Bulletin: IN2013010

Dear Associates:

HEA 1054 - Secretary of State Filings: This Act provides that the Indiana Secretary of State may refuse to accept certain filings if the financing statement is not required or authorized to be filed with the secretary of State or the Secretary of State has reasonable cause to believe the financing statement is fraudulent. It provides that the Secretary of State does not have a duty to inspect, evaluate or investigate a financing statement that is presented for filing and provides that certain individuals may file a motion for judicial review of a financing statement to determine if the financing statement is fraudulent. The law prohibits a recorder from recording an instrument contaminated by blood or another bodily fluid.

HEA 1056 - Probate Estate: This Act provides that a personal representative may acquire an interest in real property from the estate if the transaction is authorized by an order of the court after notice and hearing. Prior law only permitted acquisition of real property by purchaser if authorized by will, trust, consent of all heirs, legatees or beneficiaries or an adjudicated compromise agreement approved by the probate court. Provides that all authority to act with respect to an estate is vested exclusively in the personal representative and if the probate code prohibits an action by the personal representative, the prohibition restricts the personal representative, regardless of court order, unless a majority in interest of the distributees expressly consent to the proposed action or the statute imposing the restriction expressly permits a court to approve the action.

HEA 1079 - Mortgages/Vendor’s Lien: This law changes the statute of limitations for mortgages and vendor’s lien. See Stewart Title Guaranty Bulletin IN2013002.

HEA 1132 - Mortgage Foreclosure: This Act requires a party filing a praecipe for sheriff’s sale to pay delinquent sewer liens on the property before a sheriff’s deed will be issued. Requires the interim study committee on insurance to study certificates of release of liens on mortgaged property during the 2013 interim and report the committee’s findings and any recommendations to the legislative counsel in electronic format no later than November 1, 2013.

HEA 1219 - Privacy of Home Addresses: Beginning July 1, 2014, this Act allows a city, town, county or township (unit) that operates a public Internet web site data base containing the names and addresses of property owners to establish a procedure to permit a law enforcement office, a judge or a victim of domestic violence who participates in the attorney general’s address confidentiality program (covered person) to restrict disclosure to the general public of the covered person’s home address. It also provides that a covered person must submit a written request to a unit in order for the unit to restrict access to the covered person’s home address through a public property data base web site and a unit may charge a reasonable fee.

HEA 1317 - Land Banks: This Act establishes the land bank study committee, a legislative study committee to study issues relating to the creation of land banks at the municipal level as well as the county level including: 1) the effects that municipal land banks and reformed land banking would have on current property tax collection and enforcement and tax sale; and 2) the effect the creation of municipal land banks would have on local revenues.

HEA 1321 - Insurance: Provides that documents obtained by the Department of insurance in the course of any examination are not open to public inspection or copying under IC 5-14-3-3 and are not subject to discovery or admissible in evidence in a private civil action.

HEA 1372 - Sales Disclosure Form: This Act provides that a buyer may not invalidate a real estate transaction or contract to purchase real estate due to the buyer’s failure to sign a seller’s disclosure statement form that has been received or acknowledged by the buyer.

HEA 1568 - Tax Sale: This Act provides that a county executive selling a vacant parcel upon which taxes are delinquent to a contiguous property owner shall sell the parcel for $1 plus amount of certain costs incurred by county in sale. (Under prior law, sales price included county costs). It also provides that for purposes of this section, a vacant parcel includes an improved parcel (current law provides that vacant parcel includes only an unimproved parcel). The new Act eliminates the property tax exemption for a vacant parcel acquired by a contiguous residential property owner and provides that a contiguous residential property owner who receives a tax deed for a vacant parcel may not sell the vacant parcel for one (1) year. The Act establishes an alternative urban homesteading program which allows qualified individuals to purchase property for $1 plus certain costs incurred by county obtaining the property. The new law provides that prior to the vesting of fee simple title in a qualified purchaser, any material failure by the purchaser to carry out the agreement under the program nullifies the agreement and all right, title, and interest in the property reverts back to the agency administering the program.

SEA 0005 - Hospital Liens: Amends the law concerning hospital liens related to certain personal injury claims by providing that lien must be filed for record within 90 days after person is discharged or no later than the date of final settlement, compromise or resolution of the action, claim or suit accruing to the patient. Provides that a lien is effective upon recording and is not retroactive. Penalty for not filing release upon payment of lien amount is increased to $25 per day.

SEA 126 - Homeowners Associations: This Act provides that if all lots included as part of certain homeowners associations are not subject to the same homeowners association covenants, all lots may be made subject to new replacement covenants if certain notice and majority vote conditions are met. Specifies that homeowners association covenants submitted to county recorder in accordance with these procedures are effective upon recording.

SEA 275 - Property Tax Installment Payments: This Act provides that a county auditor shall (rather than may under prior law) remove real property from the tax sale list if the county treasurer and the taxpayer agree to a mutually satisfactory arrangement for the payment of the delinquent taxes. County treasurer is required to provide a copy of the written agreement to the county auditor. The Act also provides that if a county council does not adopt an ordinance allowing taxpayers to make installment payments of property taxes, the county treasurer shall develop and implement a plan to accept partial payments of property taxes. Specifies that the county treasurer shall notify taxpayers on the property tax bill or in the envelope used to mail property taxes that the county has adopted a plan to accept partial payments.

SEA 279 - Mortgage Foreclosure: This Act eliminates the provision providing for post-foreclosure sale redemption rights that had remained in the foreclosure statute in error. Also eliminates a provision under which certain omitted parties who did not perfect their interest of record would not be bound by final foreclosure decree.

SEA 297 - Lien for Unpaid Underground Storage Tank Fees: This Act allows the Indiana Department of Revenue to impose a lien on the property of an owner or operator of an underground storage tank if the owner or operator fails to pay fees due under certain provisions. The lien shall be created and perfected in the same manner as state tax warrants.

SEA 367 - Conservation Easement: Amends the definition of “holder” for purposes of conservation easement law to include an Indiana nonprofit corporation that is granted a conservation easement.

SEA 370 - Title Insurance Forms/Rates and Closing Protection Letters: For closings on or after July 1, 2013, title companies and insurance producers are required by law to issue a closing protection letter (CPL) to a lender, borrower, buyer and seller in all residential real estate transactions in which: 1) a title policy is issued by the title company or insurance producer; and 2) the title company or insurance producer is also acting as a settlement or closing agent. A CPL may be issued in a non-residential transaction. A separate CPL must be issued to each party. The new law requires that a fee filed with and approved by the Indiana Department of Insurance shall be charged to the party benefitting from the CPL. This Act requires title underwriters to file policy rates and forms with the Indiana Department of Insurance (“IDOI”). IDOI Bulletin 199 issued on June 9, 2013 to interpret the new law, mandates that, as of July 1, 2013, no title insurance policy forms and rates may be issued or used in Indiana unless filed with the IDOI. As of July 1, 2014, no title insurance policy forms and rates may be issued or used in Indiana unless filed and approved by the IDOI. See STG Bulletins IN2013006, IN2013007 and IN2013008.

SEA 433 - Abandoned Property/Tax Sale: This Act establishes a procedure to permit a county executive to dispose of certain properties that did not sell at the tax sale to a person able to repair and maintain the properties. Provides that before the county executive may transfer properties that did not sell at a tax sale to a nonprofit corporation, an abutting property owner, or a person satisfactorily able to repair and maintain the property, the county must notify persons with a substantial interest in the property in order to give them an opportunity to redeem the property. It also removes requirements that a county executive’s sale of a contiguous vacant parcel to an adjoining property owner may only be conducted if construction of a residential dwelling is permitted on the vacant parcel. Additionally, this Act requires certain notices concerning demolition and removal under the unsafe building law be served on each person with a known or recorded substantial property interest. Requires a county executive preparing a list of tax delinquent properties to be submitted to auditor to include any real property that he/she has determined to be abandoned. Requires a county auditor in a county not having a consolidated city to prepare a list of tracts of real property within each city or town located in the county of tax delinquent property and give a copy of the list to the appropriate city or town. Authorizes a municipality or county to bring an action to collect unpaid expenses relating to the abatement of high weeds and grass (under current law, the municipality or county may obtain only a lien on the property) Provides that a creditor is a person immune from civil liability for entering abandoned real property to perform certain actions to clean up the real property.

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