Transfer of Title By Deed; Recording

Question 1

In order to prevail over a prior grantee under a notice statute, when must a subsequent bona fide purchaser record?

Answer 1

A bona fide purchaser will prevail over a prior grantee under a notice statute without ever recording.

Question 2

A notice statute is a recording act that:

Answer 2

alters the common law rule of “first in time, first in right” to protect a subsequent bona fide purchaser (“BFP”)—i.e., one who gives valuable consideration and lacks notice of the prior conveyance.

Question 3

A subsequent purchaser is only protected by a notice statute if

Answer 3

he had no actual or constructive notice of the prior grantee.

Question 4

How can a prior grantee protect his interest from a subsequent BFP?

Answer 4

A prior grantee must record his interest so as to ensure a subsequent purchaser has constructive notice of the prior interest.

Question 5

From when is the notice requirement of BFP status measured

Answer 5

BFP status is measured from the time of the conveyance, NOT the time of recording.

Question 6

To prevail in race and race-notice statutes, what action, if any must a BFP take to protect his interest?

Answer 6

Under race and race-notice statutes, the BFP must record his interest prior the prior grantee in order to prevail.

Question 7

Must a deed be recorded to be valid?

Answer 7

No. The deed is effective and enforceable between the original parties to it without being recorded.

Question 8

Name two advantages of properly recording a deed.

Answer 8

Properly recording a deed has several advantages, such as raising rebuttable presumptions that the instrument was validly delivered and that it is authentic.

Question 9

How can a landowner convey constructive notice of a deed?

Answer 9

By recording it. Recording conveys notice of the deed and its contents.

Question 10

Will properly recording a deed protect it from adverse possession?

Answer 10

Recordation does not protect against interests that arise by operation of law (e.g., title by adverse possession), rather than from a recordable document. Because there is no instrument to record to perfect such interests, the recording acts do not apply.

Question 11

To be valid, a deed:

Answer 11

must be a writing, signed by the grantor, that identifies the land and the parties.

Question 12

When does a deed become effective?

Answer 12

A deed is not effective until it has been delivered and accepted.

Question 13

Properly recording a deed creates what presumptions?

Answer 13

That a deed is authentic and was validly delivered. But these presumptions are rebuttable.

Question 14

In most jurisdictions, when is parol evidence not admissible?

Answer 14

Parol evidence is not admissible to show that a facially unconditional deed given directly to a grantee was in fact subject to a condition. The condition will be ignored.

Question 15

Generally, when is parol evidence admissible?

Answer 15

Parol evidence generally will be admitted to show oral conditions on the delivery of a deed placed in escrow.

Question 16

Generally, when the deed is given directly to a grantee, will parol evidence be admissible?

Answer 16

No.

Question 17

Generally, when a deed is deposited with escrow, will parol evidence be admissible?

Answer 17

Yes.

Question 18

If a court concludes by clear and convincing evidence that a deed was really given for security purposes, how will the court treat the deed?

Answer 18

A court will treat the deed as an equitable mortgage.

Question 19

How can an equitable mortgage be determined?

Answer 19

i) the grantor’s debt; (ii) the grantee’s promise to return the land if the debt is paid; (iii) the amount advanced to the grantor being much lower than the property value; (iv) the degree of the grantor’s financial distress; and (v) the parties’ prior negotiations.

Question 20

When can a voidable deed be set aside?

Answer 20

Voidable deeds will be set aside only if the property has not yet passed to a bona fide purchaser.

Question 21

Under the Uniform Fraudulent Transfer Act, a conveyance is fraudulent and may be set aside by the grantor’s creditors if:

Answer 21

the grantor/debtor actually intended to hinder, delay, or defraud a creditor; or if the grantor (i) did not receive a reasonably equivalent value in exchange for the transfer and (ii) was insolvent or became insolvent as a result of the transfer.

Question 22

Under the Uniform Fraudulent Transfer Act a conveyance, though fraudulent, will not be set aside against:

Answer 22

any grantee who took in good faith and paid reasonably equivalent value.

Question 23

When can a void deed be set aside?

Answer 23

Void deeds will be set aside by a court even if the property has passed to a bona fide purchaser.

Question 24

When is a deed considered void?

Answer 24

Deeds considered void include those that are forged, were never delivered, or were obtained by fraud in the factum (meaning the grantor was deceived and did not realize that he was executing a deed—e.g., a deed the grantor signed because he was told it was a promissory note).

