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10 Cards in this Set
- Front
- Back
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Recording system: 2 bright line rules
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1. If B is a bona fide purchaser for value (BFP) and we're in a notice jurisdiction (like VA), B always wins against previous buyers. Doesn't matter whether or not she records first.
2. If B is a BFP and we are in a race-notice jurisdiction, B wins if she records before A. |
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Bona fide purchaser for value (2 requirements)
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One who:
1. Buys Blackacre for value; and 2. Without notice that someone else got there first. |
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What counts as value for BFP purposes? 2 scenarios
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1. Bargain basement sale: as long as B pays substantial pecuniary consideration, that's enough. It can be well below market price.
2. Doomed donee: recording statutes don't protect donees, heirs, or devisees unless the shelter rule applies. |
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Forms of notice in a recording system (AIR)
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1. Actual: if prior to B's closing she learns of prior transfer to A.
2. Inquiry (VA does NOT recognize this): whether she looks or not, B is on inquiry notice of whatever an examination of Blackacre would show--if she sees A in possession, she's on inquiry notice of a prior transfer; also, if a recorded instrument makes reference to an unrecorded transaction, grantee is on inquiry notice of whatever a reasonable followup would show. 3. Record: if A's deed was recorded before B takes. NB: must be recorded properly, aka in the chain of title so it can be found. |
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Notice statute
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"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."
If B is a BFP when she takes, she wins against any prior transferees. Last BFP to enter the scenario wins! |
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Race Notice statute
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"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."
Key is the phrase "FIRST recorded". To prevail, B must be (i) a BFP and (ii) win the race to record. |
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VA recording system
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By statute, we're a notice jurisdiction. However, a 2008 VA Supreme Court case said in dicta it could be race notice. Tell examiners that scenario, but basically go with notice alone.
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Shelter rule
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One who takes from a BFP will step into her shoes and thus prevail against anyone that BFP would have prevailed against.
Example: O conveys to A, who does not record. Then 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 C vs. A, who wins? C because of the shelter rule (regardless of whether it's a notice or race-notice jurisdiction). |
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Wild deed
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If O sells to A, who does not record, and then A sells to B, who records the A-to-B deed, that is a wild deed because it is not connected to chain of title--it is incapable of giving record notice of its existence and thus is as good as not recording at all: B's recording is a nullity!
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Estoppel by deed
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O owns Blackacre in 1950 and is thinking about selling it to X but decides against it for now. X sells Blackacre to A anyway. A records.
In 1960, O finally sells Blackacre to X. X records. In 1970 X sells Blackacre to B. B records. As between X and A, who owned Blackacre from 1960-1970? A, because of estoppel by deed: if you convey property you don't have but then later acquire, you're estopped from denying the validity of the first conveyance. But who owns Blackacre after 1970? B! Go through the analysis: whether it's notice or race notice, B wins: A's recording was a nullity because it was a wild deed. |
