Legal Description Error: Is there constructive notice?
When a recorded mortgage contains a legal description error, the error is generally cured by the inclusion of a reformation count in the foreclosure complaint. However, a valid notice issue may arise if the legal description error is not harmless and there is a subsequent purchaser for value. In Regions Bank v. Deluca, 97 So. 3d 879, 884 (Fla. 2d DCA 2012), the court recognized that there were three types of notice – actual, implied, or construction. Actual notice ‘stems from actual knowledge of the fact in question;’ implied notice ‘is the factual inference of such knowledge, [which is] inferred from the availability of a means of acquiring such knowledge when the party charged therewith had the duty of inquiry;’ constructive notice ‘is the inference of such knowledge by operation of law, as under a recording statute.’ Id. (quoting McCausland v. Davis, 204 So. 2d 334, 335–36 (Fla. 2d DCA 1967)). The recording statute referenced by the Deluca court is section 695.01 of the Florida Statutes. It states in pertinent part that no mortgage or conveyance “shall be good and effectual in law or equity against creditors or subsequent purchasers for a valuable consideration and without notice, unless the same be recorded according to law….” Fla. Stat. § 695.01 (1) (2017). The question becomes whether, under the statute, the subsequent purchaser had constructive notice of the recorded mortgage despite the legal description error.
It is well settled that a mortgage can only encumber the property described in the mortgage instrument. Accordingly, if the mortgage omits the legal description all together or contains a legal description that insufficiently identifies the property, the mortgage lien is not a valid lien against the intended property until it has been reformed. See Deluca, 97 So. 3d 879 at 884. The recording of such mortgage would not constitute constructive notice to a subsequent purchaser under the recording statute. Id.
However, if the legal description found on the mortgage sufficiently identifies the property despite its errors, then the recording of such mortgage would constitute constructive notice to a subsequent purchaser under the recording statute. See id. To determine if a legal description sufficiently identifies the property, the entire mortgage should be examined. See id. It should be noted that, upon examination of the mortgage in question, the Deluca court found that the subsequent purchaser had constructive notice of the recorded mortgage despite the subsequent purchaser’s reasonable and good faith reliance on a title search that did not disclose the existence of the recorded mortgage. See id. at 886.
In conclusion, Florida courts have consistently found that minor mistakes and irregularities in the legal description on a recorded instrument are insufficient to overcome the presumption of constructive notice that is afforded by section 695.01 of the Florida Statutes. See id. at 884-85. When the mortgage’s legal description contains minor mistakes or irregularities, a subsequent purchaser should be estopped from claiming that it did not have constructive notice of the recorded mortgage. To help to bolster the claim that the legal description only contains minor errors or irregularities, foreclosure counsel should obtain a surveyor’s affidavit attesting to the fact that the intended property is sufficiently identifiable despite the apparent minor errors or irregularities in the mortgage’s legal description.