Authorizes recording officers to accept conveyance of real property presented for recording as electronic records

Summary of provisions

Section 1 of this bill would amend State Technology Law ("STL") § 307 to remove a provision that makes the Electronic Signature and Records Act ("ESRA") inapplicable to conveyances or other instruments recordable under Real Property Law ("RPL") Article 9.

Section 2 of this bill would amend RPL § 290, to include definitions of terms used in the new RPL § 291-i, added by section 3 of this bill.

Section 3 of this bill would amend RPL Article 9 to add a new § 291-i that would confirm the validity of digitized paper documents, electronic records, electronic signatures and electronic notarization, as follows:

* RPL § 291-i(1) would provide that where a law, rule or regulation requires, as a condition of recording, that an instrument be a signed and notarized paper original, the requirement is satisfied by a digitized paper document or an electronic record that has been electronically signed and notarized. * RPL § 291-i(2) would provide the form for an Affirmation Concerning Digitized Paper Documents Presented for Recording or Filing. * RPL § 291-i(3) would provide that nothing in RPL § 291-i shall be construed to require electronic recording. * RPL § 291-i(4) would provide that where any recording officer permits electronic recording pursuant to RPL § 291-i, it must be in accordance with the rules, regulations, guidelines, standards and policies established by the New York State Office For Technology ("OFT"). * RPL § 291-i(5) would provide that to ensure consistency in the practices and technology used by county clerks in the state, OFT would promulgate rules, regulations, guidelines, standards and policies, as appropriate, governing the use and acceptance of digitized paper documents, electronic records and electronic signatures under RPL Article 9.

* RPL § 291-i(7) would provide that recording officers must continue to furnish the State Office of Real Property Services ("ORPS") with paper documents of reports required by Real Property Tax Law § 574, unless ORPS agrees to accept data submissions in lieu thereof or has provided for the electronic transmission of such data pursuant to law.

Section 4 of this bill would amend RPL § 317 to provide that a digitized paper document or an electronic record would be considered delivered for purposes of RPL § 317 at the date and time of receipt indicated on an electronic or other written notification provided by the recording officer immediately upon receipt of a digitized paper document or electronic record.

Section 5 of this bill would amend CPLR § 802] (a)(4)(a)(1), to provide that no fee would be charged for a page transmitted for recording that contains the Affirmation Concerning Digitized Paper Documents Presented for Recording or Filing required pursuant to RPL § 291 -i(2).

Section 6 of this bill would make it effective 270 days after it becomes a law, provided, however, that OFT would be authorized to promulgate rules, regulations, guidelines, standards and policies to effectuate the bill prior to such effective date.

Prior legislative history

None.

Existing law

STL § 307(3) makes ESRA inapplicable to any conveyance or other instrument recordable under RPL Article 9.

RPL Article 9 provides for the recording of hard-copy instruments affecting real property, but does not authorize the use of digitized paper documents, electronic records and electronic signatures for such recording.

Statement in support

This bill responds to the ongoing challenge of local governments to deliver more services with fewer resources. County clerks are continually seeking ways to improve efficiency, enhance services and save taxpayer dollars. This bill would permit, but not mandate, the application of information and communication technologies to support their activities related to the recording of instruments affecting real property.

In the past several years, virtually all businesses have become, to some degree or another, e-businesses. Internet technology and readily available solutions have made e-business ubiquitous. Government has experienced a parallel trend. For example, the New York State

Unified Court System has established "NYSCEF," a program that permits the filing and service of legal papers by electronic means with certain county clerks, and with courts in certain types of cases. This bill seeks to achieve similar efficiencies in the realm of real property conveyances by enabling county governments to modernize the manner in which real estate professionals and recording officers conduct their business together.

By implementing electronic recording, a local government would be able to reduce the volume of paper documents coming into the recorder's office. Moreover, local governments that permit electronic recording stand to save considerable money on personnel and postage for returning documents. Finally, electronic recording would improve the accuracy and speed of recording.

As a result of the State's enactment of ESRA and the federal government's enactment of the Electronic Signatures in Global and National Commerce Act ("E-Sign")(15 U.S.C. 7001 et seq.), it is now possible to use or accept electronic records and signatures in the State and in interstate or foreign commercial transactions. Currently, however, ESRA does not apply to any real property conveyance or other instrument recordable under RPL Article 9, and E-Sign does not otherwise require such electronic recording of land documents. Moreover, the RPL limits recordable documents to ones that are in writing or on paper, and requires signatures to be in writing and acknowledgements to be signed.

This bill is based on the Uniform Real Property Electronic Recording Act (URPERA), model legislation promulgated by the National Conference of Commissioners on Uniform State Laws in 2004, which has been enacted in 24 states to clearly permit electronic recording ofland documents. It would empower recording officers to implement electronic recording and provide greater clarity for the authority to do so when compared with existing law. This bill would authorize two types of electronic recording transactions:

1. the digitizing of original paper documents that would be submitted to the county clerk for recording purposes through an online transaction; and 2. the creation of electronically signed data records that would be submitted to the county clerk for recording purposes through an online transaction.

The fundamental purpose of this bill is to clarify the authorization for land records officials to accept records in electronic form, storing electronic records, and setting up systems for searching for and retrieving these land records.

This bill would modernize the real estate transaction process. Owners of real property, real estate professionals, and local government taxpayers would benefit from the more accurate and efficient land

records system that this bill would facilitate. This bill would also eliminate the need for persons seeking to record land documents to appear at the offices of recording officers to file hard-copy originals, and it would provide for a more efficient and streamlined storage and retrieval system. Ultimately, electronic recording will improve the recording process from the point of origin (e.g., title companies, banks, attorney's offices) to county clerks' offices. It will improve work flow, increase productivity, speed up the recording process and improve data accuracy.

Budget implications

This bill has no fiscal implications for the State. Depending on the level of participation in each county, the receipt of electronic records or digitized documents for recording would enable county clerk offices to attain potentially significant savings from the elimination of document scanning and the reduction in time and supplies necessary to return documents to their custodians after the original copies have been recorded.

Effective date

This bill would take effect 270 days after it becomes a law.