Chapter 254 Oregon Laws 2001

AN ACT

HB 2610

Relating to release of trust deed; creating new provisions; and amending ORS 86.720.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 86.720 is amended to read:

86.720. (1) Within 30 days after performance of the obligation secured by the trust deed, the beneficiary shall deliver a written request to the trustee to reconvey the estate of real property described in the trust deed to the grantor. Within 30 days after the beneficiary delivers the written request to reconvey to the trustee, the trustee shall reconvey the estate of real property described in the trust deed to the grantor. In the event the obligation is performed and the beneficiary refuses to request reconveyance or the trustee refuses to reconvey the property, the beneficiary or trustee so refusing shall be liable as provided by ORS 86.140 in the case of refusal to execute a discharge or satisfaction of a mortgage on real property. The trustee may charge a reasonable fee for all services involved in the preparation, execution and recordation of any reconveyance executed pursuant to this section.

(2) If a full reconveyance of a trust deed has not been executed and recorded pursuant to the provisions of subsection (1) of this section within 60 calendar days of the date the obligation secured by the trust deed was fully satisfied, then:

(a) If the obligation was satisfied by a title insurance company or agent or by payment through an escrow transacted by [the] a title insurance company or agent, upon the written request of the grantor or the grantor’s successor in interest, the tender of reasonable charges and the compliance with the notice requirements of subsection (3) of this section, the title insurance company or agent shall prepare, execute and record a release of trust deed.

(b) [In all cases not described in paragraph (a) of this subsection, upon the written request of the grantor or the grantor’s successor in interest, the tender of reasonable charges and the] Upon compliance with the notice requirements of subsection (3) of this section, [the] any title insurance company or agent may prepare, execute and record a release of trust deed.

(3) Prior to the issuance and recording of a release pursuant to this section, the title insurance company or agent shall give notice of the intention to record a release of trust deed to the [trustee (except when the title company or agent is the trustee), grantor and] beneficiary of record[, or their successors in interest of record] and, if different, the party to whom the full satisfaction payment was made. [Notice shall be effective upon receipt. Such] The notice shall:

(a) Provide that the parties to whom [such] the notice is sent shall have a period of 30 days from the date of mailing to send to the title insurance company or agent their written objections to the execution and recording of the release of trust deed; [and]

(b) Be [delivered] sent by [certified] first class mail with [return receipt and] postage prepaid, addressed to the named interested parties at their last-known addresses; and

(c) Identify the trust deed by the name of the original grantor and any successor in interest on whose behalf payment was made and by the recording reference.

(4) The release of trust deed shall recite on the first page that it has been executed and recorded pursuant to the provisions of this section. The release shall be properly acknowledged and shall set forth:

(a) The name of the beneficiary to whom the payment was made;

(b) The name of the original grantor of the trust deed and any successor in interest on whose behalf payment was made;

(c) The recording reference to the trust deed that is to be released;

(d) A recital that the obligation secured by the trust deed has been paid in full;

(e) The date and amount of payment;

(f) The date of [receipt] mailing of notice required by this section; and

(g) A recital that no written objections were received by the title insurance company or agent.

(5) The release of trust deed executed pursuant to this section shall be entitled to recordation and, when recorded, shall be deemed to be the equivalent of a reconveyance of a trust deed.

(6) The title insurance company or agent shall not record or cause to be recorded a release of trust deed when any of the following circumstances exist:

(a) The 30-day period following notice given under this section has not expired; or

(b) Written objection to such recordation has been received by the title insurance company or agent from any of the parties to whom notice was sent.

(7) The trustee, title insurance company or agent may charge a reasonable fee for all services involved in the preparation, execution, recordation and compliance with this section, to effect the release of trust deed.

(8) Subsection (2) of this section does not excuse the beneficiary or trustee from compliance with subsection (1) of this section.

(9) In addition to any other remedy provided by law, a title insurance company or agent preparing, executing or recording a release of trust deed shall be liable to any party for damages that [any person may sustain] the party sustains by reason of the negligence or willful misconduct of the title insurance company or agent in connection with the issuance, execution or recording of the release pursuant to this section. Except as provided in subsection (10) of this section, the court may award reasonable attorney fees to the prevailing party in an action under this section.

(10) The court may not award attorney fees to a prevailing defendant under the provisions of subsection (9) of this section if the action under this section is maintained as a class action pursuant to ORCP 32.

(11) As used in this section, “agent” means an authorized issuer of title insurance policies of a title insurance company who is licensed as an agent for that purpose pursuant to ORS chapter 744.

(12) Subsections (2) to (11) of this section shall be applicable only to full reconveyances of the property described in the trust deed and not to reconveyances of parts or portions of the property.

(13) Subsections (1) to (12) of this section are applicable to all trust deeds, whether executed before, on or after November 4, 1993.

(14) A title insurance company or agent is not required to prepare, execute and record a release of trust deed under subsections (2) to (12) of this section if the obligation secured by the trust deed was satisfied prior to November 4, 1993.

SECTION 2. The amendments to ORS 86.720 by section 1 of this 2001 Act apply to the release of a trust deed executed on or after the effective date of this 2001 Act.

Approved by the Governor May 30, 2001

Filed in the office of Secretary of State May 30, 2001

Effective date January 1, 2002

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