Bulletin: AZ2013001

Dear Associates:

The Arizona Legislature adjourned the 2013 regular session sine die during the early morning hours of June 14, 2013. In all, the 2013 session lasted 151 days, which is the longest session in four years, and saw 1,158 bills introduced, 256 signed into law, and 26 vetoed.

BILLS THAT PASSED

Bills listed below will become effective on September 13, 2013, unless otherwise noted.

HB 2031 (federal patent easements; counties; abandonment) [Chapter 49] authorizes counties to abandon federal patent easements established by the Small Tract Act of 1938 at the request of the property owner if the easement is not being used by the public and all affected utilities give consent. Adds ARS 11-251.16.

HB 2033 (foreclosures; deeds of trust; affidavits) [Chapter 50] stipulates that if a beneficiary of a deed of trust receives payment from private mortgage insurance in addition to proceeds from the trustee’s sale, the beneficiary must record with the county recorder a declaration of additional funds stating the amount received. Also, the trustee is required to execute and to record the trustee's deed within seven business days after payment. On completion of the sale, the trustee is required to notify the beneficiary of any obligations imposed by ARS 11-1133. Amends ARS 11-1133 and 33-811.

HB 2143 (joint tenancy severance) [Chapter 87] is the LTAA’s bill to define the process to sever title held as joint tenants with right of survivorship. The process mirrors the process currently used to sever community property with right of survivorship. For a deceased joint tenant, the termination may be evidenced by the surviving joint tenant recording an affidavit and attaching the death certificate. Amends ARS 33-431.

HB 2281 (foreclosure; tenant notification) [Chapter 224] requires a property owner to provide a rental tenant with written notice within five business days if the property owner receives a notice of trustee’s sale. Amends ARS 33-1331.

SB 1094 (notaries public; impersonation; violation) [Chapter 77] states that a person who knowingly impersonates a notary public is guilty of impersonating a public servant, which is a class 1 misdemeanor. Also, the penalty for a vendor who provides an official notary seal to a person without a photocopy of their notarial commission is increased from a class 3 misdemeanor to a class 6 felony. Amends ARS 13-2406 and 41-321 and adds ARS 41-333.

SB 1233 (limited liability companies; ownership interests) [Chapter 198] allows ownership in a LLC to be held as joint tenants with right of survivorship or as community property with right of survivorship and sets forth certain requirements by which assignees can be admitted as members. The LTAA was able to work with the proponents to offer a clarifying amendment. Amends ARS 29-632 and adds ARS 29-732.01.

SB 1278 (homeowners’ associations; public roadways) [Chapter 103] says that after the period of declarant control, a HOA is prohibited from regulating any roadway owned or held by a governmental entity. Only applies to HOAs for which the declaration is recorded after December 31, 2014. Adds ARS 33-1818.

SB 1454 (elections; campaign finance; HOAs) [Chapter 254] makes multiple changes to election, campaign finance, and HOA laws. This bill was one of the final bills passed during the 2013 session and became a “Christmas tree” bill that was used to “hang” multiple, unrelated issues on during the waning days of session. Concerning topics of interest to the title industry, the bill allows management companies to lawfully record lien notices and appear in small claims court on behalf of a HOA. The bill allows a property or unit owner to designate a third party, such as a tenant, to act on their behalf with respect to all HOA matters and stipulates that any notice to the third party serves as notice to the property or unit owner. Finally, a HOA may charge a $25 administrative fee for each new tenant, and prohibits a HOA from charging a fee to the rental unit that would be different if charged to an owner-occupied property or unit. Amends and adds multiple sections to ARS.

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