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8. In this action, the buyer should
«No conveyance or mortgage of real property shall be good against subsequent purchasers for value and without notice unless the same be recorded according to law.»
Immediately upon learning of the buyer's actions, the son recorded his deed and brought an appropriate action to enjoin the buyer from removing the timber and to quiet title. The recording act of the jurisdiction provides:
Eight years ago, a doctor, prior to moving to a distant city, conveyed Blackacre, an isolated farm, to his son by a quitclaim deed. His son paid no consideration. The son, who was 19 years old, without formal education, and without experience in business, took possession of Blackacre and operated the farm but neglected to record his deed. Subsequently, the doctor conveyed Blackacre to a buyer by warranty deed. The buyer, a substantial land and timber promoter, paid valuable consideration for the deed to him. He was unaware of the son's possession, his quitclaim deed, or his relationship to the doctor. The buyer promptly and properly recorded his deed and began removing timber from the land.
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There are three types of recording acts: notice, race-notice, and race statutes. Under a NOTICE statute, a subsequent BFP prevails over a prior grantee who failed to record. The most important fact under a notice statute is that the subsequent BFP had no actual OR constructive notice at the time they purchased the property. Under a RACE-NOTICE statute, a subsequent BFP is protected only if they record before the prior grantee, without notice of the prior instrument. This gives an inducement to record quickly to reduce questions of title. Under a RACE statute, whoever records first wins, and actual notice of a prior grantee is irrelevant.
C is correct. The recording statute identified in the facts is a notice act. Generally, under inquiry notice, if a grantee is aware of facts or circumstances that would lead a reasonable person to inquire further, she is charged with constructive knowledge of all the facts a reasonable investigation would have disclosed. In this case, the facts state that the buyer was «unaware of the son's possession.» The buyer, however, is charged with inquiry notice by virtue of the fact that the son's possession and use of the land was open and notorious. Further, a majority of jurisdictions charge a grantee with knowledge of whatever she would have discovered by an inspection of the property. Under this theory, the buyer's notice prevents him from being protected by the recording statute.
A is incorrect. This is not true. What is important under the statute is whether the buyer qualifies as a BFP, not what type of deed was executed. The type of deed is only relevant to determine which kind of protection it offers to the grantee.
B is incorrect. This fact pattern does not deal with a gift situation. Even though the son paid no valuable consideration for the land, there is no indication that the doctor intended to make the land a gift to his son.
D is incorrect. It is a very subjective response. Whether the equities favor the son is not a question that can be answered by the simple facts of the fact pattern.