By way of analogy, what do you think the effect would be of an unreleased lien from the Colonial period found within the title to your property? For example, suppose the Governor John Winthup of Massachusetts had neglected to get a full written release of a mortgage on a tract of land granted in Boston in 1645 which has since been sold and subdivided numerous time over the last four and a half centuries.
Can someone foreclosure on the unreleased lien from the 1600s even if of record and undischarged?
The simple answer is "of course not"!
First, there would be a particularly robust equitable defense of laches. Any plaintiff would also have a serious proof problem showing that it had succeeded to the valid right to enforce the unreleased lien.
There are probably several specific statutes that confirm an unchallenged title after passage of some time, etc. (i.e. adverse possession).
Sometimes, it is easier to understand an example by framing extremes. It is pretty easy to see that a cloud dating to the 1600s is probably no cloud at all. By contrast, the cloud arising from an unreleased lien in respect of an order of dismissal on the foreclosure suit is fairly opaque while the ink is still wet on the order. The cloud begins to dissipate after the ink dries.
It is probably also noteworthy that in most places the title improves not only through the passage of time, but also as a result of bona fide arms length transactions for value.
So, for example, if Smith has a clouded title and sells the property for cash to Jones, Jones also has a clouded title, though possibly slightly less clouded. Jones is on notice of the unreleased lien. Now suppose that Jones remains in quiet possession for three years and then sells to Robinson. Robinson gets a slightly better title. This is because there is usually no specific period of years as to the application of laches.
But each subsequent purchaser is relying upon not merely time but the undisturbed possession and failure of the lienholder to seek to enforce the lien.
(This is particularly so after the maturity date shown within the written instrument. That is, if the mortgage says that the balance was due in 1950, but no release was ever recorded, should I worry about the existence of this unreleased lien? Common sense suggests that if the lienholder hasn't sought enforcement sixty years after stated maturity, that no enforcement is going to be sought or ever take place. This tends to be true even absent some statutory provision vesting title after a certain number of years.(
The lienholder might somehow seek to enforce the lien against Smith some five or ten years later. Smith may successfully defend pleading res judicata (the prior dismissal), limitations and laches.
Subsequent purchasers may have a less robust res judicata defense, but have an ever growing laches defense. Would it be fair for the lienholder to sit on its hands through ten years and five purchasers and never seek to enforce its lien until Murphy has purchased the property from Robinson?
Usually, this is NOT a question as to when one has an absolute right of title in respect of the cloud. Rather, it is an incremental problem. The title gets better. At some point, the title is strong enough that either a title insurer will insure without exception and/or a lender will finance in respect of the noted title exception. It might be years. It might be decades. It might be a century. But the owner remains vested with incidents of ownership and enjoyment of the property unless the lienholder can make out a case to dispossess.