By Zana Holley Dupee
I have been getting many questions about the Marketable Record Title Act (MRTA) and its effect on Subdivision Restrictions lately. Therefore, I decided to post a quick summary of MRTA and a recent Florida court case that addressed this issue.
The Second District Court of Appeals recently published an opinion in the case of Matissek v. Waller, which addresses the ability of MRTA to eliminate deed restrictions. Deed restrictions typically restrict the use of property. An example of this are rules that subdivisions have to ensure that the homeowners maintain their property in an attractive manner. Some restrictions may restrict what pets the owner can have, what color they can paint their house, what vehicles they can have and how they can be parked, etc. The restrictions often give the Homeowners Association powers, including the right to assess fees from the owners and the right to foreclose when those fees are unpaid.
What is MRTA? Florida's MRTA law is found in Chapter 712 of the Florida Statutes. MRTA extinguishes stale claims to property, with statutory exceptions. A title searcher need only find a root of title at least 30 years old and then search for the presence of statutory exceptions. MRTA has a very powerful effect on determining title as it eliminates the necessity to search title back for hundreds of years. Instead, MRTA only requires that an affected person need search back to the “root of title.”
Here is how MRTA works: After determining that none of the exceptions set forth in Fla. Stat. § 712.03 apply, a title examiner reviews a title record to find a “root of title.” Once the root of title is determined, all interests prior to the root of title and not subject to the exceptions of Fla. Stat. § 712.03 are extinguished by operation of law and have no further effect on the real property. The interests eliminated by MRTA include common law ways of necessity, easements not excepted by Fla. Stat. § 712.03(5), restrictions, claims of the state to non-sovereignty lands, and deed restrictions.
Exceptions to MRTA: Florida Statute § 712.03 contains a laundry list of interests not eliminated by MRTA. Of particular note is that MRTA does not apply to extinguish claims of the sovereign, either the state of Florida or the United States.
How to avoid having interests eliminated: MRTA itself contains a provision wherein interests at risk of being eliminated by operation of MRTA can be re-recorded and thus preserved for an additional period of time.
What did the Matissek case hold? In Matissek, the subdivision was platted and the restrictions were recorded in 1971. An amendment to the deed restrictions was recorded in 1978. The Matisseks traced their "root of title" back to a 1974 deed that stated it was subject to "all restrictions and easements of record." The court held that the 1971 deed restrictions were extinguished and were not properly preserved by the 1974 deed because it failed to identify the restrictions by book and page. The appellate court also held that the 1977 amendments did not survive because the amendments "do not concern a chain of title to any property" and are not muniments of title.
Implications for Subdivisions: HOAs should consult an attorney familiar with MRTA to determine how to re-record restrictions properly. HOAs may also consider adopting a rule that Owners must cite to the book and page of the restrictions on their deeds when they convey property. In addition, whether restrictions have been eliminated must be determined for each individual property in the subdivision. It is possible for MRTA to eliminate the restrictions in some chains of title but not in others.
If you have legal questions about property in the state of Florida, or if you need assistance with real estate, probate or trust litigation, you can call Zana Holley Dupee to schedule a consultation at (352) 379-5900.
Comments