The reinstatement of covenants, conditions, and restrictions extinguished by The Marketable Record Title Act.

• Author: Poliakoff, Gary A.
• Position: Florida

The Marketable Record Title Act (MRTA) seemed like a good idea when it was enacted by the Florida Legislature in 1963. (1) The intent was to simplify title searches to stabilize property law, by clearing old defects from land titles, limiting the period of record searches, and clearly defining marketability by extinguishing old interests of record not specifically claimed or reserved.

No longer would a title examination have to search title back to the Spanish land grants. Any person having legal capacity (2) to own land in the state, who, alone or together with the predecessor in title, was vested with any estate in land of record for 30 years or more, is deemed to have a record title to such estate and land, which shall be free and clear of all claims except the matters set forth in F.S. [section] 712.03. An unanticipated consequence of MRTA, which apparently was not recognized by its drafters, was its impact on the covenants, conditions, and restrictions of planned developments.

MRTA's Impact on Covenants, Conditions, and Restrictions

The intent of covenants, conditions, and restrictions (CC&Rs) is to promote and preserve the symmetry, beauty, and general good of all interested in the scheme of planned developments. (3) Regrettably, as a consequence of MRTA, some large planned communities found themselves without the legal authority to enforce their covenants, hire managers, provide lawn maintenance and security, and/or levy assessments to maintain and operate the common areas. Communities were in shambles due to their complete inability to function. This was caused in part by the legislature's use of broad language that extinguishes "all claims" that are at least 30 years old and that predate the root of title of the property in question. (4) Fortunately, the legislature recognized and thankfully corrected part of the problem by providing a device to those property owners who sought to preserve their CC&Rs that were set to expire. As such, "the Marketable Record Title Act was also designed to be a recording act in that it provides for a simple and easy method by which the owner of an existing older interest may preserve it." (5) As Florida's Supreme Court noted, "the legislature did not intend to arbitrarily wipe out old claims and interests without affording a means of preserving them and giving a reasonable period of time within which to take the necessary steps to accomplish that purpose." (6) This preservation mechanism can be found in F.S. [section] 712.05 (1991), which allowed any person claiming an interest in land to protect the interest from the operation of MRTA by filing a written notice.

HOAs and Their Inability to Preserve Covenants Yet to Expire

Despite the proffered remedy of allowing property owners to renew their CC&Rs through proper notice, MRTA resulted in certain other problems that the original version of [section] 712.05 could not cure. Although [section] 712.05 allowed individuals to renew their CC&Rs through written notice, the law failed to permit homeowners' associations (HOAs) to act on behalf of their constituents to preserve the original CC&Rs of that particular community. In addition, the common procedure for how planned communities are deeded and recorded provided a major hurdle for renewing CC&Rs for these neighborhoods. For planned communities, a developer typically files a plat and then the developer records covenants and restrictions that govern the property within the platted area. When the developer deeds the property to an initial purchaser, the legal description usually used in the deed only references the plat, and not the recorded covenants and restrictions. Customarily, when the initial purchaser reconveys title to someone else, the same legal description originally used by the developer is what is used in the subsequent deeds. Thus, the covenants and restrictions are not found in the chain of title for the particular lot. (7) Consequently, if a development is more than 30 years old, then the subdivision...