When Does Conveyance Occur?

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 What Is Real Property Conveyance? When Does Conveyance Occur?

In property law, conveyance refers to the act of transferring the title to a piece of property from one person to another. An example of this would be a home or commercial real estate. A conveyance occurs when the owner of property (or grantor) uses words of conveyance in order to transfer an interest in property to the person receiving the property (or grantee).

The term “words of conveyance” refers to a clause that is included in a property’s deed. This clause states that the grantor intends to convey title to the land. Words of conveyance may also be referred to as a Granting Clause.

A person is said to convey the property when they manifest an intent to transfer it to another. This is generally done by transferring the deed to the property as a formal act, which shows that the conveyance has occurred. The deed must be signed and in writing, and should also describe the land that is being transferred with sufficient accuracy.

It is important to note that actual transfer of the physical deed is not always required in order for a conveyance to have occurred. All that is required to happen would be some event showing that the deed holder intended to make the transfer. Once the deed has been transferred, the recipient should promptly record the transfer with a county recorder’s office. This will provide evidence of conveyance, should there be any questions associated with property ownership in the future.

Are There Different Types Of Real Property Conveyance?

Generally speaking, there are four recognized methods of conveyances of real property. Although there are variations contained within the four types, courts will not recognize the transfer if the language of the conveyance does not fit within one of these four categories.

The four recognizable conveyance categories are:

  1. Fee Simple Absolute (or Fee Simple): When speaking words of conveyance, the owner will generally transfer what is known as “fee simple”. Fee simple is not the property itself; rather, it is the actual interest in the property, or the right to do certain legal things with the property. Fee simple generally entails that the property can be possessed, and that the property can be passed along to a person’s heirs. Additionally, there are many different types of fee simple. Fee simple absolute is the most common type, as well as the type that encompasses the most rights. Conveying fee simple absolute to property entails that the owner has the right to:
    • Possess the land or property;
    • Alienate the land, which means to transfer it to another person; and
    • Exclude others from using the land.
  2. Fee Tail: A fee tail is a type of conveyance that is intended to preserve the estate in the bloodline of the person who is receiving the property interest. Because of this, only the children of a fee tail holder will benefit from a fee tail. Additionally, if the holder of a fee tail dies without children, then both the bloodline and the fee tail end and the property goes back to the original grantor. Only Delaware, Massachusetts, Maine and Rhode Island recognize fee tails. In states in which the fee tail has been eliminated, courts have interpreted fee tails in one of two ways. Some states will change the fee tail into a fee simple, which gives the original person receiving the property the entire interest in the property. Other states will convert the fee tail into a life estate, which is discussed further below. Once the life estate ends, the property will go to the heirs of the life estate holder through a fee simple.
  3. Life Estate: A life estate is an interest in property that is measured by the duration of an individual’s life, generally the person who is receiving the property. A life estate would be a form of joint property ownership.It allows one person to remain living in their home until their death, at which time the home passes to the other owner. A legal life estate is created by the person who owns the property and it is given to the recipient. Life estates are generally utilized in order to convey property between relatives, or close friends. These arrangements are particularly useful for situations in which the property may be used by another person for an extended period of time, but the owner wishes for the property to revert to their own possession for legal purposes. The defining feature of a life estate is the fact that the property will return to the original grantor, which is referred to as a “reversion.”
  4. Fee Simple Defeasible: A fee simple defeasible may have conditions or limitations placed on the interest. If the conditions or limitations are violated, the property interest may either go back to the original owner or to a specified third party. Because there are different types of fee simple defeasible, this concept will be discussed further below.

What Is Fee Simple?

As discussed above, a fee simple is an interest in property that has two unique characteristics. The property may be possessed infinitely, and may be inherited by one’s heirs. A property interest cannot be a fee simple if either one of these qualities is not present.

There are two types of fee simple property interests:

  1. Fee simple defeasible, and
  2. Fee simple absolute.

To reiterate, a fee simple defeasible is a conveyance of property that has conditions placed on it. The holder of a fee simple defeasible possesses the property as a fee simple based on that condition. If the condition is violated or not met, then the property will either go back to the original grantor or to a specified third party.

There are three different types of fee simple defeasible. The first two confer future property interests to the person granting the property, while the third type has the future interest going to a specified third party.

  1. Fee Simple Determinable: A fee simple determinable automatically ends the interest in the property when a condition is violated, or is not met. The person granting the property interest retains a “possibility of reverter,” meaning that if the condition is violated, the property will automatically shift back to the grantor without any further action.
  2. Fee Simple Subject To Condition Subsequent: A fee simple subject to a condition subsequent is very similar to the fee simple determinable. The difference is that the violation of the condition would give the original owner the option to take back the property. As such, the property does not automatically shift to the original owner; rather, upon violation of the condition, the original owner has the option to reassert a right to the property. This option is called a “right of reentry”
  3. Fee Simple Subject To Executory Limitation: A fee simple subject to executory limitation is essentially the same as a fee simple defeasible, except that it confers a future property interest to a third party and not the original owner.

What If I Have A Dispute Over Conveyance Of Property?

Disputes involving conveyances of land or property should generally be addressed by the court, as there are many different legal aspects involved. In some cases, a damages award will be sufficient in terms of helping a party recover losses associated with the dispute. In other cases, the court may award title to a particular party. An alternative remedy might involve rewriting a sales contract in order to reflect new information regarding the land.

To reiterate, a proper recording of a conveyance transaction can help prevent many different types of legal disputes and contests from arising later on.

Do I Need An Attorney For Property Conveyance?

In order to reduce the likelihood of disputes associated with conveyance of property, you should consult with a local property lawyer. An experienced and local real estate attorney will be most aware of your locality’s laws regarding the matter, and what your legal options are under those laws. Additionally, an attorney will also be able to represent you in court, as needed.

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