Bulletin: LA2024003

Dear Associates:

The Louisiana Legislature considered a variety of proposed legislation during its 2024 regular session. The following is a summary of legislation passed during the session of relevance to the title industry. All bills have an effective date of August 1, 2024, unless otherwise noted.

Small Successions

Act 90 is a comprehensive revision of Code of Civil Procedure statutes affecting Small Succession. While most revisions are for clarification purposes, some were substantive in nature.

For details on substantive changes, please see separate Bulletin LA2024004.

Filiation Actions

Act 96 revises La. R.S. 9:410 and Louisiana Civil Code Article 197. Under the revisions, a filiation action under CC 197 shall be a civil proceeding governed by Book II of the Code of Civil Procedure. While a filiation action under the revision may be its own separate action or cumulated in a succession proceeding, the mere opening of a succession proceeding under Book VI of the Code of Civil Procedure shall not constitute a filiation action. The revisions are deemed to be interpretive and thus have retroactive effect.

Agents are advised to review any filiation action having a direct effect on immovable property for procedural compliance with Book II of the Code of Civil Procedure.

Continued Tutorship

Act 123 is a revision of the Louisiana Civil Code articles on continued tutorship to allow for full or limited continued tutorship in designated circumstances and removes the designation of permanent tutorship, allowing for the termination of a continued tutorship upon an appropriate change in circumstances.

Agents are reminded that a person under full or limited tutorship has the legal capacity of an unemancipated minor, regardless of the person’s age. Proper authority must be obtained when closing transactions involving persons under any continued tutorship.

Planned Community Act

Act 158 amends and reenacts the Homeowner’s Association Act as the Planned Community Act. The new act is more comprehensive in nature - increasing applicability beyond residential property, expanding the defined terms, and expanding the rights of an association against occupants/lessees. The amendments to articles directly related to the privilege on immovables for charges or dues assessed by the association apply both to those developments under the Planned Community Act and under the Louisiana Condominium Act, and most notably require the association to provide a binding statement of amounts owed by a particular lot/unit owner within ten (10) days of request.

The act will go into effect on January 1, 2025, for declarations establishing planned communities filed for registry on or after that date. For planned communities established by declaration filed for registry on or before December 1, 2024, the act will go into effect on January 1, 2026.

Due to the comprehensive nature of the act, agents are encouraged to review it closely for changes related to the agents’ practice.

Factory-Built Home Property Act

Act 287 amends and reenacts the Manufactured Home Property Act as the Factory-Built Home Property Act. The new act defines the term “factory-built home” to include manufactured homes, mobile homes, and modular homes, and generally applies the rules of the Manufacture Home Property Act to all types of housing now defined as factory-built homes. While the revision is comprehensive with expanded defined terms, the most notable change is relative to the immobilization of factory-built homes.

Immobilization of factory-built homes no longer need be by authentic act. However, the declaration of immobilization now MUST be filed in the Conveyance records of the appropriate parish and can no longer be included within a sale or mortgage.

The revision incorporates a presumption of a grant of any interest held by the landowner/seller in non-immobilized factory-built homes upon the transfer of an immovable upon which they are located.

Real Estate Services and Service Agreements

Act 363 (effective 5/28/2024) addresses issues created by Right to List contracts and Performance Mortgages/Homeowner Benefit Agreements, all of which fall under the act’s definition of a “real estate services agreement.” The act prohibits the recordation of real estate services agreements and establishes that there shall be no security against residential property for any obligation within a real estate service agreement. The act further establishes the absolute nullity of a mortgage granted which purports to create an encumbrance on immovable property as security for obligations within a real estate services agreement. The recordation of a real estate services agreement in an effort to secure an obligation contained therein shall be deemed a deceptive and unfair trade practice and subject the violator to penalty under the act. Finally, the act provides remedies for cancellation of improperly recorded real estate service agreements.

Discharge in Bankruptcy

Act 383 (effective 5/28/2024) expands the applicability of La.R.S. 9:5175 and 9:5175.1 to debtors who have filed for bankruptcy protection of any type under the U.S. Bankruptcy Code. Previously, the remedies offered by these statutes were limited to only those debtors under Chapters 7 and 13 cases. This act also expands the authorized use of the affidavit cancellation procedure to allow any Louisiana licensed attorney to file the statutory cancellation affidavit. The result is greater ability to obtain release or partial release of judgments or liens securing scheduled debts. 

Foreign Adversaries

Act 420 is an extension of the foreign adversary prohibitions created by Acts 464 and 106 of 2023. This act extends the scope of prior acts to include prohibition of the ownership, lease, or acquisition of any interest in agricultural land by a foreign adversary or prohibited foreign actor. The act does allow for the sale or conveyance of an ownership interest by a prohibited foreign actor. Under the act, third parties may rely on an affidavit by the person acquiring an interest in agricultural land declaring the acquiring party is not a foreign adversary.

