Fin 350 Chapter 3

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deed

Back 1

special, written contract for conveying permanent interest in real property

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requirements of deed

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-Grantor (with signature) and grantee
-Recital of consideration
-Words of conveyance
-Covenants
-Habendum clause
-Exceptions and reservations clause
-Description of land
-Acknowledgment
-Delivery

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grantor

Back 3

person or entity conveying real property
-must be of legal age
-must be legally competent
-must sign deed

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grantee

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recipient of real property
-no need to be of legal age
-no need to be legally competent
-only needs to be identifiable

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Recital of consideration

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intended to prevent any challenge to a transfer of real property based on inadequate or nonexistent consideration

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words of conveyance

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-does hereby grant, bargain, sell and convey
-Affirms intention to convey real property/ rights
-determines type of deed

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covenants

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legally binding promises, which the grantor becomes liable; that is, if the promises prove to be false, the grantee can sue for damages

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3 main components of seizin:

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-covenant of seizin
-covenant against encumbrances
-covenant of quiet enjoyment

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covenant of seizin

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promise that grantor has good title and right to convey it

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covenant against encumbrances

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no encumbrances except as noted in deed

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covenants of quiet enjoyment

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-no one with a better claim to title
-right to the undisturbed use and enjoyment of real property

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habendum clause

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defines or limits the type of interest being conveyed.
-for use as=implies easement
-so long as=implies conditional fee with reverter
-and his/her heirs and assigns forever=implies fee simple absolute

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exceptions and reservations clause

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-deed restrictions
-clauses withholding mineral or oil rights
-creation of easement

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property descriptions

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-must be unambiguous and enduring
-unacceptable descriptions include street address and tax parcel number

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3 methods acceptable for public records on description of land

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-metes and bounds
-plat lot and block number
-government rectangular survey

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acknowledgment and delivery

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acknowledgment: confirmation that grantor acted voluntarily
delivery:observable, verifiable intent that deed is to be given to grantor
grantor must hand it to the grantee

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Types of deeds

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-General warranty deed
-Special warranty deed
-Deed of bargain and sale
-Quitclaim deed
deeds differ by its number of covenants

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General warranty deed

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All three covenants: seizin, no encumbrances, and quiet enjoyment
- it contains full set of legal promises the grantor can make
-highest quality deed

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special warranty deed:

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all 3 covenants but no encumbrances limited to grantor's ownership
-...that the property was not encumbered during his or her ownership.

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deed of bargain and sale

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no covenants, but still is regarded as implying ownership
-usually businesses to convey property

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quitclaim deed

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-no covenants and makes no assertions about grantor's interest
-Generally a quitclaim deed relieves the grantor of liability regarding the ownership of the property.

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Voluntary conveyance by a deed

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-Ordinary sale and transfer of title'

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involuntary conveyance by deed

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-probate
-Bankruptcy
-Divorce settlement
-Condemnation
-Foreclosure

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probate

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at death of property owner, the property will convey in one of two modes: testate (in accordance with a will, property is said to be devised or conveyed by devise), or intestate(without a will, conveyed by law of descent).

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Condemnation

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by the power of eminent domain, gov't can take private property for public purpose through due process, and with just compensation. process of exercising this power is known as condemnation.

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voluntary conveyance without deed

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easement only: implied, easement by estoppel, easement by prior use or necessity

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involuntary conveyance without a deed

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Easement by prescription
Title by adverse possession
Requirements

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implied easement

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-not created by an explicit deed or an explicit clause in deed
-often created when a subdivision map is placed in public records

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easement of prior use or necessity

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arise when a landowner subdivides land, conveying part of it in a way that causes a parcel to be landlocked. if landlocked parcel has no prior path of access and egress, then an implied easement of necessity is automatically created.

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easement by estoppel

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occurs if a landowner gives an adjacent landowner permission to depend on her land.

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dedication

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when a developer creates an subdivision, it is common to dedicate the streets rights of way and perhaps open spaces such as parks, school sites, or retention ponds.

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involuntary conveyance without a deed

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-easement by prescription
-title by adverse possession
-requirements

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accretion

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water may deposit soil, which can become the property of the owner

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reliction

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subsiding water may leave additional land as property of the owner

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Doctrine of constructive notice

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-Cannot be bound by what you cannot know
-The Doctrine of constructive notice is a legal idea which means the person been notified, whether they know it or not.

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Statute of Frauds

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Contract must be written to be enforceable

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Recording statutes:

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A contract recorded in public records is considered known

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actual notice

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open, continuous, actual possession of property

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title

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collection of evidence indicating a particular person(S) as holder of the fee

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title search

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examining public records to construct "chain of title"

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chain of title

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-the sequence of conveyances passing ownership down through time
-set of deeds and other documents that traces the conveyance of the fee, and any other interest that could limit it-from the earliest recorded time for the particular property to the current owner

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title abstract

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each relevant document was summarized, and the document summaries were compiled into chronological volume

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evidence of title

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assurance of good or marketable title

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marketable title

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claim to title is regarded as free from reasonable doubt

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2 main forms of evidence of title

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-Title abstract with attorney’s opinion: Summary of all records in chain of title reviewed by an attorney for completeness
-Title insurance commitment: Indemnifies grantee if challenge to title arises

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Metes and bounds

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A sequence of directed distances:
-Compass directed “walk around property”
-Establishing point of beginning is critical
Oldest form of acceptable land description
Most flexible form
Most difficult to interpret
Should be made or interpreted only by surveyors