H.B. 16 Enrolled
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7 LONG TITLE
8 General Description:
9 This bill recodifies and amends Title 38, Chapter 9, Wrongful Liens and Wrongful
10 Judgment Liens.
11 Highlighted Provisions:
12 This bill:
13 . defines terms;
14 . requires a document sponsor who submits a nonconsensual common law document
15 to the county recorder for recording to:
16 . cause the sheriff to serve notice of the recording on each affected person; and
17 . initiate a judicial proceeding to determine whether the nonconsensual common
18 law document is enforceable;
19 . provides that a document sponsor who submits an unenforceable nonconsensual
20 common law document to the county recorder for recording is liable to each
21 affected person for any actual damages;
22 . provides that a recorded nonconsensual common law document is void if the
23 document sponsor does not comply with the requirements described in this bill; and
24 . makes technical and conforming changes.
25 Money Appropriated in this Bill:
26 None
27 Other Special Clauses:
28 None
29 Utah Code Sections Affected:
30 AMENDS:
31 38-9a-102 , as enacted by Laws of Utah 2005, Chapter 93
32 76-6-503.5 , as enacted by Laws of Utah 2005, Chapter 93
33 78B-5-201 , as last amended by Laws of Utah 2011, Chapter 88
34 78B-5-408 , as last amended by Laws of Utah 2011, Chapter 88
35 ENACTS:
36 38-9-101 , Utah Code Annotated 1953
37 38-9-201 , Utah Code Annotated 1953
38 38-9-301 , Utah Code Annotated 1953
39 38-9-302 , Utah Code Annotated 1953
40 38-9-303 , Utah Code Annotated 1953
41 38-9-304 , Utah Code Annotated 1953
42 38-9-305 , Utah Code Annotated 1953
43 RENUMBERS AND AMENDS:
44 38-9-102 , (Renumbered from 38-9-1, as last amended by Laws of Utah 2010, Chapter
45 381)
46 38-9-103 , (Renumbered from 38-9-2, as last amended by Laws of Utah 2012, Chapter
47 278)
48 38-9-202 , (Renumbered from 38-9-3, as last amended by Laws of Utah 2010, Chapter
49 381)
50 38-9-203 , (Renumbered from 38-9-4, as last amended by Laws of Utah 2010, Chapter
51 381)
52 38-9-204 , (Renumbered from 38-9-6, as enacted by Laws of Utah 1997, Chapter 125)
53 38-9-205 , (Renumbered from 38-9-7, as enacted by Laws of Utah 1997, Chapter 125)
54
55 Be it enacted by the Legislature of the state of Utah:
56 Section 1. Section 38-9-101 is enacted to read:
57
58
59 38-9-101. Title.
60 (1) This chapter is known as the "Wrongful Lien Act."
61 (2) This part is known as "General Provisions."
62 Section 2. Section 38-9-102 , which is renumbered from Section 38-9-1 is renumbered
63 and amended to read:
64 [
65 As used in this chapter:
66 (1) "Affected person" means:
67 (a) a person who is a record interest holder of the real property that is the subject of a
68 recorded nonconsensual common law document; or
69 (b) the person against whom a recorded nonconsensual common law document
70 purports to reflect or establish a claim or obligation.
71 (2) "Document sponsor" means a person who, personally or through a designee, signs
72 or submits for recording a document that is, or is alleged to be, a nonconsensual common law
73 document.
74 [
75 property interest in certain real property, including an owner, title holder, mortgagee, trustee, or
76 beneficial owner.
77 [
78 offers a document for recording or filing with any county recorder in the state asserting a lien,
79 or notice of interest, or other claim of interest in certain real property.
80 (5) "Nonconsensual common law document" means a document that is submitted to a
81 county recorder's office for recording against public official property that:
82 (a) purports to create a lien or encumbrance on or a notice of interest in the real
83 property;
84 (b) at the time the document is recorded, is not:
85 (i) expressly authorized by this chapter or a state or federal statute;
86 (ii) authorized by or contained in an order or judgment of a court of competent
87 jurisdiction; or
88 (iii) signed by or expressly authorized by a document signed by the owner of the real
89 property; and
90 (c) is submitted in relation to the public official's status or capacity as a public official.
