5409.17,20 Page 1 of 18 FSH 5409.17 - RIGHTS-OF-WAY ACQUISITION HANDBOOK WO AMENDMENT 5409.17-91-1 EFFECTIVE 9/3/91 CHAPTER 20 - TITLE CLEARANCE AND APPROVAL 21 - TITLE EVIDENCE. Procurement of title evidence needed to determine sufficiency of the Government's title to the easement is the responsibility of the Forest Service. The Regional Attorney provides guidance in this activity. The primary reference publication is the most recent addition (1970) of "Standards for the Preparation of Title Evidence in Land Acquisitions by the United States," published by the Lands Division, Department of Justice, hereinafter referred to as "Standards." The Forest Service pays for title evidence from the same funds available for purchase of the easement. Always obtain title evidence for any easement acquisition in two stages. Obtain preliminary title information for tracts of land the easement is expected to cross as soon as you know the general location of the easement. Send the information for the tracts actually crossed with the executed easement and supplemental title evidence (sec. 21.2) to the Regional Attorney for preliminary review prior to recording the easement deed. After recording the deed, obtain final title evidence ensuring or guaranteeing (title insurance policies and title certificates) or showing the history and condition of (abstracts) the United States' title to the easement. Price arrangements with title companies and abstractors should cover both preliminary and final title evidence as a package but may be paid for separately. 21.1 - Types of Title Evidence. For the purpose of these instructions, title evidence means title insurance policies, certificates of title, and abstracts of title normally furnished by commercial title companies and abstractors and covering those aspects of title that are a matter of public record. It also includes record searches by Forest Service employees in certain special cases described in section 21.14. Requests for title evidence specify only those tracts or subdivisions that the right-of-way crosses. Obtain title evidence from title companies, abstractors, or attorneys approved by the Department of Justice, except as indicated in section 21.14. The form and contents of commercial title evidence must meet the requirements set forth in the Standards. The principal forms of title evidence discussed in this code are in the order of their desirability. 21.11 - Title Insurance. A policy of title insurance insures the United States against loss by reason of defects in the title and liens and encumbrances affecting title, subject to conditions and exceptions set forth in the policy. The conditions and general exceptions are standard for all policies obtained by the United States and are printed on forms provided by the title companies. Special exceptions peculiar to the locality and those relating solely to the property covered by the policy are typed in usually under schedule B. Obtain title insurance in the amount of the consideration (including value of reciprocal rights) paid for the easement or the maximum amount obtainable for the minimum premium, whichever is the greater. When the consideration paid for the easement is large, use the more liberal limits of liability set forth in the Standards. When the final evidence is to be a policy of title insurance, have the preliminary title evidence prepared in the form of a preliminary title report or binder that commits the title company to issue a title insurance policy in the approved form. 21.12 - Title Certificate. Title certificates are just as acceptable as title insurance policies, except that in issuing a certificate of title, the title company does not assume any responsibility for the legal capacity of the grantor to convey. When the grantor is a public body, corporation, trustee, or other personal representative, supplement the title certificate assembly with the information necessary to establish the signer's authority to sign for the principal. To avoid having to include proof of authority in the title assembly, obtain policies of title insurance where available rather than title certificates in acquisitions from public bodies, corporations, trustees, or other personal representatives. Liability limits are the same as for final title insurance. 21.13 - Abstracts of Title. Do not use abstracts when it is possible to obtain other forms of title evidence even in those cases where abstracts may be less costly. When using abstracts in acquisitions from public bodies, corporations, trustees, or other personal representatives, supplement the title assembly with the information called for in section 21.24. 21.14 - Other. Regional Attorneys approve easement cases under such title standards as they deem adequate to protect the interests of the United States. Under certain circumstances, a search of the records by Forest Service personnel trained and experienced in record search may be accepted by the Regional Attorney in lieu of title evidence obtained from approved title companies and abstractors. The Regional Forester may ask the Regional Attorney to approve title based on a search of the records by qualified and experienced Forest Service employees when all of the following circumstances are present: 1. The consideration is less than $1,000. A last-owner search as defined in the Standards is satisfactory evidence for title approval for easement acquisitions for these amounts. 2. Title companies do not operate or provide unsatisfactory service in the area where the property is located. 