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H0226...........................................................by BUSINESS
LIMITED LIABILITY COMPANIES - Amends and adds to existing law to provide
the statutory form of notary acknowledgment for limited liability
companies.
02/12 House intro - 1st rdg - to printing
02/15 Rpt prt - to Bus
02/24 Rpt out - rec d/p - to 2nd rdg
02/25 2nd rdg - to 3rd rdg
02/26 3rd rdg - PASSED - 62-0-8
AYES -- Alltus, Barraclough, Barrett, Bell, Bieter, Black, Bruneel,
Callister, Campbell, Chase, Clark, Crow, Cuddy, Deal, Denney,
Ellsworth, Field(13), Field(20), Gagner, Geddes, Hadley, Hammond,
Hansen(23), Henbest, Hornbeck, Jaquet, Jones, Judd, Kempton, Kendell,
Kunz, Lake, Limbaugh, Linford, Loertscher, Mader, Marley, McKague,
Meyer, Montgomery, Mortensen, Moyle, Pischner, Pomeroy, Reynolds,
Ridinger, Ringo, Robison, Sali, Schaefer, Sellman, Smith, Smylie,
Stevenson, Stone, Taylor(Taylor), Tilman, Tippets, Watson, Wheeler,
Williams, Zimmermann
NAYS -- None
Absent and excused -- Boe, Gould, Hansen(29), Kellogg, Stoicheff,
Trail, Wood, Mr Speaker
Floor Sponsor - Black
Title apvd - to Senate
03/01 Senate intro - 1st rdg - to Com/HuRes
03/10 Rpt out - rec d/p - to 2nd rdg
03/11 2nd rdg - to 3rd rdg
03/15 3rd rdg - PASSED - 34-0-1
AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Geddes,
Hawkins, Ingram, Ipsen, Keough, King, Lee, McLaughlin, Noh,
Richardson, Riggs, Risch, Sandy, Schroeder, Sorensen, Stegner,
Stennett, Thorne, Twiggs, Wheeler, Whitworth
NAYS--None
Absent and excused--Parry
Floor Sponsor - Davis
Title apvd - to House
03/16 To enrol
03/17 Rpt enrol - Sp signed - Pres signed
03/18 To Governor
03/23 Governor signed
Session Law Chapter 213
Effective: 07/01/99
H0226|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature First Regular Session - 1999IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 226 BY BUSINESS COMMITTEE 1 AN ACT 2 RELATING TO FORMS OF ACKNOWLEDGMENT; AMENDING SECTION 55-707, IDAHO CODE, TO 3 PROVIDE REQUISITES FOR ACKNOWLEDGMENT OF INSTRUMENTS EXECUTED BY A LIMITED 4 LIABILITY COMPANY AND TO MAKE TECHNICAL CORRECTIONS; AMENDING CHAPTER 7, 5 TITLE 55, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 55-707A, IDAHO 6 CODE, TO PROVIDE REQUISITES FOR ACKNOWLEDGMENT OF INSTRUMENTS EXECUTED ON 7 BEHALF OF AN ENTITY BY ANOTHER ENTITY ACTING THROUGH ITS AUTHORIZED REPRE- 8 SENTATIVE; AMENDING CHAPTER 7, TITLE 55, IDAHO CODE, BY THE ADDITION OF A 9 NEW SECTION 55-711A, IDAHO CODE, TO PROVIDE A FORM OF CERTIFICATE OF 10 ACKNOWLEDGMENT FOR LIMITED LIABILITY COMPANIES; AMENDING SECTION 55-805, 11 IDAHO CODE, TO SPECIFY THE ACKNOWLEDGMENT NECESSARY TO AUTHORIZE RECORDING 12 OF AN INSTRUMENT EXECUTED BY A LIMITED LIABILITY COMPANY AND TO MAKE TECH- 13 NICAL CORRECTIONS; PROVIDING AN EFFECTIVE DATE AND PROVIDING FOR APPLICA- 14 TION OF THE ACT. 15 Be It Enacted by the Legislature of the State of Idaho: 16 SECTION 1. That Section 55-707, Idaho Code, be, and the same is hereby 17 amended to read as follows: 18 55-707. REQUISITES OF ACKNOWLEDGMENT. The acknowledgment of an instrument 19 must not be taken, unless the officer taking it knows, or has satisfactory 20 evidence from a credible source, that the person making such acknowledgment is 21 the individual who is described in, and who executed, the instrument; or, if 22 executed by a corporation, that the person making such acknowledgment is the 23 president orvice-presidentvice president or secre- 24 tary or assistant secretary of such corporation; or other person who executed 25 on its behalf; or if executed in the name of the state of Idaho or that of any 26 county, political subdivision, municipal or quasi-municipal or public corpora- 27 tion, that the person making such acknowledgment is one (1) of 28 its officers executing the same; or if executed in a partnership name, that 29 the person making the acknowledgment is the partner or one (1) of 30 the partners subscribing the partnership name to such instrument ; or, if 31 executed by a limited liability company, that the person making such acknowl- 32 edgment is a manager or member of such limited liability company or other per- 33 son who executed on its behalf . 