All Forum Posts by: Peter Walther

I believe the current American Land Title Association Owner's Title Insurance Policy defines Insured as:

h. “Insured”: The Insured named in Item 1 of Schedule A and also the parties identified in Condition 2.b.

Section 2.b. reads:

b. This policy also insures:

i. anyone who receives Your Title by operation of law upon Your death;

ii. Your spouse who receives Your Title because of a dissolution of Your marriage;

iii. Your Estate Planning Entity to which You transfer Your Title after the Date of Policy;

iv. any beneficiary or distributee of Your Estate Planning Entity who receives Your Title;

v. anyone who receives Your Title by a transfer effective upon Your death as provided by law; or

vi. another Insured named in Item 1 of Schedule A.

So, if you, and perhaps your attorney, believes your LLC fits one of these definitions, it may be an Insured under the existing policy. You might also ask the title agent you're dealing with if they would be willing to issue an endorsement to the policy changing the name of the Insured to your LLC and if so, what would it cost.

I'm confused, I thought buying property subject to meant taking title (a deed) to property that had an existing loan on it that you (the buyer) were going to make the payments on.  If I understand this thread correctly, you (the buyer) have some sort of contract interest in the property rather than title to it.  Is that correct?

Just to be clear, whether the seller has a title policy or not is irrelevant since it can't be assigned to you. You need to either have the seller pay to have one issued to you or pay for it yourself. I suggest you close this sale at a title company rather than at the kitchen table, they'll see to the proper preparation of the docs and their recording. They'll also confirm there aren't any other liens or encumbrances on the property that need to be disposed of pre-closing. I'd tell them about the CFD and expect it to appear as an exception on the policy but even if you don't, there's an exclusion in the policy for matters you know about that the company doesn't. I'd get an estopple letter from the contract purchaser to confirm how much has been given to your seller. If you get a copy of the seller's deed from the public records and it was prepared and recorded by a title company, their file number is probably on it, most likely in the upper left-hand corner. I hope this helps.

I'm not certain it presupposes it, but it does require it.

When a person who has entered into a written contract for the sale and conveyance of an interest in real property dies before its completion, the executor or administrator of the decedent's estate, if not required to otherwise dispose of the contract, may, with the consent of the purchaser, obtain authority to complete the contract by filing an application for that authority in the probate court of the county in which the executor or administrator was appointed. Notice of the time of hearing on the application shall be given to the surviving spouse and heirs, if the decedent died intestate, and to the surviving spouse and devisees or legatees having an interest in the contract, if the decedent died testate. If the court is satisfied that it would be for the best interests of the estate, it may authorize the executor or administrator to complete the contract and to execute and deliver to the purchaser the instruments that are required to make the order of the court effective.

Section 2113.48 - Ohio Revised Code | Ohio Laws

I think your threshold question is who can you look to for failing to enforce the restrictions i.e. seller, real estate agent, attorney, title agent/insurer?  In my opinion, none of the above.  Since they don't have any kind of relationship with you, they don't have a duty to you, and you'll be lucky to get any one of them to talk to you.

As to the enforcement of the restrictions, assuming they are still valid and enforceable, as written by some of the posters above, anyone who has standing under the restrictions should be able to enforce them.  As also written above, figuring out who has standing can get complicated.  Based on what you've written it appears you not going to get the mobile home voluntarily removed so you'll probably have to pay an attorney to look into it and give you options.

You might talk with a real estate/estate attorney and see if it's possible to open a probate, have a Personal Representative appointed and obtain an order from the court authorizing the sale of the property by the PR with the proceeds being deposited into the registry of the court for later distribution when all the heirs are identified.  If the attorney thinks it can be done, obtain a title commitment before starting so you can be reasonably sure a policy will be issued when you're done.

I have run into situations where some of the heirs of the property owner have themselves died leaving heirs and beneficiaries and sometimes some of those heirs have also died.  The estate of each of those decedents may need to be delt with before proceeding with the property owner's estate.

Even if you get a title policy you may have a problem which is not covered.  If your seller files bankruptcy after the sale and the Trustee believes the sale was fraudulent because it was for below market value and seeks to set the sale aside, I think the title insurer might deny coverage.  The Exclusions From Coverage for a standard ALTA Owner's Title Policy provides:

The following matters are excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys’ fees, or expenses that arise by reason of:

4. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors’ rights law, that the transaction vesting the Title as shown in Schedule A is a:

a. fraudulent conveyance or fraudulent transfer;

b. voidable transfer under the Uniform Voidable Transactions Act; or

c. preferential transfer:

i. to the extent the instrument of transfer vesting the Title as shown in Schedule A is not a transfer made as a contemporaneous exchange for new value; or

ii. for any other reason not stated in Covered Risk 9.b.