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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN FRANK J. KELLEY, ATTORNEY GENERAL Opinion No. 6319 November 1, 1985 RECORDS AND RECORDATION: Memorandum of land contract REGISTER OF DEEDS: Duty to record memorandum of land contract without county treasurer's certificate as to tax liens and unpaid taxes on property A memorandum of land contract, duly executed and acknowledged by the parties before a notary public, is entitled to be recorded by the register of deeds in the county where the land is located without a certification by the county treasurer that there are no tax liens or titles on the property and that all property taxes have been paid for the five years next preceding the date of the instrument. Mr. Jack Scully Prosecuting Attorney Arenac County County Building Standish, Michigan 48658 You have requested my opinion on the following question: May a memorandum of land contract be recorded by the county register of deeds without certification by the county treasurer that there are no tax liens on the property and that all property taxes have been paid for the last 5 years? MCL 211.135; MSA 7.194, in pertinent part, provides: 'When any deed, land contract, plat of any townsite, village or addition to any townsite, village or city plat, or any other instrument for the conveyance of title to any real estate, is presented to the register of deeds of any county in this state for record or filing in his office, he shall require from the person presenting the same a certificate from the auditor general, or from the county treasurer of the county whether there are any tax liens or titles held by the state, or by any individual, against such piece or description of land sought to be conveyed by such instrument, and that all taxes due thereon have been paid for the 5 years next preceding the date of such instrument, and a certificate from the city, village, or township treasurer, wherein the lands are located, in any city, village or township collecting its own delinquent taxes or special assessments, whether there are any tax titles or certificates of tax sale held by such city, village or township, or by any individual, against such piece or description of land sought to be conveyed by such instrument, and that all tax titles, tax certificates, or special assessments sold thereon to the city, village or township certifying, have been redeemed for the 5 years next preceding the date of such instrument, and in default of the presentation of such certificate or certificates he shall not record the same until such certificate is secured and presented. . . . Provided, That the provisions of this section shall not apply to the filing of . . . any quitclaim deed or other conveyance containing no covenants of warranty; . . ..' The purpose of this statute is to expedite the collection of ad valorem taxes. Langford v Auditor General, 325 Mich 585; 39 NW2d 82 (1949). Under its plain terms, before a land contract may be recorded by a county register of deeds, the county treasurer must certify as required by MCL 211.135; MSA 7.194, whether there are any tax liens or titles against the land conveyed and that all taxes due upon the land described therein have been paid for the five years next preceding the date of the land contract. OAG, 1975-1976, No 4920, p 266 (January 26, 1976). An agreement which states the names of the parties, the description of the property, the mutual promises, the consideration, the terms of payment, and time of performance contains the essential elements of a land contract. Elbom v Pavsner, 225 Mich 213, 223; 196 NW 442 (1923), Baller v Spivack, 213 Mich 436; 182 NW 70 (1921), Brin v Michalski, 188 Mich 400, 406; 154 NW 110 (1915), Shipler Logging Co v Ponderosa Investment Co, 45 Or App 325; 608 P2d 211 (1980). A memorandum of land contract is an instrument executed for the purpose of reflecting the existence of a land contract and the vendee's interest in the real property subject to the underlying land contract. R. McCullen, Michigan Land Contract Practice, c 1, Nature of Land Contracts, Sec. 1.01, p 1 (1983). See also, Crowley v Modern Faucet Mfg Co, 44 Cal 2d 321; 282 P2d 33 (1955). In essence, a memorandum of land contract contains the names and addresses of the parties to the contract, the date of its execution, and the description of the property involved. It does not disclose the consideration involved, the terms of payment, the time of performance, nor the covenants of warranty. Sometimes, it is in the form of an affidavit of the parties to the land contract. As such, it is not a land contract requiring the requisite tax lien and 5-year tax certificate of the county treasurer as provided in MCL 211.135; MSA 7.194. Its basic purpose is to serve as evidence of an executed land contract. In the absence of covenants of warrant, the memorandum of land contract may not be considered to be a conveyance of title containing covenants of warranty. MCL 211.135; MSA 7.194. Thus, a memorandum of land contract which does not contain the consideration, the mutual promises, the terms of payment, and time of performance is not subject to the tax certificate requirement as provided in MCL 211.135; MSA 7.194. The inquiry, however, does not end there. 1 OAG, 1955, No 1944, p 462 (September 8, 1955), reviewed the authority of a county register of deeds to record affidavits and concluded that the register of deeds has a duty to record only those instruments authorized by law to be recorded. Land contracts executed in the presence of two witnesses and acknowledged before a notary public in accordance with MCL 565.351; MSA 26.671, are entitled to be recorded under MCL 565.354; MSA 26.674, in the office of register of deeds in the county where the lands lie. Research reveals no statute which expressly requires that a memorandum of land contract be recorded by a register of deeds. MCL 565.101; MSA 26.1271, provides that a qualified person who has an unbroken chain of title of record to any interest in land for 40 years shall at the end of that period be deemed to have marketable title to such interest in land subject, however, to such claims of interest in such lands which have been recorded during said 40-year period. Any interest, claim or charge against such land may be preserved and kept effective by filing for record with the reqister of deeds in the county where the lands lie during such 40-year period, of a notice in writing, duly verified under oath, setting forth the nature of the claim, interest, or charge. MCL 565.103; MSA 26.1273. It is to be noted that upon the execution of a land contract, the vendee is vested with equitable title, but that the legal title remains in the vendor as security for the payment of the full purchase price. Barker v Klinger, 302 Mich 282, 288; 4 NW2d 596 (1942). Furthermore, the Legislature has recognized the status of persons claiming equitable title to land by virtue of a recorded memorandum of land contract. They are eligible to sign petitions for proceedings to annex territory to a city. MCL 117.6; MSA 5.2085, as last amended, MCL 42.34(4); MSA 5.46(34)(4), as last amended. A memorandum of land contract may be considered a claim against land under MCL 565.103; MSA 26.1273. Thus, the memorandum of land contract is entitled to be recorded by the register of deeds in the county where the land is located. It is my opinion, therefore, that a memorandum of land contract which contains the names of the parties to the contract, the date thereof, and a description of the land involved, but which does not contain the terms of payment of the consideration, nor covenants of warranty, or the other mutual undertakings of the parties, if duly executed and acknowledged by the parties before a notary public, is entitled to be recorded by the register of deeds in the county where the land is located without a certification by the county treasurer that there are no tax liens on the property and that all property taxes have been paid for the five years next preceding the date of the instrument. Frank J. Kelley Attorney General
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