Understanding Deeds

Robert Moore

There are likely few documents more important to farmers than the deeds for their land. These documents may seem simple but like most things in the law they are much more complex than one might think. A deed not only shows the transfer of land from one person to another but also shows how the land is owned, what land is subject to the deed, and any restrictions placed on the land by the buyer.

When land is bought by more than one person, the buyers must decide if they will own the land as tenants in common (TIC) or joint with rights of survivorship (JWROS). TIC means that each person owns an undivided interest in the land. A person owning a TIC interest may transfer his interest to another person without the permission of the other owner. A JWROS ownership means that upon the death of one owner, the surviving owner(s) automatically receive his share. This issue becomes most important upon the death of an owner. For example, John and Bill own land together as TIC. Upon John’s death, he bequeaths his ½ ownership to his daughter Jane. Bill and Jane are now the owners of the land. If John and Bill own the land JWROS, upon John’s death his entire ½ interest automatically goes to Bill, not Jane. If a deed does not designate JWROS, the law makes the ownership TIC by default.

Dower is a very old legal concept that provides a spouse an automatic ownership interest in the other spouse’s real estate. This concept dates back to England to ensure that widows, who were not allowed to own land because they were women, were able to benefit from their deceased husband’s land. While the concept may be out of date, it nonetheless is an important concept to deal with. Dower is not limited to wives; husbands also have a dower interest. For example, Joe buys land from Rob. The land is only in Rob’s name but Rob is married to Kelly. For Joe to receive clear title on the land, Kelly must sign off her dower interest on the deed. If only Rob were to sign the deed, Joe would take title to the land with a clouded title. Dower is typically not an issue but a crafty spouse may realize the leverage his or her dower interest can have on the other spouse. Using the above example, Kelly agrees to sign off on Dower provided Rob uses some of the sale proceeds to buy her a new BMW.

There are three primary types of deeds used in Ohio: general warranty, limited warranty, and quit claim. In a general warranty deed, the seller is guaranteeing that he has clear title to the land. This guarantee extends back to the property’s origins. A limited warranty deed only guarantees that the seller had clear title while he owned the land. A quit claim deed only transfers whatever interest the seller has in the land and makes no guarantee that the seller has any interest at all. Unless its an intra-family transfer, sheriff’s sale of other similar situation, land should never be purchased with a quit claim deed.

The seller can place restrictions on the land as part of the sale. Common examples are reserving an easement for a driveway, reserving the opportunity to buy back the land if sold by the buyer, and reserving the mineral rights. The seller can make almost any restrictions he wants, provided the buyer will still buy and the restrictions do not make the land unmarketable or is not discriminatory in some way.

A person’s ownership in land cannot be transferred without their signature. A common fear is that a co-owner will sell the land without getting the permission from the other co-owner(s). All owners, no matter how small their ownership, must sign the deed to transfer the entire ownership to the buyer. An owner may have a Power of Attorney or Trustee sign on his behalf but the Power of Attorney document or an Affidavit of Trust must be recorded with the county recorder verifying that the signer does in fact have authority to do so.

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