Daily Development for Thursday, January 24, 2008
by: Patrick A. Randolph, Jr.
Elmer F. Pierson Professor of Law
UMKC School of Law
Of Counsel: Husch Blackwell Sanders
Kansas City, Missouri

DEEDS; RESCISSION: MISTAKE OF LAW:  A grantor may not rescind an executed deed, duly recorded, solely because he held a mistaken belief that the deed could be modified.

 Ward v. Ward, 874 N.E. 2d 433 (Mass. Ct. App. 2007). 

Arthur Leonard Ward (Arthur, Sr.) conveyed a house to his son (Arthur, Jr.) by executing and recording a quitclaim dead, reserving a life estate.  After Arthur, Sr.'s two daughters learned of the conveyance, Arthur Sr. asked Arthur, Jr. to deed back the property which Arthur, Jr. refused to do.  Thereafter, Arthur, Sr. executed a will devising his property to his two daughters.  Arthur, Sr. then filed an action in Superior Court to rescind the deed on the ground that he signed the deed under the mistaken assumption that he could change it. 

After a jury found that Arthur, Sr. was in fact mistaken, the Superior Court held that the deed could be rescinded based on Arthur, Sr.'s mistake, relying on cases allowing the reformation of trusts based upon a settlor's unilateral mistake. 

The appeals court rejected the trial court's reliance on trust law precedent and instead applied contract law:  Unlike trusts, contracts and deeds may only be rescinded or reformed because of mistake if the mistake is mutual to the parties.  Furthermore, a mistake of law made by one party to a contract does not give the mistaken party a right to rescind the contract.  Here, the court held, Arthur, Sr. made an erroneous conclusion as to the legal consequence of precisely what he directed his attorney to draft and therefore may not rescind the deed for that reason.  The appeals court reversed the Superior Court's judgments rescinding the deed and declaring Arthur, Sr. as fee simple titleholder.

Comment: This is pretty much hornbook law.  You can't undo the delivery you did.  Mistake of law is no excuse.  Arthur, Sr. admitted that he intended to deliver a currently valid deed (of a future interest).  That does it. 

This is a situation in which a Transfer of Death Deed statute would have been helpful.  But only, of course, if Arthur, Sr. had consulted a lawyer or otherwise learned of the device.  Typically, the editor believes, the benefits of the statute have to be invoked.  Otherwise the deed is not ambulatory. 

Comment 2:   Although, of course, recording helps, the fundamental question is whether the deed was delivered.  Recording only creates a presumption of delivery in most cases, and rarely is required in order for the deed to be valid. 

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