Very few logical permutations:

  1.  There is no title defect.

  2.  There is an affidavit defect that you have not spotted. 

  3.  The title defect that they think they know of is being misunderstood or misinterpreted by them as being such, when it really is not.

  Sounds like their first error is one of communication:  failing to do so openly and honestly. 

  The rest of the chaos that derives from that is not your fault, but it is on your desk to deal with.  My  sympathies.