Bulletin: AZ2018002

Date:
July 19, 2018
To:
All Arizona Issuing Offices
RE:
LEGISLATIVE UPDATE - Arizona 2018 State Legislative Report

Dear Associates:

The Arizona Legislature adjourned its 2018 regular session sine die in the early morning of May 4, 2018. This year, the Legislature introduced 1329 Bills; 374 were signed into law, and 23 were vetoed. 

The following is a summary of legislation that was passed during the 2018 legislative session.  

BILLS THAT PASSED 

Bills listed below will become effective on August 3, 2018, unless otherwise noted. 

HB 2178 (secretary of state; notary public)

Requires a notary public who resigns to submit their resignation in writing to the SOS, rather than the Governor; Removes language permitting a notary to perform a notarial act on a document that is a translation of a document that is in a language that the notary does not understand if the translator signs an affidavit containing an oath or affirmation that the translation is accurate and complete; Requires the official seal of a notary to include their notarial commission number. Requires the SOS to accept a surety bond issued by a notary public that was issued 60 days, rather than 30 days, after the SOS commissions the notary; Requires a notary public whose official journal or seal is compromised to deliver a signed notice of the compromise to the SOS within 10 days; Repeals several statutes relating to electronic notarization and, instead, requires the SOS to adopt standards for secure and feasible implementation of electronic notarization before January 1, 2020; Permits notarial commission, duties and acts to be performed electronically (subject to SOS implementing regulations); Allows notaries to accept documents signed with an electronic signature; Requires a notary public that is appointed after the effective date to use an official seal imprinted with their commission number. Requires a notary public appointed before the effective date to replace their official seal on reappointment with an official seal imprinted with their notarial commission number; Modifies the definition of a notarial act or notarization to specify that it only verifies the identity of the signer of a document and not the truthfulness, accuracy or validity of the document; Expands the list of satisfactory evidence of identity for the purpose of notarizing to include: A nonoperating ID license; An inmate identification card issued by ADC, if the inmate is in the custody of ADC; and Any form of inmate ID issued by a county sheriff, if the inmate is in their custody. Amends Section 38-294, 41-311, 41-313, 41-315, 41-317, 41-323, 41-332 and 41-351, Repeals Sections 41-352, 41-353, 41-354, 41-355, 41-357, 41-358, 41-359, 41-360, 41-361, 41-362, 41-363, 41-364, 41-365, 41-366, 41-367, 41-368, 41-369 and 41-370; Amends Title 41, Chapter 2, Article 3, by adding a new section 41-352; Amends Section 44-7011, Arizona Revised Statutes.

HB 2155 (notaries public; immigration law; prohibition)

Prohibits a notary public who is not an attorney from rendering any service for compensation that constitutes the unauthorized practice of immigration and nationality law. Requires the SOS, in addition to any other penalty, to impose a civil penalty of up to $1,000 for any violation and revoke the notary public's commission. Amends Section 41-329, Arizona Revised Statutes.

HB 2098 (insurance; inducements)

Increases the monetary value of prizes, goods, or tangible property that an insurer may offer in connection with an insurance transaction to up to $100. Amends Section 20-452, Arizona Revised Statutes.

HB 2240 (judgment renewal; time period)

Increases the time period to enforce and renew a judgment after entry from 5 years to 10 years. Amends Sections 12-1551, 12-1611, 12-1612, 12-1613 AND 33-964, Arizona Revised Statutes. 

NOTE: Judgment liens that have not expired as of August 3, 2018, (the effective date of this bill) should be treated as creating a lien for ten (10) years.

SB1204 (trusts and estates) 

Relating to Probate Proceedings: Asserts that the Arizona Rules of Probate Procedure rather than the Arizona Rules of Civil Procedure govern formal estates, trusts, and protective proceedings, with exceptions; Clarifies that a penalty clause for contesting a will is unenforceable in either proceedings or actions if probable cause exists for the contest, proceedings or actions; Provides a devisee with four months, after notice of an informal probate, to commence a formal probate proceeding; Specifies that publication for formal probate must be made at least three times before the hearing, the first of which must be 14 days before the hearing.  

