Title Tips by Tute
Volume 13, Number 1
In the course of a recent title examination, I found the following fact pattern. Property was owned by husband and wife. The local government recorded a plat showing an easement they were going to acquire. Shortly after the plat was recorded, the owners recorded a deed of gift to their son, noting the gift was “subject to” the city easement. Shortly thereafter, the parents conveyed the easement shown on the plat to the locality.
Is there a difference between “less and except” and “subject to” in conveyances?
Button, button, who has the button
Tute attended a continuing education seminar last year in which the speaker analogized some estate administration issues to Three Card Monte, but, except for some of my more libertarian friends, this is the first time Tute has seen the concept applied to a local government. The concept you described has appeared in several titles it has been Tute’s pleasure to examine, but has been executed with varying degrees of artfulness. In some of the more elderly titles, the deed of acquisition and the purchase money deed of trust referenced in the deed were recorded months apart, sometimes the bank went to the courthouse first, other times the purchaser got there first. In some commercial transactions, the seller went to great pains to reserve to itself the proceeds of the pending eminent domain proceeding, by excluding from the conveyance not only the land being acquired, but also reserving the right to make the conveyance and receive the proceeds.
From the title examiner’s perspective, there shouldn’t be a whole lot of difference between the two concepts. Every conveyance is “subject to” its title history. That is the foundation of the concept of constructive knowledge, which is obtained by a purchaser through its (or its title attorney’s or its title insurer’s) examination of the land records. Tute’s off-hand response is that the use of “less and except” may be used when the seller is focused on describing the boundaries of the property being sold, while “subject to” would be used by a seller focused on describing what they had done to the property.
Typically, Tute sees the phrase “less and except” used when the entire fee simple interest in a portion of the property was conveyed away. A seller, having purchased five acres and having sold two, describes the property as WHAT I GOT less and except WHAT I CONVEYED AWAY. The phrase “subject to” seems to be typically used when the boundaries remain the same, but the seller has encumbered all or a portion of the property in some way: by creating a lien, conveying an easement or conveying some interest less than a fee simple, such as a leasehold estate for a term of years. In that situation, the seller conveys WHAT I GOT subject to THE INTEREST CONVEYED. Where multiple interests were conveyed away (for example, a conveyance to VDOT in fee simple for the roadway, together with various easements for drainage or utility relocation), the use of either phrase should trigger an examination of whether the referenced conveyance altered the boundaries, merely encumbered a portion of the land, or both.
When a seller conveys property “less” the portion sold, or “subject to” the prior sale, the buyer should be getting the same thing. Title insurers primarily distinguish the two concepts by placing “less and except” language in the Schedule A property description and adding “subject to” matters in the Schedule B exceptions. So the short answer for title examiners is “report it.” Title examiners can find additional insights at the end.
Enough common sense. For those underwriters (or underwriting counsel who understand that Tute attended the School of Hard Knocks, but didn’t stick it out until graduation) hoping for the “right” answer, the next stop is a dictionary.
Dictionary.com shows two definitions for “subject to.” In the first, the usage is described as “liable or likely to suffer from or be affected by” and the example given is “He is subject to colds; The programme is subject to alteration.” In the second, the usage is described as “depending on” and the example given is “These plans will be put into practice next week, subject to your approval.” It had no entry for “less and except” but the site very helpfully informed Tute the words were spelled correctly.
Merriam Webster (http://www.m-w.com) had no entries for “subject to” but six entries for “subject.” In the entry for the noun form, the etymology of the word is described as “Middle English suget, subget, from Anglo-French, from Latin subjectus one under authority & subjectum subject of a proposition, from masculine & neuter respectively of subjectus, past participle of subicere to subject, literally, to throw under, from sub- + jacere to throw.” Under the adjective form was found the following: “1 : owing obedience or allegiance to the power or dominion of another . . . 2 a : suffering a particular liability or exposure
b : having a tendency or inclination : PRONE
. . . 3 : contingent on or under the influence of some later action
.” The concept of “less and except” was again missing.
So Tute went the extra step and looked up the words individually. In the preposition form (does anyone want to hear a discussion on the misuse of less as a modifier for plural, rather than collective nouns? Tute didn’t think so), less is defined as “diminished by” or “minus” and except is defined as “with the exclusion or exception of” (don’t you hate it when the dictionary uses one form of the word to define the word?).
Since we’re worried about “Three Card Monte” consequences, a review of at least one law dictionary seems essential. Dictionary.law.com focused on the encumbrance aspect of subject to,” and discussed the concept of personal liability regarding (assumption of) the underlying debt. Again, “less and except” are missing in action.
Bouvier’s Law Dictionary (1856 edition, courtesy of www.constitution.org) had no entry for “subject to” (although it was a pleasure to run into the term subinfeudation again - don’t get excited, the practice was abolished by the statute Quia Emptores in the late 1200s). Less and except was still absent, but exception, especially in the context of contracts, appeared helpful.
EXCEPTION, contracts. An exception is a clause in a deed, by which the lessor excepts something out of that which he granted before by the deed.
