Purchase & Sale of Real Estate

Question 1

Conveyance of real estate

Answer 1

1) land K, which conveys equitable title

2) closing where the deed passes legal title and becomes our operative document

Question 2

Statute of Frauds

Answer 2

Contract must be:

1) in writing
2) be signed by party against whom enforcement is sought
3) must describe the land,
4) must be supported by some consideration

Question 3

What if the Size of the Land recited in Contract is More than its Actual Size

Answer 3

Specific performance with a pro rata reduction in price, commensurate with 2 accerage deficiency

Question 4

Exception to SoF - The Doctrine of Part Performance

- if any 2 of 3 will suffice to take out the K of SoF= meaning outside of writing requirement!

Answer 4

If you have 2 of 3 the doctrine is satisfied and equity will decree specific performance of an oral contract for sale of land: B takes possession, or B takes all/significant part of price, or B makes substantial improvement

Question 5

The Problem of Risk of Loss - Apply the doctrine of equitable conversion

Answer 5

once K is signed, even if closing hasnt taken place, Buyer owns subject to condition that buyer remitt balance owed at closing

Question 6

If interim b/w K & closing, there is destruction throughno fault of either party, who bears risk of fault?

Answer 6

Buyer, unless the K says otherwise.

Question 7

Two Implied Promises in every land K:

Answer 7

1) Seller will Provide Marketable Title at Closing (endures only up to closing)
2) Seller will not make any false statements of material fact

Question 8

Marketable Title

Answer 8

Free from lawsuit, litigation, and threat to free from reasonable X

Question 9

Three instances that render title UNMARKETABLE

Answer 9

1) Adverse Possession -
2) Encumberances
3) Zoning Violations

Question 10

render title UNMARKETABLE - Adverse Possession

Answer 10

Even if a PORTION of the title rests on AP, it is unmarketable. Therefore, seller must be able to provide good record title

Question 11

render title UNMARKETABLE - Encumberances

Answer 11

Marketable title means an unencumbered fee simple - Presence of any servitude (easement/restrictions) & mortage (outstanding) will render it unmarketable UNLESS B has waived them.
Note: Seller has a right to satisfy outstanding mortgage/lien at closing w/proceeds of sale.

Question 12

render title UNMARKETABLE - Zoning Violations

Answer 12

When Blackacre VIOLATES a Zoning ordinance - mere presence of zoning restriction insufficient. Only ACTUAL VIOLATION

Question 13

Seller will not make any false statements of material fact

Answer 13

Majority of states also now hold seller liable for Failure to disclose latent material defects - material lies & omissions fraud for which she affirmatively represents and conveniently omitts

Question 14

No Implied Warranties of Fitness or Habitability

Answer 14

The land K contains to implied warranties of fitness/habitability. Common Law is caveat emptor, buyer be ware
Exception: This applies to sale of a new home by a BUILDER-VENDOR : held to a higher standard

Question 15

The Closing

Answer 15

Controlling document is the deed (deed passes legal title)

Question 16

To pass Legal Title from seller to buyer the deed must be LEAD

Answer 16

Lawfully Executed And Delivered

Question 17

lawful Execution of Deed

Answer 17

has to be in writing, signed by grantor. it need not recite consideration nor must consideration pass to make it valid
- description doesnt have to be perfect but must be unambiguous and provide a good LEAD

Question 18

Delivery Requirement of LEAD

Answer 18

satisfied with grantor physically or manually transfers deed to grantor (can use messenger)
*NOTE: doesnt necessarily require actual physical trasnfer of deed instrument itself

Question 19

Standard for Delivery

Answer 19

Legal standard - a test solely of present intent – did grantor have present intent to be bound immediately, regardless of whether instrument was delivered physically

Question 20

Effect of Rejection of Deed

Answer 20

Rejection defeats delivery

Question 21

If a deed, absolute on its face is transferred to grantee w/ORAL CONDITION

Answer 21

Oral condition drops out, not provable and delivery s done

Question 22

Delivery by escrow

Answer 22

permissble for grantor to use escrow agent - he doesnt physically have to be there. once conditions are met, title must pass from escrow to grantor

Question 23

Covenants for Title and the 3 Types of Deed

Answer 23

1) Quitclaim
2) General Warranty Deed
3) Statutory Special Warranty Deed

Question 24

Quitclaim Deed

Answer 24

no promises; grantor doesnt even promise that he has ttitle to convey. Worst deed a buyer could hope for.

Question 25

General Warranty Deed

Answer 25

Best Deed a buyer could hope for (warrants against all defects in the title, including those due to grantor's predecessor) has present and future covenants

Question 26

Present Covenants - a present covenant is breached, at the time the deed is delivered

Answer 26

Seisin : grantor promises that she owns estate Right to Recovery: Has power to transfer (no temporarny restraints on alienations, rescrution to transfer) Encumberances: No servidtude/ liens on blackacre

Question 27

Future Covenants

Answer 27

Quiet enjoyment: not disturbed in possession by 3rd party's lawful claim of title Warranty: grantor will defend grantee against any superior title claims that arises (even if someone else asserts claim, ive got ur back) Futher Assurances: promises to do whats needed in future to perfect the title if it turns out to be imperfect

Question 28

Statutory Special Warranty Deed

Answer 28

This deed contains two promises that the grantor makes only on behalf of himself - no reps on behalf of his predecessors in interest: 1) Grantor promises she hasnt conveyed Blackacre to anyone other than grantee 2) estate is free from encumberances made by grantor