Also known as: bona fide purchases · BFP · bona fide purchaser
Written by attorneys · grounded in primary & secondary sources — see below
A purchaser who acquires property for value in good faith and without notice of prior adverse claims. Such a purchaser receives priority over unrecorded interests under applicable recording statutes and takes free of certain defects that would otherwise affect title.
MetroMall Corp sold a shopping center to Horizon Retail REIT for fair market value. Horizon conducted a title search and found no recorded claims from the Carter Family Trust, which held an unrecorded equitable interest from prior construction financing. Horizon took title and began collecting rent from tenant Urban Threads LLC. The trust's claim yields because Horizon qualifies as a bona fide purchaser without notice.
Bradley Banks purchased land from a seller who had previously conveyed an unrecorded interest to Belinda Baxter. Visible signs on the property indicated Baxter's prior use, prompting further inquiry that Banks ignored. Banks recorded first under a race-notice statute. Baxter prevails because Banks had inquiry notice and therefore never qualified as a bona fide purchaser.
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Bobby Brady obtained a vehicle by fraud from its owner and immediately sold it to Byron Bishop, who paid value and had no knowledge of the fraud. The original owner later located the vehicle in Bishop's possession and sued for conversion. Bishop is protected as a bona fide purchaser and defeats the conversion claim.
A forger executed a deed conveying Blackwood Technologies' land to a sham buyer who then conveyed to Bayside Shipping for value. Bayside searched the records, found no defects, and recorded its deed. In a jurisdiction applying notice-type protection, Bayside holds good title against the true owner because it qualifies as a bona fide purchaser.
Barbara Bennett contracted to buy land from a seller who had an unrecorded prior claimant. Bennett paid half the price before discovering the conflict. The court awarded the land to the prior claimant but granted Bennett a lien for the amount already paid. Bennett receives protection only to the extent of her payments as a partial bona fide purchaser.
Brooke Bryant bought real property from a grantor who had previously granted an unrecorded interest to another party. Bryant paid fair market value, conducted a diligent title search revealing nothing, and recorded her deed promptly. The prior interest is cut off because Bryant meets every element of bona fide purchaser status under the recording act.
The purchaser must pay value, act in good faith, and take without actual or constructive notice of prior unrecorded interests. Failure on any element, such as inquiry notice from visible facts on the property, defeats protection under notice or race-notice recording acts.
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A subsequent purchaser who pays value and lacks notice acquires legal title superior to the prior equitable interest. The equitable claim is cut off and cannot displace the purchaser or tenants holding under that title.
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A forged deed is void and passes no title from the forger. In some jurisdictions a subsequent purchaser without notice who records may still receive protection under the recording act depending on the type of statute and chain-of-title rules.
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The court may award the land to the prior claimant yet grant the installment purchaser a lien equal to payments already made. This limited protection treats the purchaser as a bona fide purchaser only to the extent of value actually paid.
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…person, the beneficiary has a full right to follow such property into the hands of such person, unless that third person is a bona fide purchaser, for a valuable consideration, without notice. ( Oliver v Piatt , 3 How [44 US] 333; 3 Scott, Trusts [3d ed], §§ 208, 291). If the fiduciary has invested the property or its proceeds into…