Pg 54 Flashcards
Unrecorded deeds are void against who?
BFPs
If you make a deed to a dead person, what happens?
It is invalid
What are different ways that you can fix unmarketable title?
- through adverse possession
– curative acts: these try to make prior conveyances that are more than 2 to 3 years old valid and recordable even if they have minor defects. Only some states have these
– special statutes that bar very old claims to land [30 to 50 years old] and cut off all interests that are old enough unless formal notice was recorded in more recent records
– marketable record title acts
What are marketable record title acts?
These void most types of claims to land if not in the records between the date of the root of title and a certain number of years later. it is unnecessary to search earlier than the root of title because nothing there could affect the present title. The purpose is to limit the title search.
How many states have marketable record title acts?
18
What is the root of title in relation to marketable record title acts?
This is the last transaction with no document recorded after it to show a conflict that is a certain number of years in the past.
If the statute says 30 years, and you do a search in 2000, and the deed was recorded in 1975, it is not the root, but 1965 is.
Under the marketable record title acts, if ancient rights to land are specifically referred to in a document that is recorded in the chain of title within the time period following the root, what happens?
Those rights are not affected by the marketable record title acts
How do you preserve pre-root interests under the marketable record title acts?
As long as the instrument was recorded within the statutory time after the root of title, you preserve those interests if if you make specific timely reference to the post root document in the chain of title, or timely re-recording of the pre-root document
What are exceptions to the marketable record title acts?
Interests of the US government because the state cannot divest federal government of land, the rights of parties that have possession, observable land easements and use restrictions, special interest statutes, mineral interests/water rights/utility easements/railroad easements.
Exceptions apply even if claims aren’t physically observable
How do you know if land has the six covenants of title in the deed?
It is either expressly stated in the deed, or words such as “Grant, or convey and warrant“ automatically imply these covenants.
What is the point of the six covenants of title in deeds?
For the seller to ensure that he has the estate in terms of quality and quantity. This is just an extra way to protect title
Must all six of the covenants of title be used or present on land?
No, the covenants can be used separately or in any combination together
How do covenants of title relate to marketable title?
Covenants of title are created in the deed, so they are not part of the contract, which means they are totally independent of marketable title
Is it possible to limit covenants of title?
Yes, they can be:
- expressly limited in their coverage
- there can be exceptions
- you can limit them by fixing a time period, etc. Ie: “Defects arising after 2001”
- they can be limited in scope by language like “assumed“
If the language “Grant, bargain, sell, convey“ is used in the deed, what has happened?
Covenants are in the deed even though none are specifically mentioned
What is a statutory warranty deed?
When the jurisdiction has a statute that says the deed is a warranty deed if it has certain language, such as if it says “warranty”
What is the doctrine of merger in relation to the covenants of title in deeds?
- AFTER a deal closes, you can only sue for covenants of the deed or warranties of title in the buyer’s deed, because the assumption is that the buyer accepted title as it was.
- but BEFORE the conveyance or acceptance of the deed, you can sue for marketable title (and that ability ends once the deal closes).
What does it mean for a covenant to “run with the land“?
The covenant passes to future grantees
Is notice a factor in enforcing covenants of title?
No, so if the seller didn’t have seisin when he sold the property to the buyer and the buyer had notice of it since someone else was possessing the land, that doesn’t change the breach of covenant. But if the buyer had knowledge of the other person’s interest, that may defeat the covenant.
The exception is for situations when the buyer reasonably believed the seller would eliminate that other interest before closing
What are the questions you need to ask in relation to covenants of title in deeds on an essay?
- is the deed general or special?
– does it include all covenants?
– Is it limited to the grantor’s ownership period?
What are the two types of covenants involved in the six covenants of title in deeds?
Present covenants and future covenants
What are involved in present covenants as a portion of the six covenants of title in deeds?
The breach happens when the deed is delivered and accepted and SOL starts running then (the claim could be barred before the grantee even knows title is defective).
Present covenants DO NOT RUN with the land and they are only enforcible by the immediate grantee (that’s the only person that can sue).
These relate to promises about the state of affairs at the moment of covenant. To get damages the plaintiff must show actual harm and eviction, otherwise he only gets nominal damages
What are the three present covenants of title?
– Seisin
– right to convey
– against encumbrances
What is involved in the present covenant of “seisin“?
A promise that the grantor possesses the land either legally or wrongfully. This is breached if the grantor doesn’t have all legal rights he purports to convey. This can happen by the seller not having title to the land at conveyance, or having a lesser estate than was described in the deed.
If you convey land to Barb and then also convey the same land to Connie with a covenant of seisin, what are you liable for under the covenants of title in deeds?
You are liable for the breach of seisin. If Connie knew about Barb’s rights, she couldn’t recover unless she reasonably thought you would eliminate them before closing. If Connie just had notice, that’s not enough.
What is involved in the present covenant of “right to convey“?
The covenant promises that the grantor has the power and authority to make the conveyance (aka: he has title and right of possession). The right to convey can be given to someone else through power of attorney to transfer the land, but you still own the land (then that person can sell the land with this covenant because they have that right).
This covenant is breached if the owner was a minor and sold the land with this covenant or there were restrictions on his right to convey the property.
What is involved in the present covenant of “against encumbrances“?
A promise that there are no outstanding rights or interests of third parties that affect title to the property at the time of delivery. This could include things like mortgages, liens, or easements.
If you conveyed land to Bob with a covenant against encumbrances, and Bob notices there is a path across the land, then learns that Esther has an easement of ingress and egress, does the fact that Bob had notice of the encumbrance make it so that he cannot recover under the present covenant of “against encumbrances“?
No, because he didn’t have KNOWLEDGE, so he can recover
If an encumbrance on land is not expressly excepted in the deed, but it is obvious to the grantee, what do the courts say about whether the present covenant of “against encumbrances“ applies?
There is a split:
– some courts say it doesn’t matter that the buyer had actual personal knowledge, only that the encumbrance was open and visible, and if it was, the encumbrance does not violate the covenant
– other courts say the person had to have had actual knowledge
Is it possible to include an exception in a deed if there is a lien or mortgage that the buyer is willing to take on, and still have a covenant against encumbrances?
Yes, that means that they agree to the lien, but to no other encumbrances
If an owner has a big home with a mortgage from the bank, and he sells to someone else and doesn’t mention the lien, what present covenant has been broken?
Covenant against encumbrances
What are future covenants as a subset of the six covenants of title in deeds?
These are breached when the grantee is actually disturbed by someone with paramount title/evicted and the SOL begins at the date of eviction.
THEY RUN WITH THE LAND. So they are breached after the conveyance and they are enforceable against the original grantor by remote grantees since they’re not violated until the breach happens when the grantee calls on the grantor to perform and he refuses to do so.
How does an eviction happen with regard to future covenants of title?
It happens when the person that is interfering has actual and superior title. It can also happen by the grantee voluntarily giving up possession, or an outstanding title being assertive in a judicial proceeding against the party in possession, or a final judgment or decree that is adverse to the covenant’s title or right to possession, etc
What does the buyer recover under future covenants?
The loss he suffered that was caused by the breach. He cannot get double recovery from multiple previous grantors. He can only get the full amount of it from either one previous grantor or by splitting it between them
