Bill Text: OR SB804 | 2013 | Regular Session | Engrossed
Bill Title: Relating to trust deeds; declaring an emergency.
Spectrum: Committee Bill
Status: (Failed) 2013-07-08 - In committee upon adjournment. [SB804 Detail]
Download: Oregon-2013-SB804-Engrossed.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3679
A-Engrossed
Senate Bill 804
Ordered by the Senate April 22
Including Senate Amendments dated April 22
Sponsored by COMMITTEE ON JUDICIARY
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
{ - Requires grantor that seeks mediation with trustee before
foreclosure proceedings to provide mediation service provider
with certain documents. - }
{ - Makes beneficiary's duty to provide certain documents and
to appear at mediation contingent on grantor's providing
documents. - }
{ - Specifies when grantor is at risk of default and would be
eligible to seek mediation with beneficiary. - }
{ - Specifies form of notice of determination that
beneficiary must send to grantor if beneficiary determines that
grantor is not eligible for foreclosure avoidance measure or if
grantor fails to comply with foreclosure avoidance measure. - }
Revises definition of 'beneficiary. '
Modifies requirements for trustee to foreclose a trust deed by
advertisement and sale.
{ - Modifies requirements for providing notice of sale. - }
{ - Modifies notice requirements for postponing trustee's
sale. - }
Declares recorded trustee's deed prima facie evidence that all
assignments required to be recorded are recorded. Declares
instrument executed by beneficiary prima facie evidence that
beneficiary is authorized to execute instrument.
{ - Becomes operative 91 days after effective date of
Act. - }
{ + Permits beneficiary to designate agent or nominee to act
on behalf of beneficiary. + }
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to trust deeds; creating new provisions; amending ORS
86.705, 86.735, 86.780 and 86.790; and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 86.705, as amended by section 5, chapter 112,
Oregon Laws 2012, is amended to read:
86.705. As used in ORS 86.705 to 86.795:
(1) 'Affordable housing covenant' has the meaning given that
term in ORS 456.270.
(2) 'Beneficiary' means { - a - } { + the + } person named
or otherwise designated in a trust deed as { - the person for
whose benefit a trust deed is given - } { + the
beneficiary + }, or the person's successor in interest { - , and
who is not the trustee unless the beneficiary is qualified to be
a trustee under ORS 86.790 (1)(d) - } .
(3) 'Eligible covenant holder' has the meaning given that term
in ORS 456.270.
(4) 'Grantor' means the person that conveys an interest in real
property by a trust deed as security for the performance of an
obligation.
(5) 'Residential trust deed' means a trust deed on property
upon which are situated four or fewer residential units, one of
which the grantor, the grantor's spouse or the grantor's minor or
dependent child occupies as a principal residence at the time a
{ + trust deed foreclosure is commenced + } { - default that
results in an action to foreclose the obligation secured by the
trust deed first occurs - } .
(6) 'Residential unit' means an improvement designed for
residential use.
(7) 'Trust deed' means a deed executed in conformity with ORS
86.705 to 86.795 that conveys an interest in real property to a
trustee in trust to secure the performance of an obligation the
grantor or other person named in the deed owes to a
beneficiary { + or a person for whom the beneficiary is acting
as agent or nominee + }.
(8) 'Trustee' means a person, other than the beneficiary, to
whom a trust deed conveys an interest in real property, or the
person's successor in interest, or an employee of the
beneficiary, if the employee is qualified to be a trustee under
ORS 86.790.
