Legislature(1995 - 1996)
04/18/1995 01:03 PM House CRA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 176 - ADJUSTMENTS FOR DEFECTIVE SURVEY Number 634 The next bill to be heard was HB 176. CO-CHAIR IVAN indicated that the packets contained a proposed committee substitute, fiscal note, sponsor statement and supporting documentation. Representative Bunde was invited to introduce the bill. CO-CHAIR IVAN asked for adoption of the committee substitute. Number 649 CO-CHAIR AUSTERMAN moved that the committee substitute be adopted for discussion purposes. Number 650 CO-CHAIR IVAN indicated there was no objection and the committee substitute was adopted. He noted that Representative Nicholia had joined the committee. Number 651 REPRESENTATIVE CON BUNDE stated this legislation pertained to a problem with survey in his district. The survey has been a problem for people in that area for a long time. It is manifestly defective. This results in no one having a clear title within the subdivision and could not refinance or sell their property. Individual property owners could bring a quiet title action against surrounding lots; however, this is not a practical solution when there are multi-owner, multi-lot problems and the outside markers are so far off. HB 176 would allow a party to enjoin all property owners of record after properly petitioning the court, a resolution by the local government, and the creation of a special assessment district to request a resurvey and replat of a manifestly defective subdivision survey. This would result in changing individual lots through a superior court action. The MOA has requested this legislation to correct two manifestly defective surveys including 347 lots. While the changes are directed at an Anchorage situation, they would also be available to solve similar situations throughout the state. It was the sponsor's understanding that there was a similar problem in Nome. The bill allows for a vote of all affected property owners to determine if a resurvey of the entire subdivision or subdivisions should occur. The majority must concur to form a special assessment district. The municipality then must pass a resolution supporting this action in the formation of the assessment district. A complaint must be filed with court including a statement of fact and all relevant information surrounding the survey and the area in question. The MOA has considerable area in these subdivisions and is offering some of their land to resolve the problem. TAPE 95-13, SIDE B Number 000 REPRESENTATIVE BUNDE indicated that a subcommittee of the Alaska Society of Professional Land Surveyors, working with the various entities involved, concluded that when a subdivision survey is manifestly defective, it cannot be resolved on a piecemeal basis and had worked with the sponsor on the legislation. Number 021 CO-CHAIR IVAN asked what the definition was of a manifestly defective survey. Number 032 REPRESENTATIVE BUNDE stated that referring to page 5, line 2, it was when the entire subdivision was inaccurate. Number 048 REPRESENTATIVE VEZEY asked if by definition any survey that didn't include a rectangular survey system description or U.S. survey description would be defective, including mineral surveys and right-to-entry lands. He was concerned that there were a number of legal surveys now that would not be if this definition was adopted. Number 080 REPRESENTATIVE BUNDE indicated that those things were not included. Number 085 REPRESENTATIVE VEZEY then read that defective surveys did not include BLM rectangular surveys, U.S. surveys or state rectangular plats. Number 097 CO-CHAIR AUSTERMAN asked why there was such a difference between the committee substitute and the original bill. Number 110 REPRESENTATIVE BUNDE stated that it was the result of compromises with the Society of Land Surveyors. It puts a limit on the time available to address the issue and didn't put it in statutory language. It is a short-term answer. Number 122 REPRESENTATIVE VEZEY asked if the Alaska Society of Professional Land Surveyors endorsed the bill. Number 128 REPRESENTATIVE BUNDE stated that it was his understanding that the president of the society had expressed nonobjection. He did not think there was strong support, however. He indicated that he had worked with them, but the CS had not been taken before them. Number 140 REPRESENTATIVE VEZEY felt that in general they were moving away from the buyer beware concept. These people did not buy what they thought they were buying. He thought that the MOA throwing in land could probably solve the problem. Number 168 REPRESENTATIVE BUNDE indicated that the people bought land that was surveyed. The state of Alaska usually approves surveys through the municipality. The municipality accepted the survey. The individual buyer had reason to believe that the survey was valid. The original surveyor did a lousy job and is no longer around. This bill is an attempt to collectively solve the problem. Number 194 REPRESENTATIVE VEZEY asked where are the property owners, as far as their title insurance goes; had there been any recourse through the insurance company. Number 204 REPRESENTATIVE BUNDE indicated there was no recourse because they were not able to get title insurance. Number 209 REPRESENTATIVE VEZEY stated that title insurance was usually a condition of closing. Was it Representative Bunde's understanding that these property owners didn't have title insurance. Number 211 REPRESENTATIVE BUNDE said that was his understanding. Number 215 REPRESENTATIVE VEZEY indicated that the committee substitute was a substantially changed version of the bill. He did appreciate the sunset clause. He had not been able to find a similar statute in any of the other 50 states. He asked if Representative Bunde was aware of any. Number 222 REPRESENTATIVE BUNDE indicated he was not. Number 228 GEORGE NEWSHAM, Assistant Municipal Attorney, Municipality of Anchorage, agreed that the committee substitute was a significantly changed bill which was a credit to the Alaska Society of Professional Land Surveyors, particularly in the area of cost and protection of private property rights. One area of improvement was the establishment of an assessment district which requires a vote of the majority of the property owners in the proposed district. It also requires the official governing body to provide a resolution in support of the act. Both provide a great deal of protection for those people who do not want to participate. Another issue is divorcing this bill from the slide bill which was in last year's legislation. This was to try to keep as much separateness and not try to amend the Earth Slide Relief Act. Regarding the issue of title insurance, people are having difficulty in financing their properties because lenders are unwilling to lend on property which has an unworkable survey. The MOA does own a substantial amount of property in the area. Even if the MOA does offer some land, there is still the problem of the unworkable plat. Therefore, they feel this is the way to solve the problem. Number 284 REPRESENTATIVE ELTON asked how many of the 347 plots are owned by the municipality. MR. NEWSHAM indicated there were approximately 20-30 lots. Number 294 REPRESENTATIVE VEZEY asked if any of the property owners, after the initial owners, purchased title insurance. Had anyone recovered from the title insurance company. Number 314 MR. NEWSHAM stated that some have title insurance, but he was unaware of any claims made on the title insurance policies. Part of the problem with a quiet title action is that it is hard to show the damages when the original survey was so bad. Number 323 REPRESENTATIVE VEZEY asked if he was saying that some of the property owners had title insurance and wasn't title insurance based on a legal description of a recorded subdivision in Anchorage. Number 328 MR. NEWSHAM indicated that the problem was that the survey was so bad that there is more property being sold than is in the subdivision. It is difficult to see what the title insurance was going to do because the plat said you owned a lot or section in that subdivision, but the survey was worthless. Number 330 REPRESENTATIVE VEZEY stated he was still curious about why no one had filed an action with the title insurance company. If they insured the property, and then found out that the piece of property didn't exist or can't be located, the policy holder's rights would be upheld. Number 333 MR. NEWSHAM indicated he was not aware of any claims. Number 335 TOM KNOX, professional land surveyor, Municipal Surveyor with the Municipality of Anchorage, stated that in the last nine years, at least once a month a property owner contacted him from these areas asking for an explanation of the problem. The bill is trying to give the property owners within the boundary of the defective survey subdivisions, an opportunity to resolve the location and produce an accurate description of their property. The survey affects the whole subdivision and, therefore, requires the whole area to be resurveyed. He supported passage of the legislation. Number 388 REPRESENTATIVE VEZEY asked if Mr. Knox had discussed the issue with other members of the Alaska Society of Land Surveyors and, if so, would he summarize those discussions. Number 410 MR. KNOX stated as a member of the society and listening to the comments of John Bennett, the president of the society, he understood that they support the concept of trying to resolve survey issues addressed by the bill, but did not give complete support because they had not seen the final version. Number 420 REPRESENTATIVE VEZEY asked if one person could demand that their property rights be upheld and could cause problems for all involved. Number 422 MR. KNOX stated that he couldn't address the constitutional issues, but as far as Anchorage was concerned, Anchorage has changed its ordinances to allow surveys to be a part of an assessment district or an improvement that could be assessed. Safeguards are built in, such as a majority of people who recognize the need for the improvement be required to approve it and the minority would have to go along with it. The right remains to challenge it in court. Number 437 REPRESENTATIVE VEZEY asked if, as a surveyor, Mr. Knox could go in and redivide and make all the property owners happy. Number 443 MR. KNOX indicated he didn't know if he could answer the happiness issue. He did know that the property corners in the two subdivision were staked and would require retracing to establish. Through the years, people have made improvements off their property and those problems will come to light. That is why the court is needed. There will be people who will be unhappy. Number 464 REPRESENTATIVE BUNDE noted that on page 4, line 26, the bill states, "this section does not affect the right of a person harmed by a defective survey to recover damages from the defective survey or limit the liability of the person who did the survey." It does allow the issue to be addressed in court. Number 471 CRAIG SAVAGE, land surveyor in Anchorage, past president of the Alaska Society of Professional Land Surveyors, testified