HB2443 HD2 HSCR694-02

 

STAND. COM. REP. NO.694-02

Honolulu, Hawaii

, 2002

RE: H.B. No. 2443

H.D. 2

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Judiciary and Hawaiian Affairs, to which was referred H.B. No. 2443, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE PREVENTION OF THE FILING OF FRIVOLOUS FINANCING STATEMENTS,"

begs leave to report as follows:

The purpose of this bill is to remedy the filing of frivolous financing statements with the Bureau of Conveyances (Bureau) by assuring that the filing of the financing statements are authorized by the debtors.

The Department of the Attorney General (AG) and the Department of Land and Natural Resources testified in support of this measure.

Currently, the Bureau cannot recognize and remedy the filing of frivolous financing statements because, among other things, Act 241, Session Laws of Hawaii 2000, deleted the requirement for the debtor's signature. Frivolous and invalid filings affecting the property interests of members of the public are a serious problem. Your Committee finds that this measure provides a mechanism to remedy filings that are not authorized by security agreements.

Your Committee has amended this bill for the purpose of clarifying the intent of this measure by:

(1) Clarifying that the public is in need of a mechanism to address the filing of frivolous financing statements;

(2) Clarifying that the purpose of this bill is to remedy the current situation of filing frivolous financing statements;

(3) Allowing any party in interest in fixtures or personal property which is covered by a financing statement, who believes the filing of the financing statement was unauthorized, to file a request with the registrar to determine if the filing was authorized by a security agreement;

(4) Stipulating that failure to provide a security agreement covering a transaction authorizes the filing of a notice of unauthorized filing of a financing statement; and

(5) Making technical, nonsubstantive amendments for clarity, consistency, and style.

As affirmed by the record of votes of the members of your Committee on Judiciary and Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2443, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 2443, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Judiciary and Hawaiian Affairs,

 

		____________________________ ERIC G. HAMAKAWA, Chair