The "Ins & Outs" of a Correction Deed

[Lee Hixson]

Strange...though I've been licensed since 1980 I have never had the chance to "fix" a discovered hiatus or overlap. This might change, however, and before I approach my client I would like to run past the group what I think my plan should be. This is all about a new R. of S. that I'm doing; my client wanted his north line marked, due to a disagreement over the current fence location.

Situation: a block inside a fully developed, older part of a smaller, norcal city. The original city map was done in 1856, creating 8 equal-sized lots separated by a 20' alley running through the center. My lot fronts the alley and has 4 adjoining neighbor lots, all of which (yikes!) are "portions" of the original lots, via metes & bounds descriptions tied to those old lots.

Surprise! Three out of the 4 adjoiners have either a hiatus or an overlap, all due to classically bungled descriptions with insufficient "calls" that could have saved any problems. The differences range from 0.5' to 1.5'.

I see 3 possibilities:

1. Assumption: all 4 owners agree to cooperate and fix the problems. Set up a meeting with everyone. Explain the situation. Show them my working RofS map. Suggest that a title company prepare new prelims on each of the lots and determine the order of seniority. Since the differences are minor, redraw the map to reflect senior lines, show it to the group, and if everyone is agreeable go ahead and mark my client's corners. Then record the map showing "Lot A," Lot B," and "Lot C" as designators for the adjoining parcels. Prepare new contracts with the 3 adjoining owners to cover my costs in preparing new legal descriptions for them, said descriptions simply referring to the Lots per the now recorded survey map. Have the title company record the new deeds, taking care of any trust deed modifications. If any of the other owners want their corners marked, do so and document them with Corner Records referencing the RofS.

Presumably, due to the minor discrepancies, the new deeds would be "Correction Deeds" and thus not run afoul of the Map Act, local agency LLA rules, or anything else. But, A) is this a correct assumption, and B) would the new deeds have "Correction Deed" as the title, or would they just be regular Grant Deeds?

2. One of the owners does not want to do anything at all. Proceed as above, but the map would show the remaining discrepancy, flagged as either a “hiatus” or an “overlap.”

3. None of the adjoiners want to participate. Have my client pay for a chain search for Jr/Sr rights monument his corners accordingly. File the map showing all of the discrepancies. Then, either my client can just live with the issues, or he can seek legal advice on what to do next.

Any advice or comments would be appreciated.

Lee

[Jim Frame]

If it were me, I'd go straight to Option 3. Getting four different land owners to agree to modify anything about their land ownership without being able to show them the situation as it currently stands seems like such a long shot that I wouldn't bother trying.

Assuming that the descriptions and not current occupation represent the best available evidence of the intent of the parties at the time of transfer, I'd survey the parcels according to seniority and file a ROS showing the relationship between the parcel lines and improvements. If there are significant discrepancies in that regard, I'd note prominently on the ROS that unwritten transfer(s) of title may have occurred that are beyond the scope of the survey. That might help ward off a slander of title suit from a disgruntled neighbor.

I'd then present the ROS to my client and advise him of options for resolving any discrepancies between written title and occupation (e.g., LLA, quiet title action).

I'm not sanguine about the "Lot A, Lot B..." concept. That looks an awful lot like trying to effect a merger and resubdivision with a ROS, and I can't imagine the County Surveyor greeting the effort with any enthusiasm.

I'd also make sure that any deed transfers that happen post-survey get handled by a title company, with my only participation being the provision of descriptions and plats. I wouldn't want the liability for something like a Prop 13 tax consequence should title get mucked up in the deed.

Good luck!

.

[mpallamary]

I would not recommend suggesting anything is being "corrected." Technically, these sound like a "reformation." I do believe this creates a SMA problem as you also have to include any lenders as they have an interest in these lines. You cannot "correct" a deed someone else has an interest in without their permission. In other words, if there were a foreclosure, what would be the extent of their senior claim? This is from an earlier post:

What you are referring to is called "reformation." Section 3399 of the Civil Code provides, "When, through fraud or a mutual mistake of the parties, or a mistake of one party, which the other at the time knew or suspected, a written contract does not truly express the intention of the parties, it may be revised on the application of a party aggrieved, so as to express that intention, so far as it can be done without prejudice to rights acquired by third persons, in good faith and for value."

