We recently reported on the case of Dept. of Transportation v. Haggerty 492 S.E.2d 770 (N.C.App. 1997) which presented the issue of implied dedication by unrecorded plats. We have a new decision from the North Carolina Supreme Court in Department of Transportation v. Humphries, 496 S.E.2d 563 which reinforces the Connor Act and clarifies the law with respect to the Department of Transportations position regarding their unrecorded rights-of-way. The Department of Transportation has long maintained that they have good title to the full width of right-of-way agreements executed, but unrecorded, prior to 1959 even if they have not maintained the right-of-way to the full width. The case arose out of a condemnation action filed by the Department of Transportation against the defendants. It was heard upon discretionary review prior to a determination by the Court of Appeals. Plaintiff claimed a right-of-way, 75 feet in width as measured from the centerline, existed across defendants property pursuant to an unrecorded right-of-way agreement. Defendants, as bona fide purchasers for value, acquired the property in issue by a description placing the boundary 30 feet from the centerline of North Carolina Highway 150. None of the deeds in defendants chain of title refers to the right-of-way agreement.
On March 20, 1952 the Department of Transportation obtained a right-of-way agreement from one of defendants predecessors in title that was not recorded, but was kept on file in the office of the right-of-way branch of the Department of Transportation in Raleigh. The Department of Transportation did not maintain beyond 30 feet from the centerline and the defendants placed improvements between the 30-foot line and the 75-foot line. In addition the 75-foot line comes within one foot of the defendants residence.
The trial court determined that the Department of Transportation was not required to record the right-of-way agreement because of N.C.G.S. Sec. 47-27 and therefore had a valid right-of-way. On appeal the Department of Transportation contended that Dept. of Transportation v. Auten, 106 N.C.App. 489, 417 S.E.2d 299 (1992) and Kaperonis v. N.C. State Highway Commn, 260 N.C. 587, 133 S.E.2d 464 (1963) controlled the outcome of the case.
The Auten trial court ruled that prior to 1 July 1959 the Department of Transportation was not required to record right-of-way agreements. In a brief opinion the Court of Appeals concluded that the holding in Kaperonis did not require the Department of Transportation to record prior to 1 July 1959 in order to hold a valid interest by virtue of N.C.G.S. Sec. 47-27. This court overruled the Auten decision, to the extent that it applied N.C.G.S. Sec. 47-27 finding that they had misconstrued the Supreme Court holding in Kaperonis. In Kaperonis the State had a 100-foot right-of-way from an unrecorded 1929 instrument but the landowners had record notice through a survey incorporated in a deed in their chain of title. This court points out that the decision rested on the record notice not on N.C.G.S. Sec. 47-27 and cites a line of subsequent cases that support the conclusion.
The Court then goes on to delineate the history of N.C.G.S. Sec. 47-27 which in its present form reads, in pertinent part, as follows:
"§ 47-27. Deeds of easements
All persons, firms, or corporations now owning or hereafter acquiring any deeds or agreement for rights-of-way and easements of any character whatsoever shall record such deeds and agreements in the office of the register of deeds of the county where the land affected is situated. ...
No deed, agreement for right-of-way, or easement of any character shall be valid as against any creditor or purchaser for a valuable consideration but from the registration thereof within the county where the land affected thereby lies.
From and after July 1, 1959, the provisions of this section shall apply to require the Department of Transportation to record as herein provided any deeds of easement, or any other agreements granting or conveying an interest in land which are executed on or after July 1, 1959, in the same manner and to the same extent that individuals, firms or corporations are required to record such easements."
The Court concludes that the last paragraph added in 1959 does not create an exception for instruments unrecorded prior to the amendment. The Court states "we are upholding the stated purpose of our recording statutes ... [a]s a pure race state, North Carolina focuses on recordation, above and beyond anything else."
This case is significant to practitioners because many surveyors believe that the States position in this case is the law and will survey boundaries in accord with claimed right-of-way lines instead of what the land records show. If these surveys are incorporated in the deed description of transfers it may vest title in the State.