OPINION

JACOBS, JUSTICE[fn*] [fn*] Sitting by designation as Vice Chancellor under DEL. CONST., art. IV § 13(2).

The plaintiff, John A. Faraone, Esquire ("plaintiff" or "Faraone"), brings this action in his capacity as Executor of the Estate of Pauline Kenyon ("Pauline") against Pauline's son, Jay W. Kenyon ("Jay") and Centex Home Equity Corporation ("Centex"), a mortgage lender. While Jay lived with his physically and mentally infirm mother from December 1995 until her death in March 2001, he transferred more than $700,000 from her bank accounts to his wholly-owned corporation. Shortly before her death, Jay also caused his mother to transfer her home to him by quitclaim deed. Thereafter, Jay mortgaged the home to Centex, and only months later, defaulted on the mortgage.

On behalf of Pauline's Estate, Faraone seeks a money judgment against Jay in the amount of all funds that Jay transferred from his mother's accounts to himself. Faraone also seeks a decree invalidating and setting aside the quitclaim deed and the mortgage lien against Pauline Kenyon's home. Trial was held December 11-12, 2002 and February 3, 2003. This is the Opinion of the Court after post-trial briefing.

The Court concludes, for the reasons set forth herein, that: (i) Jay's transfers of funds from Pauline's accounts to himself constituted a fraud upon his mother as well as breaches of fiduciary duty that Jay owed to her; (ii) the quitclaim deed was void from its inception and never validly transferred title to Jay; and (iii) Centex, the mortgage lender, was not a bona fide mortgagee for value, because the deed was void ab initio and also because at the time of the mortgage loan, Centex had constructive notice that Jay's title to the collateral (the home) was defective. Accordingly, Pauline's Estate is entitled to an accounting and judgment in the amount transferred from Pauline to Jay's corporation, and the deed and the Centex mortgage are both void and will be set aside.

I. FACTS

A. Jay Moves Into his Mother's Home

In 1995, Pauline Kenyon was a 79 year-old widow. She had three children: two daughters, Judy Thompson and Joyce Zipfel, and a son, Jay Kenyon. In December 1995, Jay, who was then 48 years old, moved back from California to Pauline's home in Wilmington, Delaware to care for his mother, who was recovering from knee surgery.

At the time Jay returned to Delaware, Pauline was managing her own personal and financial affairs, and she also held a durable power of attorney for her sister-in-law, Doris Williams. Pauline had been acting as Doris' attorney-in-fact and guardian since 1993. By 1996, Doris was an aged and infirm widow who resided in the Shipley Manor nursing facility in North Wilmington.

Unfortunately, by early 1996, Pauline had become increasingly unable to manage her sister's property and funds. Accordingly, the administrator of Shipley Manor caused Pauline's daughter to file a petition seeking to replace Pauline as the guardian of Doris' property, in the Court of Chancery. The basis for the petition (as Shipley Manor's then-Director of Admissions, Kathleen Scott, testified) was that Pauline was unable to make appropriate decisions concerning her sister's accounts or the payment of her bills. Although Pauline objected to the petition and stated her desire to remain as her sister's attorney-in-fact, this Court ordered that Supportive Care Services replace her as the guardian of Doris's property on October 17, 1996.

Beginning in December 1995, Jay lived with his mother, Pauline, in her home. Before then, Jay had lived in California for several months, but before he moved to California, he had resided in a homeless shelter in Wilmington. During that period, Jay had a severe drug and alcohol addiction, which (he admitted) continued throughout the entire time (1995-2001) that he lived in Delaware with Pauline. In his deposition, Jay admitted that he consumed drugs costing up to five hundred dollars a day. At no time during the years that he lived with his mother did Jay ever hold outside employment. Nor during that period did he file any federal or state tax returns, as the law required.

In October 1996, Jay formed "Cobra Wear," a corporation he intended as a vehicle to market and sell sportswear. From its inception to the date of the trial, Cobra Wear never grossed more than three thousand dollars in any single year. During this time, Jay's only other source of income was $10,000 per year that he received from his aunt's trust fund, beginning in 1998. During that same period, Pauline's income was $1,485 per month from social security.

