Conveying Title by Deeds

• Author: Alan R. Romero
• Profession: Professor of law and Director of the Rural Law Center at the University of Wyoming College of Law
• Pages: 273-294

Chapter 16

Conveying Title by Deeds

In This Chapter

▶ Merging deeds and purchase agreements

▶ Drafting valid deeds

▶ Delivering and accepting deeds

▶ Warranting title

T

itle to land means ownership of land, so saying that a person has title

doesn’t mean that she possesses a legal document; it means she’s the

legal owner.

Although there are other ways of obtaining title to land, the most common

way that people get title is by a deed. Unlike title, a deed is a legal document,

a way to convey title from a grantor to a grantee. A deed may do more than

convey title, however. Deeds also commonly include warranties or covenants

of title from the grantor to the grantee. Deed warranties are essentially the

grantor’s promises to pay damages to the grantee for certain title problems.

In this chapter, I present the requirements for a deed to validly transfer title

as well as the ways in which deeds may warrant title.

Merging a Purchase Agreement

with a Deed

The buyer and seller of real estate typically sign a purchase agreement, an

executory contract that obligates the parties to buy and sell the real estate

on certain conditions. They may make various promises and representations

in their purchase agreement, as I explain in Chapter 15.

274 Part IV: Acquiring and Transferring Property Rights

The purchase agreement governs the parties’ relationship until closing, when

the seller gives a deed to the buyer and the buyer gives the purchase money

to the seller. At that point, the purchase agreement is said to merge with the

deed, although maybe it would make more sense to say that the deed replaces

the purchase agreement. By delivering a deed and the purchase money, the

parties indicate that the conditions of the purchase agreement have been met

or that they waive the failure of any conditions that haven’t been met. They

also indicate that they accept the other party’s performance of its obligations

under the purchase agreement. That indication is especially strong when the

deed addresses the same subject as the purchase agreement.

If either party feels that a condition hasn’t been met or that the other party

has breached a covenant in the purchase agreement, she must demand perfor-

mance before closing, waive the objection, or expressly agree with the other

party to go forward with the closing and resolve the objection after closing.

The merger doctrine has some exceptions. Even after closing, a party may

enforce terms of the purchase agreement in the following situations:

✓ Express intent to survive closing: The parties can enforce a term of the

purchase agreement if the parties clearly indicated their intent that the

term would be enforceable after closing, such as by a clause saying that

the particular term would survive closing.

✓ Promises to be performed after closing: The parties can enforce purchase-

agreement promises that are intended to be performed after closing. A

simple example is a promise in the purchase agreement that says the

seller will make certain repairs on the house within a certain time period

after closing. The parties obviously would intend that promise to be

performed and enforceable after closing.

✓ Collateral provisions: The deed transfers title and possession to the

grantee and may warrant that title. The deed doesn’t generally include

any other types of promises. So if the purchase agreement includes

promises that aren’t related to the transfer of title and possession, and if

the deed says nothing about those promises, there’s no reason to think

that the deed was meant to take the place of those provisions of the

purchase agreement.

✓ Fraud: A party can sue the other for fraud after closing, despite the

merger doctrine. For example, if the purchase agreement represented that

the heating system worked and the seller lied in telling the buyer that she

recently had the heating system inspected and it worked fine, the buyer

could sue the seller for fraud even after closing.

✓ Mutual mistake: A mutual mistake exists when both parties share a

mistaken belief and their written agreement therefore doesn’t reflect

their actual agreement. For example, a drafting mistake in the deed’s

legal description of the conveyed property may be a mutual mistake,

and a party may have the deed reformed after closing to reflect the

parties’ actual agreement.