91 [
92 property.
93 (7) "Political subdivision" means a county, city, town, school district, special
94 improvement or taxing district, local district, special service district, or other governmental
95 subdivision or public corporation.
96 (8) "Public official" means:
97 (a) a current or former:
98 (i) member of the Legislature;
99 (ii) member of Congress;
100 (iii) judge;
101 (iv) member of law enforcement;
102 (v) corrections officer;
103 (vi) active member of the Utah State Bar; or
104 (vii) member of the Board of Pardons and Parole;
105 (b) an individual currently or previously appointed or elected to an elected position in:
106 (i) the executive branch of state or federal government; or
107 (ii) a political subdivision;
108 (c) an individual currently or previously appointed to or employed in a position in a
109 political subdivision, or state or federal government that:
110 (i) is a policymaking position; or
111 (ii) involves:
112 (A) purchasing or contracting decisions;
113 (B) drafting legislation or making rules;
114 (C) determining rates or fees; or
115 (D) making adjudicative decisions; or
116 (d) an immediate family member of a person described in Subsections (8)(a) through
117 (c).
118 (9) "Public official property" means real property that has at least one record interest
119 holder who is a public official.
120 [
121 present, lawful property interest in [
122 mortgagee, trustee, or beneficial owner, and whose name and interest in that real property
123 appears in the county recorder's records for the county in which the property is located.
124 (b) "Record interest holder" includes any grantor in the chain of the title in [
125 real property.
126 [
127 certain real property is recorded or filed in the county recorder's records for the county in which
128 the property is located.
129 [
130 interest, or encumbrance on an owner's interest in certain real property and at the time it is
131 recorded is not:
132 (a) expressly authorized by this chapter or another state or federal statute;
133 (b) authorized by or contained in an order or judgment of a court of competent
134 jurisdiction in the state; or
135 (c) signed by or authorized pursuant to a document signed by the owner of the real
136 property.
137 Section 3. Section 38-9-103 , which is renumbered from Section 38-9-2 is renumbered
138 and amended to read:
139 [
140 [
141
142
143 [
144
145 [
146 chapter [
147 filed before May 5, 2008.
148 (2) [
149
150 not prevent a person from seeking any other relief permitted by law.
151 (3) This chapter does not apply to a person entitled to a preconstruction or construction
152 lien under Section 38-1a-301 who files a lien pursuant to Title 38, Chapter 1a, Preconstruction
153 and Construction Liens.
154 Section 4. Section 38-9-201 is enacted to read:
155
156 38-9-201. Title.
157 This part is known as "Recording a Wrongful Lien."
158 Section 5. Section 38-9-202 , which is renumbered from Section 38-9-3 is renumbered
159 and amended to read:
160 [
161 employment -- Good faith requirement.
162 (1) (a) A county recorder may [
163 recorder determines that the lien is a wrongful lien [
164 (b) If the county recorder [
165 with Subsection (1)(a), the county recorder shall immediately return the original document
166 together with a notice that the document was rejected pursuant to this section to the person
167 attempting to record the document or to the address provided on the document.
168 (2) A county recorder who, within the scope of the county recorder's employment,
169 rejects or accepts a document for recording in good faith under this section is not liable for
170 damages.
171 (3) If a [
172 is later found not to be [
173 retroactive recording priority.
174 (4) Nothing in this chapter [
175 remedy pursuant to Utah Rules of Civil Procedure, Rule 65A, Injunctions.
176 Section 6. Section 38-9-203 , which is renumbered from Section 38-9-4 is renumbered
177 and amended to read:
178 [
179 (1) A lien claimant who records or causes a wrongful lien [
180
181 record interest holder for any actual damages proximately caused by the wrongful lien.
182 (2) If the person in violation of Subsection (1) refuses to release or correct the wrongful
183 lien within 10 days from the date of written request from a record interest holder of the real
184 property delivered personally or mailed to the last-known address of the lien claimant, the
185 person is liable to that record interest holder for $3,000 or for treble actual damages, whichever
186 is greater, and for reasonable attorney fees and costs.
