General Laws c. 93, § 70: Statutory Requirements

and Practice Norms

The Title Certification Statute

Most real estate attorneys know that G.L.c. 93, §70 (“the Title Certification Statute”), requires them to certify title in certain circumstances, but many attorneys do not really the what the Title Certification Statute requires or what the limits of their liability under it might be.

Requirements of G.L.c. 93, §70

Certification of Title to the owner and lender must be based upon a title examination covering “a period of at least fifty years with the earliest instrument being a warranty or quitclaim deed which on its face does not suggest a defect in said title.” The Certification Statute is embodied in Real Estate Bar Association (“REBA”) Title Standard No. 1.

Applicability of the StatuteG.L.c. 93, §70 applies to any:

one to four family dwellingpurchased by an owner occupantwho grants a purchase money mortgage.

G.L.c. 93, §70 does not apply to:

acquisitions of vacant land;refinance transactions;cash transactions;commercial transactions.

Contents of the Title Certification

The attorney conducting the real estate closing must certify to the owner that he holds “good and sufficient record title to the mortgaged premises free from all encumbrances.”

The attorney must also certify to the purchase money lender that it holds “good and sufficient record first mortgage to the premises.” Matters that area excepted from the Title Certification must be clearly stated.

Blanket exceptionsnot allowed

Title Certification may not contain a blanket exception with a broad, general description of exceptions such as “all matters of record” or “all easements and restrictions of record. “ REBA Practice Standard No. 23, adopted May 11, 1999.

Limitation of Liability

The attorney who issues a Title Certification remains liable to the owner in the amount of the consideration on the deed for as long as the mortgagor owns the property, and

remains liable to the mortgagee in the original principal amount secured by the mortgage for the life of the mortgage loan.

Penalties for Noncompliance

An attorney’s willful failure to render a Title Certification to the owner as required under G.L.c. 93, §70 constitutes an unfair or deceptive act or practice that subjects the closing attorney to liability under G.L.c. 93A.

It is best practice to provide the Title Certification to the owner and the purchase money mortgage lender at closing.

Practice Norms

Attorneys often ask if they may rely upon title searches beginning with the Deed to the developer of a subdivision, the Deed to the declarant of a condominium, or upon on an existing policy of title insurance.

Attorneys also ask if the limited title search should be disclosed on the Title Certification.

Industry Accommodation

CATIC permits a mortgagee’s policy of title insurance to be issued on a limited title examination (or an existing policy) under certain conditions.CATIC’s authorization to rely on a limited search (or an existing policy) is for the purpose of issuing a mortgagee’s policy of title insurance only, and does not apply to the requirements of G.L.c. 93, § 70.

Recommended practice

It is difficult to say with certainty whether the disclosure of a limited title search in a Title Certification satisfies G.L.c. 93, §70.Many experienced conveyancers opt to purchase certifications from attorneys who have completed full examinations of the property that is being conveyed.

Do you have questions? Call CATIC!