Title Records and Property Transfer

Question 1

Nemo Dat

Answer 1

• can’t give what you don’t have (the actual Latin expression is much longer)
• foundational principle of property transfer
• additionally, unless there is some explicit limitation, one is presumed to transfer everything one has
• means receiver can’t get better title than the transferrer

Question 2

Exceptions to Nemo Dat

Answer 2

• good faith purchaser

- adverse possession

Question 3

Kunstsammlungen zu Weimar v. Elicofon

Answer 3

• illustrative nemo dat case
• paintings go missing from Schwarzburg Castle, where they were being kept safe from bombing at end of WWII -> Elicofon buys them from a serviceman in 1946
• can’t get title from a thief (paintings were stolen at the beginning of this chain) -> no title in thief means no title in seller-> means no title in Elicofon under nemo dat (seller couldn’t sell what he didn’t own)

Question 4

Good Faith Purchaser for Value

Answer 4

• Purchaser for value = someone who gives consideration for the property (not through gift or inheritance)
• good faith if no notice, actual or constructive, of a prior inconsistent interest
• means that some people who don’t have good title can wind up giving good title to someone else as long as they purchase it in good faith

Question 5

Void vs. Voidable

Answer 5

• person w/ voidable title can give good title to GFPV, but person with void title CAN’T
• thief has void title (NO ability to transfer to GFPV), vs. fraudster has voidable title

Question 6

Kotis v. Nowlin Jewelry, Inc. - Facts

Answer 6

• Sitton obtained gold ladies Rolex watch from Nowlin Jewelry in return for forged check for $9,438.50 -> contacts Kotis next day + sells it to him for $3550
• Kotis contacts Nowlin - he argues by this point he’d already bought the watch, but on the phone he asked for the payment info, + when he called back Kotis said he wasn’t interested in the watch, didn’t have it, and wouldn’t tell her how much Sitton was asking for it (supports notion of bad faith)
• Nowlin finds out the check was a forgery + sitton indicted

Question 7

Kotis v. Nowlin Jewelry - Procedural Posture

Answer 7

• Nowlin and Kotis involved in suit to determine ownership of the watch -> trial court finds no good faith

Question 8

Kotis v. Nowlin Jewelry Inc - Decision + Reasoning

Answer 8

• court acknowledges that Sitton had voidable title (could’ve successfully given title to GFPV)
• BUT says no good faith in Kotis - used-car dealer (should’ve been more aware of GFPV issues) + knew price was unreasonably low, plus his behavior on the phone

Question 9

Hauck v. Crawford - Facts

Answer 9

• Farmer Hauck brings quiet title action to set aside mineral deed - alleged fraud in the execution by Crawford + two other men
• Crawford + assoc. presents Hauck w/ deed - he has 8th grade education + there’s lots of fine print involved, + Hauck says he thought he was signing a mineral lease (Crawford admits no mention was made of a mineral deed)
• deed purported to convey half the minerals to Crawford, who then grants to White and Duncan

Question 10

Hauck v. Crawford - Procedural Posture

Answer 10

• trial court made no finding about White’s + Duncan’s knowledge + assumed they were bona fide purchasers
• found void title in Crawford b/c fraud in the execution
• defs deny the fraud + assert that the GFPVs should prevail even if fraud

Question 11

Hauck v. Crawford - Decision + Reasoning

Answer 11

• court affirms that Hauck wins over Crawford -> says fraud in the factum leads to void title, although owner negligence can raise an estoppel (in present case, not litigated b/c either way Crawford loses, but might give win to the “GFPVs” who purchased from Crawford)
• so, the negligence doesn’t impact whether or not the title is void (it’s definitely void) but even if it is void, the GFPVs might be able to claim estoppel (owner should bear the brunt of the negligence)

Question 12

Hoffer v. Crawford

Answer 12

• another case - says most fraud leads to voidable title (for void title, fraud should be clear + not result of owner negligence)

Question 13

UCC and Fraud

Answer 13

• fraud generally leads to voidable title under the UCC

Question 14

Registration

Answer 14

• land records typically arranged by parcel + land office inspects each document to be filed + guarantees validity of the titles
• typically in civil law countries

Question 15

Recordation

Answer 15

• recording systems - records relating to title (deeds, mortgages, etc.) are filed in an office + indexed by grantor + grantee
• most land in US uses this system
• no certification of title by public authorities - the records office just acts as a repository of organized records

Question 16

Registration vs. Recordation

Answer 16

• registration has higher start-up costs + requires better-trained personnel
• but, registration provides more definitive answer to ownership questions + avoids more errors

Question 17

Notice Statutes and GFPVs

Answer 17

• nemo dat gets overriden by GFPVs under notice statutes - as long as the purchasers have no notice, the last GFPV wins

Question 18

Notice Statute

Answer 18

• type of recording act
• subsequent purchaser for value wins unless he/she has notice (actual or constructive, including record or inquiry)
• any recorded interest gives constructive notice -> incentive to record immediately to protect purchase against GFPVs (as long as you record, your title is safe)

Question 19

Constructive Notice

Answer 19

• can find out if someone has recorded their deed

- can also find out through inquiry (going to look at the property)

Question 20

Awareness for Purposes of GFPV

Answer 20

• awareness is evaluated at the time of purchase - if you find out later, you’re still good

Question 21

Chain of Title and Notice

Answer 21

• if a deed can’t be found in the chain of title (isn’t linked up b/c a prior person didn’t record), the deed doesn’t give notice and GFPV isn’t expected to find it
• so, even if you record, you may lose to a subsequent GFPV under notice statute if your title doesn’t line up (if the grantor before you never recorded)

Question 22

Shelter Rule

Answer 22

• A transfers to B, then A transfers to C and C, who was without notice, transfer to D – even if D knew about the A to B transfer, D beats out B because C would win against B
• Idea that D should be able to shelter under C’s rights – once C beats B under the recording act, C can transfer to anyone (otherwise would be difficult for C to find a new buyer if wanted to sell)
• Exception to this rule: C couldn’t transfer back to A, the original grantor – don’t want to encourage collusion

Question 23

Adverse Possession and Recording Acts

Answer 23

• search of legal records not likely to give notice of adverse possessors
• adverse possessors win, even if their titles aren’t recorded

Question 24

Adverse Possession and Nemo Dat

Answer 24

• adverse possession starts new root of title, but, similar to nemo dat, you can only adverse possess as much as the original owner has (if they have a life estate, you’d probably get a life estate)

Question 25

Mugaas v. Smith - Facts

Answer 25

• Mugaas brings action to quiet title on a strip of land + compel neighbor Smith to remove any encroachments

Question 26

Mugaas v. Smith - Procedural Posture

Answer 26

• trial court found that adverse possession in Mugaas’ favor had been established by 1910, but her fence rotted away in 1928 -> Smiths then bought their property in 1941, w/ pre-AP boundary in their deed + no notice through the fence

Question 27

Mugaas v. Smith - Decision + Reasoning

Answer 27

• court says Mugaas wins b/c she got ownership through AP -> once she has ownership, she is only required to behave as an owner would (owner wouldn’t lose possession simply because fence rotted away)