Titles - Competing Claims to Title Flashcards
Are recording statutes generally applicable to judgment liens? For instance, can lenders be considered BFPs
NO (to both questions).
Lender’s interest arises from judgment lien, not payment of valuable consideration.
To prevail under a notice act, a party must be a bona fide purchaser (“BFP”) who recorded their deed without notice of earlier purchasers. To be a BFP, a party must give value for their interest in the land. In this case, the lender’s interest arises from a judgment lien against the owner rather than payment of valuable consideration. Therefore, the lender is not protected by the recording statute.
A wants title to go to A and B, so she has her brother pretend to be B at the closing and sign for B. They didn’t know it, but B had been dead for a while. So who owns the land?
A owns half and the original owner owns half. Can’t convey title to a dead person, and though A acted fraudulent as to B’s conveyance, her conveyance was legit so she got good title to half and the rest goes back to the owner.
If received property as a gift and then properly recorded, and in a race-notice state, does the recording statute protect you?
No, because must be a BFP to get protection of a recording statute.
What is the first in time, right in right rule?
Under the common law, if a grantor transfers the same piece of property to multiple grantees, the first grantee to receive the deed acquires rightful title. In the absence of a recording statute, the common law rule controls.
There are three types of notice:
Actual
Constructive
Inquiry
Actual Notice.
A subsequent purchaser has actual notice when he has personal knowledge of a prior interest.
Constructive Notice.
A subsequent purchaser is on constructive notice when the prior interest is recorded (i.e., validly recording a deed by publicly registering it automatically puts the entire public on notice).
What is a wild deed? What is its effect?
If a deed is not recorded properly, it is considered a wild deed.
A wild deed does NOT put subsequent purchasers on constructive notice.
Inquiry Notice.
A subsequent purchaser has inquiry notice when a reasonable investigation would have revealed the existence of prior claims (e.g., someone is clearly living on the property in question).
Race Statutes.
The first grantee to record acquires title, regardless of notice.
Notice Statutes.
A subsequent purchaser acquires title if the purchase is made
WITHOUT notice of a prior unrecorded conveyance.
Race-Notice Statutes.
A subsequent purchaser acquires title if:
- The purchase is made WITHOUT notice of a prior unrecorded conveyance;
AND
- The subsequent purchaser records first.
What is the Shelter Rule?
A person who is transferred property from a bona fide purchaser (BFP) has the same recording statute protections as the BFP (i.e., the transferee “takes shelter” in the status of the BFP transferor).
What if a bona fide purchaser?
A BFP is a person who pays valuable consideration (i.e., not an heir, devisee, or donee) for real property without notice of a prior interest.
