Summary of Messersmith v. Smith, Supreme Court of ND (1953)
Parties: Nephew of owner (Frederick Messersmith) (seemingly concurrent owner with aunt through inheritance) v. subsequent purchaser from aunt (Smith). Is Seale also DF?
Cause of action/remedy sought: The following is an equitable action to quiet title.
Procedural History: Trial court found that the deeds were not procured through fraud or false representation. This court denied a petition for rehearing.
Facts: Caroline and Frederick were each the owner of an undivided ½ interest in the property having acquired it by inheritance. Some time before May 7, 1946, Caroline and Frederick Messersmith were record title owners. On May 7, Caroline executed and delivered a quitclaim deed to Frederick; recorded July 9, 1951.
On April 23, 1951, Caroline executed a lease to Herbert B. Smith Jr.; recorded on May 14th, 1951. Smith, King & his wife went to Messersmith to negotiate for the oil & gas lease covering the 3 sections of land.
On May 7, 1951, Caroline conveyed to Herbert Smith by mineral deed containing a warranty of title, a ½ undivided interest in all of the oil, gas and other minerals in or under or that may be produced upon the land. The deed was recorded May 26, 1951. Smith claimed the deed was acknowledged at Messersmith’s home by a notary public. There was an error in the deed in that it stated his heirs instead of her and so Smith tore up the deed and executed another one. The notary called Caroline over the phone for acknowledgment.
On May 9, 1951, Herbert executed a mineral deed conveying ½ interest in all the oil, gas and other materials in and under or that may be produced upon the land. The deed was recorded on May 26, 1951 and conveyed to Seale.
Seale answered Messersmith’s complaint by saying that he was a purchaser without actual or constructive notice of the PL’s claim. PL replied by a general denial and further alleged that the mineral deed by which Seale claimed title was void and that it was never acknowledged, not entitled to record and was obtained by fraud, deceit and misrepresentation.
Seale claimed that under a North Dakota statute, he had superior title to Messersmith (it was a race-notice statute). Seale in other words wanted statutory title.
Issue(s): Under ND property law, did Smith, as a subsequent purchaser for value, have valid title to the land conveyed to him by PL when the
Holding: No. The certificate of acknowledgment on the deed to Smith is not conclusive of the fact of actual acknowledgment by the grantor.
Court’s Rationale/Reasoning: First, the court addresses the issue that Caroline had void title, then the court looks at the fact that Seale asserts he is a bfp but negates this by using the North Dakota statute which says that acknowledgment is a condition precedent for recording title. Here, the 1st deed which was acknowledged was torn up for error and the 2nd was not. Thus, even though Seale may say he is a bfp, the statutory requirements for recording of the title were not met.
Since Caroline had conveyed to Frederick, she had no title. Seale has to rely upon his position as an innocent purchaser. Before a deed to real property can be recorded, there must be acknowledgment (acknowledgment is a condition precedent). Caroline did not appear before the notary and acknowledge that she executed the deed that was recorded. Thus, since Smith’s record was not entitled to be recorded (since it was not acknowledged), Seale was not a purchaser for good faith and valuable consideration pursuant to the North Dakota statute (although there is evidence that the 1st deed might have been recorded, Seale’s title is dependent upon the instrument that was recorded and not the one destroyed).
Rule: ND statute: the deposit and recording of an instrument proved and certified according to the provisions of the law are constructive notice of the execution of such instrument to all purchasers and encumbrances subsequent to the recording.
The recording of an instrument affecting the title to real estate which does not meet the statutory requirements of the recording laws affords no constructive notice.
Did court avoid issues?: No.