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WEEK 13 - Lecture Date Monday Nov.15th 1 Property Law...

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Lecture Date: Monday, Nov.15 th 1. Property Law Acquiring Property a.i. Warranties of Fitness Property a.i.1. General rule in conveyance of real property is caveat emptor (buyer beware) a.i.1.a. It is the buyers responsibility to know what the quality of the property is. a.i.1.b. It s on the buyer to bring an inspector to make sure the property is up to par a.i.2. Exceptions: a.i.2.a. Fraud or concealment by seller a.i.2.a.i. How can you make a realistic evaluation of the property balue if the seller has life to you? Or hidden any damages to it? a.i.2.a.ii. If you can show graud or concealment, that is an exception to caveat emptor a.i.2.b. Purchase offer condition disclosure requirement a.i.2.b.i. If there are contingencies in the purchase offer that are not met, that will resolve the problems in the buyers favor a.i.2.b.ii. Example: an assurance that the well water is not contaminated. If this is put in the purchase offer then if the well was is contaminated the buyer can prevail a.i.2.c. Property condition disclosure requirement a.i.2.c.i. N.Y Real Property Law Atricle 14 (end of course packet) a.i.2.c.ii. Property condition disclosure staement must be provided to buyer by seller (reqd by NY law) This is a form, similar to a checklist a.i.2.c.ii.1. Not a warranty document a.i.2.c.ii.2. Only have to disclose what you know a.i.2.c.ii.3. Knowing false statement makes seller liable to buyer for $300 under statute but also provides evidence for breach of contract action. a.i.2.d. Housing merchant implied warranty a.i.2.d.i. Usually only applied to new residential construction a.i.2.d.i.1. If somebody builds a house that you then purchase, they make a
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promise that they will fix if certain thins are wrong a.i.2.d.ii. See New York Business Law Article 36-b a.i.2.d.ii.1. Faulty workmanship – 1 or 2 year warranty a.i.2.d.ii.2. Major structural defects – 6 year warranty a.i.2.d.iii. Hypothetical: what happens if someone buys a property and then flips it? What if you buy from someone who purchased as an investment property and resold it? Would the warranty apply to them? YES 2. When recording is NOT effective a. If someone other than grantor is in possession, purchaser has duty to determine what that parties interest may be. a.i. This is when the person who owns the deed is not the one actually living in the property. What is the right of the party actually living there, but without a deed? a.ii. Example: you rent a house and I recorded a deed and someone wants to buy the house from me. They need to ascertain what your rights are (the person renting). What if you are occupying and you have a lease with an option to purchase? ,aybe the person renting had actually exercised the option and the person who owned the property resold it and ran away. In this case, even though the person renting did not record the property, they will likely prevail and have better ttle than the later purchaser.
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