Professional Documents
Culture Documents
Title Assurance
Sale of real property is actually a sale of title
Three methods of title assurance
o Title covenants: the grantor promises in the deed that he has good title to
convey
o Title opinion based on search of public records: attorney or other professional
renders an opinion about the state of the title after searching the public records
o Title insurance: a title insurance company issues a policy that insures the
grantees title
Best practice is to use multiple of the above methods
Title covenants
o Express promises by the grantor about the state of the title
o At common law, the promises ended at closing unless they were restated in the
deed
Doctrine of merger provided that once the grantee accepted the deed all
prior promises were extinguished, and the contract was merged into the
deed
o Three commonly used deeds
General warranty: grantor warrants title against all defects, whether they
arose before or after he obtained title (best protection)
Special warranty deed: the grantor warrants title against all defects that
arose after he obtained title
Limits the grantor’s assurances only to any defects that arose
during his ownership. Doesn’t cover any problems created before
he obtained title
Quitclaim deed: the grantor makes no warranties about title, so the
grantee receives only what the grantor has, if anything
o Six standard covenants
Covenant of seisin
Promise that grantor owns the estate he purports to convey
Covenant of right to convey
Promise that grantor has the right to convey title
Covenant against encumbrances
Promise that there are no encumbrances on the title other than
those listed
Covenant of warranty
Grantor will defend the grantee against any claim of superior title
Covenant of quiet enjoyment
Grantee’s possession of the property will not be disturbed by
anyone holding superior title, this covenant would be breached if
the grantee is evicted because of a title defect
Covenant of further assurances
Promise that grantor will take all future steps reasonably
necessary to cure title defects that existed at closing
Brown v. lober
o The mere existence, without more, of a superior title does not constitute a
breach of quiet enjoyment
Recording Acts
Each state has a recording act which establishes the method for determining priority
between adverse claimants
o Race
Purchaser who records first has priority over a previously created interest
even if actually knows about that interest
Priority given to the race winner
o Notice
The subsequent bona fide purchaser has priority
o Race-notice
The subsequent bona fide purchaser who records first has priority
Protects the subsequent purchaser for value who both takes without
notice and records first
Exception to first in time recording
o Bona fide purchaser doctrine
Vibrant property market demands that buyers have confidence they will
receive good title
Protect buyers from adverse claims
Case
o Messersmith v. Smith
Recording of a title instrument that does not meet the recording act’s
statutory requirements does not provide constructive notice of the
transfer to subsequent buyers
Zimmer rule (holman says we’ll just assume it applies for testing)
o Subsequent Purchaser is deemed to have recorded his conveyance only if all
prior conveyances in his chain of title are properly recorded
Shelter rule
o A bona fide purchaser is allowed to transfer his protection
o Zoning amendments
Like any law, a zoning ordinance may be amended
Land zoned for ag use only can be rezoned for single family
residences by an amendment to the ordinance
Rezoning comes with dangers
Threatens the goal of comprehensive land use planning
o May make zoning plans meaningless
Heightened risk of government corruption
Constitutionality of rezoning reviewed under the same standard applied
to a new zoning ordinance
Rezoning valid unless it is clearly arbitrary and unreasonable,
having no substantial relation to the public health, safety, morals,
or general welfare
Some states use the change or mistake approach
o Rezoning valid if
Conditions in the zone have significantly changed
Or a mistake was made in the original zoning
ordinance
Cases
Smith v. City of little rock
o Rezoning a previously residential property in a residential
neighborhood is not inherently arbitrary and capricious
o Presumption that a zoning boards act reasonably and fairly
when rezoning or refusing to rezone
Challenging a boards zoning decision comes
w/burden of establishing the board’s decision was
arbitrary and capricious
o Spot zoning
Exists when a zoning amendment
Singles out a small parcel of land for different treatment
Primarily for the benefit of the private owner, rather than the
public
In a manner inconsistent with the general plan for the community
Some jurisdictions find spot zoning even if one of those conditions are
absent
o Zoning Variances
Case
Detwiler v. Zoning Hearing Board of Lower Salford Township
o Applicant for a zoning variance must show the variance
will not harm the public interest and is necessary to relieve
an unnecessary hardship, not self-inflicted, that uniquely
affects the property in question
o Hardship may take many forms and is not limited to
restrictions that deprive the property of any value
Exists only if applicant shows the property in
question cannot be put to use without the variance
o Hardship is self-inflicted only where the applicant paid a
high price for the property, anticipating a variance would
be granted justifying the price
o The variance must be the minimum necessary to relieve
the hardship, may not have a negative impact on the
public’s health, safety, or welfare
Types of variances
Area variance
o Permits modification of lot size, setback, height, frontage,
density, or similar requirements
Use variance
o Permits a type of use otherwise prohibited
o Conditional uses
Use permitted in the zone if certain conditions specified in the zoning
ordinance are met
Typically utilized to regulate uses that might cause aesthetic, noise,
traffic, or other problems
Unlike a variance, the conditional use is a use authorized by the
ordinance- but one that must be regulate on a case-by-case basis to avoid
injury to existing nearby uses
o New approaches to land use regulation
Conditional zoning
Rezoning a particular parcel when the owner satisfies conditions
imposed by the city or county, in order to mitigate the impact of
the zoning change
Floating zone
A zoning district with detailed provisions which does not have a
specific location until an owner applies to have the zone applied
to her property
Cluster zone
A residential zone that restricts the number of homes, but allows
the developer choice about where the homes will be located; this
permits the clustering of residences and encourages preservation
of open space
Planned unit development
Zoning that allows a developer to plan an entire community
subject to guidelines for density and other concerns; this is
essentially cluster zoning extended to all uses