Real Property MBE Tip of the Day
Welcome to our MBE tip of the day series. This post focuses on a Real Property MBE question.You will see 25 scored Real Property MBE questions on the Multistate Bar Exam. Note that we have posted several MBE tips (which you can find links to at the bottom of this post) that focus on a specific multiple-choice question that many students answer incorrectly. If you can master these questions, it could increase your MBE score by that many points if you see any of these issues tested again (which, by the way, you will!). These posts of MBE tips and tricks will not only cover substantive law but also strategy. So each MBE post covers one highly-tested area of substantive law as well as an important MBE strategy. You can sign up to receive these posts directly to your inbox for the upcoming administration at the bottom of this page.
MBE Tip of the Day Instructions:
Do your best to answer this Real Property MBE question (before even looking at the answer choices and before looking at the answer below!) Ask yourself: What is the subject? What is the legal issue? What is the rule and analysis? What is the conclusion? Try to answer these beginning questions before even reading the answer choices. Then, uncover the answer as well as read more about our Real Property MBE tip of the day.
Show the MBE Question...
Real Property MBE Question
A local bartender owns Blackacre, which is an undeveloped piece of property next to his bar. On March 1, the bartender conveyed Blackacre to an investor who paid value and wanted to build an apartment complex on the property. The investor did not immediately record his interest. On April 1, the bartender sold the still undeveloped Blackacre to his son. The son did not know about the conveyance to the investor. The son immediately recorded the deed. On May 1, the investor recorded the deed and had a construction company start digging on the site. On June 1, the son sold Blackacre to his friend. On July 1, the bartender died. His will left Blackacre to his brother, who immediately recorded the deed. On August 1, the friend recorded his deed. The jurisdiction has a race-notice recording statute.
In an action to quiet title, who will have priority rights to Blackacre?
(A) The investor.
(B) The son.
(C) The friend.
(D) The brother.
Legal Rule and Analysis:
Choose an answer choice that most closely matches your conclusion and explain why the others are incorrect:
Show the Answer to the Real Property MBE Question...
Answer to the Real Property MBE Question
Subject: Real Property
Legal Issue: The priority of ownership interests in a race-notice jurisdiction
Legal Rule and Analysis: When faced with a priority battle for ownership of land, the common law rule is “first in time, first in right.” State-enacted recording statutes have the power to change that result. A race-notice recording statute protects subsequent bona fide purchasers for value who take without notice and are the first to record. There are three types of notice: actual (the grantee has actual knowledge of a prior interest, resulting from, for example, someone telling them about it), inquiry (circumstances are such that the grantee should have investigated whether there was another interest in the land), and record (a prior interest is recorded in the chain of title). The shelter rule protects grantees that take from those protected by the recording statute, even if they themselves would not be protected.
If you get to a question with complicated facts like this, it is helpful to jot them out:
- 3/1 B –> I (BFP. No rec)
- 4/1 B –> S (BFP. Record)
- 5/1 I rec
- 6/1 S –> F (BFP. No rec)
- 7/1 B –> Brother (not BFP. Records)
In this case, the investor was the first to receive a conveyance. However, he did not record immediately. The son was next to receive the property. The son took for value, there are no indications in the facts that he had any notice of the prior conveyance, and he recorded before the investor. Therefore, the son holds priority over the investor. The son then conveyed his interest to his friend. The friend did have at least inquiry notice of the interest of the investor, as the property was undergoing construction. Although the friend had notice, he is still protected under the shelter rule, as he took from someone who was protected by the recording statute. Therefore, the friend holds priority over the investor. Note: The investor recorded outside of the chain of title so the friend would not have record notice of the investor’s deed. If you see someone’s act of recording (“rec”) out of place (e.g., it is not by the conveyance to him – it is after the B –> S transaction) then it is outside of the chain of title!
If you struggle with the shelter rule, remember the purpose of it. The purpose is not to protect the friend in this case. The purpose is to protect the son – who did everything right under the statute, so should be allowed to do whatever he wants with the land, including selling it to his friend who may have notice of the investor’s interest.
The brother was last to receive a conveyance but is not protected by the recording statute for many reasons. The brother did not pay value for the property and had notice of a prior interest. He is not protected by the recording act. Accordingly, the friend has priority over the brother.
Conclusion: The friend would win in an action to quiet title.
Look at the answer choices provided. Choose an answer choice that matches your conclusion. Review the other answer choices provided. The answer choice (C) is therefore correct. (A) is incorrect because the investor did not record before the son. The son is protected under the recording statute, and his conveyance to his friend then makes the friend protected under the shelter rule. (B) is incorrect because the son conveyed his interest away. (D) is incorrect because the brother was not a bona fide purchaser for value who took without notice and is therefore not protected under the recording statute.
MBE Tip: Pay close attention to the facts in Real Property questions! It is very helpful to write out the facts as you see them. (In fact, we highly recommend writing out recording act problems as we did above!) That way, you will not have to re-read the fact pattern several times. Instead, the facts will be clear after one reading and even a seemingly complicated fact pattern will be simplified!
Show Summary of the Two Key Takeaway Points for the Day
Key Takeaways and MBE tips from prior posts
Takeaway for the Law: To be protected as a subsequent grantee in a race-notice jurisdiction, you must be a bona fide purchaser for value that takes without notice and records first. You can also be protected under the shelter rule if you take from someone that is protected under the recording statute.
MBE Tip: Write out facts as you see them in Real Property questions!
Want to See Past MBE Tip of the Day Posts?
If you would like to see “MBE tip of the day” posts from prior days, please check out all of our past MBE tip of the day archives here! We have several of them and we list them by subject!
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