3. There are no approved abstractors or title attorneys operating in the area or their services are too slow, too costly, or unsatisfactory. Regional Foresters shall consult with the Regional Attorney to develop more specific guides for the use of record searches by Forest Service employees. In some cases there may be no alternative, except for the Office of the General Counsel attorneys to search the records. Do not use a combination of preliminary title evidence obtained from approved commercial sources and a check by Forest Service personnel of the records after recording of the easement. Instead, obtain final title evidence showing title vested in the United States from the commercial source. 21.15 - Period of Search. Minimum requirements for the period of search of the records covered by an abstract, title policy, or title certificate are set forth in the Standards. Limit requests for these documents to the minimum period of search. In some cases, this ensures a quicker response from the title company than if the company must search the period since inception of title. The Department of Justice authorized the use of last-owner searches for easements where the consideration is less than $1,000 if it is possible to delay or avoid inconvenience and save Federal monies, and if local practice, reliability, security, economy, efficiency, and speed mandate the acceptance of such title evidence. The authorization cautions that if the use of such title evidence would create a situation that might possibly defeat or adversely affect the Government's title or cause losses to the United States, it is necessary to obtain conventional types of title evidence. 21.2 - Supplemental Title Evidence. For the purpose of these instructions, supplemental title evidence includes only the certificate of use and consent; certificate of possession; and, when needed, proof of authority to execute the conveyance. The term supplemental title evidence does not include instruments curing title defects revealed by the primary title evidence or certificate of possession. Section 21.3 covers the means for curing title defects and the forms of instruments required. 21.21 - Certificate of Use and Consent. Use form FS-5400-27 to prepare certificates. Prepare a certificate of use and consent first on the basis of preliminary title evidence showing condition of fee owner's title. Submit it as part of the title assembly for preliminary title review before recording of the easement. Submit a second certificate executed after the date of recordings and based on final title evidence as part of the title assembly for final title approval (sec. 41). This certificate serves two purposes: 1. To certify that specified outstanding rights and encumbrances disclosed by the title evidence do not interfere with use of the easement for the purpose intended. List any outstanding rights and encumbrances revealed by the title evidence that do not interfere with use of the easement or encroach upon the right-of-way in the blank following the second paragraph of the certificate. List separately each outstanding right or encumbrance that can be administratively waived with a brief note explaining why it can be waived. Wording such as the following examples may be used: a. Exception No. in schedule B of the preliminary title certificate No. 416 - Powerline easement. Does not encroach on subject right-of-way. b. Special Exception No. in schedule B of the title insurance policy No. 135. Mineral rights outstanding in third parties. Little probability that the parties will exercise the rights. If the title evidence is in the form of an abstract or title report, provide a more detailed reference. Only those outstanding rights or encumbrances that do not affect or potentially affect the planned use can be administratively waived. Clear all other exceptions by a suitable document (sec. 21.3), or request a waiver from the title approving authority (sec. 21.4). 2. To certify that the conditions set forth in the easement conveyance have been considered and acquisition subject to them is acceptable to the Forest Service and is recommended. 21.22 - Certificate of Inspection and Possession. Use form FS- 5400-28 to prepare certificates. The inspection is for the purpose of identifying possible rights of possession or other interest in the land within the easement that are not of record. Make the initial inspection and prepare the certificate before beginning negotiations. Include the initial certificate in the preliminary title assembly (sec. 22.11). Make a second inspection and prepare a certificate immediately after recording of the easement deed. Include the second certificate in the final assembly when you submit the case for title approval (sec. 22.31). The possessory rights or other interests discovered by the inspection may be any of those described in sec. 21.3. List in the blanks in the certificate of inspection and possession only those occupancies that are not of record. Deal with those occupancies that are of record and revealed by the primary title evidence in the certificate of use and consent (sec. 21.21). Use the blank space provided after the second certificate to identify the possessory right or interest discovered and its owner followed by a reference to the curative document in the title assembly. Waive those that it is possible to waive administratively by a statement following its identification. The rules for administrative waiver are those given in section 21.14. The third certification covers the possibility of a lien resulting from materials furnished or work performed on land within the right-of-way. If you find evidence of work performed or materials furnished, a short statement of the facts in the blank provided usually provides a sufficient basis for a waiver by the title approving authority. Write "None" in spaces following the second and third certification when there are no exceptions. The certificate prepared for the preliminary title assembly need identify only the possessory rights or interests discovered. The administrative waiver statement, reference to curative documents, and other information must be complete in the second certificate, which is a part of the final assembly. 