) Establishment of baseline technological and procedural
specifications for electronic recording delivery systems.
(2) Requirements for security, capacity, reliability, and
uniformity.
(3) Requirements as to the nature and frequency of computer
security audits.
(4) A statement of a detailed and uniform definition of the term
"source code" consistent with paragraph (7) of subdivision (b) of
Section 27390, and as used in this article, and applicable to each
county's electronic recording delivery system.
(5) Requirements for placement of a copy of the operating system,
source code, compilers, and all related software associated with each
county's electronic recording delivery system in an approved escrow
facility prior to that system's first use.
(6) Requirements to ensure that substantive modifications to an
operating system, compilers, related software, or source code are
approved by the Attorney General.
(7) Procedures for initial certification of vendors offering
software and other services to counties for electronic recording
delivery systems.
(8) Requirements for system certification and for oversight of
approved systems.
(9) Requirements for fingerprinting and criminal records checks
required by Section 27395, including a list of employment positions
or classifications subject to criminal records checks under
subdivision (f) of that section.
(10) Requirements for uniform index information that shall be
included in every digitized or digital electronic record.
(11) Requirements for protecting proprietary information accessed
pursuant to subdivision (e) of Section 27394 from public disclosure.
(12) Requirements for certification under Section 27397.5.
(c) The Attorney General may promulgate any other regulations
necessary to fulfill his or her obligations under this article.
(d) An electronic recording delivery system shall be subject to
local inspection and review by the Attorney General. The Attorney
General shall furnish a statement of any relevant findings associated
with a local inspection of an electronic recording delivery system,
to the county recorder and the district attorney of the affected
county, and to all technology vendors associated with that system.
(e) This section shall become operative on January 1, 2027.