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In the last issue of CEA News, this column provided a preview of the 2007-2008 session of the California Legislature, and promised, without specifics, that there would once again be escrow issues for CEA to confront. Not to gloat, but how right we were! Never in recent memory have there been so many issues relevant to escrow introduced in a single year, demonstrating the value of CEA in representing escrow practitioners. All told, over 2900 new bills were introduced for the 2007 year. Each bill must be read for potential impact on escrow. At the conclusion of this review, almost four dozen bills were identified for discussion by the CEA Bill Review Committee, chaired by Don Smith under the leadership of portfolio chair Lexi Howard. Just as escrow moves from a series of deadlines to deadlines, so does the legislative process, and right now, the Capitol is struggling to conduct the first hearing on the 2900 new bills. It may be hard to believe, but this process may be even more chaotic than an escrow office at the end of a month during the refinance boom. The following presents just a snapshot of some of the many issues pending for CEA. • AB 18 (Blakeslee): Signature Stamps. Provides a new procedure for people who are unable to sign their names to use a signature stamp. Requires the presence of a witness in certain circumstances. • AB 239 (DeSaulnier): Recording Fees. Provides for a recording surcharge on certain real estate documents, in Contra Costa County only, for the purpose of providing assistance in the development of affordable housing. • AB 339 (Cook): Mobilehome Escrows. Designed to address issues raised by the recent appellate court case of Castillo v. Express Escrow, relating to escrow’s obligation when there is knowledge of alleged defects in the mobilehome or manufactured home. • AB 434 (Silva): Notaries. Requires notaries to respond to demands for copies of entries in notary journals within 15 business days of request. • AB 703 (Ruskin): Social Security Numbers. Requires that documents containing social security numbers be discarded in a manner specified in the bill, and requires the encryption or locked storage of all records containing social security numbers. • AB 804 (Huff): Escrow Agents. Modifies the language concerning the Escrow Agents’ Fidelity Corporation which must be included in all advertisements by DOC-licensed escrow companies. • AB 886 (Runner): Proposes extensive modifications to notary laws, including a requirement to obtain a thumbprint of the signing party on all notarized documents. • AB 941 (Torrico): Loan Documents. Permits the transmission of certain loan documents to borrowers by electronic means. Intended to foster a discussion of streamlining the loan documentation process. • AB 1168 (Jones): Social Security Numbers. Designed to prohibit public entities from selling public records which contain full social security numbers, this bill could have profound impacts on the release of county real property records. • AB 1188 (Coto): Escrow Disbursements. Requires escrow officers to indicate a disbursement date on closing statements, in order to demonstrate that residential mortgage lenders have complied with limitations on charging interest. • SB 127 (Kuehl): Property Transfer Disclosures. Requires real property disclosure documents, including required documents from common interest development associations, to be delivered to buyers within 10 days after execution of the purchase agreement. • SB 270 (McClintock): Unclaimed Property. Lengthens the current 3-year escheat period on unclaimed property to 7 years. • SB 634 (Wiggins): Williamson Act Contracts. Imposes significant liability on property owners who transfer property subject to the Williamson Act without properly notifying local government. • SB 702 (Torlakson): Attached Residential Condominiums. Increases the presumed liquidated damages in sales of attached residential condominiums from the current 3% to 5%. |
by Michael D. Belote
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