Quieting Title to Real Property
Often with California real estate people find themselves in situations where someone else may be alleging a claim against their real property. The cause of the problem can be for a variety of reasons, such as mistake, inadvertence or even fraud. For example, there are instances where two people adverse to one another both claim they are the rightful owner of a piece of property and that the other has no right, title or interest in the property. They may even both have recorded deeds against the property supporting their claims. What can the parties do to bring to put this dispute to bed? Who gets to decide who is right and who is wrong? Fortunately, for the parties there is a legal process through the court system set up to resolve these types of disputes which is referred to as an action to quiet title.
An action to “quiet title” refers to a legal proceeding in court wherein parties can provide evidence as to the facts supporting their claim to title against any adverse claims and the court will make a determination as to which of the parties competing claims to title prevails. The prevailing party will be entitled to a quiet title judgment that can be recorded in the County records establishing their superior claim to title and in effect clearing any clouds on title. Quiet title judgments may be needed when property owners are trying to sell a property since a buyer may not be able to get title insurance if there are known competing claims against a property. Also, if a property owner is trying to obtain financing secured by the real property a lender may want adverse claims cleared from title prior to closing out the loan.
A quiet title action can be filed by anyone who claims an interest in real property no matter what that interest may be. The claim can be about fee ownership to the land, as stated in the example above, but it could also be used to establish rights to an easement, license, lease or other interest in real property. Under the statute a “claim” is defined as “a legal or equitable right, title, estate, lien, or interest in property or cloud upon title.” (Cal. Code of Civ. Proc. §760.010)
To initiate a quiet title action a party needs to file their lawsuit in a court in the county where the real property is located. (Cal. Code of Civ. Proc. §760.050) At the same time that the party files the lawsuit, or shortly thereafter, they are required to record a notice of pendency of the lawsuit in the county records (a/k/a lis pendens), which in effect gives notice to the world that there is a pending dispute involving title to the real property. (Cal. Code of Civ. Proc. §761.010) A complaint to quiet title must be signed under penalty of perjury by the party filing the complaint and must include, at a minimum:
1. A description of the property that is the subject of the action;
2. The title of the plaintiff as to which a determination under this chapter is sought and the basis of the title;
3. The adverse claims to the title of the plaintiff against which a determination is sought;
4. The date as of which the determination is sought; and
5. A prayer for the determination of the title of the plaintiff against the adverse claims. (Cal. Code of Civ. Proc. §761.020)
The plaintiff in a quiet title action shall name as defendants any person(s) having adverse claims to the title of the plaintiff against which a determination is sought. (Cal. Code of Civ. Proc. §762.010) This is an important step in the quiet title process because if you fail to include someone in your quiet title lawsuit that you know has a claim against title then ultimately your quiet title judgment may not be enforceable against that person and you would have to start all over again in court with a new quiet title action against that person. Typically, a quiet title litigant will also name as a defendant all persons not known to the plaintiff that may have an adverse claim against title.
Once all the necessary parties are before the court, “the court shall examine into and determine the plaintiff's title against the claims of all the defendants. The court shall not enter judgment by default but shall in all cases require evidence of plaintiff's title and hear such evidence as may be offered respecting the claims of any of the defendants, other than claims the validity of which is admitted by the plaintiff in the complaint. The court shall render judgment in accordance with the evidence and the law.” (Cal. Code of Civ. Proc. §764.010)
Generally, in a quiet title action the parties will want to show any and all documentary and other evidence supporting their claim to title to the court and be prepared to talk about the circumstances and events regarding each document or other evidence. For example, if a litigant is claiming that they are the owner of the property, they should be prepared to provide evidence establishing their purchase of the property, e.g. sales documents, grant deed, title insurance, payment receipts, use of the property, etc. and discuss who they transacted with, where, when and under what circumstances. The litigant should call as witnesses at trial any person having information about their purchase of the property to corroborate their story.
Once the court has heard all of the evidence from all parties it will render a judgment in favor of one of the parties. The judgment in the action is binding and conclusive on all persons known and unknown who were parties to the action and who have any claim to the property, whether present or future, vested or contingent, legal or equitable, several or undivided and all persons who were not parties to the action and who have any claim to the property which was not of record at the time the lis pendens was filed or, if none was filed, at the time the judgment was recorded. (Cal. Code of Civ. Proc. §764.030)
Quiet title actions are very technical and require the litigant to follow the statutory procedures in order to end up with a final and conclusive judgment as to the title issue being litigated. Therefore, it is important to contact an attorney experienced with litigating quiet title disputes to ensure your legal matter is handled properly.
This update is provided to our clients, business associates and friends for informational purposes only. Legal advice should be based on your specific situation and provided by a qualified attorney.