Press Release
From Oneida County Clerk Sandra DePerno
August 27, 2007
OPENING COMMENTS
While I was out of town on vacation this past week, the Observer-Dispatch has further questioned the propriety of some of my decisions on certain matters and today I wish to address some of these issues. No doubt, some of the editorials and stories have, essentially, challenged the integrity of my office and my decision making; however, I believe that if given a fair opportunity to address, more fully, the issues and questions that have surfaced as well as the facts and circumstances behind my decision making, that the voters and taxpayers of Oneida County will realize that I am looking after their best interests and, at the same time, properly abiding by the laws and rules that govern my office.
NEW YORK STATE LAW GOVERNS THE SCOPE, OBLIGATIONS AND DUTIES OF THE OFFICE
Certain aspects of New York’s Real Property Law describe, in detail, the various obligations and requirements which are statutorily imposed upon the County Clerks of New York State. Among others are Real Property Law Sections 315, 316, 317 and 319. In fact, the Real Property Law Section 290(4) defines the reference to “Recording Officer” as the “County Clerk”, except in a county having a Register – where it means the “Register of the County”; [see RPL Section 290(4)].
The function, role and scope of the County Clerk’s duties, generally speaking, as it relates to the land records, is to oversee, safeguard and keep appropriate files of recorded instruments in the office of the County Clerk so as to satisfy the essential requirements of Section 291 of the Real Property Law, a/k/a “The Recording Acts”. This key and critical aspect of the Real Property Law (RPL) deals with, among other things, the need to protect innocent real property purchasers from fraud and deceit by authenticating recorded instruments in such a way so as to give constructive notice of claimed interests in real property.
In short, the State Legislature has prescribed a method, known as the Recording Acts, to protect investors in real property, including Banks and other Mortgagees, (in addition to property owners), from chaos, fraud, etc. Essentially, priorities are established with the recording of documents so as to provide an orderly method of transfer and reliance upon well established rules of law that have historically worked since the earliest recording acts were instituted New York State, i.e., by the Laws of 1813, Chapter 97.
The present Recording Acts Statute (under RPL Section 291) has been successfully employed since its enactment in 1909 (pursuant to Chapter 52 of the Laws of 1909). Under the RPL, the terms “recording” or “recorded” are defined, in part, as follows: “Recording or recorded means the entry, at length, upon the pages of the proper books in a plain and legible handwriting, or in print or in symbols by drawing, or by photographic process, or by any combination…or by reproduction of instruments by microphotography or other photographic process…and…kept in appropriate files”; (emphasis added).
THE PROBLEM WITH DOCUMENTS ON THE WORLD WIDE WEB
Nowhere, under the RPL is there an obligation of the County Clerk to put the records on the World Wide Web for all of the world to see. The County Clerk’s Office has been recognized and established by statute to essentially oversee the proper protection and authenticity of the records, not to broadcast social security numbers and legal signatures around the globe. The incidence of Identity Theft in the United States is approximately 24,000 cases a day. From a practical standpoint, in a day and age in which we have seen the movie The Wizard of Oz receive a technicolor makeover from its original 1930’s edition, I ask you, “Does it make much sense to indiscriminately post and display all of the individual and unique signatures of our residents of Oneida County on the World Wide Web for some criminal opportunist, i.e., in Los Angeles or Paris, France - to sit back on a computer and “cut and paste” the signature(s) onto fraudulently created documents, or checks?” With today’s computer technology, signatures can be digitally enhanced, so that a fake McCoy can be made to look like a real McCoy. That is, apparently what former County Clerk Rick Allen wants, but I don’t believe that this is what the clear majority of the citizens of Oneida County want! Not only is this kind of activity foreseeable and possible, it has already been happening! As for social security numbers, once they fall into the wrong hands, it is well established that your financial security and investments are at risk – to no end.
RISK/BENEFIT ANALYSIS – THERE IS A COST INVOLVED
A simple risk-benefit analysis suggests that the posting of sensitive personal information online poses a very real threat to everyone and that such an “accommodation” is not worth it. However, if the demands of the consumer were strong and substantial enough in number so that what it would cost to redact the personal information, including signatures, could be paid for with the proceeds of those who were willing to pay for the information and service online, then, in such case, it would be worth doing. In fact, if such were the case, the job might have been done by now.
