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When is marketability measured?
Generally the date of closing. Date of last payment in a land installment contract * *If an MBE answer refers to marketability sometime after closing it usually wrong.
What is the remedy if the title is not marketable?
1) The buyer must notify the seller and give him reasonable time to cure the defects 2) If seller fails to cure, buyers remedies include rescission, damages, specific performance w/ abatement, and a quiet title suit.
Does a quitclaim deed affect the warranty to provide marketable title?
No, it does not let the seller off the hook for defects.
What is the generally rule for time of performance of a land sale contract?
Courts presume time is \"not of the essence\" (i.e., closing date is not absolutely binding if tendered w/in a reasonable time)
When will the \"time is not of the essence\" presumption be overcome?
1) The contract so states, 2) The circumstances indicate that was the intent, or 3) One party gives the other notice that time is critical.
What is the liability if time is of the essence and a part fail to render performance on closing?
The party who fails to tender performance is in breach and may not enforce the contract.
What type of conditions are obligations under a land sale contract?
Concurrent, meaning neither party is in breach until the other tenders performance. * *If neither party tenders on closing date, the date is extended until one of them does
What are the remedies for breach of a sale contract?
Damages or specific performance. * *Damages are the difference between K price and market value on date of breach.
What is the sellers liability for defective property?
Seller may be liable for existing building defects on grounds of misrepresentation, active concealment, or failure to disclose. * *No implied warranty of quality or fitness for purpose
Are disclaimers of liability effective?
General disclaimers in the sales contract are not sufficient to overcome a seller\'s liability for fraud, concealment, or failure to disclose.
When are real estate agents entitled to commission?
The modern trend is to award commission only if the sale actually occurs or fails because of the fault of the seller.
What is the deed?
Deeds transfer the title to an interest in real property.
What requirements must be meet for the deed to be effective?
1) Be in writing, 2) Signed by the grantor, and 3) Reasonably indentifies the parties and the land.
When will a void or voidable deed be set aside?
1) Void deed will be set aside even if the property has passed to bona fide purchaser 3) Voidable deeds will be set aside by the court only if the property has not passed to a bona fide purchaser. * *Void deeds include those that are forged, obtained by fraud, etc. Voidable deeds are those by minors, incapacitated, duress, etc.
What would happen if a joint owner attempted to convey property by forging the signature of the owner?
1) The conveyance would be valid as to the interest of owner with valid signature 2) Void as to the other owner.
When may a deed be set as a fraudulent conveyance?
It may be set aside by the grantor\'s creditors if it was made: 1) With the actual intent to hinder, delay, or defraud; or 2) Without receiving reasonably equivalent consideration and debtor was insolvent.
What constitutes a sufficient land description for a deed?
It must provide a good lead to the identity of the property.
What is the order of priority where descriptions are inconsistent?
1) Natural monuments, 2) Artificial monuments 3) Courses (i.e., routes) 4) Distances 5) Name 6)) Quantity
When is a deed effective?
Only after it has been delivered and accepted.
What is delivery of a deed?
Grantor\'s intent to make a deed presently effective even if possession is postponed. * *eg, manual delivery, notarized acknowledgement, recording, etc
What is the effect of retention of interest by grantor or conditional delivery?
It indicates lack of intent, and the title will not pass even if the deed is executed because there\'s no delivery. * *A properly executed and delivered deed that provides title will not pass until grantor\'s death is valid and creates a future interest.
What is the effect of giving the deed to a 3rd party for delivery?
See notes
What is acceptance of the deed?
Completes a conveyance and usually is presumed after delivery.
What is dedication?
Transfer of land to a public body by written/oral statement, map showing land, or opening the land for public use.
How may a dedication be accepted?
1) formal resolution 2) approval of plot or map 3) actual assumption of maintenance or improvements
What are the 3 types of deeds?
1) general warranty deed 2) special warranty deed 3) quitclaim deed * *Real covenants are different in that they do not relate to title.
What are covenants for title?
Covenants that relate to title and are usually found in deeds. * *Real covenants are different in that they do not relate to title.
What are the usual covenants in general warranty deeds?
1) Covenant of Seisin (title and possession) 2) Covenant of Right to Convey 3) Covenant against encumbrances 4) Covenant for quiet enjoyment 5) Covenant of warranty 6)) Covenant for further assurances
Who may the last grantee sue if he is evicted by lawful claim of title?
Anyone up the line.
What a special warranty deed?
In many states, using the word \"grant\" in a deed creates assurances that: 1) the grantor has not conveyed the same estate or interest to anyone else, and 2) that the estate is free from encumbrances made by the grantor.
What is a quiet claim deed?
A quitclaim deed releases whatever interest the grantor has and no covenants of title are included or implied.
What is estoppel by deed?
If the grantor purports to convey an estate in property that he does not then own, his subsequent acquisition of the estate will inure to the benefit of the grantee. * *Not applicable to quitclaim deeds
How does estoppel by deed affect subsequent purchasers?
If the grantor transfers his after-acquired title to a bona fide purchaser for value, the BFP will prevail over grantee.
What is the original grantee\'s remedy in estoppel by deed?
Can accept title or sue for damages for breach of covenant.
What are recording acts?
Protects all bona fide purchasers from secret interests previously created and provide a mechanism for earlier grantees to give notice through recordation.
What do recording act statutes require?
That a grantee record his deed to put others on notice.
What can be recorded?
Any instrument creating or affecting an interest in land can be recorded, provided it is notarized.
Who has the burden of proving qualification for protection under a recording act?
The subsequent taker.
What protection is provided by a notice statute?
A subsequent BFP prevails over a prior grantee who fail to record. * *key is no actual or constructive notice.
What protection is provided by a race-notice statute?
A subsequent BFP is protected only if he takes without notice and records before the prior grantee.
What protection is provided by a race statute?
Whoever records first wins and notice is irrelevant. * *only 2 states use race statutes.
Who is protected by recording acts?
Only bona fide purchasers are protected under notice and race-notice statutes.
What are the requirements to be a BFP?
Must be: 1) A purchaser, 2) Without actual or notice, and 3) Pays valuable consideration
When is a purchase \"for value\"?
( 1) Okay if less than FMV, but still requires \"substantial pecuniary consideration\"( 2) Donees, heirs and devisees do NOT qualify as BFPs (NOT protected)
When is a person said to be on constructive notice?
1) Buyer has a duty to inspect premises before transfer of title and is responsible for what an examination of the land would reveal 2) If a recorded instrument makes reference to an unrecorded transaction—Buyer is on inquiry notice of whatever a reasonable follow up would have revealed
What is record notice?
A buyer is on notice of properly recorded deeds with in the chain of title. * *Chain is generally established by through a title search of grantor-grantee index
What is \"wild deed\"?
Arises when the transferee in chain of title fails to record. * *Incapable of giving record notice of its existence and is a nullity
What is the effect of a late recording?
A deed recorded after the grantor has passed title through a subsequent instrument is not constructive notice in most states.
What is the effect of a recorded deed received from a grantor who had no title when conveyed but later obtains title?
1) Most court say it does not impart constructive notice to subsequent purchasers 2) Some protect the grantee over BFP on an estoppel by deed theory.
What is an effect of a mistake by the recorder?
It is considered recorded when filed with the office, regardless of whether properly indexed. * *BFP may have cause of action against the recorder\'s office.
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