B. Jay Transfers His Mother's Funds To Himself

In December 1996, Jay began depositing monies from his mother's bank accounts into the account of his company, Cobra Wear. Even though Jay had no signatory power on Pauline's checking accounts, he nonetheless occasionally wrote and signed his mother's name on checks made payable to Cobra Wear. According to Jay, at other times his mother would sign the checks, but Jay failed to produce the checks at trial, despite discovery requests.

In December 1996, Jay deposited into his Cobra Wear account the sum of $8,000 that he had withdrawn from his mother's bank account. In 1997, Jay deposited $126,251, and in 1998, he deposited $123,662 into the Cobra Wear account. Except for $10,000 that came from his aunt's trust fund, all of those monies came from his mother's funds.

By May 1999, Jay had exhausted all of the funds in his mother's checking accounts. To solve his cash-flow needs (due to his unemployment), Jay then devised a scheme whereby he wrote a letter to the Retirement Savings Department of his mother's bank, requesting the bank to transfer $30,000 from his mother's retirement account to her checking account. Jay signed his mother's name to that letter. In July 1999, Jay wrote (and signed his mother's name to) a similar letter requesting $10,000, and in August, September, and October, he wrote and signed his mother's name to similar letters requesting that each month, $20,000 be transferred from his mother's retirement account to her checking account. Once those monies were desposited into Pauline's checking account, Jay would then write checks on that account made payable either to himself or Cobra Wear. All told, the monies transferred from Pauline's accounts to Cobra Wear in 1999 totaled at least $206,533.

C. Pauline's Dementia and Isolation from Her Family

At trial, Pauline Kenyon's sister, Delvina Joyce, testified that she tried on a regular basis to visit her sister, but was unsuccessful, because (unbeknownst to Pauline) the door locks at Pauline's home had been changed. By late 1999, Pauline had become very confused. At one point she telephoned Ms. Joyce in the middle of the night, apparently unaware that it was nighttime. In December 1999, Pauline had to be hospitalized for congestive heart failure, in addition to other physical problems. After being treated in the intensive care unit, she recovered sufficiently to be transferred first to a rehabilitation facility and then to Shipley Manor in mid-January 2000.

According to Kathleen Scott, who was Shipley Manor's then-Director of Admissions, by that point Pauline was unable to make decisions. Indeed (and as earlier noted) Pauline had been replaced as the guardian of her sister's property in 1996 for that very reason. During her December 1999 hospitalization, Pauline was diagnosed with dementia. Ms. Scott's assessment of Pauline Kenyon, upon her January 19, 2000 admission to Shipley Manor, was that Pauline had mild dementia with impaired judgment and was unable to make medical decisions for herself. On that basis, Ms. Scott prepared a certification for the attending physician's signature.

Before signing the certification, Pauline's physician, Dr. Bonner, ordered a consultation with psychologist, Dr. Owen Lugar. Based on that consultation, which occurred on January 27, 2000, Dr. Lugar's diagnosis was also dementia. Dr. Bonner then ordered a second examination, this time by a psychiatrist, Dr. Larry Durlosky. Based on that examination, which was completed on February 1, 2000, Dr. Durlosky concurred with Dr. Lugar's diagnosis of dementia. Based upon these three identical diagnoses of dementia, Dr. Bonner certified, in his attending physician's report dated February 11, 2000, that Pauline was unable to manage and care for her person and property. At trial, Dr. Bonner testified that Mrs. Kenyon's mental status never improved.

Aware of his mother's physical and mental condition, in late January 2000, Jay asked his attorney, Edward F. Eaton, Esquire, to prepare a Durable Power of Attorney for his mother to sign. At the trial, Mr. Eaton testified that he spoke with Pauline Kenyon by telephone a day or two before he went to visit her. On January 28, 2000, Mr. Eaton and Jay visited Pauline at the nursing home. There, Pauline signed a Durable Power of Attorney designating Jay as her attorney-in-fact. Mr. Eaton testified that he questioned Pauline and determined that she understood the nature of the document she was about to sign. According to Mr. Eaton, Pauline also understood that by giving her son her power of attorney, she would disappoint her other children. It is undisputed, however, that Pauline executed the power of attorney during the exact time frame in which she was diagnosed as suffering from dementia. Accordingly, the Court finds that notwithstanding Mr. Easton's observations of Pauline Kenyon, her execution of the Durable Power of Attorney could not have been the act of a legally competent person.

