What is a quiet title action? To put it very simply, a quiet title action is a legal proceeding used for one of two purposes: (1) it can be used to fix or “cure” a title issue; or (2) it can be used to settle a dispute over the ownership of real property. The best way to protect yourself is to educate yourself. Before making an irreversible decision, make sure you understand the following quiet title topics.
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A quiet title action is all about the “chain of title” to real property.
Each time real property moves from one owner to another, a new link is created in the “chain of title” to real property. A very strict set of rules governs how a new link can be created. These rules ensure that the true owner of the property can be identified at any time by an examination of public records, thereby preventing false claims of ownership. In order for a system of private property rights to function properly, there must be stability and certainty as to the ownership of real property. If there is the slightest doubt or confusion as to ownership, title companies will not issue title policies and buyers will not buy. In other words, the chain of title must be fully intact.
A quiet title suit may be necessary when the chain of title is broken.
The chain of title can be broken when the rules for transferring real property are broken. Many times, it may be quite clear who actually owns the property, and yet the chain of title has technically been broken. Other times, there may be an outright dispute over ownership of the property. Here is an example of how the chain of title can be broken, even when everyone knows who really owns the property:
Suppose Great Grandpa died owning the Family Farm, and he did not have a written will. Instead, his kids just divided up the Family Farm based on his oral instructions. However, record title was still held by Great Grandpa. A few years later, the kids sold the Family Farm to a neighboring landowner. The neighbor did not require a formal title check, so he did not discover that record title was still held by Great Grandpa. Not only that, the kids drew up the deed themselves, and they accidentally left out a 10-acre tract of land in the middle of the Family Farm. Twenty years later, the neighbor died. Just like Great Grandpa, the neighbor did not have a formal will. Instead, he simply told his wife that she would inherit the Family Farm. At this point, the neighbor’s wife decided to sell the family farm to a real estate developer. The developer ran title work and discovered: (1) record title was still in Great Grandpa’s name; (2) the 10-acre tract was missing from the legal description; and (3) the neighbor never formally transferred title to his wife. In other words, there were several defects in the chain of title. The real estate developer cannot receive marketable title or obtain a title insurance policy on the Family Farm until these defects are cured.
How does the chain of title get fixed?
So, what is a quiet title action? It is a legal tool used to repair the chain of title in situations like the one described above. The developer could likely fix all of his title problems at once with a quiet title action. In the quiet title petition, the developer’s attorney would describe all of the title defects. He would ask the ask the judge to cure these defects with a court Order declaring that the developer is now the true owner of the Family Farm. The judge’s final Order would be filed in the county property records, and the Order itself would become a link in the chain of title. Later on, if the developer sells the Family Farm, the buyer’s title company would locate the quiet title Order in the public records, confirming that the developer is the true owner of the Family Farm.
A quiet title action is a real lawsuit.
Many times, a quiet title action is simply used to cure a title defect and does not involve any actual conflict between parties. However, a quiet title action is a real lawsuit, with real plaintiffs and defendants. When you file a quiet title lawsuit, you are actually suing someone. (That said, a quiet title lawsuit is primarily focused on property ownership and rarely includes a claim for money to be paid by one party to another.) The defendants in a quiet title lawsuit are anyone and everyone who may claim an ownership interest in the subject property. When the lawsuit is filed, potential claimants receive notice and have a chance to assert an interest in the property. If they do not assert an interest, they forever lose the right to do so, and their claim of ownership goes away. However, if they do assert an interest, there could be a legal dispute over ownership. For this reason, a quiet title attorney should be careful to explain the lawsuit in a way that minimizes the possibility of a dispute. Although quiet title lawsuits are often used to cure non-adversarial title defects, they can also be used to settle ownership disputes. When two parties each claim ownership of the same real property, a quiet title action is the appropriate legal tool to settle the dispute.
Do you really need a quiet title, or is there a better alternative?
Choosing the wrong legal tool can make a costly title problem even more costly. Sometimes, a title defect can be fixed by locating a key person and asking them to sign a curative instrument, such as a quit claim deed. Other times, an ownership dispute can be settled by private agreement. These methods can be faster and cheaper than a quiet title action. If your title issue relates to a deceased person, a probate or ancillary probate might be the most appropriate legal tool. If you are lucky, you can fix your problem without a quiet title or a probate.
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Other important quiet title topics: