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50. Is the deed valid?
While on vacation in Europe, the owner suffered a bad fall and was hospitalized. The prognosis for his recovery is not good, and the owner became afraid that the state of his health may prevent him from returning home, so he hired an agent to handle his business affairs in the United States. Over the phone, the owner orally gave the agent authority to promptly convey Blackacre to the neighbor in person. The agent went to the neighbor's home with the proper documents, which the agent executed. On the deed, the agent signed the owner's name.
The owner of Blackacre is an elderly, unmarried man with no children and no surviving relatives. Blackacre is a large property bordered by forests on the east side, a small stream on the west side, a large hill to the south, and a meadow to the north. There are neighbors to the east, west, and south. The owner would like to leave Blackacre to the neighbor over the hill, but has neglected to do anything about it.
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To be enforceable, the Statute of Frauds requires every deed to contain the following information:
identification of grantor and grantee;legal description of the property being conveyed;words indicating that the deed is a conveyance (rather than some other type of instrument); ANDsignature of the party to be bound (i.e., the person or entity conveying the property).As deeds do not require much information, the document itself is often very short. However, the document may also contain additional information, such as the conditions or assurances that accompany the transfer. Each deed must also be validly delivered to the individual taking ownership of the property. In most situations, it should also be filed with the appropriate authority as well.
Every real property transfer will require the use of some type of deed. It is important to use the legal description of the property for the deed so that it may be recorded accurately.
The Equal Dignities Rule refers to a legal doctrine requiring an agent to perform all acts authorized by a principal. An agent can perform those acts only if the agent's authority is set forth in writing. Equal Dignities Rule is essentially a corollary to the Statute of Frauds. Under this rule, a contract would be unenforceable unless reduced to writing. For example, for those contracts subject to the Statute of Frauds, the authority to enter into such a contract must also be in writing. However, under the Equal Dignities Rule, an agent cannot usually estop his or her principal by conduct alone.
C is correct. Under the Equal Dignities Rule, when the act performed by an agent is required by law to be in writing, the agent's authority must also be in writing. A deed is an instrument that is subject to the Statute of Frauds and must, by law, be in writing to be valid. Therefore, an agent signing a deed on behalf of a principal must have his or her authority to sign the deed in writing also.
In this case, the agent was only given authority orally, over the phone. Therefore, the deed is not valid because the agent did not have written authority to sign for the owner. The agent's authority is valid if he signs the deed in the presence of the grantor. If the agent signs outside the presence of the grantor, then the Statute of Frauds applies.
A is incorrect. As stated above, the agent needed written authority to execute the deed but only had oral authority, so the deed will be invalid.
B is incorrect. The agent did not have the proper written authority. However, if the agent would have had proper authority, it is correct that he should sign the owner's name and not his own. According to the Equal Dignities Rule, an agent can perform all acts if the agent's authority is set out in writing.
D is incorrect. A non-attorney may execute a deed if they have the proper authorized authority to do so. The agent need only be laid out in writing.