## Facts

- In 1941, then-owners executed a “filling station” lease granting Melvin Hall exclusive rights to supply gasoline and oil products on the premises and stating it would bind later owners.
- The lease was recorded in 1941, but the notarial certificate of acknowledgment was defective on its face because it did not show a statutory-compliant personal appearance and acknowledgment by the grantors.
- In 1950, Gilbert F. Willard purchased the property without actual knowledge of the lease.
- In 1952, M. E. Hatcher purchased from Willard when the filling station was closed; Hatcher saw unused filling-station equipment and was told Hall owned it.
- About two months after closing, Hatcher first learned of the lease when Hall attempted to enforce it against him.
- Hatcher filed a declaratory-judgment action seeking a determination that the lease was not a binding encumbrance; the trial court found Hatcher lacked actual or constructive notice and ruled the lease not binding as to Hatcher.

## Issues

1. Whether a recorded lease with a fatally defective certificate of acknowledgment imparts constructive notice to subsequent purchasers under Missouri recording law.
2. Whether visible filling-station equipment and the purchaser’s knowledge that a third party owned it imposed inquiry notice sufficient to bind the purchaser to the lease.

## Decision

- The Missouri Court of Appeals affirmed the declaratory judgment for Hatcher.
- The court held the lease’s defective acknowledgment prevented the recording from providing constructive notice to later purchasers.
- The court held the circumstances at purchase did not impose inquiry notice sufficient to charge Hatcher with knowledge of the lease.
- Because Hatcher purchased for value without actual, constructive, or sufficient inquiry notice, the lease was unenforceable against his title.

## Legal Principles

- Constructive notice from land records depends on compliance with statutory prerequisites for recordation, including a valid acknowledgment.
- An instrument affecting real estate that is recorded with a substantially defective (fatally defective) acknowledgment is treated as unrecorded as to subsequent purchasers for value without notice.
- Inquiry notice arises only when facts would cause a reasonably prudent purchaser to investigate; ambiguous conditions that do not reasonably indicate a specific encumbrance may be insufficient.
- A bona fide purchaser for value without actual, constructive, or inquiry notice takes title free of unrecorded or non-notice-imparting encumbrances.

## Conclusion

The court held that a lease recorded with a fatally defective acknowledgment did not provide constructive notice and, absent actual or sufficient inquiry notice, a later purchaser for value was not bound by the lease.


Hatcher v. Hall, 292 S.W.2d 619 (Mo. Ct. App. 1956)