21.23 - Proof of Corporate Authority. In acquisitions from public bodies, corporations, trustees, or other personal representatives when the primary title evidence consists of a title certificate or abstract, supplement the title assembly with the following: 1. Sufficient portions of statute, charter, or other records to determine the power of the grantor to hold and convey real estate and the validity of such conveyances. 2. A certificate or statement from the proper State officer showing payment of any required franchise taxes and stating that the corporation is in good standing. 3. A certified copy of the resolution of the proper corporate body authorizing the official who signed the document to make the conveyance to the United States. Regional Foresters may supplement these instructions in consultation with the Regional Attorney, as may be required, to cover more specifically the requirements in each State and for particular corporations. Regional Attorneys may modify these requirements in cases for which they approve title because they have more intimate knowledge of the public bodies and corporations in their area. To eliminate the need for the additional information required when acquiring easements from public bodies, corporations, trustees, or other personal representatives, the primary title evidence should be in the form of title insurance policies (sec. 21.11). 21.3 - Curing Title Defects. In these instructions, the term title defects means any matter revealed by title evidence that affects title to the easement acquired by the United States. These may be matters of record revealed by the primary title evidence or matters not of record discovered by inspection of the right-of-way or inquiry as noted in the certificate of possession. Those matters of record it is possible to waive administratively are not included within the meaning of the term. The Regional Attorney advises as to the general rules to follow and decides if it is possible to waive specific defects and, if not, the curative action required. The Forest Service is responsibile for taking the necessary action to cure title defects, including the obtaining of curative instruments; for presenting the facts needed as a basis for waiving title defects and for originating requests for waivers; for paying the costs associated with obtaining curative action and instruments when fiscally proper; and for recording curative instruments when required. The division of responsibility between the Office of the Regional Attorney and the Forest Service in the matter of title defects requires a detailed understanding between the two, both as to procedures for handling title defects in general and the instructions related to specific kinds of title defects. The Regional Forester's Staff is responsible for working out these procedures with the Regional Attorney and for instructing the Forest Supervisor's Staff through manual supplements, correspondence, and training. Observe the following principles in developing Regional procedures so that title defects may be disposed of quickly and at the least cost: 1. Always keep in mind the possibility of waiving defects rather than taking curative action. To the maximum extent possible, define the line between waiver requests and curative action for particular kinds of defects in consultation with the Regional Attorney. There should be complete understanding and full use of requests for waiver rather than curative action. 2. When there is doubt as to whether curative action or a request for waiver is the correct solution in a particular case, resolve this question before undertaking expensive and time- consuming curative action. An exception would be simple curative action that requires little more time than preparation of a request for waiver. 3. When the situation indicates the need for curative action, begin such action as soon as you obtain the executed easement. However, do not delay submission of a case for preliminary review to wait for completion of curative action. It is only necessary that such action be complete before final review and title approval. 4. The Regional Forester and Regional Attorney may arrange for the Regional Forester's Staff to perform the preliminary review function. Under this arrangement, the Regional Attorney must study and advise on the action required for only the more complex and difficult defects. The Regional Attorney's advice may be sought and given informally (sec. 22.1). 5. Describe the factual basis required for action on waiver requests in instructions to the forests. 21.31 - Taxes. Under the Department of Justice waiver policy, current-year taxes are seldom a problem in easement acquisitions. When it is possible to expect a waiver under this policy, obtain an authorization from the grantor to withhold from the purchase price a sufficient amount to cover the actual or estimated taxes that are a lien, but not yet delinquent. The Regional Forester shall draft a suitable form of withholding authorization and publish it in a Regional supplement with instructions for its use. Ordinarily, it is necessary to clear delinquent taxes in one way or another. Withholding a sufficient amount from the purchase price to pay the delinquent taxes is one solution. This requires a withholding authorization from the grantor. If it is possible to persuade the grantor to pay the delinquent taxes, the title evidence may be amended to remove this objection; or evidence that taxes have been paid may be included in the title assembly. In