Deed Basics

As spring approaches and hopefully sales pick up once again people will be buying and selling property. Many people think the key document in this transaction is the contract, and while it is important, the document that matters most is the deed, the document that actually transfers the title from the buyer to the seller.

Sounds simple, right? Seller signs the deed, which says their selling to buyer, and case closed, right? In most cases, yes. But more often than we’d all like, the answer is no. So let’s get the basics behind deeds over the next couple of days.

First, for a deed to be valid you have to have competent, identifiable parties. By competent, I mean legally competent people on both sides, and no minors. It can also be LLCs, corporation, unincorporated assocations, etc. This goes for both sides of the deal, the party who is giving the property (grantor) and the party receiving (grantee).

Second, the land must be described, and clearly. You can get away with a street address sometimes, but it’s not a good idea. The best decision is to use a legal description.

Third, “valid consideration”. “Consideration” can be almost anything of value, but you must give SOMETHING of value. The qualifier of “valid”, while I couldn’t find any cases, would probably keep you from trading property for a human slave, for sex, etc.

Fourth, you need “effective words expressing the fact of transfer or grant”, which basically means you need the phrase X “grants, bargains or sells” the real property to Y, or similar words. Courts are looking for terms expressing that the property is being transferred.

Fifth, you need formal execution, in other words the grantor has to sign, confirming that they intend to do what the deed says they are doing.

Finally, we need delivery. It seems simple, but if I execute a deed of my property to you, but it just sits in my desk until after I’m dead, you likely don’t get it. Or if you die first, your heirs don’t get to claim it. Now, if I record the deed at the courthouse, even if I don’t tell you, then the court will presume delivery.

Many of these seem pretty basic, I realize, but there is a case on every one of these elements in Arkansas jurisprudence. Which means people have fought to declare a deed valid or invalid all the way to the Arkansas Court of Appeals or Arkansas Supreme Court arguing that one of the elements above was met or missing.

Tomorrow, we’ll go over the various types of deeds, from quitclaim to wild deeds.