Va. Cir.: Easement enforceable despite chain-of-title confusion

Even though the owner of a servient estate had granted it to himself as trustee of a living trust, his subsequent easement – granted and recorded in his individual capacity – operated as a partial revocation of the prior transfer to the trust and satisfied the written notice requirement to subsequent purchasers.

Background

In 1974, Austin Foster granted an easement to his sister, Plaintiff Janet Kruck, for a septic field on his servient parcel of land.

In April 2006, Foster conveyed a servient parcel to himself as Trustee of the Austin Foster Revocable Living Trust.

On June 9, 2006, Foster in his individual capacity executed an amended deed of easement for (1) joining the Defendants’ driveway for egress and ingress and
(2) allowing Kruck’s unfettered use of the land provided in the 1974 easement for the septic drain field.

On June 13, 2006, both the 1974 easement and the amended deed of easement were recorded. The conveyance was recorded on June 21, 2006.

In January 2008, Foster as Trustee conveyed his servient parcel to Edward and LeeAnn Foster, recorded the next month.

Following a foreclosure in November 2012, the Department of Housing and Urban Development conveyed title of the parcel to the Defendants, recorded the next month.

In this suit to enforce Kruck’s easement rights, the Defendants maintain that it was an invalid grant outside the chain of title. They contend that Foster no longer held title when he purported to grant the amended easement because he conveyed the property to himself as trustee, effective upon delivery, after which he no longer had title in his individual capacity. Therefore, Defendants argue, he lacked power to encumber the parcel with the second easement.

Bona fide purchaser

The recording statute does not protect Kruck from challenge to her interest because the encumbrance is not a transfer of an estate that is encompassed by the statute.

Code § 55-96(A)(1) uses the phrase “conveying real estate” rather than “conveying an interest in real estate,” which makes a drastic difference in its application. In Code §64.1-01, a “bona fide purchaser” is defined as “a purchaser of property for value who has acted in the transaction in good faith.” This definition, though elsewhere in the Code, provides insight as to how the phrase is most likely intended by the legislature in the Code as a whole, especially when the Code provides no other conflicting definition.

Here, the conveyance of the parcel to the Trust in April 2006 was valid as of that point in time. Due to the fact that Kruck was not a bona fide purchaser, the recording of the second easement prior to the recording of the conveyance to the Trust makes no difference as to her status. The easement in her favor is therefore not protected from challenge by the statutory recording scheme.

Revocation

The grantor’s deed of easement operated as a partial revocation of the transfer of the estate into the Trust, making the easement valid and binding on successors in interest to that tract of land.

Unlike in Austin v. City of Alexandria, 265 Va. 89 (2003), the deed of gift in this case makes no mention of any steps that must be taken in order to revoke title. The Trust agreement also doesn’t specifically call for the settlor to execute a deed to revoke title to the property, in whole or in part, in order to then encumber the property as an individual. As such, the execution of the second easement satisfies the written notice requirement, and that action not only revokes the consequent interest in the property previously conveyed to the Trust, it also revokes title at least in part, thereby allowing Foster to validly grant the second easement in his individual capacity.

Defendants’ plea in bar denied.

Kruck v. Krisak, Case No. CL18-1673, May 23, 2018. Fairfax Cir. Ct. (Bernhard). VLW No. 018-8-047, 16 pp.