what every practitioner should know about the standards of

What Every Practitioner Should Know about the Standards of Title

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Lawyers’ Principles of Professionalism As a lawyer I must strive to make our system of justice work fairly and efficiently. In order to carry out that responsibility, not only will I comply with the letter and spirit of the disciplinary standards applicable to all lawyers, but I will also conduct myself in accordance with the following Principles of Professionalism when dealing with my client, opposing parties, their counsel, the courts and the general public.

Civility and courtesy are the hallmarks of professionalism and should not be equated with weakness; I will endeavor to be courteous and civil, both in oral and in written communications;

I will not knowingly make statements of fact or of law that are untrue;

I will agree to reasonable requests for extensions of time or for waiver of procedural formalities when the legitimate interests of my client will not be adversely affected;

I will refrain from causing unreasonable delays;

I will endeavor to consult with opposing counsel before scheduling depositions and meetings and before rescheduling hearings, and I will cooperate with opposing counsel when scheduling changes are requested;

When scheduled hearings or depositions have to be canceled, I will notify opposing counsel, and if appropriate, the court (or other tribunal) as early as possible;

Before dates for hearings or trials are set, or if that is not feasible, immediately after such dates have been set, I will attempt to verify the availability of key participants and witnesses so that I can promptly notify the court (or other tribunal) and opposing counsel of any likely problem in that regard;

I will refrain from utilizing litigation or any other course of conduct to harass the opposing party;

I will refrain from engaging in excessive and abusive discovery, and I will comply with all reasonable discovery requests;

In depositions and other proceedings, and in negotiations, I will conduct myself with dignity, avoid making groundless objections and refrain from engaging I acts of rudeness or disrespect;

I will not serve motions and pleadings on the other party or counsel at such time or in such manner as will unfairly limit the other party’s opportunity to respond;

In business transactions I will not quarrel over matters of form or style, but will concentrate on matters of substance and content;

I will be a vigorous and zealous advocate on behalf of my client, while recognizing, as an officer of the court, that excessive zeal may be detrimental to my client’s interests as well as to the proper functioning of our system of justice;

While I must consider my client’s decision concerning the objectives of the representation, I nevertheless will counsel my client that a willingness to initiate or engage in settlement discussions is consistent with zealous and effective representation;

Where consistent with my client's interests, I will communicate with opposing counsel in an effort to avoid litigation and to resolve litigation that has actually commenced;

I will withdraw voluntarily claims or defense when it becomes apparent that they do not have merit or are superfluous;

I will not file frivolous motions;

I will make every effort to agree with other counsel, as early as possible, on a voluntary exchange of information and on a plan for discovery;

I will attempt to resolve, by agreement, my objections to matters contained in my opponent's pleadings and discovery requests;

In civil matters, I will stipulate to facts as to which there is no genuine dispute;

I will endeavor to be punctual in attending court hearings, conferences, meetings and depositions;

I will at all times be candid with the court and its personnel;

I will remember that, in addition to commitment to my client's cause, my responsibilities as a lawyer include a devotion to the public good;

I will endeavor to keep myself current in the areas in which I practice and when necessary, will associate with, or refer my client to, counsel knowledgeable in another field of practice;

I will be mindful of the fact that, as a member of a self-regulating profession, it is incumbent on me to report violations by fellow lawyers as required by the Rules of Professional Conduct;

I will be mindful of the need to protect the image of the legal profession in the eyes of the public and will be so guided when considering methods and content of advertising;

I will be mindful that the law is a learned profession and that among its desirable goals are devotion to public service, improvement of administration of justice, and the contribution of uncompensated time and civic influence on behalf of those persons who cannot afford adequate legal assistance;

I will endeavor to ensure that all persons, regardless of race, age, gender, disability, national origin, religion, sexual orientation, color, or creed receive fair and equal treatment under the law, and will always conduct myself in such a way as to promote equality and justice for all.

It is understood that nothing in these Principles shall be deemed to supersede, supplement or in any way amend the Rules of Professional Conduct, alter existing standards of conduct against which lawyer conduct might be judged or become a basis for the imposition of civil liability of any kind.

--Adopted by the Connecticut Bar Association House of Delegates on June 6, 1994

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Table of Contents Agenda .................................................................................................................................................................................... 4

Faculty Biographies ................................................................................................................................................................ 5

What Every Practitioner Should Know about the Standards of Title Presentation ............................................................... 6

What Every Practitioner Should Know about the Standards of Title Summary ................................................................... 83

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What Every Practitioner Should Know about the Standards of Title (2020CLC‐RP02)

Agenda

I. Introduction 3 min II. Topics to be Discussed 3 min III. Overview of the Standards of Title 3min IV. Chapters V and VI Grantors and Grantees 4 min V. Chapter IX Execution, Witnessing, and Acknowledgement 5 min VI. Chapter XI Delivery 4 min VII. Chapter XIII Title Through Decedents' Estates 5 min VIII. Chapter XVIII Release of Mortgages 10 Min IX. Chapter XXIIII The Connecticut Succession Tax Lien 4 min X. Chapter XXIV Duration of Federal Tax Lien 4 min XI. Chapter XXX Common Interest Communities 5 min XII. Chapter 31 Leases 5 min XIII. Questions 5 min

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Faculty Biographies

David S. Veleber Attorney Veleber is a Senior Title Counsel in CATIC’s Hartford office. Prior to joining CATIC, he was in private practice primarily representing sellers, purchasers and lenders in real estate transactions. While at CATIC, he has prepared and presented numerous seminars and webinars on title-related matters. Attorney Veleber is a member of the Connecticut Bar Association’s Real Property Section and the Residential Real Estate Specialization Examination Committee. He is also active in the Connecticut Mortgage Bankers Association, serving on its Board of Directors and as a member of its Closing and Compliance Committee. Attorney Veleber is a graduate of Lehigh University and the University of Connecticut School of Law.

Bruce A. Zawodniak Attorney Zawodniak is a Senior Title Counsel in CATIC’s Hartford office. Prior to joining CATIC, he was in private practice where his primary focus was residential and commercial real estate closings, foreclosures, collections and representing common interest communities. At CATIC, Bruce has prepared and presented numerous seminars and webinars on title-related matters. He a member of the Connecticut Bar Association’s Real Property Section and the liaison to the CATIC Foundation, Inc. Attorney Zawodniak is a graduate of Trinity College and the University of Connecticut School of Law.

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WHAT EVERY PRACTITIONER SHOULD KNOW ABOUT THE

STANDARDS OF TITLE

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WHAT EVERY PRACTITIONER SHOULD KNOW ABOUT THE STANDARDS OF TITLE

2

Bruce Zawodniak David Veleber

SPEAKERS

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Connecticut Standards of Title:• Prepared by the Connecticut Bar

Association Standards of Title Committee• Address matters of general agreement on

title issues not expressly covered by statute or case decision

• Purchase from the Connecticut Bar Association: (860) 223-4400

Connecticut Standards of Title:• Prepared by the Connecticut Bar

Association Standards of Title Committee• Address matters of general agreement on

title issues not expressly covered by statute or case decision

• Purchase from the Connecticut Bar Association: (860) 223-4400

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Search Period to Establish Marketable Title Standards 2.1 and 3.2• Unbroken record title extending

back at least forty years

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• Marketable Record Title Act C.G.S. 47-33b -33l

• Chapter 3 of the Standards• Limit search period• Protect owners from risk

of ancient interests and defects by legislative nullification

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The Statutory Root of Title –Standard 3.4• Root Deed: at least 40 years ago• Effective the date deed is recorded• Statutory root includes:

• Warranty, Quit claim • Executor’s, Certificate of devise or

descent• Trustee’s, Conservator’s

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Grantors – Chapter 6

Self-Dealing Standard 6.5• Fool’s Gold:

Deed from fiduciary to himself/herself – Voidable

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Self-Dealing Standard 6.5Self-Dealing Standard 6.5• Fiduciary:• Administrator, Executor, • Trustee,• Holder of Power of Attorney

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Self-Dealing Standard 6.5Self-Dealing Standard 6.5• Title examiner may not pass on a self-dealing deed

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Self-Dealing Standard 6.5Self-Dealing Standard 6.5• Need record evidence of authority of

fiduciary to make conveyance• Does POA unconditionally allow self-dealing?• Consent, approval or ratification by person

fiduciary owed a duty• Approval by the court• 10 year validation – C.G.S. 47-36aa(d)

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Grantees – Chapter 7Grantees – Chapter 7

Capacity of Parties to Take Title as Grantees – Standard 7.1Capacity of Parties to Take Title as Grantees – Standard 7.1

• Lump of coal: Deed into Estate –no legal capacity to hold title

• Deed should be into Fiduciary –Executor

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Standard 7.3 – Deed into Estate validated after 2 years – C.G.S. 47-36aa(a)(4)

Standard 7.3 – Deed into Estate validated after 2 years – C.G.S. 47-36aa(a)(4)

Once validated, conveyance out from Estate.Once validated, conveyance out from Estate.

