Volume 10 Number 2
|
Volume 10 Number 2
|
|
|
Title
Tips by Tute Volume
10, Number 2 Dear
Tute: Husband
and wife own several properties out in the County.
In performing a title examination of one property, I discovered a deed of
trust that appears to encumber one property, or maybe two, I can't tell. The
deed of trust has an exhibit attached, which describes the property by reference
to a previously recorded deed and includes a tax account number ("certain
property . . . . more particularly described in . . . DB 555 page 1212" . .
. with parcel ID number 12345 . . . and includes a reference to a deed date and
and a recording date). The front
page of the deed of trust states the property's street address and has (hand
written) map parcel number 99-1A. The
deed of trust was later modified, but the modification does not clear things up
at all! The attached exhibit
describes the property by lot and block in a recorded subdivision, has the same
street address, but states the map parcel number is 55G(5)-55.
I
looked up all the properties they own on the tax assessor's computer.
The property they acquired in DB 555 page 1212 doesn't match the street
address on the front page of the deed of trust, but does match the typed parcel
ID number and the handwritten map parcel number.
The lot and block described in the modification matches the street
address in the original, the map parcel number given in the modification and the
parcel ID number in the original. There
are other properties which don't match by address, tax parcel number, parcel ID
number (and are not worth enough to secure the deed of trust) How do
I write it up? Do I include it at
all, and for which property?
- Befuddled Dear
Befuddled:
This sounds like a game my children beat me up on all the time.
My answer is "Jane is wearing the yellow hat and Ruth is wearing the
red sweater."
Seriously, there is nothing wrong with your eyes or your examination
skills. Full
credit for your confusion goes to the drafter of the deed of trust and its
modification. I
think you have come across what the litigators call a "patent
ambiguity."
You definitely need to write it up.
You didn't indicate what sort of transaction you were involved in, but
this should be cleared up before the parties take another step.
A "patent" ambiguity is one that is apparent from the document
itself (as opposed to a "latent" ambiguity, which you don't discover
until receiving information that is not in the document).
Tute is not going to suggest
how the underwriters in your office should handle this.
But should I come across this title in the future, I would like to see a
resolution something along the lines of the following two possibilities.
My first choice, vindictive though it might be, is for a new modification
to be prepared to your satisfaction (preferably by whoever messed up the first
two - and at no charge - even old dogs might learn when it costs them time or
money), specifically pointing out the ambiguity arising from the multiple
methods of describing a property, specifically stating the property intended to
be encumbered, describing it fully and correctly, and releasing any claim to any
other property of the borrower. The
more likely (and more economically efficient - though not nearly as psychically
pleasing) is for the lender to record a certificate of partial satisfaction,
releasing its lien against the "wrong" property. You
may have noticed that I didn't say which property is the "right" one
and which is the "wrong" one. That's
because you just can't tell (that's why it is an ambiguity), although I do think
you narrowed the choice down to the two most likely candidates. One possibility
you didn't mention is that this might have been a construction loan, and the
deed of trust exceeds the value of the properties you rejected because proposed
improvements will increase their value to a point exceeding the loan amount.
This
suggests a future topic . . . how good does a description need to be . . . any
interest?
Tute
Dear
Readers:
In between the multiple demands
on my time last month (to my esteemed, benevolent and all-knowing corporate
powers-that-be, what drop in order count?), Tute
glanced
over the last issue of the VLTA
Examiner and
was excited to see not just one, but two articles dealing with a very sticky
problem - conveyances of the property of a deceased owner.
Walter Wilson's article Pews to Periwinkle - Part 2 contained
a brief summary that said either the executor or the devisees could convey.
Bill Amrhein analyzed the judicial source of confusion in his article Yamada
v. McLeod: The Good, the Bad
and the Ugly, but never quite mentioned what we were to do in the future.
Still on my reading list is the November 2003 issue of the Virginia State
Bar Real Property Section newsletter, which had an article by Doug Dewing
entitled Power of a Personal Representative to Sell Real Estate: What is a
Settlement Attorney to Do in the Twenty-First Century?
Can I can just use the box at the end and not read the whole thing?
While all three authors are a lot smarter than I am, they just didn't
help me figure out what to look for in the record room. What
do you look for? How do you treat
these sales? If underwriting
counsel were to quit being so "wishy-washy" and send out a bulletin
for the title examiners, it would be helpful.
Maybe your counsel is better than mine.
Feel free to e-mail me at theunknowntitleexaminer@mail.com.
Title examiners aren't subject to those anti-trust laws that keep
managers and counsel from talking to each other, are they?
Tute |
|
Send mail to webmaster@tute.us with
questions or comments about this web site.
|