some cases the taxing authority has been willing to take official action to ensure that any subsequent conveyance of the lands crossed by Forest Service easements, which lands the taxing authority may acquire through tax delinquency, shall be subject to such easement. The taxing authority can take this action with respect to an individual case or to all easement acquisitions by the Forest Service. This latter method is greatly preferable. Try to achieve a blanket insurance in any jurisdiction where it is common to encounter tax delinquency. It is necessary to know the tax situation relative to the land crossed by the easement at the time negotiations begin for the easement. If a withholding authorization is necessary, obtain it at this time and not after execution of the easement. Discovering if the grantor is willing to pay delinquent taxes should be a part of the negotiations. In some cases the defect resulting from unpaid taxes is not eligible for waiver under the rules of the Attorney General; nor is curative action possible due to unwillingness of the grantor or for other reasons. Rather than prepare the case for condemnation, request a waiver. Include with the waiver a statement of the facts regarding the tax situation and a statement of the attempts at curative action and their results. The Regional Attorney then decides whether to waive the defect or recommend condemnation. Handle State or Federal income tax liens as directed by the Regional Attorney. 21.32 - Mortgage Liens. Mortgage liens (deeds of trust, vendor liens) are a title defect for which the Attorney General has issued specific rules for waiver (sec. 21.42). Always request a waiver when the case qualifies under these rules. Where the conditions of the lien do not qualify it for waiver, the mortgage holder must release the easement area from the lien, or must subordinate the lien to the easement. Mortgage holders usually prefer a subordination agreement to a partial release because, if the easement is terminated, the mortgage lien is automatically reinstated over the area covered by the easement. If a partial release is used, the mortgage lien is permanently removed and cannot be reinstated, except by the execution of another instrument. The larger lending agencies, such as banks, insurance companies, and Government lending agencies, usually have their own forms and procedures for granting such releases or subordinations. They usually execute them when the request includes a copy of the easement conveyance and a plat of the right-of-way across the mortgaged property. Sometimes there is a charge for execution of a partial release or subordination. The Government may pay the fee for the release directly, or the landowner may be reimbursed for the cost as a relocation expense. 21.33 - Other Liens. The Attorney General has not issued waiver rules for liens other than tax and mortgage liens. However, when you find other liens, and the facts are similar to those that would result in a waiver of a mortgage lien, consult the Regional Attorney for a recommended course of action. 21.34 - Outstanding Rights. This group of title defects includes a wide variety of interests in the property crossed by the easement that are owned or held by parties other than the grantor. When these interests are administratively acceptable, they are not title defects and may be recommended for waiver. Some of the more common outstanding interests requiring curative action and their treatment are: 1. Possessory Interests of Tenants, Lessees, and Squatters. Leases and tenancy agreements may or may not be of record. They may not even be in writing. Inquiry or inspection of the property will reveal those that are not in writing or not recorded. Inspections may reveal squatters or others holding possession adverse to the Forest Service grantor. Whenever possible, obtain a disclaimer or waiver of interest from the party in possession. Develop forms for this purpose in consultation with the Regional Attorney; furnish the forests with such forms if the volume of work warrants. Otherwise, prepare a case specific instrument with the help of the Regional Attorney at the time of preliminary review. If it is not possible to obtain a disclaimer or waiver readily, request a waiver of the title defect. The request would include a statement of relevant facts concerning the possessory interest in relation to the easement and the attempted curative action. If possible, obtain a copy of the lease or other document under which the interest is held. 2. Easements. Occasionally the easement obtained by the Forest Service encroaches upon or crosses an easement owned by a third party. If the prior easement is for such a facility as a powerline, telephone line, or pipeline, it is usually possible to locate and construct the road in such a way as not to interfere with the facility. However, it is necessary to secure the consent of the owner of the prior easement before crossing or encroaching on the previously defined right-of-way. The consent must be in writing. It must be in recordable form, unless the evidence of third-party easement interest is not a recorded easement deed as is often the case with rural electric association powerlines. In such cases, a letter of consent or agreement that is not in recordable form is sufficient when it is included in the title assembly. The Regional Forester shall develop forms of consent with the help of the Regional Attorney and shall furnish the examples to the forests. A continuing need for consents from the same party may require agreement on a standard form of consent with that party. Frequently, the easement holder includes requirements for the design of the road where it crosses the right-of-way, such as minimum depth of fill