Land Sale K

Question 1

Conveyance two step process

Answer 1

1) Contracts (conveys equitable title) (lives only until step 2)
2) Closing (deed passes legal title)

Question 2

What is escrow?

Answer 2

Space between step 1 and 2 of conveyance. allows buyer to do requisite inspections, change to get a mortgage, chance to check integrity of title, etc.

Question 3

Writing requirement

Answer 3

SOF. Must be in writing to be enforceable.

Identify parties; describe property; state consideration. Signed by D.

Question 4

Remedy if land sale K overestimates land description (acerage)

Answer 4

Specific performance with a pro rata reduction in price

Question 5

Exception to SOF for land sale

Answer 5

Buyer can enforce oral K by specific performance if:
1) K is certain and clear AND
2) Acts prove existence of K

Acts usually satisfied by 2/3 of the property:
1) Possession
2) Purchase (or significant portion)
3) Substantial improvements

Question 6

Equitable title vs legal title

AND
Equitale conversion (risk of loss)

Answer 6

Legal title: Deed (right to possess)
Equitable title: Contract (risk of loss)
—–buyer bears risk unless K says otherwise

So if Blackacre is destroyed after signing through no fault of either property, sorry buyer!

Question 7

Two implied promises in every land sale K

Answer 7

1) Seller will provide marketable title
2) Seller will not make false statements of material fact

Question 8

Marketable title

Answer 8

Seller’s implied promise to provide title REASONABLY FREE from DOUBT/THREAT of litigation on closing

Question 9

Most common defects of marketable title

Answer 9

1) Defects in the record chain of title
2) Encumberances
3) Zoning violations

Question 10

Defects in the record chain of title (marketable)

Answer 10

Title must be good record title.

IF even part of title rests on AP, its unmarketable b/c it DOESN”T APPEAR IN THE RECORD. But okay if pervious suit to quiet title established it.

Question 11

Encumberances (marketable)

Answer 11

Any outsanding mortgages, liens, servitudes, will render unmarketable UNLESS BUYER HAS WAIVED THEM

Question 12

Zoning VIolations (unmarketable)

Answer 12

Zoning restrictions do not affet marketablility.

BUT EXISTING VIOLATIONS DO.

Question 13

Promise to not make false statements of material fact

Answer 13

1) “” “”
AND
2) Failure to disclose LATENT MATERIAL DEFECTS
——what she lies about and what she omits

Question 14

Disclaimers of liability

Answer 14

General disclaimers (“as is”) are no good.

BUT disclaimers that identify specific types of defects (“the roof” will likely be upheld

Question 15

Implied warranty of fitness or habitability

Answer 15

NONE. Buyer beware is the norm. Buyer should be checking this during escrow.

EXCEPTION: New home sold by builder.

Question 16

If the buyer of land determiens that seller’s title is unmarketable, the buyer…

Answer 16

Must notify the seller and give a reasonable tiem to cure defects

Closing date may be extended to allow for this.

Question 17

Seller’s right to clear encumberances with proceeds

Answer 17

If encumberance is on title, seller is entitled to clear it with the proceeds of the sale.

Question 18

Beneficial Easements

Answer 18

Exception to marketable title rule IF:
1) Beneficial easement
2) That was visible or known to the buyer