My Cousin Vinnie is Very Thankful

By Paul F. Alphen

            My Cousin Vinnie, the suburban real estate attorney, joined us for Thanksgiving on the Cape. We had Turducken (a dish consisting of a deboned chicken stuffed into a deboned duck, further stuffed into a deboned turkey) for the first time as an experiment. It was spectacular except for the subliminal memory I had of John Madden describing Turducken on Monday Night Football every Thanksgiving season, year after year. We also had a stuffed “side turkey” to make sure there was plenty of real stuffing for the gang.

Turducken

After feasting, we retired to the living room to watch football and contemplate the status of things. During half-time, perhaps under the influence of tryptophan, Vinnie got philosophical. “Paulie, I’ve got a lot to be thankful for. I’ve got relatively good health, and relatively good relatives. I’ve made a modest living doing something entertaining and working with good people. You know, I’m even thankful for professional real estate brokers, the ones that go out of their way to keep the deal moving; they meet the home inspectors at the house, help find contractors to complete the required repairs and make sure the work is done and collect the receipts. My current favorite broker is a guy named Harold out of Plymouth who helped an elderly widow sell her summer house. He was instrumental in working out the price adjustment between the parties after the home inspection, and got quotes from electricians for required repairs.”

Former REBA president Paul Alphen

I agreed with Vinnie that a good broker is worth his/her weight in gold, and added that my friend Leslie is one of those hard working brokers. Vinnie wasn’t done: “I’m also thankful for the conveyancing bar, our brothers and sisters who appreciate that real estate law is more complicated than it looks, and go out of their way to work with everyone involved to close the deal. They are the ones, who when they represent a seller, will take a look at the recent online title record when drafting the P&S and will identify issues in advance and immediately start to cure them. They are the ones who make sure the P&S identifies the correct seller and the correct property description. I’m also thankful for the lenders’ attorneys who actually read the title reports and only reach out to seller’s counsel when there are real title issues; unlike those few characters that email the first two pages of the title exam to us with a cryptic note saying that all items must be addressed.”

I concurred with Vinnie, and retold my story about the seller who was represented by her son, the in house corporate attorney, who refused to show me the deed until I handed him a certified check.

My delightful daughter in law passed around a charcuterie board loaded with tasty things, and Vinnie had to pause his monologue while enjoying his meats and cheeses. But soon he continued: “I’m also thankful for my wonderful office staff. We made them adjust to the new TRID requirements, notwithstanding that nobody knew what the requirements actually were. They cooperated with our need for background checks and credit checks, they helped us secure our files, and they learned about new procedures and disclosure statements. They continue to deal with a variety of lenders, each who appear to have different interpretations of the TRID requirements.”

Vinnie took a sip of Kentucky bourbon, paused and smacked his lips. “Wouldn’t it be ironic if the new administration did away with the CFPB?” He started laughing at his own joke and found it hard to stop. His laughter was contagious.

A former REBA president, Paul Alphen currently serves on the association’s executive committee and co-chairs the long-range planning committee. He is a partner in the Westford firm of Alphen & Santos, P.C. and concentrates in residential and commercial real estate development, land use regulation, administrative law, real estate transactional practice and title examination. As entertaining as he finds the practice of law, Paul enjoys numerous hobbies, including messing around with his power boats and fulfilling his bucket list of visiting every Major League ballpark. Paul can be contacted at palphen@alphensantos.com.

Probate Records: A Critical Element of Good Title

By Edward A. Rainen

Reviewing the records in Probate Court is an important part of every real estate title examination for either purchase or mortgage financing. The typical post-title examination probate check concerning the current owners provides necessary title information about deaths, divorces, the appointment of guardians or conservators, equity suits, name changes, and petitions for partition. This information does not need to be recorded in the Registry of Deeds in order to affect title and the probate files are the sole source of this information, without which title cannot be certified to the owner or lender.

