Article 9 and Lien-Related Legislation
Arizona: HB 2645, which would increase the penalty for a person who files a UCC record without authorization that the person knows contains a material misstatement or false claim from a misdemeanor to a class 3 felony, passed the House on 2/23/2022. Committee assignment is pending in the Senate.
Indiana: HB 1092, which would delete a non-uniform notice portion of the state’s UCC § 9-502, passed the Senate as amended on 2/22/2022 and was returned to the House for concurrence. The non-uniform provision requires the secured party to send a copy of a financing statement to the debtor within 30 days of filing. Indiana is the only state that has such a requirement. It has been in place since Revised Article 9 was took effect in 2001. If enacted, this bill would delete the notice requirement.
Other Uniform Laws Legislation
No developments to report.
Emerging Technology Legislation (Blockchain, DLT, Cryptocurrency, etc.)
California: Assembly Bill 2689 was introduced on 2/18/2022 to authorize a private or public entity in the state to accept virtual currency as a method of payment for the provision of any good or service, including any governmental service. Committee assignment is pending.
California: Assembly Bill 2781 was introduced on 2/18/2022 to require the Employment Development Department to study the feasibility of utilizing blockchain technology. Committee assignment is pending.
Illinois: HB 5287, which would provide that the department of revenue may adopt rules that allow payments in cryptocurrency for any amount due to the department under any Act, passed the House on 2/24/2022. The bill also defines “cryptocurrency” for purposes of the Act. Committee assignment is pending in the Senate.
Indiana: HB 1211, which would direct the department of administration to gather information on how blockchain technology could be used by a state agency, passed the Senate as amended on 2/21/2022. The purpose of the information gathering would be to: (i) achieve greater cost efficiency and cost effectiveness; and (ii) improve consumer convenience, experience, data security, and data privacy. The bill was returned to the House for concurrence.
Indiana: SB 351, which would add new Chapter 11 to the state’s UCC, passed the House as amended on 2/22/2022. This bill originally focused on ownership, control and perfection of a security interest in virtual currency but was amended to instead apply the concepts to controllable electronic records. The bill was returned to the Senate for concurrence.
Iowa: HB 2443, which would provide that a record or signature shall not be denied legal effect because it is created or stored by means of distributed ledger technology or smart contract, passed the House on 2/24/2022. The bill provides in a new code section that the ownership of the secure information remains with the person who provided the signature, not the distributed ledger technology owner, and repeals a similar provision. The bill is pending committee assignment in the Senate.
Michigan. Senate Bill 888 was introduced on 2/24/2022 to establish the blockchain and cryptocurrency commission. The commission would investigate blockchain and cryptocurrency to develop a master plan of recommendations for fostering an expansion of blockchain technology and the cryptocurrency industry. The bill was assigned to the Senate Economic and Small Business Development Committee.
Utah: SB 182, which would enact the Digital Asset Management Act to establish a framework for the regulation of digital assets, passed the Senate as substituted on 2/23/2022. The substitute bill eliminated much of the original text, including provisions that would have (i) provided for perfection of a security interest in digital assets by filing or control; (ii) set the conditions under which a transferee takes free of a security interest in digital assets; (iii) authorized banks to provide custodial services for digital assets; and (iv) defined what constitutes control of virtual currency. The current bill would provide definitions, classify digital assets as intangible personal property and clarify how an owner may demonstrate ownership of such assets; Committee assignment is pending in the House.
Wyoming: HB 70, which would establish civil and criminal penalties for the unlawful impersonation of a digital identity through electronic means, passed the House on 2/18/2022 and is now pending in the Senate Minerals, Business and Economic Development Committee.
Wyoming: SB 68, which would amend provisions related to decentralized autonomous organizations (DAOs), passed the Senate on 2/24/2022 and is pending in the House. The bill updates the DAO law enacted last year by (i) amending definitions; (ii) making technical corrections; (iii) amending the obligations of members and dissociated members; (iv) amending factors for dissolution of a decentralized autonomous organization; and (v) repealing definitions and provisions related to DAOs.
Business Organization Legislation
Wisconsin: SB 566 (2021), which would adopt, with modifications, the most recent versions of the Uniform Limited Partnership Act and Uniform Limited Liability Company Act, passed the Senate on 2/22/2022. The bill was then immediately passed by the Assembly on 2/23/2022. The bill also would make changes to the state’s partnership law and to the law governing business corporations and nonstock corporations. The bill is awaiting delivery to the governor.
Notary Legislation
Alabama: Senate Bill 247 was introduced on 2/22/2022 to authorize notaries to perform notarial acts for remotely located individuals, establish a journal requirement and provide that a tangible copy of an electronic record that has been certified by a notary public is a certified copy for the purposes of recording certain documents affecting title to property. The bill was assigned to the Senate Judiciary Committee.
California: Assembly Bill 2834 was introduced on 2/18/2022 to allow a notary public to correct an error on a certificate under specified circumstances, including that the correction will not affect the signatory individuals in any way. Committee assignment is pending.
Connecticut: Senate Bill 219 was introduced on 2/24/2022 to eliminate the maximum fee payable to a notary public. The bill was assigned to the Joint Commerce Committee.
Maryland: SB 317, which would authorize an increase in the maximum fee a notary may charge from $4 to $25, passed the Senate on 2/24/2022. The bill is pending committee assignment in the House.
Ohio: Senate Bill 300 was introduced on 2/22/2022 to amend the state’s notary law with respect to taking acknowledgements and proof of identity. Committee assignment is pending.
Real-Estate-Recording-Related Legislation
Indiana: The Senate concurred in House amendments to SB 357 on 2/22/2022. This bill would provide that a county recorder may not refuse a record simply because it is in electronic form. The bill is awaiting delivery to the governor.
Wisconsin: SB 865, which would require that that covenants and restrictions for a planned community be recorded with the register of deeds of every county where the community is located by the homeowners association, passed the Assembly on 2/23/2022. The bill also requires the Department of Financial Institutions to create a filing system for certain notices by homeowners associations. The bill is pending delivery to the governor.
Other Items/Legislation of Interest
No developments to report.
………………………..
Note that this update provides only a short summary of the listed bills, which are often lengthy and complex. It is not intended to include all potentially relevant provisions of each bill. For full details, please review the bill on the applicable state legislative web site.