Pauline remained in Shipley Manor until September 8, 2000, when she returned to her home. Ms. Scott had made all the necessary arrangements for Pauline to return home on three or four earlier occasions during the two months that preceded Pauline's actual discharge, but on each of those occasions Jay failed to show up to take his mother home.

During calendar year 2000, Jay withdrew at least $207,359 from his mother's accounts. That amount included the cash surrender value of all her life insurance policies. It is undisputed that all those monies were deposited into Jay's Cobra Wear account.

D. Pauline Kenyon's Health Continues to Decline

From late 2000 until her death in March 2001, Pauline's physical and mental health continued to decline. Her sister, Delvina Joyce, testified that she had increasing difficulty contacting Pauline. Ms. Joyce would telephone Pauline's number, but the line would remain "busy" for hours. Occasionally strangers would answer the telephone and tell Ms. Joyce that Pauline did not want to talk to her. When Ms. Joyce went to visit her sister at home, she would be kept waiting at the door for long periods before she was allowed inside. Sometimes the front door would not be opened at all. Ms. Joyce also testified that strangers in her sister's home would question her identity, and at times they refused to allow Ms. Joyce to see her sister at all.

On Christmas, 2000, Ms. Joyce received a telephone call from Pauline, who sounded very confused. Ms. Joyce went to the Kenyon home and found her sister incontinent, lying in squalor, and with bedsores on her buttocks and heels. Pauline was then taken to and treated at the hospital emergency room, but was not admitted as a hospital patient.

On February 23, 2001, Ms. Joyce again visited her sister. This time she found Pauline in much worse condition. Pauline would not open her eyes, talk or eat, and her bed was soiled. At Ms. Joyce's insistence, Jay agreed to call his mother's doctor. Only then did he arrange for home nursing care that began two days later.

E. Jay's Plan to Deed the House to Himself

On February 26, 2001, Jay telephoned Dr. Bonner's office, and told Dr. Bonner that his mother had received a notice of unpaid back taxes. Jay asked Dr. Bonner to furnish him a physician's note stating that Pauline was competent to sign papers. At trial, Jay admitted that what he had told Dr. Bonner was false: his mother had never received any notice of overdue taxes, and the real reason that Jay called Dr. Bonner was that he (Jay) wanted to "make sure that there wouldn't be any repercussions when she wanted to sign the house over to me." Jay testified that Dr. Bonner's advice was that Pauline had dementia, but "by direct supervision of her power of attorney . . . so that she didn't get hoodwinked maybe by someone coming into the house . . . it was okay for her to sign," provided she was physically able.

Despite his mother's severely debilitated condition and dementia, Jay and his live-in companion, Cynthia Kirk, prepared a quitclaim deed that purported to transfer title to his mother's house from Pauline to Jay. On February 27, 2001, Kenyon caused his mother to sign that deed. The deed contained no description of the property being conveyed, nor did it recite any consideration. Pauline Kenyon's name and "signature," which was a weak, completely illegible scribble, appeared twice on the deed as the grantor.

After his mother signed the instrument, Jay took the quitclaim deed to the Recorder of Deeds. That office would not accept the deed for recording, however, because the deed did not contain the tax assessment parcel identification number required by 9 Del. C. § 9605(f). Kenyon then hand-wrote the tax identification number in the upper right corner of the first page of the deed, and the deed was then accepted for recording.

Only six days after she signed the quitclaim deed, Pauline Kenyon was taken by ambulance to the hospital on March 5, 2001, where she was found to be unresponsive and gravely ill with septic shock and congestive heart failure. Pauline was hospitalized and placed on life support systems, where she remained until she died on March 21, 2001.

F. Jay Mortgages the Property

Unbeknownst to any member of Pauline's family, sometime before February 19, 2001 — i.e., before the quitclaim deed had been prepared or signed — Jay had applied on-line for a mortgage on his mother's home. The mortgage lender, Centex, caused a title search to be done through Mortgage Information Services ("MIS"), whose title searcher, Frank Capasso, was a former Deputy Recorder of Deeds. Capasso attempted to search the title records under the name of Jay Kenyon, but discovered that the record owner of the property was Pauline Kenyon. In the course of his title search, Capasso also discovered several outstanding judgments of record against Jay Kenyon. On March 8, 2001, Capasso completed a second title search at the behest of MIS. This time, Capasso reviewed the quitclaim deed, noted his conclusion that the deed was deficient because he could not see the signatures, and then sent a copy of the deed and his notes to MIS. Capasso's notes do not reflect that he also alerted MIS to the absence of any property description. At trial, however, Capasso testified that he believed he had noted the absence of any property description as one of the deficiencies in the deed.

