Winter 2016

President's Message
NC/SC Boundary Re-Certification
Legislative Update
From the Editor
President's Message by Karl Knight


Next week our annual convention kicks off at Wild Dunes on the Isle Palms.  Always a favorite destination for our membership, this year’s convention promises to be jammed packed with opportunities to socialize, network, and get educated from the opening Welcome Reception on Thursday evening through the last meeting on Saturday.  Incoming President Tara Eudy, along with Executive Director Tracy Steadman, have put together a great line-up.  We’ll hear from the North Carolina State Bureau of Investigations about fraudster’s operating in North Carolina, the Department of Insurance on industry regulation, ethics, case law, recent legislation, and get a national industry perspective from the American Land Title Association.  Golfing, the beaches, and nearby Charleston promise to provide endless hours of fun and relaxation.  Looking forward to seeing all of you there.
It’s now late August, still baseball season, so I hope you’ll bear with me while I wax baseball for my final message. 
The great philosopher-coach Lawrence Peter Berra (a/k/a “Yogi”) is attributed with the following advice, “When you get to a fork in the road, take it.”  That always seemed a little ridiculous to me.  If I need directions, I need directions; but your best advice is “take it?”  That’s all you got for me?  Well, yes, actually.  Yogi’s point had less to do with making a wrong decision and more to do with moving forward.  His point was whether you move left or right, you gotta move … forward.  Sure you’ll make a mistake or two, but that’s how you learn.  But without moving forward you’ll never end up where you need to be. 
This time last year Lisa Shields left us in great shape, having led us through a successful 2014-15.  Fortunately the way forward was made clear thanks not only to Lisa’s continuing leadership, but also with guidance provided by all of the Board, and valuable input from many of you, the membership.  While the legislative session was one of the shortest in history this year, NCLTA managed to get us relief on manufactured housing liens and uniform recording fees; the later effort getting national recognition as moving in right direction for settlement agents and lenders having to comply with the new federal regulations imposed by TRID.  That while not getting hurt too badly by potential pot-holes in other legislation.  So all-in-all I’d say we had good pitching (offense) and good fielding (defense). 
So let me thank the team: 

  • Thank you to the current Board members without whose experience and encouragement this year would not have been nearly as successful.  Thank you to Jay Williams, Lisa Shields, Tara Eudy, Marc Garren, Ben Ipock, and Randy Underwood.  You guys make up a great Board and I’m looking forward to working with you another year.  
  • Thanks again to Joe Ritter, Kim Rosenberg, and Nick Long for their service on the Legislative Committee this year.  You guys always have a lot on your plate and your tireless work on our behalf has not gone unnoticed.   
  • Thank you Nancy Ferguson for coordinating between NCLTA, the Real Property Council, and RELANC, especially on NC/SC boundary issues. 
  • Thanks to our lobbyist David Ferrell, ever the consummate gentleman and patient-explainer (o.k., David, one more time – how exactly does this manufactured housing legislation work?).  
  • And a special thank you to Tracy Steadman for her hard work as Executive Director. Tracy is an excellent “cat- herder,” managing to keep us all moving past the fork this past year. 

And lastly, thank you Membership. Thank you for allowing me to serve as your association President this past year.  I look forward to continuing to work with Team-NCLTA.  See you at Isle of Palms on September 15th
All the best,
Karl Knight, President NCLTA

NC/SC Boundary Re-Certification





For over 20 years, North Carolina and South Carolina have been negotiating, researching, surveying and documenting the true historical line between the states, through their respective Geodetic Survey offices.  In May, 2013, the final survey for the entire 334 mile border was adopted by the Joint Boundary Commission, completing the re-survey using modern methods based on historical records and data.  In 2016, both legislatures for their respective state adopted legislation to address the many issues affected by this determination, with important provisions regarding real estate titles and foreclosures.


Representatives from many groups involved in the real estate industry (NCLTA, Real Property Section, RELANC, NCAR, NC Bankers Association, NCARD, Secretary of State Land Records Division,  have been meeting to discuss the issues since prior to the completion of the surveys.  And effort was made to obtain guidance in the legislation as to the effect on real estate titles that will be affected.


In an effort to provide guidance to all participants in the real estate industry whose clients may be affected by this re-survey, the below article has been drafted and is proposed to be circulated (when final) to as many industry participants as possible, in hopes of minimizing the disruption to titles and closing as much as possible (absent curative legislation and litigation).


WE WELCOME THE INPUT OF INDUSTRY PARTICIPANTS!  For those of you who may be involved in any title that may be on or near the North Carolina – South Carolina Boundary, please do read, discuss, and provide comment!  We look forward to hearing from you!  Send emails to or call 1-800-445-9983.  We look forward to hearing from you!





