During escrow for a residential property in Pasadena, the buyer and seller provide separate, conflicting escrow instructions regarding who pays for the home warranty. The escrow officer notices the discrepancy. Under California escrow law, what should the escrow officer do?
Correct Answer
D) Notify both parties of the conflict and refuse to proceed on that item until they reach a mutual agreement
Under California escrow law, the escrow officer must follow only mutually agreed-upon instructions. When conflicting instructions are received, the escrow officer cannot independently resolve the dispute. The officer must notify both parties of the discrepancy and wait for mutual instructions before proceeding. The escrow holder has a fiduciary duty to both parties and cannot favor one over the other.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Adverse possession is a legal doctrine that allows a person to claim ownership of land by occupying it continuously for a statutory period under specific conditions, without the true owner's permission.
A bargain and sale deed implies that the grantor holds title and possession of the property but does not include warranties against encumbrances or title defects.
The chain of title is the sequential history of all transfers of ownership for a specific property, from the original source (typically a government patent or grant) to the present owner. An unbroken chain is essential for marketable title.
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