Inquiry Notice

Harper v. Paradise

•1922 - SH → M for life, remainder to M's children (DNR) (deed lost) •SH dies •1928 - SH Heirs quitclaim deed to M (replacement for SH → M deed that was lost) ("replacement" deed recorded) •1933 - M mortgages property to ET •1936 - M default/ET foreclosure (Sheriff's deed to ET)

Harper v. Paradise cont.

•1936-1955 - ET's grantees take possession - ET → P (deed recorded in 1955) •1957 - SH → M deed found/recorded •1972 - M dies • •Conflict b/w P and M's children •GA is race-notice state (BFP = subsequent, for value, without notice of earlier interest, first to record)

Inquiry Notice cont.

•A purchaser who performs the investigation that suspicious facts indicate should be performed will receive actual notice of the facts uncovered by that investigation. •Thus, inquiry notice issues usually arise when a purchaser fails to investigate suspicious circumstances. •Of course, if a prudent (reasonable) investigation would not have revealed a fact, the purchaser is not charged with notice of that fact.

Inquiry Notice

•Inquiry notice is based on the purchaser's duty to investigate suspicious circumstances. •If a person has actual notice of facts that would cause a reasonable person to inquire further, she is deemed to know the additional facts that inquiry would uncover whether she inquired or not. •That is, the person who unreasonably fails to inquire further is deemed to have imputed knowledge of facts that a reasonable inquiry would have revealed.

Types of Notice

•Three types of notice a subsequent purchaser can have with respect to an earlier interest in property: -Actual notice -Constructive/record notice -Inquiry notice