Marketable Title

Minority Approach; Madhaven: What is Unmarketable Title?

1. Title that a reasonably prudent business person familiar with all relevant facts would refuse to accept 2. Does not have to be bad title to render it unmarketable 3. If you ask for insurable title and can't insure, then it is unmarketable.

Minority Approach; Voorheesville v. Tomkins: Where one enters into a K you have to take what you bargained for and cannot get?

Additional terms not originally bargained for.

Minority Approach; Madhaven: What is Encumbrance?

Anything which constitutes a burden on the estate, such as a right of way, easement or covenant, may constitute a forfeiture of the estate

UTLA § 2-304: Where the contract obliges the seller to convey real estate rather than his interest in real estate, a provision for conveyance by quitclaim deed does not of itself reduce the seller's obligation to?

Convey marketable title under § 2-304. Means that the buyer's only remedy for failure of marketable title is recission and he may not rescind once he has accepted the deed.

UTLA § 2-304: Seller of real estate must provide marketable time at time of conveyance, include warranties of title in the deed, and if the contract is for sale of a possessory interest, to be able to?

Deliver possession without court action or breach of peace.

If deed is blank, he warrants that property is free from all?

Encumbrances. (never happens). i. Usually subject to language.

§ 2-305 gives reasonable time to cure title defects after being informed of the defect however, as long as the buyer notifies the seller within 10 days after receiving the evidence of title, the seller's right to cure does not?

Extend his time for performance under the contract

Reasonably prudent person would not want to purchase due to?

Fear of litigation. i. Marketable title is Title which RPP would not subject to cloud

What is the policy out of Laba v. Carey?

Freedom to contract (problem was that this title was unmarketable because they were forced to buy a lawsuit)

Minority Approach; Nelson: When you ask for marketable title it is not perfect title, but reasonably secure from?

Hazards, annoyance and expense of litigation

Laba v. Carey: Rule: When one promises to deliver insurable and marketable title, this means that it must be?

Insurable without exception, unless the intent of the parties expresses otherwise. i. You can contract your rights away

UTLA § 2-304: Seller has the responsibility for furnishing evidence of?

Marketable title

No marketable title, then you can excuse buyer from?

Performance. (and get deposit back).

Where you are forced into a violation of a reciprocal covenant, you do not have to?

Purchase. i. Anyone could sue you

If no language, MT is?

Still presumed.

Buyer's Remedies: If unknown to seller, buyer's recovery is limited to?

The amount the buyer has paid on the contract plus incidental damages.

Buyer's Remedies: If defect was known to the seller when he signed the contract, the buyer may recover?

The excess of FMV at the time for conveyance over the contract price, plus incidental and consequential damages.

Laba v. Carey: Rule: Where a purchaser agrees to take title subject to easements and restrictive covenants of record which are not violated, this is the title that the seller is obligated to give, without contrary intent, the obligation is not expanded by?

The existence of an insurance clause. i. The subject to clause means that you waive your right to insurable property. ii. You have to respect the parties intent. (they could have taken the clause out).

What is Marketable Title?

Title that a reasonable and prudent business person, with knowledge of all the facts and their legal ramifications would accept.

Minority Approach; Voorheesville v. Tomkins: Although obtaining subdivision approval was a violation of the contract, this does not render title?

Unmarketable in itself

The USLTA limits title searches to 30 years and extinguishes earlier interests. However, may record notice of intent, if?

You have all of the documents.

What are some types of Titles?

a. General Warranty b. Special Warranty c. Quitclaim

What is an Anticipatory Breach?

i. Buyer cannot force seller into Anticipatory Breach unless proven that marketable title can never be obtained. (especially if he knows of the defect). 1. This is an objective event

What is a General Warranty?

i. The general warranty deed contains six specific covenants of title that warrant against any defect in the grantor's title ii. For example, the covenant against encumbrances warrants that there are no mortgages, easements, liens or other encumbrances on the property at the time the deed is delivered.

What is a Quitclaim?

i. The quitclaim deed contains no title covenants. ii. By its use, the grantor does not warrant that she owns the property or—if she has any title—that her title is good. iii. This type of deed merely conveys whatever right, title, or interest the grantor may have in the land.

What is a Special Warranty?

i. The special warranty deed usually contains the six title covenants found in the general warranty deed, but applies them only to defects caused by the acts or omissions of the grantor. ii. For example, suppose A, having no title whatever to a parcel of land, purports to convey title to B, and B in turn conveys to C using a special warranty deed; because the title defect was caused by A, not B, B is not liable to C.

What are types of violations?

i. Where forced to buy a lawsuit. ii. Where uninsurable (unless K around). iii. Any encumbrance that is not subject to.