On March 29, 2001, Capasso performed a third title search, this time for General American Corporation ("GAC"), which became the eventual title insurer. Again Capasso furnished GAC a copy of the deed and pointed out that it appeared flawed because there was no property description and there was a problem with the signatures. Despite having been told of those deficiencies, and having viewed a copy of the deed, GAC decided to insure the title on behalf of Centex.

In his mortgage application, Jay reported that he had received income of $11,969.71 per month as an employee of Cobra Wear. At trial Jay admitted that that amount consisted almost entirely of funds that he had transferred from his mother's accounts. Centex did not learn of this during the approval process because Jay had applied for a "Limited Income Documentation" loan. For this type of loan, Centex required only the most recent twelve months' bank statements, and proof that Jay had owned a business for three years. David Rains, a mortgage underwriter for Centex, testified that Jay's loan application was average compared to others in this "sub prime" market, because borrowers in that category often have credit or documentation problems. Mortgage lenders to sub prime borrowers compensate for the greater credit risk by charging increased fees and significantly higher interest rates than are charged for standard mortgages. Ultimately, Centex determined that Jay qualified for — and Centex approved — a mortgage loan of $146,327 on the property.

G. The Mortgage Closing and Jay's Default

On April 16, 2001, Centex sent Victoria Sessions, a notary public of Harford County, Maryland, to the Kenyon home in Delaware to conduct the settlement on the mortgage. No Delaware attorney participated in the settlement or examined the closing documents beforehand. Because the outstanding judgments against Jay Kenyon, as well as the premiums for life insurance that he opted to purchase, had to be paid at the settlement, Jay received only $120,651 of net mortgage proceeds. Because he had no ($0) income, Jay was able to make only four monthly payments from the mortgage proceeds before he defaulted on the mortgage loan. Thus, in only four and one half months, Kenyon had spent all of the mortgage proceeds. H. Plaintiff's Actions as Executor

Pauline Kenyon's April 11, 1996 Last Will and Testament named the plaintiff, John Faraone, as her Executor. Faraone was granted letters testamentary on April 2, 2001, and ordered a title search of Pauline's property. That search disclosed the quitclaim deed. On April 16, 2001, the plaintiff wrote a letter to Jay, taking the position that the quitclaim deed was a nullity. Although he was on notice of plaintiff's position, Jay did nothing to stop the transfer to himself of the mortgage proceeds three days later. Plaintiff Faraone then filed this action on June 11, 2001, over two months before Centex recorded its mortgage on August 23, 2001. By that point Jay had stopped making the monthly mortgage payments.

II. THE PARTIES' CONTENTIONS AND THE ISSUES PRESENTED

The plaintiff asserts three claims in this action. First, he claims that a judgment must be entered in favor of the Estate, and against Jay, for all monies that Jay transferred from his mother's accounts beginning in December 1996 until her death in March 2001. The basis for this claim is Faraone's contention that Jay unlawfully exploited his dependent and infirm mother by (a) obtaining an invalid power of attorney to conduct his mother's affairs; (b) exerting undue influence over his mother while she was aged and debilitated, both before and after he obtained the power of attorney; (c) signing his mother's checks and letters to her bank, without her knowledge or authorization, for the purpose of exploiting her and absconding with all of her money; and (d) wrongfully causing his mother to transfer her home to him. This conduct, the plaintiff asserts, constituted not only an unconscionable abuse of the close and confidential (and fiduciary) relationship that existed between Jay and Pauline, but also it violated Delaware's Adult Protection Statute, 31 Del. C. § 3902 et seq.

Jay's defense to this claim is that his mother had been long aware of his drug and gambling problems, yet she wanted Jay to have a home to live in, and was willing to give him whatever assets he needed to help her son with his business, including transferring her home to him.

