LRB-2273/1
JJL:skg:ks
1995 - 1996 LEGISLATURE
May 24, 1995 - Introduced by Representatives Kaufert, Green, Goetsch,
Kreibich, Ott, Hahn, Gunderson, Kelso, Vrakas, Seratti and Grothman,
cosponsored by Senators Petak, Fitzgerald and Panzer. Referred to
Committee on Financial Institutions.
AB397,1,2
1An Act to amend 708.01; and
to create 708.11 of the statutes;
relating to:
2assignments of rents and leases.
Analysis by the Legislative Reference Bureau
This bill identifies when an assignment of rents becomes effective (an
assignment is a transfer of the right to receive rental payments from the assignor,
the person transferring the right, to another). Under the bill, an assignment is
effective as to the assignor when the signed assignment is delivered to the assignee.
The assignment is effective as to all others when it is recorded in the office of the
register of deeds.
The bill also specifies that the assignee may enforce the assignment and
ensures that a person who makes a rental payment to an assignee receives credit for
that payment.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB397, s. 1
3Section
1. 708.01 of the statutes is amended to read:
AB397,1,7
4708.01 Effect of mortgage. A mortgage on real property creates a lien on the
5property mortgaged; except for the lien
and subject to s. 708.11, the mortgagor
6retains the interest that the mortgagor had at the time of mortgage until that
7interest is divested by some later act.
AB397, s. 2
8Section
2. 708.11 of the statutes is created to read:
AB397,2,4
1708.11 Assignments of rents and leases. (1) In this section, "assignment"
2means any assignment, pledge, transfer or any other conveyance of an interest in
3rents or leases, or both, whether contained in a mortgage, security agreement or
4other document executed by the assignor.
AB397,2,14
5(2) When any debt or other obligation is secured by an assignment, the
6assignment shall be effective as to the assignor upon the execution and delivery of
7the assignment to the assignee. The assignment shall be perfected as to all
8subsequent purchasers, mortgagees, lien creditors, and all other 3rd parties for all
9purposes from the time and date of recording the assignment in the register of deeds
10office of the county in which the real property affected by the assignment is located.
11The assignment shall be governed by ch. 706 and shall be considered a conveyance
12for the purposes of ch. 706. An assignee who enforces an assignment in accordance
13with its terms shall not be considered to be a mortgagee in possession with attendant
14liability.
AB397,2,16
15(3) (a) Unless otherwise agreed upon in writing, the assignee shall be entitled
16to enforce the assignment without the necessity of any of the following:
AB397,2,1717
1. Furnishing notice to the assignor or any lessee.
AB397,2,1818
2. Obtaining possession of the real property.
AB397,2,1919
3. Impounding the rents.
AB397,2,2020
4. Securing the appointment of a receiver.
AB397,2,2121
5. Taking any other affirmative action.
AB397,2,2422
(b) Enforcement of the assignment shall not be considered a cure of an event
23of default notwithstanding the collection of rents in excess of any delinquent
24amounts due the assignee.
AB397,3,5
1(4) Any tenant or lessee who, upon notice from an assignee, makes rent
2payments to the assignee in accordance with the terms of the assignment shall be
3given credit for the payment as if the payment had been made to the assignor, but
4nothing in this section shall affect the other rights and obligations of the assignor or
5the tenant or lessee as to one another.
AB397,3,8
7(1) This act first applies to assignments in effect or entered into on the effective
8date of this subsection.
