By: Douglas G. Christy, Esq.

In residential communities (and many recently developed commercial subdivisions), the initial developer of the community or subdivision either chooses to, or is required to, create and record in the public records a set of covenants, conditions and restrictions (“CC&Rs”) to promote and preserve the design scheme, ensure the ability to fund and operate the community or subdivision, and to general enhance the property values and general welfare.  However, CC&Rs that are of record for at least 30 years old and which predate the “root of title” to any property may be extinguished if action is not taken to preserve them.  The extinguishment of the CC&Rs can take place automatically by operation of a frequently overlooked law, known as the Florida Marketable Record Title Act (“MRTA”), and regardless of the independent term of the CC&Rs.  That is, as a consequence of MRTA, a planned community or subdivision may find itself without the legal authority to enforce its covenants, provide services or restrict the use of property, and/or levy assessments to maintain and operate the common areas.

What is MRTA?  Why was it created?

Before MRTA, title on property in Florida was traced back to the Spanish Land Grants.  Title Companies maintained huge warehouses contained mountains of paper related to the property in their areas; and title searches took weeks.  The purposes of MRTA, founds at Chapter 712, Florida Statutes, are 1) to limit title searches to recently recorded instruments only; 2) to clear old defects of record; 3) to establish parameters within which marketability can be determined; 4) to reduce the number of quiet title actions; and 5) to reduce the costs of abstracts and closings (H & F Land Inc. v. Panama City-Bay County Airport & Industrial District, 736 So. 2d 1167, 1171, Fla. 1999).  MRTA’s intent was to provide that, when record title to land exists for a designated duration, claims and interests in the property that arise from transactions before that period will be extinguished unless the claimant timely records a notice to preserve his interest.  MRTA contains a scheme to stabilize property law by clearing old defects from land titles, fixing a finite period of record search, and clearly defining marketability by extinguishing old interests of record not specifically claimed or reserved (§712.02, Fla. Stat).  Overall, MRTA is to be liberally construed to simplify and facilitate land title transactions by allowing persons to rely on record title.

Section 712.02, Florida Statutes, provides that “any person…vested with any estate in land of record for thirty (30) years or more, shall have a marketable record title…free and clear of all claims” except those set forth as exceptions in Section 712.03.  The Florida Supreme Court explained that the concept of MRTA is to extinguish all claims thirty (30) years or older which conflict with a record chain of title which is at least that old.  MRTA accomplishes its purpose by combining aspects of three areas of law (Marshall v. Hollywood, Inc., 236 So. 2d 114 (Fla.1970)).  First, MRTA acts as a statute of limitations which nullifies all interests which are more than 30 years old, subject to exceptions.  Secondly, MRTA actually invalidates interests rather than simply “curing” formal defects.  Finally, MRTA was designed to be a recording act, which provides a simple method by which the owner of an existing older interest may preserve it (City of Miami v. St. Joe Paper Co., 364 So. 2d 439, 442, Fla. 1978).  As the Supreme Court warned:

If he fails to take the step of filing the notice as provided, he has only himself to blame if his interest is extinguished.  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.

The preservation mechanism is found in Section 712.05, Florida Statutes, which permits any person claiming an interest in land to protect their interest from the operation of MRTA by filing a written notice.  Additional preservation mechanisms or options may now be found in Chapter 720, Florida Statutes, as a result of changes to the law in 2018.

The “Root of Title”

MRTA issues are tied to the concept of the “root of title.”  The root of title for a property is defined as any title transaction purporting to create or transfer the estate claimed by any person and which is the last title transaction to have been recorded at least 30 years prior to the time marketability is being determined.  The effective date of the root of title is the date on which the document was recorded.  Banton v. City of Pinellas Park, 887 So. 2d 1224, 1227 (Fla. 2004).  In other words, the root of title is the “most recent deed or other title transaction recorded in the unbroken chain of title at least thirty (30) years in the past (Id. at 1228).