TO:  Any attorney, real estate broker, mortgage lender, appraiser, surveyor, title insurer or others involved with real estate closings on real properties directly affected by the re-survey


DATE:            September 1, 2016


The North Carolina-South Carolina boundary was resurveyed, with final surveys available in 2015, based on historical monumentation and research back to original colonial records.  Some parcels (or portions of larger tracts) previously believed to be in South Carolina are now found to be in North Carolina, and vice versa. Anyone involved with properties directly affected by the re-survey should be sure to discuss title issues and the necessary certifications of title in detail with professionals who are knowledgeable about the many legal issues involved in these titles, -- whether the property is now all in North Carolina or is still partially in South Carolina.


From a real estate title perspective, these are uncharted waters.  Interpretations of applicable law and solutions to issues are not transparent.  So caution and due diligence is critical, as discussed below.


With regard to properties (in whole or in part) now found to be located in North Carolina, but formerly believed to be in South Carolina (the “NC affected property”), Session Law 2016-23 addresses matters as diverse as voting, schools, license, in-state tuition, permits, ABC licenses, utilities, fire protection, county service districts, water and sewer districts, environmental compliance, taxes (income, gas, property and others) and title.  Information regarding the surveys is available on-line at the office of the North Carolina Geodetic Survey.  [ ]  The legal premise is that “[t]he boundary between North Carolina and South Carolina has not changed; however, over the course of time from the original survey of the boundary, some of the markers denoting the boundary from the original surveys have been lost or destroyed by the elements.”  [Session Law 2016-23, (herein the “Session Law”) on-line at:]  

The areas affected are below:


Closing issues

Issues of concern with closings, primarily those for properties previously believed to lie only in one state and now lying partially or entirely across the border:

  • TRID disclosures and settlement statement will be significantly affected by dual title examination, dual documentation, dual recording and dual title insurance premium costs.
  • Addresses may change.
  • For SC property, a SC attorney must handle the closing and disbursement.  But for NC, a NC approved attorney must certify the title and the closing must comply with APAO 2002-1.
  • Potential delays may result from dual researching, addressing ambiguities, closing and recording.
  • Title insurance will require both NC and SC licensed underwriter(s) and/or agent(s).
  • New surveys, locating the property boundaries with reference to the newly resurveyed state line boundary markers, are highly recommended to assure the location of the boundary vis-à-vis the property is correctly identified and, therefore, to determine which states’ laws apply.


Title Examination and Title Insurance

Information alerting all to the change will include:

  • A Notice of Affected Parcel, based on taxpayer listings, will be recorded in the office of the Register of Deeds of each county, along with the re-survey maps. 
  • Tax office records should begin showing the changes.
  • The owners will be receiving correspondence and different tax bills, and resident owners will have changed voter registration, driver’s licenses, and other notice of the change


For North Carolina affected property, the Session Law provides the legislative intent that as of January 1, 2017:

“All conveyances and instruments of title, of any sort, made prior to the certification of the boundary shall be recognized and given full faith and credit in this State according to the law, jurisdiction, and terms in effect at the time of the conveyance in the jurisdiction the property was previously treated as being subject to.


A NEW SURVEY IS HIGHLY RECOMMENDED IN ORDER TO VERIFY LOCATION OF THE BOUNDARY with respect to the property involved in the transaction.  Otherwise, it may be difficult to determine reliably which states’ laws apply.  Many properties will now be found to be located in both states, -- and in some cases the actual improvements which affects address, voting, licensing, schools and other matters.


Taxes will be listed in the “prior” state for years prior to January 1, 2017, but any NC affected property will be added to the tax records for the county (and city, if applicable) in North Carolina beginning January 1, 2017.  The title will need to be examined in both states, even if the re-survey locates the NC affected property, formerly in South Carolina, as now entirely in North Carolina.  NOTE:  IT IS NOT RECOMMENDED THAT ANY PRE-JANUARY 1, 2017 DOCUMENTS ON NC AFFECTED PROPERTY BE RE-RECORDED IN NORTH CAROLINA AFTER JANUARY 1, 2017.  Given the nature of title, it is conceivable that further documents will be recorded in the “former” state even after January 1, 2017, and those potential interests will need to be included in properly advising a purchaser or lender.  To the extent that filings are in both states on the NC affected property, it will be critical to address ambiguities.


It is highly recommended that any post-1/1/2017 deed or conveyance include a notation with reference to the Session Law so that any title examiner would be put on additional notice of the changes.


A sample requirement under discussion by the North Carolina Land Title Association povides:


For any portions of the Land lying in North Carolina on or near the South Carolina boundary identified pursuant to the confirmed boundary under S.L. 2016-23), previously believed to be in South Carolina (the “affected portion of the Land”) and title to which was previously recorded in South Carolina, and for which a Notice of Boundary Recertification should appear in the North Carolina County Registry wherein the Land is in fact located, opining attorney must provide:


(1) a title opinion from a South Carolina licensed attorney who is an Approved Attorney with this carrier as to the status of title to the affected portion of the Land according to the South Carolina public records through the date of the opinion, based on generally accepted standards of practice for South Carolina title examination, certification (and generally accepted standards for tacking to a prior policy); any matters of record after the January 1, 2017 effective date should be noted.


(2) a North Carolina licensed attorney’s opinion as the status of title to the Land according to the North Carolina public records based on generally accepted standards of practice for North Carolina title examination, certification (and generally accepted standards for tacking to a prior policy); any matters of record regarding the affected portion of the Land before the January 1, 2017 effective date should be noted.


Upon receipt of said opinions, this requirement will be removed or amended and exceptions may be added in accordance with the facts disclosed thereby.[NOTE:  It shall not be necessary nor is it recommended that South Carolina documents be re-recorded in North Carolina, since the South Carolina public record constitutes the “official” title prior to the boundary confirmation date.]


Some of the most critical legal differences between the states include:



North Carolina

South Carolina

Title to “A and spouse, B”

Tenancy-by-entireties, automatically

Tenants in common – could be with rights of survivorship (if stated)

Marital rights

Inchoate marital rights of non-owning spouse


Security Interests

Deeds of Trust



Per capita & marital elections/spousal share

Per stirpes & spousal share, per distribution deed

Estate Administration

Local clerk’s file

Distribution deeds

Deed execution


2 witnesses (one can be notary) and acknowledgment or probate

Mechanics’ Liens

Relation-back & lien agent

Mortgage priority


Statute of frauds and priority recording requirement à more than 3 years

Statute of frauds and priority recording requirement à more than 1 year


Power of sale

Judicial sale / civil action

In rem jurisdiction – special proceedings & judicial action

North Carolina only!

Uniform Enforcement of Foreign Judgments Act

South Carolina only!

Search Period

30+ Marketable Title Act

40-60 years (tradition & quiet title act)

Practice of Law

Attorneys must certify title, draft deeds and deeds of trust and give closing advice; Authorized Practice Advisory Opinion 2002-1 and G.S. 84-2.1

Attorneys must perform or supervise the following aspects of a closing: searching titles, drafting documents, attending closings, disbursement, recording documents.




Lastly, foreclosure counsel will need to address the significant differences in the states’ security interest and foreclosure law.  Under the Session Law, a power of sale can only be held if the Mortgage so provides.  Lenders can, however, substitute a trustee (since the SC Mortgage presumably would not have one) and bid and purchase at their own foreclosure sale under the Session Law (as compared to prior common law).


With regard to properties now found to be located in South Carolina, but formerly believed to be in North Carolina (the “SC affected property”), South Carolina counsel familiar with the re-certification effects should be consulted.  South Carolina’s legislature adopted S. 667 (on-line at:, which includes substantial additional provisions, including title provisions, which differ somewhat from the North Carolina Session Law.  NOTE:  That property tax exemptions or deferrals rollback payments will not be triggered by the boundary certification; it will not be considered a “disqualifying event” with regard to deferrals or exemptions from property taxes.







Legislative Update By David Ferrell

On Friday, July 1, 2016, at approximately 11:15 p.m., the “short” session of the North Carolina General Assembly ended for the year. The session, which began on April 25, ended when it was projected to end and lived up to its name. At 68 days, it was shorter than the typical short session (lawmakers have averaged 77 days in election-year sessions since 2000). The primary focus of the session was passing the state’s budget, and the legislature passed the $22.3 billion state budget bill by the end of the state’s fiscal year (June 30).  The budget bill was signed by Governor McCrory on July 14, 2016.


The legislature passed a number of significant pieces of legislation this session, including a bill to govern the use of body worn cameras by law enforcement officers, a bill to expand “crowd funding” investments, a bill to provide an approximate 4.7% raise for public school teachers, and a bill to make a change to the law known as House Bill 2 to restore the right of employees to sue for employment discrimination using state law.


After adjourning the legislative session on July 1, the House honored retiring House Principal Clerk Denise Weeks with a representative statement signed by all 120 House members and a fake resolution requiring her to remain in her post indefinitely. Weeks began working at the General Assembly in 1977. She was first elected by the House as principal clerk in 1993 and has remained there ever since. She delayed her retirement earlier this year to work though the short session.


The legislature enacted several changes to the State’s income tax laws.  The State Budget Bill increases the standard deduction from $15,500 to $16,500 for married couples filing jointly this year, with an additional increase to $17,500 next year. For a single person, the deduction increases from $7,750 to $8,750 over two years.


