Tuesday, April 22, 2008

Doctine of Equitable Conversion

Once a contract is signed and each party is entitled to specific performance, equity regards the buyer as the owner of the real property. The seller's interest - the right to the proceeds of sale - is personal property. Seller has bare legal title and thus right of possession until closing.

Risk of Loss

If property is destroyed before closing, risk of loss is on buyer. (Majority rule.) Or: risk of loss on seller unless buyer has legal title or possession at time of destruction. (Uniform Risk Act.)
Insurance: It's unjust enrichment for seller to receive insurance payment and recover purchase price from buyer. Buyer credited for insurance payment.


Deceased seller's interest passes as personal property; buyer's interest passes as real property.

No comments: