The Deed

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Formalities - Statute of Frauds

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 Executed Parol Gift – same as partial performance – if valuable improvement made get to keep it
 signed by grantor only – grantee is bound by covenants by accepting the deed – doesn’t need to sign it
• forged deed – no interest passes under a forged deed (if joint tenant forges other tenants name it is a severance and the deed is valid to that tenants interest)
• distinguish – deed procured by fraud – donee and bona fide purchaser cannot take anything from a forged deed – a deed by fraud is voidable against the grantor – if the grantor is not the one who put it into the chain of commerce she is protected –

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Formalities - ACknowledgement

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 acknowledgement – acknowledgment by grantor in front of notary and witnesses not necessary but desirable
• recordation – acknowledgement usually needed for recordation
• authentication – if acknowledged does not need testimony to be admitted as evidence – sometimes need proof of delivery and there might not be witnesses

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Formalities - Spouse's signature

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 signature of spouse – spouse must join because she has property rights that accrued from marriage

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Formalities - Words of Grant

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o words of grant – only one word necessary but many deeds have more than one (i give, grant, bargain, and sell, convey, quitclaim, assign)
 modern deeds – two types of deeds today 1) warranty deeds and 2) quitclaim deeds (does not warrant title)

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Formalities - Consideration

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o Consideration – not necessary to transfer land – land can be given away

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Parts of the Deed –

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 granting clause – sets forth parties, consideration, words of grant, and description of land,
 habendum clause – to have and to hold – can be used to negate a trust
• inconsistency – try to reconcile but used to be that granting clause took priority (can’t cut back what is already given)
• not used in statutory forms – omitted from all statutory forms
 grantor’s covenants – final paragraph may include covenants of warranty by the grantor

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DEscription of the grantee (part of granting clause)

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deed may be invalid if named grantee does not exist or is unascertained (failure to make a deliver)
 sufficient description required – need not be named but must identifiable (the wife of or oldest living child)
 grantee’s name left blank – if left blank it is a legal nullity – (intended grantee can only sue in equity for specific performance)
• implied authority – modern cases hold that if blank the agent of the grantor is implied with the authority to fill in his own or another name - nullity when executed but becomes operative when name is filled

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Description of land conveyed (part of granting clause)

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o admission of extrinsic evidence – the property can be described by metes and bounds (measurements and boundaries); reference to gov’t survey, recorded plot; a street number or name of property – extrinsic evidence is admissible to clear up ambiguity – any way to identify it is usually admissible
 part of larger tract – if ambiguous not effective, but can be suit in equity to clear it up
 no ambiguity – extrinsic evidence is not admissible to contradict a deed – only to show mutual mistake and carry out original intent

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Canons of construction (ised to validate descrption of land conveyed)

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o Canons of Construction – order – original survey monuments, natural monuments, artificial monuments, maps, courses, distances, name, quantity – when doubt they prevail in this order to figure out intent

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Street boundaries, waterway boundaries

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o streets and railways as boundaries – extends to center of right of way is presumption
o water boundaries – land under water given if it is owned by grantor

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Delivery

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- a deed is not effective until delivered – focus is intent – hand delivery usually shows this but is not necessary (if handed for safekeeping not enough without intent a.to make the deed operative and b. pass interest immediately

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Delievery - Presumptions

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o presumptions – delivery is presumed when 1) deed handed over 2) deed acknowledged before notary 3) deed is recorded – no delivery if deed held onto by grantor – only presumptions and can be rebutted by extrinsic evidence of contrary intent
 deeds effective at death – if intent is to transfer deed before death but hold onto for safe keeping it is valid – if intent to transfer after death not valid unless it meets the requirements of wills (telling a 3rd person delivery was made usually is enough)
 cancellation of delivery ineffective – once given cannot take back – statute of frauds requires writing to give it back

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conditional delivery to grantee

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o written condition – when there is a condition upon the deed taking effect two possibilities 1) no delivery and not effective until it happens or 2) legally effective now but interest is subject to condition precedent (the second one creates a springing executory interest)

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conditional delivery upon death of grantor

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• conditions relating to death of grantor – wording everything – if says retaining life estate than it is ok, if it says effective on death courts are split,
o surviving grantor – O conveys to A if A survives O – looks like will but not because a will isn’t revocable – looked at as a contingent executory interest and valid

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Delivery conditioned on oral condition

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oral conditions are void because of statute of frauds

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Covenants of title - definition, typesq