By contrast, probates pre-dating the current owner contain critically important information for

today’s title examinations.

Certainly, the current owner in the chain of title for a piece of property must be checked in the Probate, Divorce and Equity indices in the Probate Court for the county where the property is located. It is the methodology of some examiners to check each and every owner in the chain, particularly concerning competency and divorce. There are now computer indices in virtually every Registry of Deeds so the existence of recent probate cases may be determined, but the documents are not available at the registries as described above. The title examiner’s job is to provide the closing attorney with the information that is filed in the Probate Court, and the closing attorney must interpret the information in the documents and make sure that any conveyance includes any necessary Probate Court action. The easy availability of the probate documents is vital to this process.

Ed Rainen

Transactional Lawyers are statutorily mandated to examine title back to a “good deed” at least 50 years old. Significantly, pursuant to G.L. Ch. 93, § 70, the closing Attorney must certify title to a residential buyer. Further, even commercial title transactions require proper title underwriting and all title insurance companies require a 50 year examination, as, of course, does the Land Court for its Registration case title abstracts.  Death is a fact of life and there is nothing unusual about people dying while owning their homes or commercial properties. Most title examinations cannot be performed without access to probate records, either the current transaction or 50 years or more years in the past. Accordingly, the Probate Court’s “dead case files” are the real estate conveyancer’s “living real estate records”-- - and we need access to them, desperately. Significantly we need to identify the heirs at law for intestate estates and review the will (and/or compromise) for testate estates.

As we approach the first year of full implementation of the requirements of the Consumer Finance Protection Bureau (C.F.P.B.), the time constraints on producing the documentary elements of a real estate transaction have become more and more constricted. The physical location of Probate Courts and the important probate records therein contained is an obstacle to obtaining these records timely and at a reasonable cost. Many Probate Courts are no longer immediately accessible from the Registry of Deeds in the same county. None of the probate courts have created digitized documents in .PDF format, in the same fashion accomplished by the Registries of Deeds almost 15 years ago. As the difficulty of obtaining probate records increases, the additional time and cost to obtain and review paper probate documents from a distant probate court is a genuine issue for, not only the title examiner, but the Lender’s attorney, the real estate brokers and, of course, Buyer and Seller. If residential Seller is intending to use the proceeds of the sale of his/her home to purchase a new home, and that sale is delayed two to three weeks, the delay triggers the “time is of the essence clause” of the Purchase and Sales Agreement for both the sale and acquisition and may invoke the “liquidated damages” provision as well.

Norfolk County’s probate documents were moved from the Probate Court located in the Norfolk District Registry of Deeds in Dedham to a new facility in Canton several years ago; Worcester County’s probate documents are “off site” and must be ordered 24 hours in advance before they can be examined; Middlesex North’s probate documents are in the Probate Court with the Middlesex South Registry of Deeds in Cambridge; Essex North District’s probate records are in Salem, and the Probate Court in Salem is now in a building distant from the relocated Essex South Registry of Deeds; Bristol County title examiners from the registries in New Bedford and Fall River must travel to Taunton to examine probate documents; and in Berkshire County probate records are located in Pittsfield with the Berkshire Middle Registry of Deeds. Berkshire South and North title examiners must travel to Pittsfield to retrieve probate documents. The Plymouth County Registry of Deeds is across the parking lot from the Probate Court.

The solution to the access to historic documents from closed probate cases is scanned copies available on-line. To do so offers the obvious benefits to the court of eliminating document retrieval, reducing congestion at the probate counter and lowering records storage fees. The benefit to the profession, the lending and brokerage community and the real estate buying and selling public would be significant, also.

Tenancy, Death and the Need to Probate an Estate

If an individual holds title to real property, and dies before conveying the property, the individual’s estate must be probated to convey the property.

