Opinion ID: 2630648
Heading Depth: 2
Heading Rank: 2

Heading: recording and indexing

Text: ¶ 28 The warranty deed to Arnold from its predecessor in interest, Conmart, Inc., conveyed the property subject to any right-of-way now of Record. At the time Arnold filed this action, section 17-21-6 provided: Every recorder must keep: (1) An entry record, in which the recorder shall immediately upon receipt of any instrument to be recorded, enter in the order of its reception or entry, as the case may be, the names of the parties thereto, its date, the hour, the day of the month and the year of filing any such statement and a brief description of the premises, endorsing upon each instrument a number corresponding with the number of such entry. Utah Code Ann. § 17-21-6(1) (1995). [4] Arnold does not dispute that all of the relevant deeds were recorded, in terms of being entered into the record by the recorder, as described above. Therefore, there can be no claim that the January 1982 and the January 1991 deeds were not now of record. ¶ 29 Nevertheless, Arnold contends that third parties are entitled to rely upon the record title and thus it took without notice of the 1991 corrective warranty deed. This argument actually centers around the indexing rather than the recording of the deeds, taking us to the issue of notice. The Recorder Act also required the recorder to keep, inter alia, a grantors' index, a grantees' index, and an abstract record . . . by tract. [5] Utah Code Ann. § 17-21-6(2), (3), (6) (1995). ¶ 30 Arnold asserts that the 1991 corrective warranty deed was not properly abstracted to the Arnold Property in the recorder's tract index. Furthermore, he complains that the deed is indexed to Lowenberg in the grantor and grantee indexes although Lowenberg was the previous owner of the Love Property and never owned an interest in the Arnold Property. Therefore, Arnold avers that it had no notice of the 1991 deed and attempts to leap from that premise to the conclusion that it took the property as a bona fide purchaser for value without notice of the easement. We disagree. When Arnold took title in 1993, the disputed right-of-way was in open and obvious use by Lowenberg, Love's predecessor in interest. Arnold's warranty deed informed it that its property was subject to easements of record, and visual observation confirmed that an apparent right-of-way was indeed in use. This use continued, ostensibly without objection by Arnold, until after Lowenberg conveyed his interest to Love in 1995, at which time Love commenced use of the right-of-way. Furthermore, Arnold does not dispute that the 1982 warranty deed, expressing at least the intention to create an easement for the benefit of the adjoining Love Property, appeared in Arnold's chain of title. In such circumstances, Arnold was not a bona fide purchaser for value without notice. [6] ¶ 31 Arnold relies on County Board of Equalization v. State Tax Commission, 789 P.2d 291, 296 (Utah 1990) (Howe, J., dissenting), for the proposition that [t]here is not `constructive notice' when inquiry extrinsic to the public record is necessary. In that case, however, there was nothing on the tax rolls to show that any building was on the land on January 1, 1984. Only an inquiry extrinsic to the tax rolls would have revealed that. Id. In the instant case, contrastingly, all of the relevant deeds describing the easement were part of the public record when Arnold purchased the property. In First American Title Insurance v. J.B. Ranch, 966 P.2d 834, 837 (Utah 1998), we recognized that in addition to constructive notice resulting from a record or imputed from the recording statutes, a second type of constructive notice is presumed because of the fact that a person has knowledge of certain facts which should impart to him, or lead him to, knowledge of the ultimate fact. Thus, observation of use gave Arnold constructive notice of a right-of-way across his property for the benefit of the adjacent Love Property. Arnold was therefore on notice to inquire within the public record. ¶ 32 The logical first records to be searched in an investigation of reasonable diligence would be the grantor/grantee indexes and the tract index. Western Management appears as grantor on the 1982 warranty deed. Therefore, Western Management would be an obvious grantor to search. The 1991 corrective warranty deed is indexed to the name of Western Management, Ptr., in addition to William J. Lowenberg, in the grantors and grantees indexes. Thus, a search of documents indexed to Western Management would disclose the 1991 corrective warranty deed. ¶ 33 Turning to the tract index for the northeast quarter of Section 21, Township 1 South, Range 1 West, Salt Lake County, in which the Arnold Property is located, Arnold would also encounter the abstract of the 1991 corrective warranty deed in connection with a portion of the adjacent Love Property, which Arnold knew was the beneficiary of the easement. In addition to the 1991 deed's metes and bounds description of the Love Property, the abstract contains the instruction SEE DOCUMENT FOR ADDITIONAL DESCRIPTION. Therefore, with little or no effort other than searching the title of his own property, and the very part of the tract index where abstracts relating to his own property were located, Arnold would be directed to the 1991 corrective deed. ¶ 34 Furthermore, the quiet title decree contained the same description of the easement found in the 1991 deed. Arnold contends that the description of the easement in exhibit A of the decree is not part of the operative language of the decree, and does not adjudicate the right-of-way. This is true, but it is beside the point. Regardless of its role in establishing the easement, the decree is important as evidence of the right-of-way. The quiet title decree is also correctly indexed to the east half of the northeast quarter of Section 21. After identifying the Love Property, the abstract of the decree states (R/W EASE RUNS ACROSS PARCEL NO. SEE DOC). Furthermore, the tax identification number for the Arnold Property appears immediately to the left of that portion of the abstract. ¶ 35 Therefore, we hold that Arnold had constructive notice of an easement and that an investigation of reasonable diligence within the public record would have given him actual notice of an easement. The County Recorder's failure to abstract the 1991 corrective warranty deed to Arnold's property in the tract index did not deprive Arnold of notice of the easement, nor put discovery of the easement outside the range of reasonable diligence. Because Arnold consequently has no cause of action against Salt Lake County or the County Recorder, we do not reach the issue of the timeliness of the action against those parties. ¶ 36 We affirm the trial court's grant of summary judgment to Love, and the denial of summary judgment to Arnold. We further affirm dismissal of the amended complaint against Salt Lake County and its Recorder. ¶ 37 Justice Russon, Justice Wilkins, and Judge McIff concur in Justice Howe's opinion. ¶ 38 Having disqualified themselves, Chief Justice DURHAM and Associate Chief Justice DURRANT do not participate herein; District Judge K.L. McIFF sat.