Bulletin: IN2019002

Dear Associates:

The following are summaries of some Bills passed during the 2019 Indiana legislative session, which are of interest to the title insurance industry. All Bills became effective as of July 1, 2019, unless otherwise noted.

HB 1375 State Board Of Accounts: Among other provisions, it makes changes to the procedure governing the payment of delinquent property taxes and specifies how delinquent property tax payments are to be applied. 

HB 1347 Municipally Owned Utilities: This bill provides that rates, charges, and fees assessed by a municipally owned utility (other than services rendered by a municipally owned sewer utility or by a department of public utilities for a consolidated city) with respect to property occupied by someone other than the owner, do not constitute a lien against the property. The occupant must have an account / billing records with the utility for the provisions to apply.

HB 1427 Local Government Matters: There are numerous provisions in this bill, but those primarily applicable to real estate include:

1.   Manufactured / Mobile Homes: Requires a statement in the county treasurer's notice of intention to sell mobile homes that the county treasurer will apply for a court judgment against the mobile homes for an amount that is set by the county executive and that includes collection expenses. Provides that whenever no bid is received on a mobile home, the taxpayer who is delinquent in the payment of taxes causing the tax sale maintains ownership of the mobile home and liability for the delinquent taxes. Makes the filing deadlines for property tax deductions applicable to mobile homes and manufactured homes that are not assessed as real property the same as the filing deadlines for property tax deductions applicable to real property.

2.   Sales Disclosure / Transfer Fee (Plat Book Fee): Increases from $5 to $10 per deed or legal description of each parcel contained in the deed, the amount of the county fee that a county auditor shall charge for endorsing a real estate conveyance document and provides that the fee revenue must be used for developing or maintaining plat books, in traditional or electronic format. Also note that a new “sales disclosure form” is being developed but is currently unavailable at this time. 

HB 1487 Business Services of the Secretary of State: This bill amends the law concerning the business practices of the Secretary of State, including 

1.   Striking the current Uniform Commercial Code (UCC) financing statement form; adding use of a format that meets certain criteria for the filings; and amending the UCC fees. 

2.   Changes to notary statutes, including:

a.  adding to the requirement to include a notary public's Indiana county on an authentication certificate; 

b.  amending requirements concerning notary public examination and education;  

c.  prohibiting performance of a notarial act: 

(i)  to benefit oneself or one's spouse; or 

(ii)  when a commission is suspended or revoked; 

d.  specifying a notarial act fee applies; 

e.  providing for issuance of a certificate of fact for a notary public per signature

f.  requiring maintenance of a remote notary public electronic journal for 10 years;

g.  the law concerning remote notarial acts applicable only to a remote notarial act performed after the earlier of the effective date of certain administrative rules or July 1, 2020. 

h.  increases the fee that a notary public may charge for a remote notarial act from $15 to $25.

SB 265 Various Trust Matters: Defines "designated representative", "judicial proceeding", and "nonjudicial matter" for purposes of the trust code. Authorizes the establishment of legacy trusts and prescribes procedures for establishing a legacy trust and requirements for claims. Adopts the uniform directed trust act, which allows for the terms of a trust to grant a person other than a trustee power over some aspect of the trust's administration. Provides that current law regarding the duties and liabilities of a trustee of a trust under the control of a third person applies to directions given to a trustee before July 1, 2019, by a person who has power under the terms of the trust to direct the trustee. Allows for the use of quiet trusts. 

SB 518 Probate Matters: There are many aspects to this bill, but the most relevant for real estate transactions include:

1.   Small Estate: This changes the “small estate affidavit” as commonly used by requiring a Court appointed fiduciary (personal representative or person acting on behalf of decedent or distributees) to record an affidavit and file a closing statement in order to sell real estate free from claims. [NOTE: Watch for a separate Bulletin]

2.   Transfer on Death Deeds: Provides that if a transfer on death deed has been recorded before the death of the owner, a subsequent conveyance is void if it is not recorded before the death of the owner with the recorder of deeds in the county where the real property is situated. 

3.   Electronic Estate Planning Documents: Authorizes the Indiana supreme court and office of judicial administration to establish and administer a statewide electronic estate planning documents registry (registry). Allows certain individuals to deposit the following items into the registry: (1) An electronic will. (2) An electronic trust instrument. (3) An electronic power of attorney. (4) Any electronic document that revokes or amends an electronic will, electronic trust instrument, or electronic power of attorney. Requires the registry administrator to make the registry index: (1) available to; and (2) searchable by; the public; and documents submitted to or deposited with the registry private, secure, and inaccessible to the public. 

4.   Medicaid Recovery: Requires the estate recovery unit of the office of Medicaid policy and planning to provide notice of a claim against an estate in certain instances and changes time period to 75 days for filing a claim against an estate upon proper notice. A Notice of Administration sent to the Indiana Medicaid Estate Recovery unit is required for any decedent in a probate estate who was at least 55 years of age at the time of death. 

SB 566 Residential Tax Increment Financing: This bill permits a redevelopment commission to establish a program for residential housing development and a tax increment funding allocation area for the program if the average of new, residential houses constructed in the county or municipality in the preceding three years is less than 1% of the total number of residential houses in the county or municipality.  

SB 604  Voiding & Releasing Claims in Land Interest (sovereign issues): Adds a provision to the statute concerning marketable title for real property to provide that, after a person has filed a claim for an interest in land, the claim is void if: (1) the owner of the property subject to the claim (or any person having an interest in the property) provides written notice to the claimant to file an action to enforce the claim; and (2) the claimant fails to file, within 30 days after receiving the notice to enforce the claim, an action to enforce the claim in the county where the property is located. Provides that upon the claimant's failure to file an action to enforce the claim within the 30 day period, the person who provided the notice to the claimant may file with the recorder of the county where the property is located an affidavit stating that the person has served notice on the claimant to enforce the claim and that no action for enforcement of the claim is pending. Requires the county recorder to record the affidavit of service. Allows a county recorder to certify certain records by cross reference to the records, rather than on the records themselves. 

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