Dear ILTA Members,
One of the many benefits of taking on the role as your ILTA president is representing Idaho at the ALTA Annual Convention, which was held October 4th-7th in Scottsdale, AZ. The event was kicked off with an exciting new theme: ALTA ONE. The message throughout the convention was “Out of Many, One”. On the local, state, and national level we need to stand united. We, individually and as an industry, have endured so many changes and regulatory pressures over the past few years, there is an enormous need to work together for the success of all.
The “One” theme continued on with the message from Garry Keller’s book, The One Thing. What is the one thing you can do to make everything else easier or unnecessary? I challenge each of you to find that one thing in your day to day business and focus on it. Who knows, it could make for a very bright 2017. The board met this month to plan for the next year and come up with our ONE thing: “Involvement”. We want to challenge the membership to get more involved in the ILTA. If you simply pay your dues every year and sit on the sidelines you are not maximizing the value of your membership. Your voice matters.
Success will not come by merely finding your one thing, but by taking action. The ILTA board is dedicated to accomplishing our one thing by changing how we do a few things. This year we are moving our annual educational seminar to February. This date will enable us to bring back the legislative reception, which will allow us to share with our legislators the key issues that affect our livelihoods. This will be a great event you will not want to miss! We also are moving the location of the monthly liaison meeting to different sites to encourage more participation. We will even be holding the June liaison meeting in Coeur d’Alene, which will hopefully get more involvement out of the northern counties.
I am proud to be part of an industry that provides peace of mind to homebuyers. We will continue to face many challenges in our industry in the coming years, but nothing can di-vide us if we work together as one. Remember it is a serious business we are in, but don’t take yourself too seriously. Have fun!
2016 ALTA Annual Convention Summary – Scottsdale
The ALTA annual convention is a worthwhile event that everyone should try to attend, if not just once for the experience. ALTA continues to strive to improve value for its members including the annual convention. The event is now called ALTA One and was redesigned to improve the schedule and retool the curriculum in a format to better enhance education, business solutions, and networking. The existing program was successful but was retooled to be less structured in respects and create forums to increase communication and interaction. The speakers were fantastic and unified in ALTA’s theme of not only identifying and embracing change but providing insight on how to evolve with the change. Our industry is in a deluge of change ranging from increased regulatory requirements (CFPB, TRID, NAIC) to the sheer nature of our business on the technology side and the changing populace to work with internally and externally – millennials. Just watching ALTA in operation is instructive as it is a role model in how to evolve and embrace change as a challenge and opportunity to stay ahead of the curve and provide value to its members. ALTA One was fresh and exciting and an example of walking the talk.
Eric Wahl, keynote speaker and renowned speed graffiti artist, mixed his unique art with a message to “unthink”. To meet the challenge and opportunity to the changes we face Wahl’s message was to “unthink” and ex-pand our consciousness. He suggested the need to think differently about strategies and solutions and look creatively. Creativity is in all of us and begins in our youth. He shared a Yale study that showed Crayola as one of the most recog-nized brands and that the smell of crayons has a calming, blood pressure reducing, effect. Everyone needs to embrace their creative forces forged from youth and use them to feel creative, innovative and not afraid of fear or failure and be willing to take a risk. Wahl emphasized to keep looking at new ways to brand yourself to be fresh as this will in turn garner market share. The risk of being too structured may provide a feeling of comfort but ultimately leads to stagnan-cy and complacency. According to Wahl, breaking outside the comfort zone is the key to keep thriving and growing. Check out the pictures on the back page where Wahl created amazing pictures of Lincoln and Einstein in a matter of minutes. Regarding Lincoln Wahl noted that sometimes “our greatest growth comes during chaos”. He even painted Einstein upside down to underscore imagination and inspiration and trying new approaches.
Another speaker, sales expert Ryan Estis, emphasized that to achieve success businesses must learn to provide value. He believes customers default to price in the absence of value and a quality experience. We are in or fast ap-proaching a phase of market disruption with the deluge of change noted above. Estis showed a number of well known company logos that were faced with market disruptions and are no longer in business as they did not plan for or ad-dress change. The key is to avoid disruption. Like Wahl, Estis advised that you can’t get stuck in the status quo or comfort zone. You need to strategize at your pinnacle to evolve with the changing times, new customers and different mindset. We are now in an era of the customer and Estis predicts there will be more changes in the next 3 years then there has been in the past 50 years. Estis believes you need to initiate continuous reinvention. You need to create breakthroughs – your biggest breakthrough is one step outside your comfort zone. Brand the customer experience with compelling differentiation that resonates with customers. Customer experience will be the primary basis for competition. Relationships foster finances and the human connection is the business we are in. We need to focus on how to be helpful and serve and decide how you show up (see the picture on the back page). How you show up resonates with customers. Also vital to success in the new era is a digital mindset. Communicating via blog-ging and texting is vital and waiting too long to get into the game could be fatal.
Amidst the speakers who addressed change and being creative and proactive in your evolution, ALTA em-phasized its theme of “The One thing” to temper the points. Being focused and narrowing the focus is a strategy for success. If your focus is too broad and you divvy up time and resources to multiple goals, your chances of success decline. If you focus on the “One” – one thing at a time – your chances of success increase. It’s an exer-cise in prioritizing so productivity wins out.
The classes and focus groups were plentiful. I attended a class on cyber fraud. While the stories seem to becoming repetitive they are real so they are worth noting and keeping an eye out for. Phishing email scams, so-cial engineering scams where you are tempted to open attachments or sites that lead to viruses and spy and mal-ware, and wire fraud are at the heart of cyber fraud. Companies need to have clear and certain wiring procedures that include confirmation from reliable sources. These issues are so prevalent that companies should review and consider coverage to protect against these frauds and crimes. One form of protection could be the creation of a document that all parties to a transaction would sign acknowledging the danger of electronic communications and potential fraud and identifying the specific confirmed processes for wiring funds and making changes.
I also attended the Federal & State Advocacy Meeting which was interesting in identifying the federal and state issues ALTA is following. Federal issues include GSE reform; tax reform to address the mortgage interest deduction, capital gains on sales of principal residences, corporate taxes, preservation of 1031 exchanges; and, reg-ulatory relief in improving CFPB and TRID requirements. State issues included the NAIC which has a cyber se-curity model law and continues to focus on consumer awareness including development of a title insurance basics course. Other State issues were flat recording fees; a model law for parameters on clearing title on foreclosed properties; and, a model law on remote e-notarizations. TIPAC was discussed and summed up that participation is needed and PAC funds need to grow if you want a seat at the table versus being an item on the menu.
Another class I attended was “How Does Your Business Measure Up”. This was an interesting presenta-tion on statistics and a summary of what companies across the nation are measuring. 50% of companies are track-ing labor costs on a wage or wage plus benefits basis. Turn time is being tracked by a number of companies with the average of 3-5 days turn time for a commitment to be issued from order entry. 40% of companies track total title insurance orders and closings each month as a way to measure one time period against another. This translat-ed into another stat of order and closing counts per full time employee during each period. 7-10 full time employ-ees per 100 closings was the average. 40% measure gross revenue per full time employee. 45% track marketing per sales expenses as a percent of revenue. Others even measure the percent of their staff by generations.
The average was 28% millenials, 38% generation X, and 28% baby boomers. Metrics is definitely on the mind of many companies across the nation.
New ALTA President, Daniel Mennenoh from Galena Illinois indicated his ALTA 2017 strategic priori-ties included Best Practices, communicating with homebuyers, core industry values, information security, talent focus and business basics, and TRID.
To wrap up please note the next ALTA One is in Miami, Florida at the Trump National Doral October 10-13, 2017. Attendance at the ALTA One (or our regional Pacific NW Convention August 17-19 in Suncadia, Washington) is a unique experience and opportunity to be inspired and informed in such a significant way. Chances of returning will increase, as might the chances of being involved. As JT noted in his address our ILTA One Thing is to get Involved.
Matt Ryden, Judiciary Chair
Please take note of the following recent Idaho Supreme Court decisions concern-ing conveyances and rights to real property. If there is a common theme, it would be: treat homemade legal de-scriptions and easement language with great skepticism.
Benton Trust v. McCarty, Opinion No. 2016-131 (November 16, 2016)
In this case, an insufficient legal description in a quitclaim deed from a trust, followed by an amendment of the trust before the legal description was corrected, resulted in an invalid conveyance of title.
Facts: On July 1, 2010, David and Marvel Benton, as trustees of their family trust, executed a Quitclaim Deed in favor of Dorothy McCarty, as grantee. The deed contained a “homemade” legal description, describing the property generally by its address, “known as” building name and parking lots.
On November 1, 2010, the Benton’s amended the Trust agreement, replacing themselves as trustees with their children as “Co-Trustees.” The amendment gave the Co-Trustees exclusive authority to bind the trust.
On April 24, 2012, McCarty attempted to record the Quitclaim Deed, but the deed was rejected by the county recorder for its inadequate legal description.
On May 4, 2012, McCarty recorded a Revised Quitclaim Deed, which this time included a proper metes-and-bounds legal description. This revised deed was signed by David and Marvel Benton, but not the new Co-Trustees.
Lawsuit: On April 9, 2013, the Co-Trustees initiated an action on behalf of the Trust to quiet title to the proper-ty and recover rents collected by McCarty since July 1, 2010. The Co-Trustees prevailed at the district court level, where the court found that: 1) the Quitclaim Deed was void because of its insufficient legal description; and 2) the Revised Quitclaim Deed did not revive the original deed because, at the time of its execution, David and Marvel Benton lacked authority to make any conveyance on behalf of the Trust.
