Quiet title action; Applicability of the race-notice statute; MCL 565.29; Penrose v McCullough; Whether a purchase agreement constituted a “conveyance”; MCL 565.35; Whether plaintiff was a bona fide purchaser; The after-acquired-title doctrine; Richards v Tibaldi

The court held that the race-notice statute was not implicated “because plaintiff’s purchase agreement did not constitute a ‘conveyance,’ and even if the race-notice statute was implicated, plaintiff was not a bona fide purchaser.” Further, it agreed with defendant-42 Fullerton “that the after-acquired-title doctrine cured the fraudulent chain of title” and as a result, the trial court did not err in ordering that it “held full legal and equitable title to the property.” Plaintiff’s claims against defendants-appellees in this quiet title action were dismissed after the trial court granted defendants’ motions for reconsideration and summary disposition. Plaintiff argued that it erred “because plaintiff’s claim of interest in the disputed property was the first recorded.” The court disagreed, noting that “plaintiff never had a deed to the property; it simply had a purchase agreement. Moreover, [its] purchase agreement was never fully executed—plaintiff did not pay the full purchase price, and [defendant-]Bohadana never conveyed the deed.” Thus, the agreement was “an executory contract, not a ‘conveyance’ of property.” Further, the trial court correctly determined “that plaintiff was not a bona fide purchaser because plaintiff knew of [defendant-]Estell Manor’s interest in the property. Plaintiff’s knowledge is indisputable considering the fact that there was a contingency statement regarding Estell Manor within plaintiff’s purchase agreement with Bohadana.” As to the grant of title to 42 Fullerton, that party acknowledged that the 2017 quitclaim deed from nonparty-Global-Michigan to defendant-Anderson “constituted a fraudulent conveyance.” It argued this “issue was rectified by the 2021 warranty deed from Bohadana to” defendant-Precipice, and the court agreed. “Bohadana—who was in the nonfraudulent chain of title—attempted to sell the property three times: (1) first, to Anderson; (2) second, to plaintiff; and (3) third, to Precipice. But” the first two sales “were never completed—the sale to Anderson was never recorded, and plaintiff never paid the full purchase price or received the deed. Conversely, [the] conveyance to Precipice was completed and recorded. Because Precipice ultimately received a valid warranty deed from Bohadana, who was within the proper chain of title, the after-acquired-title doctrine holds that Precipice’s earlier warranty deed with [defendant-]Legacy One, and Legacy One’s subsequent warranty deed with 42 Fullerton, be enforceable.” Affirmed.