Conveyancing

Question 1

Where a buyer takes possession of land and makes a partial payment pursuant to an oral contract for the transfer of that land and with unequivocal reference to the buyer-seller relationship, these acts of part performance suffice to remove the contract from the statute of frauds.

Answer 1

The rule in Shaughnessy v. Eidsmo

Question 2

Courts of equity sometimes enforce an oral contract for the sale of land where there is ____.

Answer 2

Courts of equity sometimes ____ where there is adequate part performance.

Question 3

Under the statute of frauds, contracts for the sale of land …

Answer 3

… must be in writing to be enforceable.

Question 4

Definition of “right in personam”

Answer 4

A right against a specific person.

Question 5

Different states require different combinations of the acts of ____, ____, and ____ to satisfy the doctrine of part performance

Answer 5

a) payment,
b) possession,
c) improvements

Question 6

Where enforcement of forfeiture provisions of a land sale contract would result in injustice, a court of equity may deny forfeiture and order foreclosure proceedings instead.

Answer 6

The rule in Skendzel v. Marshall

Question 7

Absent a waiver, forfeiture provisions in land sale contracts are always enforceable (T/F)

Answer 7

False: Absent a waiver, ____ in land sale contracts are always enforceable.

Question 8

Definition of “equity of redemption”

Answer 8

A defaulting mortgagor’s right to pay his debt and recover his property.

Question 9

Definition of “foreclosure by judicial sale”

Answer 9

Legal proceedings which extinguish a mortgagor’s equity of redemption by selling the property to satisfy the debt, and either giving the mortgagor any excess, or giving the mortgagee a judgment against the mortgagor for any deficiency.

Question 10

Definition of “mortgage”

Answer 10

A lien against property that secures a debt, usually for the purchase of the property.

Question 11

Definition of “strict foreclosure”

Answer 11

Proceeding which gives a defaulting mortgagor a period of time to pay the amount due on the property and, if he fails to pay within that time, vests title in the mortgagee and extinguishes the mortgagor’s equity of redemption.

Question 12

Forfeiture clauses ____.

Answer 12

_____ clauses generally make time of the essence and, in the event of default, allow the seller to terminate the contract, retake possession, and keep all the payments already made.

Question 13

There is a judicial trend toward treating land sale contracts as ____.

Answer 13

There is a judicial trend toward treating ____ as mortgages.

Question 14

Forfeiture is closely akin to _____.

Answer 14

_____ is closely akin to strict foreclosure.

Question 15

American jurisdictions, have, for the most part, rejected strict foreclosure in favor of ____.

Answer 15

American jurisdictions, have, for the most part, rejected ____ in favor of foreclosure by judicial sale.

Question 16

An executory contract for the sale of land always includes an implied covenant by the seller to give marketable title, unless the contract expressly makes or excludes this covenant.

Answer 16

The rule in Wallach v. Riverside Bank

Question 17

Definition of “dower”

Answer 17

A wife’s interest in her husband’s land which she acquires upon his death.

Question 18

Definition of “inchoate right”

Answer 18

A right that is not yet perfected, contingent upon the occurrence of some event.

Question 19

Definition of “encumbrance”/”incumbrance”

Answer 19

An interest in or claim attached to land, such as an easement, mortgage, or lease, which cannot prevent conveyance of the land, but does diminish its value.

Question 20

Definition of “marketable title”

Answer 20

A title that is free from litigation, defects and serious doubts about its validity, which a reasonably prudent buyer would be willing to accept.

Question 21

Definition of “quitclaim deed”

Answer 21

A deed which conveys whatever title the grantor has, but which includes no warranties or covenants that his title is valid or free from defects or encumbrances.

Question 22

Lack of ____ does not render the owner’s title unmarketable

Answer 22

Lack of access to a tract of land does not render the owner’s title ____.

Question 23

There are 25 considerations for whether a title is marketable:

Answer 23

a) will construction,
b) deed construction,
c) necessary party omitted in a
proceeding,
d) break in chain of record title,
e) mortgage,
f) dower,
g) lease,
h) taxes,
i) special assessments,
j) judgments,
k) claims against a decedent’s estate,
l) building restrictions,
m) easements,
n) encroachments,
o) title based on judicial or tax sale,
p) defectively executed instruments,
q) variation in names,
r) defect in description of realty,
s) lack of possession by vendor,
t) competency of the grantor,
u) lost deed,
v) outstanding contract of purchase,
w) title tainted with fraud,
x) no patent or land grant from government, and
y) suits pending against the vendor.

Question 24

The title does not actually have to be defective to be unmarketable, but only ____.

Answer 24

The title does not actually have to be ____ to be unmarketable, but only subject to attack.

Question 25

If the contract is silent on the subject, the law _____, regardless of the type of deed he uses to do so.

Answer 25

If the contract is ____, the law implies a covenant by the seller to convey marketable title, regardless of the deed he uses to do so.

Question 26

While a contract for the sale of land is still executory, the risk of loss normally falls on the buyer, who is the equitable owner of the property, unless the contract provides otherwise.

Answer 26

The rule in Bleckley v. Langston

Question 27

Definition of “bond for title”

Answer 27

An agreement used in an installment contract for the sale of land, by which the seller agrees to convey title when the buyer has paid off the purchase-money notes he has given to the seller.

Question 28

While a contract is still executory, the party who must bear a loss from damage to the property should be the party who was in possession when that damage occurred (T/F)

Answer 28

False: While a contract is still executory, the party who must bear a loss from damage to the property should be _____.

Question 29

The majority common law rule is that after the parties execute a contract for the sale of realty, the ____ bears the risk of loss.