2. To make a valid exception, these things must concur: 1. The exception must be by apt words; as, saving and excepting, &c. 2. It must be of part of the thing previously described, and not of some other thing. 3. It must be part of the thing only, and not of all, the greater part, or the effect of the thing granted; an exception, therefore, in a lease, which extends to the whole thing demised, is void. 4. It must be of such thing as is severable from the demised premises, and not of an inseparable incident. 5. It must be of a thing as he that accepts may have, and which properly belongs to him. 6. It must be of a particular thing out of a general, and not of a particular thing out of a particular thing. 7. It must be particularly described and set forth; a lease of a tract of land, except one acre, would be void, because that acre was not particularly described. (citations omitted)
3. An exception differs from a reservation; the former is always a part of the thing granted; the latter is of a thing not in esse but newly created or reserved. An exception differs also from an explanation, which by the use of a videlicet, proviso, &c., is allowed only to explain doubtful clauses precedent, or to separate and distribute generals, into particulars. (Citations omitted)
So Tute dragged Black’s Law Dictionary (Revised Fourth Edition, 1968) out of storage (doesn’t everyone have a Black’s in the garage?) and found “subject to” defined as “liable, subordinated, subservient, inferior, obedient to; governed or affected by; provided that; provided; answerable for.” (Citations omitted.) “Less and except” is once again absent (are you starting to worry that that isn’t the proper phrase?). Except was defined as “but; not including, other than, otherwise than; reserve; to exclude from an enumeration, the scope of statement or enactment, a privilege; to leave out of account or consideration.” “Except right of way” noted “recitals ‘less the right of way’ and ‘except right of way’ in granting clause of deed have well-defined accepted certain and unambiguous meaning by which grantor conveys entire interest in servient estate and at same time expressly recognizes and acknowledges dominant estate.” Remembering an ancient formulation, Tute also looked under “save and except” and found save defined as “to except, reserve or exempt.”
Tute was astonished to discover that the phrases “less and except” and “save and except” appear infrequently in Virginia jurisprudence in close proximity to the word defined or definition (or perhaps Tute needs to work on search algorithms?). In one 1928 case, the term “save and except” was not defined, the court was construing the rest of the sentence to find out exactly what actions were excluded from policy coverage. Miller Co. v. Aetna Ins. Co., 150 Va. 495, 143 S.E. 747 (1928).
Relying on 83 C.J.S., Subject, page 555, the expression “subject to” was defined by the Virginia Supreme Court in Nusbaum and Co. v. Atlantic Realty, 206 Va. 673, 679-680 (1966), as follows:
“It normally connotes, in legal usage, an absence of personal obligation, and as ordinarily used does not create affirmative rights.” Helvering v. Southwest Consol. Corporation, 62 S. Ct. 546, 551, 315 U.S. 194, 86 L. Ed. 789; Shell Oil Co. v. Manley Oil Corporation, 124 F.2d 714, 716.
That general observation does not cover every case, however. See, for example, Davis v. Henning, 250 Va. 271 (1995) in which the court noted “subject to” is consistent with acknowledging an existing right which is excepted from the transfer, thereby continuing an existing limitation on the grantee's fee simple ownership of the dirt road. It is inconsistent with creating or recreating a right not in existence and reserving that right for the grantor's benefit. Cf. Corbett, 223 Va. at 471, 290 S.E.2d at 849 (“hereby create and establish” sufficient to create easement). The courts look to what the words express, not what the grantor may have intended to express. Browning v. Bluegrass Hardware Co., 153 Va. 20, 26, 149 S.E. 497, 498-99 (1929). Davis v. Henning, 250 Va. 271, 275 (1995). In that case, since the easement the grantor was attempting to retain had terminated by operation of law, there was nothing left of it to which the conveyance could be subject, and that choice of words proved to be less than artful.
Another interesting question, one which follows naturally from your question, is what if the interest the recorded conveyance attempted to “less, save and except” or to which it was made subject was never recorded? Looking over the requirements set out in Bouvier’s Dictionary and the comments in the Davis case, Tute would likely report as an exception from coverage that interest to which the property described in the conveyance is said to be “subject to.” Both those sources indicate “subject to” is appropriate language to identify an existing interest. It would (in the humble opinion of this lowly examiner) be an invitation to litigation to insure the interest in question in the hands of the (if named) third party. Tute works often with an irascible curmudgeon who has been know to wonder out loud if those #&$!_ !@@^()#@ realize what they’re doing to their titles by refusing to record their leases, and why do they expect title insurance since Schedule A of the policy says “Title to the estate or interest in the land is vested in: ___”. (tut, tut, boss, I didn’t use words like that to describe you! – of course, you didn’t know you were speaking for attribution) As they eyes and ears of the insurance company Tute also wonders why an insurer should pay the litigation expenses to quiet or prove title to an interest the parties didn’t value enough to pay the recording taxes due upon recording which would protect it from claims of third parties? That money could be better spent on raising examiner’s salaries!!
I don’t know if I’ve beaten that horse to death or not, but I’ve certainly run up against my editor’s space limitations. This was fun. Keep those cards and letters coming (e-mail works too! firstname.lastname@example.org).