AN ACT TO PROVIDE AN ALTERNATIVE MORTGAGE SATISFACTION FORM THAT ALLOWS A SECURED CREDITOR TO INDICATE THAT THE UNDERLYING OBLIGATION HAS BEEN EXTINGUISHED; TO MAKE IT A CLASS I FELONY TO SIMULATE COURT PROCESS IN CONNECTION WITH THE COLLECTION OF A CLAIM, DEMAND, OR ACCOUNT, TO KNOWINGLY FILE A FALSE LIEN OR ENCUMBRANCE AGAINST THE REAL OR PERSONAL PROPERTY OF A PUBLIC OFFICER OR PUBLIC EMPLOYEE, OR TO FILE A FALSE SECURITY INSTRUMENT; AND TO PROVIDE THAT IT IS A VIOLATION OF THE RESIDENTIAL MORTGAGE FRAUD ACT FOR A PERSON TO KNOWINGLY FILE A DOCUMENT FALSELY CLAIMING THAT A MORTGAGE LOAN HAS BEEN SATISFIED OR DISCHARGED. Summarized in Daily Bulletin 3/1/11, 6/7/12, 6/19/12, 6/27/12, and 7/2/12. Enacted July 12, 2012. Sections 1, 2, and 7 are effective October 1, 2012. The remainder is effective December 1, 2012.
Summary date: Jul 17 2012 - View summary
Summary date: Jul 2 2012 - View summary
Conference report recommends the following changes to 3rd edition to reconcile matters in controversy.
Makes clarifying changes to proposed GS 14-118.6, which concerns the register of deeds’ treatment of a false lien or encumbrance. Requires the Secretary of State (rather than the Administrative Office of the Courts) to adopt the appropriate form for a Notice of Denied Lien or Encumbrance Filing. Specifies that proposed subsections (b) (filing procedure) and (c) (designating false filing) do not apply to filings under Article 9 (secured transactions) of GS Chapter 25 or under GS Chapter 44A, and makes conforming changes. Adds a section, amending GS 44A-12.1(c), to make any person who files an unlawful claim of lien guilty of a Class I felony (was, a Class 1 misdemeanor).
Summary date: Jun 27 2012 - View summary
Senate amendment #3 makes the following changes to 2nd edition, as amended. Modifies changes made by Senate amendment #1 by amending proposed GS 14-118.6(b) to clarify that an entity denying the filing of a lien for reasonable suspicion that the lien is false must allow the claimant to file a Notice of Denied Lien Filing on a form approved by the Administrative Office of the Courts; interested persons may file a special proceeding within ten business days of the Notice being filed to determine whether a contractual or statutory basis for the lien exists; and interested persons must receive at least five days’ notice and opportunity to be heard on any hearing on such filing. Liens filed upon order of the court must have priority interest as of the date of the filing of Notice of Denied Lien Filing (except for liens filed under Chapter 44A of the General Statutes). Liens found to have no statutory or contractual basis must be ordered null and void and must not be recorded, and liens for which no special proceeding is filed within ten days of filing the Notice of Denied Lien Filing are deemed null and void. Proposed GS 14-118.6 also amended to add new subsection (d) providing that a violation of this statute constitutes an unfair trade practice in violation of GS 75-1.1. Makes technical conforming changes to the effective date.
Summary date: Jun 19 2012 - View summary
Senate amendment makes the following changes to 2nd edition. Amends proposed GS 14-118.6(b) to allow an entity to refuse to file a lien or encumbrance (was, the entity shall not allow the lien or encumbrance to be filed) when there is a reasonable suspicion that it is false. Adds that no entity is liable for filing or refusing to file a lien or encumbrance under the statute. Provides that in order for a judge to order the lien or encumbrance to be filed when there is an appeal, the judge must find that the lien or encumbrance is authorized by statute and the record appears on its face to contain all of the information required by the statute under which it was offered.
Summary date: Jun 7 2012 - View summary
Senate committee substitute makes the following changes to 1st edition.
Adds sections to amend or create offenses as follows. Amends GS 14-118.1 to make the violation of simulating a court process or judicial authorization in connection with any claim a Class I felony (was, a Class 2 misdemeanor). Enacts new GS 14-118.6 to make it unlawful to knowingly file a false lien or encumbrance against the real or personal property of a public officer or employee, and makes a violation a Class I felony. Sets out the procedure to follow when a filing is denied and for false liens. Amends GS 14-118.12 to make a person who knowingly, for financial gain, and with intent to defraud, files a document claiming that a mortgage loan has been satisfied or otherwise terminated guilty of residential mortgage fraud. Amends GS 14-401.19 to make it a Class I felony (was, a Class 2 misdemeanor) to file a false security agreement or to file a record for an improper purpose. Makes a conforming change to the bill title. Applies to offenses committed on or after December 1, 2012.
Summary date: Mar 1 2011 - View summary
Amends GS 45-36.11 by adding new subsection (b), which provides an alternate form for secured creditors to use to indicate that the underlying obligation secured by a mortgage or other security instrument has been satisfied. Amends 45-36.21 by adding new subsection (b), which provides an alternate form for trustees and secured creditors to use to indicate that the underlying obligation secured by a deed of trust has been satisfied. Makes technical changes. Effective October 1, 2012, and applies to satisfactions filed on or after that date.