Determining the root of title requires an understanding of what is considered to be a “title transaction.”  A title transaction “means any recorded instrument or court proceeding which affects title to any estate or interest in land and which describes the land sufficiently to identify its location and boundaries.” (§712.01(3), Fla. Stat.)  To be considered a title transaction, the instrument would not only affect title, but also be within the chain of title of the property involved, to avoid being extinguished (Berger v. Riverwind Parking, LLP, 842 So. 2d 918, 922 (Fla. 5th DCA 2003). According to Berger, covenants and restrictions are not considered an estate, interest, claim, or charge affecting title.

Under MRTA, all claims against real property which pre-date the root of title and which have not been preserved by the filing of an effective Notice pursuant to Section 712.05, Florida Statutes or Chapter 720, Florida Statutes, or which are not subject to an exception as provided in Section 712.03, Florida Statutes, are extinguished.  MRTA applies to easements, covenants running with the land, recorded covenants and restrictions for planned developments, and any other interest in, or restriction on the use of, real property, which is not otherwise subject to an exception provided for by Section 712.03 (See, e.g.  City of Jacksonville v. Horn, 496 So 2d 204 (Fla. 1st DCA 1986) (MRTA used to extinguish unrecorded public right of way that had never been used); Holland v. Hattaway, 438 So. 2d 456 (Fla. 5th DCA 1983) (easement for access to a parcel of land is an estate in land and MRTA could be used to determine its marketability).  To avoid extinguishment, a document that constitutes a title transaction must expressly cite the Official Records Book and Page of the restriction being referenced, or state the name of the recorded plat that initially imposed the restriction (§712.03(1), Fla. Stat.; Sunshine Vistas Homeowners Ass’n v. Caruana, 623 So. 2d 490, 491-2 (Fla. 1993) (a 1925 subdivision plat provided a setback restriction which was sought to be enforced in 1990; the Court held the restrictions were not extinguished because the muniments of title specifically referenced the plat and stated that the conveyance was made subject to the covenants and restrictions of record); Berger v. Riverwind Parking, LLP, 842 So. 2d at 921).  If recorded restrictions are no longer enforceable because of MRTA, then merely having actual notice of them should not breathe new validity into them (Berger v. Riverwind Parking, LLP, 842 So. 2d at 921).  Additionally, actual notice does not protect restrictions created prior to the root of title from being extinguished (Id. citing to Cunningham v. Haley, 501 So. 2d 649, 652 (Fla. 5th DCA 1986)).

Do recorded amendments and/or amended and restated documents preserve covenants and restrictions under MRTA?

The short answer is generally no.  In the case of Berger v. Riverwind Parking, LLP, 842 So.2d 918 (Fla. 5th DCA 2003), the court implied in footnote 6 that an amendment referring to the original replat by book and page number and to the instrument creating the original restrictions would prevent extinguishment of the original restrictions under MRTA).  However, in Matissek v. Waller, 51 So.3d 625 (Fla. 2d DCA 2011), the Court found that the act of amending a document or restating it does not create a muniment of title.  The Court held that general language “…subject to all reservations, restrictions and easements of record…” was not enough to meet the requirements of 712.03. The documents were deemed to be extinguished.

Amendments (including amended and restated documents) do not automatically reset the clock for MRTA because they are not muniments of title that specifically reference the restrictions, either by book and page of record or by name of the recorded plat.  A muniment of title is any documentary evidence upon which title is based (Cunningham v. Haley, 501 So. 2d 649 (Fla. 5th DCA 1986) (restrictive covenants were extinguished under the MRTA and noting that “no title transaction imposing, transferring, or continuing the use restrictions in question . . . has been specifically identified in muniments of title in appellants’ chains of title since the date of the roots of title in each chain of title”)).  Muniments of title include deeds, wills, and court judgments through which land title passes and upon which its validity depends (Id).  Muniments of title do more than merely “affect” title; they must carry title and form a vital link in the chain of title (Id.).  Amendments do not transfer title to any estate and no title is dependent upon them.  As such, they do not on their own reset the MRTA clock.  However and as a result of changes to the law in 2018, amendments can now be used to preserve covenants for purposes of MRTA if they contain certain information, which information is generally not normally or otherwise required to be included in amendments to instrument.

If you believe your community or subdivision may need assistance with a MRTA issue, please do not hesitate to contact The Law Office of Douglas G. Christy, PLLC.