If two or more people hold title to real property as tenants in common, and one of them dies, that person’s estate must be probated to convey his/her ½ interest in the property. If two or more people hold title to real property as joint tenants, and one of them dies, the title to the property vests in the remaining joint tenant. A proof of death for the deceased owner and, if the date of the death is within 10 years, an estate tax affidavit or estate tax release must be recorded for title to vest in the surviving joint tenant. Real Estate Bar Association (“REBA”)’s Title Standard # 71 sets forth acceptable proofs of death, one of which is a probated estate.The estate of a sole surviving joint tenant must be probated to establish ownership of the real estate in the estate.

A title examiner should check each owner in the chain of title, to establish if each owner is still alive, has filed for divorce, changed their name, has been determined to be incompetent or below the age of consent and is therefore the subject of a guardianship or a conservatorship, filed a petition to partition, or filed a suit in equity concerning the subject premises. This check is called a probate, divorce and equity check.

If the individual owner died during the period of ownership, the title examiner will abstract the “probate” file and abstract, or photocopy, the pertinent documents to include in the title

examination.

Each probate file is assigned its own distinct probate docket number. Each Probate Court keeps a docket book for all probates, and each item, i.e., petition for probate of the will, bond, inventory, license to sell, that is filed for each probate is listed in the docket book. An abstract of a recent probate may include a copy of the docket book for that specific probate, to verify that all important documents that have been filed in a probate are included in the abstract of the probate. The docket sheet allows the title examiner and the reviewing attorney to confirm that all of the documents which have been filed for a specific file are still in the probate file.

If the deceased owner died with a will, the title examination includes a completed abstract of the probate file, the allowed petition for probate of the will, a complete copy of the will and a complete copy of any license to sell. A copy of the docket sheet for the file should also be included.

If the deceased owner died without a will, the title examination includes a completed abstract of the probate file, the allowed petition for the administration of the estate and a complete copy of any license to sell. A copy of the docket sheet for the file should also be included.

The Power to Sell

For title purposes, if the will of the decedent grants the Personal Representative the power of sale, the Personal Representative may sell the property regardless of any other disposition of the property in the will. See REBA Title Standard No. 10.

If there is no power of sale in the will or if there is no will, the Personal Representative must obtain a License to Sell to sell the property. The terms of the license must be followed exactly.

The same kind of license may be granted to the Personal Representative to mortgage the property A sale by a guardian or conservator may only occur based upon a license to sell.

Conveying Property under the Massachusetts Uniform Probate Code

The adoption of the Massachusetts Uniform Probate Code (“MUPC”) on March 31, 2012 and the technical amendments that were signed into law on July 8, 2012 do not change the necessity of probating an estate to convey real estate that is held in an estate.

The importance of a title examination that includes a probate, divorce and equity check and reviewing relevant probate files in Probate Court is the same under the MUPC. The MUPC codifies the process and the procedures for probating estates, makes it clearer and simpler in many cases. Much of the law relating to conveying real estate from an estate remains the same and review of probate documents in a timely fashion is an absolute necessity. M.G.L. c. 202 is still in force and effect, so the need for a license to sell from an intestate estate, a will without the power of sale, or a conservator still exists. It is important for the real estate bar to keep the Probate Courts informed of the need for access to the actual probate files and work with the courts to find a comprehensive method of allowing the title examiner and attorney to review probate documents.

Ed Rainen has concentrates on commercial and residential real estate title and conveyancing matters. In addition to preparing title abstracts and reports on subcontract to other lawyers, in his related role as certifying counsel, Ed is also a policy-writing agent with underwriting authority for eight title insurance companies.  He frequently testifies as an expert on title matters. Ed can be contacted by email at erainen@rainenlaw.com.

