[WSBARP] Possibility of Reverter

Tue Jan 31 14:28:21 PST 2017

Thanks for the responses.  

John, the title company is simply excepting the document in Schedule B.  They haven’t raised any particular concern.

Eric, yes, that was the conclusion I came to and the court’s opinion in Rob’s case seems to be receptive to the argument that a deed restriction like the one I’m faced with is an unreasonable restraint on alienation (not limited in scope or time, no legitimate interests are apparent at this point some 80 years later, and consequences of enforcement would be massive).

Gregory, yes, I was thinking a quiet title action would work great if no heirs can be found but was not at all confident if they could  I’m glad to hear you’ve had some luck with this approach because with a property this valuable I was afraid alerting long lost heirs to the issue would lead to them demanding an unreasonable amount to release their interest.   

Roger, I did get check with another title company and they would except it as well.

Rob, thanks for passing along the court’s opinion from your case.    

Marc Holmes

Holmes Law Group PLLC

808 5th Ave N

Seattle WA 98109

HolmesLawGroup.com <http://holmeslawgroup.com/> 

marc at holmeslawgroup.com

Ofc: 206-357-4224

Cell: 206-849-0853

From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of John McCrady
Sent: Tuesday, January 31, 2017 9:01 AM
To: WSBA Real Property Listserv
Subject: Re: [WSBARP] Possibility of Reverter

In the fact situation given, I would continue to show the matter.  I don’t want to pay the cost of a determination that the restriction has been abandoned, etc.  

I am curious whether the title company is worried that a use by the current owners has triggered the reverter?  It sounds like they are not worried about a reverter already having taken place, but are only continuing to show the restriction?

John McCrady

Counsel

Puget Sound Title Company

5350 Orchard Street West

University Place WA 98466

253-476-5721

From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Roger Hawkes
Sent: Monday, January 30, 2017 6:21 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Possibility of Reverter

Well doneJ a big difference from current query and your case is the grantor was still alive in your case; although a reservation could be crafted to protect future generations too.  I am curious to know what the title insurer gurus say about this.

Roger Hawkes, WSBA 5173

19909 Ballinger Way NE

Shoreline, WA 98155

www.hawkeslawfirm.com <http://www.hawkeslawfirm.com/> 

206 367 5000 voice

206 367 4005  fax

From: Rowley, Rob [mailto:rob at rowleylegal.com] 
Sent: Monday, January 30, 2017 4:59 PM
To: WSBA Real Property Listserv
Subject: Re: [WSBARP] Possibility of Reverter

My one case that I got to argue at the Supreme Court dealt with the enforceability of fee simple determinable estates.

Alby v Banc One (2006)

https://scholar.google.com/scholar_case?case=6610484979493170052 <https://scholar.google.com/scholar_case?case=6610484979493170052&hl=en&as_sdt=6&as_vis=1&oi=scholarr> &hl=en&as_sdt=6&as_vis=1&oi=scholarr

On Mon, Jan 30, 2017 at 4:36 PM, Roger Hawkes <Roger at law-hawks.com> wrote:

Egads!!  Picking nits by title insurer.

I would seek other insurer’s inputs; failing a change, then advise Buyer that it probably will impact a future sale or pledge by them; they can do a quiet title action, of course; and have the Sellers pay for cleaning it up?

Roger Hawkes, WSBA 5173

19909 Ballinger Way NE

Shoreline, WA 98155

www.hawkeslawfirm.com <http://www.hawkeslawfirm.com/> 

206 367 5000 voice

206 367 4005  fax

From: Marc Holmes [mailto:marc at holmeslawgroup.com] 
Sent: Monday, January 30, 2017 4:22 PM
To: 'WSBA Real Property Listserv'
Subject: [WSBARP] Possibility of Reverter

Mates,

I have a client purchasing a single family home and an old deed showed up on title with a restriction against “carrying on a trade or business” on the property or else the property “immediately reverts to the grantors” who are long since dead.  I’ve been to the property and there is nothing there to suggest it’s been used for anything but a typical residence since the house was built in the 90s and the current owners have owned for more than 10 years.  However, they have registered two LLCs to using this property’s address.  When asked they said they have never operated a business on the property and that the LLCs are holding companies they own for two completely unrelated multifamily properties run by an outside property manager.  On the advice of their real estate agent, they signed and notarized a written statement to that effect.  

The sellers will be conveying by warranty deed and the title company is excepting the old deed from title policy.  Whether the old deed was sufficient to create a defeasible fee is debatable but assuming that it was, what more, if anything, should I do to look out for the buyers’ interest?   

Marc Holmes

Holmes Law Group PLLC

808 5th Ave N

Seattle WA 98109

HolmesLawGroup.com <http://holmeslawgroup.com/> 

marc at holmeslawgroup.com

Ofc: 206-357-4224

Cell: 206-849-0853

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T: (509) 252-5074

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E: rob at rowleylegal.com

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Practice concentrated on business, real estate and general legal matters in Washington and Idaho.

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