NO HUGE DEMAND FOR THE SPECIAL AND EXTRA ONLINE SERVICE
Unfortunately there is virtually no demand for the records being online - but for a few special interests; and the costs to purify the records for online consumption appears to far outweigh the benefits. Again, from a practical standpoint, I am not elected to run a “world wide county clerk’s office”; I oversee the Oneida County Clerk’s Office – and like so many things in life – there are limitations.
NO LEGISLATIVE REQUIREMENT; AND, TODAY TECHNOLOGY IS OUTRUNNING THE LAW
I view my role as that of a fiduciary, vested with the public trust – to safeguard their records; and, along that line, I have to defer to Albany and legislative sanction and approval before I act and deviate too far outside of the scope and role that the State Legislature has prescribed for my Office. Presently, as aforementioned, Section 291 of the RPL mandates record keeping take place in the County Clerk’s Office. As a matter of law, there is no requirement for online records. I believe that former Clerk Richard Allen, arbitrarily and capriciously, tried to be a trailblazer in the area of public records, but the fact of the matter is that the intelligence of many, many lawmakers in Albany - in the last 100 years - has not yet seen it necessary to prescribe a new or alternative method to the Recording Acts of 1909. I believe, as New York State Supreme Court Justice Robert Julian eloquently stated last year that what Rick Allen did was merely show that “technology has out-run the law”. Former County Clerk Rick Allen believed that it would be politically expedient for him to establish online records, but by doing so without redacting the personal information, he showed a reckless disregard of the public trust. Of all of the votes cast in the county clerk’s race last fall, Mr. Allen ended up with less than 10% of the vote. For an incumbent to have lost an election by such large numbers, as he did, is testimony that his headstrong view of online records was not in the best interest of the public. The public voice certainly spoke out in last year’s election for Oneida County Clerk.
POSSIBLE LIABILITY ISSUES FOR THE COUNTY
Another angle of the online records issue that concerns me is simply the fact that - if online records are not mandated by Albany – and they are not so mandated at this time - and, if it is foreseeable that some sort of Identity Theft might result by doing so, could I, or the county, not be deemed liable, under Section 52 of the County Law? That is, it is not out of the question that the county could be deemed liable under the same rules of law applicable to the state, for damage or injury, to a person or property, which has been sustained due to the torts of its officers, agents and employees. County Law Section 53(1) also suggests that the County could be on the hook and chargeable with negligence. For example, in a lawsuit known as Baccari v. DeSanti, [70 AD2d 198, 431 NYS2d 829 (2d Dept 1980)], it was held that the county clerk was chargeable with negligence when an independent contractor produced a permanent index that erroneously stated the whereabouts of a real property encumbrance. In the case, the Appellate Division pointed out that the county and the county clerk could not circumvent their statutory duties and responsibility by delegating their performance obligations to independent contractors, that the “misfeasance” - or improper doing of an act – was something that the County Government had to answer to. And, similar in kind to tort of “misfeasance” is the tort known as “malfeasance” – which is the doing of an act by a person who ought not do it at all. So, I say, if the voters voted me into office to protect their records from being susceptible to Identity Theft on the Web, and, if there is no State Law on the books that mandates that I post such records on the Web; and, if it is foreseeable that Identity Theft could and might happen if I did so, (and Maricopa County in Arizona is a case in point of that - in as much as they have been the #1 County in America with Identity Theft and were the first county in America with such online records), then, in such case, perhaps it is just pure luck that Rick Allen did not get the County of Oneida tangled up in a big fat law suit for malfeasance involving Identity Theft. As a further case in point, if it is foreseeable and understandable that it will not be a good idea to have the personal information online 10 or 15 years from now, (especially as computer “cut and paste” and digitizing techniques are enhanced), then, let me ask you, is it a good idea to be rushing out to the web, with online records today – if the signatures, etc. are still in tact? We are in the process of evaluating exactly what should be, and, what should not be online. Then we have to determine the cost to redact the information that should not be sent. Again, if the cost and expense of properly redacting the personal information does not out weigh the demand and/or willingness to pay for it, is the idea, then, not yet ripe for implementation at this point in time? That is, as an idea and concept, it certainly is deserving of study, but an idea that is not practicable, safe and cost-effective is not something that you rush forward to do. To do so without careful consideration of all of the ramifications, I believe, is unwise and not in the publics best interest. Alternatively, there is a more limited plan for the records going online, whereby a password or key number would be registered and paid for; and, we would want to be able to track that user’s use, so that, if someone experiences Identity Theft stemming from the land records, we could, via expert computer forensics, trace or track down the source of the criminal activity. But, no matter what plan is implemented, it comes at a cost; and, it comes right back to the question: “Is there sufficient demand out there to pay for these special services?”
