OPINION
South Sanpitch Company appeals from the trial court’s judgment insofar as it awarded no damages to South Sanpitch for the negligence of D Land Title Company. The trial court found D Land Title negligent, but ruled that no harm had resulted from D Land Title’s delay in recording a partial reconveyance of rеal estate. South Sanpitch claims the trial court erred first, by finding that D Land Title’s negligence did not cause South Sanpitch’s title to be encumbered and, second, by failing to
FACTS
For purposes of this appeal, discussion of various transactions among the defendants can be omitted and the facts otherwise simplified.
Margaret Gunterman was the beneficiary under a trust deed encumbering a large tract of unimproved real estate located in Sanpete County. D Land Title was named as trustee of the trust deed. South Sanpitch completed its performance under a uniform real estate contract and became entitled to ownership of a ten-acre parcel which was part of the larger tract. Accordingly, on December 6, 1983, Gunter-man requested D Land Title to exeсute a deed of partial reconveyance for the benefit of South Sanpitch. Within a few days, D Land Title executed the partial reconveyance and the parties do not dispute that D Land Title should have recorded the document promptly. Instead, an employee of D Land Titlе placed the deed on top of an office refrigerator and it was not discovered and recorded until May 29,1984. Meanwhile, on April 9, Gunterman assigned to Daniel Pack her interest as beneficiary under the trust deed. The assignment document did not exclude from its scope the ten-acre parcel already reconveyed to South Sanpitch. Pack recorded his assignment on May 1, 1984.
In June, Action Title Company was substituted as trustee under the trust deed and Pack instituted nonjudicial foreclosure of the trust property, including the parcel purchased by South Sanpitch. South Sanpitch filed this action tо quiet title in, and prevent Pack from foreclosing on, its parcel. South Sanpitch and Pack reached a stipulation quieting title to the parcel in South Sanpitch, and claims against the other defendants were resolved without trial as well.
A trial was held to determine the remaining issues, namely, whether South Sanpitch was injured by D Land Title’s failure to promptly record the deed of partial recon-veyance and whether attorney fees incurred by South Sanpitch to quiet its title were recoverable as an element of damages. At trial, South Sanpitch claimed that D Land Title’s negligence in not rеcording the deed within a reasonable time permitted a cloud to be created on South San-pitch’s title. According to South Sanpitch, a cloud arose when Pack recorded his assignment of Gunterman’s interest at a time when reconveyance of the South Sanpitch parcel did not аppear of record. Thus, South Sanpitch argued that D Land Title should be held liable for the expenses incurred by South Sanpitch as a result of having to vindicate its title. The trial court rejected this argument and held that while D Land Title was negligent in not promptly recording the deed of reconveyance, South Sanpitch was not injured because any cloud on its title was cured by the belated rec-ordation of the deed on May 29, 1984. Accordingly, the trial court denied South San-pitch’s claim for damages.
South Sanpitch’s appeal places in issue two aspects of the trial court’s decision: First, whether D Land Title’s negligence caused actual harm to South Sanpitch, an issue which primarily turns on whether the partial reconveyance and the assignment are “conveyances” under the previous version of the Utah recording statute and, second, if South Sanpitch was harmed, whether it can rеcover attorney fees as damages.
RECORDING AND CONVEYANCES
The trial court concluded that since the deed of partial reconveyance for South San-pitch’s benefit was executed and delivered first, the assignment was a nullity insofar as it purported to transfer a security interest in property already released from the encumbrance created by the trust deed. While at first glance this seems abundantly reasonable, the “race-notice” provisions of Utah’s recording statute compel the opposite conclusion.
Every conveyance of real estate hereafter made, which shall not be recorded as provided in this title, shall be void as against any subsequent purchaser in good faith and for a valuable consideration of the same real estate, or any portion thereof, where his own conveyance shall be first duly recorded.
Under this provision, the partial recon-veyance to South Sanpitch is void as to Pack, i.e., he retains an enforceable security interest in South Sanpitch’s property, if each of these criteria is met: (1) the assignment to Pack is properly characterized a “conveyance”; (2) the partial reconveyance is properly characterized a “conveyance”; (3) Pack is deemed a “subsequent purchaser ... of the same real estate, or any portion thereof”; and (4) Pack is a good-faith purchaser for value.
Although “[a]t common law the term ‘conveyance’ meant a transfer of title or of an estate in land,”
Bybee v. Stuart,
The term “conveyance” as used in this title shall be construed to embrace every instrument in writing by which any real estate, or interest in real estate, is created, aliened, mortgaged, encumbered or assigned, except wills, and leases for a term not exceeding one year.
Under this provision, the assignment to Pack is clеarly a “conveyance.”
While a trustee’s reconveyance is not referred to explicitly in § 57-1-1, a reconveyance serves to release a security interest in property and therefore to “alien,” i.e., alienate, that interest. See Webster’s Third New International Dictionary 53 (1986). Thus, the partiаl reconveyance is likewise a “conveyance” under the statute.
Construing the term “conveyance” as used in § 57-3-3 to include both assignments of the beneficial interest under a trust deed and trust deed reconveyances is fully consonant with a key provision of the trust deed statute, which provided in pertinеnt part as follows:
Any trust deed, substitution of trustee, assignment of a beneficial interest under a trust deed, notice of default, trustee’s deed, reconveyance of the trust property and any instrument by which any trust deed is subordinated or waived as to priority, when acknowledged as provided by law, shall be entitled to be recorded, and shall, from the time of filing ... impart notice of the contents thereof to all persons....
