Our law firm routinely receives calls from prospective clients wanting a quitclaim deed (often mispronounced "quick claim deed") prepared. The volume of calls we receive is so astonishing that I am convinced there must be some urban myth that leads the general public to believe a quitclaim deed is the solution for every type of real property transfer. The truth is that quitclaim deeds are almost never a good idea in Texas.
Every Texas lawyer learned in law school that a quitclaim deed does have some legal effect of passing title. The grantor in a quitclaim deed essentially grants whatever interest he or she has in the property without making warranty that they have any interest at all. Many courts have attempted to clarify what exactly a quitclaim deed is or does.
"A quitclaim deed conveys any title, interest, or claim of the grantor in the real property, but it does not profess that the title is valid nor does it contain any warranty or covenants of title. Thus, a quitclaim deed does not establish title in the person holding the deed, but merely passes whatever interest the grantor has in the property." Diversified, Inc. v. Hall, 23 S.W.3d 403 (Tex. App.--Houston [1st Dist.] 2000, pet. denied).
For practical attorneys that draft a large number of deeds a year, it only matters that a quitclaim deed contains no warranty. A typical warranty deed in Texas contains the following conveyance clause: "Grantor, for the Consideration and subject to the Reservations from Conveyance and the Exceptions to Conveyance and Warranty, grants, and conveys to Grantee the Property, together with all and singular the rights and appurtenances thereto in any way belonging, to have and to hold it to Grantee and Grantee's heirs, successors, and assigns forever. Grantor binds Grantor and Grantor's heirs and successors to warrant and forever defend all and singular the Property to Grantee and Grantee's heirs, successors, and assigns against every person whomsoever lawfully claiming or to claim the same or any part thereof, except as to the Reservations from Conveyance and the Exceptions to Conveyance and Warranty." Note that the grantor is actually conveying the property unconditionally and making warranty for this conveyance.
Because of the lack of warranty and unconditional conveyance language, title companies will not insure title if there are quitclaim deeds found in the chain of title. Title companies will require that each quitclaim deed be replaced with a warranty deed--a task that may be impossible if grantors are deceased or unable to be found. Without being able to obtain title insurance, the value of a property will be severely diminished or practically unable to be sold to a typical purchaser using financing to buy a property. As such, it is prudent to use a competent real estate attorney to prepare a warranty deed when transferring title.
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