187 (3) A person is liable to the record owner of real property for $10,000 or for treble
188 actual damages, whichever is greater, and for reasonable attorney fees and costs, who records
189 or causes to be recorded a wrongful lien [
190 county recorder against the real property, knowing or having reason to know that the document:
191 (a) is a wrongful lien;
192 (b) is groundless; or
193 (c) contains a material misstatement or false claim.
194 Section 7. Section 38-9-204 , which is renumbered from Section 38-9-6 is renumbered
195 and amended to read:
196 [
197 Summary relief -- Contested petition.
198 (1) A lien claimant whose document is rejected pursuant to Section [
199 may petition the district court [
200 expedited determination that the lien may be recorded [
201 (2) [
202
203
204 (a) be filed:
205 (i) with the district court in the county of the county recorder who refused to record the
206 document; and
207 (ii) within 10 days after the day on which the person who files the petition receives the
208 notice under Subsection 38-9-202 (1)(b) of the county recorder's refusal to record the document;
209 (b) state with specificity the grounds why the document should lawfully be recorded;
210 and
211 [
212 [
213 a hearing.
214 [
215 mail, serve a copy of the petition, notice of hearing, and a copy of the court's order granting an
216 expedited hearing on all record interest holders of the property sufficiently in advance of the
217 hearing to enable any record interest holder to attend the hearing [
218
219 [
220 the petition.
221 [
222 finds that the document may lawfully be recorded, [
223 the county recorder to accept the document for recording. [
224
225 (b) If the petition is contested, the court may award costs and reasonable attorney fees
226 to the prevailing party.
227 [
228
229
230
231
232
233
234 (i) may only determine whether a contested document, on its face, shall be recorded by
235 the county recorder; and
236 (ii) may not determine the truth of the content of the document or the property or legal
237 rights of the parties beyond the necessary determination of whether the document shall be
238 recorded.
239 (b) A court's grant or denial of a petition under this section may not restrict any other
240 legal remedies of any party, including any right to injunctive relief pursuant to Rules of Civil
241 Procedure, Rule 65A, Injunctions.
242 [
243 [
244 section.
245 Section 8. Section 38-9-205 , which is renumbered from Section 38-9-7 is renumbered
246 and amended to read:
247 [
248 Summary relief -- Finding of wrongful lien -- Wrongful lien is void.
249 (1) [
250
251 which the document [
252 (2) The petition described in Subsection (1) shall state with specificity the claim that
253 the lien is a wrongful lien and shall be supported by a sworn affidavit of the record interest
254 holder.
255 (3) (a) If the court finds the petition insufficient, [
256 without a hearing.
257 (b) If the court finds the petition is sufficient, the court shall schedule a hearing within
258 10 days to determine whether the document is a wrongful lien.
259 (c) The record interest holder shall serve a copy of the petition on the lien claimant and
260 a copy of a notice of the hearing pursuant to Rules of Civil Procedure, Rule 4, Process.
261 (d) The lien claimant is entitled to attend and contest the petition.
262 (4) A summary proceeding under this section [
263
264
265 (a) may only determine whether a document is a wrongful lien; and
266 (b) may not determine any other property or legal rights of the parties or restrict other
267 legal remedies of any party.
268 (5) (a) [
269 determines that the recorded document is a wrongful lien, the court shall issue an order
270 declaring the wrongful lien void ab initio, releasing the property from the lien, and awarding
271 costs and reasonable [
272 (b) (i) The record interest holder may [
273 [
274 (ii) The order shall contain a legal description of the real property.
275 (c) If the court determines that the claim of lien is valid, the court shall dismiss the
276 petition and may award costs and reasonable attorney's fees to the lien claimant. The dismissal
277 order shall contain a legal description of the real property. The prevailing lien claimant may
278 record a certified copy of the dismissal order.
279 (6) If the [
280 lien [
281 claim or interest.
282 (7) If [
283 proceedings related to the claim for damages may not be expedited under this section.
284 Section 9. Section 38-9-301 is enacted to read:
285
286 38-9-301. Title.
287 This part is known as "Recording a Nonconsensual Common Law Document."
288 Section 10. Section 38-9-302 is enacted to read:
289 38-9-302. Recording a nonconsensual common law document -- Procedure.
