Buyer Angela purchases a home in Royal Oak using a general warranty deed. Her seller, Brian, had acquired the property by quitclaim deed from a previous owner. Two years later, a title defect is discovered that predates even the previous owner's acquisition. Angela sues Brian under the general warranty deed covenants. Brian argues he cannot be liable for a defect that existed before the quitclaim deed he received. Under Michigan law, which of the following BEST describes the outcome?
Correct Answer
B) Brian is liable under the general warranty deed he gave Angela, regardless of the type of deed he received
Under Michigan law, a grantor who conveys property by general warranty deed is bound by the covenants in THAT deed, regardless of the type of deed by which the grantor acquired title. Brian chose to convey to Angela using a general warranty deed, which includes a covenant to defend title against ALL claims — including those predating his ownership. The fact that Brian received only a quitclaim deed from his predecessor does not limit the warranty he made to Angela. Brian warranted more than he received, and he is now exposed to liability for that broader warranty. This is a classic trap: grantors must be careful about what type of deed they issue, as they are bound by the covenants they make regardless of their own chain of title.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Community property is a form of ownership recognized in certain states where property acquired during marriage is considered equally owned by both spouses, regardless of who earned the money or whose name is on the title.
Condominium ownership involves owning a unit of airspace within a multi-unit building plus an undivided interest in the common elements shared with other unit owners. Each unit is separately taxed and financed.
In a cooperative (co-op), the building is owned by a corporation, and residents purchase shares of stock in the corporation that entitle them to a proprietary lease on a specific unit. Residents are shareholders, not property owners.
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