The Recording System Flashcards
Notice statute
At common law, when a grantor conveyed the same land to multiple grantees, priority went to the earlier grantee. Modern recording acts can protect later grantees by changing the common law “first in time, first in right” rule. Under a notice statute, a subsequent bona fide purchaser prevails over a prior grantee who fails to record, regardless of whether the BFP records. A BFP is a purchaser who takes for valuable consideration and without notice of a prior claim at the time of the conveyance. Actual notice is what the purchaser actually knows. Record notice is notice that the law imputes to the purchaser if a prior deed was properly recorded in the grantee’s chain of title. Inquiry notice is notice of what the purchaser would have discovered by inquiring into the property. Inquiry notice imputes would would have been disclosed by inquiring of one in possession. Subsequent purchasers are not protected by the recording acts against, and thus take subject to, interests that arise by operation of law (e.g., title by adverse possession). A subsequent purchaser will not be charged with record notice of “wild deeds,” which are recorded such that a searcher could not feasibly find them. A title search in a tract index would reveal all recorded interests relating to the land. In a grantor-grantee index jurisdiction, a title search would reveal all recorded interests to and from a grantor.
Race-notice statute
Under a race-notice statute, a subsequent bona fide purchaser (i.e., one who take for value and without notice) is protected only if she records before the prior grantee. Notice is measured at the time of the conveyance, not at the time of recording.
No conveyance or mortgage of an interest in land is valid against any subsequent purchaser for value without notice thereof whose conveyance is first recorded.
Race notice statute
Shelter rule
Under the shelter rule, a person who takes from a BFP will prevail against any interest that the BFP would have prevailed against. The shelter rule applies even if the transferee had actual knowledge of the prior interest.
