Finance:Estoppel by deed
Estoppel is a common law doctrine which, when it applies, prevents a litigant from denying the truth of what was said or done.[1] The doctrine of estoppel by deed (also known as after-acquired title) is a particular estoppel doctrine in the context of real property transfers. Under the doctrine, the grantor of a deed (generally the seller of a piece of real property) is estopped (barred) from denying the truth of the deed. The doctrine may only be invoked in a suit arising out of the deed, or involving a particular right arising out of the deed.[2]
While rooted in warranty deeds, estoppel by deed has been extended to affect quitclaim deeds if the deed represents that the grantor actually had title. [3]
Examples
1. If O conveys property she doesn't own to A by warranty deed, but O later acquires title to that land, then title immediately passes to A.
2. However, if, as above, O conveys property she doesn't own to A by warranty deed, but O later acquires title to that land, A may elect to treat O's lack of title at the time of the conveyance as a breach of the covenants of seisin and right to convey (two of the six traditional forms of Covenants for Title that are contained in a general warranty deed), and sue O for damages. A cannot be forced to accept O's after-acquired title if she wishes instead to receive damages.[4][5]
3. If O conveys property she doesn't own to A by quitclaim deed, but O later acquires title to that land, then A owns nothing. This is because O passed her interest to A with a quitclaim deed; at the time of the conveyance, O's interest was nothing, so she passed nothing.
References
- ↑ Wallace v. Pruitt, 1 Tex. Civ. App. 231, 234, 20 S.W. 728, 728 (1892): "That the maker of a deed may be estopped to deny the truth of recitals therein is a well-settled doctrine of the common law."
- ↑ W. E. Coldwell Co. v. Cowart, 138 Ga. 233, 75 S.E. 425, 427 (1912), citing 16 Cyc. 699: "A recital works an estoppel only in an action founded on a deed, or brought to enforce rights arising under it."
- ↑ William B. Stoebuck & Dale A. Whitman, The Law of Property §11.5(3d ed. 2000)
- ↑ King v. Gilson's Adm'x, 32 Ill. 348, 354-55 (1863): "The covenants of seizin and of good right to convey are broken, if at all, when the deed is delivered. They are personal covenants, not running with the land, and are in presenti. Their breach depends upon no future contingency. They are, that the grantor is then seized, and has good right to convey. If he is not well seized, or if he has not the power to convey, when the deed is delivered, an action at once accrues, and a recovery may be had."
- ↑ Reece v. Smith, 276 Ga. 404, 406, 577 S.E.2d 583, 586 (2003), citing Yaali, Ltd. v. Barnes & Noble, Inc., 269 Ga. 695, 697(2), 506 S.E.2d 116 (1998): "[A] grantor who conveys by warranty deed an interest that he does not then own, but later acquires, will be estopped to deny the validity of the first deed. It is generally understood, however, that this doctrine cannot be used to transfer title or to cure flaws in the legal requirements for the creation of a property interest."
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