Selling Property? Read the Deed!

I was recently contacted about a lawsuit where the first owner, let's call him Alan, sold his ranch to the current owner, let's call him Bob. So 20-30 years ago Alan and Bob agreed that Alan would sell Bob the ranch but Alan would keep the mineral interest under the ranch. They enter into a written agreement for the sale, Bob signs a mortgage, and Alan signs a deed. Everything goes on for awhile until the mortgage is paid off. Bob tells Alan he needs to sign a release of mortgage and quitclaim deed. Alan does as Bob requests and signs the documents. Everything is filed of record in the county clerk's office. So what's the problem?

The problem is that everything prior to the quitclaim deed said that it was for the sale of "Surface rights only". The quitclaim deed, whether through error or malicious intent, lacked such language. This is a problem because when you sign a deed you convey everything you own in the property which is described unless you put some sort of limiting language in the deed such as "surface rights only". If an error of this sort is made, there is a very limited window of time in which the error can be corrected- typically five years. Beyond that window you must be able to show that there was fraud involved and that can be incredibly difficult to do.

So what can we learn from Alan's situation? First, ALWAYS READ BEFORE SIGNING. This applies to any document but especially to documents which transfer or could potentially divest you of an ownership interest. Second, if you are selling a surface interest and nothing more, then say so by using limiting language such as "Surface and surface rights only". It could be that you own some other interest, such as minerals, that you are unaware of at the time of signing the deed. It could also be that if you are only selling a portion of your property that the deed describes and therefore conveys more than what you are intending to sell. Finally, if you have questions, contact an attorney and don't try to do it yourself like Alan and Bob.

I have helped owners buy and sell residential and business properties and would be happy to help you do the same. Head over to the Contact page to schedule a time to discuss your property.

AS ALWAYS THIS POST AND THE INFORMATION CONTAINED HEREIN ARE FOR INFORMATIONAL PURPOSES ONLY. THIS IS NOT LEGAL ADVICE AND DOES NOT CREATE AN ATTORNEY-CLIENT RELATIONSHIP SINCE WE DO NOT HAVE ENOUGH INFORMATION REGARDING YOUR SPECIFIC CIRCUMSTANCES TO RENDER SUCH ADVICE. IF YOU NEED LEGAL ADVICE, PLEASE CONTACT A LICENSED ATTORNEY.