August 24, 2019

Colorado Supreme Court: Narrow Exception to Statute Voids Public Trustee’s Release of Deed of Trust

The Colorado Supreme Court issued its opinion in Shaw v. 17 West Mill St, LLC on Monday, June 24, 2013.

Real Property—Release of Deed of Trust—Fraudulent Request for Release of Deed of Trust—Recording Act—Bona Fide Purchaser.

Arguing that actual fraud is required under CRS § 38-39-102(8), Dennis Shaw and First Horizon Home Loan Corporation challenged the court of appeals’ ruling that “constructive fraud” is sufficient to void a request for a release of a deed of trust. The Supreme Court reversed, concluding that the statute creates a narrow exception that voids the public trustee’s release of a deed of trust only when proof of actual fraud is demonstrated by a preponderance of the evidence.

Summary and full case available here.

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