As Reported by the Senate Insurance and Financial Institutions Committee

130th General Assembly
Regular Session
2013-2014
Sub. H. B. No. 201


Representative Butler 

Cosponsors: Representatives Adams, J., Terhar, Thompson, Hayes, Adams, R., Amstutz, Anielski, Beck, Bishoff, Blair, Blessing, Boyce, Budish, Burkley, Conditt, Green, Hood, Huffman, Letson, Milkovich, Perales, Retherford, Strahorn, Sykes, Winburn Speaker Batchelder 


A BILL
To amend section 5301.36 and to enact section 1
5301.361 of the Revised Code to make changes 2
relative to entries of satisfaction.3


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That section 5301.36 be amended and section 4
5301.361 of the Revised Code be enacted to read as follows:5

       Sec. 5301.36.  (A) Except in a county in which the county 6
recorder has elected to require that all satisfactions of 7
mortgages be recorded by separate instrument as allowed under 8
section 5301.28 of the Revised Code, when recording a mortgage, 9
county recorders shall leave space on the margin of the record for 10
the entry of satisfaction, and record therein the satisfaction 11
made on the mortgage, or permit the owner of the claim secured by 12
the mortgage to enter such satisfaction. Such record shall have 13
the same effect as the record of a release of the mortgage.14

       (B) Within ninety days from the date of the satisfaction of a 15
residential mortgage, the mortgagee shall record a release of the 16
mortgage evidencing the fact of theits satisfaction in the 17
appropriate county recorder's office and pay any fees required for 18
the recording. The mortgagee may, by contract with the mortgagor, 19
recover the cost of the fees required for the recording of the 20
satisfaction by the county recorder.21

       (C) If the mortgagee fails to comply with division (B) of 22
this section, the mortgagor of the unrecorded satisfaction and the 23
current owner of the real property to which the mortgage pertains24
may recover, in a civil action, damages of two hundred fifty 25
dollars. This division does not preclude or affect any other legal 26
remedies or damages that may be available to the mortgagor.27

       (D)(1) If upon the expiration of the ninety-day period 28
described in division (B) of this section, the satisfaction of 29
mortgage remains unrecorded, the current owner of the real 30
property shall provide the mortgagee written notice, in accordance 31
with the Rules of Civil Procedure, of the failure to enter the 32
release of the mortgage of record. The notice shall be in 33
substantially the following form:34

"OHIO LAW REQUIRES A MORTGAGEE, WHETHER THE ORIGINAL MORTGAGEE OR 35
ANY SUCCESSOR TO THE INTEREST OF THE ORIGINAL MORTGAGEE, TO RECORD 36
A RELEASE OF A MORTGAGE EVIDENCING ITS SATISFACTION IN THE 37
APPROPRIATE COUNTY RECORDER'S OFFICE AND TO PAY ANY FEES REQUIRED 38
FOR THE RECORDING WITHIN A CERTAIN TIME PERIOD. (Name of 39
mortgagor)'S MORTGAGE LOAN, (loan number or other loan 40
identification), FOR PROPERTY LOCATED AT (property address), WAS 41
SATISFIED ON (date of satisfaction). IT APPEARS YOU HAVE YET TO 42
RECORD A RELEASE OF THIS MORTGAGE. FAILURE TO RECORD THE RELEASE 43
WITHIN 15 DAYS OF RECEIVING THIS NOTICE MAY RESULT IN A CIVIL 44
ACTION FILED AGAINST YOU TO RECOVER REASONABLE ATTORNEYS' FEES AND 45
COSTS INCURRED IN SUCH AN ACTION OR OTHERWISE TO OBTAIN THE 46
RECORDING, PLUS DAMAGES OF $100 FOR EACH DAY OF NONCOMPLIANCE NOT 47
TO EXCEED $5,000 IN TOTAL DAMAGES."48

       (2) Within fifteen days after delivery of the notice 49
described in division (D)(1) of this section, the mortgagee shall 50
record a release of the mortgage evidencing the fact of its 51
satisfaction in the appropriate county recorder's office and pay 52
any fees required for the recording. The mortgagee may, by 53
contract with the mortgagor or current owner of the real property, 54
recover the cost of the fees required for the recording of the 55
satisfaction by the county recorder.56

