Chain of Title Problems

Subsequent Purchasers Wild Deeds Legally Recorded Common Grantors Constructive Notice

U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Guillette v. Daly Dry Wall, Inc.

325 N.E.2d 572 (Mass. 1975) Casebook, p. 592
August 1967 Gilmore (developer) conveys a lot to the Walcotts, by a deed referencing plan w/o restrictions but the deed restricts that lot to single-family use May 1968 Gilmore conveys lot to Guillette, by a deed referencing plan w/o restrictions but the deed restricts the lot to single-family use for the benefit of the other lots AND restricts the rest of the lots then owned by Gilmore

June 1968 Gilmore conveys lot to Paraskivas, by a deed referencing plan w/o restrictions but the deed restricts that lot to single-family use

April 1972 Gilmore conveys lot to Daly by a deed referencing plan w/o restrictions and the deed mentions no restrictions
U N I V E R S I T Y of H O U S T O N

August 1972 Daly learns of restrictions and gets permit to build apts.
Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Professor Marcilynn A. Burke

Guillette v. Daly Dry Wall, Inc. Contd

Chain of Title Problems Contd Common grantor Restrictions Notice

U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Chain of Title Problems, p. 597

2.a. A conveys to B, who does not record. O conveys to A, who does not record. B conveys to C, who records. A conveys to D, who records. (D is shown the deed from O to A.) O conveys to E, who records. Who prevails in a notice jurisdiction? Who prevails in a race-notice jurisdiction?
U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Chain of Title Problems, p. 597

2.b. O conveys to A, who does not record. O conveys to B, who knows of the deed from O to A and does not record. O conveys to C, who does not record. B conveys to D, who does not record. (D is shown the deed from O to B.) A records. B records. D records. Who prevails in a notice jurisdiction? Who prevails in a race-notice jurisdiction?
U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Persons Protected by the Recording System

Donees and Devisees? When do you become a BFP/subsequent purchaser? Consideration (conveyance v. contract) Should the buyer who pays only part of the purchase price before receiving notice of an earlier claim be entitled only to restitution (Daniels) or the benefit of his bargain (Lewis)?
U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Daniels v. Anderson
642 N.E.2d 128 (Ill. 1994), Casebook, p. 598

Persons Protected by the Recording System When do you become a BFP? Preemptive option (right of first refusal) Specific performance Equitable conversion
Lot 1 Daniels
U N I V E R S I T Y of H O U S T O N

Contiguous Parcel (optioned) Zografos

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Professor Marcilynn A. Burke

Daniels v. Anderson Contd

Pro Tanto: Three Potential Remedies 1. Award the land to the earlier claimant upon reimbursement of the later purchasers money already paid. 2. Award the later purchaser a fractional interest equal to amount paid before notice. 3. Award land to later purchaser but require remaining payments be made to earlier claimant.
U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Lewis v. Superior Court

37 Cal. Rptr.2d 63 (1994), Casebook, p. 600

Feb. 1991 Lewises contract to buy house from Shipley for $2.3 million & open escrow

Feb. 24, 1991 Fontana Films files a lis pendens against Shipley

Feb. 25, 1991 Lewises pay Shipley $350,000 on the contract

Feb. 28, 1991 Closing: Lewises get deed, record, and give Shipley note for $1.95 million

Feb. 29, 1991 Lis pendens is indexed

March 1992 Lewises paid note off

March 1992 Summer 1993 Lewises spend approx. $1.0 million renovating property
U N I V E R S I T Y of H O U S T O N

Sept. 1993 Lewises served in Fontanas lawsuit and learn of lis pendens
Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Professor Marcilynn A. Burke

Lewis v. Superior Court Contd

Persons Protected by the Recording System When do you become a BFP? Recording statute? When was the lis pendens recorded? Index = Record?

U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.

Lewis v. Superior Court Contd

Persons Protected by the Recording System Reconciling Davis v. Ward Modern times Actual v. constructive notice Appropriate remedy available Cash v. financing w/ 3d party

U N I V E R S I T Y of H O U S T O N

Professor Marcilynn A. Burke

Copyright2009 Marcilynn A. Burke All rights reserved. Provided for student use only.