Case: Adverse Possession and Tacking under Void Deed of Trust

Crotwell v. T&W Homes Etc, LLC, 318 So. 3d 1117 (Miss. 2021).

In 1973, Lum conveyed forty acres to Crotwell by warranty deed and reserved a life estate. On June 8, 1998, Lum purported to convey one acre of the forty-acre tract to Prestage. Lum died on June 29, 1998. Prestage executed a deed of trust covering the one-acre tract in 2006 that eventually was assigned to Wells Fargo. Prestage built and occupied a house on the property. Prestage defaulted on the loan, and on August 10, 2011, the substituted trustee on behalf of Wells Fargo foreclosed on the deed of trust. T&W Homes (“T&W”) was the high bidder at the sale and the trustee executed a trustee’s deed to T&W. After the foreclosure sale Prestage abandoned the one-acre property. Crotwell brought an action to confirm her title to the one-acre parcel in December 2011. Crotwell argued that Lum had only retained a life estate in the 1973 deed and did not retain any interest in the fee to convey to Prestage and that any rights that Prestage had in the one-acre parcel expired at Lum’s death in 1998 before Prestage executed the deed of trust. On interlocutory appeal, the Mississippi Supreme Court held that Lum only retained a life estate, affirmed the Chancery Court, and remanded the case for further proceedings. T&W Homes Etc, LLC v. Crotwell, 235 So. 3d 66 (Miss. 2017).

On remand, T&W argued that it had acquired title to the one-acre parcel by adverse possession since Prestage had acquired title by adverse possession, and T&W’s ownership since the foreclosure could be tacked on to Prestage’s ownership. Crotwell argued that the foreclosure sale was void since Prestage did not have any title and that T&W, as the purchaser at the foreclosure sale but not the beneficiary of the deed of trust, did not have privity with Prestage and so could not tack its time of possession to Prestage’s time of possession for adverse possession purposes. On the day before the hearing on the adverse possession issue, in October 2018, Prestage granted to T&W a quitclaim deed to the one-acre parcel. The Chancery Court held that Prestage had obtained title to the one-acre parcel by adverse possession, and even if the foreclosure was void, T&W had obtained title to the one-acre parcel by virtue of the deed from Prestage.

On appeal by Crotwell, the Mississippi Supreme Court, in a unanimous decision by Justice Kitchens, affirmed. The Court agreed with Crotwell that the deed of trust was void because Prestage did not have title to the one-acre tract when he executed the deed of trust in 2006, and that T&W, as the purchaser at the sale of a void deed of trust obtained no title. But the Court held that Prestage had obtained title by adverse possession beginning from the time that Lum died in 1998 until Prestage abandoned the property in 2011. Crotwell argued that Prestage subsequently lost title when he abandoned the property. The Court wrote that once Prestage had obtained title by adverse possession, title could be divested only by a conveyance or adverse possession by another party; “abandonment is not effective to divest the title to real estate.”

Note 1: In reading this case, it helps to remember that there are two adverse possession questions. The first is whether Prestage obtained title by adverse possession, and the second is whether the purchaser at the foreclosure sale, T&W, was able to tack its period of ownership to the Prestage’s period of possession.

Note 2: If one who has no title grants a deed of trust, and the grantor subsequently obtains title, shouldn’t the beneficiary of the deed of trust get the benefit of that title through the doctrine of after-acquired title? Or does the fact that the deed of trust was void from the start because the grantor had zero title mean that the deed of trust cannot be resurrected if the grantor subsequently obtains title? Does it make a difference whether the deed of trust expressly states that it covers any after-acquired title?

Note 3: A question that the case does not resolve is whether the time of possession of a purchaser at a foreclosure sale is tacked on to the grantor’s time of adverse possession. Crotwell argued that no tacking should be allowed because tacking requires privity of estate, and no privity exists between a grantor of a deed of trust and a purchaser at the foreclosure sale who is not the beneficiary. In this case the court held that T&W obtained title by virtue of the 2018 deed from Prestage, not through adverse possession, which made it unnecessary to decide this question.

Note 4: While a fee simple title cannot be lost by abandonment, it is possible for an easement to be abandoned. In Mississippi one seeking to assert that an easement has been abandoned must prove an actual intent to abandon or that there has been protracted non-use of the easement for an extended period of time, which creates a presumption of abandonment. See Bivens v. Mobley, 724 So. 2d 458, 461 (Miss. Ct. App. 1998); R&S Development, Inc. v. Wilson, 534 So. 2d 1008, 1010 (Miss. 1988). The editor has not researched this question, but he speculates that the rule for leases would be the same as the rule for a fee title, and that a leasehold estate could not be lost through abandonment, since a fee and lease are both estates in land, and an easement is not.