Bulletin: MT2013001

Date:
October 24, 2013
To:
All Montana Issuing Offices
RE:
LEGISLATIVE UPDATES - Montana Legislation - 2013

Dear Associates:

The following are summaries of some of the bills passed during the 2013 legislative session of interest to the title insurance industry.

HB-117 - This bill revises the Regulation of Escrow Business Act by changing references to the Director of the Department of Administration to the Department itself. It eliminates the exemption to escrow business licensing for licensed mortgage brokers, mortgage lenders and mortgage servicers who provide escrow services beyond those relating to residential mortgage loan agreements. Now exempt from the provisions of the act are loan closers who are employed by an exempt financial institution or are independent contractors who only act as a courier and do not take possession of funds for deposit or disbursement. The bill makes changes to the application requirements. The annual license renewal fee is $100 and the escrow business license now runs from January 1 through December 31 of the same year. A license is not transferrable or assignable including in cases where the ownership of a licensed escrow business entity changes ownership involving a change of control in the entity by a transfer of 25% or more of the ownership interests in the entity. Licensees must annually file with the department a statement of its escrow activities and financial condition during the prior year by December 31. Finally, the department may impose penalties of up to $1,000 for each violation plus costs and possibly restitution as well as revocation or suspension of the license.

HB-245 - Provides that the board of county commissioners may dedicate county land to the public as county park land but cannot sell, lease or exchange such park land except in accordance with current statutes.

HB-362 - Amends the limited liability company laws by authorizing the creation of “series of members” within a limited liability company. A series of members may have separate members, managers, assets, liabilities, and business purposes. The existence of a series of members must be specified in the articles of organization or operating agreement along with the powers and managers of the series.

HB-469 - Provides that parties to a construction lien may agree, either before or after the lien is created, to enter into arbitration if a dispute arises between the parties with respect to the construction lien.

SB-18 - This bill provides for the ownership of a channel and former channel of a navigable river or stream following an avulsion. It also creates a process to clarify ownership after an avulsion of abandoned beds of rivers and streams not previously adjudicated for title. The procedures vary depending on whether the river or stream bed had previously been adjudicated as navigable or not. Court action will be required in many cases.

SB-207 - This bill provides the method for partitioning heirs property held by tenants in common, one or more of whom acquired their interest from a relative, some of whom are related, and who do not have an agreement between them that governs the partition of the property. It contains provisions for the determination of the value of the property, possible buyout by a cotenant, partition alternatives, partition in kind, and sale of the property.

SB-251 - This bill repeals the current Montana Trust Code and replaces it with 161 sections of The Montana Uniform Trust Code. The provisions of this statute cover a wide variety of matters relating to trust creation, administration, co-trustees, successor trustees, powers of a trustee and other things. It provides that, subject to any spendthrift provision, a court may authorize a creditor of a beneficiary to reach the beneficiary’s interest in present or future distributions by attachment. The statute provides that trust property is not subject to personal obligations of the trustee. Other parts provide that a “certification of trust” can be provided to a party that is interested in the trust’s provisions instead of a full copy of the trust. A person who demands to see the full trust agreement may be liable for damages if the request is not made in good faith.

SB-316 - This bill provides that where a local board of health regulates water well drilling the regulations must prohibit the drilling if an area 100 feet from the well would encroach onto adjacent property unless that property owner consents. A new subdivision cannot be approved with such an encroachment or the encroachment of any other features or improvements of the subdivision onto adjoining property without consent.

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