A buyer purchases a single-family home using a California grant deed. After closing, the buyer discovers that the seller personally granted an easement to a neighbor for driveway access before the sale and never disclosed it. Under the implied warranties of a California grant deed, does the buyer have a claim against the seller?
Correct Answer
B) Yes, because a grant deed warrants that the estate is free from undisclosed encumbrances made by the grantor
Under California Civil Code §1113, a grant deed carries an implied warranty that the estate is free from encumbrances done, made, or suffered by the grantor that have not been disclosed to the grantee. Because the seller personally created the easement and failed to disclose it before closing, the buyer has a valid claim against the seller for breach of this implied warranty.
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Related Concepts
A special warranty deed guarantees that the grantor has not caused any title defects during their period of ownership, but does not warrant against defects that existed before the grantor acquired the property.
Title insurance is a policy that protects the insured party against financial loss from defects in title that were not discovered during the title search. Unlike other insurance, it covers past events rather than future risks.
A title search is an examination of public records to determine the history of ownership, liens, encumbrances, and other interests affecting a property. It verifies that the seller has the legal right to transfer the property.
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Which type of deed is used in the vast majority of California residential real estate transactions and carries two implied warranties under California Civil Code §1113?
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Under California law, which deed transfers whatever interest the grantor may hold without making any warranties about the quality of title?