1. Certificate of Title Act for Vessels Committee
Although approximately two-thirds of the states and territories have a certificate of title law for boats and other vessels, they differ widely in scope in two discrete ways. First, they do not all cover the same types of vessels, each making its own distinctions based on size and propulsion. Second, the statutes vary in whether they are based on where the vessel is principally used, where it is principally moored, or where the owner resides. Consequently, significant gaps and some duplication in coverage exist. The gaps allow for extensive fraud: title to a stolen vessel can be washed by moving the vessel to a new jurisdiction that either has no titling law or has a law that does not cover the vessel at issue.
Moreover, several other problems plague the existing titling laws for vessels:
1. They were all written before the revision of Article 9 of the Uniform Commercial Code, thereby creating problems with sales of vessels and security interests in vessels.
2. None of the existing laws has been approved by the U.S. Coast Guard which means the vessels are not accorded the status of a preferred ship mortgage under federal law.
3. Very few state title laws for vessels provide for the branding of the title of a damaged or salvaged vessel.
Alabama does not have a Certificate of Title for Vessels Act.
The Uniform Certificate of Title for Vessels Act addresses all of these problems. In general, the act covers all vessels of at least 16 feet in length and all vessels propelled by an engine of at least 10 horsepower. Exceptions exist for seaplanes, amphibious vehicles for which a certificate of title is issued pursuant to a motor vehicle titling act, watercraft that operate only on a permanently fixed, manufactured course, certain houseboats, lifeboats used on another vessel, and watercraft owned by the United States, a state, or a foreign government.
The act applies if the vessel is used principally on the waters of the state. An owner must, within 20 days of becoming an owner or within 20 days of the date the vessel becomes used principally on the waters of the state, apply for a certificate of title. However, no application is required for a federally documented vessel, a foreign documented vessel, a barge, a vessel under construction, or a vessel owned by a dealer.
Like a motor vehicle title, an application must include information about the owner or owners, the vessel, and any secured parties. The application must be accompanied by documentary evidence showing the applicant to be an owner of the vessel. The titling office will maintain its records so that searches about vessels can be conducted by the vessel’s hull identification number, by the vessel number, or by the owner’s name.
The act includes a branding requirement. Thus, if the vessel’s hull has been damaged by a casualty event, the owner or insurer must, prior to selling the vessel, either note this on the certificate or apply for a new certificate that indicates that the vessel is “hull damaged.” Failure to comply with this rule renders the offender liable for a civil or administrative penalty.
2. Restrictive Covenants in Contracts Committee
A new committee was formed in 2012 to study the Alabama law concerning restrictive covenants. There is no Uniform Act for the committee to consider, therefore the committee decided to organize the review into four subcommittees. The areas of responsibility for each subcommittee are as follows:
Subcommittee # 1:
Reasonable Relationship of Restriction to Protectable Interest
Who can be the subject of an anti-competitive restriction (Business owners/sellers, employees, independent contractors, sales force, managers, franchisees, etc)
Subcommittee # 2:
Reasonable Temporal Restrictions
Reasonable Geographic Restrictions
Meaning of “Total” Restraints
Meaning of “Partial” Restraints
Advisability of Maintaining the Total/Partial Restraint Taxonomy
Subcommittee # 3:
Judicial Reformation of Covenants
Interpretation of Covenants (Greater definition of the meaning of “narrowly construed”)
Burden of Proof
Choice of Law
Contract Validity and Formation
Each subcommittee will present their findings and suggestions to the entire committee. It is anticipated that the review will take two years.
3. Family Law Standing Committee
In 2013, the Family Law Standing Committee was formed to begin a systematic review of family law. At the initial meeting, the committee formulated and prioritized a list of issues to be considered.
Three bills will be presented to the Legislature during the 2015 Regular Session. They are a new Grandparent Visitation, a Deployed Parents Custody and Visitation Act and the Division of Retirement Benefits Upon Divorce Act. Final Committee Report
The committee is currently drafting a new alimony statute. The committee is also studying several other potential family law areas for future revision including custody, parenting plans, common law marriage and gestational agreements.
7. Right of Publicity Study Committee
The Right of Publicity can be defined as the right to control the commercial use of one’s identity. The right of publicity evolved from the general principles of invasion of privacy that prohibit using a person’s name or likeness to gain a benefit. The elements typically comprising the Right of Publicity are referred to as the name, image and likeness of every person. The Right of Publicity presumes that everyone, regardless of fame, has a right to prevent unauthorized use of their name or image to sell products. This right has also been held to prohibit any implication that a person endorses a product (without the person’s permission).