Plaintiff's second claim, which is asserted against Jay and Centex, is that the quitclaim deed to Jay must be set aside as void, and that title to and ownership of Pauline's home must be restored to her Estate. The bases for this claim are several. First, Faraone argues, Pauline was legally incompetent when she signed the quitclaim deed and, therefore, her transfer of the property was invalid. Second, Faraone claims, even if Pauline was technically competent, she signed the deed solely because of undue influence exerted by her son, who was his mother's fiduciary throughout that entire time. Third, Faraone contends that the quitclaim deed was a legal nullity and void from its inception, because at the time Pauline signed it, the deed contained no legal description of the property purportedly being conveyed, as 25 Del. C. § 121 required. The deed was, therefore, legally insufficient to transfer title. Moreover, the only arguable semblance of a property description — the tax assessment parcel identification number handwritten on the deed by Jay Kenyon — did not cure the deficiency, because that identification number was added (at the office of the Recorder of Deeds) after Pauline Kenyon had signed the deed essentially "in blank."

The plaintiff's third, and final, claim (asserted against Jay and Centex) is that the Centex mortgage lien is invalid and must be vacated, because (i) the deed to the property subject to the mortgage was void at the time of the mortgage loan, and (ii) Centex was not a bona fide mortgagee for value. Faraone contends that because the deed was invalid on its face, Centex was on inquiry notice of a potential cloud on the title to the property that was to secure the mortgage. Because the deed was facially void and because Centex took no steps to inquire into or to ascertain its validity, Centex is not entitled to the protections that normally are afforded a bona fide mortgagee for value in cases where the deed is merely voidable, as distinguished from being void.

In response to these claims, defendants Centex and Jay argue that the quitclaim deed to the property that constitutes the mortgage collateral is valid despite the deed's failure to follow the statutory form or to recite the consideration, despite the inconsistent (and repeated) signatures of the grantee, and despite the absence of any legal description of the property being conveyed. Centex's position is that the tax assessment parcel identification number that was handwritten in the upper corner of the deed was sufficient, in and of itself, to identify the property. Centex further contends that the technical irregularities in the deed do not defeat Centex's status as a bona fide mortgagee for value, because (a) those irregularities were not sufficient to put Centex on notice of any potential infirmity in Jay's title, and (b) Centex had no knowledge, actual or constructive, of Jay's wrongful dealings with his mother's assets.

Alternatively, Centex contends that even if the deed is determined to be invalid, it is merely voidable, not void. Therefore, Centex contends, it is entitled to all the protections accorded a bona fide mortagee.

These contentions raise three issues: (1) is Jay Kenyon liable to his mother's Estate for the monies and other assets that he took from her between 1996 and March 2001? (2) Is the quitclaim deed purporting to transfer title from Pauline to Jay legally valid and effective, or was it void from its inception, or (alternatively) only voidable? Finally, (3) was Centex a bona fide mortgagee for value, with the result that the Centex mortgage remains valid and enforceable even if the quitclaim deed is adjudicated invalid?

The Court turns to these issues.

III. ANALYSIS

A. The Claim For A Money Judgment

The Court first addresses the plaintiff's claim that Jay is liable to the Estate for the amount of the assets he expropriated from his mother by fraud, breach of fiduciary duty, and/or undue influence. Jay's defense is that his mother was fully aware of, and consented to, all of his financial transactions with her assets throughout the entire time that he lived with her.

Success on this claim turns on the nature of the relationship between Jay and his mother at the time of the transactions complained of, and the nature of the proof. Transactions of this character, if conducted by two independent persons with full information and relatively equal bargaining power, would not require court intervention. But where, as here, one of the parties occupies a fiduciary relationship to the other and abuses that position of trust and confidence to his own advantage, then equity will intervene to rectify the exploitation.

Courts have been reluctant to draw bright lines that cast in immovable stone a precise point where a fiduciary relationship will (or will not) be found to exist, at least in cases that do not involve well-recognized relationships, such as lawyer-client, trustee-beneficiary, or guardian-ward. Nonetheless, it may fairly be stated as a rule of thumb, that where one party has a relationship of superiority to another, and the other party's protections are based on investing trust and confidence in the person holding the superior position, those circumstances will give rise to a fiduciary relationship. For example, in one case, an elderly mother in poor health gave her daughter a portion (and loaned her the rest) of the proceeds from the sale of her home. In exchange, the daughter orally promised to care for and support the mother for the rest of her life. A dispute arose, and the mother was forced to move out of her daughter's home. The daughter (and son-in-law) refused to repay the loan or return the gift. Given the daughter's superior position, the mother's dependency, her lack of legal representation, and the decidedly beneficial nature of the transaction to the daughter, this Court found that the daughter was a fiduciary of her mother and granted relief.

