ALTA Supports ULC’s Model Act for Discriminatory Covenants
July 18, 2023
ALTA endorsed and commended the Uniform Law Commission (ULC) for developing model legislation to address illegal discriminatory covenants recorded in the public records.
The ULC’s model act provides a mechanism for repudiation by homeowners of discriminatory covenants, while retaining the capability for universities and non-profits to study these historic records and their impact. Joining ALTA in support of the model act include Just Deeds, Mapping Prejudice, the Minnesota County Recorder’s Association, the Mortgage Bankers Association and the Property Records Industry Association.
Many unlawful covenants exist in old declarations of covenants, conditions and restrictions that affect many properties. Additionally, unlawful covenants can exist within instruments that also include enforceable covenants, conditions or restrictions (CC&Rs).
These factors presented drafting nuances the committee considered and addressed in the model legislation. This helps ensure the unintentional voiding of enforceable covenants, which could create title questions impacting the marketability of the property.
Under the model Uniform Unlawful Restrictions in Land Records Act, individuals who own property, including owners in common interest ownership properties, that is subject to a prohibited restriction are empowered to record an amendment to the governing instruments that removes the restriction. With an amendment to the land record, the historical land record is not altered. To remove an unlawful and unenforceable restriction under this act is to amend a record chain of title, not to disturb or destroy a historical record. The act also includes an optional form that may be used by most owners to remove an unlawful and unenforceable restriction by amendment in the land records.
“ALTA is strongly opposed to any form of housing discrimination and is committed to proactively working toward solutions that protect the property rights of all homebuyers,” said ALTA CEO Diane Tomb. “We commend the Uniform Law Commission for their leadership on this important topic. We endorse the model legislation and look forward to its adoption by the ULC, introduction in state legislatures and ultimate passage around the country.”
Prior to this, there was no model or uniform legislative approach for empowering people to address unlawful discriminatory covenants in land records pertaining to their property. State lawmakers have considered various legislative approaches to address illegal and unenforceable discriminatory covenants in public land records. Different approaches, such as expungement of entire records containing illegal covenants, threaten the chain of title and create gaps in land records that jeopardize consumer property rights and the ability to buy, sell or refinance property.
In the early part of the 20th century, discriminatory covenants barring the sale or lease of property based on race, ethnicity or religion were inserted in some property records as part of deeds, plats and CC&Rs. Two decades after the landmark U.S. Supreme Court case Shelley v Kraemer established racially restrictive covenants were unenforceable under the 14th Amendment, the federal Fair Housing Act of 1968 made discriminatory covenants illegal and unenforceable.
Previously, ALTA has endorsed federal legislation to fund the research and study of discriminatory covenants in land records.
Addressing Illegal Covenants in Historic Land Records
- ALTA developed a publication that details the various approaches to addressing discriminatory covenants in the public land records. The document also highlights the pros and cons of each method, which include notification, repudiation, modification and redaction.
Contact ALTA at 202-296-3671 or email@example.com.