A number of states recognize the Right of Publicity via statute, for example, California, Florida, Indiana, Illinois, Kentucky, New York, Nebraska, Ohio, Oklahoma, Tennessee, Texas, Utah, and Virginia). The Law Institute has formed a committee to consider developing a statutory Right of Publicity law.
8. Uniform Asset-Preservation Orders Act
The Uniform Asset-Preservation Orders Act (UAFOA) creates a uniform process for the issuance of asset-preservation orders, freezing the assets of a defendant, and imposing collateral restraint on nonparties, such as the defendant’s bank, in order to preserve assets from dissipation, pending judgment.
The viability of asset-preservation orders became a concern after the decision of the United States Supreme Court in Grupo Mexicano de Dessarolo v. Alliance Bond Fund, Inc., 527 U.S. 308 (1999). Although, the Grupo Mexicano decision involved the jurisdiction of the federal courts, it caused some confusion in the state court system over the propriety of asset-preservation orders. Subsequent to that decision, some state supreme courts have concluded that courts in their state lacked the authority to issue asset-preservation orders, while other courts have reached the opposite conclusion.
The UAPOA is designed to remedy this current lack of uniformity on the question of whether courts have the power to issue and recognize asset-preservation orders by providing states with a uniform act that authorizes the issuance of asset-preservation orders. It also provides for the recognition and enforcement of asset-preservation orders by other states and courts outside the United States.
An asset-preservation order is, by its very nature, an extraordinary remedy with potentially significant impact on the debtor whose assets are frozen and on third-parties holding those assets. Accordingly, the act provides rigorous standards which must be met before such an order can be issued. The UAPOA provides appropriate procedural safeguards to both debtors and non-parties, such as banks.
9. Standing Trust Committee
In 2012, the Law Institute created a Standing Trust Committee to assist the Alabama Legislature in staying abreast of the evolving changes in the area of trust law. The first area addressed by the committee was the development of a unitrust law for Alabama. In 2013, the Legislature adopted a committee recommendation and enacted a bill that updated the Alabama Principal and Income Act to provide for the establishment of unitrusts in Alabama.
The committee is presenting to the Legislature for consideration during the 2015 session a statute that will invalidate certain aspects of trust agreements, such as beneficiary designations upon divorce. Final Committee Report
The committee is beginning a study on asset protection trusts. We anticipate this review will take several months to complete.
10. Nonprofit Corporation Act Committee
Alabama’s Model Nonprofit Act was adopted in 1984 and followed the 1964 Model Nonprofit Act drafted by the American Bar Association. Since that time, the Nonprofit Act has twice been revised by the A.B.A. with the third edition adopted in August, 2008.
The Institute committee was formed in 2007 to begin a review of the new act drafted by the American Bar Association. The Act is divided into 17 Chapters. The committee has reviewed the Act and made a number of changes to conform the Act to Alabama practices.
Subsequent to the passage of the Alabama Business and Nonprofit Entities Code in 2009, the committee has reviewed the Nonprofit Act in light of the need to make changes to incorporate the new Nonprofit Corporation Law into the Alabama Business and Nonprofit Entities Code. The committee is working to ensure that the changes in the Model Act recommended by the American Bar Association are compatible with Alabama’s new Alabama Business and Nonprofit Entities Code effective 2011. All revised entities will become a part of the Entities Code.
11. Business Entities Standing Committee
In 2012, the Institute formed a standing committee on Business Entities (Title 10A) to address issues related to the adoption and implementation of Title 10A and to discuss developing issues related to business entities as they arise. The initial concern for the committee was to review and update the Name Reservation provisions in light of new technology advances. A bill to amend the Business Entities Code on name reservations was passed by the Legislature in 2013.
In the 2014 session, the legislature passed amendments relating to Mergers and Conversions. Final Committee Report In the 2015 session, the committee will be submitting amendments to the LLC Act. Final Committee ReportThe committee’s current study is of the Model Business Corporation Act. It is anticipated that this study will take several years.
12. Criminal Code Committee
The Alabama Criminal Code became effective in 1980. Since that time there have been numerous amendments, additions, and changes. A new Criminal Code committee was formed in 2009.
The 1980 Criminal Code was compared with the current law showing line through and underlined changes during the past 30 years. The Committee is undertaking a systematic review of the entire criminal code, classification system and sentencing structure.