Similarly, in Swain v. Moore, an elderly man (Swain), who lived alone and was in poor health, gifted his car and a substantial portion of his property to a young couple, based on an oral agreement whereby Swain would live with the couple in their home. The parties became estranged and Swain moved out. This Court found that, due to their superior position and the relationship of trust and confidence, the young woman and her husband were fiduciaries of Swain. The Court ordered the couple to return Swain's car and property.

Where a fiduciary relationship exists, "the law will presume fraud and the burden of showing fairness in connection with the transfer of property is on the person seeking to sustain the transaction. . . . This burden is even greater in the case of a transfer made without consideration." As former Vice Chancellor Hartnett stated:

[E]quity seeks to protect the aged and infirm from the designs of others and from their own improvidence. It therefore has the power to set aside deeds improvidently entered into, and to require the repayment of loans made by the aged to those in a fiduciary relationship to him.

Manifestly, at all relevant times Jay was a fiduciary of his elderly mother, who was in rapidly diminishing mental and physical health. In 1995, Pauline was a widow who lived alone and was in need of care and companionship. She had difficulty ambulating and could not drive a car. By late 1996, she had been judicially determined incapable of caring for her sister-in-law's property, because her (Pauline's) decisions were unsound. Beginning in 1996, Pauline depended entirely upon Jay to manage her affairs, to oversee the upkeep of the home, and to give her personal care and assistance as well as companionship. In these circumstances, it cannot be doubted that Jay occupied the status of his mother's fiduciary when the transfers of her money to his accounts began in 1996. Jay continued in that fiduciary role until his mother's death in March 2001.

Jay's defense is that his mother freely and voluntarily gave him everything she owned — her money and her home — because she wanted him to have it. But, this defense rests solely upon Jay's self-serving testimony which the Court, having observed Jay's demeanor at trial, finds entirely lacking in credibility. Moreover, there is no independent evidence, documentary or testimonial, that corroborates Jay's version of the facts. That defeats Jay's claim, because it was his burden, as a fiduciary, to satisfy the Court that all of his dealings in the property of his beneficiary (Pauline) were legally valid and equitably fair. Jay has not come close to meeting that burden.

If in fact Pauline had intended to give all of her worldly possessions to her son (assuming she was legally competent to do so), that objective could have been accomplished in a straightforward and lawful way, but this never occurred. What happened instead was that Jay forged his mother's signature on her checks and on letters that he wrote to the Retirement Savings Department of his mother's bank. In those letters, Jay, impersonating his mother, requested the bank to transfer large portions of her retirement funds to her checking account from which Jay withdrew the funds. That undisputed? and reprehensible? conduct is hardly consistent with an intent on his mother's part to give all her assets to her son. Indeed, such conduct evidences the precise opposite. For that reason as well, Jay has failed to sustain his burden to prove the validity and fairness of his self-dealing transactions in his mother's assets.

As Pauline's Executor, plaintiff Faraone asks this Court to invalidate the transactions and order an accounting and restitution. The Court determines that all of Jay's transfers of Pauline Kenyon's funds to himself through the vehicle of his Cobra Wear account or otherwise, during the time that he was her fiduciary, constituted a fraud and breaches of Jay's fiduciary duty of loyalty. Those transfers, accordingly, are invalid and void. B. The Claim To Invalidate The Quitclaim Deed

The plaintiff next claims that the quitclaim deed purporting to convey the property to Jay is void and must be set aside. This Court agrees, and finds the quitclaim deed is invalid on both legal and equitable grounds.