While attorneys, title producers, and notaries have no duty to identify a person acquiring an interest in agricultural land as a foreign adversary or prohibited foreign actor, it remains good practice to include a foreign adversary affidavit as a closing document. 

Prescriptive Period for Tort Actions

Act 423 (effective 7/1/2024) extends the prescriptive period for tort actions to two years. As applicable to immovable property, prescription commences to run from the day the owner acquired, or should have acquired, actual knowledge of the damage to the property. The act repeals Louisiana Civil Code articles 3492 and 3493 in their entirety. This act applies only to tort actions arising after the effective date and does not extend the prescriptive period of causes of action existing prior to the effective date. 

Electronic Filing and Record Retention

Act 501 addresses the continued concern over record retention within the state’s official records maintained by clerks of court. As space becomes increasingly limited and a greater number of documents are filed/recorded electronically, the Legislature has addressed the retention of physical original documents in this act. In the act, clerks of court are given authority to adopt a system of their choosing for electronic filing and storage; accept electronic transmittal of documents and exhibits; convert pleadings, documents, and exhibits into electronic form; return or dispose of originals filed on or after January 1, 2005, in any record upon conversion of the original to electronic form (with exceptions for survey related documents); and maintain electronic only records for acts filed on or before December 31, 2004, in records other than Conveyances. Clerks of Court must maintain originals of testaments that are probated or ordered to be filed and executed. 

The act establishes the electronic record as the official record and gives the electronic record the same effect against third persons as filings of original instruments. However, the act does provide certain mechanisms for the return of original documents to certain parties upon electronic conversion. Agents are advised to review the act for details on return of originals related to transactions for which the agent deems warrant the maintenance of original documents. 

Support Animals and Service Dogs

Act 558 creates “The Louisiana Support and Service Animal Integrity Act” establishing requirements and penalties for healthcare providers who produce documentation relating to an individual’s need for a service or support animal and breeders/trainers of service animals. The act creates a distinction between service animals and support animals and clarifies the differences in rights related to each. While this act does not change or modify state or federal laws related to the right for reasonable accommodations, it does aim to create tighter restrictions on the issuance of documentation related to need and the difference between a support animal and a service animal. 

Expropriation and Eminent Domain

Act 620 creates parameters in which companies created for the purpose of, or engaged in, the transportation or injection of carbon dioxide underground may have expropriation rights for right of way and surface acquisition. This act advances the state’s interest in carbon capture and sequestration projects. 

Real Estate License Law

Act 690 (effective 8/19/2024) aims to fulfill requirements of the settlement agreement from class action lawsuits filed against the National Association of Realtors. The act provides definitions of “buyer agreement,” “buyer,” and “home” and sets forth requirements for buyer agreements within a residential transaction. Agents should expect to see buyer agreements become a regular part of the closing transaction. 

Mechanic's & Materialman Privileges on Immovables

Act 758 addresses the rights and obligations of sureties with respect to privileges on immovables filed under the Private Works Act. Sureties are allowed to assert defenses of the principal against claimants and must follow set requirements for payment to a seller of movables.

HCR 80 was also passed directing the Louisiana State Law Institute to study the Private Works Act with specific focus on provisions relative to protecting homeowners from claims arising from home improvement projects and from having to pay twice for work in order to avoid liens by unpaid claimants. The LSLI is to report its findings no later than January 25, 2025. 

Tax Sales

Act 774 (effective 1/1/2026, if Constitutional Amendment passed) aims to overhaul the tax sale process in Louisiana to address various due process deficiencies in the current tax sale process identified by both the Louisiana Supreme Court and the United States Supreme Court. In short, the act would convert the tax sale process in Louisiana from a sale of ownership interest in the subject property to a sale of lien rights against a subject property. Acquired lien rights could then be enforced through foreclosure, upon the passage of appropriate time for redemption, notices, etc. However, the current language of the Louisiana Constitution does not allow for the process established in this act, and thus a Constitutional Amendment is necessary for this act to take effect. 

Act 409 proposes an amendment to Article VII, Section 25 of the Constitution of Louisiana. This amendment will appear on the December ballot for voter approval. The amendment establishes the assessment of ad valorem taxes and other imposition on immovable property as a lien and privilege on the property and grants the legislature authority to establish laws regarding the sale of tax lien rights, within the parameters designated. It also allows for the postponement of taxes in the event of disaster. This amendment provides the constitutional basis necessary for the tax sale revisions contained in Act 774. 

Due to the vast scope of the revisions to the tax sale process contained in these acts, a separate detailed bulletin will be distributed at a later date.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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