San Francisco
The Sea Cliff case is part of a broader problem involving property and deed fraud in the United States. Such schemes can target vacant houses, properties belonging to people who live outside the area, estates going through probate and other homes that may receive little day-to-day attention from their legitimate owners. A common method involves filing a forged quitclaim or grant deed that appears to transfer ownership to another person. Once the document is recorded, the person behind the scheme can use the public record to support a claim to the property. County recorder offices generally record documents that meet basic filing requirements rather than determining whether every ownership claim is genuine. The problem can become more complicated when someone physically occupies the property. Police officers responding to a complaint may see an official-looking deed and have limited ability to determine its validity at the scene. Lawmakers recently approved legislation requiring county recorders to notify property owners when deeds and other property transfer documents are filed against their parcels. The measure is intended to give owners a chance to challenge suspicious filings before a fraudulent transfer becomes more difficult to unwind. San Francisco’s case could now put that issue under greater focus. The city attorney’s lawsuit seeks a clear court ruling that the eight disputed deeds have no legal effect. A ruling in the city’s favour would clear the contested transfers from the property’s record and restore the ownership history to the last legitimate title holder. For neighbours around the Sea Cliff house, the case also represents an attempt to end a dispute that has already brought repeated police calls and concerns over the condition and security of the property. The court will now have to determine whether the eight deeds were valid transfers or fraudulent documents that should never have formed part of the property’s official record.
That means a fraudulent document can enter the public record before the legitimate owner discovers what has happened. California has also taken steps to give property owners earlier warning when documents affecting their homes are recorded.
San Francisco legal authorities have filed a lawsuit seeking to cancel eight disputed deeds tied to a $4.4 million house in the exclusive Sea Cliff neighbourhood, after officials described the case as an elaborate attempt to take control of the property. Because people occupying the property were able to point to recorded documents when police arrived, that problem became especially difficult in the Sea Cliff case. The disputed paperwork therefore helped the occupants maintain their claim while the ownership issue remained unresolved. Because its registered owner lives overseas and was difficult for residents to contact, the vacant home had become a source of concern in the neighbourhood, particularly. Because the occupants continued to rely on property documents recorded with the city, repeated calls to police and other city agencies did not immediately settle the dispute.
The dispute grew after neighbours reported that people had entered the vacant house, changed its locks and used disputed documents to claim ownership. Neighbours reported repeated police visits to the house. Neighbours reported overgrown vegetation, poor maintenance and people coming and going from the property. The San Francisco Standard reported that neighbours had raised concerns about the condition of the property and the activity around it before the city attorney’s office took legal action.
The trouble began after the long-term registered owner, who lives abroad, left the property empty, according to court filings detailed by The San Francisco Standard. The City Attorney’s Office says the repeated filings created a serious problem for San Francisco’s property records. San Francisco City Attorney David Chiu filed the case in state court, seeking to clear the city’s property records and restore the title to its rightful owner. The legal action follows more than a year of disputed quitclaim deeds, questionable ownership transfers and claims by people who allegedly had no legal right to the house. The property sits in one of San Francisco’s wealthiest neighbourhoods, overlooking the Pacific Ocean. People then allegedly took advantage of the vacant house by filing a series of documents that created a false trail of ownership in public records. A fraudulent grant deed or quitclaim deed can place a false ownership history into official records. Even when a document is later challenged, it can create confusion for property owners, buyers, lenders and title companies trying to establish who legally owns a house. During some encounters, occupants reportedly produced deeds or other paperwork and argued that they were lawful owners or tenants involved in a private property dispute. Police officers responding to such calls cannot immediately determine whether a deed filed with the county recorder is genuine or whether a signature or notarisation has been forged. That can make it difficult for officers to remove people from a property without a court order. Residents living near the property pushed city authorities to intervene after months of complaints about the house and the people using it. The situation also created security concerns for people living nearby. City attorneys are now asking a court to decide the validity of the disputed documents rather than leaving the issue to be resolved through individual police calls or private disputes. Under California law, city attorneys can take legal action involving public nuisances and seek court orders concerning documents that are alleged to have been fraudulently recorded. The city’s lawsuit asks the court to declare all eight disputed deeds void from the beginning. If the court agrees, the order would allow the San Francisco County Recorder’s Office to correct the public record and remove the fraudulent transfers from the property’s ownership history. The city is also seeking civil penalties against those responsible for preparing and recording the disputed documents, citing California laws against recording forged instruments.