*Voluntary Transfers (Ch. 5) -Uniqueness of Real Estate Transaction

Question 1

Statute of Frauds

Answer 1

• Transfers in land are invalid unless memorialized in writing
o Some exceptions – doctrine of part performance; inheritance

Question 2

• Timberlake v. Heflin – WV (1989)

Answer 2

o F: Divorce, husband to get home, wife to get property; W should have executed deed transferring her interest in home, but doesn’t; tries to stay in home so H brings suit
o H: For P – wife’s memo pleading was sufficient for statute of fruads
 Don’t necessarily need document signed by grantee
 Most jurisdictions are very liberal – writing just has to support existence of a K

Question 3

Right to Specific Performance

Answer 3

• Breach of real estate K – typical remedy is specific performance b/c of the uniqueness of real estate
• Traditionally, if either party breaches, the other could demand specific performance
• Now, seller remedy (buyer breach) is typically not specific performance
o Liq’d damages are common
o Most just seek damages and will purchase another home
• Buyer still has option of specific performance against breaching seller in all 50 states

Question 4

• Centex Home Corps v. Boag – NJ (1974)

Answer 4

o F: Condo case; D, buyer, cancels the contract; P, developer sues and seeks specific performance
o H: P gets deposit, not specific performance
 Seller’s damages usually measurable, unlike buyer’s
 Specific performance shouldn’t be automatic remedy for sellers, especially in this context where condo is not really “unique”
 Ct. looks to mutuality of obligation, not mutuality of remedy
• For very unique property, might make sense for specific performance even for buyer breach because finding a second buyer may take very long time, difficult to determine damages (Mona Lisa hypo)

Question 5

Equitable Conversion

Answer 5

• Executory period between contract for the property and closing date (typically 90 days)
o Delay due to: financing, title search, inspection/improvements to the home
• When K is signed, title is divided into legal and equitable components
o Buyer takes equitable title
o Seller holds legal title until closing – stays in possession
• Issue: what happens if the property is damaged between K date and the closing date?
o Traditionally, loss fell on the buyer (thus buyer needs title insurance)
o Minority – no equitable conversion; duty falls on seller