- March 28, 1995
- All California Issuing Offices
- Witness Acknowledgments
Witness acknowledgments have long been a source of claims and losses in the title insurance industry. By their very nature, they invite fraud and forgery. If you are not already aware, please be advised that the California legislature has done a favor for the entire title and escrow industry by enacting a change in Government Code 27287 to be effective January 1, 1995. The change extends the existing prohibition against using witness acknowledgments on deeds of trust and mortgages to include grant deeds other than trustee's deed and deed of reconveyance.
The language of the statute is unclear. It clearly prohibits using witness acknowledgment on grant deed and then proceeds to exclude reconveyance and trustee's deeds from the category of grant deeds. Trustee's deeds are not true grant deeds in the first place because they re made without warranty, express or implied. Likewise, most deeds of reconveyance do not contain the word ?grant? to trigger the statutory warranties implied through Civil Code Section 1113. If these are not grant deeds why are they excluded from the operation of this law? This raises the questions whether the legislature intended to include quitclaim, interspousal transfer, administrator's or other deeds in the prohibition. A request is currently pending in the CLTA Legislative Committee to sponsor legislation amending the statute by clarifying the language.
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.