2016 -- S 2365

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LC004640

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO PROPERTY -- FORM AND EFFECT OF CONVEYANCES

     Introduced By: Senators Jabour, Lombardi, Archambault, and McCaffrey

     Date Introduced: February 10, 2016

     Referred To: Senate Judiciary

     It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 34-11 of the General Laws entitled "Form and Effect of

Conveyances" is hereby amended by adding thereto the following section:

     34-11-43. Validation of conveyancing defects. -- (a) Conveyancing defects.

Notwithstanding any other statute to the contrary, any deed, mortgage, lease, power of attorney,

release, assignment or other instrument made for the purpose of conveying, leasing, mortgaging

or affecting any interest in real property in this state, which instrument contains any one or more

of the following defects or omissions is as valid as if it had been executed without the defect or

omission unless an action challenging the validity of that instrument is commenced, and a notice

of lis pendens is recorded in the land evidence records of the city or town where the instrument is

recorded, within two (2) years after the instrument is recorded:

     (1) The instrument contains a defective acknowledgment or no acknowledgment;

     (2) In the case of a conveyance by a corporation, limited liability company, partnership,

limited partnership, or limited liability partnership, or by any other entity authorized to hold and

convey title to real property within this state, the instrument designated such entity as the grantor

but was signed or acknowledged by an individual in such person's individual capacity;

     (3) The instrument was made to any grantee not recognized by law to have the capacity to

take or hold an interest in real property. Validation of an instrument under this subsection

confirms the conveyance to the grantee and any subsequent transfers of the interest by the grantee

to any subsequent transferees, their heirs, administrators, legal representatives, successors and

assigns.

     (b) Insubstantial defects. Notwithstanding any other statute to the contrary, any deed,

mortgage, lease, power of attorney, release, assignment or other instrument made for the purpose

of conveying, leasing, mortgaging or affecting any interest in real property in this state, which

instrument contains any one or more of the following defects or omissions is as valid as if it had

been executed without the defect or omission:

     (1) The instrument contains an incorrect statement of the date of execution or omits the

date of execution;

     (2) The instrument contains an execution date or other date that is later than the date of

recording;

     (3) The instrument transfers an interest in land by reference to a filed map or subdivision

plan and the map or plan does not comply as to preparation, form, certification, approval or filing

with any requirement of any special or general law, municipal ordinance or regulation;

     (4) The record does not disclose the date of recording;

     (5) The instrument fails to state the city or town and state in which the real property

described in the instrument is located;

     (6) In the case of a conveyance by a corporation, limited liability company, partnership,

limited partnership or limited liability partnership, or by any other entity authorized to hold and

convey title to real property within this state, the instrument designates such entity as the grantor

but fails to disclose either the authority of or the office or status held in the entity by the

individual who executes and acknowledges the instrument.

     (c) Defect with respect to a power of attorney. Notwithstanding any other statute to the

contrary, any deed, mortgage, lease, power of attorney, release, assignment or other instrument

made for the purpose of conveying, leasing, mortgaging or affecting any interest in real property

in this state, if the instrument is validly recorded, is executed pursuant to a recorded power of

attorney and contains any one or more of the following defects, is as valid as if the instrument had

been executed without the defect unless an action challenging the validity of the instrument is

commenced and a notice of lis pendens is recorded in the land evidence records of the city or

town where the instrument is recorded within two (2) years after the instrument is recorded:

     (1) The instrument was executed by an attorney-in-fact but was signed or acknowledged

by the attorney-in-fact without reference to their or its capacity;

     (2) The power of attorney was effective at the time the instrument was executed but is

recorded after the instrument is recorded;

     (3) The power of attorney was not effective at the time the instrument was executed, but

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the grant of the power includes a ratification of all prior acts of the attorney-in-fact.

     (d) Defect where fiduciary conveyed to self. Notwithstanding any other statute to the

contrary, any recorded deed, mortgage, lease, release, assignment or other instrument made for

the purpose of conveying, leasing, mortgaging or affecting any interest in real property in this

state, which instrument is executed by a fiduciary, but which instrument is voidable because the

fiduciary is the grantee, mortgagee, lessee, releasee or assignee designated in such instrument, is

as valid as if it had been executed without the defect unless an action is commenced to avoid and

set aside such instrument and a notice of lis pendens is recorded in the land evidence records of

the city or town where the instrument is recorded within ten (10) years from the date of recording

of such instrument.

     (e) Defect with respect to conveyance by fiduciary. Notwithstanding any other statute to

the contrary, any deed, mortgage, lease, power of attorney, release, assignment or other

instrument made for the purpose of conveying, leasing mortgaging or affecting any interest in real

property in this state recorded after the effective date hereof, which instrument was executed by

an executor, administrator, guardian, trustee, conservator or other fiduciary pursuant to an order

or authorization of the probate court and which contains any one or more of the following defects,

is as valid as if it had been executed without the defect:

     (1) The fiduciary failed to post a bond required by the court for the faithful administration

and distribution of the proceeds of the sale, provided either:

     (i) The fiduciary has accounted for the proceeds of the sale in an administration account

that has been approved and accepted by the court after notice and hearing, and from which order

of approval and acceptance no appeal has been taken; or

     (ii) No action challenging the validity of that instrument is commenced and no notice of

lis pendens is recorded in the land evidence records of the city or town where the instrument is

recorded within two (2) years after the instrument is recorded; or

     (iii) The estate is closed; and any appeal time therefrom has elapsed;

     (2) Required notice of the probate court hearing on the application for an order of sale

was not given, provided either:

     (i) The fiduciary has accounted for the proceeds of the sale in an administration account

that has been approved and accepted by the court after notice and hearing, and from which order

of approval and acceptance no appeal has been taken; or

     (ii) No action challenging the validity of the instrument is commenced and no notice of

lis pendens is recorded in the land evidence records of the city or town where the instrument is

recorded within two (2) years after the instrument is recorded; or

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     (iii) The estate is closed; and any appeal time therefrom has elapsed;

     (3) The fiduciary failed to recite in the instrument the basis of the authority by which the

fiduciary acted, provided that no action challenging the validity of the instrument is commenced

and no notice of lis pendens is recorded in the land evidence records of the city or town where the

instrument is recorded within two (2) years after the instrument is recorded.

     (f) Discharge or assignment of mortgage by out-of-state fiduciary. Notwithstanding any

other statute to the contrary, a discharge or assignment of a mortgage interest in real property in

this state held by a nonresident or deceased nonresident that is executed by an out-of-state

fiduciary and recorded after the effective date hereof, shall have the same effect as if executed by

a fiduciary of this state unless an action contesting the discharge or assignment is commenced and

a notice of lis pendens has been recorded in the land evidence records of the city or town where

such release or assignment is recorded within two (2) years after the instrument is recorded.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PROPERTY -- FORM AND EFFECT OF CONVEYANCES

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     This act would eliminate issues with respect to title to real property where certain issues

are otherwise capable of resolution by investigation, preparation and execution of corrective

instruments and recording thereof.

     This act would take effect upon passage.

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