Where Do I Live?

Properties On, Near, or Straddling State Lines

   Effective January 1, 2017, some property owners along the North Carolina/South Carolina border moved from North Carolina to South Carolina, or vice versa, thanks to an Executive Order adopting an historic re-survey of the common boundary between the two states. This poses any number of legal issues for people selling land that runs along the boundary.

   Since as early as colonial times until the present, the exact location of the two states’ common boundary has been, or has become, uncertain in many locations. Over the past several years the States of North Carolina and South Carolina have been surveying or re-surveying their common boundary to locate and preserve historical monuments marking the boundary. On December 5, 2016, Governor McCrory of North Carolina signed an executive order (No. 118)adopting the re-survey of the boundary and triggering the implementation of earlier legislation (SB 575) addressing the anticipated problems the re-survey would inevitably cause.

   The re-survey left parcels that were previously believed to be entirely in South Carolina now entirely in North Carolina. There are also now parcels that are split by the state line. North Carolina’s legislation, therefore, addressed many issues such as tax liability, title, foreclosure process, school attendance, driver’s licenses, qualification for in-state college tuition, motor vehicle titles and taxes, utilities, fire protection, and others.

   The effect of this re-survey of the boundary on real estate closings involving affected parcels is profound.

   First, there is the issue of actually examining title to the real estate. If all or part of a parcel is now determined to be in North Carolina rather than South Carolina, it means that the deeds and other title records are recorded in South Carolina and not the county where the property is actually located. That will require a title search in South Carolina for a North Carolina property as well as a title search in North Carolina. All new recordings affecting the title will need to occur in North Carolina even though recordings such as mortgage satisfactions may still occur in South Carolina. Closings for these properties will take extra time and will require two attorneys to complete – one licensed in North Carolina and one licensed in South Carolina. As the title records settle in North Carolina, the process for parcels now entirely in North Carolina will become standard like any North Carolina property. It will also be an almost certainty that a new survey will be required for any affected parcel in order to tie the parcel to the location of the boundary line.

   Second, there are multiple legal issues to examine on any affected parcels because of differences in North Carolina and South Carolina law. Here are two examples:

In North Carolina, a non-owning spouse (i.e. a spouse whose name is not on the deed) has a marital right in the real estate of the owning spouse and must sign the deed for the property to convey. South Carolina does not recognize a marital right of a non-owning spouse. If a South Carolina deed is signed by a married owner, this raises the question of whether the conveyance was valid in North Carolina.

Another problem area concerns property that was inherited. In North Carolina, a deceased person’s will operates as the equivalent of a deed and transfers title. In South Carolina, there must be a deed from the deceased person’s estate to the heirs.

   These two examples just scratch the surface of the title issues that must be addressed in closings on affected parcels. The North Carolina legislation solves many of these problems by stating that, with respect to South Carolina documents, North Carolina will give “full faith and credit in this State according to the law, jurisdiction, and terms in effect at the time of the conveyance” in South Carolina.

   North Carolina has done a good job of identifying the parcels affected by the boundary line survey and is in the process of notifying landowners. In each county register of deeds with affected parcels, the State has recorded a Notice of Affected Parcels along with a copy of the survey map. These documents are indexed under the heading “Boundary” or “NC Geodetic Survey.” They should also be indexed under the names of the owners of all affected parcels. The tax listings for all affected parcels were also being changed during the 2017 tax listing period. Individual owners should have received direct correspondence about the status of their property and any other changes they need to make such as voter registration and driver’s licenses.

   The process of boundary surveys is continuing in North Carolina. The next project is the North Carolina-Virginia border, and Tennessee and Georgia are also queued up. Each state will have its own peculiarities because new legislation will be required for each re-survey, and the cooperation from each state will differ. For more information, visit the North Carolina Geodetic Survey.