Question 25

If O does not acquire title to property until after he purported to convey the property to A, what recourse does A have against O?

Answer 25

A can accept title to the land or possibly sue O for breach of covenants for title.

Question 26

What is the doctrine of estoppel by deed?

Answer 26

Under the doctrine of estoppel by deed, a grantor impliedly covenants that he will convey title upon its acquisition and is estopped to deny that he acquired title on the grantee’s behalf.

Question 27

If O does not acquire title to property until after he purported to convey the property to A, does O retain the title?

Answer 27

When O does not acquire title to property until after he purported to convey the property to A, O will NOT retain title because he lacked capacity to convey the land. Instead, the doctrine of estoppel by deed applies. If a grantor purports to convey an estate that he does not then own, his subsequent acquisition of title to the property automatically inures to the benefit of the grantee.

Question 28

If O does not acquire title to property until after he purported to convey the property to A, does A retain title?

Answer 28

When O does not acquire title to property until after he purported to convey the property to A, A will NOT acquire title only if she was a bona fide purchaser (“BFP”). A BFP is a purchaser who gives valuable consideration and lacks notice of a prior conveyance. The first grantee’s BFP status is irrelevant to the application of the doctrine of estoppel by deed.

Question 29

What is the result to a riparian landowner of the sudden, perceptible change of a watercourse that serves as a boundary to real property?

Answer 29

No change to the riparian landowners’ property rights will result, even if this results in the landowner becoming landlocked.

Question 30

What is avulsion?

Answer 30

Avulsion occurs upon the sudden, perceptible change of a watercourse serving as a boundary and does not result in a change to the landowner’s property rights.

Question 31

What is accretion?

Answer 31

Accretion refers to a change in a watercourse due to the slow and imperceptible deposit of soil. Accretion does change the legal boundary; the slow erosion of the bank results in the owner losing title to that area, and the slow deposit of soil belongs to the owner of the abutting land.

Question 32

Where accretion builds up in an irregular pattern over the lands of several adjacent property owners, courts determine title to it in a “just and equitable manner” which means:

Answer 32

(i) each owner’s property line is extended out into the water, or (ii) the newly formed land is divided in proportion to the owners’ interests in the adjoining lands.

Question 33

When a mistake or inconsistency in the description leaves in doubt the exact location of the property, and the court otherwise lacks clear evidence of the parties’ intent, the following rules of construction apply:

Answer 33

1. Natural monuments prevail over all other methods of description, including artificial monuments, courses and distances, and quantity measurements;
2. Artificial monuments prevail over all but natural monuments;
3. Course measurements (i.e., angles) prevail over distance measurements; and
4. All of the foregoing prevail over general descriptions, such as the name of the property or quantity (e.g., square footage or acreage).

Question 34

When a grantor transfers land to hinder a creditor, is the transfer voidable only at the transferee’s option?

Answer 34

No. The UFTA only provides a remedy for creditors, not transferees.

Question 35

When a grantor transfers land to hinder a creditor, is the transfer void?

Answer 35

No. A creditor can seek to have the transfer set aside, but conveyance will not be set aside as against a grantee who took in good faith and paid reasonably equivalent value.

Question 36

When a grantor transfers land as a gift to hinder a creditor, will the transferee keep the land?

Answer 36

Probably not. A deed will not be set aside under the UFTA as against any grantee who took in good faith and paid reasonably equivalent value. However, the transfer may be set aside by a court if the land was given as a gift (i.e., without receiving reasonably equivalent value).

Question 37

Will a court generally presume that a grantee’s return of a deed is a reconveyance to the grantor?

Answer 37

No. To effect a reconveyance, the grantee must execute and deliver a new deed.

Question 38

Will a court generally presume that a grantee accepts a deed if the conveyance would benefit her?

Answer 38

Yes. In most states, acceptance is presumed if the conveyance is beneficial to the grantee, regardless of whether the grantee knows of it. In other states, acceptance is presumed only where the grantee knows of the grant and fails to reject it.

Question 39

Will courts generally presume a minor has accepted a deed?

Answer 39

Yes. In all states, acceptance is presumed if the grantee is an infant or an incompetent.

Question 40

A recording act that provides: “Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded,” is a __________.

Answer 40

notice statute.

Question 41

A recording act that provides: “Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser whose conveyance is first recorded,” is a ___________.

Answer 41

race-notice statute.