It is well settled that the remedy of reformation is equitable in nature and not restricted to the exact situations stated in section 3399. (Demetris v. Demetris (1954) 125 Cal.App.2d 440, 443.)

If I was you and if there are no disputes between the parties and no reason to contest your conclusions and opinions, you should seek to "reform" or correct the deed. I would consult with a title company and get their concurrence and then obtain the consent of the affected parties.

The law provides a process and remedy for mistakes and errors as everything does not have to be litigated.

See: http://californiasurveyors.org/clsaforu ... -2486.html

If there is uncertainty, you can also apply the Doctrine of Agreed Boundaries.

In any and all cases, filing an ROS at the end of the day is a wonderful idea. What I would also do is place certain uncontested monuments and then remove all unacceptable monuments, all of which is documented on the ROS.

Good luck

[Lee Hixson]

Thanks, guys, for the good advice. And thanks for the articles. Time to mull things over a bit.

After talking with my client yesterday, he doesn't want to contest the hiatus; rather, he wants me to monument his slide of the sliver and be done with it. This is the sliver that is zero gap at the alley, widening out to 1.5' in the back. He's happy to claim up to his side of the sliver because it is still giving him more of the empty (unfenced) space between the two houses than he thought he had.

The rear third of the P/L does have a fence, and it is 3' further inside my client's parcel (further away from the gap sliver) so he feels like he's coming out ahead. I need to probe further into the nature of this fence, who built it, when, etc.

By the way, is there anything wrong with posting up a preliminary pdf of the as yet unsubmitted map?

[mpallamary]

I think it is a great idea to submit a draft. I do that oftene when I can use some input from others.

Good luck.

[Lee Hixson]

I think it is a great idea to submit a draft. I do that oftene when I can use some input from others.

Good luck.

Cool...here it is.

[Lee Hixson]

So I decided to just do the chain of title research myself. After 5 hours at the Recorder's Office I finally track down the creation deeds. My client is junior to some, senior to others, resulting in solved overlaps on the south side, but the hiatus at the NW corner remains. Added more notes (thanks to some of the comments in this thread) and revised the two sheets.

Thanks again, for all your input.

[VANCE]

Your county surveyor's PLs # is 334 and still practicing, that's one for the record books. LOL

[Lee Hixson]

Oops! That will shortly become, 3634. (I'm sure he would have caught THAT one.) :)

[land butcher]

On a similar note.
Years ago I had a woman call to survey her lot. It was about 8-10 sides. Small lot in some sort of patio home subdivision from the 60s.
Anyway, when she bought it the title company left a whole line of description out of her deed, about 3 courses.
When I gave her my fees, she gasped and said no thanks. I told her to contact the title company and have them fix her deed. Don't know if she ever did.
Anyone else run across something like that, and how was it fixed.

[Anthony Maffia]

I had a deed that read something like "Beginning at a point 1 60.72 feet from..." The past 3 deeds had a space, and the distance was 1160 feet, not 160 feet. Everyone kept the space in the legal description!

I retyped the description with the correct number, and pulled the earlier 1960s era deeds to prove the error. The client brought them to the county recorder and filed his own correcting deed, from himself to himself. There is actually a check box on the deed for "correcting a legal description."

[Lee Hixson]

So I decided to Google "reformation deed" this morning. The first couple of sites I checked both agreed that a reformation deed is synonymous with a correction deed. Then I happened across this amazingly comprehensive, impressively authoritative, site that I wish I had known about years ago.

As an aside, back when I got my license (1980) I did my research at Ticor title company in downtown Yuba City. This place was a beehive of activity. At any given time, besides employees using the plant, there were always 2 or 3 real estate people (or other people with similar interests) conducting research.

At first, when I needed to check for Jr./Sr. rights I would ask one of the title officers (that's right...they had more than one TO...nowadays, this same company has no onsite TOs, much less a plant) to help me find what I needed. They would go to their index and then pull the appropriate Arb book and track down the deed I needed.

After a while, they got used to me being there. Once I knew their system I was graciously allowed (a sort of unofficial promotion) to carry on with my own research. They enjoyed this. I was in their hair less, and there were many times they would ask me about survey related issues. A classic quid pro quo where knowledge was exchanged among professionals and everyone came out the better for it.