SECTION 2. ORS 86.735, as amended by section 6, chapter 112,
Oregon Laws 2012, is amended to read:
86.735. { + (1) + } A trustee may foreclose a trust deed by
advertisement and sale in the manner provided in ORS 86.740 to
86.755 if:
{ - (1) - } { + (a) + } The trust deed, { - any
assignments of the trust deed by the trustee or the beneficiary
and - } any appointment of a successor trustee { + and any
assignment that changes the designation of the beneficiary of the
trust deed + } are recorded in the mortgage records in the
counties in which the property described in the deed is situated;
{ - (2) There is a default by the grantor or other person
that owes an obligation, the performance of which is secured by
the trust deed, or by the grantor's or other person's successors
in interest with respect to a provision in the deed that
authorizes sale in the event of default of the provision; - }
{ + (b) The grantor or other person, or the grantor's or
other person's successor in interest, defaults on an obligation
for which the trust deed secures performance and with respect to
which a provision in the deed authorizes sale in the event of
default; + }
{ - (3) - } { + (c) + } The trustee or beneficiary has
filed for { - record - } { + recording + } in the county
clerk's office in each county where the trust property, or some
part of the trust property, is situated, a notice of default
containing the information required by ORS 86.745 and containing
the trustee's or beneficiary's election to sell the property to
satisfy the obligation;
{ - (4) - } { + (d) + } The beneficiary or the
beneficiary's agent has filed for recording in the official
records of the county or counties in which the property that is
subject to the residential trust deed is located the certificate
of compliance the beneficiary received under section 2, chapter
112, Oregon Laws 2012, if the beneficiary must enter into
mediation with the grantor under section 2 (2)(a), chapter 112,
Oregon Laws 2012;
{ - (5)(a) - } { + (e) + } The beneficiary or the
beneficiary's agent has complied with the provisions of section
4a, chapter 112, Oregon Laws 2012 { + , if the provisions apply
to the beneficiary + }; and
{ - (b) The grantor is not in compliance with the terms of a
foreclosure avoidance measure upon which the beneficiary and the
grantor have agreed; and - }
{ - (6) - } { + (f) + } An action has not been commenced to
recover the debt or any part of the debt then remaining secured
by the trust deed, or, if an action has been commenced, the
action has been dismissed, except that:
{ - (a) - } { + (A) + } Subject to ORS 86.010 and the
procedural requirements of ORCP 79 and 80, an action may be
commenced to appoint a receiver or to obtain a temporary
restraining order during foreclosure of a trust deed by
advertisement and sale, except that a receiver may not be
appointed with respect to a single-family residence that the
grantor, the grantor's spouse or the grantor's minor or dependent
child occupies as a principal residence.
{ - (b) - } { + (B) + } An action may be commenced to
foreclose, judicially or nonjudicially, the same trust deed as to
any other property covered by the trust deed, or any other trust
deeds, mortgages, security agreements or other consensual or
nonconsensual security interests or liens that secure repayment
of the debt.
{ + (2) For purposes of subsection (1) of this section, the
negotiation, transfer or assignment of a note does not constitute
an assignment that changes the designation of the beneficiary of
the trust deed. + }
SECTION 3. ORS 86.780 is amended to read:
86.780. { + (1)(a) + } { - When the - } { + If a + }
trustee's deed is recorded in the deed records of the county or
counties where the property described in the deed is situated,
the recitals contained in the deed and in the
{ - affidavits - } { + documents + } required { + to be
recorded + } under { - ORS 86.750 (3) and (4) shall be - }
{ + ORS 86.705 to 86.795 are + } prima facie evidence { - in
any court - } of the truth of the matters set forth
{ - therein - } { + in the recitals + }, but the recitals
{ - shall be - } { + are + } conclusive in favor of a
purchaser for value in good faith relying upon { - them - }
{ + the recitals + }.
{ + (b) A trustee's deed recorded as provided in paragraph
(a) of this subsection is prima facie evidence that all
assignments of the trust deed that are required to be recorded
under ORS 86.735 are recorded, but the recording is conclusive in
favor of a purchaser for value in good faith that relies upon the
recording of the trustee's deed.
(2) A trustee's sale that forecloses a trust deed in which a
nominee is designated as beneficiary and that is completed before
the effective date of this 2013 Act is not void or voidable by
reason of the absence in the record of an assignment of the trust
deed unless the assignment changes the designation of the
beneficiary of the trust deed.
