Recording system

Question 1

recording system

Answer 1

BFP, forms of notice, recording statutes, discrete chain of title problems

Question 2

recording system

BFP

Answer 2

A bona fide purchase (BFP) is one who:

1. Buys Blackacre for value AND
2. w/o notice that someone else got there first

Question 3

recording system

BFP - 2 bright line rules

Answer 3

In a double-dealer situation,

1. If B is a BFP and we are in a NOTICE jdx, B wins regardless of whether or not she records before A does.
2. If B is a BFP and we are in a race-notice jdx, B wins IF she records properly before A does.

Question 4

recording system

BFP - value

Answer 4

If BFP pays below FMV, BFP still takes for value as long is she remits substantial pecuniary consideration for value.

Question 5

recording system

BFP - doomed donee

Answer 5

If B is O’s heir, devisee, or donee, in a recording statute question, B LOSES unless the shelter rule applies.

Question 6

recording system

forms of notice

Answer 6

The 3 forms of notice that a buyer may potentially be charged are AIR:
Actual
Inquiry
Record
Inquiry and record notice are both forms of constructive notice and are imputed to B.

Question 7

recording system
forms of notice
actual

Answer 7

Actual notice: Prior to B’s closing, B learns of A.

Question 8

recording system
forms of notice
inquiry

Answer 8

inspection

reference to an unrecorded transaction

Question 9

recording system
forms of notice
inquiry
inspection

Answer 9

Whether he looks or not, B is on inquiry notice of whatever an inspection of Blackacre would show.
Buyer has a duty to inspect before transfer of title to see whether anyone else is in possession.
If another is in possession, B has inquiry notice regardless of whether buyer actually bothered to inspect.
Lack of inspection can defeat BFP status.

Question 10

recording system
forms of notice
inquiry
reference to an unrecorded transaction

Answer 10

If a recorded instrument makes reference to an unrecorded transaction, grantee is on inquiry notice of whatever a reasonable follow up would show.

Question 11

recording system
forms of notice
record

Answer 11

B is on record notice of A’s deed if at the time B takes, A’s deed was recorded properly.

Question 12

recording system
forms of notice
record
win depends on recording statute

Answer 12

If B is a BFP and A has not recorded, win depends on the recording statute.

1. If we are in a NOTICE jdx, B wins regardless of whether or not B records before A does.
2. If we are in a race-notice jdx, B wins IF B records properly before A does.

Question 13

recording system

recording statutes

Answer 13

Notice statute, Race-notice statute

Question 14

recording system
recording statutes
notice statute

Answer 14

“A conveyance of an interest in land shall not be valid against any subsequent purchaser for value, without notice thereof, UNLESS THE CONVEYANCE IS RECORDED.”
If, at the time B takes, B is a BFP, B wins.
Last BFP to enter wins.

Question 15

recording system
recording statutes
Race-notice statute

Answer 15

“A conveyance of an interest in land shall not be valid against any subsequent purchaser for value, without notice thereof, WHOSE CONVEYANCE IS FIRST RECORDED.”

To prevail, B must 1) be a BFP and 2) B must have recorded first (won the race to record).

Question 16

recording system
recording statutes
A’s proper recordation

Answer 16

If A promptly and properly records before B takes, A puts later buyers on record notice and thereby defeats their status as BFP.

Question 17

recording system
recording statutes
proper recordation

Answer 17

To give record notice to subsequent takers, the deed must be recorded properly within the chain of title.
Chain of title refers to the sequence of recorded documents capable of giving record notice to later takers.
In most states, the chain of title is established through a title search of grantor/grantee index.

Question 18

recording system

discrete chain of title problems

Answer 18

shelter rule
wild deed
estoppel by deed

Question 19

recording system

discrete chain of title problems - shelter rule

Answer 19

One who takes from a BFP will prevail against any entity that the transferor-BFP would have prevailed against.
IOTW, the transferee takes shelter in the status of her transferor, and she steps into the shoes of the BFP even though she otherwise fails to meet the requirements for BFP status.

Question 20

recording system
discrete chain of title problems
aim of the shelter rule

Answer 20

Shelter rule aims to protect B, a BFP, by making it easier to B to transfer successfully w/o the burdens of O’s double dealers.

Question 21

recording system
discrete chain of title problems
wild deed

Answer 21

O sells to A, who does not record. Then A sells to B, and B records the A-to-B deed.
The A-to-B deed, although recorded, is not CONNECTED to the chain of title b/c the O-to-A link is missing from the record.
The A-to-B deed is a wild deed

Question 22

recording system
discrete chain of title problems
rule of the wild deed

Answer 22

If a deed entered on the records has a grantor unconnected to the chain of title, the deed is a wild deed. It is INCAPABLE of giving record notice of its existence.
Recording a wild deed is a nullity, an outlier.

Question 23

recording system
discrete chain of title problems
estoppel by deed

Answer 23

One who conveys realty in which he has no interest is estopped from denying the validity of that conveyance if the deed purported to convey a particular estate.