Answer 29

The majority common law rule is that after ____, the buyer bears the risk of loss.

Question 30

Most jurisdictions apply the ____ and therefore consider the buyer the equitable owner of the property after the signing of the contract.

Answer 30

Most jurisdictions apply the equitable conversion doctrine and therefore consider the buyer the equitable owner of the property after _____.

Question 31

The seller of real estate under an executory contract for deed is not liable for torts occurring on the conveyed property unless …

Answer 31

… unless the seller fails to inform the buyer of known dangerous situations that the buyer could not discover or the seller actively conceals.

Question 32

Equitable conversion shifts ___ as well as burdens

Answer 32

Equitable conversion shifts benefits as well as ___.

Question 33

A deed that is wrongly delivered out of escrow is void. The grantee of such a deed has no title to pass to an innocent purchaser.

Answer 33

The rule in Clevenger v. Moore

Question 34

If a deed is wrongly delivered out of escrow, the grantee of the deed has title to pass to an innocent purchaser (T/F)

Answer 34

False: If a deed is wrongly delivered out of escrow, the grantee of the deed has ___ to pass to an innocent purchaser

Question 35

Definition of “escrow”

Answer 35

A deed or other document held by a third party who is subject to instructions concerning the document.

Question 36

If a deed has been placed in escrow and all of the conditions have been met but the deed has not yet been handed physically to the grantee, the grantee still has legal title to the land. (T/F)

Answer 36

True: If a deed has been placed in escrow and all of the conditions have been met but the deed has not yet been handed physically to the grantee …

Question 37

Title acquired by adverse possession does not have to be recorded; therefore, a bona fide purchaser takes title subject to any unrecorded title acquired by adverse possession.

Answer 37

The rule in Mugaas v. Smith

Question 38

Title claimed by _____ need not be recorded to have priority over a bona fide purchaser.

Answer 38

Title claimed by adverse possession need not be recorded to have priority over a _____.

Question 39

The general rule is that a bona fide purchaser may rely upon the record title and that ____ are void against subsequent good faith purchasers.

Answer 39

The general rule is that a bona fide purchaser may ____ and that unrecorded conveyances are ____.

Question 40

Definition of “adverse possession”

Answer 40

A means to acquire title to land through obvious occupancy of the land, while claiming ownership for the period of years set by the law of the state where the property exists.

Question 41

Adverse possession is an exception to the general rule that unrecorded conveyances are void against subsequent bona fide purchasers because…

Answer 41

…because adverse possession is acquired without any document to record.

Question 42

When land is subject to adverse possession, a prudent buyer has more to do than …

Answer 42

… just search the title record. The buyer should also visit the property, look for any signs of adverse possession (e.g., a fence or a structure), and ask the neighbors.

Question 43

A deed that is properly recorded but not indexed as required by statute has the same effect as an unrecorded deed.

Answer 43

The rule in Mortenson v. Lingo

Question 44

The three categories of recording acts:

Answer 44

1. Pure race
2. Race notice
3. Notice

Question 45

Explaining “pure race” acts of recording

Answer 45

Where the grantee who first places his deed on the proper records prevails over other conveyances from the common source of title. The first grantee for value to record is protected even though he took with notice of a prior unrecorded conveyance.

Question 46

Explaining “race notice” acts of recording

Answer 46

These require that the subsequent purchaser be without notice at the time the conveyance is made and the consideration paid. In addition, the subsequent buyer without notice must record first:

Question 47

Explaining “notice” acts of recording

Answer 47

Acts following this pattern protect the junior conveyee against a prior unrecorded conveyance if he has paid value and is without notice.

Question 48

In notice acts, the junior conveyee is protected even though the senior conveyee records …

Answer 48

… after the grant to the junior, and before the junior records––or even if the junior does not record at all.

Question 49

The antiquated “grace period” type of recording act …

Answer 49

…declared a deed invalid against a good faith purchaser unless recorded within a certain number of days (typically fifteen) of the closing

Question 50

Nearly all of the states now have either a ____ or a ____ statute and the two categories are about equally divided in popularity

Answer 50

____ now have either a notice or a race notice statute, and the two categories are ____.

Question 51

In a pure race jurisdiction, the instrument recorded first has priority.

Answer 51

The rule in Simmons v. Stum

Question 52

Definition of “promissory note”

Answer 52

A written promise by a person (called a maker, obligor, payor, or promisor) to pay a specific amount of money (“principal”) to another (called a payee, obligee, or promisee), usually to include a specified amount of interest on the unpaid principal amount.

Question 53

In a pure RACE jurisdiction …

Answer 53

… the holder of the first recorded instrument prevails, even if he or she is not a bona fide purchaser.

Question 54

In a RACE NOTICE jurisdiction …

Answer 54

… the holder of the second instrument prevails if he or she is a bona fide purchaser and records first.

Question 55

In a pure NOTICE jurisdiction…

Answer 55

… the holder of the second instrument prevails if he or she is a bona fide purchaser.

Question 56

There are three principal points of divergence from the English model of real estate transactions:
a)
b)
c)

Answer 56

(a) Some statutes follow the New
York style and make the oral
agreement void; others simply say
no action shall be brought;
(b) some statutes require that the
agreement be subscribed, others
only that it be signed;
(c) some statutes require that the
agreement be signed by the party
to be charged, others that it be
signed by the vendor, and at least
one state (Idaho) has held the
agreement unenforceable unless
signed by both parties.

Question 57

Explaining the “Torrens System”

Answer 57

A title registration system under which involuntary transfers such as foreclosures must go through the court system and are only valid upon issuance of a court decree.