March v. Pantaleo

California Supreme Court Aug 26, 1935 No. Sac. 4926Published

Before: Langdon

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Holding. The court held that the defendant was a bona fide purchaser for value without notice of the plaintiff's prior unrecorded deed of trust, as the defendant's inquiry into the property's title was reasonable under the circumstances.

Issues

Whether a subsequent purchaser who records first is a bona fide purchaser when they had knowledge of a prior satisfied debt but no notice of a subsequent unrecorded deed of trust.
Whether the defendant's reliance on public records after an inquiry into prior encumbrances constituted reasonable diligence.

Disposition. affirmed

Quotations verified verbatim against the opinion

“In view of the finding of the trial court that Griffin was a bona fide purchaser without notice, we cannot say that Taylor’s action was, as a matter of law, unreasonable.”

LANGDON, J.

This is an action to quiet title to a ranch near Riverbank, California. Vito Clarizio was the owner of the property prior to the transactions which led to the present controversy. He had previously, in 1925, borrowed money from plaintiff March, and given a deed of trust to

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.secure the loan. A reconveyance of the property was made, and on December 14, 1930, Clarizio executed a new deed of trust to plaintiff, to secure a loan of $650. The first of these deeds of trust was recorded, and the satisfaction and reconveyance thereof also appeared of record. The subsequent instrument was not recorded until much later.

In August, 1931, Clarizio retained defendant Edward T. Taylor of the law firm of Griffin & Boone to defend him on a criminal charge and agreed to the transfer of his ranch for the attorney’s fee. Accordingly, on August 21, 1931, Clarizio executed a deed to defendant Griffin. The defendant Pantaleo purchased the property from Griffin, giving a deed of trust for the $800 balance and receiving a quitclaim deed from Griffin dated September 1, 1931. Clarizio gave Pantaleo a grant deed dated the same day.

On September 12, 1931, at 9 A. M., the deeds from Griffin to Pantaleo and from Clarizio to Pantaleo were placed on record. At 9:58 A. M. of the same day the prior deed of trust from Clarizio to plaintiff March was recorded.

Thereafter plaintiff March proceeded to sell the property under his deed of trust, and purchased at the trustee’s sale. The present action followed, and the trial court gave judgment for the defendants, holding that defendant Griffin had purchased the property from Clarizio on August 21, 1931, for valuable consideration, without knowledge of any prior rights therein. Plaintiff brings this appeal. It is stipulated that the sale under the deed of trust was regular, and that defendants Taylor, Griffin and Boone were associated in the transaction and are bound by any notice or knowledge acquired by defendant Taylor.

The deed of trust to plaintiff March was prior in time, and would be prior in right save for the failure to record it. It is conceded that the deed to Griffin was first recorded, and that at the time of said recordation, no prior conveyance or encumbrance appeared of record. But Griffin’s right is superior to plaintiff’s only if Griffin is a

March v. Pantaleo

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LANGDON, J.

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