290 (1) For a nonconsensual common law document recorded on or after May 13, 2014,
291 within five business days after the day on which an individual submits a nonconsensual
292 common law document to a county recorder for recording, the individual shall cause the sheriff
293 to serve written notice of the recording of the nonconsensual common law document upon each
294 affected person.
295 (2) A written notice described in Subsection (1) shall include:
296 (a) the name, address, and telephone number of the document sponsor;
297 (b) the date the nonconsensual common law document was recorded; and
298 (c) a copy of the nonconsensual common law document.
299 (3) (a) No later than three business days after the day on which the sheriff serves the
300 written notice described in Subsection (1), the sheriff shall submit proof of service to the
301 county recorder for recording.
302 (b) The county recorder may not charge a fee for recording a proof of service under
303 Subsection (3)(a).
304 Section 11. Section 38-9-303 is enacted to read:
305 38-9-303. Enforcement proceeding required.
306 (1) For a nonconsensual common law document recorded on or after May 13, 2014,
307 within 10 business days after the day on which a document sponsor submits a nonconsensual
308 common law document to the county recorder for recording, the document sponsor shall file a
309 complaint in district court in the county of the county recorder where the nonconsensual
310 common law document was recorded for a proceeding to obtain an order that the
311 nonconsensual common law document is valid and enforceable.
312 (2) A complaint to initiate a judicial proceeding described in Subsection (1) shall:
313 (a) state with specificity the grounds that make the nonconsensual common law
314 document valid and enforceable;
315 (b) be supported by the document sponsor's sworn affidavit; and
316 (c) name each affected person as an opposing party.
317 (3) If the court finds that a complaint filed under Subsection (1) does not meet the
318 requirements described in Subsection (2), the court may dismiss the complaint without a
319 hearing.
320 (4) If a complaint filed under Subsection (1) meets the requirements described in
321 Subsection (2), the court:
322 (a) shall hold a hearing;
323 (b) following the hearing, shall issue an order that:
324 (i) states whether the nonconsensual common law document is valid and enforceable;
325 and
326 (ii) includes a legal description of the real property that is the subject of the complaint;
327 and
328 (c) may award costs and reasonable attorney fees to the prevailing party.
329 (5) Within three business days after the day on which the court issues a final order in a
330 proceeding under this section, the prevailing party shall submit a copy of the court's final order
331 to the county recorder for recording.
332 (6) A nonconsensual common law document is presumed invalid and unenforceable.
333 (7) A person's lack of belief in the jurisdiction or authority of the state or of the
334 government of the United States is not a defense to liability under this section.
335 (8) A court's order in a proceeding under this section does not restrict any other legal
336 remedies available to any party, including any right to injunctive relief under Rules of Civil
337 Procedure, Rule 65A, Injunctions.
338 Section 12. Section 38-9-304 is enacted to read:
339 38-9-304. Civil liability -- Damages.
340 (1) If, under Section 38-9-303 , a court finds that a recorded nonconsensual common
341 law document is unenforceable, the document sponsor of the nonconsensual common law
342 document is liable to each affected person for any actual damages proximately caused by
343 recording the nonconsensual common law document, costs, and reasonable attorney fees.
344 (2) A person who is liable under Subsection (1) for a nonconsensual common law
345 document is jointly and severally liable with each other person who is liable for the
346 nonconsensual common law document.
347 Section 13. Section 38-9-305 is enacted to read:
348 38-9-305. Failure to comply -- Nonconsensual common law document void.
349 A recorded nonconsensual common law document that is recorded on or after May 13,
350 2014, is void and has no legal effect if the document sponsor does not:
351 (1) comply with the notice requirements described in Section 38-9-302 ;
352 (2) comply with the judicial enforcement requirements described in Section 38-9-303 ;
353 and
354 (3) prevail in a judicial enforcement proceeding under Section 38-9-303 .
355 Section 14. Section 38-9a-102 is amended to read:
356 38-9a-102. Definitions.
357 As used in this chapter, "wrongful lien" refers to a lien made in violation of Section
358 76-6-503.5 , and includes [
359 (1) a wrongful lien as defined in Section 38-9-102; and
360 (2) a nonconsensual common law document as defined in Section 38-9-102 .
361 Section 15. Section 76-6-503.5 is amended to read:
362 76-6-503.5. Wrongful liens and fraudulent handling of recordable writings --
363 Penalties.
364 (1) "Lien" means:
365 (a) an instrument or document filed pursuant to Section 70A-9a-516 ;
366 (b) a nonconsensual common law document as defined in Section 38-9-102 ;
367 [
368 wrongful lien as defined in Section 38-9-102 ; or
369 [
370 encumbrance on an owner's interest in real or personal property or a claim on another's assets.
371 (2) A person is guilty of the crime of wrongful lien if that person knowingly makes,
372 utters, records, or files a lien:
373 (a) having no objectively reasonable basis to believe he has a present and lawful
374 property interest in the property or a claim on the assets; or
375 (b) if the person files the lien in violation of a civil wrongful lien injunction pursuant to
376 Title 38, Chapter 9a, Wrongful Lien Injunctions.
377 (3) A violation of this section is a third degree felony unless the person has been
378 previously convicted of an offense under this section, in which case the violation is a second
379 degree felony.
380 (4) (a) Any person who with intent to deceive or injure anyone falsifies, destroys,
381 removes, records, or conceals any will, deed, mortgage, security instrument, lien, or other
382 writing for which the law provides public recording is guilty of fraudulent handling of
383 recordable writings.
384 (b) A violation of Subsection (4)(a) is a third degree felony unless the person has been
385 previously convicted of an offense under this section, in which case the violation is a second
386 degree felony.
387 (5) This section does not prohibit prosecution for any act in violation of Section
388 76-8-414 or for any offense greater than an offense under this section.
389 Section 16. Section 78B-5-201 is amended to read:
390 78B-5-201. Definitions -- Judgment recorded in Registry of Judgments.
391 (1) For purposes of this part, "Registry of Judgments" means the index where a
392 judgment is filed and searchable by the name of the judgment debtor through electronic means
393 or by tangible document.
394 (2) On or after July 1, 1997, a judgment entered in a district court does not create a lien
395 upon or affect the title to real property unless the judgment is filed in the Registry of Judgments
396 of the office of the clerk of the district court of the county in which the property is located.
397 (3) (a) On or after July 1, 2002, except as provided in Subsection (3)(b), a judgment
398 entered in a district court does not create a lien upon or affect the title to real property unless
399 the judgment or an abstract of judgment is recorded in the office of the county recorder in
400 which the real property of the judgment debtor is located.
401 (b) State agencies are exempt from the recording requirement of Subsection (3)(a).
402 (4) In addition to the requirements of Subsections (2) and (3)(a), any judgment that is
403 filed in the Registry of Judgments on or after September 1, 1998, or any judgment or abstract
404 of judgment that is recorded in the office of a county recorder after July 1, 2002, shall include:
405 (a) the information identifying the judgment debtor on the judgment or abstract of
406 judgment; or
407 (b) a copy of the separate information statement of the judgment creditor that contains:
408 (i) the correct name and last-known address of each judgment debtor and the address at
409 which each judgment debtor received service of process;
410 (ii) the name and address of the judgment creditor;
411 (iii) the amount of the judgment as filed in the Registry of Judgments;
412 (iv) if known, the judgment debtor's Social Security number, date of birth, and driver's
413 license number if a natural person; and
414 (v) whether or not a stay of enforcement has been ordered by the court and the date the
415 stay expires.
416 (5) For the information required in Subsection (4), the judgment creditor shall:
417 (a) provide the information on the separate information statement if known or available
418 to the judgment creditor from its records, its attorney's records, or the court records in the
419 action in which the judgement was entered; or
420 (b) state on the separate information statement that the information is unknown or
421 unavailable.
422 (6) (a) Any judgment that requires payment of money and is entered in a district court
423 on or after September 1, 1998, or any judgment or abstract of judgment recorded in the office
424 of a county recorder after July 1, 2002, that does not include the debtor identifying information
425 as required in Subsection (4) is not a lien until a separate information statement of the
426 judgment creditor is recorded in the office of a county recorder in compliance with Subsections
427 (4) and (5).
