75th OREGON LEGISLATIVE ASSEMBLY--2009 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 1939
B-Engrossed
House Bill 3004
Ordered by the House June 2
Including House Amendments dated April 30 and June 2
Sponsored by Representatives CLEM, C EDWARDS (at the request of
Jane Cummins)
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.
Provides that sale by trustee of foreclosed property or sale of
residential property after judicial foreclosure precludes further
action against mortgagor { + , + } { - or - } grantor { + or
other specified obligor + } for deficiencies in amount secured by
mortgage or trust deed. Creates exceptions.
{ + Specifies to whom trustee must send amended notice of
sale. Specifies means by which trustee must give notice. + }
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to sales of foreclosed property; creating new
provisions; amending ORS 86.755, 86.770 and 88.070; and
declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 86.755 is amended to read:
86.755. (1) The { + trustee shall hold the trustee's + } sale
{ - shall be held - } on the date and at the time and place
designated in the notice of sale. The trustee may sell the
property in one parcel or in separate parcels and shall sell the
parcel or parcels at auction to the highest bidder for cash. Any
person, including the beneficiary under the trust deed, but
excluding the trustee, may bid at the trustee's sale. The
attorney for the trustee, or { - any agent designated by - }
{ + an agent that + } the trustee or the attorney { +
designates + }, may conduct the sale and act in the sale as the
{ + trustee's + } auctioneer { - of the trustee - } .
(2) The trustee or the attorney for the trustee, or { - any
agent designated by - } { + an agent that + } the trustee or
the attorney conducting the sale { + designates + }, may
postpone the sale for one or more periods totaling not more than
180 days from the original sale date, giving notice of each
adjournment by public proclamation made at the time and place set
for sale. { - The proclamation may be made by - } The trustee,
the attorney { - , or any agent designated by - } { + or an
agent that + } the trustee or the attorney { + designates may
make the proclamation + }.
(3) The purchaser shall pay at the time of sale the price bid,
and, within 10 days following payment, the trustee shall execute
and deliver the trustee's deed to the purchaser.
(4) The trustee's deed shall convey to the purchaser the
interest in the property { - which - } { + that + } the
grantor had, or had the power to convey, at the time { - of the
execution by the grantor of - } { + the grantor executed + } the
trust deed, together with any interest the grantor or the
grantor's successors in interest acquire after the execution of
the trust deed.
(5) The purchaser at the trustee's sale shall be entitled to
possession of the property on the 10th day following the sale,
and any persons remaining in possession after that day under any
interest, except one prior to the trust deed or created
voluntarily by the grantor or a successor of the grantor, shall
be deemed to be tenants at sufferance. All persons not holding
under an interest prior to the trust deed may be removed from
possession by following the procedures set out in ORS 105.105 to
105.168 or other applicable judicial procedure, provided that a
person holding under an interest created voluntarily by the
grantor or a successor of the grantor must first receive 30 days'
written notice of the intent to remove that person served no
earlier than 30 days before the date first set for the sale.
Notices under this subsection shall be served by first class
mail. 'First class mail' for purposes of this section does not
include certified or registered mail, or any other form of mail
which may delay or hinder actual delivery of mail to the
addressee.
(6) { + (a) + } Notwithstanding subsection (2) of this section,
except when a beneficiary has participated in obtaining a stay,
foreclosure proceedings that are stayed by order of the court, by
proceedings in bankruptcy or for any other lawful reason shall,
after release from the stay, continue as if uninterrupted, if
within 30 days after release the trustee { - gives - } { +
sends + } amended notice of sale by registered or certified mail
to the last-known address of { - those - } { + the + }
persons listed in ORS 86.740 and 86.750 (1) { + . + } { - and
to - }
{ + (b) In addition to the notice required under paragraph
(a) of this subsection, the trustee shall send amended notice of
sale:
(A) By registered or certified mail to:
(i) + } The address provided by each person who was present at
the time and place set for the sale { - which - } { +
that + } was stayed { - . - } { + ; and
(ii) The address provided by each member of the Oregon State
Bar who by registered or certified mail requests the amended
notice of sale and includes with the request the notice of
default or an identification number for the trustee's sale that
would assist the trustee in identifying the property subject to
the trustee's sale and a self-addressed, stamped envelope
measuring at least 8.5 by 11 inches in size; or
(B) By posting a true copy or a link to a true copy of the
amended notice of sale on the trustee's Internet website.
(7) + } The amended notice of sale { - shall - } { +
must + }:
(a) Be given at least 20 days prior to the amended date of
sale;
(b) Set an amended date of sale { - which - } { + that + }
may be the same as the original sale date, or date to which the
sale was postponed, provided the requirements of { + this
subsection and + } ORS 86.740 { - , - } { + and + } 86.750
{ - and this subsection - } are satisfied;
(c) Specify the time and place for sale;
(d) Conform to the requirements of ORS 86.745; and
(e) State that the original sale proceedings were stayed and
the date the stay terminated.
{ - (7) - } { + (8) + } If the publication of the notice of
sale was not completed { - prior to - } { + before + } the
date the foreclosure proceedings were stayed by order of the
court, by proceedings in bankruptcy or for any other lawful
reason, after release from the stay, in addition to complying
with the provisions of { - subsection (6) - } { + subsections
(6) and (7) + } of this section, the trustee shall complete the
publication by publishing an amended notice of sale
{ - which - } { + that + } states that the notice has been
amended following release from the stay { - , and which - }
{ + and that + } contains the amended date of sale. The amended
notice { - shall - } { + must + } be published in a newspaper
of general circulation in each of the counties in which the
property is situated once a week for four successive weeks,
except that the required number of publications { - shall - }
{ + must + } be reduced by the number of publications that were
completed { - prior to - } { + before + } the effective date
of the stay. The last publication
{ - shall - } { + must + } be made more than 20 days
{ - prior to - } { + before + } the date the trustee conducts
the sale.
SECTION 2. ORS 86.770 is amended to read:
86.770. { - (1) A sale made by a trustee under ORS 86.705 to
86.795 shall foreclose and terminate all interest in the property
covered by the trust deed of all persons to whom notice is given
under ORS 86.740 and 86.750 and of any other person claiming by,
through or under such persons, and such persons shall have no
right to redeem the property from the purchaser at the trustee's
sale. The failure to give notice to any of these persons shall
not affect the validity of the sale as to persons so
notified. - }
{ - (2) Except as provided in subsection (4) of this section,
no other or further action shall be brought, nor judgment entered
for any deficiency, against the grantor, or the grantor's
successor in interest, if any, on the note, bond, or other
obligation secured by the trust deed or against any other person
obligated on such note, bond or other obligation after a sale is
made: - }
{ - (a) By a trustee under ORS 86.705 to 86.795; or - }
{ - (b) Under a judicial foreclosure of a residential trust
deed. - }
{ - (3) Notwithstanding ORS 88.070, when there is a judicial
foreclosure of a trust deed that is not a residential trust deed,
the judgment shall provide that if the sale proceeds are
insufficient to satisfy the judgment, execution may issue for any
amount by which the unpaid balance of the obligation secured by
the trust deed exceeds the net sale proceeds payable to the
beneficiary. - }
{ - (4) Nothing in this section shall preclude an action
judicially or nonjudicially foreclosing the same trust deed as to
any other property covered thereby, or any other trust deeds,
mortgages, security agreements, or other consensual or
nonconsensual security interest or liens covering any other real
or personal property security for the note, bond or other
obligation secured by the trust deed under which a sale has been
made or an action against a guarantor to the extent of any
remaining deficiency following judicial foreclosure. A guarantor
of an obligation secured by a residential trust deed shall not
have the right to recover any deficiency from the grantor or any
successor in interest of the grantor. - }
{ + (1) If, under ORS 86.705 to 86.795, a trustee sells
property covered by a trust deed, the trustee's sale forecloses
and terminates the interest in the property that belongs to a
person entitled to notice of the sale under ORS 86.740 and 86.750
or to a person that claims an interest by, through or under the
person entitled to notice. A person whose interest the trustee's
sale foreclosed and terminated may not redeem the property from
the purchaser at the trustee's sale. A failure to give notice to
a person entitled to notice does not affect the validity of the
sale as to persons that were notified.
(2) Except in accordance with subsection (4) of this section,
after a trustee's sale under ORS 86.705 to 86.795 or after a
judicial foreclosure of a residential trust deed, an action for a
deficiency may not be brought or a judgment entered against the
grantor, the grantor's successor in interest or another person
obligated on:
(a) The note, bond or other obligation secured by the
residential trust deed for the property that was subject to the
trustee's sale or the foreclosure;
(b) Any other note, bond or other obligation secured by a
residential trust deed for or mortgage on the property that was
subject to the trustee's sale or the foreclosure when the debt,
of which the note, bond or other obligation is evidence, is owed
to the beneficiary in the residential trust deed that was subject
to the trustee's sale or the foreclosure; or
(c) A note, bond or other obligation that is evidence of a debt
that the grantor or the grantor's successor in interest incurred
to finance the unpaid portion of the purchase price of the
property that was subject to the trustee's sale or the
foreclosure.
(3) Notwithstanding ORS 88.070, in a judicial foreclosure of a
trust deed that is not a residential trust deed the judgment must
provide that if the sale proceeds are insufficient to satisfy the
judgment, execution may issue for the amount by which the unpaid
balance of the obligation secured by the trust deed exceeds the
net sale proceeds payable to the beneficiary.
(4) This section does not preclude:
(a) An action that forecloses, judicially or nonjudicially:
(A) Other property covered by the trust deed that is the
subject of the foreclosure; or
(B) Another trust deed, mortgage, security agreement,
consensual or nonconsensual security interest or lien that covers
other real or personal property that is also used as security for
the note, bond or other obligation that is secured by the trust
deed for the property that was sold.
(b) An action against a guarantor for a deficiency that remains
after a judicial foreclosure.
(5) A guarantor of an obligation secured by a residential trust
deed may not recover a deficiency from the grantor or a successor
in interest of the grantor. + }
SECTION 3. ORS 88.070 is amended to read:
88.070. When real property is sold pursuant to a judgment
foreclosing a mortgage { + that was given to secure an unpaid
portion of the purchase price of the real property + } and the
proceeds of the sale are not adequate to satisfy the amounts
secured by the mortgage, all judgment remedies for collection of
the unsatisfied amounts expire when the sale is made { + . + }
{ - if: - }
{ - (1) The mortgage was given to a seller to secure the
unpaid balance of the purchase price of real property; or - }
{ - (2) The mortgage was given after September 13, 1975, to a
person other than a seller to secure not more than $50,000 of the
unpaid balance of the purchase price of real property used by the
purchaser as the primary or secondary single family residence of
the purchaser. - }
SECTION 4. { + (1) The amendments to ORS 86.755 by section 1
this 2009 Act apply to sales that occur on or after the effective
date of this 2009 Act.
(2) The amendments to ORS 86.770 and 88.070 by sections 2 and 3
of this 2009 Act apply to a trust deed or mortgage or a note,
bond or other obligation secured by a trust deed or mortgage that
was executed before, on or after the effective date of this 2009
Act. + }
SECTION 5. { + This 2009 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2009 Act takes effect on its
passage. + }
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