Supreme Court Opinion: The Idaho Supreme Court upheld the lower court’s decision and awarded the Co-Trustees their costs on appeal.
The Supreme Court rejected McCarty’s argument that Idaho Code § 55-606 barred the Trust’s endeavor to invali-date its own Quitclaim Deed. Idaho Code § 55-606 provides that “every conveyance of an estate in real property is conclusive against the grantor [and those claiming under the grantor],” except as to good faith purchasers who record first. The court found the recording statute inapplicable because the Quitclaim Deed was void for its lack of a complete legal description. As a result, no legally enforceable “conveyance” occurred which would bar the Trust’s quiet title action against the purported grantee.
McCarty’s reliance on the Revised Quitclaim Deed was similarly unconvincing. McCarty contended the correc-tions made by the original trustees via the Revised Quitclaim Deed were enforceable under the legal doctrines of “reformation, interlineation and correction deed,” but presented no specific legal authority to support these argu-ments. The court ruled that since the Quitclaim Deed was void, the Revised Quitclaim Deed could not have effect as a corrective instrument. Additionally, David and Marvel Benton lacked authority to convey Trust prop-
erty when they executed the Revised Quitclaim Deed. As such, the two instruments could not – independently or together – constitute a valid conveyance of the subject property.
A pair of easement cases are also worthy of note.
In Kirk v. Wescott, Opinion No. 2016-96 (September 12, 2016), the court interpreted an express easement con-tained in a Warranty Deed. The Sellers sold a lot and granted the buyers a temporary access easement across an-other lot they kept. Subsequent purchasers of the lot burdened by the easement prevailed in a quiet title action to eliminate the easement. The granting language was confusing for its inclusion of various contingencies for com-mencement and termination of the easement. Fortunately, the dominant parcel had an alternate means of legal access.
In Spectra Site Communications v. Lawrence, Opinion No. 2016-85 (July 27, 2016), the court upheld the low-er court’s recognition of an implied easement by prior use, as to the use of access roads to communications tower sites. A party asserting an implied easement by prior use must prove:
1) unity of title and subsequent sepa-ration by grant of the dominant estate;
2) apparent continuous use long enough prior to separation to show the use was intended to be permanent; and
3) reasonable necessity of the easement for proper enjoyment of the dom-inant estate. The court relied on actual use, and references to the access roads in past leases and sales agreements, to find the intention of permanence. The court also emphasized that that “strict necessity” is not necessary to satisfy the reasonable necessity element when evaluating implied easements by prior use.
2016 Idaho Primary Election Report
Martin Bilbao, Gallatin PA
After a long and very difficult campaign cycle it is nice to finally call it complete. Though there were many surprises with the national races, the Idaho elections ended up about where most expected them to be. The only statewide elections were for a vacancy in the Supreme Court and a proposed amendment to the Constitution to grant the Idaho Legislature the authority to approve agency rules. Current Senator Curt McKenzie from Caldwell lost to magic valley lawyer Robyn Brody for the Supreme Court and the amendment passed.
Similar to the national trend, Republicans picked up a few more seats in the Idaho State Legislature. The Senate split will now be 29-6 Republican to Democrat and the House will now be 59 to 11.
The most significant defeat came in District 6 where six term representative, John Rusche, was beat by Mike Kingsley. Rep. Rusche was the House Minority Leader which will cause major changes within minority lead-ership.
Some of the key races where the incumbents prevailed include:
· Rep. Caroline Nilsson Troy, Republican from District 5
· Sen. Fred Martin, Republican from District 15
· Rep. Lynn Luker, Republican from District 15
· Rep. Patrick McDonald, Republican from District 15
· Rep. Steve Miller, Republican from District 15
Due to challenges from the Primary Election and open seats we will have many new legislators for the next legislative session. Following is a list of those who are new:
· Paul Amador, Republican from District 4
· Dan Foreman, Republican from District 5
· Thyra Stevenson, Republican from District 6 (Thyra previously served in the legislature)
· Mike Kingsley, Republican from District 6
· Carl Crabtree, Republican from District 7
· Priscilla Giddings, Republican from District 7
· Scott Syme, Republican from District 11
· Jeff Agenbroad, Republican from District 13
· Christy Zito, Republican from District 23
· Megan Blanksma, Republican from District 23
· Sally Toone, Democrat from District 26
· Randy Armstrong, Republican from District 28
· Mark Nye, Democrat from District 29 (Mark moved from the House to the Senate)
· Dustin Manwaring, Republican from District 29
· Bryan Zollinger, Republican from District 33
· Karey Hanks, Republican from District 35
With these changes will come a shift in committee leadership and assignments. We will know the final line up after the Organizational Session on December 1.