Bulletin: LA2014010

Date:
December 18, 2014
To:
All Louisiana Issuing Offices
RE:
UNDERWRITING - Recordation of Assignment of Leases and Rents

Dear Associates:

Act 281 of the 2014 Regular Session amended Civil Code Article 3346 (by adding the bolded language). After January 1, 2015, recordations or reinscriptions of assignments of leases and rents as a security device filed in the conveyance office will be TOTALLY INEFECTIVE AS TO THIRD PERSONS AND MAY NOT BE INSURED. Henceforth, all assignments of leases and rents will be recorded in the mortgage office. Inclusion of such assignments in a mortgage document is still a proper method of recording these insurable rights. Reinscription of pre-2015 assignments, which had been filed in the conveyance records, must also be filed in the mortgage records.

Please read the code article and the revision comments by the redactors below.

Article 3346. Place of recordation; duty of the recorder.

A. An instrument creating, establishing, or relating to a mortgage or privilege over an immovable, or the pledge of the lessor's rights in the lease of an immovable and its rents, is recorded in the mortgage records of the parish in which the immovable is located. All other instruments are recorded in the conveyance records of that parish.

B. The recorder shall maintain in the manner prescribed by law all instruments that are recorded with him.

Revision Comments - 2014

Effective as of January 1, 2015, this Article provides that a pledge of the lessor's rights in the lease of an immovable and its rents is recorded in the mortgage records of the parish in which the immovable is located. This represents a change in the law, which formerly required recordation in the conveyance records. For transitional rules applicable to the continued effectiveness of assignments of leases and rents filed in the conveyance records in accordance with former R.S. 9:4401 prior to January 1, 2015, as well as rules that apply to the reinscription, release, transfer, amendment, or other modification of those assignments, see R.S. 9:4403. After January 1, 2015, despite the filing of the original assignment of leases and rents in the conveyance records, an instrument effecting the reinscription, release, transfer, amendment, or other modification of the assignment must be filed in the mortgage records, and a filing in the conveyance records is neither necessary nor effective to cause the instrument to have effect against third persons.

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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