Relating to Trust Instruments: Asserts that a penalty clause for contesting a trust instrument is unenforceable in either proceedings or actions if probable cause exists for the contest, proceedings or action; Modifies the definition of mandatory distribution to include a distribution amount for a stated age and a distribution made pursuant to the exercise of a power of withdrawal; Specifies that a person is not considered a qualified beneficiary, distributee or other beneficiaries for certain reporting requirements of a trust instrument if specific distributions of property have already been made or satisfied; Clarifies that recipients of a certification of trust who acts in good faith can require a trustee to furnish copies of excerpts from the trust instrument; Prohibits a person from requiring a trustee to furnish copies of excerpts from the trust instrument unless the person provides a verified statement of reasonable basis for the request; Specifies that a person is not liable for acting in reliance on a certification of trust without actual knowledge that any representations contained in the certification are incorrect; States that actual knowledge of trust terms cannot be solely inferred from the fact that a copy of the trust is held by an employee of the person relying on a certification of trust; States that a person who demands a trust instrument or excerpts in addition to a certification of trust is liable for costs, expenses and attorney fees if the person did not act in good faith or did not comply with statutory requirements; Clarifies that a person's right to obtain a copy of a trust instrument in a judicial proceeding includes excerpts from the trust instrument. Amends Sections 14-1304, 14-2517, 14-3306, 14-3403 and 14-10105; Amends Title 14, Chapter 11, Article 1, by adding Section 14-10113; Amends Section 14-10506, 14-10813, 14-10819 and 14-11013, Arizona Revised Statutes.

NOTE:  See Virtual Underwriter for Verified Statement when Requesting Trust Documents 

SB1043 (county recorder; recording fees) Effective July 1, 2019

Requires the county recorder to charge the following flat fees for recording papers, rather than per-page fees: $15 for papers to which the state, U.S. or a political subdivision is a party and is recorded at their request; $30 for all other papers required or authorized to be recorded.

Removes the following fee amounts and instead requires the county recorder to charge the $15 or $30 flat fees for recording: $15 for each deed that transfers, conveys or affects a real property interest; $25 for each deed of trust or mortgage; and $10 for each release of a deed of trust or mortgage.

Stipulates the following fees are included in the $15 or $30 flat fee amounts: The $4 special recording surcharge assessed by a BOS for certain documents filed with the county recorder; the $2 fee for the recording of deeds or contracts relating to the sale or transfer or property; and the $5 fee for recording affidavits of annual work or claim maintenance fee payments.

Removes language permitting the state to pay recorder fees to the county recorder on a monthly basis; Removes the requirement that a person recording a deed of trust or mortgage for residential property constructed for one to four families include "residential 1-4" on each document; Eliminates the requirement that $3 be charged for each additional indexing or transaction on an instrument after the standard fee has been charged for the first indexing category, assignment, partial assignment, release, partial release or other modification of any index; Removes the requirement that the county recorder charge $1 for each instrument that the recorder is required to mail. Amends Sections 11-475, 11-475.01, 11-1132 and 27-208, Arizona Revised Statutes

NOTE: Effective July 1, 2019

SB1353 (limited liability company act; revisions) Title 29, Arizona Revised Statutes, is amended effective from and after August 31, 2019. Title 29, chapter 4, Arizona Revised Statutes, is repealed from and after August 31, 2020.

Adopts the Uniform Limited Liability Company Act (2013); Confirms the laws of this state govern the internal affairs and the liabilities of an LLC. Amends Sections 10-122.01 and 10-130; Repeals Title 29, Chapter 4; Amends Title 29, by adding Chapter 7; relating to Limited Liability Companies, all in Arizona Revised Statutes. 

NOTE: See full text of bill for details of effective date of the new law and repeal date of the old law. 

HB2154 (personal information; data security breaches)

Relating to data security breaches and notification requirements. Amends Title 18, Chapter 5; Amends Section 18-552; Amends Sections 33-1701 and 36-3802; Repeals Laws 2006, Chapter 232, Section 3, as amended by Laws 2016, Chapter 80, Section 31, and Arizona Revised Statutes.

HB2083 (insurance contracts; construction)

Stipulates if a translated insurance policy that is issued for delivery contains a specified disclaimer then the policy does not amplify, extend, or modify the terms of the English version; States the disclaimer must be prominently displayed on the cover page or a page that corresponds to the cover page; Provides disclaimer language. Amends Section 20-1119, Arizona Revised Statutes. 

HB2656 (electronic wills and trusts) Effective July 1, 2019

Relating to electronic wills. Amends Sections 14-1201, 14-2502, 14-2506 and 14-2507; Amends Title 14, Chapter 2, Article 5, by adding Sections 14-2518, 14-2519, 14-2520, 14-2521, 14-2522 and 14-2523; Amends Sections 14-3402 and 14-3971, Arizona Revised Statutes. 

NOTE: Effective July 1, 2019. See full text of bill for details. 

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

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None