Instrument Recording in California

Recently, County Recorders across California appear to have become more particular in their review of instruments presented for recording. Many questions have arisen as a result, such as the required form of instruments and acknowledgments for recording, what information must be included to constitute a proper legal description for recording, and what is the scope of a County Recorder’s authority in reviewing instruments for recording. Outlined below is a brief discussion of these questions.

What is the required form of instrument for recording?

The instrument should be printed on 8-1/2 x 11 inch paper, but must be on paper no larger than 8-1/2 x 14 inches. Any instrument on paper larger than 8-1/2 x 11 inch paper is subject to extra per page recording fees. The first page of all instruments presented for recording must reserve at least the top 2-1/2 inches for recording information, the left 3-1/2 inches of such space shall be for the name of the person requesting the recording, and the name and return address of the person to whom the recorded instrument should be sent. The title of the instrument must appear on the first page immediately below the 2-1/2 inches reserved for recording information. In the event the first page of the instrument does not comply with these requirements, a separate first page may be prepared consistent with these requirements and attached to the face of the instrument. At least a 1/2 inch margin must exist on both the left and right sides of each page of the instrument. See Cal.Gov. Code §§ 27361-27361.6.

What is the required form of acknowledgment?

In general, unless specifically exempt (e.g., certified copies of certain court documents), an instrument presented for recording must contain an original signature which has been properly acknowledged. California has adopted a general form of acknowledgment, which is contained in California Civil Code § 1189. This form is acceptable if completed by a Notary Public in California, or by a Notary Public in another jurisdiction. In addition, any Certificate of Acknowledgment taken in another state is sufficient in California if taken in accordance with the laws of the state where the acknowledgment was made. Cal.Civ. Code § 1189(a) and (b).

What is a proper legal description for recording?

As a general matter, an instrument need only contain a legal description sufficient to identify the particular real property affected in order to be recorded and provide constructive notice. The real property may be described in the instrument itself, or it may refer to another recorded instrument (e.g., by that instrument’s date of recording and an instrument number or book and page) which adequately describes the real property. See Miller & Starr, California Real Estate Law 2d, § 8:13 (1999) for a general discussion. While many County Recorders insist on the inclusion of the Assessor’s Parcel Numbers affected as part of the legal description, the only County Recorder authorized to impose such a requirement is the Los Angeles County Recorder, following adoption of an authorizing resolution by the Los Angeles County Board of Supervisors. See Cal.Gov. Code § 27297.6. If the real property is otherwise adequately described, the failure to include the Assessor’s Parcel Numbers will not impact the notice provided once the instrument is recorded. Moreover, the description of real property by Assessor Parcel Number alone is legally insufficient.

What is the County Recorder’s Duty with respect to recording instruments?

  Upon the payment of proper recording fees and taxes, the Recorder is required to accept for recordation any instrument authorized or required by statute or court order to be recorded, so long as the instrument contains sufficient information to be indexed, meets recording requirements, and is photographically reproducible. A Recorder may not refuse to record an instrument otherwise meeting these requirements on the basis of the instrument’s lack of legal sufficiency. Cal.Gov. Code § 27201. Moreover, a Recorder is liable for damages suffered by an aggrieved party if the Recorder refuses to record within a reasonable time after receipt any instrument which may be recorded under law and meets the requirements for recordation.

Mms Issues New Federal Oil Royalty Regulations

On March 15, 2000, the Minerals Management Service (“MMS”) issued final oil royalty regulations. The new regulations impose on Federal oil and gas lessees a duty to market oil. The regulations also, among other things, tie oil valuation for royalty purposes on index prices. The index used varies on location. In the Rocky Mountain Region, where a somewhat competitive market exists, oil producers may calculate royalties based on certain benchmarks, which begin with a tendering program. On the West Coast, oil royalties will be based on Alaska North Slope prices. For the balance of the country, oil royalties will be based on spot prices in various markets, employing generally the market closest to the actual production. These new regulations, which take effect on June 1, 2000, have been the subject of significant controversy over the past few years. Implementation of the regulations has been repeatedly delayed by Congressional moratoria, the most recent expiring March 15, 2000. It is almost certain that the oil and gas industry will litigate the issue of imposition of a duty to market oil. Lawsuits are pending on the imposition of a duty to market gas included in the gas royalty regulations issued by the MMS in late 1997.