David and Veronica Allen bought land in Independence, Missouri, during 1994 for $22,000. In January 1998, they listed it for sale with a broker, Chuck Zuvers, asking $88,000. The property remained on the market until May 1999, when Thomas C. Scott contracted to buy it for $90,000. Scott signed the sales contract as "Thomas C. Scott, or assigns" because he was organizing Scott, Hewitt & Mize as a

Question

limited liability company and wanted the land deeded to the firm. At closing, and following Scott's instruction, the Allens deeded the property to "Scott, Hewitt & Mize, LLC." Although Scott and his partners had filed articles of organization for Scott, Hewitt & Mize with the Secretary of State before closing, the Secretary of State rejected the articles because of errors contained in them. Scott corrected the errors, and the Secretary of State issued a certificate of organization to Scott, Hewitt & Mize nine days after closing. ?The deed was recorded under the LLC's name, but the LLC did not exist. Which of the following statements is correct?
A)?The deed is still valid and the LLC holds title since the Secretary of State certified the LLC nine days after closing.
B)?There is a gap in the chain of title because of a transfer to grantee without legal status.
C)?The chain of title is fixed if the LLC re-records the deed.
D)?A deed can be recorded in the name of an existing or quasi-existing entity.

Answer 1

B