Sale & Recording

Question 1

Types of Notice

Answer 1

1. Actual Notice - Notice served to parties
2. Constructive Notice - Through a recording system (must be proper) *Wild deed - recorded outside of chain of title (not proper)
3. Inquiry Notice - knowledge inferred from circumstances suggesting prior conveyance

Question 2

Types of recording Statutes

Answer 2

1. Race - First person to record prevails
2. Notice - Subsequent purchaser for value w/o notice (BFP) prevails, regardless of who records first
3. Race-Notice - Subsequent purchaser for value w/o notice (BFP) who records first prevails.

Question 3

Adverse Possession characteristics

Answer 3

1. Open & Notorious (behaves as owner)
2. Hostile (against rights of owner)
3. Continuous (if interrupted, must be consistent w/nature of property - summer property)

Question 4

Risk of Loss doctrines

Answer 4

1. Equitable Conversion - Risk passes to buyer when K is formed (Majority). In Minority, seller keeps the risk unless buyer has possession.
2. Uniform Vendor and Purchaser Risk Act - Risk passes to buyer when possession of title pass

* Doctrines only apply when parties haven’t agreed to the contrary

Question 5

Merger doctrine

Answer 5

If guarantee is made in sale K and not reflected in DEED, it is extinguished when deed conveyed to buyer

Question 6

Right of redemption

Answer 6

• after foreclosure
• statute gives time to prior mortgagor
• to pay money to
• redeem property
• * Only by statute and after foreclosure

Question 7

When is a Title Unmarketable?

Answer 7

When any part of the land is subject to:

• Adverse possession
• Encumbrances (servitudes, including lack of access, or mortgages) - waivable by buyer
• Zoning Violations

Reasonable person would not buy

Question 8

Implied promises of Seller in land K

Answer 8

1. Marketable Title at CLOSING
2. No false statements of Material Fact (gral. disclaimers will not relieve seller for fraud- “as is”)
3. No failure to disclose latent material defects (if known)

Question 9

Formalities of Land K

Answer 9

• writing (except part performance -
• possession, partial or total payment, and/or substantial improvements of the land) -
• Description of land -
• Identify parties -
• Specify price (or other consideration) -
• Signed by party to be bound

Question 10

Does the land K contain Implied Warranties of Fitness & Habitability?

Answer 10

NO (UNLESS -In the sale of a new home by a constructor)

Question 11

What is equitable conversion?

Answer 11

Doctrine under which purchaser of real property becomes an owner of title when signing the K

Question 12

Who inherits land after death of buyer in an equitable conversion?

Answer 12

Buyers heirs.
Seller heirs only own personal property interest (money owed by buyer)

Question 13

Requirements of closing

Answer 13

1. Lawful execution of deed
2. Delivery of deed
3. Acceptance of grantee

Question 14

What are the requirements to execute a deed?

Answer 14

• Writing (denoting intent to convey)
• Identity of parties
• Describe property
• Signed by grantor

Question 15

Types of Delivery of Deed

Answer 15

1. Actual delivery - Grantor physically or manually delivers the deed
2. Implied delivery - Present intent of the grantor to deliver deed (words or actions)
3. Presumption of delivery - grantor relinquish absolute and unconditional control over property (handed to grantee, acknowledged before Notary, Recorded)

Question 16

Types of defective deeds

Answer 16

1. Void Deeds - set aside even if property has passed to bona fide purchaser (BFP)
2. Voidable - set aside ONLY if property HAS NOT passed to BFP

Question 17

When a deed is Void?

Answer 17

• Forged
• Deed never Delivered
• Fraud in Factum

Question 18

When a Deed is Voidable?

Answer 18

• Lack of Capacity
• Infancy
• Duress
• Breach of Fiduciary Duty
• Undue Influence
• Mistake
• Fraud in Inducement

Question 19

Requirements for fraudulent conveyance

Answer 19

• Actual Intent to hinder, delay or defraud creditor or grantor (or)
• Not receiving reasonably equivalent value in exchange

Question 20

Types of Deeds

Answer 20

1. Quit-claim Deed - No covenants
2. General Warranty Deed - 3 present and 3 future covenants
3. Special Warranty Deed - 2 promises by grantor

Question 21

Exception for the Quit Claim Deed

Answer 21

Marketable Title at Closing (stems from the land K, not the deed)

Question 22

Present covenants of General Warranty Deed

Answer 22

Breached at Time of Delivery

• Covenant of Seisin - Grantor warrants he’s the owner
• Covenant of Right to Convey - Grantor warrants he has power to convey property
• Covenant against Encumbrances - Grantor warrants there are no encumbrances on property (mortgages, liens, easements, covenants, etc.)

Question 23

Future Covenants of General Warranty

Answer 23

Breached if Grantee Disturbed while possessing

• Covenant of Quiet Enjoyment - No disturb of Grantee’s possession by 3rd parties assertion of superior title
• Covenant of Warranty - Grantor will defend and compensate for lawful claims by assertion of superior title
• Covenant of Further Assistance - Execute any document to perfect title

Question 24

What promises contain the Special Warranty Deed?

Answer 24

• Grantor has not conveyed to another
• Free from encumbrances created by Grantor

Only applies to the Grantor (not predecessors in interest)

Question 25

Estoppel by Deed

Answer 25

If a party that sells a property w/o proper power later acquires ownership of property, MUST CONVEY property to buyer.

Question 26

What is the Shelter Rule

Answer 26

Anyone that takes of a BFP will prevail against any interest over which the BFP would have prevailed, even if grantee had knowledge of prior unrecorded interest, or it's a donee, heir, or devisee.

Question 27

_What is needed to transfer real estate?_

Answer 27

* Delivery of the deed * Not necessary recording * Once deed delivered, grantor can’t revoke

Question 28

_What is an Accession?_

Answer 28

Annex chattel into another’s property that can be removed w/o damage to the property

Question 29

_What is a Trade Fixture?_

Answer 29

* Fixture installed by a tenant in a trade or business * Can be removed, unless damage to the property * If damage to the property, tenant must pay for damages/repairs

Question 30

_How can a signature be waived from a deed?_

Answer 30

* Acceptance and record of the deed * Waive signature of the grantee to enforce mortgage * It’s called dead poll (deed only signed by grantor)

Question 31

_Rezoning theories_

Answer 31

* Variance – Permits a waiver from zoning requirements (if owner would suffer great hardship) * Doctrine of amortization – means to terminate a non-conforming use (use existed @ time of rezoning)