across a pipeline, as a consent condition. Construction and use of a road across the prior right-of-way may require some change in the existing facility (new poles and raising the lines when crossing under a powerline or telephone line). The easement owner for utilities may condition the consent on the Government's agreeing to bear the cost of the alteration and usually insists that the easement owner do the work. Carefully draft the language concerning the arrangements for paying such costs so as not to violate fiscal or contracting limitations. Whenever possible, predetermine the cost of doing such work. The consent agreement should specify that this amount be paid to the easement owner when the described alteration is complete. Prior easements that are not definitely described (floating easements) and that have not yet been used for the purposes granted are a special problem. Normally, a definitely described easement acquired by the Government is superior to a prior floating easement whose location has not been fixed by construction or by use for the purpose granted within a reasonable time period. This is not always true, however, because of the lack of opportunity to locate the floating easement on a reasonable route, variation in State laws, and the language of the prior floating easement itself. See section 11.4 for railroad crossings. 3. Outstanding Timber Rights. Standing timber or the right to cut such timber may be owned by a party other than the owner of the fee who is granting the easement to the United States. In the absence of a specific conveyance of timber on the right- of-way, the United States does not obtain ownership of such timber, but it does obtain the right to cut the timber in construction of the road. When timber rights are outstanding, obtain a release from the owner of the timber rights if there is any timber on the right-of-way that must be cut in constructing the road. Obtain the release in recordable form and include it in the preliminary title assembly. The release should specifically authorize the cutting of the timber on the right-of-way and should specify the method of disposal. If the timber on the right-of-way has already been cut or there is no timber on the right-of-way, a release is not necessary. If the outstanding right is of record, note the facts in the certificate of use and consent. If it is not of record, cover it in a separate statement, included in the title assembly. If the Government is to acquire timber on the right-of-way, the owner of the timber rights may join in the conveyance with the fee owner. An alternative is for the fee owner to reacquire the timber on the right-of-way and convey the easement and timber to the United States. 4. Outstanding Mineral Rights. Generally, it is possible to waive outstanding mineral rights administratively (sec. 21.21). However, if the nature of the rights, the probability of their exercise, and the probable mining methods are such as to impose an important risk to the road, it is necessary to take some action to eliminate or minimize this risk. The nature of the curative action needed depends on so many variables that it is best to rely on Regional Attorney instructions for each case. 21.35 - Heirship and Probate Problems. Imperfections in title to the land crossed often result when title has passed by will or by descent. Sometimes it is not clear who must execute the easement. There are a great variety of title problems in this field resulting from variations of State laws and procedures. Generally, the Regional Attorney indicates the action required in the individual case after reviewing the preliminary title evidence and facts furnished by the forest. Regional Foresters should include instruction in the basics of applicable State law and procedures in this field in training sessions so the staff experts can understand the problems revealed by the preliminary title evidence and can follow the instructions of the Regional Attorney. Seek early diagnosis and follow with prompt action to carry out the recommended curative action. Often these actions are complex and time consuming. They are one of the principal reasons for obtaining preliminary title evidence immediately following selection of the route and the subdivision or tracts to be crossed. Often it is necessary to seek assistance by the landowner to resolve some problems or to complete some action before execution of an easement. For example, the administrator of an estate may need court authorization to convey an easement. In any event, it is necessary to pursue diligently every step in resolving this type of title problem. In spite of the best efforts of those concerned, it is not always possible to resolve some of these title problems without unreasonable costs in time and effort or unacceptable delays. After a reasonable effort to resolve such problem cases, process them for title approval accompanied by a request for waiver of the defect or submit them for condemnation. If it is not possible to determine the parties from whom to obtain a conveyance or if it is not possible to obtain a conveyance from the apparent owners, complete the acquisition by condemnation. On the other hand, if you have obtained a conveyance from the apparent owners, but their title is in question and cannot be completely cleared, a waiver request is appropriate. Accompany this request by a statement of the relevant facts and description of the efforts made to cure the defect. 