Real Estate Law Quiz

A seller of real estate in Minnesota has a legal duty to disclose known material facts that could significantly impact an ordinary buyer's intended use of the property. The seller must act in good faith and disclose all information to the best of their knowledge.

This doctrine applies when a party makes a false representation of a material fact, knowing it's false or being ignorant of the truth, with the intent to deceive the other party, leading to detrimental reliance and injury.

A deed is legally effective when it is delivered by the grantor with a present and unconditional intent to transfer ownership. Physical delivery is not always required, but the grantor must relinquish control and express a clear intention to convey title.

If a deed is signed but not delivered during the grantor's lifetime, the deed is void. This means the transfer of ownership never occurred.

A court may not recognize the legitimacy of a corporation if it was created fraudulently to evade legal obligations. This prevents someone from creating a corporation solely to avoid liability for a previous transaction.

A seller of real estate in Minnesota is generally not required to disclose information about AIDS, suicide, paranormal activity, nursing homes, or the presence of predatory offenders on the property.

A claim for nondisclosure in real estate requires proof that the seller had a duty to disclose hidden facts, these facts presented an unreasonable risk of harm, and the seller knew the buyer would not be able to recover for the harm. This applies when the buyer suffers damage due to the seller's failure to disclose.

A quitclaim deed allows a person to relinquish any legal interest they may have in a property without any warranties. This is often used to transfer ownership after a death, but it doesn't guarantee the recipient will have clear ownership.

A legal document that transfers ownership of property. To be valid, it must be delivered to the new owner (grantee).

A legal principle stating that rights acquired by a grantor after selling a property automatically transfer to the buyer. For example, if a grantor later discovers oil rights on the sold property, the buyer acquires those rights.

A legal principle stating that when a property is foreclosed upon and then reacquired by the original owner, any existing junior mortgages are reinstated.

A clause in a contract that ensures certain representations, warranties, or terms remain valid even after the closing.

A clause in a contract stating that the agreement binds both the original parties and their future representatives.

A type of agreement or event that must happen after the closing process. For example, a 'repurchase option' where the original owner can buy back the property in the future.

An agreement related to a main contract, but not directly tied to the property's price or title. These agreements often involve promises or representations that are separate from the core deal.

A neutral third party responsible for holding and managing documents and funds during a real estate transaction. They strictly follow the instructions outlined in the escrow agreement.

When a seller breaches a contract for the sale of land, the court will order specific enforcement of the agreement (forcing the sale to happen) unless it would cause hardship or injustice.

To establish a contractual waiver of equitable-lien rights, the contract language must be clear and unequivocal. This means the waiver must be intentional, expressed clearly, and done voluntarily.

A buyer seeking specific performance must prove they were ready, willing, and able to complete the purchase at the closing date, meaning they had the financial means and were prepared to buy.

Rescission allows a party to undo a contract by restoring both parties to their original positions before the contract was made. To do so, prompt notice of rescission is required.

A tort claim for breach of contract may be allowed if: (1) emotional distress is a reasonable outcome of the breach, and (2) the breach involves a tortious act (like fraud) or personal injury.

A lis pendens is a public notice filed with the court that signals a pending lawsuit involving a specific property. It serves as a warning to potential buyers and prevents certain property transfers.

For a lis pendens to be valid, there must be a direct connection (relationship) between the claimant and the: (1) title, (2) possession, or (3) use and enjoyment of the property.

Example of a lis pendens: A lawsuit to enforce specific performance of a stock purchase agreement for a building.

A legal process where a property owner can register their title with the government, providing a clear and official record of ownership.

A law in Minnesota that presumes any unrecorded property interest older than 40 years is abandoned and unenforceable.

A legal principle where a property owner can lose their rights to their property if they don't record their claim within a certain period.

Any private restrictions on property use, like easements or covenants, that aren't recorded or used for 30 years, automatically expire.

A legal right that allows someone to use another person's property for a specific purpose.

A specific type of easement that grants the right to travel across someone else's property.

A legal principle where a landowner can regain ownership of their property if the conditions of a deed are no longer met.

A legal right to use someone's property for a specific purpose, acquired through continuous and open use for a set period of time.

A type of lease where the tenant pays base rent plus expenses such as property taxes, insurance, and maintenance. It essentially means the tenant takes on most of the financial responsibility associated with the property.

The rate of return an investor expects to earn on a property based on its net income. It's calculated by dividing the net operating income (NOI) by the property's purchase price.

A financing mechanism where the buyer makes installment payments to the seller, but doesn't receive full ownership until the payments are complete. If the buyer defaults, they can forfeit their interest in the property.

The right of a buyer who defaults on a land installment contract to reclaim their property by paying back the missed payments and any associated fees within a specified timeframe.

A financial device used in real estate transactions where the buyer assumes a pre-existing debt, often involving a creditor-debtor relationship. It can be used for various purposes, including financing the purchase of a property.

A property description that uniquely identifies one specific parcel of land, excluding all others. To be valid, the boundaries should be clear on the ground, and it should be possible to tell where the property begins and ends.

A system used in 30 states, including Minnesota, to describe land parcels using a grid system. It offers clear identification, easy comprehension, and simple subdivisions. Each square mile is divided into sections, and each section can be further divided into smaller parcels.

A method of property description that uses measurements and directions to define boundaries. It starts at a specific point and involves a series of courses and distances to reach each corner, often using terms like 'north' and 'south' and measurements in feet or meters.

When a property description is unclear or ambiguous, courts might allow the use of additional evidence to clarify the intended meaning. This evidence could include prior agreements, surveys, or even witness testimonies.

An abstract is a compilation of all official records related to a property, tracing its ownership history and any encumbrances. It provides a summarized history of the property's legal documentation.

This type of insurance protects a property buyer or lender from financial losses arising from defects in the title, such as hidden liens, ownership disputes, or forgery. It's a type of financial safeguard.

A legal opinion provided by an attorney regarding the validity and marketability of a property's title. It identifies potential defects or clouds on the title that might concern a buyer or lender.

When a legal document, such as a deed, is ambiguous, courts may rely on physical markers or monuments placed on the land to determine the true boundaries. Original survey monuments hold more weight than written descriptions.