206 Conn.App. 92
Conn. App. Ct.2021Background
- March–April 2008: KDFBS, LLC purchased the condominium; deed recorded in KDFBS' name.
- June 2008: KDFBS (through its sole member Brian Scanlon) executed a $565,000 mortgage to the Davises; the grantor clause omitted Scanlon’s role as KDFBS member, so the town clerk indexed the mortgage under Scanlon’s personal name.
- October 2009: Saunders (plaintiff) made a loan secured by a mortgage recorded in KDFBS’ name after a title search that revealed no mortgage in KDFBS’ chain of title.
- December 2009: A correction report changed the Davis mortgage index from Scanlon to KDFBS, but this occurred after Saunders’ mortgage was recorded.
- Trial court: held Saunders’ mortgage had priority; the appellate court affirmed on remand, concluding Saunders had neither actual nor constructive notice because the Davis mortgage was outside KDFBS’ chain of title and the clerk had indexed correctly per the grantor clause.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the June 2008 Davis mortgage, lodged and indexed under Scanlon due to a drafting omission, gave Saunders constructive notice before Saunders recorded in Oct 2009 | No — the Davis mortgage was outside KDFBS’ chain of title and did not put Saunders on inquiry; title searcher found nothing. | Yes — the Davis mortgage was lodged with the town clerk in 2008 and its overall language put a third party on inquiry despite the grantor-clause omission. | Held for Saunders: No constructive notice; chain of title was silent and title searcher acted reasonably. |
| Whether the town clerk’s indexing (Scanlon v. KDFBS) made the mortgage discoverable despite drafting error | Clerk followed proper indexing rules; the error was in the mortgage language, not the clerk’s practice. | The lodging/recording itself should suffice to give constructive notice even if indexed by individual name. | Held for Saunders: indexing followed accepted practice; source of problem was grantor-clause error, so subsequent recorder had priority. |
Key Cases Cited
- Connecticut National Bank v. Lorenzato, 221 Conn. 77 (1992) (recordation that references omitted documentation may put a title searcher on inquiry and give constructive notice)
- Connecticut National Bank v. Esposito, 210 Conn. 221 (1989) (imperfect recordation can provide constructive notice if the recorded instrument contains sufficient information to prompt inquiry)
- Butchers' Ice & Supply Co. v. Bascom, 109 Conn. 433 (1929) (lodging certain instruments with town clerk can be constructive notice under historic practice)
- Powers v. Olson, 252 Conn. 98 (2000) (a title searcher is bound to facts appearing in the chain of title for the specific parcel)
- Ginsberg & Ginsberg, LLC v. Alexandria Estates, LLC, 136 Conn. App. 511 (2012) (explaining chain of title concept and its role in constructive notice)
- Equicredit Corp. of Conn. v. Kasper, 122 Conn. App. 94 (2010) (first-recorded mortgage generally has priority over later-recorded encumbrances)