21.4 - Waiver of Title Defects. The Attorney General has issued rules for waiving defects resulting from tax and mortgage liens in title to easements. The Regional Attorneys shall follow these rules in their title approval of easement acquisitions. See sections 21.41 and 21.42 for a discussion of these rules and the form to use in requesting waiver under these rules. There are no specific rules governing waiver of the large remaining body of title defects encountered in easement acquisition. This does not mean, however, that requests for waiver will not be granted in many cases when the nature of the defect and the facts are such that the risks of future problems or loss are minimal in relation to the Government's investment and costs of alternative action to clear the defect. Some of the factors the Regional Attorney must take into account when considering requests for waiver of title defects are: 1. Acquisition cost of the easement. 2. Cost in money and time to clear the title defect. 3. The extent of the action taken by the field to eliminate the title defects. 4. The nature and extent of the title defect and its effect on the validity of the title to the easement. 5. The possible consequences of failure to clear the defect and the probability of these consequences developing. Choosing among further efforts to eliminate the defect, request for waiver, or recommendation for condemnation requires a high order of teamwork by the Forest Service and the Regional Attorney. The Regional Attorney has ultimate responsibility for decisions on these matters. However, the Forest Service is responsible for supplying the title evidence and supporting data that enable the Regional Attorney to identify the nature of the defect; for taking or obtaining curative action where feasible; for supplying facts and, in some cases, judgments needed to back up a request for waiver; and for pushing for a solution to title problems so that it is possible to complete acquisitions on schedule. Except for certain liens for which the waiver rules are set out in sections 21.41 and 21.42, it is not possible to establish rules that indicate, except in the most general way, whether a particular title defect in a specific case will be waived. However, past experience indicates that in very few Forest Service easement cases is condemnation needed to clear title. The General Counsel is quite liberal in exercising its authority to approve the title to easements to be acquired by or on behalf of the United States. Submit doubtful cases for title approval accompanied by a request for waiver of the title defect rather than prepare the case for condemnation. The Regional Attorney approves title subject to the title defects, returns the case for further information or specified curative action, or suggests that you prepare the case for condemnation. When submitting a purchase case involving unresolved title defects for title approval, the title assembly must include the following in addition to the usual material: 1. A request for waiver of the defects. 2. When the title evidence consists of a preliminary title certificate or a preliminary title report, information from the title company as to what curative action or material the title company considers necessary in order to issue a certificate or policy finding valid title in the United States. 3. A statement regarding the curative data obtained and action taken or attempted to eliminate the title defect. This statement must explain the reasons why further curative action is not possible or practicable. 21.41 - Waiver of Tax Liens. The Attorney General has issued rules under which payment of current taxes that are a lien and that are due and payable may be waived. The rules applicable to easement acquisitions are: 1. When the Government is to pay all or a substantial portion of the consideration to the holder of a mortgage on the property affected by the easement, payment of current taxes or withholding to ensure such payment is not mandatory. 2. When the consideration is insufficient to pay current taxes, there is no need to make provision for payment of such taxes. 3. There is no need to make provision for payment of current taxes when the consideration to be paid for the easement is less than 50 percent of the reasonable value of the entire tract of land subject to the easement. The rules apply only to current taxes; not delinquent taxes. Regional Foresters shall supplement the Manual to clarify the term delinquent as it applies to the various States in the Region. The full text of the Attorney General rules is contained in a letter to the Department's General Counsel dated June 29, 1964, which is on file in Regional Offices and with the Regional Attorneys. Submit requests for waiver of current taxes in substantially the form of exhibit 01 at the end of this section. The B portion of exhibit 01 is for tax liens. For instructions concerning tax liens that the Department's General Counsel can not automatically waive under the above rules, see section 21.31. Do not request a waiver in a condemnation case. 21.41 - Exhibit 01 REQUEST FOR WAIVER OF LIEN IN ACQUISITION OF EASEMENT BY DIRECT PURCHASE It is requested that the following lien(s) be waived under the provisions of the letter from the Department of Justice dated June 29, 1964. A. Lien of (mortgage) (deed of trust) (vendor's lien) shown at (page of the abstract) (item of the certificate of policy). 1. The present amount of the lien is $ . 2. The reasonable value of the fee is $ . 3. The purchase price of the easement is $ . B. Lien of taxes for the current year 19 . (Indicate 1 or 2, or complete item 3) 1. For the reason that it is necessary to pay all or a substantial portion of the purchase price to the holder of a mortgage, deed of trust, or vendor's lien in order to obtain a release or subordination thereof. 2. The amount of the purchase price is insufficient to pay the lien of current years taxes. 