ARIZONA STATE SENATE
Phoenix, Arizona
Invalidates all
non-consensual liens except those specifically listed in statute.
Before 1997, Arizona law did not prohibit
individuals and groups from filing commercial and common law liens against any owner of Arizona real estate. According to the Uniform Commercial Code,
these types of liens are fraudulent if not signed by both parties, and were
deemed a form of harassment by Laws 1997, Ch 191. That legislation
required that any nonconsensual lien that was filed against real property
belonging to a public official or employee must be accompanied by an order or
judgment form a court of competent jurisdiction to be valid. Without the accompanying
judgement, the nonconsensual lien would not have the force or effect of law. After the passage of this legislation these
kinds of filings were considerably reduced according to the County Recorder’s
Office and the Land Title Association of Arizona (LTAA).
The only
nonconsensual liens currently considered valid against a public officer or
employee are those recorded in conformity to Arizona law by a validly licensed
utility or water delivery company, a mechanics’ lien claimant or an entity
created under covenants, conditions, restrictions or declarations affecting
real property. However, nonconsensual
liens can still be filed against members of the general public. Most often, title searches reveal to the
property owner that there is a lien against his or her property and, according
to LTAA, a great deal of effort is required to
prove the invalidity of a nonconsensual lien.
Property owners are often put to great expense and land transactions are
held up or lost while title companies attempt to clear an invalid lien. According to estimates by the LTAA approximately 100
of these invalid liens are filed against members of the general public each
year in Maricopa County.
There is no fiscal impact to
the state general fund.
1.
Invalidates all nonconsensual liens
except those filed by a government entity or political subdivision or agency, a
validly licensed utility or water delivery company, a mechanics’ lien claimant
or entity created under covenants, conditions, restrictions or declarations
affecting real property.
2.
Eliminates the requirement that county
recorders accept a notice of invalid lien in order for a nonconsensual lien to
be considered invalid.
3.
Eliminates the requirement that county
attorney or attorney general mail a copy of the notice of invalid lien to the
person who recorded the nonconsensual lien and the person who is designated as
creditor.
4.
Makes conforming changes.
5.
Provides
for an effective date of July 1, 2001.
1.
Invalidates
all nonconsensual liens other than liens filed by a government entity or
political subdivision or agency, a validly licensed utility or water delivery
company, a mechanics’ lien claimant, or an entity created under covenants,
conditions, restrictions or declarations affecting real property.
2.
Eliminates the requirement that county
recorders accept a notice of invalid lien in order for a nonconsensual lien to
be considered invalid.
3.
Eliminates the requirement that county
attorney or attorney general mail a copy of the notice of invalid lien to the
person who recorded the nonconsensual lien and the person who is designated as
creditor.
4.
Makes
conforming changes.
5.
Delays
the effective date from the general effective date to July 1, 2001.
3rd Read 2/14/00 30-0-0 3rd Read 3/21/00 55-0-5
Final Read 3/29/00 28-1-1
Signed by the Governor 3/31/00
Chapter 100
Prepared by Senate Staff
April 13, 2000