Legislative Update
By I hope this message finds each of you well and enjoying professional fulfillment in your law practice. I expect that many of us would say that the prior year has been among one of the most unusual, and perhaps trying, of our lifetimes. Although probably not at the top of our list of challenges wrought by the COVID-19 pandemic, I am sure that most of us have missed gathering with our colleagues at in-person CLE programs and other section activities. As we head towards a full reopening of society and commerce, which I hope will include in-person meetings and gatherings in the not-too-distant future, I would like to make sure that our section members are aware of several pending bills in the General Assembly of interest to real estate practitioners so that you may provide feedback to your representatives as you see fit. This legislative session is particularly busy with impactful legislation for real estate lawyers, and this message will touch upon only certain significant bills:
- Remote Online Notary. Various stakeholders, including our Section, NCLTA and the Secretary of State’s Office, have been working diligently on a permanent remote online notary (“RON”) bill to replace the temporary remote online notary authorization authorized by the General Assembly at the beginning of the COVID-19 pandemic. Several members of the RPS Council, including Nancy Ferguson, John McLean and Jason Pelz, have devoted significant time to negotiating various parts of this legislation, and we believe the legislation is now in a form that will provide a valuable tool if enacted. The proposed Remote Online Notarization Act, House Bill 776, passed the House of Representative and is now under consideration by the Senate. You may access the proposed legislation at https://www.ncleg.gov/BillLookUp/2021/h776.
- Privacy Redaction. HB 304 is a privacy shielding measure that would allow law enforcement officers and certain judicial officers to require identifying information to be redacted from public websites. While the intent of the legislation is laudable in light of recent tragic events involving the targeting of law enforcement officers and judicial officials, experience with similar legislation in other states has revealed that redaction of personal information can create significant problems for the intended beneficiaries of the legislation by impairing the ability of title searchers to certify title to real estate owned by the beneficiaries of the legislation. Our section will need to be vigilant to insure that any enacted legislation achieves its goal of providing law enforcement officers and judicial officials with a means to remove personal identifying from public records while preserving the integrity of real estate title records. The American Land Title Association’s website has various resources on this topic at https://www.alta.org/advocacy/redaction-and-record-shielding.cfm. I encourage you to review these resources and the proposed legislation at https://www.ncleg.gov/BillLookUp/2021/h304, and to make your representatives aware of any concerns that you may have and, more importantly, suggestions that you may have to improve the legislation so that it accomplishes its goal of providing protection to the intended beneficiaries while preserving the integrity of their real estate records.
- Uniform Partition of Heirs Property Act. H367 is the Uniform Partition of Heirs Property Act that seeks to change significantly the partition procedure for “heirs property”— generally speaking, real estate owned by tenants-in-commons (“TICs”) in which 20% or more of the interests are owned by relatives or owned by TICs who acquired their interests from a relative and for which there is no recorded agreement binding on all TICs that governs partition of the property. Notably, North Carolina’s Partition Act was amended significantly last year after significant study and input by various stakeholders, including the Real Property Section. I encourage you to review the legislation at https://www.ncleg.gov/BillLookUp/2021/h367. Proponents of the legislation maintain that it is needed in order to stop investors, non-occupying family members and others from wresting ownership of heirs property from family members who are occupying or otherwise using heirs property. Opponents of the legislation have expressed concerns that this legislation will favor certain TICs over others, increase the cost of partition proceedings to the detriment of the intended beneficiaries of the legislation, and require Clerks of Court to exercise judicial discretion generally reserved to Superior Court judges. At this point, the Real Property Section Council has not taken a position on the legislation, but we are forming an ad hoc committee to study the legislation. If you have experience with partition proceedings and are interested in serving on the ad hoc committee, please let me or another Council member know. If you are not interested in serving on the ad hoc committee but have opinions to share, please share them in any event. I encourage you to communicate with your representatives. They need to hear from lawyers who actually handle partition proceedings regarding the potential effects of this legislation.
Thank you for taking the time to read this message. If you have thoughts regarding the legislation described above, please reach out to me ([email protected]), Nancy Ferguson ([email protected]) or John McLean ([email protected]).