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SUPREME COURT, STATE OF COLORADO Court Address: 2 East Fourteenth Avenue Fourth Floor Colorado State ... - page 9 / 22





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notice, a principle of Colorado law that has been repeatedly upheld and reaffirmed by our courts.

The legislative intent that the record title be relied upon will be frustrated if priority of interests

depends on whether or not a junior lienholder's agent (the title company) failed to identify a

recorded interest. If the decision is not reversed, then from now on the record will control

priority where there was no negligence by a title company, and priorities of liens and interests

will be rearranged in cases where a title company didn't find a properly recorded document.

Under Colorado law, a judgment creditor is treated as a good faith purchaser or

encumbrancer for value. Sky Harbor, Inc. v. Jenner, 164 Colo. 470, 475-476, 435 P.2d 894,

896-97 (1968.) In Wedman v. Carpenter, 65 Colo. 63, 173 P. 57 (1918), the Colorado Supreme

Court said, "As between the negligent encumbrancer and an innocent purchaser for value, the

former must suffer." Id., 65 Colo. at 66, 173 P. at 59. In this case, then, Hicks is the "good faith

purchaser for value" and Chase Manhattan is the "negligent encumbrancer." But for the

negligent search of the public records by Chase Manhattan or its title agent, the lien in favor of

Hicks would have been found.

The case of Mooring v. Brown, 82-A-2251, 1983 U.S. Dist. LEXIS 19365 (D.Colo.

Feb.9, 1983), aff’d, 763 F. 2d. 386 (10th Cir. 1985) involved the application of another equitable

principle, the "good faith improver doctrine" in another situation where a recorded judgment lien

was missed by a title company. The Moorings bought land subject to a recorded judgment lien

that they didn't know about, and built a house. They argued that under the good faith improver

doctrine they should be entitled to an equitable lien for the value of the improvements, and that

their lien should be superior to the judgment lien. The court, applying Colorado law, said that

they could not invoke the "good faith improver" doctrine because the judgment lien was


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