To begin with, the deed has legal deficiencies that render it legally void ab initio. In this context, the question is whether or not the deed contained a property description that was legally sufficient to transfer legal title from Pauline to Jay. That is a question of law. Normally, courts will construe property descriptions in deeds liberally to give effect to the intention of the grantor. But where, as here, a deed is wholly lacking in any description of the property being conveyed at the time it is signed by the grantor, the deed is legally ineffective to pass title. As the Georgia Supreme Court held in Hughes v. Heard, "[a] deed purporting to convey land which is so indefinite in description that the land is incapable of being located is inoperative either as a conveyance of title or as color of title."

Here, the quitclaim deed that Jay caused Pauline Kenyon to sign had neither any description of the property nor any other information that would have enabled a reader to identify the property being conveyed. On that basis alone the deed was void ab initio, as a matter of law. Although thereafter a tax identification number was handwritten on the deed, that addition did not cure the original invalidity, because the tax identification number (assuming without deciding that it would have sufficed as a property description) was not on the deed at the time the grantor signed it.

Centex argues that the deed form prescribed by 25 Del. C. § 121 is not mandatory, but only advisory, and that under § 121(b), non-conforming deeds are valid regardless of form. What Centex overlooks, however, is that § 121(b) validates deeds conveying "the property therein described." In this case there was no "property therein described" on the quitclaim deed at the time Pauline signed it.

Besides being void legally, the deed is also invalid equitably because at the time she executed it, Pauline had no legal capacity to do so. The overwhelming weight of the evidence, including the testimony of Dr. Bonner, Dr. Simpson, Delvina Joyce, and Joyce Zipfel, was that at the moment she scribbled her signature on the quitclaim deed on February 27, 2001, Pauline Kenyon was debilitated, demented, and unable to care for or protect herself or her property. Pauline had lost her capacity to make sound decisions in her best interest long before she signed the quitclaim deed, and she continued to deteriorate until she died on March 21, 2001, only 3 weeks after she signed the deed. Where, as here, a party to an agreement is without legal capacity to enter into a binding contract, the instrument is voidable at the behest of the incapacitated party.

The deed also is equitably void, because in addition to and apart from Pauline's incapacity, the deed was the product of fraud and a breach of Jay's fiduciary duty of loyalty. In early 2000, at the very time it had been medically determined that Pauline was demented and unable to manage and care for her person and property, Jay procured from Pauline a Durable Power of Attorney that made him his mother's attorney-in-fact. For the remainder of his mother's life, Jay held himself out as his mother's attorney-in-fact and acted in that representative capacity.

As his mother's attorney-in-fact, Kenyon assumed the formal status — and obligations — of a fiduciary. A power of attorney creates a fiduciary relationship not unlike that created by a formal trust. As a fiduciary, the attorney-in-fact is subject to a duty of loyalty that obligates the attorney-in-fact to act at all times in the best interest of the principal, unless the principal validly consents to some different conduct. A self-dealing transfer of the principal's property to the attorney-in-fact is voidable in equity unless the attorney-in-fact can show that the principal voluntarily consented to the interested transaction after full disclosure. Because of the fiduciary relationship between Jay and his mother, Jay's duty of loyalty required that any self-dealing by him in his mother's assets be approved by his mother after she received impartial advice from a competent and disinterested third person, sufficient to enable Pauline to make an informed judgment. Even if Pauline had been legally competent to ratify such a decision — which she was not — that duty of loyalty requirement clearly was not met here.

The power of courts of equity to relieve against fraud or mistake extends to cases where one person wrongfully procures a deed transferring property rightfully belonging to another. In such cases equity will regard the wrongdoer-grantee as a constructive trustee for the benefit of the true owner, and will compel the wrongdoer to convey legal title to the rightful owner.

Because Jay violated the duty of loyalty that flowed from his status as Pauline's attorney-in-fact, all self-dealing transactions in which he engaged in that capacity, including the transfer of his mother's property by the quitclaim deed, are void. Accordingly, the plaintiff has also established entitlement to relief on this claim.

C. The Validity of The Centex Mortgage

The third, and final, claim to be resolved concerns the validity of the Centex Mortgage.

If the only interests involved in this lawsuit were those of Pauline and Jay, the analysis could end here. But the interests of a third party — Centexare implicated as well. Although Pauline's Estate will be restored as the rightful owner of the property that was her residence, the final issue becomes: whether or not the Estate will take that property subject to the Centex mortgage.