The 2017 “long session” is scheduled to begin on Wednesday, January 11, 2017. The legislature did not adopt a studies bill this session. The President Pro Tem of the Senate and Speaker of the House have the inherent authority, including through the Legislative Research Commission and Courts Commission, to study issues, so there may be formal studies before the 2017 legislative session convenes.


This article contains a summary of the legislation of interest from the 2016 Legislative Session.  The first section contains bills enacted into law, and the second section includes bills that were not enacted into law. For more information about legislation described in this legislative report, feel free to contact me at or (919) 754-1171.  Information is also available on the General Assembly’s website:







Senate Bill 19, Uniform Recording Fees – Register of Deeds. At the request of NCLTA, the original contents of Senate Bill 19 were removed and replaced with a bill to adjust the uniform recording fees for deeds of trust at the Register of Deeds office in order to comply with closing disclosure requirements established by the federal TRID law. The bill provides that the recording fee for the first 35 pages would be $64 (currently, first 15 pages is $56), and each additional page would continue to be $4. A Register of Deeds study showed that most residential and commercial deeds of trust are 30 pages or less. So this 35 page limit should include most if not all deeds of trust. This should help real estate attorneys in estimating the recording fees in residential real estate transactions under the new TRID rules. This bill is supported by NCLTA as well as the RP Section of the Bar Association, RELANC, and the NC Bankers Association. Effective: October 1, 2016. Session Law 2016-86.



Senate Bill 124, Assumed Bus. Name/IC Contempt/Parks, modernizes the law governing the use of assumed business names, as recommended by the General Statutes Commission.  The bill states that the purpose of the Act is to afford the public a means of ascertaining the real name of persons engaging in business in this State under an assumed business name by requiring those persons to register the assumed business name. The bill provides that before any person engages in business in North Carolina under an assumed business name, the person must file an assumed business name certificate in the office of the register of deeds of the county in which the person is or will be engaged in business. If the person is or will be engaged in business in multiple counties, filing is required in only one of those counties. 


An assumed business name certificate must include: (1) the assumed business name; (2)  a real name of the person engaging in business under the assumed business name (if the business is a partnership other than a limited liability partnership or limited partnership, the assumed business name certificate must include a real name of five general partners or of each general partner, whichever is fewer); (3)  the nature of the business; (4)  the street address of the principal place of business; and (5) each county where the person uses or will be using the assumed business name to engage in business.


The bill requires the Secretary of State to develop, implement, and maintain a searchable online database of assumed business name information. The system must allow information to be entered and retrieved from the system by the registers of deeds and must be available for searches by the public.


The register of deeds of each county must index every assumed business name with respect to which an assumed business name certificate, a certificate of amendment, or a certificate of withdrawal has been filed in that county. Not later than 30 days after the date a certificate is filed, the register of deeds must transmit a scanned image of the certificate to the Secretary of State and enter into the central database maintained by the Secretary of State the assumed business name, the real name of each person engaging in business under that name, the type of certificate, the county in which the certificate was filed, and, in the case of a certificate of amendment or certificate of withdrawal, the identification number assigned to the assumed business name by the Secretary of State (SOS ID). Effective only if funds are allocated by the Office of State Budget and Management from the legislative reserve fund. Session Law 2016-100.



Senate Bill 575, NC/SC Original Border Confirmation. This bill addresses many of the legal and practical issues that result from the re-establishment of the boundary between North Carolina and South Carolina, including real estate, mortgage, tax, professional or business licensing, voter registration, in-state tuition, and other similar issues.


The bill requires the North Carolina Geodetic Survey to record the final survey of the confirmed NC/SC boundary in the office of the register of deeds in every county in this State where real property has been affected by the certification of the boundary. The applicable uniform fees provided in G.S. 161‑10 apply to the recordation of the final survey. The register of deeds shall register and index the surveys.


For parcels of real property affected by the certification of the boundary, situated in whole or in part within the boundaries of North Carolina, the North Carolina Geodetic Survey shall record a Notice of Affected Parcel in the office of the register of deeds in the county or counties where each affected parcel is situated. The register of deeds shall register and index the Notice. Notwithstanding any other provision of law to the contrary, the register of deeds shall not collect any fees or taxes for these Notices. The Notice shall contain at least all of the following information:


(1)        Reference to this act.

(2)        The recording reference for the final survey of the confirmed boundary recorded pursuant to this section.

(3)        The names of the record owners of the parcel.

(4)        The property address of the parcel.

(5)        A tax parcel identification number or other applicable identifier used by a county tax office, if available.

(6)        A brief description of the parcel, if available.

(7)        A source deed reference for the parcel, if available.