(3) An instrument that a beneficiary executes is prima facie
evidence that the beneficiary has authorization to execute the
instrument from the person that owns or holds the debt or other
obligation that the trust deed secures. The instrument is
conclusive in favor of a purchaser for value in good faith that
relies on the instrument unless, before the purchaser's reliance
begins, the beneficiary has recorded an instrument withdrawing or
repudiating the instrument it previously executed. + }
SECTION 4. ORS 86.790 is amended to read:
86.790. (1) The trustee of a trust deed under ORS 86.705 to
86.795 { - shall not be - } { + is not + } required to comply
with the provisions of ORS chapters 707 and 709 and
{ - shall - } { + must + } be:
(a) Any attorney who is an active member of the Oregon State
Bar;
(b) A financial institution or trust company, as defined in ORS
706.008, that is authorized to do business under the laws of
Oregon or the United States;
(c) A title insurance company authorized to insure title to
real property in this state, its subsidiaries, affiliates,
insurance producers or branches;
(d) The United States or any agency thereof; or
(e) Escrow agents licensed under ORS 696.505 to 696.590.
{ + (2) The person named or otherwise designated as the
beneficiary in a trust deed may not be the trustee under the
trust deed unless the person is qualified to be a trustee under
subsection (1)(d) of this section. + }
{ - (2) - } { + (3) + }An attorney who is a trustee under
subsection (1)(a) of this section may represent the beneficiary
in addition to performing the duties of trustee.
{ - (3) - } { + (4) + } At any time after the trust deed is
executed, the beneficiary may appoint in writing another
qualified trustee. If the appointment of the successor trustee is
recorded in the mortgage records of the county or counties in
which the trust deed is recorded, the successor trustee shall be
vested with all the powers of the original trustee.
{ - (4) - } { + (5) + } A trustee or successor trustee is a
necessary and proper party to any proceeding to determine the
validity of or enjoin any private or judicial proceeding to
foreclose a trust deed, but a trustee or successor trustee is
neither a necessary nor a proper party to any proceeding to
determine title to the property subject to the trust deed, or to
any proceeding to impose, enforce or foreclose any other lien on
the subject property.
{ - (5) - } { + (6) + } Nothing in ORS 86.705 to 86.795
imposes a duty on the trustee or successor trustee to notify any
person of any proceeding with respect to such person, except a
proceeding initiated by the trustee or successor trustee.
{ - (6) - } { + (7) + } A trustee or the attorney for the
trustee or any agent designated by the trustee or the attorney
may announce and accept a bid from the beneficiary whether or not
the beneficiary is present at the sale.
{ - (7) - } { + (8) + } The trustee or successor trustee
shall have no fiduciary duty or fiduciary obligation to the
grantor or other persons having an interest in the property
subject to the trust deed. The trustee or successor trustee shall
not be relieved of the duty to reconvey the property subject to
the trust deed to the grantor upon request for reconveyance by
the beneficiary.
SECTION 5. { + Section 6 of this 2013 Act is added to and made
a part of ORS 86.705 to 86.795. + }
SECTION 6. { + (1) A beneficiary, including a beneficiary
designated as an agent or nominee, may designate an agent or
nominee to act on behalf of the beneficiary.
(2) A third party may rely on a designation of an agent or
nominee in the recorded trust deed or in a separate document that
has been recorded in the records of the counties in which the
trust deed was recorded unless:
(a) Termination of the designation has been recorded in the
records; or
(b) The third party has actual notice that the designation has
been terminated.
(3) The recording of the original trust deed establishes the
identity of the original beneficiary as agent or nominee for a
successor in interest unless:
(a) An assignment to the successor in interest has been
recorded and the assignment does not designate the original
beneficiary as agent or nominee for the successor in interest; or
(b) A document has been recorded that designates a person other
than the original beneficiary as agent or nominee for the
successor in interest. + }
SECTION 7. { + Section 6 of this 2013 Act and the amendments
to ORS 86.705, 86.735, 86.780 and 86.790 by sections 1 to 4 of
this 2013 Act apply to all foreclosures by advertisement and
sale, whether commenced before, on or after the effective date of
this 2013 Act. + }
SECTION 8. { + This 2013 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2013 Act takes effect on its
passage. + }
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