There can be situations even after a title search that the true ownership of property is unclear. In one actual situation, a property record search showed that the deed of the property from the 1940s showed ownership by one party, yet through the 1960s through the 2000s, there are records of mortgages on the property and satisfaction of mortgages under various names other than the names on the deed, yet no new deed recorded.
Moreover, the person occupying the home is a grandson of the last named persons who had a mortgage on the property. Now that grandson wants to probate the deceased grandparents’ estates in the hopes to pay off tax liens that are against the grandparents as owners of the property. The situation becomes even murkier because the grandson’s mother is still alive and incapacitated.
Given all this, what is necessary to resolve this title issue? One option is to commence a quiet title action to have the court decide and order who has title to the property. One title insurance company said it would not provide insurance without such an order and assurance from the court.
Quiet Title actions usually provide that any person who claims an interest in real property can make a claim to compel the determination of the ownership of that property. The defendants can make a claim adverse to that of the plaintiff. Competing claims can be based on public records or other evidence. In other words, if someone has some direct or circumstantial evidence sufficient to make a claim of ownership of the property, that person can file a claim in court with notice to any other party that may have a similar claim to the property with the court determining ownership.
Sometimes it is virtually impossible to notify or to join all potential defendants. For example, in the above situation, the grandson, if he ever was able to become the personal representative of his last to die grandparent’s estate, filed a claim, the court could likely order a publication in a newspaper of the claim since it would be unlikely that the owners of the property in 1940 are locatable or are still alive, or their heirs are locatable.
With this, after all are joined or notified to satisfy the court, the Judge would review the evidence and make a determination. Even after the quiet title decision, there could be issues pertaining to the distribution of the property among the heirs, and outstanding claims against the property such as the tax liens in the situation described above.
A list of other reason for a quiet title action can include the following:
Adverse possession claims;
Fraudulent conveyance claims;
Title registration, clerical errors and unrecorded claims;
Tax issues regarding back taxes;
Survey errors; and
Competing claims among heirs and lien holders.
There can be many challenges to Quiet Title actions, even after a final court decree. In any event, if someone wants to inherit property that they think they are entitled to receive, and there is no clear ownership of the property, and there is the chance that no one would buy the property without title insurance if the heir wants to profit from the property, then a Quiet Title action may become necessary to attempt to resolve the issue.
Feel free to contact me to discuss more or to share your insights here in the comment section. If we are not Linked In, feel free to Linked In with me. Damien Bosco, Esq., Bosco Law Firm, LLC, firstname.lastname@example.org, 1350 Avenue of the Americas, 2d Floor, New York, New York 10019. www.boscolawfirm.com