3. (a) The reasonable value of the fee is $ . (b) The purchase price of the easement is $ . (c) (Complete (1) or (2) below) (1) The taxes are payable in installments that become delinquent on the following dates: 1st installment delinquent date . 2nd installment delinquent date . 3rd installment delinquent date . (2) Taxes are not payable in installments and do not become delinquent for the current year until . 21.42 - Waiver of Mortgage Liens. The Attorney General has authorized approval of title to easements subject to outstanding mortgages, deeds of trust, and vendor's liens when the following conditions exist: 1. The unpaid balance of the lien does not exceed 50 percent of the reasonable value of the mortgaged property. 2. The consideration the Government is to pay for the easement does not exceed 10 percent of the reasonable value of the mortgaged property. The request for waiver and supporting information should be in the form of exhibit 01 in section 21.41. The A section of the form is for mortgaged liens. Do not request a waiver in a condemnation case. 22 - TITLE APPROVAL. Final approval of title to easements can only occur after the executed conveyance is recorded and the title evidence is extended to show title to the easement vested in the United States subject to specified exceptions. However, the most expeditious title approval occurs when the executed conveyance and preliminary title evidence are reviewed before recording the conveyance. Review may be by the Regional Attorney or, in routine cases, by the Regional or forest staff in consultation with the Regional Attorney. 22.1 - Preliminary Review. The purposes of preliminary review of the executed easement and preliminary title evidence are to: 1. Check the contents and execution of the conveyance. 2. Determine the nature and extent of any title defects it is necessary to resolve before submitting the case for title approval. 3. Prepare instructions for curative action or for obtaining additional information needed for waiver requests if required. 4. Authorize recordation of the easement. Preliminary review involves both the Regional Office easement acquisition staff and the Regional Attorney. The Forest Supervisor submits the executed easement and preliminary title evidence to the Regional Forester. As a minimum, the Regional Forester's Staff checks the easement for accuracy of the description and administrative suitability of the covenants, provisions, reservations, and interests conveyed. The remaining elements of the review are legal in nature; depending upon the complexity of the case, the Regional Attorney or Forest Service personnel experienced in this work in close consultation with the Regional Attorney may review these elements. Regional Foresters shall develop procedures with the Regional Attorneys to promptly perform the preliminary review and issue instructions for completing the acquisition. Forest Service work, in addition to the administrative review, depends on the (1) experience and training of the Regional Office Staff, (2) complexity of individual cases, and (3) kind of preliminary title evidence obtained. Ideally, trained Forest Service Staff make the complete preliminary reviews on routine cases without referring them to the Regional Attorney. The Regional Lands Staff refer the more complex cases to the Regional Attorney for review and preparation of a preliminary title opinion or to obtain other formal instructions for completing the acquisition. When the evidence obtained consists of preliminary title certificates, preliminary title reports, or insurance binders rather than abstracts, the review is much simpler and generally Forest Service personnel can readily perform such reviews. 22.11 - Preliminary Title Assembly. Include the following items in all submissions for preliminary review: 1. Executed Easement or Option if Used. 2. Plat of Right-of-Way if Plat Is Not Part of Conveyance. Any separate plat should use the stationing, courses, distances, curve data, ties, and other information that appear in the written description so that it is possible to check the written description properly. 3. Preliminary Title Evidence. a. Primary. Preliminary title certificate, preliminary title report or binder, abstract, or record search information showing condition of title to lands crossed by the easement to be acquired (sec. 21.1). b. Supplemental. (1) Certificate of use and consent prepared as of or after the date of execution of the easement (sec. 21.21). (2) Certificate of inspection and possession prepared about the date of execution of the easement (sec. 21.22). (3) Showing of corporate authority if needed (sec. 21.23). If not yet available, this item may be omitted to avoid delaying the preliminary review, but submit it with the final title assembly. 4. Curative Documents. Include curative documents already obtained. Specify curative action already started or planned concerning other title defects. Indicate the tax and mortgage liens that are to be waived under the Attorney General's rules (sec. 21.4). Do not make the actual waiver request until after recordation of the easement and preparation of the final title assembly. 5. Other Information. Include any other information that would help the reviewer to determine the nature, extent, and seriousness of those title defects not easily eliminated by curative action or waived under the Attorney General's rules. Include questions on specific points whenever this would result in more responsive instructions from the reviewer. 