Warranty Deeds

Now that we’ve established the basic elements of a deed, let’s look at the various types of deeds. This article will focus on the warranty deed, the most common deed used in real estate transactions.

A warranty deed is also the most complete method of transferring land, due to the warranties the seller gives the buyer. Arkansas Code section 18-12-102 lays out exactly what the seller is giving the buyer:

(b) The words, “grant, bargain and sell” shall be an express covenant to the grantee, his or her heirs, and assigns that the grantor is seized of an indefeasible estate in fee simple, free from encumbrance done or suffered from the grantor, except rents or services that may be expressly reserved by the deed, as also for the quiet enjoyment thereof against the grantor, his or her heirs, and assigns and from the claim and demand of all other persons whatever, unless limited by express words in the deed.

So, what’s that mean in non-lawyer English? First, “an express covenant to the grantee, his or her heirs, and assigns . . . ” That phrase basically means that the seller is giving the buyer and his subsequent transferees, warranties that:

1. “the grantor is seized of an indefeasible estate in fee simple”. In short, the person transferring the land owns whatever is described in the legal description free and clear. Now, the legal description may have caveats for easements, mineral rights, etc., but whatever he claims he owns he is transferring to the buyer.

2. “free from encumbrance done or suffered from the grantor”. The seller is giving the property free of any mortgages or liens to the buyer. These also include unknown claims that may exist at the time of the transfer, such as materialmen’s liens which have not been filed prior to transfer.

3. “except rents or services that may be expressly reserved by the deed”. What this phrase is saying is if the seller wants to keep an interest in the property via the deed, including the right to collect rent from the property, it better be clear in the deed itself.

4. “as also for the quiet enjoyment thereof against the grantor, his or her heirs, and assigns and from the claim and demand of all other persons whatever, unless limited by express words in the deed”. Essentially, the right to recover against the seller if you’re the buyer and you subsequently find out someone else is claiming your property, or a part of it, either by adverse possession or a previous deed your seller forgot to mention, or even someone claiming an easement. Your seller warrants you will have the “quiet enjoyment” of the property he is delivering to you via the deed.

Note the reference to “unless limited by express words in the deed.” That would mean such things as easements, covenants related to the subdivision, or limits on use such as a donation of property for as long as it is used for school purposes. These limits must be referenced in the deed if the seller wants to avoid warrantying that they do not exist.

If you are paying full value for a piece of property, you need to make sure you are getting a warranty deed. You want your seller to give you these warranties. A quitclaim deed should never be enough for a full purchase price. We’ll discuss quitclaim deeds in a future post, as well as look at cases regarding the warranties above.