Bulletin: NY000121

Dear Associates:

Pursuant to Chapter 226 of the Laws of 1996, a new Section 436 was added to the Real Property Law which provides for the gradual elimination of the Torrens Land Registration System in New York State.

The new statute provides that no land titles may be registered in the Torrens system after December 31, 1996. From January 1, 1997 to December 31, 1999, the only instruments which will be accepted for registration in the Torrens system will be "adverse instruments", i.e., instruments which do not convey title, and do not require the consent of the owner of the property to establish their validity. "Adverse Instruments" would include, but not be limited to, mechanic's liens, judgments and notices of pendency.

On and after January 1, 1997, "voluntary instruments", i.e., those which convey fee title or affect registered land and which require consent of the owner to establish validity (e.g. deeds, mortgages, easements, leases, etc.), will not be accepted for registration. Instead, the Registrar will memorialize such voluntary instruments (as well as adverse instruments) on the Certificate of Title to the property affected, and then, upon payment of the appropriate recording fee, deliver such Certificate to the County Clerk (or in New York, Bronx, Kings and Queens Counties, the Register's Office), of the County where the property is located for recording.

On or before January 1, 2000, the Registrar will deliver all other Certificates of Title to the County Clerk (or the City Register, if the affected property is located in one of the Counties of the City of New York, except for Richmond) for recording. Once the recording of the Certificate for a property has been made in the County Clerk's (or Register's) Office, title to such property will thereafter be conveyed or encumbered pursuant to Article 9 of the Real Property Law.

If the schedule outlined in the statute is adhered to, the Torrens system will be eliminated by the year 2000. As additional information on the procedures to be used by the Clerks' Offices in complying with the statute become available, we shall advise you.

Should you have any questions, please contact Company Counsel.