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26. Who has title to the land?
An uncle was the record title holder of a vacant tract of land. He often told friends that he would leave the land to his nephew in his will. The nephew knew of these conversations. Prior to the uncle's death, the nephew conveyed the land by warranty deed to a woman for $10,000. She did not conduct a title search of the land before she accepted the deed from the nephew. She promptly and properly recorded her deed. Last month, the uncle died, leaving the land to the nephew in his duly probated will. Both the nephew and the woman now claim ownership of the land. The nephew has offered to return the $10,000 to the woman.
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A is incorrect. The fact that the uncle was the owner of record on the date of transfer to the woman would be relevant in a dispute between the uncle and the woman, but is not relevant in a dispute between the nephew and the woman. In fact, the woman owns the land because the nephew will be estopped from claiming ownership of the land upon the death of his uncle.
B is incorrect. The woman does not have a duty to conduct a title search, although she would be charged with the notice that such a search would provide. In this case, a title search would have revealed that the uncle was the owner of record on the date of transfer, but the uncle's ownership is only relevant to a dispute between the woman and the uncle. It is not relevant in a dispute between the nephew and the woman. In fact, the woman owns the land because the nephew will be estopped from claiming ownership of the land upon the death of his uncle.
D is incorrect. This option correctly states that the woman owns the land, but misstates the reason why this is so. The woman's recording of the deed provided notice of her interest from the time of recording, but had no bearing on the validity of her claim. In this situation, estoppel by deed would apply in the woman's favor to estop the nephew from claiming ownership of the land upon the death of his uncle.