       (E) If the mortgagee fails to comply with division (D)(2) of 57
this section after receiving the notice in accordance with 58
division (D)(1) of this section, the current owner of the real 59
property may recover, in a civil action, reasonable attorneys' 60
fees and costs incurred in such an action or otherwise to obtain 61
the recording of a satisfaction of mortgage plus damages of one 62
hundred dollars for each day of noncompliance, not to exceed five 63
thousand dollars in total damages.64

       This division does not preclude or affect any other legal 65
remedies or damages that may be available to the current owner.66

       (F) A mortgagee that records a release of a mortgage 67
evidencing the fact of its satisfaction within the time periods 68
required by this section shall not be in violation of this 69
section, or subject to damages or fees, due to the failure of a 70
county recorder to timely process that release of mortgage.71

       (G) A current owner may combine the civil actions described 72
in divisions (C) and (E) of this section by bringing one action to 73
collect for both damages, or may bring separate actions.74

       (H) As used in this section, "residential mortgage" means an 75
obligation to pay a sum of money evidenced by a note and secured 76
by a lien upon:77

       (1) "Mortgagee" includes the original mortgagee or any 78
successor to or assignee of the original mortgagee.79

       (2) realproperty located within this state containing two 80
or fewer residential units or on which two or fewer residential 81
units are to be constructed and shall include such an 82
"Satisfaction" means that the obligation on a residential 83
condominium or cooperative unit secured by a mortgage has been 84
paid in full and the underlying obligation terminated, with no 85
opportunities for future advancements.86

       Sec. 5301.361. (A)(1) With respect to an unreleased 87
commercial mortgage that has been satisfied more than ninety days 88
prior to the effective date of this section, but not recorded, the 89
mortgagee shall not be subject to a civil action or damages as 90
described in division (C) of section 5301.36 of the Revised Code.91

       (2) The current owner of the real property to which such a 92
mortgage pertains shall provide the mortgagee the written notice 93
described in division (D)(1) of section 5301.36 of the Revised 94
Code not sooner than on the effective date of this section and may 95
recover damages in a civil action for failure to comply with 96
division (D)(2) of that section pursuant to division (E) of that 97
section.98

       (B)(1) With respect to an unreleased commercial mortgage that 99
has been satisfied less than ninety days prior to the effective 100
date of this section, but not recorded, the mortgagee shall not be 101
subject to a civil action or damages as described in division (C) 102
of section 5301.36 of the Revised Code.103

       (2) The current owner of the real property to which such a 104
mortgage pertains shall provide the mortgagee the written notice 105
described in division (D)(1) of section 5301.36 of the Revised 106
Code not sooner than on the ninetieth day after the mortgage was 107
satisfied and may recover damages in a civil action for failure to 108
comply with division (D)(2) of that section pursuant to division 109
(E) of that section.110

       (C)(1) With respect to an unreleased residential mortgage 111
that has been satisfied, but not recorded, prior to the effective 112
date of this section, the mortgagee shall be subject to a civil 113
action or damages as described in division (C) of section 5301.36 114
of the Revised Code for failure to comply with division (B) of 115
that section.116

       (2) If such a mortgage was satisfied more than ninety days 117
prior to the effective date of this section, the current owner of 118
the real property to which the mortgage pertains shall provide the 119
mortgagee the written notice described in division (D)(1) of 120
section 5301.36 of the Revised Code not sooner than on the 121
effective date of this section and may recover damages in a civil 122
action for failure to comply with division (D)(2) of that section 123
pursuant to division (E) of that section. If such a mortgage was 124
satisfied less than ninety days prior to the effective date of the 125
section, the current owner shall provide the mortgagee the written 126
notice described in division (D)(1) of section 5301.36 of the 127
Revised Code not sooner than on the ninetieth day after the 128
mortgage was satisfied and may recover damages in a civil action 129
for failure to comply with division (D)(2) of that section 130
pursuant to division (E) of that section. 131

       (D) As used in this section, "mortgagee" has the same meaning 132
as in section 5301.36 of the Revised Code.133

       Section 2. That existing section 5301.36 of the Revised Code 134
is hereby repealed.135