via teleconference from Anchorage, expressed concern with the bill and thought it should be looked at carefully and slowly. One concern was that there is no other example of this legislation in the U.S. and wondered why that was. Another concern was regarding the funding. He considered the special assessment district concept of funding unfair, expensive and cumbersome. People who are satisfied with their property lines should not have to fund others who are not. The assessment will have to be grossly inflated to cover unforeseen costs. People should have a way to solve their title problems, but they should also fund those solutions. He suggested a more appropriate remedy would be through modification of the quiet title laws to allow for a class action suit. Number 515 REPRESENTATIVE BUNDE noted that a majority of the people he had heard from in the affected area supported redress. He agreed that he didn't want to assess people for something that didn't provide a benefit to them. He felt this legislation did improve the quality of the subdivisions involved. Number 531 JOHN BENNETT, President, Alaska Society of Professional Land Surveyors (ASPLS), indicated they had put together a subcommittee to review the legislation and offer assistance. Part of his membership felt that resolution could be found in existing law, individual rights could be trampled by the process, and there was a fuzzy definition of what constituted a defective survey. Members in favor saw it as the only rational solution to such a large scale boundary and title problem, given the cost of dealing with it on a lot-by-lot basis. Although a phone poll had resulted in a 6-6 split, he felt that the Alaska Society of Professional Land Surveyors had to take a position. He stated the ASPLS was in support of the general concept of the legislative solution, although the support was weak. He indicated they hadn't seen the Senate substitute which modified the approach a little bit. The sunset provision and the complicated process made it more acceptable. Number 563 REPRESENTATIVE VEZEY stated he was uneasy about the lack of a definition of defective survey and no definition of manifestly defective survey. Would the society by willing to investigate the definition. Number 570 MR. BENNETT indicated the committee was working with Senator Rieger's office in developing the definitions and would be willing to look at it again. Number 576 JIM COLVER, President, Mountain Construction & Engineering, felt this was an isolated situation. He felt the legislation was dealing with common law traditions which was that the physical evidence holds, and once established and used over time, established the boundaries. He thought that was the foundation of boundary law. He felt one remedy was to replat sections of the subdivision. If someone built a house where they thought their lot was, create a lot around it. Land trades were also part of the solution. In individual lot situations in Mat-Su, nonconforming permits are issued, which might work in this situation. He was hesitant to rewrite law to solve one subdivision's problems. He also supported changes to the quiet title actions as a solution. He felt this legislation was too encompassing. Number 634 MR. MCKEE, Anchorage, elaborated on problems he has had with these issues. Number 668 PATRICK KALAN, Vice Chairman of the American Congress of Surveying and Mapping, noted that this was a problem specific to Anchorage. He preferred the legislation to be specific to Rabbit Creek subdivision. He believed the surveying community was divided on how to deal with this situation. He was concerned with setting a precedent and didn't know of any other legislation similar to this. He felt the committee substitute was an improvement and appreciated the sunset clause. He hoped the committee would go slowly after more consideration. TAPE 95-14, SIDE A Number 000 REPRESENTATIVE BUNDE summarized that this situation had been going on for 20 years and we're in need of the state's assistance to resolve the problem. It was a unique situation; however, redress was necessary. If there were ways to do it from a private point of view, they would have done so. This was a compromise. Number 040 REPRESENTATIVE VEZEY asked if quiet title action had been pursued. Number 062 MR. KNOX stated that no one had taken a quiet action to court as far as he knew. Number 080 REPRESENTATIVE BUNDE indicated that while one person could get the quiet title to their property, the problems involved the entire subdivision. Number 081 MR. KNOX stated that a class action would be necessary to resolve the entire subdivision issue. Number 089 REPRESENTATIVE VEZEY asked if the municipality had considered using its powers of eminent domain and take possession of the property and become the sole owner and subdivide it as they saw fit. Number 100 MR. KNOX indicated he felt it would be a bad idea for the MOA to take the property because they didn't have accurate descriptions. Number 113 CO-CHAIR IVAN inquired as to the wish of the committee regarding the bill. Number 115 REPRESENTATIVE VEZEY noted that the bill had a further referral to the Judiciary Committee and the committee substitute hadn't had as much review as the original bill. He moved that CSHB 176(CRA) with attached fiscal note be passed out with individual recommendations. Number 126 CO-CHAIR IVAN asked if there were any objections. Hearing none, CSHB 176(CRA) passed out of committee. CO-CHAIR IVAN indicated that HB 262 would be held until Thursday, April 20.
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