428 (b) The separate information statement of the judgment creditor referred to in
429 Subsection (6)(a) shall include:
430 (i) the name of any judgment creditor, debtor, assignor, or assignee;
431 (ii) the date on which the judgment was recorded in the office of the county recorder as
432 described in Subsection (4); and
433 (iii) the county recorder's entry number and book and page of the recorded judgment.
434 (7) A judgment that requires payment of money recorded on or after September 1,
435 1998, but prior to July 1, 2002, has as its priority the date of entry, except as to parties with
436 actual or constructive knowledge of the judgment.
437 (8) A judgment or notice of judgment wrongfully filed against real property is subject
438 to Title 38, Chapter 9, Wrongful [
439 (9) (a) To release, assign, renew, or extend a lien created by a judgment recorded in the
440 office of a county recorder, a person shall, in the office of the county recorder of each county in
441 which an instrument creating the lien is recorded, record a document releasing, assigning,
442 renewing, or extending the lien.
443 (b) The document described in Subsection (9)(a) shall include:
444 (i) the date of the release, assignment, renewal, or extension;
445 (ii) the name of any judgment creditor, debtor, assignor, or assignee; and
446 (iii) for the county in which the document is recorded in accordance with Subsection
447 (9)(a):
448 (A) the date on which the instrument creating the lien was recorded in that county's
449 office of the county recorder; and
450 (B) in accordance with Section 57-3-106 , that county recorder's entry number and book
451 and page of the recorded instrument creating the judgment lien.
452 Section 17. Section 78B-5-408 is amended to read:
453 78B-5-408. Judgments and awards on foreign-money claims -- Time of money
454 conversion -- Form of judgment.
455 (1) Except as provided in Subsection (3), a judgment or arbitration award on a
456 foreign-money claim must be stated in an amount of the money of the claim.
457 (2) The judgment or award is payable in that foreign money or at the option of the
458 debtor in the amount of United States dollars which will purchase that foreign money on the
459 conversion date at a bank-offered spot rate.
460 (3) Assessed costs must be entered in United States dollars.
461 (4) Each payment in United States dollars must be accepted and credited on the
462 judgment or award in the amount of the foreign money that could be purchased by the dollars at
463 a bank-offered spot rate of exchange at or near the close of business on the conversion date for
464 that payment.
465 (5) Judgments or awards made in an action on both:
466 (a) a defense, set-off, recoupment, or counterclaim; and
467 (b) the adverse party's claim, must be netted by converting the money of the smaller
468 into the money of the larger, and by subtracting the smaller from the larger, and must specify
469 the rates of exchange used.
470 (6) A judgment substantially in the following form complies with Subsection (1):
471 IT IS ADJUDGED AND ORDERED that Defendant (insert name) pay to Plaintiff
472 (insert name) the sum of (insert amount in the foreign money) plus interest on that sum at the
473 rate of (insert rate - see Section 78B-5-410 ) percent a year or, at the option of the judgment
474 debtor, the number of United States dollars as will purchase the (insert name of foreign money)
475 with interest due, at a bank-offered spot rate at or near the close of business on the banking day
476 next before the day of payment, together with assessed costs of (insert amount) United States
477 dollars.
478 (7) If a contract claim is of the type covered by Subsection 78B-5-406 (1) or (2), the
479 judgment or award shall be entered for the amount of the money stated to measure the
480 obligation to be paid in the money specified for payment or, at the option of the debtor, the
481 number of United States dollars as will purchase the computed amount of the money of
482 payment on the conversion date at a bank-offered spot rate.
483 (8) A judgment shall be filed in the judgment docket and indexed in foreign money in
484 the same manner, and shall have the same effect as a lien as other judgments. It may be
485 discharged by payment.
486 (9) A person shall record a judgment lien, or assignment, release, renewal, or extension
487 of a judgment lien, in the county recorder's office in accordance with [
488
489 (a) Sections 17-21-10 , 78B-5-201 , and 78B-5-202 ; and
490 (b) Title 38, Chapter 9, Wrongful Lien Act.
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