Legislature(2001 - 2002)
03/27/2002 01:40 PM Senate JUD
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 263-AFTER ACQUIRED TITLE IN REAL PROPERTY
CHAIRMAN TAYLOR asked Ms. Annette Kreitzer if she had any further
testimony to provide on SB 263.
MS. ANNETTE KREITZER, Staff to Senator Loren Leman, sponsor of SB
263, said she had completed her remarks. She said Chairman
Taylor was going to speak with a gentleman who testified at the
previous meeting.
CHAIRMAN TAYLOR said he had heard from the gentleman but had been
unable to come to any conclusions regarding his concerns. He did
not have any amendments to offer. He asked if there was anybody
who wished to testify on SB 263.
MR. BRYAN MERRELL, First American Title Company of Alaska, said
he was the gentleman they were speaking of. He said he had a
lengthy conversation with Mr. Jon Tillinghast and others from
Sealaska and they weren't able to come to a resolution to answer
his concerns. He said they could attempt to fashion the bill so
that it only applied to the situation facing Sealaska but he had
concerns regarding the constitutionality of doing so. He said
others in his industry were concerned as well. He said the Land
Title Association for the state of Alaska, which was made up of
underwriters and title insurance agents throughout the state,
voted at its board meeting to oppose SB 263 because of those
concerns. He said those concerns had not changed and he hadn't
seen any suggestions which would alleviate those concerns.
CHAIRMAN TAYLOR asked Mr. Merrell to reiterate his concerns.
MR. MERRELL said his concerns came from changing an aspect of the
common law to address one particular situation that had arisen
with Sealaska. He was also concerned with the exception to the
rule for state-related entities, which meant the rule wouldn't
apply uniformly. He said that would cause anomalies in
attempting to examine and produce a title report or title policy
related to a piece of property and make it difficult for an
examiner to make a determination of the intent of the parties.
He said the situation might arise where a quitclaim deed would be
issued involving formerly state-owned property. He said there
was confusion and concern about how far it could go and when it
would stop automatic pass through a title when a quitclaim deed
was used rather than a warranty deed. He couldn't find any other
state that had made a similar exception. He said many times
quitclaim deeds were used to transfer titles in and amongst
family members, not realizing the potential effect of passing
after-acquired interest and whether or not that would continue
passing through family members. He said there were no stopping
points and nothing to indicate when that would or wouldn't
happen.
CHAIRMAN TAYLOR asked if he had discussed amending the bill to
more narrowly constrain it. He said SB 263 as written would
apply to people and corporations that may have conveyed by
quitclaim deed. He said it specifically excluded the
Legislature, a state agency, the executive branch, the judicial
branch, the University of Alaska and the Alaska Railroad
Corporation. He said if the railroad granted a quitclaim deed to
somebody, they wouldn't be required to convey any after-acquired
interest. But if he as a private person conveyed by quitclaim
deed, any after-acquired interest would be conveyed. He
suggested removing subsection (b) on page 2 and rewriting
subsection (a) on page 1 so it would specifically apply to Native
corporations.
MR. MERRELL said they had not discussed that solution. He said
the concept was somewhat attractive. He said subsection (b) was
added at the request of the administration because they didn't
want the new rule to apply to them.
CHAIRMAN TAYLOR said the State had tentatively selected certain
lands, some of which had been sold. He said some might have been
issued a quitclaim deed because the State didn't have full title
or final patent or because the State cannot convey subsurface
rights. He said a change in the law by Congress could cause
Alaskans to own subsurface rights, just as Native corporations
did. He noted that Congress had said it was permissible to own
subsurface rights for one type of owner but not another. He said
instead of trying to figure out who should be excluded, they
should try to figure out who wanted to be included.
MR. JON TILLINGHAST, Sealaska Corporation, said he drafted an
amendment to that end that would work for them. He said
subsection (a) could read something like, "In addition to any
estate passed by the grantor under AS 34.15.070, whenever a
person purports by either (1) a warranty deed or (2) in the case
of real property conveyed under the Alaska Native Claims
Settlement Act, a quitclaim deed to grant real property and then
subsequently acquired interest then the title passes." He said
the new rule would apply in two situations: the warranty deed for
everybody; and the quitclaim deed for property conveyed under the
Alaska Native Claims Settlement Act (ANSCA). He said subsection
(b) could be deleted entirely.
CHAIRMAN TAYLOR liked that solution because it limited the new
rule enough so that the title companies would know that would be
the only situation they would have to worry about in their search
for defects in title.
MR. TILLINGHAST was confident it would withstand special
legislation criticism.
CHAIRMAN TAYLOR moved Amendment #1 to insert Mr. Tillinghast's
words into subsection (a) beginning on page 1 and delete
subsection (b) on page 2. He asked if Sec. 3 and Sec. 4 were
still necessary.
MR. TILLINGHAST said they were.
CHAIRMAN TAYLOR asked if there was any objection to Amendment #1.
There being no objection, Amendment #1 was adopted.
CHAIRMAN TAYLOR asked if Mr. Tillinghast had anything further to
provide. He did not. He asked Mr. Merrell if he understood the
amendment.
MR. MERRELL believed he did and believed it would alleviate their
concerns. He noted that he would like to see the language.
CHAIRMAN TAYLOR thanked Mr. Merrell and Mr. Tillinghast for their
participation. He asked if there was anybody else who wished to
provide testimony on SB 263. There was nobody.
SENATOR ELLIS moved CSSB 263(JUD) out of committee with attached
zero fiscal note and individual recommendations.
There being no objection, CSSB 263(JUD) moved out of committee
with attached fiscal note and individual recommendations.
| Document Name | Date/Time | Subjects |
|---|