NEW STATUTE REGULATING NOTARIES PUBLIC

Edward J. Smith, Esq., REBA Legislative Counsel

The Massachusetts State House

On October 6, 2016 Governor Charlie Baker signed Chapter 289 of the Acts of 2016, An Act regulating notaries public to protect consumers and the validity and effectiveness of recorded instruments. Expected to take effect in 90 days, the statute is significant for REBA members and their legal staff who are notaries.  This legislation is, in part, a codification of Executive Order No. 455 (04-04), which provided for standards of conduct for notaries (“the Executive Order”).  However, its most serious consequence for misconduct was the revocation or non-renewal of a notary’s commission.  Chapter 289 establishes penalties and rights of action. 

REBA has had a heightened interest in this subject matter on account of the organization’s leadership in opposing the practice of law in Massachusetts by non-lawyers. REBA has resisted the aggressive efforts of settlement service providers and their national trade associations, through litigation and legislation, to control all aspects of mortgage closings in the Commonwealth.  The practice of so-called “witness-only closings,” or “notary closings,” by non-lawyer notaries had spread from other states to Massachusetts.  REBA’s position has been that the home mortgage closing represents the largest financial transaction for most consumers.  Decisions made by home buyers and other mortgage borrowers are particularly susceptible of improper influence, and even predatory behavior, by individuals who are unqualified to give legal advice. 

Chapter 289 codifies the promulgation in the Executive Order, as well as the holding in REBA v. National Real Estate Information Services, 459 Mass. 512 (2011), that a non-attorney notary may notarize documents but may not conduct a real estate closing.  [M.G.L. c. 222, § 17(e)]

Chapter 289 includes most of the Executive Order’s provisions, some in a modified form.  The legislation also added other new provisions in M.G.L. cc. 183 and 222. 

Drawing from the Executive Order, the statute provides:
● Requirements for the notarial seal or stamp (expiration date affixed, exclusive property of the notary, etc.), except that a failure to comply shall not affect the validity of any instrument or the record thereof [M.G.L. c. 222, § 8, as revised]

● Qualifications for a notary; the grounds for which the Governor may decline an application for appointment or renewal of a notary commission, and the seven-year term of office, all as incorporated into the statute [M.G.L. c. 222, §§ 13, 14]

● Types of notarial acts that a notary may perform and prescribed forms for an acknowledgment, jurat, signature witnessing or copy certification [M.G.L. c. 222, § 15]

● Obligations of the notary to determine the appropriateness of the circumstances under which the notary is asked to perform a notarial act (identity and demeanor of the principal, incomplete notarial certificates, no undue influence by the notary, the notary’s relationship to the transaction or to the parties, etc.) [M.G.L. c. 222, §§ 16, 19, 20]

● Prohibition against notarizing signatures of family members shall not apply to notaries who are Massachusetts attorneys, as when the attorney takes the acknowledgement of an employee family member who witnesses a will, as provided in the Executive Order, but also if the family member employed by the attorney is the notary who takes the acknowledgement of the attorney.  [M.G.L. c. 222, § 16(a) (vii)]

● Failure of a document to contain the statutory forms shall not have any effect on the validity of the document or the recording thereof.  [M.G.L. c. 222, §§ 16, 19, 20]

● Prohibition on a non-attorney notary engaging in the practice of law includes any representation in advertising that the notary has specialized legal knowledge, with particular reference to giving advice on matters related to immigration status.  The prohibition shall not preclude a “notary who is duly qualified, trained, or experienced in a particular industry or professional field from selecting, drafting, completing, or advising on a document or certificate related to a matter within that industry or field,” nor shall it preclude a notary employed by an attorney or lender from notarizing documents in conjunction with real estate loan closings properly conducted by the employer.  [M.G.L. c. 222, §§ 16, 17, 21]

● Notaries shall maintain a chronological official journal of notarial acts, except that attorneys and their office staff shall continue to be exempt from this requirement.  [M.G.L. c. 222, §§ 12, 22, 24]

● Notary public's commission may be revoked for official misconduct, or for other good cause.  [M.G.L. c. 222, §§ 1, 26]

