Owner A received and recorded a deed to a California property in January 2024. Owner B later received a deed to the same property in March 2024, paid fair market value, recorded the deed immediately, and had no actual or constructive notice of Owner A's prior deed at the time of purchase. Under California's race-notice recording statute, which owner prevails?
Correct Answer
B) Owner B, because Owner B recorded first and had no notice of Owner A's prior deed at the time of purchase
California is a race-notice recording state under Civil Code §1214. A subsequent purchaser prevails over a prior unrecorded interest only if three elements are all satisfied: (1) the subsequent purchaser paid value (i.e., is a bona fide purchaser), (2) the subsequent purchaser had no actual or constructive notice of the prior interest at the time of purchase, and (3) the subsequent purchaser recorded first. Owner B satisfies all three elements — paid fair market value, had no notice of Owner A's deed, and recorded before Owner A — and therefore prevails.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Constructive notice is the legal presumption that a person has knowledge of information that is available through public records or visible inspection of the property, regardless of whether they actually knew about it.
A deed is a written legal document that conveys (transfers) ownership of real property from one party to another. It must be delivered to and accepted by the grantee to be effective.
For a deed to be valid, it must contain several essential elements including a competent grantor, identifiable grantee, consideration, legal description, granting clause, signature of the grantor, and delivery and acceptance.
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A California property seller asks the escrow officer about the Preliminary Change of Ownership Report (PCOR). The escrow officer explains that the PCOR is required to be filed:
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