SC law “clarifying” the boundary will be effective at the beginning of the year.
The long awaited and much debated legislation defining the boundary line between The Palmetto State and the Tar Heel State was signed by Governor Nikki Haley on June 10. The effective date of the law is January 1, 2017.
The purpose of the law is “clarifying the original location of the boundary” with North Carolina along Horry, Dillon, Marlboro, Chesterfield, Lancaster, York, Cherokee and Spartanburg Counties and providing additional information about the plats describing the location along Greenville, Pickens and Oconee counties. In other words, our legislature doesn’t believe the law establishes a new boundary line.
As expected, much of the legislation deals with tax issues. The legislative intent is set out specifically, and includes the thought that no business or residence owner should be liable for back taxes to South Carolina nor refunds from South Carolina as a result of a change from one state to the other. And the Department of Revenue is given the authority to compromise taxes in cases that result in taxation in both states.
Several issues are of particular interest to dirt lawyers. For example, no deed recording fees or county filing fees may be charged for deeds recorded as a result of the boundary clarification.
On the effective date of the legislation, Registers of Deeds (and Clerks of Court in those affected counties that do not have ROD offices) will be required to file a Notice of State Boundary Clarification for each affected piece of property. The form is described specifically in the legislation and requires the legal description, tax map number, derivation (if available), the names of the owners of record and the “muniments of title”, a defined term meaning “documents of record setting forth a legal or equitable real property interest or incorporeal hereditament in affected lands of an owner”.
I’m a dirt lawyer of more years than I like to divulge, but I admit I had to investigate the meaning of that word. The learned source, Wikipedia, indicates a muniment of title is the written evidence a landowner can use to defend title, such as a deed, will, judgment or death certificate.
Apparently, lawyers in states with marketable title legislation may be familiar with this term. South Carolinians have neither the benefit of tidy legislation to correct our title problems nor the knowledge and widespread use of this nifty term, until now. We will all need to use and pronounce the word, muniment, next year. A North Carolina colleague asked me where the RODs and Clerks of Court will obtain the information to supply the muniments of title. My best guess is that somebody is going to have to do a lot of title work!
(Note to Professor Spitz: I apologize if you taught me that term in law school. It’s been a long, long time!)
Also of interest to dirt lawyers are provisions relating to foreclosures. A foreclosing attorney will have to file and serve the summons and complaint along with the aforesaid Notice of Boundary Clarification and an attorneys’ certification “that title to the subject real property has been searched in the affected counties and the affected jurisdictions” on all parties having interest in the real property pursuant to the muniments of title. Whew! The foreclosure can then proceed after thirty days. I’m not sure how all that will be sorted out. I assume South Carolina foreclosure lawyers will be hiring counterparts across the state line to assist in these title examinations.
How will dirt lawyers and title insurance companies deal with sales and mortgages for properties that change states? I think we are going to take these issues on a case-by-case basis and work together to sort out the various issues that are surely to arise. Be sure to involve your title insurance underwriter in these decisions rather than going out on a limb alone!