CA Assembly Bill 578

Legislation

State: California
Signed: September 21, 2004

Effective: September 21, 2004
Chapter: 621

Summary

Affects

Adds Article 6 to Chapter 6 of Division 2 of Title 3 of the California Government Code

Changes

Authorizes any county recorder to implement an electronic recording delivery system approved and regulated by the Attorney General. Prior law gave Orange and San Bernardino counties – and no others – authorization to do so.
Allows only an “authorized submitter” (a title insurer, underwritten title company, institutional lender or local, state or federal governmental entity) to submit digitized and digital instruments for recording.
Allows electronic recording of digitized (scanned paper documents) instruments affecting a right, title, or interest in real property submitted by an authorized submitter.
Allows electronic recording of digitized or digital (entirely electronic documents not generated first on paper) reconveyance instruments, substitutions of trustee and assignments of deeds of trust submitted by an authorized submitter.

Analysis

Assembly Bill 578 was enacted to permit (but not require) any county recorder in the state to electronically record documents after the county’s electronic recording delivery system is approved by the local county board of supervisors and certified by the Attorney General. The bill gives the Attorney General wide regulatory oversight of electronic recording in the state to protect property owners and lenders from fraud and identity theft. The bill specifically allows counties to electronically record scanned images of paper instruments affecting the right, title to or interest in real property. Affected documents include deeds of trust, warranty, grant, and quitclaim deeds. Under this system, paper documents are executed and notarized, scanned by the submitting party and sent via the Internet to the county recorder for entry into the electronic recording system. The Notary would perform “pen and ink” notarizations on the documents; no electronic notarizations would be involved. Only specified “authorized submitters” may submit these electronic documents for recording; the general public may not do so. In addition, the law also permits counties to accept fully electronic reconveyance instruments, substitutions of trustee and assignments of deeds of trust. Unlike digitized documents, these “digital” documents are created, signed, notarized, transmitted and recorded electronically. As defined under AB 578, digital documents would include documents created as Adobe Acrobat (PDF) files or as “SMART” documents – all-digital documents with integrated data and visual presentation information. Notaries are allowed to notarize these documents electronically without affixing a physical seal as long as the required words typically contained within the physical Notary seal are incorporated into the Notary’s electronic signature. It should be noted that while AB 578 opens the door to electronic notarization in California, the number of Notaries who will actually perform electronic notarizations will be limited to those Notaries who routinely notarize reconveyance instruments, substitution of trustee documents and assignments of deeds of trust.

Read Assembly Bill 578.