The bill provides that title to real property previously treated as being subject to the jurisdiction of the State of South Carolina but that is recognized as being within the boundaries of North Carolina as a result of the certification of the boundary is not affected by the certification of the boundary or the recognition of the real property as being within the boundaries of North Carolina. All conveyances and instruments of title, of any sort, made prior to the certification of the boundary shall be recognized and given full faith and credit in North Carolina according to the law, jurisdiction, and terms in effect at the time of the conveyance in the jurisdiction the property was previously treated as being subject to. For the purposes of this subsection, "instruments of title" means any instrument that affects title or constitutes the chain of title to real property, including, but not limited to, all deeds, wills, estate documents evidencing transfer of title, plats, surveys, easements, rights‑of‑way, outstanding mortgages and deeds of trust, judicial orders or decrees, and documents evidencing intestate succession.


The bill provides that liens recorded prior to the date of boundary certification with the register of deeds or docketed with the clerk of superior court in the county in this State where the affected parcel is situated shall attach, as a class, to the affected parcel as of the effective date and time of the boundary certification. This class of liens shall be assigned priority as of the date of boundary certification but shall retain the same priority among themselves as if this subsection did not apply.


The bill provides that the Commissioner of Insurance shall not take any of the following actions with respect to a real estate title insurance company that previously operated only in South Carolina and issued a policy of title insurance in compliance under South Carolina law for a parcel of real estate now determined to be located wholly or partially in North Carolina:

(1)        Require a certificate of authority to do business as a real estate title insurance company under Article 26 of Chapter 58 of the General Statutes.

(2)        Take enforcement action against any title insurance company for failure to comply with the requirements of Article 26, 27, or 28 of Chapter 58 of the General Statutes applicable to real estate title insurance companies in North Carolina or any other statutory or regulatory requirements applicable to all insurance companies in North Carolina.


The bill provides that nothing in this section is intended to prevent the Commissioner of Insurance from entering into a memorandum of agreement with the South Carolina Department of Insurance with respect to enforcement of South Carolina law against real estate title insurance companies subject to this section.


Regarding foreclosure, the bill provides that foreclosure actions initiated on real property encumbered by a security instrument recorded in South Carolina wherein the real property is situated, in whole or in part, within the certified North Carolina boundaries shall be governed by the terms of the security instrument sought to be enforced for that portion of real property recognized as being in a different state. If the security instrument contains a power of sale clause, the party seeking to enforce the terms of the security instrument may initiate a foreclosure action in the county where the real property is situated pursuant to Chapter 45 of the General Statutes. A party seeking to enforce the terms of the security instrument may also resort to judicial foreclosure, pursuant to Article 29A of Chapter 1 of the General Statutes, in accordance with the terms within the security instrument.


The bill provides that judgments or orders of foreclosure entered by courts of North Carolina are binding and effective only with respect to the portion of real property situated within North Carolina. Prior to initiating an action to enforce a security instrument, the security instrument or a certified copy shall be recorded in the office of the register of deeds for the county where the subject property is situated. The provisions of G.S. 45‑10(a) shall apply with regard to the appointment or substitution of a trustee for any mortgage or deed of trust foreclosed pursuant to this section. The bill provides that notwithstanding any other provision of law to the contrary, for mortgages foreclosed under this section, a mortgagee or its successors or assigns shall be entitled to bid at a foreclosure sale conducted pursuant to a judgment or order of foreclosure entered by the courts of this State.


The version of the bill that passed does not contain the “certificate of title” provisions and process that was recommended by many of the real estate and title attorneys that worked on the real estate and mortgage aspects of the bill, either through the NC/SC Boundary Commission or independently.


Towards the end of the legislative session, it seemed there may be an opportunity to make minor changes to the bill to address some of the title and mortgage concerns. However, such an effort was met with strong opposition from the bill sponsors - they represented that since South Carolina had signed off on this version and had already passed their version of the NC/SC Boundary bill, there could be no changes. The House committee chair we were working with ultimately agreed not to make changes this year, but we received the commitment of the bill sponsors that they would support a bill in the 2017 legislative session to make technical changes to the title and foreclosure provisions of the bill as may be necessary.  Effective: June 22, 2016. Session Law 2016-23.



Senate Bill 600, Appraiser Compensation/Judge Perform Marriage, gives the NC Appraisal Board the ability to discipline an Appraisal Management Company (AMC) if they do not pay customary and reasonable fees to residential appraisers in the “primary residence” residential dwelling context in compliance with section 129E(i) of the federal Truth in Lending Act (15 U.S.C. § 1601 et seq.) and regulations promulgated thereunder. Effective: June 30, 2016. Session Law 2016-61.



