Chapter 5

Georgia Real Estate An Introduction to the Profession Eighth Edition Chapter 5 Transferring Title

Key Terms adverse possession bargain and sale deed cloud on the title color of title consideration covenant deed general warranty deed grantee grantor intestate succession quitclaim deed special warranty deed testate warranty © 2015 OnCourse Learning

Deeds A deed is a written legal document by which ownership of real property is conveyed from one party to the other. © 2015 OnCourse Learning

Deeds The Statute of Frauds requires that transfers of real estate ownership be in writing to be enforceable in a court of law. © 2015 OnCourse Learning

Essential Elements of a Deed The Grantor, typically the seller, must be named on the deed. The grantor must be of legal age and of sound mind. © 2015 OnCourse Learning

Essential Elements of a Deed The Grantee is typically the buyer. The grantee must be clearly identified, but is not required that they have full legal capacity. © 2015 OnCourse Learning

Essential Elements of a Deed Legal description, either a metes and bounds description or a reference to a recorded document, such as a plat. © 2015 OnCourse Learning

Essential Elements of a Deed Granting clause – the deed must clearly state the intention to convey the property from the grantor to the grantee. © 2015 OnCourse Learning

Essential Elements of a Deed © 2015 OnCourse Learning

Essential Elements of a Deed A deed is a contract between a grantor and grantee, and as such requires consideration. “…TEN AND 00/100 DOLLARS ($10.00) and any other good and valuable consideration…” © 2015 OnCourse Learning

Essential Elements of a Deed Restrictions and Exceptions The grantor may reserve an easement to access adjoining property. The transfer may place conditions on the use of the property, and the transfer may reserve certain rights, such as water rights, mineral rights or air rights. © 2015 OnCourse Learning

Essential Elements of a Deed The grantor is required to sign the deed. The grantee is NOT required to sign the deed. © 2015 OnCourse Learning

Essential Elements of a Deed For a deed to be valid, there must be delivery by the grantor and acceptance by the grantee, or a person acting on their behalf. The delivery and acceptance must take place during the lifetime of the parties. © 2015 OnCourse Learning

Covenants and Warranties The grantor can include certain covenants and warranties in the deed. A covenant is a written agreement or promise. A warranty is an assurance or guarantee that something is true as stated. © 2015 OnCourse Learning

Covenants and Warranties There are five covenants that can be included with a deed: Covenant of Seizin Covenant of Quiet Enjoyment Covenant Against Encumbrances Covenant of Further Assurance Warranty Forever © 2015 OnCourse Learning

Covenants and Warranties Under the covenant of seizin, the grantor guarantees to be the owner and possessor of the property being conveyed. © 2015 OnCourse Learning

Covenants and Warranties Under the covenant of quiet enjoyment, the grantor guarantees that the grantee will not be disturbed by someone else claiming an interest in the property. © 2015 OnCourse Learning

Covenants and Warranties The covenant against encumbrances guarantees to the grantee that the title is not encumbered with any easements, restrictions, unpaid property taxes, mortgages or judgments except as stated in the deed. © 2015 OnCourse Learning

Covenants and Warranties The covenant of further assurances requires the grantor to procure and deliver to the grantee any subsequent documentation that might be necessary to make good the grantee’s title. © 2015 OnCourse Learning

Covenants and Warranties Warranty forever is a guarantee to the grantee that the grantor will bear the expense of defending the grantee’s title. © 2015 OnCourse Learning

Covenants and Warranties The habendum clause is commonly known as the “to have and to hold” clause. © 2015 OnCourse Learning

Covenants and Warranties A date is common in the deed, but it is not required. The date of recording is the date the world is constructively notified of the grantee’s interest in the property. © 2015 OnCourse Learning

Covenants and Warranties Witnesses are required to record the deed. In Georgia, two witness are required. One witness must ben an official witness, usually a notary public. © 2015 OnCourse Learning

Covenants and Warranties Signed in front of witnesses creates an acknowledgment, which is a requirement for recording. © 2015 OnCourse Learning

Covenants and Warranties An acknowledgment is the witnessed declaration made by a person signing a document that his action was voluntary. Acknowledgment is a requirement to record at the county courthouse into public record. © 2015 OnCourse Learning

Covenants and Warranties Recording is the most effective way to provide constructive notice to the world of the owner’s interest in the property. It is not necessary to record a deed for it to be valid between parties. © 2015 OnCourse Learning

Covenants and Warranties If the deed is not recorded, a subsequent buyer could enter into a contract to purchase the property from the previous owner. © 2015 OnCourse Learning

Covenants and Warranties If there was no reasonable way to know that the person claiming to be the owner was not, the sale would be valid and the first buyer would have to take legal action against the seller. © 2015 OnCourse Learning

General Warranty Deed A general warranty deed contains all 5 covenants and warranties. This is the best deed a grantee can receive. © 2015 OnCourse Learning

Special Warranty Deed A special warranty deed warrants the property’s title only against defects occurring during the grantor’s ownership and not against defects existing before that time. A grantee can protect against this gap by purchasing title insurance. © 2015 OnCourse Learning

Bargain and Sale Deed A bargain and sale deed contains no covenants and only the minimum essentials of a deed. © 2015 OnCourse Learning