22.12 - Instructions for Recording and Curative Action. Upon completion of preliminary review, return the title assembly to the Forest Supervisor along with instructions for completing the acquisition. The instructions should include specific direction to record the easement and instructions for curative action or preparation of requests for waiver of title defects. Include answers to questions in the submission from the forest. When the review reveals that the easement deed is unacceptable, the instructions shall direct that it be returned to the grantor. Specify in the review the reasons why it is not acceptable and suggest the action needed to secure an acceptable easement. When there is a formal review of the preliminary title assembly, the Regional Attorney usually writes a preliminary title opinion for the Regional Forester. Send the preliminary title opinion to the Forest Supervisor. Include any further instructions or interpretation of the opinion in the letter transmitting the opinion to the forest. When the preliminary review is by the Forest Service, the letter of instructions to the Forest Supervisor shall contain the information and direction that a preliminary title opinion would provide. 22.2 - Action by Forest Supervisor. Promptly upon return of the case after preliminary review, the Forest Supervisor shall carry out the instructions for completing the acquisition. 22.21 - Recording. In the absence of specific instructions to delay recording, record the easement immediately. Delay may allow additional taxes to become a lien or allow other actions to cloud or encumber title to the easement. An easement across land lying in more than one county must be recorded in every county involved. The Forest Service pays recording fees. 22.22 - Obtaining Final Title Evidence. Order final title evidence concurrently with recording the easement. Ask the title company to delay issuance of final title evidence until after recording of the curative instruments if not recorded with the deed. 22.23 - Waiver Request. Prepare requests for waiver of tax and mortgage liens under the Attorney General's rules (sec. 21.4) as soon as the easement is recorded. Follow the instructions received from the Regional Attorney and Regional Forester when preparing requests for waiver of other title defects and when obtaining the facts to substantiate the request. Ask advice promptly at any stage in the preparation of the final title assembly when there is doubt as to the next step or when the instructions received do not apply to the facts as they develop. 22.24 - Curative Action. Begin curative action on title defects immediately upon the execution of the easement. There is no need to delay until after the preliminary review. Permission to cross other easements, disclaimers from tenants or lessees, and mortgage subordinations when the facts do not support automatic waiver are examples of defects for which curative action may be started or completed before submission of the preliminary title assembly. Record curative instruments that are in recordable form prior to requesting final title evidence from the title company. This prevents the defects from appearing in schedule B of the final title certificates and insurance policies. 22.3 - Final Review and Title Approval. The Regional Forester's Staff shall review the final title assembly when it is received from the Forest Supervisor to ensure that it is complete and ready for review by the attorneys. A checklist and systematic procedure for conducting this review is essential. The Regional Forester shall then submit the case to the Regional Attorney for final title approval. 22.31 - Final Title Assembly. The final assembly consists of the following items: 1. Executed and recorded easement conveyance. 2. Final title evidence. a. Primary. Final title insurance policy, title certificate, title abstract, or record search showing record title to the easement in the United States. b. Supplemental. (1) Certificate of use and consent prepared after recording of the easement conveyance and reflecting the condition of the title revealed by the final title evidence (primary). (2) Certificate of inspection and possession prepared after recording of the easement conveyance. (3) Showing of corporate authority if needed (sec. 21.23). The same material included in the preliminary title assembly if available at that time may be used in the final. 3. Curative Documents. Include all documents and instruments that cure or partially cure title defects revealed by the final title evidence. Also include other information, in the form of signed statements or as part of the transmittal letter, that would help the attorneys to understand the nature of defects and the action taken to cure them. It is not necessary to include material on defects that appeared as exceptions in the preliminary title evidence but that have been remedied and that do not appear as exceptions in the final title certificate or insurance policy. 4. Waiver Requests. Include in the final title assembly formal waiver requests for tax and mortgage liens shown in the final title evidence that are to be waived under the Attorney General's rules. See section 21.4 for these rules and the form for waiver requests. Also include requests for waiver of title defects not coming under the Attorney General's rules and not removed by curative action or otherwise. Include the information suggested in the preliminary review or in later instructions from the Regional Attorney. 22.32 - Regional Attorney Approval. The Regional Attorney has authority to approve title to all easement. Scenic easements are covered by FSM 5440. The Regional Attorney may do one of the following: 1. Approve title. 2. Approve title conditionally. 3. Request further information concerning title defects or further attempts at curative action. 4. Return the case to the Regional Forester with a recommendation to prepare it for condemnation. The Regional Forester shall return the case file to the Forest Supervisor for either closing the case, or further action recommended by the Regional Attorney.