Assume the property is in California.
Bank records liens against 2 lots out of a 5 lot subdivision.
Subdivision is realigned from 5 lots into 4 lots and all lot lines are re-drawn and recorded via a new subdivision parcel map, which was acknowledged and signed by the bank.
The bank never recorded new trust deeds using the new legal descriptions of the 2 lots.
Then 1 of the 4 lots owned by a different person that the bank does not have a lien on is foreclosed on based on the old legal description when there were 5 lots.
This results in the foreclosure buyer showing as title holder based on the old legal description, which if using the new legal description his interest would have a portion of the neighbors lot next to him (which the bank has a lien on the old legal description) and the neighbor a portion of his.
1. What effect does this scenario have on the bank's liens that are based on an old legal description? If they acknowledged the new subdivision parcel map / lot lines, but did nothing to protect their lien rights by recording a new trust deed with the new legal description, what would be the impact to them?
2. If the bank now wants to foreclose, can they only foreclose on the old legal description or can they foreclose on the new legal description?
3. What about the foreclosure buyer that thought he was buying a lot based on the old legal description and foreclosed on the old legal description (which is what the deed documented that was foreclosed on, as it also was never updated to show the new legal description)?
4. What other issues might exist for the bank? for the foreclosure buyer? and for the owner of the 2 lots, where there bank has recorded deeds based on the old legal descriptions?