Quitclaim Deed A quitclaim deed has no covenants or warranties. Whatever rights the grantor possesses at the time the deed is delivered are conveyed to the grantee. If the grantor has no interest, none is conveyed to the grantee. © 2015 OnCourse Learning

Quitclaim Deed A title defect or a cloud on a title can be removed through the use of a quit claim deed. © 2015 OnCourse Learning

Other Types of Deeds A correction deed is used to correct an error in a previously executed and delivered deed. A name could have been misspelled or an error found in the property description. © 2015 OnCourse Learning

Intestate If a person dies without leaving a last will and testament, they have died intestate. State law directs how the deceased assets will be distributed by intestate succession. If no heirs can be found, the deceased property escheats to the state. © 2015 OnCourse Learning

Testate A person who dies and leaves a valid will dies testate. The person who made the will is the testator. © 2015 OnCourse Learning

Testate Real property that is willed is known as a devise. Personal property that is willed is known as a bequest or legacy. © 2015 OnCourse Learning

Testate The testator usually names an executor or executrix to carry out the instructions. If no one is named, the court appoints an administrator. © 2015 OnCourse Learning

Testate Once a deed is made and delivered, the ownership transfer is permanent. The grantor cannot have a change of mind. © 2015 OnCourse Learning

Testate With a will, the devisees have no rights to the testator’s property until the testator dies. © 2015 OnCourse Learning

Probate or Surrogate Court Upon death, the deceased’s will must be filed with a probate court. © 2015 OnCourse Learning

Probate or Surrogate Court If the testator owned real property, its ownership is conveyed using an executor’s deed. An executor’s deed is a special warranty deed. © 2015 OnCourse Learning

Protecting the Deceased’s Intentions All states recognize the formal or witnessed will. This is prepared most often by an attorney. © 2015 OnCourse Learning

Holographic Will A holographic will is a will that is entirely handwritten. There are no witnesses. Holographic wills have no effect in Georgia. © 2015 OnCourse Learning

Oral Will An oral will is also known as a nuncupative will, is a will spoken by a person who is very near death. © 2015 OnCourse Learning

Oral Will Oral wills are recognized in Georgia, but they must be witnesses by two people with no interest in the estate. It must be put into writing within 30 days. © 2015 OnCourse Learning

Codicil A codicil is a written amendment to a previously existing will. The codicil must be dated, signed and witnessed in the same manner as the original will. © 2015 OnCourse Learning

Adverse Possession Through the unauthorized occupation of another person’s land for a long enough period of time, it is possible to acquire ownership by adverse possession. © 2015 OnCourse Learning

Adverse Possession The claimant must have maintained an actual, visible, continuous, hostile, exclusive and notorious possession and publicly claim ownership of the property. © 2015 OnCourse Learning

Adverse Possession The use must have been without permission. The claimant must be able to prove that he has met these requirements for 20 years in Georgia, 7 if the claimant has color of title. © 2015 OnCourse Learning

Color of Title If the claimant has been paying the property taxes, the required occupancy period is shortened. Color of title suggests the appearance of ownership interest. © 2015 OnCourse Learning

Color of Title Claimants can add on their period to another adverse possessor through tacking. © 2015 OnCourse Learning

Color of Title Another source of adverse possession is through encroachments. If a building extends over a property line and nothing is said about it for a long enough period of time, the building will be permitted to stay. © 2015 OnCourse Learning

Easement by Prescription An easement can be acquired by prolonged adverse use is an easement by prescription. The usage must be openly visible, continuous, and exclusive, as well as hostile and adverse to the owner. © 2015 OnCourse Learning

Easement by Prescription In Georgia, the use must be over 7 years for private property; 20 years for public property. © 2015 OnCourse Learning

Easement by Prescription An easement is a right to use land for a specific purpose and not ownership of the land itself. © 2015 OnCourse Learning

Easement by Prescription An owner can break it by ejecting the trespassers, by preventing them from trespassing or by giving them permission to be there. © 2015 OnCourse Learning

Ownership by Accession Accretion is the addition of land because of the gradual accumulation of rock, sand and soil fronting a lake, river or ocean. Alluvion is the increase of land that results when soil is gradually deposited to produce firm dry ground. © 2015 OnCourse Learning

Ownership by Accession Reliction results when a lake, sea or river permanently recedes, exposing dry land. When land gradually wears away because of the action of wind or water, this process is known as erosion. © 2015 OnCourse Learning

Ownership by Accession When land is rapidly washed away by the action of water, it is known as avulsion. © 2015 OnCourse Learning

Ownership by Accession Manmade accession occurs through annexation of personal property to real estate. For example: when loose rocks are used to form a permanent retaining wall, the rocks are annexed to the land. © 2015 OnCourse Learning

Public Grant and Dedication A transfer of land by a government body to a private party is called a public grant. When an owner makes a voluntary gift for the use of land to the public, it is known as a dedication. © 2015 OnCourse Learning

Alienation of Title A change in ownership of any kind is an alienation of title. Alienation means to transfer. © 2015 OnCourse Learning

Alienation of Title Alienation can result from escheat, eminent domain, partition, foreclosure, quiet title suits and marriage. © 2015 OnCourse Learning