Chapter 289 has other provisions that did not originate with the Executive Order.  In that regard the new statute also provides:

● Authorization to the Attorney General or a District Attorney to prosecute violations of M.G.L. c. 222, punishable by a fine and/or imprisonment; and new private right of action, to include punitive damages and relief under M.G.L. c. 93A.  [M.G.L. c. 222, § 18]

● Acknowledgments shall pertain to the execution of the document, not the document itself, and can be made by an attorney or representative on behalf of a grantor [M.G.L. c. 183, § 30, as revised]

● A revision to the standard acknowledgment clause, when the document is executed by the signatory in other than an individual capacity, to assist the notary in making clear that the document is the voluntary act of the principal, not merely the signatory [M.G.L. c. 222, § 15(b)] 

● Notaries may vary from the forms set forth in the statute if they are using a form that is authorized or required by statute, regulation or executive order, including one executed in a representative capacity by one who acknowledges his voluntary act but fails to acknowledge the deed or instrument as the voluntary act of the principal or grantor [M.G.L. c. 183, § 42, as revised] [M.G.L. c. 222, §§15(h), 20]

● Failure to state that a document signed by an attorney in fact or in another representative capacity is in fact being signed as the voluntary act of the principal, not merely the signatory, shall not make the document invalid.  [M.G.L. c. 222, § 20(b)(iii)]

● A notary may use an alternative form from another state if the document is to be filed or recorded in or governed by the laws of the other state [M.G.L. c. 222, § 15(i)]

● A notary need not use the statutory form of notarial certificate if a particular printed form contains an express prohibition against altering such form.  [M.G.L. c. 222, § 16(k)]

● The Land Court may issue registration guidelines in regard to required forms [M.G.L. c. 222, §§ 15(h), 20(c)]

● Restatement of the authority of certain commissioned officers in the armed forces to take acknowledgments from persons serving in the armed forces or their dependents [M.G.L. c. 222, § 11, as revised]

Chapter 289 was a high priority for the REBA Legislation Committee, which is co-chaired by Fran Nolan and Doug Troyer.  The Committee succeeded in addressing within the legislation a number of improvident decisions of the Bankruptcy Court.

The Verdict is in: New Land Court Rule 14 Approved and in Effect

By Giles L. Krill

Last October, the Rules Committee of the Supreme Judicial Court approved “Proposed Land Court

Rule 14: Binding Summary Decision Following Bench Trial: Waiver by Parties of Special Findings of Fact and Separate Rules of Law.”  The Land Court Department of the Trial Court promulgated Rule 14 as one of multiple initiatives carried out in accordance with SJC  Chief Justice Ralph D. Gants’ request that each Trial Court Department convene a working group of judges, court staff, and attorneys to develop a “menu of options in civil cases that will ensure litigants the opportunity to have a cost-effective means to resolve their dispute in a court of law.”

Rule 14 provides litigants and their counsel with the option to proceed to a bench trial under a stipulation waiving the requirement in Mass. R. Civ. P.  52(a) that the court “shall find the facts specially and state separately its conclusions of law thereon.”  If such stipulation is approved by the trial judge, the trial decision need not include “detailed written findings of fact and rulings of law” but will instead be in a written or oral form “comparable to a jury verdict.”  Such decision must also, at a minimum, “answer special questions on the elements of each claim, at a level of detail comparable to a special jury verdict form pursuant to Mass. R. Civ. P. 49(a).”  In addition, the trial decision may include special or subsidiary findings of fact in a form “comparable to the general verdict form of a jury accompanied by answers to interrogatories in a case submitted to a jury as provided in Mass. R. Civ. P. 49(b).” 

