Chapter 7: Acquisition of Real Property by Gift or Purchase Flashcards
Contract for the Sale of Land: Statute of Frauds
-Does the contract between Oscar and Abel for the sale of Whiteacre comport with the Statute of Frauds?
-The Statute of Frauds provides that a contract for the sale of land must be in writing, be signed by the party to be charged, and state all the material terms for the contract.
Party to be charged
-Is Oscar a party to the transaction to be charged when he forgets to sign the contract?
-The party to be charged is the party trying to avoid the contract.
Abel’s Signature
-Can Abel be deemed to have signed his name as the party to be charged when he does not actually sign his name but uses a stamp of his signature because he has a muscular disease that prevents him from signing?
-In determining whether the signature requirement of the SOF has been satisfied, courts typically do not address the problem from a literal perspective but focus on the intent of the parties.
Description of the Property
-Assuming that Abel did “sign” the contract, was the property, described as “Oscar’s single-family house,” sufficiently described to comport with the SOF?
-The SOF typically requires a legal description as found in the property tax rolls, although a street address also will typically satisfy the statue. A so-called Mother Hubbard clause (“all the property I own in X country”) also satisfies the statute.
Marketable Title
-Can Abel avoid the contract because at the time of closing, Baker’s action precluded Oscar from delivering marketable title?
-Marketable title is a title free from reasonable doubt. Title is free from reasonable doubt when the seller owns what he purports to sell, there are no encumbrances on the property, and the property is not in violation of any law.
Time is of the Essence
-When the contract stated, “the parties understand that closing escrow on March 2 is quite important,” did they create a time is of the essence contract so that when escrow did not close on March 2, could Abel secure rescission?
-A “time is of the essence contract” provides that each party must tender performance by the date specific and a failure to do so by one party discharges the other party. Whether a contract is a time is of the essence contract is dependent on the language of the contract and the intent of the parties.
Equitable Estoppel
-Is Abel equitably estopped from securing rescission when he delayed in informing Oscar of Baker’s lawsuit?
-Equitable estoppel precludes a party from raising an argument or defense that it otherwise would be allowed to raise but for its misleading conduct, if the innocent party would suffer consequential unconscionable injury. Misleading conduct can be actual fraud or “moral fraud.”
Risk of Loss
-Does Oscar bear the risk of loss when a lighting strike destroyed the building?
-In some jurisdictions, in the absence of a contrary provision in the contract for sale, when property is destroyed through the fault of no one, the risk is on the seller: the transaction does not go through. The buyer gets his deposit back and the seller gets his property (sans the building) back. In other jurisdictions, the risk of loss is on the buyer: the transaction goes through. The seller gets his money back and the buyer gets the property (sans the building). This latter allocation of risk is referred to as equitable conversion.
