Just for the Record (Part I of II)
Articles from The Massachusetts Focus
Newsletter of Stewart Title Guaranty Company, Massachusetts Offices
Winter 2004, Volume 3, Number 1
Just for the Record
by Gary F. Casaly, Special Counsel
Just for the record, you should know that . . .
[No] mortgage, bargaine, sale or gruant hereafter to be made of any houses, lands, rents or other hereditaments, shall bee of force against any other person except the grauntor and his heirs, unless the same be recorded as is hereafter expressed [in the publik Record] . . . . And if any such grauntor, being required by the grauntee to make an acknowledgement of any graunt by him made, shall refuse to do so, it shall be in the power of any magistrate to send for the party so refusing and cimmit him to prison without baile or mayneprize, until he shall acknowledge the same . . . .
For the history buff, that's the earliest recording statute, which was passed in Massachusetts in 1640. The text appears in R. Powell & P. Rohan, 3 The Law of Property, Matthew Bender (1992), 904. Except for the fact that the word "gruant" in the second line is obviously a misprint (as the root word throughout the rest of the section is "graunt"), there are no typos in the statute, but you'll have to get beyond the Chaucer-like spelling if you expect to (or even want to) understand the Colonial jargon.
Why would you want to understand this ancient statute anyhow (other than the fact that it might be good cocktail party talk, depending on your audience)? Understanding the machinations of the recording law as it has developed over the years answers many questions concerning priorities between competing interests, conflicting chains of title, out-of-order recordings and even questions as to whether parties with no ownership at all can convey a good title. As we'll see there are some real surprises in store as to what happens when the recording statute is applied in particular cases.
The Colonial enactment is for the most part entertaining, but today's recording laws and cases that swirl around its provisions find their geneses in it. It is interesting and informative to follow the progeny of this old law and watch how the legislature has changed it and how the courts have reformed it. Before we begin our journey, however, let's see what the present recording law (G.L.c. 183, §4) provides.
A conveyance of an estate in fee simple, fee tail or for life, or a lease for more than seven years from the making thereof, or an assignment of rents or profits from an estate or lease, shall not be valid as against any person, except the grantor or lessor, his heirs and devisees and persons having actual notice of it, unless it, or an office copy as provided in section thirteen of chapter thirty-six, or, with respect to such a lease or an assignment of rents or profits, a notice of lease or a notice of assignment of rents or profits, as hereinafter defined, is recorded in the registry of deeds for the county or district in which the land to which it relates lies.
The present-day statute is not dissimilar from the Colonial law (although it is easier to read!), but there is one very big difference: the statute introduces as an exception to its protection the requirement that the grantee not have "actual notice" with regard to deeds previously given by the grantor. This concept is absent from the Colonial law. In this respect, the Colonial law was a "race" statute, while the present-day law is a "notice" statute. The transformation between the two types of statutes was not initially championed by the legislature. The General Court engrafted the change in 1836 legislation, but the notice concept was first introduced judicially many years before, in such cases as Farnsworth v. Child, 43 Mass. 637 (1808). In Farnsworth the court had ruled that although the statute was silent on the point as to the status of one who was aware of an unrecorded deed, it would be unjust to permit such a person to prevail over a "good faith" purchaser who had no such knowledge. It is for this reason that it has been said that "[T]he additional words 'and persons having actual notice thereof' incorporated in the [statute] did not change the law, but merely put in statutory form what already had been declared by judicial exposition." This concept of notice becomes pivotal in many issues concerning the recording system, and is so pervasive that it even affects registered land. For example, in Killam v. March, 316 Mass. 646 (1944), where the owner of registered land had taken title with knowledge of the existence of a lease affecting the property but recorded on the unregistered side, the court said that the owner was subject to the lease even though it did not appear on the certificate of title. "[T]he foregoing historical background compel[s] the conclusion that the Legislature did not intend to give certificate holders such as the plaintiffs an indefeasible title as against interests of which they had actual knowledge."
