BILL ANALYSIS �
AB 1642
Page 1
ASSEMBLY THIRD READING
AB 1642 (Gordon)
As Amended March 29, 2012
Majority vote
LOCAL GOVERNMENT 8-0
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|Ayes:|Smyth, Alejo, Bradford, | | |
| |Campos, Gordon, Hueso, | | |
| |Knight, Norby | | |
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SUMMARY : Requires county recorders to record any document that
relates to real property authorized or required to be recorded
by a local ordinance, and clarifies the form requirements for a
notice of intent to preserve an interest in real property.
Specifically, this bill :
1)Requires the recorder of a county, upon payment of proper fees
and taxes, to accept for recordation any instrument, paper, or
notice that is authorized or required to be recorded by a
local ordinance that relates to real property.
2)Prohibits the recorder of a county from refusing to record any
instrument, paper, or notice that is authorized or required to
be recorded by a local ordinance that relates to real property
on the basis of its lack of legal sufficiency.
3)Clarifies the form of the notice of intent to preserve an
interest in real property to replace the formal requirement of
acknowledgement by the county recorder with a statement that a
certificate of acknowledgment is required.
EXISTING LAW requires the county recorder, upon payment of
proper fees and taxes, to record any document that is authorized
or required by statute or court order to be recorded, provided
that the document meets certain standards.
FISCAL EFFECT : None
COMMENTS : This bill contains two unrelated provisions of
interest to county recorders. The first provision simply
revises the requirements of a particular notice related to real
AB 1642
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property to make clear that county recorders do not themselves
conduct acknowledgments. The second is intended to explicitly
authorize county clerk/recorders to officially record documents
authorized or required to be recorded by a local ordinance.
That authorization would allow local governments to return to
the long-standing practice of recording local Notices of
Violation (NOVs) issued for property-related code violations, a
practice that was halted by the 2011 California appellate court
case County of Santa Cruz v. Carrick, 2011 Cal. App. Unpub.
LEXIS 2924, 53, due to a perceived lack of statutory authority.
The bill is sponsored by the Santa Clara County Board of
Supervisors.
The first provision makes a technical amendment to the statutory
format for the Notice of Intent to Preserve Interest in real
property. Such notices are used to preserve a future interest
in real property, and facilitate real property title
transactions by enabling individuals to rely on record title.
The recordation of the notice creates a presumption that the
person who claims the interest has not abandoned it, and is
often used in cases where an individual's future interest in
real property is contingent on some other action or occurrence.
Under current law, the format for the notice includes a section
for 'acknowledgment' by the recorder, but this requirement
conflicts with Government Code Section 27287 which contains a
statutory requirement for acknowledgement of execution prior to
recording. In actual practice, acknowledgments are performed by
notary publics, not by the recorder's office. This bill would
reconcile the different code sections by revising the form of
the NOV to simply require a certificate of acknowledgement as a
precondition to recordation.
The second provision relates to the recordation of local NOVs.
According to the sponsor, the Carrick decision "? is problematic
because it calls into question whether NOVs authorized by local
ordinance may be recorded and if they are recorded, whether they
are valid. Ultimately, if state law does not recognize the
authority of counties and cities to record NOVs pursuant to
local ordinances then current or future property owners will not
be put on notice that there are existing code violations on the
property?This �bill] would preserve the ability of counties and
cities to use this valuable code enforcement tool. More
importantly, it would protect consumers."
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According to the sponsor, "Notices of Violation (NOV) are a key
code enforcement tool used by virtually all cities and counties
in California. NOVs serve to put the public on notice that
there are code violations on a property. In most instances, a
recorded NOV has the effect of precluding the property from
being sold or refinanced because lenders will not provide
mortgage financing for properties with existing violations. The
County of Santa Clara records NOVs for a variety of
property-related code violations including violations of our
building, zoning, grading, and environmental health ordinances."
In April 2011, the California Court of Appeal, Sixth Appellate
District heard an appeal involving a dispute between the County
of Santa Cruz and an individual, Paul Carrick, whose property
had been cited for numerous code violations. In reversing the
trial court's finding for the County, the unpublished appellate
opinion found in part that state law did not authorize the
County's recording of a April 2006 Notice of Violation on
Carrick's property.
The court found that, while the County had relied on a 1980
Attorney General Opinion (63-905) for the proposition that "a
county may enact an ordinance providing for the recordation of
documents other than those specifically authorized by State law
based upon �the county's] police powers?", the Attorney
General's Opinion no longer applied because of subsequent
changes to the relevant code section.
The court noted that Government Code Section 27201(a) now
requires the recorder to accept for recordation any document
"that is authorized or required by statute or court order to be
recorded." The court also cited case law establishing that the
recorder has no authority to record unauthorized documents for
recordation. As a result, the court followed the plain meaning
of Government Code 27201(a) to find that only statutes and court
orders could authorize recordation - not municipal ordinances
like Santa Cruz County's.
Perhaps mindful that its close reading of the statute
represented a substantial change in practice for local agencies,
the court flagged the matter for the Legislature: "�i]f the
County believes that public policy supports the recording of
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documents beyond those authorized by Government Code section
27201, subdivision (a), it should address those arguments to the
Legislature." �County of Santa Cruz v. Carrick]
Support arguments: Without this change in law to formalize the
long-standing practice of recording NOVs, cities and counties
will lose a valuable tool for code enforcement while harming
public disclosure. It is also beneficial to reconcile
inconsistencies between related statutes.
Opposition arguments: The recordation of NOVs can be abused,
with potentially negative impacts on private property rights, so
that sanctioning the practice is arguably unwise.
Analysis Prepared by : Hank Dempsey / L. GOV. / (916) 319-3958
FN: 0003260