😀
Real Property • Conveyances
PROP#159
Legal Definition
A defect in the chain of title may make the title unmarketable. Title acquired by adverse possession is unmarketable (unless judicially confirmed). When a holder of a future interest is unborn or unascertained, title is unmarketable.
Plain English Explanation
A defect in the chain of title can mess up an otherwise clean property deal by making the title unmarketable. When we say a title is “unmarketable,” it means there’s some issue that could cause problems for the buyer, making it risky or difficult to sell or transfer later on.
Here are a couple of common ways a defect can cause trouble:
(1) Adverse possession: If someone claims ownership of a property because they’ve been using it for a long time (adverse possession), their title to the property might not be considered marketable unless a court has officially confirmed their ownership. Without that stamp of approval, the buyer would be nervous about whether the previous owner's claim is fully legit.
(2) Unborn or unascertained future interest holders: Let’s say the property is supposed to go to someone in the future, but that someone either hasn’t been born yet or we don’t know who they are. In that case, the title is unmarketable because it’s not clear who actually has the right to the property, making it impossible to guarantee full ownership to a buyer.
Here are a couple of common ways a defect can cause trouble:
(1) Adverse possession: If someone claims ownership of a property because they’ve been using it for a long time (adverse possession), their title to the property might not be considered marketable unless a court has officially confirmed their ownership. Without that stamp of approval, the buyer would be nervous about whether the previous owner's claim is fully legit.
(2) Unborn or unascertained future interest holders: Let’s say the property is supposed to go to someone in the future, but that someone either hasn’t been born yet or we don’t know who they are. In that case, the title is unmarketable because it’s not clear who actually has the right to the property, making it impossible to guarantee full ownership to a buyer.
Related Concepts
At closing, what is the implied covenant of marketable title?
How does a court treat a deed made to defraud creditors?
How does a court treat a voidable deed?
How does a court treat a void deed?
How does the Statute of Frauds apply to land sale contracts, and what is the effect of part performance?
How may an encumbrance impact an Implied Covenant of Marketable Title?
How may zoning impact an Implied Covenant of Marketable Title?
In assessing a conveyance of land, what are the types of notice?
In assessing a Doctrine of Equitable Conversion issue, how does death affect passage of title?
In assessing a Doctrine of Equitable Conversion issue, how does the Uniform Vendor and Purchaser Risk Act affect risk?
In assessing a seller's liabilities for defective real property, what constitutes failure to disclose?
In assessing a seller's liabilities for defective real property, when is a disclaimer sufficient to avoid liability?
In assessing a seller's liabilities for defective real property, when is a seller liable for defects they do not mention?
In assessing a seller's liabilities for defective real property, when is a seller liable for misrepresentation or fraud?
In assessing a seller's liabilities for defective real property, when is there a warranty of fitness or quality?
In assessing deed warranties, what is Against Encumbrances?
In assessing deed warranties, what is Right to Convey?
In assessing the formalities of a deed, what are the rules of construction and priority for the description of the land?
In assessing the formalities of a deed, when is acceptance valid?
In assessing the formalities of a deed, when is a description of land sufficient?
In assessing the formalities of a deed, when is delivery valid?
In assessing the warranties under a general warranty deed, what is Further Assurances?
In assessing the warranties under a general warranty deed, what is Quiet Enjoyment?
In assessing the warranties under a general warranty deed, what is Seisin?
In assessing the warranties under a general warranty deed, what is Warranty?
In land sale contracts, when is time of the essence?
In land sale contracts, when must each party tender performance?
Under a notice recording statute, when does a subsequent Bona Fide Purchaser prevail?
Under a race-notice recording statute, when does a subsequent Bona Fide Purchaser prevail?
Under a race recording statute, when does a subsequent Bona Fide Purchaser prevail?
What are the 3 types of deeds and warranties?
What are the requirements for a valid deed?
What is a general warranty deed?
What is a quitclaim deed?
What is a special warranty deed?
What is a wild deed?
What is estoppel by deed?
What is the Doctrine of Equitable Conversion?
What is the Shelter Rule?
What remedies are available to a buyer upon violation of an Implied Covenant of Marketable Title?
What remedies are available to parties of a land sale contract if one of them breaches?
When may a deed be an inter vivos gift?
Who does title insurance protect?
Who qualifies as a purchaser for value?
