Request By:
Rosemary F. Center
Wolfe County Attorney
Campton, Kentucky 41301
Opinion
Opinion By: Steven L. Beshear, Attorney General; Charles W. Runyan, Assistant Deputy Attorney General
Your letter raises questions concerning Wolfe County right-of-way deeds which were, we assume, properly executed, were lodged for recording with the Wolfe County Clerk, but which deeds were never actually recorded in the Clerk's office.
Your letter reads:
"This letter is written to request an opinion regarding county right-of-way deeds. The present County Clerk has discovered a number of Wolfe County right-of-way deeds which were conveyed to Wolfe County during the 1950's. Apparently, these deeds were placed in a compartment of a safe located in the Clerk's office but were not recorded in a deed book, nor were they indexed.
A problem has arisen regarding the width of a county road for which the County Clerk has located a right-of-way deed; however, this was one of the deeds executed in 1953, which was not recorded in a deed book. The roadway has been used for many years and the problem relates to its width.
My first question is whether a particular right-of-way deed conveying 20 feet of roadway would be valid as to the present owner, since it was not recorded at the time he purchased the property. However, the deed was lodged in the Clerk's office at that time.
My second question is what is the proper procedure for the Wolfe County Clerk to follow regarding these deeds which he has discovered. Should he request the Fiscal Court for permission to record them and place an explanatory note in the margin of the deed book.
My third question is whether these conveyances would be binding on subsequent purchasers since the deeds would not be found in the chain of title."
As concerns the first question, from the facts given we believe the deed was a valid transfer and delivery of title and effective as between the grantor and grantee. See Nunn v. Justice, 278 Ky. 811, 129 S.W.2d 564 (1939); Howard v. Kelsay, 230 Ky. 61, 18 S.W.2d 884 (1929). Thus, assuming that there was a due execution, delivery and acceptance of the deed, the deed was valid as between the grantor and grantee. An unrecorded deed, if otherwise validly executed, delivered and accepted, is good against the grantor and his heirs. Kelly v. Bramblett, 26 Ky.Law Rep. 167, 81 S.W. 249 (1904). However, the deed, being unrecorded, is not valid as to a creditor or other purchaser without actual notice of the transaction. See KRS 382.110. In addition, KRS 382.270 expressly provides that no deed conveying a legal or equitable title to real property shall be valid against a purchaser for a valuable consideration, without notice thereof, or against creditors, until such deed is acknowledged or proved according to law and lodged for record. The courts have interpreted "lodged for record" as meaning where the deed is actually recorded. In Borg-Warner Acceptance v. First Nat. Bank, Ky.App., 577 S.W.2d 29 (1979) 32, the Court wrote:
"The effect of an unrecorded mortgage, otherwise valid, is described in KRS 382.270, which says that no unrecorded mortgage 'shall be valid against a purchaser for a valuable consideration, without notice thereof, or against creditors. . . .' [Emphasis added]. The language of the statute appears to impose the lack of knowledge requirement on purchasers, but not on creditors. However, Kentucky courts have consistently held that the no-knowledge requirement does indeed apply to creditors, since 'the creditor stands on the same footing as the purchaser. '"
Where a subsequent grantee or creditor has no actual knowledge or notice of such prior deed or has no information sufficient to put the subsequent grantee on inquiry that would lead to the discovery of the prior deed upon a search, the prior and unrecorded deed would not be valid against such creditor or subsequent grantee. See Turner v. McIntosh, Ky., 379 S.W.2d 470 (1964). An unrecorded deed would be valid and would prevail over a subsequent deed where the subsequent grantee knew or had notice of the unrecorded deed prior to the subsequent grantee's purchase, or had information sufficient to put him on inquiry that would have led to its discovery, such information being equivalent to notice. Hurley v. Hackney, 202 Ky. 452, 260 S.W. 16 (1924).
As to whether the subsequent grantee had actual notice or sufficient information to put him on inquiry that would have led to the discovery of the unrecorded deed is purely a factual matter which you may determine. If you or the County Judge Executive cannot determine the facts to your satisfaction, then it would be up to the courts to resolve it under the above judicial decisions. The principle of notice, as contained in KRS 382.110, makes no exception in the case of a deed to a governmental unit.
Your second question is what should the Wolfe County Clerk do about the deeds he has discovered. Where the deeds are correct in form (see KRS 382.110), and were duly executed and acknowledged (see KRS 382.130), and delivered, and accepted, they are recordable. The County Clerk should record such instruments, unless beforehand he receives an order of a court of law or the Fiscal Court not to record. See KRS 382.190. The date of the actual recording will speak for itself as it relates to third parties. Recording generally gives constructive notice to third persons. Billington v. Dunn, 217 Ky. 164, 289 S.W. 213 (1926). We know of no valid reason why the Fiscal Court would not want the deeds to be recorded.
Your third question is whether these conveyances to the county would be binding on subsequent purchasers. We have answered that above. The third party deeds which are presently of record would be valid, provided the subsequent grantees had no actual notice of the unrecorded deeds or had no information sufficient to put them on inquiry that would have led to the discovery of such deeds.
If there actually were county roads in existence, involving right-of-way within the description of these unrecorded deeds, at the time of the execution of the subsequent deeds to third parties, it would appear that such fact of county road existence would go a long way toward imputing to the subsequent grantees knowledge or notice of the existence of the county deeds or sufficient knowledge to place them on inquiry as would have led upon investigation to the discovery of the existence of the county right-of-way deeds. See Turner v. McIntosh, Ky., 379 S.W.2d 470 (1964).