Legal Alert: Indiana Changes Recording Requirements

Posted: 06/26/2020 | Employment, Business

Previous Requirement Language

Indiana Code (“IC”) § 32-21-2-3(a) states that for a conveyance, a mortgage, or an instrument of writing (collectively “Instruments”) to be recorded, it must be acknowledged by either the grantor, or other signer (“Grantor”) before certain authorized notarial officers (“Notary”) or a common law proof described in IC § 32-21-2-6 (“Proof”). One form of Proof, was a disinterested person signing as a witness. In practice, this has been accomplished by the Grantor including the written certificate of acknowledgement by a Notary on an Instrument. The purpose of this acknowledgement is to validate that the Instrument was the act of the Grantor.

“Or” to “And”

Effective July 1, 2020, the statutory language of IC § 32-21-2-3(a) has been changed to require both the acknowledgement by the Grantor and the inclusion of Proof. This change in statutory language was enacted pursuant to Senate Enrolled Act 340 that was passed during the 2020 Indiana Legislative session. In practice, the new requirements can be met by having the Grantor and a disinterested witness sign the Instrument, both with separate Notary acknowledgements.

If the Instrument is recorded without the additional Proof required, it is not necessarily invalid for all purposes. Pursuant to IC § 32-21-4-1(c), even an instrument that is recorded without complying with all of the new requirements stated above, will be considered validly recorded and sufficient to provide constructive notice to a bona fide purchaser. However, this statute only applies to a select group of Instruments and should not be relied on to protect deficient Instruments. Additionally, as the language is new, there is no case law, and limited guidance, as to how to treat non-compliant Instruments in bankruptcy and other proceedings.

Next Steps

While this provision may be changed in subsequent legislative sessions, for now, any document that you intend to record should meet the aforementioned requirements. Additionally, any recorded document should be reviewed by the Rothberg real estate team to ensure it is in compliance with the Indiana recording statues and new language. For your convenience, the proper language required for the Notary acknowledgement and proof are contained on page 4 and 5 of the Indiana State Bar Association directive, a link to which is included herein.

More Information

Text of Senate Enrolled Act 340
Indiana State Bar directive

If you have any questions related to this content, please contact any of us or your Rothberg attorney.

Alexander J. Platte, Partner|[email protected]
Thomas B. Trent
, Partner|[email protected]
Jared C. Helge
, Partner|[email protected]
Michael T. Deam
, Partner|[email protected]
Phillip W. Smith II, Associate

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