PastPaperHero | Titles - Chain of title

Learning Outcomes

This article explains chain of title and recording-act issues tested on the MBE, including:

How the chain of title is constructed from a grantor–grantee index, which instruments fall inside or outside the chain, and why this determines what counts as record (constructive) notice on exam questions.
How to distinguish and apply notice, race-notice, and race statutes, identify the protected class of subsequent purchasers, and determine priority where multiple conveyances arise from a common grantor.
How wild deeds, late recordings, deeds recorded before the grantor obtained title, and other breaks in the chain affect priority, the visibility of interests in the public record, and common MBE traps.
How chain-of-title problems interact with marketable title doctrine, including when defects render title unmarketable and allow a buyer to refuse to close or demand cure.
How to use the shelter rule and the three forms of notice—actual, record, and inquiry—to analyze step-by-step who prevails in complex fact patterns involving installment land contracts and successive transfers.

MBE Syllabus

For the MBE, you are required to understand title to real property and the operation of recording acts, with a focus on the following syllabus points:

The definition and significance of chain of title in a grantor–grantee index system.
The operation of recording acts (notice, race-notice, and race statutes) in resolving conflicting conveyances.
The effect of wild deeds, late recordings, and other breaks in the chain on constructive (record) notice.
The requirements for marketable title and how defects in the chain, encumbrances, and recording problems affect it.
The impact of chain of title issues on bona fide purchasers, including the shelter rule and installment land contracts.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

Which of the following is most likely to render a title unmarketable?
1. A mortgage that will be paid off at closing.
2. A wild deed outside the chain of title.
3. A properly recorded easement for utilities.
4. A zoning ordinance restricting use.
Under a notice recording statute, who prevails if O conveys Blackacre to A (who does not record), then to B (who pays value and has no notice), and then A records before B?
1. A, because she recorded first.
2. B, because she paid value and had no notice.
3. O, because he conveyed twice.
4. The state, because the recording statute is unclear.
What is a "wild deed" in the context of chain of title?
1. A deed that is forged.
2. A deed recorded but not connected to the chain of title.
3. A deed with ambiguous property description.
4. A deed delivered after the grantor's death.

Introduction

A clear chain of title is essential for determining who owns real property and whether a buyer can obtain marketable title. The chain of title is built from the public land records and is the sequence of recorded documents tracing ownership and encumbrances from the present owner back to an accepted starting point (often a “root of title” many decades ago).

In practice, exam questions assume a grantor–grantee index system. A title searcher starts with the current grantor, looks back to see how that grantor acquired title, then repeats the process with each earlier grantor for the statutory period. Only instruments that appear in this chain, under the correct names and dates, are treated as giving record (constructive) notice.

Key Term: Chain of Title
The sequence of recorded documents that establish the history of ownership and encumbrances for a parcel of real property, as it appears in the public records under the applicable indexing system.

If there are breaks or defects in this chain—such as missing links, wild deeds, or late recordings—a later purchaser may not be charged with notice of certain interests, even though those interests are in fact recorded. Those same defects can also make title unmarketable and give a buyer the right to walk away from the contract.

The Role of Recording Acts

Recording acts protect certain subsequent purchasers by allowing them to rely on the public records rather than having to investigate every possible off-record claim. At common law, the rule was “first in time, first in right”: the first grantee from a common grantor prevailed, even if a later grantee recorded first. Recording statutes modify that rule to protect subsequent purchasers who meet statutory requirements.

There are three main types of recording statutes:

Notice statutes: Protect a subsequent purchaser who acquires without notice of a prior unrecorded interest, even if the prior interest is later recorded.
Race-notice statutes: Protect a subsequent purchaser who both acquires without notice and records first.
Race statutes: Protect whoever records first, regardless of notice.

Key Term: Notice Statute
A recording act under which a subsequent bona fide purchaser without notice of a prior unrecorded interest prevails, even if the prior interest is later recorded.

Key Term: Race-Notice Statute
A recording act under which a subsequent bona fide purchaser without notice prevails only if she also records before the prior interest is recorded.

Key Term: Race Statute
A recording act under which the party who records first has priority, regardless of notice or good faith.

These statutes protect only subsequent purchasers for value who meet the statutory conditions.

Key Term: Bona Fide Purchaser (BFP)
A person who gives value in an arm’s-length transaction and acquires an interest in property without notice (actual, record, or inquiry) of a prior interest.

Types of Notice and the Chain of Title

Whether a purchaser is a BFP—and therefore protected by the recording act—turns on whether that purchaser had any form of notice of the prior interest when she took her deed.

Key Term: Actual Notice
Knowledge that the purchaser actually possesses about a prior interest, from any source (e.g., being told about it, seeing a deed).

Key Term: Record (Constructive) Notice
Notice imputed to a purchaser from properly recorded instruments that are in the chain of title and therefore discoverable by a reasonable title search.

Key Term: Inquiry Notice
Notice arising when circumstances (such as visible possession or use inconsistent with record title) would prompt a reasonable purchaser to investigate; the purchaser is charged with what a reasonable inquiry would have revealed.

Record notice depends heavily on the chain of title. A deed gives constructive notice only if it is:

Properly recorded in the correct office; and
Indexed in such a way that it appears in the chain of title for the grantor.

Deeds recorded too early, too late, or under names that never appear in the chain may be invisible to later purchasers and thus give no record notice.

Key Term: Wild Deed
A deed that is recorded but not connected to the chain of title, so it cannot reasonably be found in a standard title search and does not provide constructive notice to subsequent purchasers.

Breaks in the Chain: Wild Deeds and Late Recordings

A wild deed arises when a deed is recorded but is not linked to the chain of title, often because a prior deed in the chain was not recorded. For example, if O conveys to A, A fails to record, and A then conveys to B, B’s deed from A—though recorded—is “floating” with no recorded link to O. Someone searching the index under O’s name will never see the A–B deed.

Wild deeds do not give constructive (record) notice to later purchasers. A bona fide purchaser who meets the recording act requirements may therefore take free of the interest reflected in the wild deed, even though the wild deed is actually recorded.

Late recordings are another common source of chain defects. A late recording occurs when:

A deed is recorded after the grantor has already conveyed the property to someone else and that later deed is already on record; or
A deed is recorded after the time period during which a reasonable searcher would check under that grantor’s name.

In most jurisdictions, deeds recorded after the grantor has parted with record title are treated as outside the chain of title and therefore do not give record notice to later purchasers.

Marketable Title and Chain Defects

A marketable title is one that is free from reasonable doubt or risk of litigation. It does not have to be perfect, but it must be such that a reasonable buyer would accept it, confident that no one else will later assert a superior claim.

Key Term: Marketable Title
Title that is free from reasonable doubt and not subject to significant risk of litigation, making it acceptable to a reasonable buyer.

Defects in the chain of title—such as wild deeds, missing links, ambiguous property descriptions, or deeds from grantors who never appear to have held title—create uncertainty about who actually owns the property. Because they raise a reasonable risk of future litigation, these defects render title unmarketable. A buyer under a land sale contract can refuse to complete the transaction if the seller cannot cure the defect before closing.

Worked Example 1.1

O conveys Blackacre to A, who does not record. O then conveys Blackacre to B, who pays value and has no notice of A's deed. B records. Later, A records. Who owns Blackacre in a notice jurisdiction?

Answer:
B owns Blackacre. Under a notice statute, a subsequent bona fide purchaser without notice of the prior unrecorded deed prevails, even if the prior grantee later records. A’s later recording does not defeat B, because B’s status is fixed at the time of conveyance.

Worked Example 1.2

O conveys Blackacre to A, who records. A then conveys to B, but B does not record. Later, A conveys Blackacre again to C, who pays value and has no notice of B's deed. C records. B then records. Is B's deed a wild deed as to C?

Answer:
Yes. When C searched the records, she saw O–A and A–C. B’s deed from A had not yet been recorded. When B eventually records, the B deed is outside C’s chain of title because A had already conveyed all record title to C. As to C, B’s deed is a wild deed and does not give C record notice. C is protected as a bona fide purchaser.

Worked Example 1.3

O owns Blackacre. O conveys to A, who does not record. A then conveys to B, who records. Later, O conveys Blackacre to C, who pays value, has no actual notice of A or B, and records. In a race-notice jurisdiction, who prevails?

Answer:
C prevails. B’s deed from A is a wild deed because there is no recorded O–A deed linking A into the chain. A search under O’s name will show only the O–C deed, not A–B. Thus B’s recording does not give C record notice. C is a BFP without notice and records first; race-notice protects C over B.

The Shelter Rule and Installment Land Contracts

Recording acts also include the shelter rule, which interacts with chain-of-title problems.

Key Term: Shelter Rule
A rule that allows a person who takes from a bona fide purchaser to “shelter” under the BFP’s status and obtain the same protection, even if the transferee herself is not a BFP.

If B is a BFP who prevails over A, then B can convey to C, and C takes free of A’s interest even if C has notice or is a donee. The shelter rule prevents the marketability of BFP’s title from being frozen; it allows titles to be resold freely.

An additional issue arises with installment land contracts (where the deed will be delivered only after the buyer makes a series of payments). In most states, a contract purchaser who records is protected by the recording act only to the extent of the payments already made at the time a conflicting interest arises. Courts respond in various ways (e.g., giving the purchaser a fractional interest or a lien for amounts paid), but the key exam point is that a partially paid contract purchaser may not receive full BFP protection for the unpaid balance.

Marketable Title and Chain Defects in Exam Scenarios

Marketable title obligations arise from the land sale contract, not from the deed. The seller promises to deliver marketable title at closing. Title may be unmarketable for several different reasons:

Defects in the record chain of title (e.g., missing deeds, wild deeds, deeds from grantors who never appear to have owned).
Recorded encumbrances (e.g., mortgages, restrictive covenants, easements, options) that the buyer has not agreed to accept.
Existing violations of zoning or covenants, or significant encroachments.

Note the interaction between recording problems and marketable title:

A recorded instrument outside the chain of title (like a wild deed) does not give record notice, so a subsequent BFP may prevail in a priority dispute.
But if the defect is within the seller’s apparent chain—for example, a deed from a grantor who never appears to have received title—that uncertainty itself can make the title unmarketable, because a reasonable buyer faces a real risk that someone else could later claim ownership.

If title is unmarketable, the buyer must:

Give the seller notice of the defect; and
Allow a reasonable time to cure, even extending the closing date if necessary.

If the defect cannot be cured, the buyer may rescind, recover any earnest money, and (in many jurisdictions) seek damages or specific performance with an abatement.

Worked Example 1.4

O conveys Blackacre to A in 2000, but the deed from O to A is never recorded. In 2010, A conveys to B, who records. In 2020, O’s heir H purports to convey Blackacre to C, who records and contracts to sell to D. D’s title search reveals:

A deed from O to H;
A deed from H to C; and
A deed from A to B.

D insists that the title is unmarketable. Is D correct?

Answer:
Yes. The record shows that O’s heir H purported to convey, but there is no recorded deed from O to A or from O to H. The presence of B’s recorded deed from A creates a serious question about who actually owns. Even if C might ultimately win a litigation, the uncertainty in the chain creates a reasonable risk of suit, rendering title unmarketable. D can refuse to close unless the defect is cured (for example, by quiet title).

Worked Example 1.5

O conveys to A, who records. Later, A conveys to B, who does not record. B takes possession and builds a fence. A then conveys again to C, a purchaser who never inspects the property but checks the records, finds only O–A and A–C, and records. In a notice jurisdiction, who has priority, and is C on inquiry notice?

Answer:
B has priority. Although C is a purchaser for value, she has inquiry notice: B’s possession and improvements are visible facts inconsistent with A still owning the property. A reasonable purchaser would inspect before buying; that inspection would reveal B’s interest. Because C is charged with inquiry notice, she is not a BFP and cannot rely on the notice statute to defeat B.

Exam Warning

In MBE questions, always check (1) whether the subsequent claimant is a purchaser for value, (2) whether she had any form of notice (actual, record, or inquiry) at the time of conveyance, and (3) whether the deed that supposedly gives notice is actually in the chain of title. Wild deeds, late recordings, and deeds recorded before the grantor had title often appear as traps.

Revision Tip

If you see a question about a "wild deed," remember it does not provide constructive notice. Only deeds properly connected to the chain of title count for record notice purposes. Then ask whether there is any other form of notice (actual or inquiry) that might defeat BFP status.

Summary

The chain of title is the backbone of real property ownership in recording-act problems. Recording acts modify the common-law “first in time” rule to protect bona fide purchasers, but only when they meet statutory requirements and when prior claims are properly reflected in the chain of title. Wild deeds, late recordings, and deeds recorded at the wrong time or from grantors who never appear in the chain do not give record notice, though they still affect the parties to those instruments.

At the contract stage, marketable title doctrine gives buyers protection against serious chain-of-title defects. On exam questions, separating priority (who wins the dispute under the recording act) from marketability (whether a buyer can refuse to close) is important. Always identify the jurisdiction’s recording statute, the timing and content of each recording, and whether each document would appear to a reasonable title searcher in the chain of title.

Key Point Checklist

This article has covered the following key knowledge points:

Chain of title is the sequence of recorded documents showing ownership history as it appears in the public index.
Recording acts (notice, race-notice, race) protect certain subsequent purchasers for value depending on notice and, in some statutes, on who records first.
Only bona fide purchasers—those who give value without notice—can invoke the protection of notice and race-notice recording acts.
Notice can be actual, record (constructive), or inquiry; record notice arises only from instruments properly in the chain of title.
Wild deeds are recorded but not in the chain of title; they do not give constructive notice.
Late recordings and deeds recorded before the grantor acquired title are usually outside the chain of title and can be ignored for record notice purposes.
References in a deed within the chain can create inquiry notice of other instruments, even if those instruments are not themselves properly in the chain.
The shelter rule allows those who take from a BFP to inherit the BFP’s protection, even if they themselves have notice or are donees.
Marketable title requires a clear, unbroken chain and the absence of undisclosed encumbrances; chain defects and serious encumbrances make title unmarketable.
On the MBE, separate questions of priority under the recording act from questions about marketable title under a land sale contract.

Key Terms and Concepts

Chain of Title
Bona Fide Purchaser (BFP)
Notice Statute
Race-Notice Statute
Race Statute
Actual Notice
Record (Constructive) Notice
Inquiry Notice
Wild Deed
Shelter Rule
Marketable Title

Titles - Chain of title