Also known as: title search · title searching · title examination
Written by attorneys — see sources below.
A systematic examination of public land records to identify the chain of title and any encumbrances affecting a parcel of real property. The examination reveals defects or liens that may impair marketability or require resolution before transfer.
Taliah Tang contracted to buy a commercial building. The title company performed a search two weeks before closing and found no encumbrances. Financing delays postponed closing by ten days. A judgment lien was recorded against the seller during the gap. The buyer closed without an updated search and later faced foreclosure proceedings on the undisclosed lien.
Trevor Tate and Theresa Tucker held property as joint tenants. Trevor executed a long-term lease on his interest. Upon Trevor's death the surviving tenant sought to quiet title. A title search revealed the lease in the joint tenant's chain but not in the survivor's direct chain of title. The search results forced litigation over whether the lease survived severance.
Raymond Johnson and plaintiff Hazel Tenhet owned a parcel of property as joint tenants. The deed was executed by Jettie N. Johnson to them as joint tenants. The property consisted of a dwelling house and lot. Its value did not exceed three thousand five hundred dollars at the time of Johnson's death in 1971. Assertedly without plaintiff's knowledge or consent, Johnson leased the property to defendant Boswell. The lease was for a period of ten years at a rental of one hundred fifty dollars per year. It included a provision granting the lessee an option to purchase. Johnson died some three months after execution of the lease. Plaintiff sought to establish her sole right to possession of the property as the surviving joint tenant. After an unsuccessful demand upon defendant to vacate the premises, plaintiff brought this action to have the lease declared invalid. The third amended complaint contained five causes of action. The trial court granted a motion to strike the fourth and fifth causes of action. It sustained demurrers to the second and third causes without leave to amend. But the court made no express ruling on the first cause of action seeking declaratory relief and damages. The trial court sustained demurrers to the complaint and entered a judgment of dismissal. Plaintiff appealed from the ensuing judgment of dismissal to the Supreme Court of California.
View caseTyler Taylor and Tabitha Taylor owned their home as tenants by the entirety. The IRS assessed taxes solely against Tyler. A title search conducted for a refinance revealed the federal tax lien indexed only under Tyler's name. The lender required the lien to be addressed before funding because the search showed potential attachment to the entire property.
In 1988, the Internal Revenue Service assessed $482,446 in unpaid income tax liabilities against Don Craft for his failure to file federal income tax returns for the years 1979 through 1986. At that time, Don Craft and his wife, respondent Sandra L. Craft, owned a piece of real property in Grand Rapids, Michigan, as tenants by the entirety. After notice of the federal tax lien was filed, the Crafts jointly executed a quitclaim deed purporting to transfer Don Craft's interest in the property to Sandra Craft for one dollar. When Sandra Craft later attempted to sell the property, a title search revealed the lien. The IRS agreed to release the lien to allow the sale on the condition that half of the net proceeds be held in escrow pending determination of the Government's interest. Sandra Craft then brought an action in the United States District Court for the Western District of Michigan to quiet title to the escrowed proceeds. The District Court granted summary judgment to the Government. On appeal, the United States Court of Appeals for the Sixth Circuit held that the tax lien did not attach to the property under Michigan law and remanded for consideration of the Government's fraudulent conveyance claim. On remand, the District Court found that the conveyance itself was not fraudulent but that the use of nonexempt funds to pay the mortgage constituted a fraudulent act, and it awarded the IRS a share of the proceeds. The Sixth Circuit affirmed that determination on the lien issue as law of the case. The Supreme Court granted certiorari to consider whether Don Craft had a separate interest in the entireties property to which the federal tax lien attached.
View caseTravis Tate agreed to purchase a former bank building for restaurant use. The title search disclosed a recorded deed restriction prohibiting drive-through service. The buyer negotiated amendments to the closing documents requiring removal of the restriction before closing. The search results shaped the final agreement on marketable title.
Threshold Capital retained counsel to handle acquisition of distressed real estate. The attorney arranged title searches through an affiliated company subject to a minimum-fee schedule. The buyer later challenged the arrangement as an antitrust violation affecting the cost and independence of the title examination. The search results themselves were accurate but the procurement method drew regulatory scrutiny.
In 1971 petitioners, husband and wife, contracted to buy a home in Fairfax County, Virginia. The financing agency required them to secure title insurance, which in turn required a title examination that only a member of the Virginia State Bar could legally perform. Petitioners contacted a lawyer who quoted them the precise fee suggested in a minimum-fee schedule published by respondent Fairfax County Bar Association, amounting to one percent of the value of the property. They then sent letters to thirty-six other Fairfax County lawyers requesting their fees for the title examination. Nineteen replied, and none indicated that he would charge less than the rate fixed by the schedule. The fee schedule is a list of recommended minimum prices for common legal services. The County Bar is a purely voluntary association of attorneys with no formal power to enforce the schedule. Respondent Virginia State Bar is the administrative agency through which the Virginia Supreme Court regulates the practice of law, and membership is required to practice in the state. The State Bar published reports condoning fee schedules. It issued ethical opinions indicating that evidence an attorney habitually charges less than the suggested minimum fee schedule adopted by his local bar association raises a presumption that such lawyer is guilty of misconduct. Because petitioners could not find a lawyer willing to charge a fee lower than the schedule dictated, they had their title examined by the lawyer they had first contacted. They then brought this class action against the State Bar and the County Bar alleging that the operation of the minimum-fee schedule as applied to fees for legal services relating to residential real estate transactions constitutes price fixing in violation of section 1 of the Sherman Act. After a trial solely on the issue of liability the district court held that the minimum-fee schedule violated the Sherman Act as to the County Bar but exempted the State Bar. The court of appeals reversed as to liability. The Supreme Court granted certiorari.
View caseAn attorney must order an updated title search when a known delay creates a foreseeable risk that new liens could be recorded. The duty arises from the attorney's obligation to exercise reasonable care under the circumstances rather than from any fixed time period or client request.
Supporting sources
A title search limited to the immediate grantor's chain of title does not provide constructive notice of interests recorded outside that chain. Instruments indexed solely under a prior owner's name fall outside the chain and do not bind a subsequent purchaser who searches only the relevant chain.
Supporting sources
A buyer may refuse to close when a title search reveals a gap in the chain of title because the gap renders title unmarketable. Marketable title requires freedom from reasonable doubt that a prudent purchaser would accept, and a missing deed creates precisely that doubt.
Supporting sources
…be “a conscientious effort to show lawyers in their true perspective of dignity, training and integrity.” The suggested fees for title examination were virtually identical to those in the State Bar report. In accord with Opinion 98 of the State Bar Committee on Legal Ethics the schedule stated that, although there is an ethical duty…