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• Covenants of Title – seller’s liability for defect in title is governed by covenants of title – covenants are not implied (real covenants do not relate to title)
o types of deeds – 3 types – general warranty, special warranty, quitclaim

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Types of warranty - definitions

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 general warranty – warrants for before and after the grantor had the land – contain all 6 covenants -
 special warranty – warrants for during the time the grantor had the land – contain all 6 covenants -
 quitlclaim deed – no warranty –
 statutory warranty – statutes in states of short form deeds where certain words include enumerated covenants

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Covenants included in warranty deed

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covenants of seisin – covenants that he owns the land or has interest he is conveying - present
covenant of right to convey – either owns title or is agent - present
covenant against encumbrances – no easements covenants, mortgages, liens or any other encumbrances – present
covenant of quiet enjoyment – will not be disturbed by a 3rd party’s lawful assertion of superior title – future
covenant of warranty – pretty much same as above – future
covenant of further assurances – will cover expenses need to make title perfect if it isn’t – future

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Merger of Contract into deed

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o Merger of contract into deed - can’t sue on contract once deed is transferred, has to sue on deed
 new trend – not favorable

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The Three Present Covenants

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o first 3 are breached when the deed is transferred (present)
 grantor is liable for defect even if it is known, if he doesn’t exclude it from the covenant
 some courts say if it is open and visible it was contemplated and ok
 public use and land use controls – private easements are breach of encumbrances – public land use controls (zoning and building codes not) – not breached by latent violation which the public authorities might not control – other violations are breach
 when breach occurs – breach occurs at conveyance so statute of limitations begins to run –
 whether the covenant runs – majority is that chose in action does not run with the land – example – A sells to B even though O owns the land – B sells to C – C cannot sue A, only B can

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The three future covenants

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o covenants of quiet enjoyment, warranty, and further assurances – future – not breached until event happens

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What constitues breach of future covenants

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 what constitutes breach – no cause of action if not disturbed (if someone has superior title future covenant is not breach if they don’t try to enforce it) – must actually be evicted or disturbed
• constructive eviction – don’t actually have to be evicted – being forced to buy superior title counts – if right of possession is interfered with paramount owner
• defending lawsuits – only has to defend against valid claims, does not have to defend against unlawful claims by a third party - burden on grantee – can collect from grantor if she loses – cannot recover legal fees if wins – if loses gets legal fees and damages - coventor only bound if has notice of the lawsuit (should have right to defend)

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When does breach of a future covenant occur; does the coveantn run with the land?

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lawsuit (should have right to defend)
 When Breach Occurs - grantee must wait until eviction to sue for breach after statute of limitations has run on present covenants
 whether covenant runs – covenant runs with the land if there is privity of estate
• no estate transferred – if someone does not have title and transfers title covenants cannot run because there is no ownership or possession – no estate
• criticism – the fact that it is a forest and unpossessed shouldn’t make a difference (estoppel gets around this)

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damages for breach of covenants - basic limitation

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• basic limitation – in most states the purchase price is the limit on reward (improvements and increase in value can wipe out a covenantor)
o gifts and exchanges – some courts say can get nothing, some courts say market value at time transferred is limit
o interests – interest on purchase price is sometimes granted but courts are split on whether it is at time of transfer or time of breach – (some say no interest because possession counts as interest)

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damages for breach of present covenant f seisin

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o covenant of seisin – if sue for seisin gets purchase price (limit) but must give up possession – can wait until evicted and than sue on general warranty, hoping – might acquire by adverse possession before being evicted
 partial breach – can recover damages proportionate to purchase price – if portion that was actually received is not livable can rescind and get full recovery of purchase price but must give up possession (1 case in gilberts where got to keep possession)

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damages for breach of present covenant against encumbrances

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damages are difference in value at the date of sale of land with and without encumbrance (same limit as above) – Duty on grantee to remove encumbrance - if can be removed by fixed amount (pay off mortgage) than that is the damages – if grantee does not actually remove damage only gets a nominal fee (we want grantee to pay off mortgage and than sue for damages)

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Damages for breach of future covenant

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• Future Covenants – damages are amount to buy up paramount claim if reasonable or can recover consideration paid for land – maximum is purchase price

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Estoppel by deed

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if someone transfers a deed without title, when they get it, it automatically transfers
 today applies to quitclaim deeds that purport to convey fee simple (wuitclaim would otherwise not promise ownership of the land)

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Warranties of Quaity

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common law no liability – caveat emptor almost all jurisdictions have a warranty of quality now – implied that building is free from defective materials and is constructed in a workmanlike manner (easier for builder to prevent defects)