This review will be conducted with the goal of ensuring the criminal code is as effective and efficient as possible. The committee is reviewing the chapters one at a time. It is anticipated that this review will take several years to complete.
13. Real Estate Standby Committee
The Real Estate Standby Committee was formed to review various real estate acts for possible recommendation to the Alabama Legislature. There are several areas of real estate law that have been studied by the National Conference of Commissioners on Uniform State Laws. These studies have resulted in the recommendation of several acts. Among those recommended:
A. Uniform Conservation Easement Act
B. Ad Valorem Tax Sales
C. Uniform Real Property Electronic Recording Act
D. Rule Against Perpetuities
E. Amendments to the Alabama Condominium Act (review began 2010)
F. Uniform Residential Mortgage Satisfaction Act
G. Uniform Partition of Heirs Property Act
14. Uniform Interstate Family Support Act
The 2008 Uniform Interstate Family Support Act (UIFSA) Amendments modify the current version of UIFSA’s international provisions to comport with the obligations of the United States under the 2000 Hague Convention on Maintenance.
UIFSA provides universal and uniform rules for the enforcement of family support orders by setting basic jurisdictional standards for state courts and by determining the basis for a state to exercise continuing exclusive jurisdiction over a child support proceeding. It establishes rules for determining which state issues the controlling order in the event of proceedings initiated in multiple jurisdictions. It further provides rules for modifying or refusing to modify another state’s child support order.
In July 2008, the Uniform Law Commission amended UIFSA to incorporate changes required by the Hague Convention on the International Recovery of Child Support and Other Forms of Family Maintenance. In order for the United States to fully accede to the Convention it was necessary to modify UIFSA by incorporating provisions of the Convention that impact existing state law. Section 7 of the 2008 UIFSA provides for the guidelines and procedures for the registration recognition enforcement and modification of foreign support orders from countries that are parties to the Convention. Enactment of the amendment to UIFSA will improve the enforcement of American child support orders abroad and will assist many children residing in the United States in their efforts to receive the financial support due from parents, wherever the parents reside.
Legislation before Congress to ratify the Convention provides that the new amendments of UIFSA must be enacted in every jurisdiction within two years after the enactment of federal implementing legislation as a condition for continued receipt of federal funds for state child support programs. If that legislation is enacted as presented, the failure to enact these amendment by that date will result in the loss of significant federal funding. The committee is watching Congress closely for any action to ratify the convention.
15. Condominium Act Committee
Alabama’s Condominium Act was passed in 1990 and is located in Chapter 8A of Title 35 of the Code of Alabama. During the past 21 years several issues have been raised needing clarification. Listed below is a summary of the issues addressed by the amendments.
1. Section 35-8A-102(c) was amended to clarify when an offering statement is required for sales of units in condominiums located outside of Alabama which are sold to Alabama residents.
2. The amendment to § 35-8A-103(4) recognizes that easements and other interests in real property can be a common element.
3. The amendment to § 35-8A-103(11) identifies the development right to convert common elements to units when reserved in the declaration.
4. The amendment to § 35-8A-105(c) recognizes that some property subject to development rights can not be separately assessed and taxed.
5. The amendment to § 35-8A-107(c) requires that any portion of an award attributable to condemnation of limited common elements be divided among the owners in accordance with the value of the interest in a particular limited common element assigned to the units rather than requiring the amounts to be equally divided among the unit owners.
6. Section 35-8A-201(b) was amended to delete the requirement of maintenance of a condominium book by the judge of probate in each Alabama county.
7. Section 35-8A-201(c) was amended to clarify that a declaration or an amendment to the declaration is not effective until there is substantial completion of the structural and mechanical systems in the buildings located on the property being submitted to the condominium form of ownership. The amendment to § 35-8A-210(c) also removes the requirement that the engineer or architect certify that the structural and mechanical systems of all buildings were "completed in accordance with the plans."
8. Section 35-8A-208(a) was amended to require the association's consent for limited common element reallocations.
9. The amendments to § 35-8A-209(b) were substantially revised to require all information to be included on the plat to the extent such information could be shown on a two dimensional page, showing the subdivision of land and reciprocal rights relating to the subdivision.
10. The amendments to § 35-8A-209(d) eliminate the requirement of showing development rights to subdivide if such rights are described in the declaration.
11. Section 35-8A-(209)(g) was amended to allow a licensed surveyor to provide the required certification. This change expands the prior law which provided that only a licensed engineer or architect could certify to a plat.