Why Associations Must Be Aware of Changes to the Marketable Record Title Act

As discussed in more detail below, the State legislature amended the Marketable Record Title Act (MRTA) in 2019. While many community associations may not be familiar with the MRTA since its provisions historically have not affected community association living or administration, the 2019 amendments make it necessary for community associations to take note now before the true impact of this law takes effect on March 29, 2021.

Background: The Marketable Record Title Act

To establish “marketable title” to real property, an owner must establish that they have an “unbroken chain of title” to that property. A “chain of title” is the historic sequence of transfers of title to a property, with the “chain” running from the present owner back to the original owner of the property. An “unbroken” chain of title refers to having a deed or a series of deeds to the current owner with nothing in the record purporting to “divest” or take away the owner’s title to the property.

Prior to 1945, a complete search to establish a full chain of title could be cumbersome, potentially covering more than 100 years. Because of this, in 1945 the State legislature enacted the MRTA to permit title examiners to go back only 40 years, rather than to the original owner. If the title examiner could establish an unbroken chain of title for more than 40 years, the existing owner would have marketable title to the property free of interests older than this 40-year search period.

Purported Purpose of the 2019 MRTA Amendments

Prior to what is now the customary recording of a declaration or bylaws to establish common restrictions for entire subdivision and condominium communities, owners often included restrictions in the actual deed transferring the property. For example, a person selling portions of their property for residential development and wanting to ensure that the sold property continued to be utilized for residential purposes might have included a restriction in the individual deed to the purchaser limiting the use of the property to “residential purposes.” Although this form of individual deed restriction is no longer as common, current deeds still often use generic statements like “subject to easements and restrictions of record,” which effectively incorporates the older deed restrictions by reference.

Utilizing the above example, some title companies were concerned that, even if the “residential purposes” restriction was only referenced in a deed recorded outside the 40-year period, a generic statement like “subject to easements and restrictions of record” contained in a deed to the property recorded within the 40-year period, incorporated the “residential purposes” restriction, effectively making the 40-year MRTA provisions worthless. That is, even though the “residential purposes” restriction was not included in a deed recorded within the 40-year time period, some title examiners believed this type of generic incorporation by reference made it necessary to expand the title search beyond the 40-year period despite the MRTA provisions.

To address this concern, the State legislature amended the MRTA effective March 29, 2019. Under these amendments, for a generic incorporation by reference like “subject to easements and restrictions of record” to validly preserve a restriction recorded outside the 40-year period, a document recorded within the 40-year period must specifically reference the liber and page of the document containing the restriction that is recorded outside the 40-year period.

Potential Problems Created by the 2019 MRTA Amendments

Even though the language contained in the 2019 MRTA amendments appear to only apply to restrictions contained in property deeds recorded outside the 40-year period, there are many real estate professionals who argue that the 2019 MRTA amendments would also void restrictions contained in subdivision declarations or condominium master deeds/bylaws recorded more than 40 years ago. These commentators point to the legislative history for the MRTA amendments, which includes discussions that homeowner association restrictions older than 40 years could be extinguished if the MRTA notice of claim provisions were not complied with.

While references to eliminating aged homeowner association restrictions did not make it to the final form of the MRTA amendment, the discussion is still a part of the written legislative history and current commentary. We believe that some will attempt to utilize this legislative history to support the position that the legislature intended to render aged homeowner association restrictions unenforceable.

Steps Associations Should Take: Amendment and/or Notice of Claim

While we believe the above-referenced commentators are incorrect for many reasons, we do not believe associations should take the chance that the recorded community restrictions will be wiped out and deemed unenforceable if challenged on this basis by an enterprising owner. Given the potentially significant and detrimental consequences of the 2019 MRTA amendments, and unless condominium and subdivision homeowner restrictions are explicitly exempted, we recommend that, for communities where restrictions were recorded more than 40 years ago, associations proceed with the following before March 29, 2021: (1) an amendment to their recorded restrictions approved by the requisite number of owners, which extends and reaffirms the restrictions and other document provisions; and/or (2) the filing of a “Notice of Claim” to be recorded with the Register of Deeds, which includes, among other things, a statement preserving the restrictions, the restriction recording information, and a copy of the recorded restrictions.


The amendment to the MRTA provides a 2-year window for recording an approved amendment to the recorded restrictions or the Notice of Claim to preserve the restrictions, with that timeframe expiring on March 29, 2021.