Then the title industry started going downhill. A year ago this company (the name was changed numerous times over the years) not only got rid of their plant (shipped it off to Roseville), but got rid of their title officers as well. Now, no one is allowed to use the plant in Roseville. Twenty, even ten, years ago I could have determined Jr./Sr. rights for my 4 parcels, using their plant, in an hour or less. Forced to do it the long way (at the Recorder's Office) it took me 5 hours.

So yeah, you could say they were only being smart in privatizing their plant, and then charging me $300-$400 to do what I could have done myself. But they've killed off that invaluable quid pro quo in the process. Now, the tech level people in the local office only know how to work at a computer, and don't even know what you're talking about when you say you need a chain of title search done.

Anyway (sorry for the long story), back in the days they had this blue paperback book called the "Title Handbook." It was a 400-page gem of a book that was printed for their title officers and contained a summary of all their underwriting principles. They referred to it constantly. But it was secret. They would let me flip through it, but making copies, or borrowing it? Forget it. It was a wealth of information that they would never part with.

So when I found this website, my first thought was that I must have accidentally hacked into it. Being more comprehensive, and far easier to use, and available online, this can't be true, can it?

It's the Stewart Virtual Underwriter website:

http://www.virtualunderwriter.com/

My first search yielded:
_______________________________

After an adequate legal description has been drawn (generally as the product of a survey), the most utilized methods in curing boundary problems are the following:

* Proper judicial proceedings

* Execution and recording of certain real estate documents:

Boundary line agreements

Quitclaim Deeds

Correction Deeds

Reformation Deeds
______________________________

Next I searched for "correction" and got this:
______________________________

A correction deed, correction mortgage, or reformation deed is an instrument executed by the former grantor of an instrument that contains a certain defect or deficiency, or by said grantor's heirs, representatives, or assigns for the purpose of correcting or amending a mistake or defect contained in the instrument.

The location of the error or defect to be corrected may be either within the body of the instrument itself or in its acknowledgment. The nature of the error may consist of matters that:

* Do not allow the instrument, though recorded, to impart constructive notice.
* Do not properly define the property or the interest being conveyed.
* May produce doubt or confusion as to the time of execution or the names of the parties.

The title examiner must be aware that the scope of utilization of a correction deed, correction mortgage, or reformation deed is extremely limited.

Any subsequent deed or mortgage under the guise of being a correction or reformation deed or mortgage, cannot purport to make a substantial change in the name of the grantee, decrease the size of the premises, alter the term or quality of the estate conveyed, or add a restriction or a condition. In no manner may the grantor, through the correction deed, correction mortgage, or reformation deed, intend to vacate, supersede, or replace the former instrument.

For any substantial change in the instrument to be effective, recorded evidence of the consent of the grantee is necessary.

Usually, in the event of a mutual mistake in regard to the legal description of the property, and if the parties agree to its correction, it is practical for the grantee in the defective instrument to execute a new conveyance.

If you are asked to update a policy by virtue of a corrective deed or mortgage, you must check title to date, and if there are intervening equities or liens, show them as exceptions in Schedule B or dispose of them prior to issuance.
__________________________

So now I have to concede that the title industry hasn't gone completely downhill. :) But the collaborative opportunities are virtually nonexistent anymore. Water cooler chats about deeds and surveys? Forget it.

Forgive me if the above link is a dup, but I don't recall any previous posts about it. I am going to bookmark this site, and expect to be going there quite often. Enjoy.

[mpallamary]

Excellent!

I have that manual and I think it is scanned now. As part of my cataloguing for www.tiepoints.com, I have been collecting these. What I have been doing is finding them through eBay searches and occasionally Amazon. I periodically go through these and then acquire these books. I then scan them and place them in my library. If I got this one scanned, I will send it over. If not, I will scan it and make it available. We may also be providing this at www.lsacts.com. Either way, it is a great book and although old and someone antiquated, it provides great direction as well as educating one as to how the title companies handled and still handle many of these sorts of claims.

Your note brought back many memories of better days.

[land butcher]

Nice link.
A quote from a friend that used to be a CFO for a title co.
"If you knew how little we pay those people you would be surprised they can do what they do."
Nice to know my title policys are in good hands.

[Lee Hixson]

My first clue as to the beginning of the decline? It was around 1985 and my boss and I were talking to a big developer about a new project, and when we asked him which title company he used, he said he had recently started using two different ones. Every new property that he considered, he ordered two reports from two companies, as a hedge against the rising number of mistakes they made.