ONLINE RECORDS IS A “VALUE PROPOSITION”
The model of online records is a “value proposition”, and, I believe it will happen at some point and be a good thing; however to rush into it without the necessary safeguards, would be foolish and irresponsible. I recall that some records of the Defense Department and some records of the Bank of America were broken into and compromised in the last couple years; and, this happened, I am sure, notwithstanding the best laid plans to prevent a hacker from gaining entry into their respective computer systems. Therefore, a more cautious and deliberate approach, I believe, is necessary.
Can some of the records and/or a special informational cover sheet with respect to a recorded document be put on line? Sure. Again, there is a cost involved. But it certainly can be done. Enough time and money can, indeed, serve to solve virtually any problem or challenge, the question always is, however, at what cost. How much do we want to spend, who is benefiting, and, when the dust settles, at the end of the day, was the public, as a whole, best served by the accomplishment of the desired goal…
These are the questions that need to be asked and addressed.
THE 2006 COUNTY CLERK RACE WAS, IN LARGE PART, ABOUT THESE ISSUES
Quite frankly, when the whole of the voting public of the County of Oneida voted me in as Oneida County Clerk last year – and voted Rick Allen out – at that point, I did not believe that I needed to do a smaller poll or survey, of a smaller voter pool. What better evidence do you have – in terms of a mandate from the people – on the issue of identity theft then the voice of the people that spoke last November? And, may I add again, that the State Legislature, which governs my job and role, certainly has not mandated that our Oneida County Records be broadcast around the world. I need to listen to the people – who elected me…and I need to listed to Albany, where my job function is defined by statute; I do not believe that I have to listen to the voice of a disgruntled former county clerk, namely Rick Allen, who, apparently, enjoys the role of a muckraker at this point in his life…
THE COUNTY CLERK’S OFFICE AND SERVING THE PUBLIC
The County Clerk’s Office is a public office with public records; and, it use to be the County Clerk, years ago, who would do the work of preparing the title searches with a certification as to ownership. Some of the very old abstracts of title, that have not been lost or destroyed, still evidence the Oneida County Clerk’s title certification in the abstract of title.
Under Article 12 of the Real Property Law, which was established in 1909 (the same time as the current Recording Acts were reenacted) a new system of land registration had been devised whereby the public could ascertain, by inspection of register, in whom title to a particular piece of property is vested. Under this Article, County Clerks of the State of New York, who acted as the registrar of title, were entitled to receive an additional compensation for services, for compiling and title searches and as “official examiners of title pursuant to this article” - as per section 376 of the Real Property Law. Said Section further provided that, “It shall be the duty of the local authorities who provide for county expenses, to provide such accommodations, help, safes, books, papers and for such other expenses as may properly be required by the registrar, (a/k/a County Clerk or the person in charge of recorded instruments affecting land title), in the conduct of his office. And, under the same Article, Real Property Law Section 380 provides, “…It shall be the duty of any public official forthwith, to certify the returns of any search upon the requisition of any official examiner of title and without charge or fees for the same…”
And, while the so-called “Torrens System” of recording and recovering documents – under Article 12 of the Real Property Law - was used primarily in New York City and some surrounding counties in the New York City area, the rational that the public had to pay for documents at the time of recording, but not at the time of recovery, has been prevalent in New York. The exception has been the compensation to take care of the research services, since the work involved in creating a title search is, as I understand it, very labor intensive - often tedious and time consuming - as tracing a chain of title through successive grantors, assignors, wills and estates, as well as judicial actions, etc. has to be exacting, accurate, and within a given time frame.