Senate Bill 770, NC Farm Act of 2016, modifies when the lien for deferred taxes on land eligible for present use value classification is extinguished, in order to promote sales for land conservation uses. The bill provides that if property loses its eligibility for present‑use value classification because the property is conveyed to a nonprofit organization and qualifies for exclusion from the tax base pursuant to G.S. 105‑275(12) or G.S. 105‑275(29), deferred taxes would be due as follows:

(1)        If the property is conveyed at or below present‑use value, no deferred taxes are due, and the lien for the deferred taxes is extinguished.

(2)        If the property is conveyed for more than present‑use value, a portion of the deferred taxes for the preceding three fiscal years is due and payable in accordance with G.S. 105‑277.1F. The portion due is equal to the lesser of the amount of the deferred taxes or the deferred taxes multiplied by a fraction, the numerator of which is the sale price of the property minus the present‑use value of the property and the denominator of which is the true value of the property minus the present‑use value of the property.


Effective: July 26, 2016. Session Law 2016-113.



Senate Bill 805, Fiduciary Access to Digital Assets, enacts the revised Uniform Fiduciary Access to Digital Assets Act and make conforming amendments to various statutes, as recommend by the General Statues Commission. The bill establishes a framework to address digital assets after one’s death, including placing duties on any fiduciary charged with managing tangible property including digital assets.  Effective: June 30, 2016. Session Law 2016-53.



Senate Bill 807, Conform Full-Payment Check Law to UCC, conforms to the comparable provision of the Uniform Commercial Code North Carolina’s law on accord and satisfaction of a disputed debt through the tendering of a negotiable instrument as full payment of the debt, as recommended by the General Statutes Commission. Effective: October 1, 2016. Session Law 2016-52.



House Bill 283, Prevent Squatting in Foreclosed Real Property, enhances the criminal penalties for persons who commit a trespass to real property by re-entering after removal pursuant to a valid order or by knowingly creating or presenting a false document of title or possession. Effective: December 1, 2016. Session Law 2016-26.



House Bill 289, NC Money Transmitters Act.-AB, enacts the North Carolina Money Transmitters Act as requested by the Office of the North Carolina Commission of Banks to regulate those in the business of transferring currency for third parties, including bitcoin. Some concerns were raised last year that this bill may have the unintended consequence of applying to real estate transactions or wire transfers received by title insurance companies. The attorney for the Commissioner of Banks has assured us that the Money Transmitters Act does not apply to real estate closings and related escrow services, and the Commissioner has agreed to provide an official opinion letter so stating if interested groups feel it is necessary. Effective: October 1, 2016. Session Law 2016-81.



House Bill 436, Unauthorized Practice of Law Changes. This bill was introduced in the 2015 legislative session to address the disputes between the North Carolina State Bar and Legal Zoom over Legal Zoom’s on-line services and whether such services are the unauthorized practice of law. Legislators ended this long-running dispute by passing this bill which allows online services to provide legal documents in North Carolina. The House and Senate passed House Bill 436 after a conference committee spent months negotiating the language. RELANC had input into the conference committee process and several provisions of the bill were amended or added at their request.


The bill redefines the term "practice of law" by exempting services that provide blank legal documents, such as wills, lease agreements and promissory notes, that people can fill out online, purchase and print. The services must register with the State Bar every year, and each type of document must be reviewed and approved by a licensed North Carolina attorney before going online. The services also must include a disclaimer that the online documents are not a substitute for seeking legal advice, and any customer satisfaction disputes must be referred to the State Bar. In explaining the bill on the Senate floor, Senator Warren Daniel (R-Burke), an attorney in Morganton, said "The Internet has changed the way consumers get services, and this is a first step in adjusting to the online presence of legal services.” Senator Daniel also stated: "I would say that it would be penny-wise and pound-foolish to rely on a Web-based legal service to prepare any significant life documents .... That's my free legal advice for the week."  Effective: June 30, 2016. Session Law 2016-60.



House Bill 483, Land Use Regulatory Changes. This bill provides that amendments in zoning ordinances, subdivision ordinances, and unified development ordinances shall not be applicable or enforceable without the written consent of the owner with regard to a multi‑phased development. The bill defines “multi‑phased development" as a development containing 100 acres or more that (i) is submitted for site plan approval for construction to occur in more than one phase and (ii) is subject to a master development plan with committed elements, including a requirement to offer land for public use as a condition of its master development plan approval. A multi‑phased development shall be vested for the entire development with the zoning ordinances, subdivision ordinances, and unified development ordinances then in place at the time a site plan approval is granted for the initial phase of the multi‑phased development. The bill provides that a right which has been vested as provided for in this subsection shall remain vested for a period of seven years from the time a site plan approval is granted for the initial phase of the multi‑phased development. Effective: July 22, 2016. Session Law 2016-111.



