Land Sale Contracts

Question 1

Land Sale Contracts

Land Sale Contracts Requirements

Answer 1

1) writing
2) description of property
3) parties ID
4) purchase price
5) signature of party to be charged

writitng exception: past performance or taking possession means no SOFs

Question 2

Land Sale Contracts

Equitable Conversion

Answer 2

splits ownership between the buyer and seller on day land contract is signed
-buyer: equitable title
-seller: legal title (holds property in trust for buyer)

Question 3

Land Sale Contracts

When does the seller have to actually provide legal title?

Answer 3

-Generally, a seller is required to provide marketable title ont eh closing date.
-Where the land sale K does nto indicate that ‘time is of the essence’ the sellers performance need only occur within a reasonable time after the scheduled closing date

Question 4

LAND Sale Contract

Who bears the risk of loss?

Answer 4

Majority: transfers to buyer when land sale contract signed (majority)
Minority: seller bears risk UNLESS buyer has possession or title to property at time of loss

Question 5

Land Sale contracts

Warranty of Marketable Title

Answer 5

title must be free from any cloud and not subject to adverse claim (free from encumberances or liens)

Question 6

Land Sale Contracts

When is title unmarketable

Answer 6

title in unmarketable if it has a substantial defect, such as:
1) defect in record chainof title, and/or
2) encumberances (mortgages, liens, restrictive covenants, esaements, a claim of adverse possession, or zoning violations)

zoning restrictions do not make title unmarketable

Question 7

Land Sale Contracts

What happens if a seller cannot convey marketable title at closing

Answer 7

buyer may withdraw without penalty
-buyer may waive defect. if buyer waives, seller cannot cancel.

Question 8

Land Sale Contracts

Damages for breach of warranty of marketable title

Answer 8

measured by reduced value of land
(its divided on whether damages are recoverable if the encumberance is known or obvious -when actual, constructive, or inquiry notice exists))

Question 9

Land Saler Contracts

Time is of the Essence

Answer 9

generally, time is not of the essence, unless the parties make it so.
(Closing may be changed if requested by one of the parties, unless time is of the essence)

Question 10

Land Sale Contracts

Merger

Answer 10

Once deed is delivered, and accepted, land sale K merges with teh deed
(rts to sue under K are estinguished, buyer may only sue on deed)
-some courts will not apply if it does not carry out the probable intent of parites ex-mutual mistake, scriveners error)

Question 11

Land Sale Contracts

Home Builders Implied Warranty

Answer 11

1) protects buyers of newly built homes against latent defects AND
2) warrants home is sake and fit for human habitation at time of sale

Question 12

Land Sale Contracts

latent defects

Answer 12

defect that could not have been discovered by a reasonable inspection

Question 13

Land SDale Contracts

Duty to Disclose

Answer 13

unknown, not visible physical defects must be disclosed to buyer