MARA MEMBERS:

A member has asked for your input on LD 1311. If you have any, please reply to this post. 

LD 1311 will be acted on in the Judiciary Committee next Wednesday, May 3, so if you have thoughts, please post them before then!       Thanks -- MARA webmaster

The member writes: "The legislature would appreciate input from road association folks regarding LD 1311 (text copied below). This bill was brought about by property title search companies. They have found it can be difficult to determine during the sale of a property if there is a debt to statutory road associations since there is not necessarily a public record for that debt they can search for. The changes you see this bill proposing were to make it easier for debts to be found during title searches. While this bill requires slightly more work for road associations, it can benefit them by insuring they get paid at the time of the sale if the debts are recorded in the registry of deeds as described.

There's one major flaw we are seeking suggestions for. By requiring a notice of claim to be filed for the debt to run with the land, this creates an issue with the 120 day window between when the money is owed and when road associations can file a notice of claim. If a property sells in this 120 day window, the road association would be unable to collect that year's monies and it would not run with the land since a notice of claim could not be filed. Are there any suggestions that you have to rework the language and still allow for the requirement of the notice of claim but would resolve the issue that arises with the 120 day window?

One suggestion would be to do away with the requirement of filing a notice of claim, instead requiring statutory road associations to file a record in the registry of deeds when they form so the title search companies can be made aware of the existence of road associations and make the necessary inquires from there. However, it's believed that the road association folks would not be in favor of this option.

Ultimately the goal here is how can it be made a "win-win" for both parties. We are looking for ideas that would provide public information on statutory road associations to title searchers, without severely impacting road associations in a negative way."      

LD 1311 An Act To Amend the Law Regarding Lien Recordings on Statutory Road Associations Be it enacted by the People of the State of Maine as follows:
Sec. 1. 23 MRSA §3104,  as amended by PL 2013, c. 198, §10, is further amended to read:
§ 3104. Penalties and process 
Money recovered under sections 3102 and 3103 is for the use of the owners. In any notice of claim or process for the money's recovery, a description of the owners in general terms as owners of parcels of land benefited by the private road, private way or bridge by name, clearly describing each owner's parcel of land by the book and page number of the owner's deed as recorded in the county's registry of deeds and the private road, private way or bridge, is sufficient. If the private road, private way or bridge is shown on a plan recorded in the county's registry of deeds, the plan's recording reference is sufficient. Such process is not abated by the death of any owner or by the transfer of any owner's interest. Any money owed pursuant to section 3101, 3102 or 3103 is an obligation that is personal to the owners of the subject parcels, jointly or severally, and , if a notice of claim is recorded in the county's registry of deeds, also burdens the parcel and runs with the land upon the transfer of any owner's interest. The commissioner or board may cause to be recorded in the county's registry of deeds a notice of claim for money owed pursuant to section 3101, 3102 or 3103 that is more than 90 days delinquent and may add to the amount owed the recording costs. The recording of such notice does not constitute slander of title. Before recording such notice or service of process of a complaint for collection in a civil action, the commissioner or board shall give the owner against whom such action is to be taken written notice, in the same manner as written notices of meetings are provided for in section 3101, of the intended action if the debt is not paid within 20 daysof the date of the written notice. This written notice to cure must be sent at least 30 days before the recording of the notice of claim or the service of process of the complaint for collection in a civil action. If the money owed pursuant to section 3101, 3102 or 3103 is paid, the commissioner or board shall cause to be prepared and recorded in the county's registry of deeds a release of any recorded notice of claim.

 

SUMMARY

This bill makes the following changes to the laws governing the repair and maintenance of private ways.
1. It requires any notice of claim or 
process for the recovery of money from the owner of a parcel of land 
benefited by a private way to include the name of the owner of the 
parcel.
2. It provides that in order for an 
obligation of an owner of a parcel of land benefited by a private way to burden the parcel and run with the land upon the transfer of the 
owner's interest, a notice of claim must be recorded in the county's 
registry of deeds.
3. It requires the road commissioner or 
road association board to prepare and record in the county's registry of deeds a release of a recorded notice of claim when money owed by an 
owner of a parcel of land benefited by a private way is paid.

The proposed LD 1311 amendment provides additional language to clarify certain notification procedures contained in the current statute “Section 3104 Penalties and process”.

Our road association has experienced only one situation that required filing a claim (lien) notice. We followed all the procedures described in the proposed amendment, even though they were not explicitly stated in the current statute. We successfully recovered the delinquent assessments during the process of property transfer. At the time I was privately concerned that our claim might be overlooked or ignored at closing so I support this effort to make road association claims more visible and transparent to those who need it.

I do have a few comments:

• The 90-day clock should start on the date that payment of assessments is due and this date should be clearly stated in the original billing. We also send overdue notices to all property owners who have not paid after 30 days.
  
• A “warning” was sent to the property owner after 90 days of non-payment indicating that a claim (lien) would be filed at the county registry of deeds if not paid in 30 days. A copy of the recorded lien was also mailed to the property owner.
  
• In our situation, the property owner owed for several years and the appearance of a for-sale sign prompted us to action. A copy of the lien was also mailed to the listing real estate agent. Once the debt was paid a notice of release was filed with the registry of deeds.
  
• Based on this experience, I believe it would be prudent for a road association to always be aware of what’s going on in their area and to understand the legal limits of their jurisdiction. It may also be helpful to archive a copy of each of property deed within the jurisdiction of the association, and checked for changes annually. This keeps hearsay to a minimum. Copies of deeds can be obtained at the registry of deeds in each county (in our county the first 800 pages are free – check your county for details).
  

It is unclear what the collection process should be once a property transfer has been completed but before a lien against the delinquent seller is filed with the registry of deeds. In this event is a warning of impending claim sent to the buyer? Is the debt collectable?  

Let me know if you have any questions.