Category: Quiet Title Actions

QUIET TITLE: A CAUSE OF ACTION WITH STRICT REQUIREMENTS

QUIET TITLE: A CAUSE OF ACTION WITH STRICT REQUIREMENTS

An action to Quiet Title is a useful tool to yield clear and marketable title.  But it is more than an action for a Declaratory Judgment that asks the court to remove a cloud on title.  A Quiet Title count has strict pleading requirements.

The elements of a claim to Quiet Title are that 1) the party bringing the action possesses true title to the property, and 2) the title must be superior to other claimants.  Dudley v. Neteler, 392 Ill.App.3d 140, 143 (4th Dist. 2009).  In other words, a Quiet Title action may be maintained only when one holds a legal or equitable interest in property that is superior to the alleged title defect.  Antoniou v. Heartland Bank and Trust Co., 2015 IL App (1st) 150015-U at ⁋ 18.  One reprieve is that a party need not establish a perfect title to prevail.  Id.

There is a final, sometimes overlooked, element for a claim to Quiet Title.  The party must plead, and ultimately prove in order to prevail, that it is in possession of the subject property.  Dodge v. Nieman, 150 Ill.App.3d 857, 860 (1st Dist. 1986).  While possession by an agent or tenant of the party is sufficient, failure to plead actual possession leaves a Quiet Title complaint subject to dismissal.  Id. at 860-63.

A Quiet Title claim can similarly fail at the summary judgment stage.  See Floyd v. Hill Funding, LLC, 2020 IL App (1st) 192353-U.  In Floyd, plaintiff entered into an installment contract to purchase certain property in Chicago, Illinois.  Id. at ⁋ 3.  Upon payment of all installments, plaintiff would be entitled to conveyance of the property.  Id.

Plaintiff failed to make all payments under the installment contract.  Id. at ⁋ 5.  Plaintiff’s claim to quiet title against the property’s owner ultimately failed and defendant was awarded summary judgment.  Id.  The court ruled that plaintiff’s interest in the property via the installment contract, was not superior to that of the property’s owner of record.  Id.

On the other hand, a property pled Quiet Title claim can result in clear and marketable title.  See North Community Bank v. Aetna Bank, 200 Ill.App.3d 350 (1st Dist. 1990).  In North Community Bank, defendant was given a mortgage by the successful bidder at a foreclosure sale.  Id. at 351.  However, the deed to the successfully bidder contained significant defects in the property’s legal description.  Id.

Defendant then gave a mortgage to plaintiff.  Id. at 352.  When defendant defaulted under the terms of that mortgage, plaintiff filed an action to foreclose its mortgage and quiet title as to any interest of the successful bidder at the foreclosure sale.  Id.  The court ruled that the successful bidder’s claim to the property was not superior to plaintiff’s claim.  Id. at 353-54.  As a result, plaintiff was granted summary judgment.  Id.

Case law indicates that Illinois courts are strict when it comes to pleading a cause of action to Quiet Title.  However, if a party pleads the necessary elements, and has a claim to the property that is superior to others, that party can successfully clear a property’s title.

For additional reading on Quieting Title see:

 

Jody D. v. Bank of America, N.A., 2018 IL App (3d) 170558-U;

Chicago Title Land Trust Co. v. Iverson, 2016 IL App (1st) 150986-U;

McElmeel v. Shedelbower, 2013 IL App (5th) 130042-U.

QUIET TITLE: A USEFUL TOOL IN RESOLVING PROPERTY TITLE ISSUES

QUIET TITLE: A USEFUL TOOL IN RESOLVING PROPERTY TITLE ISSUES

The act of Quieting Title on property is intended to produce clear and marketable title.  If a property’s title is not clear and marketable it likely has a title defect, also known as a “cloud.”  Title defects are called clouds because the defect may obscure the property’s true owner or reflect that a party has an interest in property when it actually does not.

Clouds on title include deeds that break an otherwise clear chain of conveyances or an unreleased mortgage that secures a loan that was actually paid off.

Clouds on title are often discovered when property is being sold.  Sellers almost always have a contractual obligation to transfer clear title to the buyer.  As a result, the seller obtains a title insurance company to search the property’s title history.  If a cloud on title appears, it may need to be resolved with an action to Quiet Title.

The seller, often through an attorney, files a Complaint to Quiet Title in the Illinois Judicial Circuit where the property is located.  The Complaint explains the cloud on title and why it should be removed.  The court then determines whether or not the cloud is a legitimate claim on the property.  If the cloud is not legitimate, the court issues an order removing the cloud from the property’s title history.

For example, you attempt to refinance the current loan that you used to buy your property.  The new loan will be secured by a new mortgage.  But before your lender provides the new loan, it uses a title insurance company to check your property’s title.  Although unlikely, it is possible that the lender’s title insurance company finds an old mortgage recorded against your property that was given by a previous owner.

A Complaint to Quiet Title would allege that the loan secured by the old mortgage was actually paid off.  As a result, the holder of the old mortgage should have released it from your property’s record.  The old mortgage is still of record by mistake.

In this case, the court hearing your Quiet Title action is highly likely to order the old mortgage released from your property’s title history.

Having a good attorney can help further understand how to Quiet Title and whether it is necessary to resolve any clouds on your property’s title.