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Standard 7.1 - Conveyance to Minor or Incompetent is good.Standard 7.1 - Conveyance to Minor or Incompetent is good.

Need court appointed guardian or conservator to sell pursuant to court order.

Need court appointed guardian or conservator to sell pursuant to court order.

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Standard 7.2 –Conveyance to “A or B” does not vest title in either

Standard 7.2 –Conveyance to “A or B” does not vest title in either

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Execution, Witnessing and

Acknowledgment – Chapter 9

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• Omission/Inconsistency of Date of Execution does not impair marketability – Standard 9.1

EXECUTION:EXECUTION:

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• Grantor or Grantee cannot witness deed Standard 9.2

• (validated in 2 years)• Competency to testify is basic

requirement for any witness

WITNESS: WITNESS:

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• Party may not take acknowledgment –Standard 9.3

• (Validated in 2 years)• Corporate officer may

take acknowledgment of another officer

ACKNOWLEDGMENT: ACKNOWLEDGMENT:

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Deeds of Connecticut Land executed in another state – Standard 9.4

• Executed in conformity with the laws of that state

• Connecticut attorney can take acknowledgment

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Deeds of Connecticut Land executed in a Foreign Country –Standard 9.5

• Executed in conformity with Connecticut law• Notary or person recognized to take acknowledgment• Connecticut attorney can take acknowledgment• United States Embassy or Consulate

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Delivery Standard 11.1

• Delivered deed can be recorded after death of grantor

• Possession of a deed by grantee = delivery

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Affidavit of Facts Relating to Real Estate Affidavit of Facts Relating to Real Estate

Standard 12.1 C.G.S. 47-12aStandard 12.1 C.G.S. 47-12a

Used to clarify titleUsed to clarify title

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Affidavit of Facts Relating to Real Estate

• Death, family history, heirship• Names, identity of parties• Conflicts and ambiguities in description of

land• Event which may terminate an estate or

interest

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• Made by person having personal knowledge of the facts

• Prima facie evidence of truthfulness and accuracy of those facts

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•Include description of land and name of record owner for indexing purposes

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Title Through Decedents’ Estates Chapter 13

•Title passes at death to heirs•Need to establish marketability

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• Ten-year rule - affidavit of heirship

• Applies to testate and intestate estates

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• Beware: • 25-year standard regarding

inheritance tax lien – Standard 23.1

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Title Through Decedents’ Estates –Standard 13.4

• Executor with unlimited testamentary power can sell without the consent of the Specific Devisee

• Standard 13.4 Comment 2

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Title Through Decedents’ Estates –Standard 13.7

• Mortgage holder has died• Mortgage is personal property• Release of mortgage signed by

Fiduciary – Standard 13.7 Comment 2

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Chapter 14 – Co-Tenancies

Standard 14.1 – Co-Tenancies with Rights of Survivorship

Evidence of intent to create survivorship = survivorship

Dennen v. Searle 149 Conn. 126 (1961)

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• “Joint Tenants” (deeds post 1984) – See Standard 14.2

• “Unto the survivor of them”• “As Tenants in Common and unto the

survivor of them”• “As Tenants by the Entirety” (even if not

married) – See Standard 14.4

Look for:Look for:

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Chapter 18 – Releases of MortgagesChapter 18 – Releases of Mortgages

Standard 18.1 – The Doctrine of MergerStandard 18.1 – The Doctrine of Merger

• Anti-merger provision

Deed in lieu of foreclosureDeed in lieu of foreclosure

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• No need for a release unless the record affirmatively discloses an intent that the mortgage continue

Chapter 18 – Standard 18.1Chapter 18 – Standard 18.1

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Standard 18.3 – Release of Mortgage by One of Two or More Co-Mortgagees

• Any co-mortgagee can issue a release• Release should include language that

the underlying debt has been fully paid and satisfied

35

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Standard 18.4 – Irregularities and Discrepancies in Releases of Mortgage

• A release of mortgage is sufficient despite minor errors as to:• Dates• Amounts• Volume and Page• Property descriptions• Names of parties• Other information

36

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Standard 18.4 – Irregularities and Discrepancies in Releases of Mortgage (cont’d)

• Consider all circumstances of record to determine if sufficient data are given to identify the intended mortgage to be released

• Helpful: Avoid a corrected release for small errors

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18.5

Releases of Corrected, Re-Recorded or

Modified Mortgages

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Standard 18.5 – Releases of Corrected, Re-recorded or Modified Mortgage

• Generally, a release of a re-recorded mortgage needs to refer to the re-recorded mortgage, not just the original

39

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Standard 18.5 – Releases of Corrected, Re-recorded or Modified Mortgage (cont’d)

• Releases of a modified mortgage can refer to either the mortgage or the modification

40

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Standard 18.6 – Effect of Failure to Release Assignment of Rents, Lis Pendens or Financing Statement

• Unreleased Assignments of Rents and Financing Statements do not impair marketability if given as additional security for a mortgage and the mortgage has been released

41

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Standard 18.6 – Effect of Failure to Release Assignment of Rents, LisPendens or Financing Statement (cont’d)

• An unreleased lis pendens does not impair marketability if the underlying lien or mortgage has been released or the case is withdrawn

42

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Standard 18.7 – Effect of Unreleased Mortgages on Marketability of Title

• Three-part Standard (Standard 18.7A, 18.7B and 18.7C)• Each part has different criteria for its

use

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Standard 18.7 – Effect of Unreleased Mortgages on Marketability of Title (cont’d)

• Helps to provide marketability for certain unreleased mortgages• Used for non-institutional mortgages.• Cannot find the mortgagee to obtain

release

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18.8

Validation of a Release of Mortgage on a One- to Four-Family Property

Executed by a Person who is not the Record Holder

CGS § 49-9a

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18.8

If a release of (residential) mortgage is executed by a person who is not the record holder, it will be effective to release the mortgage if validation of the release under the provisions of C.G.S. § 49-9a has occurred. This has occurred only if:

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47

18.8

• the release is recorded at least 5 years before the date marketability is being determined;

• no action to challenge its validity has been brought and no notice of lis pendens has been recorded within 5 years of its recording;

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18.8

• an affidavit complying with C.G.S. § 49-9a is executed and recorded (record owner for at least 2 years);

• it is a release of a mortgage on one- to four-family residential property (including residential units in a common interest community); and

• the record holder of the mortgage at the time the release is executed is not an individual.

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18.10

Effect of Failure to Release a Multi-Town Mortgage

or

Other Encumbrance in All Towns where it was Recorded

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18.10

A mortgage or other encumbrance that was recorded in more than one town against either

• a single parcel of land lying in more than one town, or• a condominium unit located in a development which is

located in more than one town, • but which was released in fewer than all such towns,

does not impair marketability.

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Chapter 23 – The Connecticut Succession Tax Lien

• Standard 23.1 – The Connecticut Succession Tax Lien• Does not impair marketability if more than 25

years after death• Time limitation does not apply if an actual lien

has been filed by the State

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Chapter 24 – The Federal General Tax Lien

• Standard 24.3 – Duration of the Federal Tax Lien – Period of Limitation• Expires 10 years after Date of

Assessment listed on the tax lien• Can be extended if the IRS files an

extension on the land records

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Chapter 30 – Common Interest Communities

Standard 30.1 - Unit Descriptions• Unit descriptions under the Common Interest Ownership Act• require only 4 pieces of information

• An identifying unit number• The name of the common interest community• The recording data for the original declaration• The town in which the community is located

This Standard tracks C.G.S. §47-223

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Standard 30.6 – Failure to Record a Waiver of Right of First Refusal in Favor of the Common Interest Community Association

• Title is not impaired by the absence of a recorded waiver provided no action has been taken to enforce such right within 6 months following the sale

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Standard 30.6 – Failure to Record a Waiver of Right of First Refusal in Favor of the Common Interest Community Association (cont’d)

• More CIC’s have moved away from recorded waivers

• Usually in the resale certificate• Purchasers still need to verify the waiver

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Chapter 31

Parties in Possession and Leaseholds

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Chapter 31

31.1: Parties in Possession31.2: Expired Leases

31.3: Terminated Leases31.4: Purchase Options in Leases

31.5: Leasehold Interest in Common Interest Community Included in Deed Conveying Fee Interest

in Improvements31.6: Leasehold Encumbrances

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31.1

Parties in Possession

The rights of parties in actual or constructive possession constitute exceptions to the marketability of the title.

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31.1


Comment 1 – The land records do not constitute the exclusive repository of all claims or interests that may exist with respect to a parcel of land.

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31.1


Therefore, the examiner should take exception to the rights of parties in possession.

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31.2

Expired Leases

If a recorded lease or notice of lease sets forth a lease term, including any renewals or extensions thereof, that:• has expired as of the date of title examination and• the lease contains no purchase option; • a title examiner may pass title without exception for

such lease or notice.

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31.2

Expired Leases

It is important to recognize the difference between an expired lease and terminated lease.

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Agent Driven. Insuring Results.® 63

31.3

Terminated Leases

Marketability of the title to real property is notimpaired by a leasehold interest if:

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31.3

Terminated Leases

• evidenced by a recorded lease or notice of lease that sets forth a lease term, including any renewals or extensions thereof, that has not expired as of the date of title examination, or

• existing by virtue of a written but unrecorded lease, provided

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31.3

Terminated Leases

Provided in either case there is a recorded document, such as a lease termination agreement or a statutory affidavit pursuant to C.G.S. § 47-12a, by which the title examiner can reasonably conclude that the leasehold interest of the tenant has been extinguished and that the tenant is no longer in possession of the property.

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31.3

Terminated Leases

Comment 1: Tenant may have vacated but continues to pay rent. For that reason, require a recorded document that the lease has terminated.

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31.3

Terminated Leases

Comment 3 – Even if a new tenant is in possession and there is a recorded notice of lease for that new tenant, the termination of the original lease must be established.

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31.3

Terminated Leases

Comment 4 - Generally, a tenant is unable to terminate a lease unilaterally.The main exception lies in the area of bankruptcy law.

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31.4

Purchase Options in Leases

A recorded lease or notice of lease containing a purchase option does not impair marketability of title if all of the following conditions have been satisfied:

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31.4


a. The lease or notice of lease states that the purchase option may be exercised only while the lease remains in effect,

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31.4


b. At least 5 years have elapsed since the termination date stated in the lease or the notice of lease or any extensions thereof, whichever is latest,

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31.4


c. The tenant is no longer in possession or control of the demised premises, and

d. There is no record evidence, such as a notice of lis pendens, of the tenant asserting its purchase rights.

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31.5

Leasehold Interest in Common Interest Community Included in Deed Conveying Fee

Interest in Improvements

Marketability of title to real property within a common interest community consisting of both a fee interest in improvements and a leasehold interest in the land is not impaired if:• the leasehold interest was transferred by deed and

not by way of an assignment of the lessee’s interest.

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31.6

Leasehold Encumbrances

An unreleased mortgage or other encumbrance on a leasehold interest does not impair marketability of title to the fee if:• the leasehold has expired or has been terminated.

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31.6

Leasehold Encumbrances

Comment 2: The examiner must still take exception unless it can be verified that the lessee is no longer in possession.

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Thank YouSpecial Thanks to Beverly Ambulos and Colleen Lindroos

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What Every Practitioner Should Know About

the Connecticut Standards of Title Connecticut Legal Conference

September 2020

Presented by: David S. Veleber, Esq. and Bruce A. Zawodniak, Esq.

The Connecticut Standards of Title (published by the Connecticut Bar Association) is a very

important resource for real estate practitioners. The Standards are designed to help establish what

is, and is not, marketable title. These materials do not discuss every aspect of all of the Standards

but, rather, focus on the ones which are most commonly implicated by questions that title insurance

underwriters receive. We recommend that all practitioners read through all of the Standards, in

addition to the ones discussed here.

History:

The Connecticut Standards of Title is the work product of the Committee on Standards of Title of

the Connecticut Bar Association. The Standards date back to 1937, with significant revisions in

1980 and 1999 and updates in 2004, 2009, 2013, 2018, and 2019. The Standards address matters

of general agreement among Connecticut title lawyers on title issues not expressly covered by

statutes or case decisions, and many of the Standards include a scholarly analysis of case and

statutory law relating to a specific Standard. (L. Stewart Bohan, Chair of the Committee, Preface

to the 1999 edition)

The current edition of the Standards contains thirty-one (31) Chapters with comments and

examples. This compilation provides guidance on dealing with a variety of title matters including

use and operation of the land records, the Marketable Record Title Act, grantors, grantees, title

through decedents’ estates, use of affidavits, the Connecticut succession tax lien, the federal tax

lien, common interest communities, leases, and the ever-popular topic – releases of mortgages.

The Standards of Title is a hard-cover (loose-leaf) binder and is available for purchase from the

Connecticut Bar Association. (30 Bank Street, New Britain, CT 06050 / Telephone (860) 223-

4400) Members of the CBA’s Real Property Section have online access to the Standards.

Title Examiner (Chapter 1), The Use and Operation of the Land Records (Chapter

2), and The Marketable Record Title Act (Chapter 3):

These introductory Chapters of the Connecticut Standards of Title explain the role of the title

examiner, the use and operation of the land records, and the Marketable Record Title Act, and how

these concepts apply to everyday real estate practice. Chapters 2 and 3 discuss the period of time

needed to search title to establish marketable title.

A title search covering a period of at least forty (40) years is sufficient to establish title of real

property, provided that the basis of the chain of title is an instrument which meets the definition

of a “root of title” under the Marketable Record Title Act. (Standard 2.1) The Marketable Record

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Title Act (General Statutes Sections 47-33b – 47-33j) was adopted by the Connecticut legislature

in 1967. “The Act is curative in nature and extinguishes by operation of law most title interests,

claims and defects which pre-date a root of title as defined in the Act and which are not expressly

preserved by one or more deeds or instruments within an unbroken chain of title of forty or more

years from the root of title.” (Standard 2.1 Comment 1) The Act protects owners from the risk of

ancient interests and defects by legislative nullification of such claims and defects. (Standard 3

Introduction)

There are certain interests which the marketable record title is subject to (as set forth in Conn. Gen.

Stat. Section 47-33d), including a specific identification rather than a general reference (Standard

3.10), competing chains of title (Standard 3.12), adverse possession (Standard 3.13), easement

rights granted, excepted, or reserved by an instrument provided the existence is evidenced by a

physical object which need not be observable (Standard 3.14), and interests of the United States,

the State of Connecticut, and any political subdivision, and the interests of any public service

company or any natural gas company. (Standard 3.14)

The requisites of a Marketable Record Title set forth in Standard 3.2 are (1) an unbroken record

title to an interest in real property extending back at least forty years and (2) nothing appears upon

the land records in the chain of title of that property which purports to divest such person of title.

Standard 3.2 Comment 2 states: “A ‘marketable record title’ is not the same as a ‘marketable title.’

The two concepts are related but different in many ways. The former is entirely statutory in its

definition and application, whereas the definition and application of the latter depends entirely on

decisional law.”

There is a misconception that the statutory root deed of title must be a warranty deed. Deeds that

can serve as a statutory root of title include “a warranty, quit-claim, administrator’s, executor’s,

guardian’s, trustee’s, referee’s, conservator’s, tax collector’s or committee’s deed, a foreclosed

mortgage, a decree of court and the transfer of title by will or descent.” (Standard 3.4) The effective

date of the root of title is the date on which it is recorded (Standard 3.4). A Statutory Root of Title

means “that conveyance or other title transaction constituting the first or only link in the unbroken

record chain of title of a person to an interest in land.” (Standard 3.4)

Chapter 5 The Notice of Lis Pendens:

Adopted in 2004, this Chapter addresses the nature and scope of a notice of lis pendens. Lis

pendens means a pending lawsuit. A notice of lis pendens recorded on the land records is a warning

that title to a certain property is in litigation.

Standard of Title 5.1 states that any party who acquires an interest in the property after the

recording of a notice of lis pendens in the chain of title is bound by the final outcome of the pending

litigation if there has been proper service of the notice of lis pendens on the property owner. For a

title searcher, this means that the mere recording of a notice of lis pendens is not enough to

establish that a party thereafter recording an interest in the property is bound by the subsequent

proceedings in the lawsuit referred to in the notice. In those cases where there is a pending action,

the searcher must either establish that the notice of lis pendens was properly served on the property

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owner(s), or include a notation that the plaintiff’s counsel must be contacted to verify proper

service.

Standard 5.1 gives searchers a break by providing that if the notice of lis pendens has been recorded

for more than ten years, there is no need to establish that there has been proper service of the notice

of lis pendens, so long as the underlying lawsuit (including any appeal) is no longer pending.

Standard 5.2 addresses a notice of lis pendens recorded in a dissolution of marriage action. Any

person who acquires an interest in the property after the recording of the notice of lis pendens is

bound by the decree to the same extent as if that person had been made a party to the dissolution.

For example, “a post-lis pendens creditor will still have its interest extinguished if the dissolution

decree awards the subject property to the non-debtor spouse.” (Standard 5.2 Comment 1) In a

dissolution action, creditors have no standing to be made parties to the dissolution. [See Venuti v.

Venuti, 410 A.2d 1012, 36 Conn. Sup. 56 (1979)]. This is a contrast to a foreclosure action in

which post-lis pendens creditors can request to be made a party defendant. Conn. Gen. Stat. Section

52-325.

What happens when there is an unreleased notice of lis pendens on the land records? A release of

the mortgage clears the associated foreclosure lis pendens (Standard 18.6). Standard 5.3 titled

“Effect of Failure to Release Notice of Lis Pendens” states that an unreleased notice of lis pendens

does not impair marketability, if the underlying action referenced in the notice, including any

appeals therefrom, is no longer pending. Standard 5.3 Comment 2 provides: “Once the underlying

action has terminated, the notice of lis pendens becomes of no further force and effect.”

For example, in a dissolution action, Husband seeks an award of the real property and records a

notice of lis pendens against Wife which is properly served. The court enters a judgment of

dissolution and Husband is awarded the property. Wife conveys title to Husband. Title is

marketable in Husband without any requirement that the lis pendens be released. (Standard 5.3

Example 1)

A notice of lis pendens can automatically expire. Conn. Gen. Stat. Section 52-325e provides that

no notice of lis pendens recorded against any real property shall continue in force for a longer

period than fifteen years after the date such notice was recorded unless within the five years prior

to the expiration of said fifteen-year period such notice of lis pendens is re-recorded and a notice

of such re-recording is served upon the owner of record. (Standard 5.3 Comment 3)

Chapter 6 Grantors:

This Chapter covers conveyances from unincorporated associations (6.1), presumption of age of

majority (6.2) and presumption of mental capacity (6.3), conveyances by power of attorney (6.4),

and the most problematic conveyance – a deed from a fiduciary to such fiduciary as grantee (6.5),

commonly referred to as the Self-Dealing Standard.

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The prohibition against self-dealing by fiduciaries, reflected in Standard of Title 6.5, makes

conveyances from a fiduciary, e.g., an administrator, executor, trustee, or holder of a power of

attorney, to such fiduciary individually a voidable transfer.

The Standard states that a title examiner may not pass on such a recorded deed until there is record

evidence of consent, approval, or ratification on the part of the person to whom the fiduciary owed

a duty, or unless a court of competent jurisdiction has authorized the fiduciary to make the

conveyance. The instrument should expressly authorize self-dealing by the fiduciary and such

authority cannot be inferred. Standard of Title 6.5 Comment 2.

In the case of a conveyance by an attorney-in-fact, a careful drafting of the power of attorney can

avoid the title problem this situation normally creates. A power of attorney must simply include

unconditional language authorizing a transfer by the attorney-in-fact to the attorney-in-fact.

Because the power of attorney needs to be recorded on the land records, there will be record

evidence of the authority of the fiduciary to make the conveyance to himself/herself.

Without this additional authorization, the voidability of a subsequent self-dealing conveyance

cannot be eliminated without evidence of ratification or the passing of the ten-year statutory

validation period. Conn. Gen. Stat. Section 47-36aa(d). While ratification of the transfer may be

as easy as a confirming deed or affidavit when the principal is competent, solutions are more

difficult when the principal is no longer available. In cases where the principal has passed away,

however, a review of the decedent’s Will may show that the attorney-in-fact was bound to inherit

the property anyway and a document should be recorded to reflect that fact.

For deeds in which the trustee or the executor conveyed to himself or herself, the Trust or Last

Will and Testament must be reviewed to determine whether it included language authorizing the

self-dealing transfer. If so, an affidavit of facts containing the provision authorizing the self-

dealing should be recorded on the land records.

Validating Act: If a search reveals a deed where the fiduciary conveyed to himself and the deed

was recorded over ten years ago, then the deed is valid unless an action was commenced to set

aside the conveyance (evidenced by a recorded notice of lis pendens). Conn. Gen. Stat. Section

47-36aa(d). Note: The validating act will not cure the absence of a recorded, original power of

attorney pursuant to which an agent has purported to convey real property unless fifteen years has

passed from the date of the recording of such interest which states consideration reflecting fair

market value. Conn. Gen. Stat. Section 47-36aa(c).

Standard 6.2 Presumption re Majority: In the absence of actual or constructive notice to the

contrary, a title examiner may presume that an individual grantor identified in a recorded deed was

of full legal age at the time of the conveyance.

Comment 1. Minors fourteen years of age and under are incapable of contracting and lack capacity

to convey. They can act only through a duly appointed guardian. Beyond the age of fourteen, the

minor’s contract (or deed) is regarded as voidable. Bestor v. Hickey, 71 Conn. 181, 186 (1898).

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Comment 2. Since the deed of a minor over fourteen is merely voidable, and not void, such deed

does operate to transfer title to the grantee, subject to the minor’s right to avoid or disaffirm his deed

upon reaching majority. Kline v. Beebe, 6 Conn. 494, 499 (1827), Riley v. Mallory, 33 Conn. 201,

205 (1866).

Standard 6.3 Presumption re Mental Capacity: In the absence of actual or constructive notice to

the contrary, a title examiner may presume that an individual grantor identified in a recorded deed

was mentally competent at the time of the conveyance.

Chapter 7 Grantees:

This Chapter discusses the capacity of parties to take as grantees. “A deed or other conveyance to

a grantee not in existence at the time of the conveyance or which is not capable of holding title to

real property does not convey legal title.” (Standard 7.1 Comment 1) An estate is an example of

this rule. An estate is not a grantee recognized by the law as having the capacity to hold title to

real property. See Standards of Title, Standards 7.1, 7.2 and 7.3. The deed should be into the

fiduciary, such as the executor of the estate.

While it is common for attorneys to refer to an estate as though it exists as an entity, it is important

to understand that an estate is not a legal person for the purposes of acquiring or conveying title to

real property. Conversations about estates and executors often include statements such as “The

Estate will be selling the property at 100 Main Street” or “My client will be deeding the property

to the Estate” or “The Estate owns the property.” Such statements are fine in a colloquial sense,

but care should be exercised not to take the statements literally, as conveyances involving real

property should always be to the executor(s) and from the executor(s). They should not be to or

from “the estate.”

All is not lost, however, if one encounters in the chain of title a deed to “The Estate of Mary Jones.”

Under the “old” validating act, Special Act 99-7, “the trust” or “the estate” will be validated as a

grantee, and title will be confirmed in it, its successors and assigns, with regard to deeds recorded

on or before January 1, 1997. “The estate” will be similarly validated as a grantee with regard to

deeds recorded after January 1, 1997 and unchallenged for two years, under the “new” validating

act, Conn. Gen. Stat. Section 47-36aa. (Standard 7.3)

If “the estate” has been validated, the conveyance out should be by “the estate” rather than by the

executor of the estate. If the validating act has not operated to validate “the estate” as grantee, then

legal title to the property conveyed to the estate remains in the grantor, and another conveyance in

the form of a correcting deed from the same grantor would be required in order to obtain a good

title.

Deed to an Incompetent or Minor: A deed to an incompetent or minor is good. Typically, the

conveyance is a result of a certificate of devise or descent. However, only the court-appointed

representative of the incompetent (conservator) or minor (guardian) can convey the interest

pursuant to a probate court order. (Standard 7.1 Comment 5)

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Conveyance to A or B: “A conveyance of Blackacre to ‘A or B’ does not vest legal title in either

A or B, since Connecticut law does not recognize simultaneous, alternative estates in real property,

but either A or B may bring an action for reformation of the deed or for a reconveyance to ‘A and

B’ or to ‘A and B, with right of survivorship,’ in order to vest legal title as nearly possible in A or

B in accordance with the intention of the parties.” (Standard 7.2 Example 2)

Chapter 9 Execution, Witnessing and Acknowledgment:

Execution: The omission of, or inconsistencies in, the date of execution in a conveyance deed or

mortgage does not impair marketability. (Standard 9.1) Neither do inconsistencies in the recitals

or indication of dates of acknowledgment or recordation. (Standard 9.1)

Witnessing: A grantor or a grantee cannot witness a deed. (Standard 9.2)

An unwitnessed or improperly witnessed deed will be validated two years after the recording of

the deed unless an action challenging the validity of that instrument is commenced and a notice of

lis pendens is recorded in the land records within the two-year period. (Standard 9.2 Comment 5

and Conn. Gen. Stat. Section 47-36aa)

There is no age limitation on the qualification of a witness to a deed as long as the witness has the

necessary qualifications to testify in court. (Standard 9.2 Comment 1)

Acknowledgment: A party to an instrument may not take the acknowledgment although an officer

of a corporation may take an acknowledgment of another person who has executed an instrument

on behalf of that corporation. (Standard 9.3)

An unacknowledged or improperly acknowledged deed will be validated two years after the

recording of the deed unless an action challenging the validity of that instrument is commenced

and a notice of lis pendens is recorded in the land records within the two-year period. (Standard

9.3 Comment 6 and Conn. Gen. Stat. Section 47-36aa)

“A certificate of acknowledgment which omits the name of the grantor of the deed but which

certifies to the acknowledgment of the signer and sealer of the deed is a good acknowledgment.”

Hayden v. Westcott, 11 Conn. 129 (1835).

Standards 9.4 and 9.5 discuss the requirements for execution and acknowledgment of deeds of

Connecticut land executed in another state, territory or foreign country. A deed of Connecticut

land executed in another state in conformity with the laws of that state is valid. (Standard 9.4) A

Connecticut attorney can take an acknowledgment on an instrument pertaining to Connecticut real

estate executed in another state, territory or foreign country. (Standard 9.4 Comment 2 citing

Conn. Gen. Stat. Section 1-31a and Standard 9.5)

A deed of Connecticut land executed in a foreign country must be executed in accordance with

Connecticut law – currently, two witnesses and an acknowledgment. (Standard 9.5)

Acknowledgment may be taken at the United States Embassy or Consulate or by a person

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authorized to take acknowledgment in that country. The title and the official seal of the person

taking the acknowledgment should be affixed to the document along with a statement indicating

when the commission expires or whether the commission is indefinite.

Standard 11 Delivery:

A delivered deed can be recorded after the death of the grantor. Possession of a deed by the grantee

constitutes delivery. [Standard 11.1 Comment 1 citing Sweeney v. Sweeney, 126 Conn. 391, 395

(1940)]

Standard 12.1 Use of Affidavit of Facts Relating to Title to Real Estate:

Practitioners often encounter a deed in which a name is misspelled, or a course in the legal

description is omitted; or they cannot find a recorded document which evidences a party has passed

away. Conn. Gen. Stat. Section 47-12a was enacted to provide legislative sanction for the

admission into evidence of certain affidavits which recite facts relating to title or an interest in real

estate. (Standard 12.1 Comment 3) Affidavits have been widely used for the purpose of clarifying

land titles. (Standard 12.1 Comment 2) The statutory affidavit may relate to a variety of matters

including: names, identity of parties, death, family history, heirship, possession or adverse

possession, conflicts and ambiguities in description of land in recorded instruments, and the

happening of any condition or event which may terminate an estate or interest. (Conn. Gen. Stat.

Section 47-12a)

The affidavit must be made by a person having personal knowledge of the facts who is competent

to testify in court, and the affidavit must include a description of the land and state the name of the

record owner for indexing purposes. (See Standard 12.1 and Conn. Gen. Stat. Section 47-12a.) “It

should be kept in mind, however, that facts recited in such an affidavit are presumptive evidence

only of the truth of those alleged facts and are subject to rebuttal by opposing testimony or other

evidence. The importance of this statute to real estate attorneys, however, is that the facts recited

in such an affidavit are prima facie evidence of the truthfulness and accuracy of those facts…”

(Standard 12.1 Comment 3)

Chapter 13 Title Through Decedents’ Estates:

This Chapter addresses the various issues of clearing title through intestate and testate real estate.

Title to real estate automatically passes at death to the heirs of the decedent. (Standard 13.1)

However, there needs to be a recorded document on the land records establishing the marketability

of title of the inherited property. (Standard 13.1)

Chapter 13 provides a way, under certain circumstances, to clear title when the decedent has been

dead for more than ten years. It allows an affidavit of heirship made pursuant to Conn. Gen. Stat.

Section 47-12a to identify all of the heirs. The ten-year rule applies to intestate and testate

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situations. The Standards should be consulted to determine whether an affidavit can be utilized in

your particular circumstance.

Additionally, the real estate practitioner should be aware of the 25-year rule for inheritance taxes.

The decedent estate may still be subject to an inchoate inheritance tax lien. (Succession tax lien

for deaths prior to January 1, 2005 and the estate tax lien for deaths on or after January 1, 2005.)

The possibility of an inheritance tax lien does not render title to the property unmarketable where

more than twenty-five years have passed since the death of the decedent, even though there is no

evidence of clearance of the tax on the land or probate records. (Standard 23.1 and Standard 13.1

Comment 5)

On occasion, a title searcher, after examination of the land records and the probate court file, will

encounter a deed from the executor to a person other than the specific devisee, and wonder whether

the conveyance is marketable. “Title to specifically devised property conveyed by an executor

under an unlimited testamentary power to convey and without an order of the court of probate

authorizing such sale should be considered marketable, whether or not there has been written

consent of the specific devisees.” (Standard 13.4 Comment 2)

Another perplexing dilemma that title searchers and real estate practitioners encounter is how to

clear title of a mortgage when the mortgagee is deceased. When the mortgage holder has died, a

release must come from the fiduciary of the estate. “Since a mortgage owned by an individual is

considered personal property after the mortgagee’s death, the fiduciary of the mortgagee’s estate

is the only one who has the authority to release or assign a mortgage.” (See Standard 13.7

Comment 2 and Conn. Gen. Stat. Sections 49-11 and 49-12.) Another option may be to obtain a

release of mortgage from all of the heirs.

Chapter 14 Co-Tenancies:

Title insurers often receive questions from attorney agents as to whether co-tenants hold title

to the property in survivorship or not. Although the Connecticut statutes include a section on

joint tenancy (see Conn. Gen. Stat. §§ 47-14a through 47-14k), there are times when it is not

very clear as to whether there is survivorship.

Standard 14.1 titled “Co-Tenancies with Rights of Survivorship” states “A conveyance or

devise to two or more persons is effective to create an estate with an added right of survivorship

if the instrument expresses an intent to confer such right.” So, evidence in the body of a

document showing intent to create survivorship can be sufficient to actually create the

survivorship. This concept of the common law right of survivorship was expressed in the case

of Dennen v. Searle, 149 Conn. 126 (1961). In that case, the Connecticut Supreme Court held

that the intent of the “agreement” between the siblings was sufficiently expressed so as to create

an annexed right of survivorship. This was true even in the absence of a customary granting

clause.

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This Chapter gives other examples of language that creates survivorship. Some of those

examples are:

• Simply the words “as Joint Tenants” (in deeds executed on or after October 1, 1984)

– See Standard 14.2.

• “Unto the survivor of them”

• “As Tenants in Common and unto the survivor of them” – Standard 14.1 Example 3

• “As Tenants by the Entirety” (even if not married) – Standard 14.4

Chapter 16 Attachments and Judgment Liens:

Standard 16.1 titled “Attachments” deals with the manner of filing and perfecting an attachment.

This Standard discusses what is required to make the attachment valid and also how to address

potentially defective attachments.

Occasionally, a title search reveals an unreleased attachment. If there is pending litigation, the

attachment will need to be addressed as part of the closing. In some cases, the attachment may

have expired if it has been recorded for more than 15 years and there is no evidence of a judgment

lien subsequently being recorded. See Conn. Gen. Stat. § 52-327. Or, if the underlying case

resulted in a judgment that was converted to a lien within four months of judgment, then the

attachment merges with the judgment lien and no separate release of the attachment is necessary

if the judgment lien itself is released. If the judgment lien is recorded more than four months after

the date of judgment, then “the attachment has no further force and validity.”

When an inquiry into the status of the underlying action reveals that the plaintiff has received

satisfaction of the claim, or final judgment has been rendered against the plaintiff, or when for any

reason the attachment has become of no effect, the plaintiff or his counsel should file a release of

the attachment on the land records. Sometimes, for whatever reason, it may be difficult to obtain

the release of attachment from the plaintiff or plaintiff’s counsel. Comment 3 of this Standard

provides for a method to remove certain attachments where the underlying case is no longer

pending for various reasons. A party can seek a certificate from the clerk of the Superior Court

where the suit was made returnable.

The clerk’s certificate is described in Conn. Gen. Stat. §§ 52-322 and 324 and can be used if the

suit has been withdrawn, the plaintiff has been nonsuited, final judgment has been rendered against

the plaintiff, the suit was not returned to court, or the attachment has become of no effect for any

reason. This clerk’s certificate can be recorded in the land records where the attachment is filed

and will act to dissolve the attachment.

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Chapter 17 Mechanic’s Liens:

Standard of Title 17.1 titled “Scope of Inquiry re Mechanic’s Liens” addresses the impact of a

recorded mechanic’s lien on marketability. Occasionally, a title search will reveal that a

mechanic’s lien has been filed against a property. When a mechanic’s lien is found, depending on

the facts and the age of the lien, this Standard, based on Conn. Gen. Stat. § 49-39, outlines the

methods to establish marketability. There are three basic timeframes:

1. If the lien has been of record for less than one year and 90 days, notwithstanding the one-

year time limitation of Conn. Gen. Stat. § 49-39, the lien cannot be passed over before the

end of that one year and 90 days period. (See Comment 5 of Standard 17.1)

2. If the lien has been of record more than one year but less than ten years and no lis pendens

was recorded, the lien continues to potentially impair marketability subject to further

inquiry to see if the lien is extinguished for failure to comply with the time limitations of

Conn. Gen. Stat. § 49-39. Such inquiry can be made to the lienor but the lienor may not be

very willing to help by providing confirmation that no action was ever brought. In that

case, inquiry should be made to the court that would have proper jurisdiction to see if any

actions were filed or are pending. If there are no pending actions, the lien is extinguished

for failure to comply with the time limitations of Conn. Gen. Stat. § 49-39.

One other issue to address is to confirm that the property owner did not file an action to

discharge the mechanic’s lien under Conn. Gen. Stat. § 49-35a. The statute outlines the

process to bring such an action. The concern is that such an action tolls the one-year time

period outlined in Conn. Gen. Stat. § 49-39. So, inquiry also needs to be made to confirm

the property owner did not file his or her own action to discharge the mechanic’s lien.

3. If the lien has been of record for more than 10 years, it no longer impairs marketability.

This is the key point of Standard 17.1. There is no case or statute that actually says this. It

is really a determination that the likelihood of loss or litigation is very low after the passage

of this amount of time. Without this Standard, inquiry would need to be made into the

effect of any recorded mechanic’s lien.

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Chapter 18 Releases of Mortgages:

The release of a mortgage is one of the most common issues facing practitioners today. It seems

like every title search is coming back with some form of problem with a prior mortgage which

should have been released or was not properly released.

Standard 18.1, “The Doctrine of Merger,” addresses the issue of deeds in lieu of foreclosure and

the concept that the mortgage and the fee interest merge if the lender is given the fee title to the

property. Upon merger, there is no need for a release unless the record affirmatively discloses an

intent that the mortgage continue.

Many times, deeds in lieu of foreclosure may contain anti-merger language. In those situations,

the lender is attempting to avoid the merger because it wants the mortgage to survive in case there

are junior lienholders that it might need to foreclose out after it takes title.

Since merger is a matter of intent, the lender’s actions still need to be examined to determine if it

really meant for the mortgage to merge (even without specific anti-merger language). The true

evidence of the intent for the mortgage to merge is when the lender conveys the property out to a

third party. If the lender conveys without taking exception for the mortgage, the intent to merge is

complete and the mortgage is extinguished.

Additionally, we receive calls from agents inquiring about mortgages to two (or more) co-

mortgagees but the release is being signed by only one of them. This issue is addressed by

Standard 18.3 titled “Release of Mortgage by One of Two or More Co-Mortgagees.” Under this

Standard, any co-mortgagee can issue a release. The premise is that the mortgage terms state that

the mortgage shall be null and void if the debt is fully paid. As such, we suggest that the release

should include language that the underlying debt has been fully paid and satisfied.

Sometimes there are minor errors or discrepancies in the mortgage release received from the

lender. These minor errors are generally not a problem. Standard 18.4 titled “Irregularities and

Discrepancies in Releases of Mortgage” discusses this issue and describes when a release is still

sufficient despite these minor errors.

A release of mortgage is sufficient despite minor errors as to:

- Dates

- Amounts

- Volume and Page

- Property descriptions

- Names of parties

- Other information

You have to consider all of the circumstances of record to determine if sufficient data are given

to identify the intended mortgage to be released. This Standard will help you avoid the need to

go back to the lender to request a corrected release for small errors.

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Standard 18.5 titled “Releases of Corrected, Re-recorded or Modified Mortgages” addresses

issues that arise when a mortgage has been corrected, re-recorded or modified. This Standard

outlines when a release of a re-recorded mortgage is sufficient to release the mortgage

completely.

Usually, mortgages are corrected and re-recorded because either a page or rider was left off or

there was an error in the execution of the document. When a mortgage is re-recorded to correct

an error, a note should be typed on the face of the mortgage to explain the reason for the

rerecording. This also helps to establish that the new recording is a re-recording of the original

mortgage and not a new mortgage evidencing a new note. We get calls frequently regarding

searches where there is a re-recorded mortgage and a release, but the agent is unsure if the release

is sufficient.

Under section A of the Standard, if the mortgage is re-recorded for the stated purpose of

correcting or modifying a previously recorded mortgage, and the two mortgages purport to

secure the same indebtedness, a release of the later mortgage is deemed sufficient to release both

mortgages. However, a release which references only the original mortgage is not sufficient to

release the later mortgage.

Under section B of the Standard, if the re-recording is to simply correct a deficiency in the

execution, attestation, or acknowledgement of the original mortgage, a subsequent release which

refers to either will be sufficient to release the mortgage.

Section C states: “Where a recorded mortgage deed is an obvious re-recording of a previously-

recorded mortgage and there is no discernible difference between the earlier-recorded and later-

recorded mortgages, a subsequently recorded release which makes reference to either the original

mortgage or the mortgage as re-recorded shall be deemed a sufficient release of both instruments.”

Finally, under section D, where the mortgage has been modified by a mortgage modification

agreement, a release which refers to either the mortgage or the modification agreement will be

deemed sufficient to release the mortgage.

Many times, agents receive searches which continue to show unreleased assignments of rents

and UCC-1 financing statements. This is addressed by Standard 18.6, titled “Effect of Failure

to Release Assignment of Rents, Lis Pendens or Financing Statement.” According to this

Standard, unreleased Assignments of Rents or Financing Statements do not impair marketability

if given as additional security for a mortgage and the mortgage has been released. So, although

they might not be released of record, title is marketable if the underlying mortgage has been

released.

Unreleased lis pendens also often show up in title searches when they actually no longer have an

impact on marketability. An unreleased lis pendens does not impair marketability if the underlying

lien or mortgage has been released or if there has been a final judgment in a foreclosure action or

the case has been withdrawn or dismissed (without being reopened). So, a separate release of lis

pendens is not necessary, although it is always preferable to get a release when possible to

eliminate any later questions.

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Standard 18.7, “Effect of Unreleased Mortgages on Marketability of Title,” was added to the

Standards to try to provide another method by which to clear up certain mortgages. This Standard

provides for three different affidavits. Which one may be used depends on who the affiant is,

how much time has passed, and what evidence is or is not available. An affidavit made and

recorded under this Standard does not operate to release the mortgage. It simply puts of record

facts evidencing that the possibility of the mortgagee making a claim for payment is so remote

that the title should be considered marketable even though the mortgage remains unreleased.

Each affidavit must meet the statutory criteria of Conn. Gen. Stat. § 47-12a and, in addition,

the criteria specific to each type.

1. The first affidavit, prepared under Standard 18.7A, requires the following:

• The mortgage must be at least five years old.

• The affiant must be a mortgagor, a personal representative of a mortgagor such as

a trustee or conservator, or the fiduciary of a mortgagor’s estate.

• Diligent efforts must have been made to locate the mortgagee, without success, and

the affidavit must so state.

• There must be a statement that the mortgage was paid and documentary evidence

of full payment attached. The documentary evidence need not be as extensive as

that required by Conn. Gen. Stat. § 49-8a, but must be conclusive of payment made

and received.

2. The second affidavit, prepared under Standard 18.7B, requires the following:

• The mortgage must be at least ten years old.

• The affiant must be a mortgagor. This form of affidavit does not allow for a

fiduciary or personal representative to sign.

• Diligent efforts have been made to locate the mortgagee, without success, and the

affidavit so states.

• A statement that the mortgage has been paid in full but that the affiant has no

documentary evidence of payment.

• A statement that the affiant has been in undisturbed possession of the property for

at least six years after the payment of the mortgage and prior to making the affidavit.

The lack of documentary evidence of payment is the reason why the affiant must be the

mortgagor and must make the unqualified statement under oath that the mortgage was paid.

It is also the reason for the increased time period.

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3. The third affidavit, prepared under Standard 18.7C, is for use by an owner of the

encumbered property who is not a mortgagor. The affiant’s title is encumbered by a prior

owner’s mortgage, so the affiant is unlikely to know unequivocally that the mortgage was

paid or to have evidence of payment. Accordingly, the third affidavit requires the

following:

• A mortgage that was recorded at least twenty years ago.

• A statement that the property remains encumbered by the mortgage and identifies

the mortgage by parties, date and recording date.

• A statement that the affiant is the owner of the property but not a mortgagor.

• A statement that diligent efforts have been made to locate the mortgagee or a

fiduciary of the mortgagee’s estate, without success.

• A statement that the affiant believes, in good faith, that the mortgage was paid.

• A statement that the affiant has been in undisturbed possession for at least six years

after the maturity date of the mortgage and before making the affidavit, without

claim or demand for payment.

This affidavit relies principally on passage of time to establish marketability, and on the

inability to locate the mortgagee. It is an affidavit that tracks the requirements of a petition

to discharge a mortgage brought pursuant to Conn. Gen. Stat. § 49-13.

4. It is important to note that, in general, none of the affidavits provided for in this

Standard can be used for a mortgage to a lending institution or mortgage company.

Even if the original lender is no longer doing business, it will usually have a successor,

sometimes through acquisition and merger, sometimes through FDIC’s receivership. The

successor institution can usually be identified through the Banking Department of the state

in which the institution was based or through websites that maintain information on failed

and merged financial institutions. Some of the available websites are:

www.ffiec.gov, the Federal Reserve System site;

http://www.fdic.gov, the FDIC site;

www.payoffassist.com or www.laneguide.com, both of which require a subscription.

Standard 18.8 concerns the “Validation of a release of mortgage on a one-to-four-family property

executed by a person who is not the record holder.” This new Standard allows the validation of

certain improper releases of mortgages pursuant to Connecticut General Statutes Section 49-9a,

and states: “Even though a release of mortgage is executed by a person who is not the record

holder, it will be effective to release the mortgage if validation of the release under the provisions

of Conn. Gen. Stat. Section 49-9a has occurred…only if: (i) it is recorded at least five years before

the date marketability is being determined; (ii) no action to challenge its validity has been brought

and no notice of lis pendens has been recorded within five years of its recording; (iii) an affidavit

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http://www.ffiec.gov/

http://www.fdic.gov/

http://www.payoffassist.com/

http://www.laneguide.com/

complying with Conn. Gen. Stat. Section 49-9a is executed [The affiant has been the record owner

for at least two years prior to the date of the affidavit] and recorded; (iv) it is a release of a mortgage

on one- to four-family residential property (including residential units in a common interest

community; and (v) the record holder of the mortgage at the time the release is executed is not an

individual.”

Standard 18.9 Home Equity Conversion (Reverse) Mortgage Loans Unreleased HUD Second

Mortgage: “The Home Equity Conversion Mortgage (HECM) loan program is administered by the

U.S. Department of Housing and Urban Development (HUD). HECM loans are but one form of

reverse mortgages. This Standard addresses only HECM mortgages. Typical HECM loan closing

documentation includes a first note and first mortgage in favor of the HUD-approved first

mortgage lender and a second note and second mortgage in favor of HUD. The two notes may

secure different debts. Therefore, the HUD note, and the mortgage securing it, cannot be

considered satisfied by the payment of the first note and release of the first mortgage. Title remains

unmarketable until the second mortgage on the subject property is released of record.”

Comment 1 states “It is rare that HUD advances any funds under its second note. However, under

the HECM program HUD may advance funds to the borrower under its second note if the first

mortgage lender fails to perform its obligations under its loan documents and fully advance funds

due the borrower. It is this possibility that leaves title unmarketable until the second mortgage is

released.”

Standard 18.10 Effect of Failure to Release a Multi-Town Mortgage or Other

Encumbrances in All Towns Where It Was Recorded

“A mortgage or other encumbrance that was recorded in more than one town against (a) a single

parcel of land lying in more than one town, or (b) a condominium unit located in a development

which is located in more than one town, but which was released in fewer than all such towns, does

not impair marketability.

Comment 1. It is unnecessary for the title searcher to make inquiry regarding an unreleased

mortgage or other encumbrance unless the record affirmatively discloses an intention that the

mortgage or other encumbrance continue to remain of force or effect.

Comment 2. If the unreleased mortgage or other encumbrance is a “blanket” encumbrance

affecting multiple parcels of land, whether contiguous or noncontiguous, then it must be released

of record in every town in which a parcel is located.

Comment 3. When a unit in a condominium is located in one town, but the common elements

allocated to said unit are located in an adjacent town, a release of a mortgage or other

encumbrance recorded only in the town in which the unit itself is located does not impair

marketability. If the release is only recorded in the town where the common elements are located

and not in the town where the unit is located, then it is recommended that a certified copy of the

release so recorded be obtained and recorded in the town in which the unit is located but failure

to do so does not impair marketability.”

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Chapter 19 Foreclosure of Mortgages and Liens:

This Chapter discusses the various title issues that may arise in the course of foreclosure of

mortgages and liens. Often there are defects in the various documents prepared and recorded as

part of the foreclosure process. Although sometimes such defects can impair the marketability of

the title, other times the errors are minor and do not impair marketability.

One such situation is outlined in Standard 19.2 titled “Effect of Errors in a Statutory Certificate

of Foreclosure.” It is important to remember that a certificate of foreclosure is not a muniment of

title. It is not like a deed. It does not actually pass title. The certificate is simply a notice to the

world that a particular mortgage or lien has been foreclosed and points the title searcher to a

particular court action. The actual foreclosure judgment is the muniment of title and determines

the proper party in whom title vests.

Since it is the judgment (and the passing of the law days) that actually transfers the title, errors in

the certificate of foreclosure do not impair marketability. This is why an actual review of the

foreclosure court file is so important when your client is buying property from a party that obtained

its title through a foreclosure action.

We periodically get calls from attorneys and lenders (usually out-of-state lenders) who want

releases for liens which were part of a foreclosure action. They want to know why certain liens

have not been released of record. Standard 19.3 titled “Failure to Release Mortgages and Other

Interests Involved in a Foreclosure Action” addresses these concerns.

Marketability is not impaired by failure to release of record the lien which was foreclosed or any

other lien which was extinguished by the foreclosure. So, although there are no recorded releases

of the liens which were part of the foreclosure, this Standard outlines that no such releases are

necessary in order for title to be marketable. This is true even if the foreclosure would leave a

deficiency.

Chapter 20 Corporate Conveyances:

Corporations are often involved in real estate transactions. Sometimes, a corporation’s existence

may have terminated by dissolution or by forfeiture but the corporation continues to hold title to

property in the corporate name. Agents often inquire if anything special has to be done when

buying from such a corporation. Standard 20.3 titled “Conveyance by a Corporation Whose

Existence Has Terminated” addresses these concerns. A corporation continues to act as a

corporation for the purpose of winding up its affairs. This includes selling any interest in real estate

it owns. So, corporations can still convey real estate even if terminated or dissolved if it is being

done as part of the winding up of the business. The amount of time between the dissolution and

the conveyance is immaterial.

As for the conveyance itself, the form of the deed and the execution thereof are the same as before

termination. The deed does not need to make any reference to the status of the corporation.

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Chapter 23 The Connecticut Succession Tax Lien:

Whenever a person dies owning an interest in Connecticut property, there is an inchoate tax lien

as a result of that death. Up until January 1, 2005, Connecticut had the succession tax under Conn.

Gen. Stat. § 12-340 (which has now been replaced by the estate tax). Under the succession tax,

there is a statutory lien against the property owned by the decedent from the date of death until

paid.

We still see many title searches which reveal an inchoate succession tax lien related to the death

of a person who died before January 1, 2005 and for whom no probate was opened and no tax

clearance obtained. Often, this is due to the misunderstanding that nothing needs to be done in

probate court for property held by joint tenants. Unfortunately, the issue usually arises shortly

before the closing is to take place (since the surviving spouse is often unaware that anything should

have been done) or after the surviving spouse is also deceased and the property is now being sold

from an estate.

According to Standard 23.1 titled “The Connecticut Succession Tax Lien,” there is a time

limitation on how long this inchoate lien will impair marketability. If more than twenty-five years

have passed since the devolution of title resulting from the death of the owner of the property

interest, “the mere possibility of a succession tax lien shall not render that title unmarketable, even

though neither the land records nor the probate records, if any, evidence determination or payment

of a succession tax.” So, if the person has been dead more than twenty-five years, no succession

tax clearance is necessary.

Even though tax clearance may not be needed because of the passage of the twenty-five-year

period, this does not mean the person’s death does not need to be evidenced on the land records.

The release of succession tax lien served two purposes when it was recorded. It told the world that

the person was dead and that no taxes were due. Often, in joint tenant situations, not only was tax

clearance not obtained but nothing even evidencing the party’s death was recorded. In that

situation, some evidence still needs to be recorded even if tax clearance is not needed. That can be

either a death certificate or an affidavit of facts.

This twenty-five-year time limitation does not apply if the State has filed an actual lien against the

decedent or the property. Such a lien has no expiration and it will need to be addressed if one is

found recorded in the land records.

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Chapter 24 The Federal General Tax Lien:

A federal general tax lien arises whenever a person fails to pay, after demand, any federal tax for

which the person is liable. Any such lien is a lien in favor of the United States against any real

property owned by the taxpayer and it arises as of the date of assessment.

When a title search reveals a federal tax lien recorded in the name of the taxpayer who is purporting

to sell a property, the lien must be reviewed to determine if it is still a valid lien against the

taxpayer. Please remember that the lien is against any interest of the taxpayer, not just the address

that might be stated on the lien. So, if the lien states it is against John Smith (with the stated last

four digits of his social security number) with an address of 123 Main Street, but the same John

Smith also owns 567 Oak Street and that is what you are buying, the lien will still need to be

addressed as part of the closing because the lien attaches to everything John Smith owns.

Standard 24.3 titled “Duration of the Federal Tax Lien – Period of Limitation” outlines the

duration of the lien and when it no longer impairs marketability. The lien become unenforceable

unless a collection is initiated within 10 years from the date of the assessment of the lien or prior

to the expiration of any extension(s) of the lien. This is supported by Section 6502(a) of the

Internal Revenue Code.

So, when you find a federal tax lien on the land records, the key date to look for is the date of

assessment, not the date of recording. This is column (d) on the form. The lien expires 10 years

from that date, which expiration date is stated in column (e). The lien states on its face that it

expires on the date listed in column (e) unless an extension is filed on the land records. So, you

could have a lien filed in 2013 for a tax assessed in 2009. Although the lien has not been of record

for 10 years, since the date of assessment was in 2009 the lien will have expired and can be written

over assuming no extensions have been filed.

Chapter 30 Common Interest Communities:

This Chapter addresses many common issues which arise regarding common interest communities,

such as condominiums, planned communities, and cooperatives.

Standard 30.1 titled “Unit Descriptions” addresses the issue of what is required for a valid legal

description for a unit in a common interest community. Many times, historic legal descriptions for

units can be very long and include a lot of information, including all of the amendments and

references to allocated interests. Sometimes the description takes up a full page. This Standard,

which tracks the statutory language of Conn. Gen. Stat. § 47-223, outlines that the unit descriptions

under the Common Interest Ownership Act require only four pieces of information:

1) An identifying unit number

2) The name of the common interest community

3) The recording data for the original declaration

4) The town in which the community is located

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We occasionally receive questions about this short form legal description, especially when a

drafter of a deed has converted the existing long form description to the shorter statutory form.

Although the long form descriptions are fine and just as valid, and many sellers’ attorneys want to

give out only the same thing the seller took in, converting to the statutory form of description is

acceptable and just as effective to convey title.

In addition to questions about legal descriptions, we get calls regarding the need for waivers of

right of first refusal by the association and whether those waivers need to be recorded on the land

records. Standard 30.6, “Failure to Record a Waiver of Right of First Refusal in Favor of the

Common Interest Community Association,” addresses this situation.

The Standard states that title is not impaired by the absence of a recorded waiver provided no

action has been taken to enforce such right within six months following the sale. That being said,

the Standard also goes on to state that this Standard is not based in statute. There is no such

statutory limitation. The premise behind the Standard is that the association will be well aware of

the transfer within that timeframe and will have ample opportunity to raise objection to any sale.

As for whether the waiver of right of first refusal needs to be recorded, more common interest

communities have moved away from recorded waivers. Although some still provide the waiver in

recordable form, most do not. Most commonly, you will see the waiver as just a note in the resale

certificate. As long as the association, either directly or through its property manager, states the

association’s intention to waive the right of first refusal, the requirement to obtain the waiver has

been met. Even if the waiver is in recordable form, it does not need to be recorded to make the title

marketable. Simply having the waiver clears the condition and fewer people want to spend the

money for recording fees to record the waiver. Notwithstanding whether the waiver needs to be

recorded, the Standard still contemplates that the buyer needs to make sure the seller has obtained

a waiver.

Chapter 31 Parties in Possession and Leaseholds:

This Chapter contains six standards: 31.1 Parties In Possession; 31.2 Expired Leases; 31.3

Terminated Leases; 31.4 Purchase Options in Leases; 31.5 Leasehold Interest in Common

Interest Community Included in Deed Conveying Fee Interest in Improvements; and 31.6

Leasehold Encumbrances.

Standard 31.1 Parties In Possession

“The rights of parties in actual or constructive possession constitute exceptions to the

marketability of title.”

Comment 1 states that “the land records do not constitute the exclusive repository of all claims

or interests that may exist with respect to a parcel of land…. The title examiner should take an

exception … to the rights of parties in actual or constructive possession.”

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Standard 31.2 Expired Leases

“If a recorded lease or notice of lease sets forth a lease term, including any renewals or extensions

therefor, that has expired as of the date of title examination, and the lease contains no purchase

option, a title examiner may pass title without exception for such lease or notice.”

Comment 2 notes that it is important to recognize the difference between an expired lease and

one that has been terminated; the requirements for passing title over a terminated lease are

different, as discussed in Standard 31.3.

Standard 31.3 Terminated Leases

“Marketability of title to real property is not impaired by a leasehold interest (A) evidenced by

a recorded lease or notice of lease that sets forth a lease term, including any renewals or

extensions thereof, that has not expired as of the date of title examination, or (B) existing by

virtue of a written but unrecorded lease, provided in either case there is recorded on the land

records a document, such as a lease termination agreement or a statutory affidavit pursuant to

C.G.S. Section 47-12a, by which the title examiner can reasonably conclude that the leasehold

interest of the tenant has been extinguished and that the tenant is no longer in possession of the

property.”

Comment 1 states that it is not enough that the examiner is able to determine that the tenant is

no longer in possession, since it is quite possible that a tenant may have vacated the premises but

continues to pay rent and keep the lease in effect. For that reason, the Standard imposes a second

requirement that information regarding the termination be recorded by a statutory affidavit or

perhaps a certified copy of a summary process decree.

Comment 4 notes that “Generally, a tenant is unable to terminate a lease unilaterally. The main

exception to that rule, of course, lies in the area of bankruptcy law….”

Standard 31.4 Purchase Options in Leases

“A recorded lease or notice of lease containing a purchase option does not impair marketability

of title if all of the following conditions have been satisfied: (a) the lease or notice of lease states

that the purchase option may be exercised only while the lease remains in effect, (b) at least five

years have elapsed since the termination date stated in the lease or the notice of lease or any

extensions thereof, whichever is latest, (c) the tenant is no longer in possession or control of the

demised premises, and (d) there is no record evidence, such as a notice of lis pendens, of the

tenant asserting its purchase rights.”

Standard 31.5 Leasehold Interest in Common Interest Community Included in Deed

Conveying Fee Interest in Improvements

“Marketability of title to real property within a common interest community consisting of both

a fee interest in improvements and a leasehold interest in the land is not impaired if the leasehold

interest was transferred by deed and not by way of an assignment of the lessee’s interest.”

As set forth in the Comments, this Standard addresses the frequently encountered so-called

“hybrid” common interest communities, where the unit owner’s interest consists of fee

ownership of a building (or portion thereof) coupled with a leasehold interest in the land. A

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tenant transferring a leasehold interest customarily does so by way of an assignment of that

interest, and not by means of a deed. On occasion, a transferor will use a form of deed which

neglects to include words of assignment with respect to the leasehold interest . Black’s Law

Dictionary, 9th edition, defines “assignment” as “The act by which one person transfers to

another…. the whole of the right, interest, or property which he has in any realty or

personalty…..” This definition is clearly broad enough to encompass a transfer of an interest in

a leasehold. Applying the foregoing precept, the inclusion of a leasehold interest within a deed

operates as a valid transfer of the leasehold interest, even though the deed does not expressly

make reference to the grantor’s assignment of the leasehold.

Standard 31.6 Leasehold Encumbrances

“An unreleased mortgage or other encumbrance on a leasehold interest does not impair

marketability of title to the fee if the leasehold has expired or has been terminated.”

Comment 1 states, “The validity of a leasehold mortgage is dependent on the continued existence

of the lease that constitutes the security. If that lease has expired for any reason, so also has the

security ceased to exist.”

Comment 2 cautions that “Where the leasehold encumbrance is on a lease that appears to have

expired by its own terms, the title examiner must still take exception for the encumbrance unless

he can verify that the lessee is no longer in possession, since any extension of the lease, even if

only by oral agreement, would cause the leasehold encumbrance to remain in effect.”

Conclusion:

The Connecticut Standards of Title is full of helpful information and commentary on how to

address many common problems that arise with titles. If you have any questions regarding the

Standards of Title, please contact us at:

[email protected] or [email protected]

Thank you and stay safe.

David Veleber, Esq. and Bruce Zawodniak, Esq.

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