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Flashcards in The Recording System Deck (31):
1

Describe a notice recording statute.

If B is a bona fide purchaser, B wins, regardless of whether or not she records before A.

2

Describe a race-notice statute.

If B is a bona fide purchaser, B wins if she records properly before A does.

3

Which two groups of people are protected by recording statutes?

BFPs and mortgagees

4

A BFP is one is . . . (2)

Buys Blackacre for value;

w/o notice that another got there first

5

B paid $50k cash for BA, when its FMV is estimated at $100k. Is B a purchaser for value? Explain.

Yes,B remitted substantial pecuniary consideration

6

What is the rule regarding "bargain sales" and BFP?

A bargain sale buyer is still a BFP as long as he remits "substantial pecuniary consideration"

7

O sold to A, then bequeathed to B. In a recording statute question, B . . .

Loses

UNLESS the Shelter Rule applies.

8

What are the three forms of notice with which a buyer may potentially be charged? Pneumonic?

AIR

Actual

Inquiry

Record

9

Whether he looks or not, B is on inquiry notice of . . .

Whatever an examination of the land would show.

10

If a recorded instrument makes reference to an unrecorded transaction, grant is on inquiry notice of . . .

Whatever a reasonable follow up would have revealed.

11

B is on record notice of A's deed IF at the time B takes . . . .

A's deed has been recorded properly.

12

Which sort of statute? "A conveyance of an interest in land shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded."

Notice

13

Under a Notice statute, what is the only thing B must do in order to take?

Be a BFP before A records.

14

Under a notice statute, what result if O conveys to A, then conveys to B (BFP), then A records. B fails to record. Explain.

Land to B.

If at the time B takes, he is a BFP, he wins. It won't matter that A ultimately recorded first. Nor does it matter that B never recorded.

15

Which sort of statute? "Any conveyance of an interest in land shall not be valid against any subsequent purchaser for value, without notice thereof, whose conveyance is first recorded."

Race-notice.

16

Two requirements to win under a Race-Notice statue?

BFP

Record first.

17

On March 1, O conveys to A (BFP). A does not record. On April 1, O conveys the same parcel to B (BFP) who does not record. On May 1, A records.

Who takes in N jurisdiction?

Who takes in RN jurisdiction?

B in N

A in RN

18

How can A always defeat a subsequent purchaser? Explain

Simply record before B takes.

If A records, B is put on record notice and is thus precluded from BFP status.

19

To give record notice to subsequent takers, the deed must be recorded properly within . . .

The Chain of Title

20

The chain of title refers to what?

The sequence of recorded documents capable of giving record notice.

21

In most states, how is the chain of title established?

Grantor-grantee index.

22

What are the three primary chain of title problems?

The Shelter Rule

The Wild Deed

Estoppel by Deed

23

What does the Shelter Rule say?

One who takes from a BFP will prevail against any entity that the transferor-BFP would have prevailed against. In other words, the transferee takes shelter in the status of her transferor, and thereby steps into the shoes of the BFP EVEN THOUGH she otherwise fails to meet the requirements of BFP status.

24

O conveys to A, who does not record. Later, O conveys to B, a BFP, who records. B then conveys to C, who is a mere donee (or who has actual knowledge of the O to A transfer). In the contest of A v. C, who wins in a Notice Juris.? In a Race-Notice Juris.?

Explain

C wins in both.

Under the Shelter Rule, C steps into the shoes of B, who was a BFP who recorded first.

25

O sells BA to A, who does not record. A then sells to B. B records the A-to-B deed. What is this called? Why is it problematic?

Wild Deed.

Problematic because the deed is NOT connected to the chain of title, as the O-to-A link is missing from the records.

26

What is the rule of the Wild Deed?

If a deed, entered on the records (A to B) has a grantor unconnected to the chain of title (O to A), the deed is wild and is incapable of giving record notice of its existence.

27

O sells BA to A, who does not record. A then sells to B. B records the A-to-B deed.

O then sells BA to C. Assume C has no actual or inquiry notice of to the O-to-A or A-to-B transactions. C records.

O skips town. In the contest of B vs. C, who wins in a NJ? In a RNJ? Explain each.

C wins in both.

C wins in a NJ b/c at the time C takes, she is a BFP.

C wins in a RNJ because she is a BFP who wins the race to record.

NOTE: B's recording is a nullity due to the Wild Deed.

28

O sells BA to A, who does not record. A then sells to B. B records the A-to-B deed.

We say that B's recording is a ______.

Nullity.

29

In 1950, O owns BA. He is thinking about selling it to X, but for now decides against it.

In 1950, X, who does not own BA, sells it anyway, to A. A records.

In 1960, O finally decides to sell BA. He sells to X. X records.

In 1970, X, sells BA again, this time to B. B records.

AS BETWEEN X and A, who owned BA from 1960-1969? Explain.

A did, because of the rule of Estoppel by Deed. One who conveys realty in which he has no interest (here, X) is estopped from denying the validity of that conveyance IF he later acquires the previously transferred interest.

30

In 1950, O owns BA. He is thinking about selling it to X, but for now decides against it.

In 1950, X, who does not own BA, sells it anyway, to A. A records.

In 1960, O finally decides to sell BA. He sells to X. X records.

In 1970, X, sells BA again, this time to B, a BFP. B records.

Who owns BA in 1970 in a NJ? In an RNJ?

B in both.

In NJ because he is BFP.

In RNJ because is a BFP who records first.

31

In 1950, O owns BA. He is thinking about selling it to X, but for now decides against it.

In 1950, X, who does not own BA, sells it anyway, to A. A records.

In 1960, O finally decides to sell BA. He sells to X. X records.

In 1970, X, sells BA again, this time to B, a BFP. B records.

As of 1970, B owns BA in both an NJ and and RNJ. Why not A? Include an explanation of how B is affected.

A's 1950 recording is a nullity. It occurred too early.

B's title searcher would not find A's deed. This is because one is entitled to assume that no one sells land until they first own it. Thus, B's title searched would not discover X's 1950 pre-ownership transfer to A.