Utah Code Ann. § 57-1-36 (1986) (emphasis added). 3
Turning to the other pivotal terms in § 57-3-3, “subsequent purchasеr ... of the same real estate” is not limited to purchasers of fee title, but is expansive enough to include an assignee, for value, of a mortgage or other lien in real estate.
Cf. Federal Land Bank v. Pace,
This brings us to the final issue posed by § 57-3-3, namely whether Pack was a purchaser, for value, without notice of the unrecorded deed of reconveyance to South Sanpitch. If he was, South San-pitch’s deed is void as to Pack, even after it is recorded, since Pack’s interest was recorded first.
E.g., Kemp v. Zions First National Bank,
As a result of D Land Title’s negligence, South Sanpitch’s title to the ten-acre parcel was clouded and South Sanpitch reasonably commenced this action to clear its title, i.e., to undo the damage D Land Title’s negligence had caused it. Had the deed of reconvеyance been promptly recorded by D Land Title, South Sanpitch’s title to the parcel would have appeared of record at the time of Gunterman’s assignment to Pack. Accordingly, South Sanpitch’s title would not have been clouded by the assignment and such legal action would not have been necessary.
ATTORNEY FEES AS DAMAGES
South Sanpitch claims that a proper element of the damage it suffered as a result of D Land Title’s negligence is the attorney fees it incurred in quieting title to its parcel.
5
In response, D Land Title offers up the doctrine that an award of attorney fees is not appropriate unless provided for by statute or contract.
See, e.g., B & R Supply Co. v. Bringhurst,
This exception to the general rule is commonly referred to as the “third-party tort rule.”
See, e.g., Gray,
Although South Sanpitch joined D Land Title and the so-called third parties in a single action, it secured relief against the other parties and" cleared its title before pursuing its clаim for fees against D Land Title. More importantly, South Sanpitch does not seek to recover attorney fees incurred in litigating against D Land Title, which would be recoverable, if at all, only under the general rule; South Sanpitch seeks only those fees incurred in litigation against others to undo the problеm D Land Title negligently caused. Consequently, we hold that the third-party tort rule is applicable to this case and South Sanpitch is entitled to recover appropriate attorney fees from D Land Title.
Of course, care must be taken in cases like this to ensure not only that the attorney fees аre otherwise properly calculated,
see, e.g., Dixie State Bank v. Bracken,
In this case, D Land Title focused its resistance on avoiding the imposition of any liability for attorney fees and did not much concern itself with the separate question of the amount of recovery, assuming some recovery was in order. Thus, the attorney for South Sanpitch testified that $2300 was an appropriate, reasonable fee to be assessed against D Land Title. D Land Title did not object to this testimony, demand greater specificity, cross-examine to determine how the fee was arrived at, nor offer controverting testimony. From all that appears, $2300 was reasonably incurred by South Sanpitch as attorney fees properly allocated to resolving the quiet title action and therefore properly imposed on D Land Title.
Accordingly, we reverse the trial court’s judgment as it concerns D Land Title and remand with instructions to enter judgment in the amоunt of $2300 against D Land Title and in favor of South Sanpitch.
BENCH and DAVIDSON, JJ., concur.
Notes
. Effective July 1, 1988, the Legislature amended the section, apparently to avoid use of the misleading term "conveyance." See 1988 Utah Laws ch. 155, § 15 (codified in Utah Code Ann. § 57-3-3 (1988)). The rewritten section now refers to "[ejach document" instead of "[e]very conveyance.”
. The 1988 amendment, see Note 1, supra, deleted the definition for "conveyance” and substituted a definition for "document.” 1988 Utah Laws ch. 155, § 1 (codified in Utah Code Ann. § 57-1-1(2) (1988)) ("‘Document’ means every instrument in writing, including every conveyance, affecting, purporting to affect, describing, or otherwise concerning any right, title, or interest in real property, except wills and leases for a term not exceeding one year.”).
.The legislation amending the recording statute, see Notes 1 & 2, supra, also revised § 57-1-36. See 1988 Utah Laws ch. 155, § 5.
. From all that appears, Pack paid value for the assignment and had no notice of the partial reconveyance. South Sanpitch managed to clear its title through settlement, rather than because it was аble to show Pack was not entitled to the protections of the recording statute.
. Nothing in this opinion should be taken to mean that damages in cases like these are limited to attorney fees. For whatever reason, all South Sanpitch seeks to recover from D Land Title is attorney fees inсurred in its quiet title action against Pack.
. In the
Pacific Coast
case, defendant had issued a bond indemnifying plaintiff title company from any loss resulting from defaults by a builder, one of whose duties was to keep the property free of liens.
[I]t could reasonably be foreseen that the natural and usual cоnsequence of Cassady’s failure to pay the laborers and materialmen would bring about the series of events which occurred: that liens would be filed and legal proceedings instituted to enforce them; that plaintiff Title Company, having the duty to keep the titles clear, would interpose defenses and attend to some disposition of the claims, which would require the services of attorneys. ...
. Dobbs discusses the rule under the heading “Fees incurred in prior litigation as a result of tort or breach of contract." D. Dobbs, Remedies § 3.8 at 195 (1973).