34 SECTION 2. That Chapter 7, Title 55, Idaho Code, be, and the same is 35 hereby amended by the addition thereto of a NEW SECTION , to be 36 known and designated as Section 55-707A, Idaho Code, and to read as follows: 37 55-707A. ACKNOWLEDGMENT BY ENTITY ON BEHALF OF ANOTHER ENTITY. (1) As 38 used in this section: 39 (a) A corporation, partnership, limited liability company, trust or other 40 legal entity which is the party executing an instrument and the party, or 41 one (1) of the parties, to be bound thereby shall be referred to as the 2 1 "maker" of the instrument; 2 (b) A corporation, partnership, limited liability company, trust or other 3 legal entity which is a partner, manager, member, trustee or other autho- 4 rized representative of the maker shall be referred to as the "constituent 5 entity" of the maker; 6 (c) The natural person who signs the written instrument as an officer, 7 partner, manager, member, trustee or other authorized representative of 8 the constituent entity shall be referred to as the "signer"; and 9 (d) An acknowledgment of an instrument executed by a maker acting through 10 a constituent entity shall be referred to as a "compound acknowledgment." 11 (2) A compound acknowledgment of an instrument shall be made in a form 12 which substantially conforms to the statutory form of acknowledgment for an 13 entity of the same legal form as either the maker or the constituent entity; 14 provided however, that any acknowledgment which satisfies the requirements of 15 subsection (3) of this section shall suffice. 16 (3) A compound acknowledgment shall: 17 (a) Identify the signer; 18 (b) State the signer's official title, capacity or authority to sign on 19 behalf of the constituent entity, or recite that the signer is authorized 20 to sign on behalf of the constituent entity; 21 (c) Identify the constituent entity or constituent entities; 22 (d) Recite the constituent entity's official title, capacity or authority 23 to act on behalf of the maker, or the relationship of the constituent 24 entity to the maker, or the position the constituent entity holds in or 25 with the maker, or that the constituent entity is authorized to act on 26 behalf of the maker; and 27 (e) Identify the maker. 28 (4) As an example only, a compound acknowledgment for a maker which is a 29 partnership, acting through a constituent entity which is a corporation, may 30 take the following form: 31 STATE OF .......... ) 32 ) ss. 33 COUNTY OF .......... ) 34 On this ..... day of ........, ...., before me, 35 ............................., a Notary Public in and for said State, person- 36 ally appeared .....(signer)....., known or identified to me (or proved to me 37 on the oath of ..........) to be the .......(officer title)....... of 38 .......(constituent entity)....... a ..................... corporation, one of 39 the partners in the partnership of .......(maker)......., a 40 ......................... partnership, and the partner or one of the partners 41 who subscribed said partnership name to the foregoing instrument, and acknowl- 42 edged to me that he executed the within instrument on behalf of said corpora- 43 tion, and that such corporation executed the same in said partnership name. 44 IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official 45 seal the day and year in this certificate first above written. 46 ................................... 47 Notary Public for ................. 3 1 Residing at ....................... 2 My commission expires ............. 3 SECTION 3. That Chapter 7, Title 55, Idaho Code, be, and the same is 4 hereby amended by the addition thereto of a NEW SECTION , to be 5 known an designated as Section 55-711A, Idaho Code, and to read as follows: 6 55-711A. FORM OF CERTIFICATE -- ACKNOWLEDGMENT BY LIMITED LIABILITY COM- 7 PANY. The certificate of acknowledgment of an instrument executed by a limited 8 liability company must be substantially in the following form: 9 State of Idaho, county of .............., ss. 10 On this ......... day of ................., in the year ...., before me 11 (here insert the name and quality of the officer), personally appeared 12 ..........., known or identified