Ultimately, the party needing the title search is … a taxpayer. That very same taxpayer, has helped to pay for the Oneida County Office Building that the County Clerk’s records are kept in. That same taxpayer, pays for the recording of the documents at the time of closing, including Mortgage Tax of 1% on a loan; and, $4.00 for every thousand dollars of the sale price on a transfer; and, recording fees for virtually every document begin at $33.00, if it is a one page document – and the price goes up from there. In addition, the Equalization and Assessment Form, which, just a few years ago was free, now has a governmental price tag on it of $75.00 if residential property is involved; or, alternatively, if the land is vacant or commercial property the filing of this form (with a deed) costs an additional $165.00. These are all costs that parties involved in real estate transactions have to pay to the government.
The same parties to the real estate transaction usually have to pay a lawyer for services too; and, sometimes they have to pay for two lawyers, the lawyer representing them; and, the lawyer representing the bank.
Then, if a loan is involved, often the individual has to pay bank fees as well.
Now enter the title companies that have to charge enough to cover their bottom line. First, as I understand it, the larger Abstract Companies, such as Leatherstocking Abstract & Title Corp., Allied American Abstract Corp. and Advantage Abstract Co., among others, have most of their employees working elsewhere most of the time and not within the confines of the Oneida County Office Building. For example, Leatherstocking is based in the Mayro Building, Allied American is in the HSBC Bank Building; and, Advantage Abstract is based in the 258 Building. That is, while some of the corporate employees “hang their hat” in the county building - as research artists – the abstracts, or title searches, are typed and produced in private quarters where handsome rent, I understand, is paid. Most of the title companies do not even own an office copier in the county building – and we, that is the County, make money when they need copies on our machines – or print documents on our computers, etc.
What I am getting to is that certainly I could charge rent for the very small “sit-down” office space that they use, but, who is kidding who, those additional fees and charges, ultimately will be passed on to the consumer – and neither the State nor the County have ever mandated such fees. Rick Allen was the first Oneida County Clerk to initiate such fees in Oneida County’s history; and, as I understand it, as soon as he did, the abstract companies had to raise their prices.
Said another way, the abstract companies, ultimately, will not be paying the extra rents, rather, the taxpayers (who are in need of the product that the abstractors are producing) will pay – when they pick up the title search they ordered. But, what is ironic, the people, the taxpayers, have already paid for the public building, so now they are paying the county government a second time! Its tantamount to, or rather it is, in fact, a hidden form of double county taxation. The question is, “With all of the above fees listed above to consummate a real estate transaction in Oneida County, do we, as County Officials, really want to add to the taxation process? In other words, Rick Allen’s $30,000.00 in rent charges translates, by pure numbers, to the fact that about 400 title closings have to be performed by the title companies before they make even one penny. It does not take a rocket scientist to realize that Oneida County has a finite number of real estate closings in a year’s time; and, that, if the abstract companies have to do some 400 closings before they even make one penny in profit, then, that bill, or charge, will – inevitably- be passed on to the public. Again, until Rick Allen became the Clerk, for over two hundred years, the County of Oneida never charged theses fees against the title searchers operating in the County Court House or the Clerk’s Office. Rick Allen’s rent was just another form of hidden tax that the public pays for. I don’t know if it is a good thing for government, which is here to serve the public, to be in the business of raising fees on the property owners in this back-handed type of way. I looked at the issue, I looked at what Rick Allen did, and I sided with the history of every County Clerk before Rick Allen and eliminated these fees. In summary, let me put it this way… In Oneida County, every Oneida County resident owns and/or rents real property somewhere; and, the average real property transfer, or property flip, is under eight years. And, in as much as the County Building is paid for by the taxpayer – and - in as much as the land records are, indeed, public records, then, it seems to me that charging the title companies more rent for the county coffers is simply a hidden form of double taxation which is essentially being charged to the public in a backdoor sort of way - since the title companies will, inevitably and inexorably, be adding the costs of any county charges to the bottom line of their title search. With all the fees the State and the County have tacked on and jacked-up to the recording process in recent years, I took a stand where I could, in favor of the public, since its their public records and their public building – they have paid for it already! I suppose Rick Allen would want to bill the public for use of the public courtrooms – when needed too.
To me, his view does not make any sense. The last I checked, we are in the public service business, not the “gouge the public” business.
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