Rule 14 is a purely elective rule that not only requires the parties to voluntarily opt in, but also requires that their attorneys put significant thought into the stipulation that they submit for court approval.  In addition to waiving Mass. R. Civ. P. 52(a) findings and rulings, the parties’ stipulation must: i) set forth the form of any questions of fact they request to have answered by the trial judge, ii) indicate whether they waive rights of appeal, iii) waive any argument, both at trial and on appeal, that depends on the existence of detailed written findings of fact, and iv) acknowledge that the appellate standard of review shall be “that which would apply to a verdict by a jury in a case tried to a jury and to the judgment entered thereon.”  In order to obtain court approval of the Rule 14 stipulation, it logically follows that the parties should agree to a substantial number of undisputed facts and frame the trial issues in a manner that is susceptible to a ruling in the nature of a jury verdict, including by proposing the form of the “special questions on the elements of each claim” that must be answered by the trial judge.  While the court retains discretion to render full Mass. R. Civ. P. 52(a) findings of fact and conclusions of law, Rule 14 specifically provides that once the court accepts the parties’ stipulation, it shall not make findings or rulings without first giving the parties a chance to object and be heard. 

Rule 14 provides Land Court litigants with a means to obtain a speedier resolution of their disputes.  Land Court cases often exact a toll on the parties regardless of outcome.  After all, the pendency of litigation can frustrate attempts to sell, mortgage, develop or otherwise make profitable use of the land subject to the litigation.  Clients feel this hardship with every passing day that they await a decision and entry of final judgment.  However, in certain cases the divisive issue can be reduced to a discrete “yes or no” question, such as: i) whether a party can carry its burden of proving title by adverse possession, ii) whether a municipal by-law applies to a certain land use activity, or iii) whether a signature on a deed was forged.  In such cases, Rule 14 presents an opportunity for parties to obtain the answer they need to move on with their lives at or near the conclusion of the trial evidence in much the same way a jury trial provides more immediate closure.  At the same time, because the Land Court has an individual calendar system, the parties receive the benefit of a particular Land Court judge serving as the trier of fact in a case the judge knows well on its unique facts, in addition to the judge’s extensive background in commonly occurring issues of law and fact that can permeate real property controversies.

The final version of Rule 14 differs from the original version submitted for public comment in March of 2016.  Among other differences, the original proposal simply required the court to “decide only the ultimate issue(s) tried”, whereas the final version requires at a minimum, that the decision “answer special questions on the elements of each claim, at a level of detail comparable to a special jury verdict form.”  This revision ensures that in cases where appellate rights are preserved, the appellate courts will have some insight into the reasoning of the Land Court judge.

Wile most parties opting for Rule 14 disposition will likely reserve rights of appeal, as a practical matter Rule 14 makes the most sense in controversies where the parties do not intend to appeal.  Appeals from civil jury verdicts are typically confined to issues such as evidentiary rulings and jury instructions, and it is harder to envision a tenable appeal on such grounds after Rule 14 forces the parties to collaborate on a thoughtful stipulation that streamlines the case into a discrete set of questions.  Furthermore, the appellate process will add to the delay that is avoided by opting for a Rule 14 trial decision, and certain categories of Land Court cases that proceed to trial are unlikely to be disturbed on appeal regardless of outcome.  For example, the appellate courts will give substantial deference to the fact-finding of the Land Court judge in assessing matters such as witness credibility or land characteristics gleaned from a “view” of the property in question.  In cases where the outcome turns on such factual assessments by the trial judge, the parties are not necessarily making a sacrifice by foregoing the broader spectrum of appellate argument that findings and rulings under Mass. R. Civ. P. 52(a) might afford.  In short, in certain classes of cases in which the law is long decided and an appellate reversal is unlikely, Rule 14 provides Land Court litigants with a viable path to quicker case closure.

A member of the Association’s litigation section, Giles Krill has over fifteen years of diverse legal experience, focusing on commercial litigation, real estate, environmental and land use law. He served as a REBA representative on the Land Court’s working group which developed Rule 14. His practice includes the representation of individuals and businesses, including developers, insurers, and lenders. Giles can be reached at giles@gottliebesq.com.