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SUPREME COURT, STATE OF COLORADO Court Address: 2 East Fourteenth Avenue Fourth Floor Colorado State ... - page 8 / 22

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current statutory scheme, the Court of Appeals found that a purchaser and lender, otherwise

having valid claims against their title insurer, are entitled to sweeping equitable relief due to the

very fact of their title insurer's negligence.

Colorado's recording statute has been in effect, with numerous revisions, since 1861.

See, § 9, Colo. G.L., p. 65 (1861). In 1908 it only protected bona fide purchasers and

encumbrances claiming title from the same grantee. Caroll v. Kit Carson Land Company, 24

Colo. App. 217; 133 P. 148 (Colo. App. 1913). In its current form the statute provides the

following express direction:

No such unrecorded instrument or document shall be valid against any person with any kind of rights in or to such real property who first records and those holding rights under such person, except between the parties thereto and against those having notice thereof prior to acquisition of such rights. This is a race- notice recording statute. COLO. REV. STAT. § 38-35-109.

Furthermore, the current statute is subject to the terms of the 1927 "General Policy Regarding

Titles" as set forth in COLO. REV. STAT. § 38-34-101, which is the first section of Article 34,

"Rules of Construction." Thus, at the time the Capitol National Bank case was decided, the

recording act was less inclusive in terms of the interests that were protected, and the title curative

statutes, including § 38-34-101, had not yet been enacted. For these reasons, Capitol National

Bank is not controlling precedent, and the Court should defer to the legislative intent as well as

the common law interpreting the Recording Act since the case was decided.

Under Colorado law, unless "super-priority" is granted (such as for the lien for real estate

taxes, some mechanics' liens, and the lien for homeowner association assessments) priority of

interests is determined by the date of recording, except only in the case of those who knew of a

valid prior unrecorded interest. "Notice" for these purposes includes both actual and constructive

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