House Bill 870, Cert. of Title/Manuf. Home Changes. This bill was introduced in the 2015 legislative session by Representative Jonathan Jordan (R-Watauga) and Senator Tamara Barringer (R-Wake) at the request of NCLTA to clarify the renewal, release, and cancellation process for security interests on a certificate of title for a manufactured home. We continued to work with our bill sponsors and other legislators in the off season and early in the 2016 legislative session. Ultimately the bill was considered and enacted into law towards the end of the 2016 legislative session.


The bill requires an application of a security interest on a certificate of title for a manufactured home to state the maturity date of the secured obligation. The bill provides that, with a few specified exceptions, a security interest in a manufactured home would automatically expire 30 years after the date of issuance of the original certificate of title containing the notation of the security interest. The bill outlines the processes and procedures for renewal of the perfection of the secured party’s security interest prior to automatic expiration. The bill provides that once issued, the renewal is effective to renew the perfection of the security interest as of the date of the application is delivered to DMV.


The bill amends G.S.§ 20-109.2(d), Application for Title After Cancellation, to make certain clarifications to the statute that addresses when an owner seeks to separate the manufactured home from the real property and applies for a new certificate of title. The provision is effective August 1, 2016.


The bill enacts G.S. § 44A-11.1(a1) concerning mechanic’s lien agents, to provide that when improvements to a real property leasehold are limited to the purchase, transportation or setup of a manufactured home, with a current certificate of title, the purchase price of the manufactured home must be excluded in determining if the costs of the undertaking are $30,000 or more.  


House Bill 870 passed the House in 2015 but did not pass the Senate last year due to a concern raised by the Division of Motor Vehicles (DMV) regarding a request for a state appropriation to pay for the upgrades to their title and lien forms and to their computer system. I worked with the bill sponsors and House and Senate Transportation Appropriations Chairs this year to address the DMV funding request. Specifically I identified some “blanks” on the DMV forms that could be re-purposed to include the maturity date of the security interest required by the bill – which may result in minimal cost to DMV. The bill sponsors, Senate Judiciary II Committee chairs, and transportation appropriation subcommittee chairs became comfortable that the bill could move forward without a state appropriation. Ultimately, the bill was considered and approved by the legislature this session. Effective: July 1, 2017. Session Law 2016-59.



House Bill 959, DOT Proposed Legislative Changes, allows broadband and fiber providers to locate their lines and facilities in North Carolina Department of Transportation (NCDOT) right-of-ways without permission or payment to the underlying landowner.


The bill rescinds all transportation corridor official maps and any amendments thereto, as well as any restrictions on the use of property affected by the rescinded maps.  The NCDOT will post information regarding the rescinded maps in clerks’ offices and registers of deeds’ offices in counties where maps of affected properties are/were located. The bill requires NCDOT to study a new process for planning and protecting transportation corridors.


The bill reduces the applicable interest rate available to landowners in NCDOT condemnation cases from 8% to the prime lending rate, which is approximately 3.5% today.


The bill provides an option for motorists to check a box on their motor vehicle title application to have joint tenancy with right of survivorship apply to a motor vehicle. Effective: July 11, 2016. Session Law 2016-90.



House Bill 1018, Confirm Commissioner of Banks, confirms the Governor’s reappointment of Raymond E. Grace as the Commissioner of Banks. Ratified: June 2, 2016. Resolution 2016-9.



House Bill 1030, 2016 State Appropriations Act, sets the percentage rate to be used in calculating the insurance regulatory charge under G.S. 58-6-25 at 6.5% for the 2017 calendar year. Effective July 1, 2016. Session Law 2016-94.





Senate Bill 89, Filing By Clerk/Magistrate and Clerk Pilot. The original contents of Senate Bill 89 were removed and replaced with a bill to address the effect of orders entered by Clerks of Superior Court that may not contain a file stamp. There are some Clerk’s Offices that apparently do not always file stamp orders that are signed by the Clerk. So although the Clerk may sign, record and enter an order in their docketing system, it may not contain a file stamp. A Court of Appeals case, In re Thompson, ruled that such an order was not effective and set aside subsequent orders and proceeding that relied on the order that lacked a file stamp. This has caused great concern among Clerks and others, such as title insurance companies that rely on orders as a part of the chain of title.


I worked with the Administrative Office of the Courts (AOC) to draft language to address this issue. The agreed upon language was added to Senate Bill 89 when the bill was considered in a House Committee. The language clarifies that the clerk’s order is valid and can be relied upon regardless of whether it contains a file stamp. The provisions of the bill would apply to future orders and orders entered previously – so it would have retroactive application.


A controversial gun permit provision was added to this bill in the House, and as a result, we were told the bill would not be considered further.  Therefore, at our request, the language of Senate Bill 89 was added to another bill, Senate Bill 349, that was moving through the legislative process. However, the legislature adjourned without passing Senate Bill 349. So this provision did not become law.



