Privacy rights
Californians can rightfully boast of the protections accorded their privacy rights under state law. From the California constitution (which, unlike the U.S. Constitution, explicitly recognizes a right of privacy), to the extensive exceptions to public record access laws that prevent the disclosure of personal information, to the broad prohibitions against non-consensual recording of telephone conversations, the State of California has a well-deserved reputation as a vanguard in the protection of personal privacy rights. It appears, however, that a new law going into effect at the end of 2014 will erode these rights in the real estate arena.
Protecting Californians’ privacy rights
A popular tactic in protecting Californians’ privacy rights could be observed in the practice of documenting real estate transactions to prevent disclosure of the purchase price. While real estate deeds (which are public in order to guarantee the transferability and insurability of real property rights) do not disclose the purchase price of the property, the amount of documentary transfer tax must be shown by the taxpayer on the face of the deed pursuant to California Revenue and Taxation Code Section 11932, and this figure could then be used by others to calculate the purchase price of the property. For decades, however, California taxpayers have been able to request that this tax be shown on a separate, unrecorded, paper attached to the deed, which thus prevented prying eyes from computing the purchase price.
This helpful tool for protecting privacy rights is about to be eliminated, however. With little fanfare, Governor Jerry Brown recently signed AB 1888, which requires that any document submitted for recording after December 31, 2014, that is subject to documentary transfer tax must display the tax due on the face of the document, without exception.
Professionals who assist their clients in their real estate transactions who have been used to being able to protect their clients’ privacy in this way should be aware of this change in the law and should make their clients aware of this law before year’s end.
A copy of AB 1888 can be found here.
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