to me (or proved to me on the oath of 13 .............), to be the manager or a member of the limited liability company 14 that executed the instrument or the person who executed the instrument on 15 behalf of said limited liability company and acknowledged to me that such lim- 16 ited liability company executed the same. 17 SECTION 4. That Section 55-805, Idaho Code, be, and the same is hereby 18 amended to read as follows: 19 55-805. ACKNOWLEDGMENT NECESSARY TO AUTHORIZE RECORDING. Before an 20 instrument may be recorded, unless it is otherwise expressly provided, its 21 execution must be acknowledged by the person executing it, or if executed by a 22 corporation, by its president orvice-presidentvice presi- 23 dent , or secretary or assistant secretary, or other person executing 24 the same on behalf of the corporation, or if executed in the name 25 of the state of Idaho or any county, political subdivision, municipal, quasi- 26 municipal, or public corporation, by one (1) or more of the officers of such 27 state, county, political subdivision, municipal, quasi-municipal, or public 28 corporation executing the same, or if executed in a partnership name, by one 29 (1) or more of the partners who subscribed the partnership name thereto, 30 or if executed by a limited liability company, by the manager, member or other 31 person executing the same on behalf of the limited liability company, 32 or the execution must be proved and the acknowledgment or proof, certified in 33 substantially the manner prescribed by chapter 7 , 34of thistitle 55, Idaho Code ; provided, that if such 35 instrument shall have been executed and acknowledged in any other state or 36 territory of the United States, or in any foreign country, according to the 37 laws of the state, territory or country wherein such acknowledgment was taken, 38 the same shall be entitled to record, and a certificate of acknowledgment 39 indorsed upon or attached to any such instrument purporting to have been made 40 in any such state, territory or foreign country, shall be prima facie suffi- 41 cient to entitle the same to such record. 42 SECTION 5. This act shall be in full force and effect on and after July 43 1, 1999. Nothing in this act shall be construed to apply to or invalidate any 44 acknowledgments made prior to such effective date, or to apply to or invali- 45 date the recordation or attempted recordation of any instrument acknowledged 46 prior to such effective date, whether such attempt or recordation occurred or 47 occurs before or after such effective date.
STATEMENT OF PURPOSE
RS08904
The purpose of this legislation is to create a statutory form
for notary acknowledgments of documents executed by limited
liability companies. Idaho has statutory forms of
acknowledgment which notaries public are required to use when
taking acknowledgments of instruments executed by
corporations, partnerships, trusts and governmental entities,
but there is no statute providing a form of acknowledgment for
limited liability companies. Limited liability companies have
been authorized under Idaho law since 1993. Notaries public
have presumably been adapting the forms of acknowledgment used
for corporations or partnerships when dealing with limited
liability companies; limited liability companies need a
statutory form of acknowledgment of their own.
This legislation also clarifies the requirements for a notary
acknowledgment when there are two or more legal entities in
the chain of authority from the human being signing the
document, to the legal entity who is actually being bound by
the document. For example, many documents are signed by a
person acting as president of a corporation, and the
corporation is acting as general partner in a partnership, and
it is the partnership which is the party bound by the
document. Under current law notaries have no guidance
regarding how to take an acknowledgment of such an instrument.
This legislation would provide such guidance.
FISCAL NOTE
This bill will have no impact on the general fund.
Contaot: Patrick V. Collins (208) 344-6000
Hawley Troxell Ennis & Hawley LLP
Counsel for Idaho Bankers Association
STATEMENT OF PURPOSE/FISCAL NOTE H 226