Senate Bill 821, GSC Technical Corrections 1, would make technical and clarifying changes to various statutes, including to the clerk of superior court’s jurisdiction and venue in estate proceedings. The bill would amend N.C. Gen. Stat. § 31B-1(a) concerning property rights, providing that permissible appointees or takers in default under a power of appointment exercised by a testamentary instrument or a nontestimentary instrument can also renounce at any time, in whole or in part, the right of succession  to any property or interest.


The bill would amend N.C. Gen. Stat. § 39-13.7, concerning tenancy by the entireties trusts in real property, by adding new subsections to provide that real property held in trust will receive immunity from the claims of separate creditors under certain circumstances. The changes would also allow a person entering a transaction involving real property held in trust under the statute to request confirmation from the trustee whether the requirements of the statute providing immunity from the claims of separate creditors are met at the time of the transaction.


At the request of NCLTA, a provision was added to the bill to amend NCGS 39-13 to clarify the statute as to whether a spouse has to sign a mortgage or deed of trust in the sale of real property for it to be enforceable against the spouse – it would conform the practice for institutional loans (banks) and purchase money (owner) financing. Under the amendment, the spouse does not have to sign the mortgage or deed of trust for the mortgage or deed of trust to apply to that spouse as it relates to the property. The issue was that some clerks and others have interpreted the statute to treat the two scenarios differently; this change would merely conform the practice and treat them the same.


Although most of the provisions of this bill were non-controversial, the legislature adjourned without passing this bill. These provisions did not become law.



House Bill 3, Eminent Domain, would amend the North Carolina constitution to prohibit condemnation of private property except for a public use (could not condemn for “public benefit”), to provide for the determination of just compensation by specifying the right of trial by jury in all condemnation cases, and to make similar statutory changes.  House Bill 3 was not enacted this session.



House Bill 169, Regulatory Reduction Act of 2016. Although the original contents of this bill were replaced with a bill that was enacted to address some of the provisions of House Bill 2, the original version of House Bill 169 included a provision to “streamline mortgage notice requirements” by providing that the statement mailing requirement and borrower notification requirements of G.S. 45-91 are deemed satisfied by compliance with the disclosure requirements contained in Regulation Z, 12 C.F.R. § 1026.41.  This provision did not become law.



House Bill 375, Real Property/Error Correction & Title Curative. would amend the procedures for correcting typographical, obvious description, or other minor errors in recorded instruments. This bill was introduced at the request of Investors Title Insurance Company. The bill would define obvious descriptive error, would provide for a “corrective affidavit” process in certain situations, to take the place of a reformation action. The bill would require notice to interested parties as a part of the “corrective affidavit” process. The bill would provide a form for the corrective affidavit. The bill would create a ten-year curative provision for certain defects in recorded instruments.  The bill was not considered this session and was not enacted into law.



House Bill 548, Confirming Changes/Constitutional Amend, would have enacted various statutory changes to support the constitutional amendment proposed in House Bill 3 discussed above. The bill would amend GS 40A-3(a) which applies to private condemnors to provide that they can condemn only for “public use”, not “public use and benefit”. The bill also changes the reference to communication companies and natural gas companies, but these changes are technical or clarifying. The bill also adds a new subsection (d) to GS 40A-3 that specifically states the private condemnors and public condemnors possess the power of eminent domain and may acquire by purchase, gift, or condemnation any property for the connection of any customer or customers to utilize. This bill was not enacted into law.



House Bill 1061, Preserve Tenancy by the Entirety, would make conforming amendments to clarify that tenancy by the entirety is preserved in North Carolina in light of the United States Supreme Court decision in Obergefell v. Hodges, as recommended by the General Statutes Commission. The bill would change references to “husband and wife” to “spouses” or “two individuals married to each other” in various places in the statutes. This bill was not enacted into law.



4813-3835-2951, v. 1



Prepared By: David P. Ferrell, Esq. - NCLTA Lobbyist



From the Editor

It is such an honor to serve as the editor of the NCLTA newsletter. I hope that the newsletter will continue to be a valuable resource for each of our members and to those with an interest in the title industry. If there are topics that you are interested in hearing about or articles that you wish to contribute, please let me know. Our goal is to keep or members educated and informed.  I am always available to you as a resource for any questions that you may have about the newsletter or NCLTA. Thank you for your membership!



Benjamin V. Ipock
Attorneys Title
8000 Regency Parkway, Suite 165
Cary, North Carolina 27518
Phone:  (919) 861-1425



Editorial Committee Chair 
Ben Ipock

Executive Staff 
Tracy Steadman, Executive Director


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