Legal Question in Real Estate Law in Oregon
property
I purchase a piece of propertyand closed with title insurance based on the property description. The previous owner had agreed with the neighbor that they have established a property line by agreement. This agreement completely changes our property line description and leaves us with less property than we purchased. I found out about this after sale closed. The previous owner disclosed that he purchased the property based on description but did not know exactly where the boundary line was. I went to trial and the judge found that there was a previous agreement . With this decision I am left with about 1/4 of the land I thought I was buying. Does title insurance cover my loss or am i just sol? or is the sale even valid because what thought i purchased does not exist.
1 Answer from Attorneys
Re: property
If your description of the situation is accurate, you should appeal the court order awarding most of the property to the neighbor. In order for a property transaction to be valid against a subsequent purchaser of the property for value (and without notice of the prior alleged transaction), the transaction must be recorded in the county property records. That is what the title insurance company searches. If you bought a piece of property, and the previous alleged transaction had not been recorded, then you are the legal owner of the fulll property that you bought, as soon as you do record your transactions.
The title insurance company insures you that there have been no recorded transactions that divest the owner of the property he is trying to sell you. Since, as you say, this previous transaction was not recorded, then the title insurance company is not liable to you for the difference.
As for the neighbor and the seller, the neighbor may have a cause of action against the seller to get his/her money back from the seller.
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