Real Property: The Recording System: Notice

3 forms of notice that a buyer may potentially be charged with (AIR):
  • Actual Notice
  • Inquiry Notice
  • Record Notice
Actual notice: Prior to B’s closing, B gets literal knowledge of A’s existence.

Inquiry notice: Whether he looks or not, B is on inquiry notice of whatever an inspection of the land would reveal.
  • The buyer of real estate has a duty to inspect before transfer of title, to see whether anyone else is in possession. If another is in possession, B is charged with inquiry notice of the fact, regardless of whether buyer actually bothered to inspect or not.
    • Thus, in the example, if A had taken possession, B would be on inquiry notice of that fact, thereby defeating B’s status as a BFP.
    • If a recorded instrument makes reference to an unrecorded transaction, grantee is on inquiry notice of whatever a reasonable follow-up inspection would have revealed.
Record notice: B is on record notice of A’s deed if at the time B takes, A’s deed was properly recorded within the chain of title.
  • In the example, what if A has not recorded, or has not recorded properly at the time B takes? Assume that B is a bona fide purchaser. Does B win?
  • It depends on which recording statute the jurisdiction has enacted. In a notice state, B wins. In a race-notice state, to win, B must be a BFP and must also win the race to record.