Bulletin: ID2022001

Dear Associates:

The following are summaries of some of the bills passed during the 2022 legislative session which are of interest to the title industry:

S 1240 Restrictive covenants, race - Effective 07/01/2022 - Modifies Chapter 6, Title 55 of Idaho Code to add two new sections.

Section 55-616

• Prohibits and makes void any existing provision in a written instrument relating to real property that purports to forbid or restrict the conveyance, encumbrance, occupancy, or lease thereof to individuals because of race, color, ethnicity, or national origin and every condition, restriction, or prohibition, including a right of entry or possibility of reverter, that directly or indirectly limits the use or occupancy of real property on the basis of race, color, ethnicity, or national origin.
• Covenants and deeds with racially restrictive language were made illegal by the 1968 Federal Fair Housing Act, but language still exists even if it is not enforceable. This legislation allows an owner OR tenant of property to file a modification if the covenants on the property contain such language. The modification document strikes from the referenced original instrument all provisions based on race, color, ethnicity, or national origin that are void and unenforceable under law.

Section 55-820

• States that no deed recorded on or after July 1, 2022, shall contain a reference to a restrictive covenant prohibited by section 55-616, Idaho Code.

S 1282 Abstracters of title - Effective 07/01/2022 - Repeals Chapter 1, Title 54 relating to abstracters of title and amends section 63-307. 

• Repeals Ch.1, Title 54 which required Abstracters to give a Bond and be issued a Certificate.
• Amends Section 63-307 to allow the tax assessor to rely on evidence of ownership furnished to the assessor that is admissible at trial in a civil action. Evidence of ownership admissible in a civil action includes but is not limited to a policy of title insurance or title commitment issued by a duly qualified title insurance company licensed in the state of Idaho.

HB 580 Easements, commercial character - Effective 07/01/2022 - Amends existing law to provide for easements in gross of a commercial character.

• Amends Section 55-603, Idaho Code, to provide for easements in gross of a commercial character as follows:

(2) Easements in gross of a commercial character, whether existing or created in the future, may be transferred, assigned, or conveyed in accordance with the express language of the instrument. As used in this section, "easement in gross of a commercial character" means an easement that is a personal interest in or right to use the land of another:

(a) For the transmission or distribution of water, sewer, natural gas, or petroleum products;

(b) For the provision of telephone or data service;

(c) For the transmission, distribution, or transformation of electricity; or

(d) For purposes of commercial agricultural uses, including without limitation grazing of livestock, farming, and propagation and harvest of timber crops.

HB 609 Liens, mechanics - Effective 07/01/2022 - Amends Section 45-507, Idaho Code, mechanics lien law, to provide for recovery of attorney’s fees in certain instances.

HB 703 Homeowner's Association Act - Effective 07/01/2022

An increasing number of Idahoans reside within homeowner's associations. To protect the rights of current and subsequent property owners within a homeowner's association, it was the intent of the legislature to ensure the transparent operation and inclusive management of these associations, balancing the rights of all owners within homeowner's associations to promote harmony and respect for community standards and to protect the rights of individuals and neighbors in the community. 

• HB 703 repeals Sections 45-810 (Homeowner’s Association Liens), 55-115 (Homeowner’s Association - Prohibited Conduct), and 55-116 (Statement of Account - Disclosure of Fees) Idaho Code.
• Creates a new chapter, Chapter 32, Title 55 Idaho Code Homeowner’s Association Act.
• Section 55-3206 Sets out the process for assessing fines for violation of covenants and restrictions.
• Section 55-3207 Sets out the process for filing liens for costs incurred in the maintenance of common areas, portions of note:
  • Once the lien has been filed as long as the original amount remains unpaid new amounts due will automatically be added to the original lien with no need to record a modification.
  • If an action to recover a money judgment for unpaid assessments is pursued, and then satisfied the lien is automatically satisfied as well.
• Sections 55-3208 thru 55-3211 limit the HOA’s ability to enforce covenants in regard to Solar Panels, Political Signs, Flags and the Rental of Property.
• Section 44-1311 is amended to allow for liens against water users, the lien shall be recorded and collected in accordance with the provisions of 55-3207.

HB 748 Water rights transfer - Effective 07/01/2022

Adds 55-616 to existing law. This Bill provides that certain appurtenant water rights and water entitlements and obligations shall pass with the transfer of real property. A transfer of real property does not pass water rights or water entitlements that are not appurtenant to the real property.

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