Centex claims that even if the quitclaim deed is found invalid, the Centex mortgage lien on the property transferred by that deed remains valid, because Centex was a bona fide mortgage lender for value without notice of any wrongful conduct that could otherwise operate to invalidate the deed. That bona fide mortgagee status, Centex argues, cuts off any conflicting equities in the property, i.e., requires that the Estate must take the property subject to Centex's mortgage. Centex relies on the general rule that:

A mortgagee is for some purposes regarded as a purchaser, and is entitled to the same protection given a purchaser for value where the mortgage is supported by valuable consideration, taken in good faith, without fraud, and without the mortgagee having actual or constructive notice of the outstanding rights of others in the property.

Centex claims it must be afforded the same protections normally afforded a bona fide purchaser or mortgagee against claims of third parties to property conveyed by a voidable deed. As support, Centex relies on Lea v. Griffin, where this Court stated that "even if there were evidence of fraud sufficient to permit a rescission between the grantor and grantee" the mortgagee would still be protected because the deed would have been merely voidable, and the interests of a bona fide mortgagee without notice would be unaffected. Similarly, Centex claims, any infirmities in the deed itself or in the process leading to its execution, such as Pauline's incompetence and Jay's wrongful conduct, would result in the deed being only voidable, rather than being void.

Centex's argument is fatally flawed for two reasons. First, for the reasons discussed above, the deed, in addition to being voidable, was also legally void ab initio. Second, Centex had constructive notice, at the time it granted the mortgage loan, that Jay's record title to the property that would serve as the collateral might be legally defective. That notice gave rise to a duty on Centex's part to inquire into the circumstances surrounding the execution of the deed. Centex failed to make further inquiry, and is chargeable with knowledge of what an inquiry would have revealed.

A mortgagee is put on inquiry notice where facts indicate that title to the collateral may be defective. For example, in Citizens First Nat'l Bank v. Bluh, a trustee applied for a mortgage, using property that he held in trust as collateral. The lender initially refused to extend the mortgage. Thereafter, the trustee deeded the property to himself as the sole owner, and the lender approved the mortgage loan. Based solely on that possible fiduciary irregularity, the court held that the lender was on inquiry notice that the deed to the collateral might be invalid, and that that self-dealing transaction imposed a duty on the mortgage lender to inquire further into the bona fides of the deed. The court concluded that "[w]hen one ignores a plain duty to make a full and complete inquiry, then he must accept the responsibility and liability his neglect or want of vigilance entails."

Here, the deficiencies and irregularities on the face of the quitclaim deed were enough to put Centex on notice that (i) the deed may have been legally insufficient to vest title in Jay Kenyon ( i.e., was void) and (ii) may have been wrongfully procured by Jay, as the grantee. Frank Capasso, the title searcher, informed GAC, Centex's agent, of the deficiencies in the deed and recommended that an attorney examine the deed before issuing title insurance. In addition, GAC had a copy of the deed and, therefore, was independently capable of evaluating the deed's facial deficiencies. Each person who searched the title, as well as a practicing Delaware attorney, testified that the quitclaim deed was defective on its face because it contained no legal description of the property. Moreover, the repetition of the grantor's name and supposed signature should have given Centex reason to question whether the deed was valid and should have caused Centex to investigate further. Finally, Centex, through its agents, knew that Jay had attempted to mortgage the property, and had even caused a title search to be made, at a time that he did not have record title to the property. That fact, coupled with the irregularities on the face of the deed and the information communicated by its title searcher, should have made Centex suspicious and prompted it to inquire into the facts surrounding the transfer of the property.

In these circumstances, Centex was not entitled to blind itself to evidence that to any reasonable observer would appear highly suspicious, and, without making any further inquiry, conclude that Jay Kenyon had valid title to the property that would serve as collateral for the mortgage. Because Centex was not a bona fide mortgagee without notice, Centex's claim to the property as mortgagee is subject to the superior claim of the property's rightful owner, Pauline Kenyon, who never validly consented either to the transfer of the property to Jay or to the imposition by Jay of a mortgage on her property in favor of Centex.

The Centex mortgage is invalid and will be set aside.

IV. CONCLUSION

For the foregoing reasons, judgment will be entered in the plaintiff's favor granting relief on all of the plaintiff's claims. Counsel shall confer upon, and submit to the Court, an appropriate Form of Judgment and Order.