Marketable Title

We’ll be going over the basics to marketable title in this post. Keep reading to learn more about marketable title and some of the curative measures Oklahoma law has built into place!

Oklahoma’s Title Examination Standards defines marketable title as “one free from apparent defects, grave doubts and litigious uncertainty, and consists of both legal and equitable title fairly deductible of record.” Let’s break this definition down. Marketable title affects real property ownership, which includes land and mineral interests. Remember that “holding title” means that you legally own something. For a refresher on the different ways to hold title, click HERE. Whenever real property is sold, title to the property is transferred to a new owner. When title is marketable, it means that title can be transferred to the new owner free and clear of any additional claims to the property by another party. It also means that there is no doubt as to the seller’s ownership to the property as well.

Marketable title is a pretty high standard to meet, but it does not mean that title has to be perfect. Remember that transfers of ownership are evidenced and recorded by deeds. Click HERE to learn more about the different types of deed that can be used to transfer ownership.  Even if there is a minor error in a deed, like a typo, title may still be considered marketable. Title is marketable so long as the intent of the parties is clear.

Sometimes errors or questions to ownership may arise from a title defect that occurred a very long time ago. Oklahoma has remedial statutes in place to help clear up certain title defects after a certain amount of time has passed, so title is considered marketable again, as long as no additional claims to ownership were raised. The first statute is called the Simplification of Land Titles Act, and it clears certain title defects (further outlined in the statute) after 10 years. For example, let’s say that a deed was executed by a company and was signed by an officer without authority to sign that deed. No one challenged the defect and the deed was filed of record. After 10 years, this defect is considered cured.

The next statute that Oklahoma has in place is called the Marketable Record Title Act. This statute can be used to cure a title defect extending back 30 years, so long as the chain of title remains unbroken and no claims have been made against its ownership. An unbroken chain of title is one where a conveyance or a connected series of conveyances have been of public record. For example, let’s say that Alan owned a farm. He conveyed it to Brad, but Brad never recorded his deed. Brad then conveys the farm to Chad, and Chad conveys the farm to Dave 20 years later. After 10 years, Dave then conveys the farm to Ethan, the current owner.

In this example, the title defect occurred when Brad failed to record his deed. Since the chain of title starting with Chad, however, remained unbroken for 30 years, Ethan now has marketable title as to the farm, despite this defect. Brad or any of his successors in interest are thus barred from making any claim to the farm.