In addition to persons having "actual notice" of an unrecorded instrument, there are two other categories of persons who are bound by such instruments. They are, under the provisions of the statute, "the grantor or lessor [and] his heirs and devisees." The first category, the grantor or lessor, is pretty obvious. The second category, heirs and devisees, is very important. Heirs and devisees are bound by an unrecorded instrument, whether or not they have notice of it. This means that if the grantor gives a deed, whether it's recorded or not before his death, the heirs and devisees, who otherwise would have succeeded to the title, will nonetheless be bound by the deed and title to the property will not vest in them. But if the heirs and devisees are bound by the unrecorded deed, and therefore don't have title upon the grantor's death, what happens if they deed out after the grantor's death and before that previously-given deed appears of record? Does their grantee get a good title even though they don't have one to transfer? The answer is "yes," and revolves around the recording statute itself, and is explained in Earle v. Fiske, 103 Mass. 491 (1896). In Earle the facts were that Nancy Fiske gave a deed of locus to Mary Fiske in 1864, but the deed was not recorded at that time. Nancy died in 1865. In 1866 Benjamin Fiske, Nancy's sole heir, deeded the property to Nicholas Earle, and it was only the next year, in 1867, that the deed from Nancy to Mary was recorded. Nicholas claimed the title as his under the deed from Benjamin. Mary, however, insisted that she was the rightful owner.
All the parties in Earle, and the court itself, acknowledged the general proposition that Nancy's giving of the deed to Mary stripped the former of her title and vested it in the latter, but that Nancy would still have been able to give a good title to a bona fide purchaser before the deed was recorded. The question in the case, however, was whether Benjamin, Nancy's sole heir, could likewise give a good title before the deed was recorded. The trial court had ruled that Nancy "has no seisin, at her death, which would descend to Benjamin Fiske, so as to enable him to convey a good title." Two jurisdictions at the time, Connecticut and Kentucky, had ruled that under their statutes a person in Benjamin's position could not give a good title, even before his mother's deed was recorded, and that the protection that the recording statute provided, although applying to the grantor, would not apply to her heirs. The trial court had followed these rulings, but the Supreme Judicial Court took a different position:
We do not, under the circumstances, incline to yield to the authority of [the Connecticut and Kentucky] cases in the construction of a local statute of this Commonwealth. It appears to us that the plain meaning of our system of registration is, that a purchaser of land has a right to rely upon the information furnished him by the registry of deeds, and in the absence of notice to the contrary he is justified in taking that information as true, and acting upon it accordingly. It is impossible to see why the unrecorded deed of Nancy A. Fiske should have any greater weight or force after her decease than it had immediately after it was first delivered. * * * Upon that assumption, [Benjamin's] deed would take precedence over the unrecorded deed of his mother, in exactly the same manner as a deed from his mother in her lifetime would have done over any unrecorded or unknown previous deed from herself.
The court acknowledged that "[i]t may not be very logical" to say that after a title has been conveyed out it is still capable of being conveyed again as though the first conveyance had not occurred, but the result was dictated not on logic, but on fairness, and was based on giving integrity to the recording system.
One important point that should be noted about the recording statute is that it does not protect "the grantor . . ., his heirs and devisees and persons having actual notice of" the conveyance. This listing includes three separate groups. We've seen that in the Earle decision an heir or devisee, though bound by the deed of the ancestor, can nevertheless give a good title to a third party who qualifies as a bona fide purchaser without notice. The axiom to this rule is that if the grantor dies before his or her deed is recorded the heirs and devisees, though they are able to pass a good title before such recording, cannot do so after such recording. In Earle the heirs gave a deed to a purchaser before their ancestor's deed was recorded. Though the heirs did not have any title to give, the purchaser's title prevailed. On the other hand, if the ancestor's deed had appeared of record after the ancestor's death but before the heirs had deeded out, the ancestor's deed would have prevailed and a later deed by the heirs to the purchaser would have failed. At that point the ability of the heirs or devisees to give a good title would terminate. The heirs, being bound by the deed according to the statute, cannot complain about this result. So, it becomes important when "running the title out" after the ancestor's death to continue running the ancestor and the heirs until a conveyance is found. Though it "looks like" the heirs or devisees have title upon the ancestor's death, this may only be an illusion.
Recording an instrument is not necessary to transfer the title, but rather has the purpose of protecting good faith purchasers who are relying upon the records filed with the registry of deeds from a competing off-record title that thereafter materializes on the record. For example, in King v. Stephens, 9 Mass.App.Ct. 919, 404 N.E.2d 115 (1980), where the issue was merely the out-of-order recording of various deeds between family members, the court said, "The problem presented is not one of priority as between two conflicting, successive conveyances to bona fide purchasers, or persons claiming under them, of the same legal interest in land, and thus is not a problem to be resolved by application of the recording statute, G.L.c. 183, §4." But though recording is not necessary to pass title, an improper or ineffective recording (or none at all) will permit competing interests to intervene. So, what is an "improper or ineffective" recording? What happens, for example, if an instrument is tendered to and accepted by the recorder, but is not properly indexed? Is that an "improper or ineffective" recording? The answer is "no." The recording in fact is effective and binding even though a thorough search of the index will not discover it! In Park, Massachusetts Practice, Real Estate Law, with Forms, West Publishing Co. (Second Edition, 1981), §420 this is said:
The record of an instrument erroneously indexed is still constructive notice to the public. The index ordinarily is no part of the record, and a mistake made in it by the clerk does not invalidate the notice afforded by a record otherwise in proper form.
An improperly acknowledged instrument or one that contains no acknowledgment at all, is deemed not to be effectively recorded. Such an instrument is effective to convey title - just like an unrecorded instrument would do - but its record is a nullity, and thus the protection afforded by the recording statute does not exist. Pidge v. Tyler, 4 Mass. 541 (1808).
If acknowledgement is so important to the effective recording of an instrument, what kinds of acknowledgments would be deemed defective? Obviously, the complete lack of an acknowledgment renders the recording a nullity. In some situations, however, a certificate of acknowledgment may have been affixed to the instrument but the recording nonetheless deemed defective. For example, if the grantee in a deed serves as the notary who takes the acknowledgment of the grantor the acknowledgment will be deemed defective. In Patton on Titles, West Publishing Company (Second Edition, 1957) this is said in Section 356:
Public policy forbids that the act of taking and certifying the acknowledgment should be performed by a person financially or beneficially interested in the transaction. Such disqualification naturally includes the signer of the instrument, his grantee, mortgagee, trustee, beneficiary or assignee, a member of the partnership in whose favor the instrument is drawn, and, except where the disability has been removed by statute, stockholder[s] of a corporation which is a party to [the] conveyance. (Citations omitted).
What if the grantee does not serve as the notary, but goes before the notary? Is the acknowledgment okay? The statute that governs acknowledgments (G.L.c. 183, §30) requires that "one or more of the grantors" acknowledge the instrument. If, for example, a husband and wife as tenants by the entirety join in a deed to the wife and she alone goes before the notary, is the acknowledgment defective? Gordon v. Gordon, 8 Mass.App.Ct. 860, 398 N.E.2d 497 (1979), cited in footnote 1 above, says that the acknowledgement is good. The Gordon court held that although the wife was the grantee, she also qualified as a "grantor." (One authoritative source confines the Gordon decision to the facts - a deed from husband and wife to one of the spouses - but this interpretation seems too limiting.)
What about a notarial seal? If one is not affixed to the instrument is the acknowledgement defective and thus the recording ineffective? Acknowledgments within Massachusetts do not require a notarial seal. Those taken outside of Massachusetts but within the United States do not require one either. (Title Standard No. 16 once required such seals. That was changed in 2000, but there never really was a requirement of a seal in such cases. See Farnum v. Buffum, 58 Mass. 260 (1849), where the court said, with regard to an acknowledgement taken in Rhode Island, "The statute requires no notarial seal to the notary's certificate of acknowledgement, and none, we think, was necessary.")
Under G.L.c. 184, §24 an instrument that has been on record for more than ten years is "cured" of the effects of a defective acknowledgment.
1 An exception to this rule existed between 1912 and 1975 when deeds between spouses were not effective to pass title until the instrument "is duly acknowledged and recorded in the registry of deeds." See G.L.c. 209, §3 (since amended) and Gordon v. Gordon, 8 Mass.App.Ct. 860, 398 N.E.2d 497 (1979) for a discussion of that law in effect at the time. [Back to Text]