The Length of a Deed’s Warranty May Vary
Most people have the general idea that by transferring a home with a warranty deed, a seller makes binding promises to a buyer. But what do most of us know about those promises — unless and until something goes wrong later, and legal action is contemplated?
A warranty deed offers its recipient significant assurances. It’s good to know what promises the seller is making, and how long they cover the buyer. These promises, called covenants, assert that the seller has the legal right to sell, that the title is good, and, in certain cases, that the seller is willing to defend the title against future challenges.
To lay this out clearly, a warranty deed is a seller’s promise that:
- The seller owns the property to be conveyed.
- The seller has full rights to convey title to a new owner.
- The title is clear.
- The seller agrees to “warrant and forever defend” the title being conveyed.
Note: State law where a property is located sets forth the language through which deeds convey titles. Owners can check the deed language in the state where the property is located for the words “warrant and forever defend” or similar terminology.
Wait a Minute. “Forever Defend”?
Can the buyer enforce warranty covenants if there is some kind of title problem after the sale? For how long? Is there a statute of limitations that frees the seller from legal obligations at some point?
Obviously, it matters to the seller how far these assurances really go. In Lloyd v. Estate of Robbins (2010), this very question was brought to the Maine Supreme Judicial Court. The question, which involved a boundary dispute, happened according to the following timeline:
2000: The Lloyds received a warranty deed for land in Southwest Harbor, Maine. After the sale, the owners of the land next door successfully sued the Lloyds, claiming to hold title to a large part of the land described on the Lloyds’ deed.
2008: The Lloyds then sued the previous title holder, alleging unjust enrichment and several breaches of warranty covenants, including the covenant of the right to convey the property.
Given that eight years had gone by since the sale, a key question was whether the statute of limitations had kicked in to protect that earlier owner.
The Lloyds argued that the deed’s language, and Maine’s deed law, creates warranty obligations that last forever. On the deed, as in Maine’s law, a party conveying a warranty deed promises to defend the new owner and even the new owner’s heirs against lawful claims — “forever.”
The court disagreed. It said the “forever” language isn’t describing the length of time over which the seller must “warrant and defend” but rather refers to the time over which the property is conveyed.
Then the court looked to Maine’s standard six-year statute of limitations, and applied it to the warranty deed at issue.
Signed, Sealed, Delivered: Buyer Gets Longer Effective Warranty “Under Seal”
The court noted that the Lloyds could have used a 20-year statute of limitations were the deed “under seal.” There was no formal seal (essentially a recitation of legal words) from the seller, though.
Traditional deeds all were “under seal” until that custom changed. Yet buyers can still ask to receive contracts “under seal” for real estate transaction. This simply means the document is signed, has a seal, and is delivered.
Is this complicated? Do the parties need to heat wax or attach ribbons? No; just including the word “seal” beside the signature is considered enough. There’s no need for sealing wax or actual sealing. The word itself would create a presumption in court that it was a contract under seal. A court would consider the parties’ intent, when including the word — and it appears that the judge in the Lloyd case would have accepted it.
“The inclusion of seal recitals could become an interesting negotiation point,” the law firm Petruccelli, Martin & Haddow, LLP has noted, “between buyers and sellers of residential real estate.”
We’ve noted that a printed document can be both signed and sealed. But what about electronic documents? Can they be signed, sealed, and delivered?
According to Jan Willem Möller of the Tanner De Witt law firm, the process is often done electronically — “preferably on the basis of a clause in the instrument explicitly allowing for this” — with the signed documents scanned, “and a compiled fully executed PDF copy between the parties by email – so no need to travel unless you are in need of a printer or a pen (or an internet connection).”
Today, online forms may offer “seal” language in their templates. After the signatures and in the notary’s acknowledgement, look for this language:
On this ___day of ________, before me, the subscriber personally appeared…acknowledged under oath, to my satisfaction, that this [each] person signed, sealed and delivered this document…
That’s a flag that a party to the agreement has 20 years to sue to enforce its terms.
The same concept applies to other real estate documents, too. Imagine a person buys a home in Pennsylvania and signs a mortgage agreement under seal, and defaults on the loan. Five years later the lender forecloses. Normally, the Pennsylvania statute of limitations has kicked in by then; it allows just four years to enforce a note. The lender would have no case. But “an action upon an instrument in writing under seal” would give the lender 20 years to file an action in court.
Finer Points: Present and Future Covenants
Note that the period of years for a statute of limitations don’t begin running at the same time for all kinds of warranty covenants. There are:
- The present covenants of a general warranty deed. The seller makes present promises, such as claiming to have full possession and rights to convey the parcel. The valid period for present covenants begins to run at purchase. The Lloyds were barred by the statute of limitations from suing more than six years after purchase, Maine’s standard statute of limitations.
- The future covenants of a general warranty deed. The concept that a seller would defend the buyer against later claims is a future covenant. For future covenants, the statute of limitations only starts when the issue arises (when the “possession and enjoyment” of property is challenged). This could trace back to the purchase date or to some later point. When did the neighbors’ claim to the contested area begin? The court would have to know, in order to decide when the clock started running for future covenants. As the case wound on, the statute of limitations for “possession and enjoyment” differed from the purchase date, and so was found not to have expired when the Lloyds filed their complaint.
As you can see, suing over a general warranty deed is complicated! It takes legal experience and skill to help a homeowner navigate these finer points, such as when a statute of limitations actually begins to run.
Important note: This article is intended as an issue-spotter, to note certain general questions that come up. It is not meant, and should not be used, as legal advice. State laws vary, as do the circumstances surrounding each deed. Speak with a real estate lawyer if you require legal advice with a land dispute, or for drafting or negotiating a contract related to real estate.
In a Nutshell: What You Must Know About Your Warranty Deed
We can offer a few general rules as takeaways:
- For the seller: By conveying a general warranty deed, you make lasting promises. Future title actions can be brought years after the sale — as many as 20 years later, if a deed is under seal.
- For the buyer: A warranty deed isn’t foolproof protection for your title. Nor do its promises protect a buyer forever. Unexpected claims can arise. This is why a title search is done before closing.
This article should help explain why many home buyers opt to purchase title insurance at closing. They are protecting themselves against title issues that could turn up any time after the purchase of real estate.
Explore more about protecting your title on Deeds.com.
Supporting References
Lloyd v. Estate of Robbins, 997 A. 2d 733 – Maine Supreme Judicial Court (2010).
Lloyd v. Estate of Robbins, 58 A. 3d 1107 – Maine Supreme Judicial Court (2012).
Petruccelli, Martin & Haddow, LLP (Portland, ME): News – Sellers Should Be Aware of Warranty Deed Covenants.
Atty. Jan Willem Möller with Tanner De Witt: Executing Contracts: Do We Really Need Pen and Paper? (Mar. 20, 2020).
Hoffmeyer & Semmelman, LLC: Documents Under “Seal”: Its Meaning and How It May Assist Your Case (Jan. 15, 2020).
Jason Gordon for TheBusinessProfessor.com: Documents Under Seal – Explained. What Are Documents Under Seal? (updated Sep. 24, 2021).
42 PA Consolidated Statutes § 5525. Four-Year Limitation.
42 PA Consolidated Statutes § 5529. Twenty-Year Limitation.
Photo credits: Kindel Media and Pavel Danilyuk, via Pexels.