hard · National Real Estate Exam
A seller signs a written contract to sell a parcel to Buyer A. Three days later, before recording or possession, the seller signs a second written contract to sell the SAME parcel to Buyer B, who knows nothing of the first contract. Buyer A records his contract first; Buyer B then closes, pays full value, and records his deed before Buyer A sues.
In a notice-race recording jurisdiction, which party prevails to title, and why?
- Buyer A, because his contract was the first to be executed and the seller could not convey what he had already contracted to sell
- Buyer A, because he recorded his interest before Buyer B closed, giving Buyer B constructive notice that defeats Buyer B's claim
- Buyer B, because the first contract is merely an executory equitable interest that a later bona fide purchaser for value can cut off only if no record notice existed
- Buyer B, because a subsequent deed always extinguishes a prior unrecorded contract regardless of which instrument reached the records first
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