Deeds procured by fraudulent misrepresentation are voidable
A voidable deed is one that can be set aside or reformed if necessary to correct a mistake. A fraudulent deed is also voidable. See Maeberry v. Gayle, 955 S.W.2d 875 (Tex. App.—Corpus Christi 1997, no writ) (rescission of deed obtained by fraud was warranted).
However, the deed can only be set aside by filing a lawsuit requesting cancellation of the deed and a subsequent decree which annuls and cancels the deed. Meiners v. Texas Osage Co-op. Royalty Pool, Inc., 309 S.W.2d 898, 902 (Tex. Civ. App.—El Paso 1958, writ refused n.r.e.), citing Deaton v. Rush, 113 Tex. 176, 252 S.W. 1025 (Comm’n App. 1923). Those actions must come from the party with the right to void the instrument and not the party who created the deed. See Vickery v. Vickery, 42 Tex. Sup. Ct. J. 700, 1997 WL 751995 (Tex. App.—Houston [1st Dist.] 1997), review denied, 999 S.W.2d 342 (Tex. 1999).
Deeds procured by fraudulent misrepresentation are voidable—Elements of fraudulent misrepresentation
In order to file a claim of fraudulent misrepresentation, thus rendering a deed voidable, the following elements must be included: As a material matter of fact, false representation about the conveyance exists; the grantor of the deed is aware of the false representation and has intentionally misrepresented information; the grantee is unaware of the misrepresentation and has acted upon the deed based on that misrepresentation; the grantee has suffered a loss, damage, or injury as a result of the misrepresentation. Booth v. Chadwick, 154 S.W.2d 268 (Tex. Civ. App.—Galveston 1941, writ refused); see HTM Restaurants, Inc. v. Goldman, Sachs & Co., 797 S.W.2d 326 (Tex. App.—Houston [14th Dist.] 1990, writ denied) (court lists elements of fraud).
Deeds procured by fraudulent misrepresentation are voidable—Examples of fraudulently procured deeds
Misrepresentation also occurs when promises are made fraudulently, potentially resulting in a voidable deed. If a grantor creates a dead which intentionally takes advantage of the grantee’s ignorance, Texas courts state that the legality of the deed may be void. See Golson v. Capehart, 473 S.W.2d 627, 628 (Tex. Civ. App.—Eastland 1971, writ refused n.r.e.). If a person makes a promise but has no intention of keeping that promise, and a deed is created based on that promise, then the deed may be fraudulent. In the case of Williams v. Kaufman, for example, the grantee made a promise to the grantor to take care of him for the rest of his life in exchange for the deed. The grantor signed a power-of-attorney, evidence of his belief that they had a committed relationship and that the deed was not a gift. However, the grantee did not pay the $10 consideration specified in the deed, indicating that she had no intention to keep her promise to care for him for the rest of his life. As a result of her intention not to keep a promise she made, the deed was voidable. Williams v. Kaufman, 275 S.W.3d 637 (Tex. App.—Beaumont 2009, no pet.).
Deeds procured by undue influence are voidable—What constitutes undue influence
The Texas Supreme Court acknowledges the difficulty of creating a solid definition of undue influence. However, they note that “generally speaking, undue influence is such influence or dominion as exercised at the time, under the facts and circumstances of the case, which destroys the free agency of the testator, and substitutes in the place thereof the will of another…’that which compels the testator to do that which is against his will from fear, the desire of peace, or some feeling which he is unable to resist.’” When proof of undue influence is provided, a deed becomes voidable. Long v. Long, 133 Tex. 96, 125 S.W.2d 1034, 1035 (1939), mandate conformed 129 S.W.2d 1206 (Tex. Civ. App.—El Paso 1939), writ dismissed133 Tex. 623, 138 S.W.2d 798.
Deeds procured by undue influence are voidable
While deeds may also be voidable if they are signed using undue influence, the claim of undue influence must be proven and not presumed based on a party’s opportunity or interest. Hager v. Hager, 127 S.W.2d 234, 237–239 (Tex. Civ. App.—Eastland 1939, no writ), citing Pierson v. Pierson, 57 S.W.2d 633 (Tex. Civ. App.—Galveston 1933, writ refused). Instead, a claim of undue influence must be substantiated by tangible, reasonable proof that the grantor did not have free will to act on his or her own wishes as a result of the undue influence of another. The deed becomes voidable when there is proof that, without the undue influence of another, the grantor would not have executed the deed as written. Stewart v. Miller, 271 S.W. 311 (Tex. Civ. App.—Waco 1925, writ refused).
There is no presumption of undue influence or fraud when parents make a deed of gift to their children, or when parents exclude children or grandchildren. Hager v. Hager, 127 S.W.2d 234, 237–239 (Tex. Civ. App.—Eastland 1939, no writ); Andrews v. Brown, 283 S.W. 288 (Tex. Civ. App.—Austin 1926), affirmed10 S.W.2d 707 (Tex. Com. App. 1928); Shelton v. Shelton, 281 S.W. 331 (Tex. Civ. App.—Austin 1926); Lott v. Kaiser, 61 Tex. 665, 1884 WL 8844 (1884). Undue influence may be inferred, however, when the children gift their parents, based on the power differential in the relationship. Beville v. Jones, 74 Tex. 148, 11 S.W. 1128 (1889).
Deeds involving mutual mistake are voidable
When a deed contains a mutual mistake, it is possible to make a correction, or reformation, of the deed to correct the mistake. The elements for reformation are 1) possession of the original agreement and 2) a mutual mistake written into the deed which does not reflect the original agreement. Relevant, valid proof of the mutual mistake must be presented to allow for the reformation. Richmond v. Wells, 395 S.W.3d 262 (Tex. App.—Eastland 2012, no pet.); Hardy v. Bennefield, 368 S.W.3d 643 (Tex. App.—Tyler 2012, no pet.); Comiskey v. FH Partners, LLC, 373 S.W.3d 620 (Tex. App.—Houston [14th Dist.] 2012, pet. denied).
A mistake by only one of the two parties involved in a deed is not in itself reason for avoiding a deed. For example, if a grantor intends to convey one parcel of land but by mistake includes two parcels of land in the deed, the deed is not voidable. Brown v. Bradley, 259 S.W. 676 (Tex. Civ. App.—Waco 1924, no writ); Grundy v. Greene, 207 S.W. 964 (Tex. Civ. App.—Texarkana 1918), writ refused, (Mar. 19, 1919) (Tex. Civ. App.—Texarkana 1918, error refused). However, when the mistake is mutual, rescission, or undoing the contract, is possible. In order to do so, the parties must provide the original agreement and show that the contract does not accurately reflect the original agreement due to a mutual mistake. Gail v. Berry, 343 S.W.3d 520, 177 O.G.R. 520 (Tex. App.—Eastland 2011, pet. denied); Winegar v. Martin, 304 S.W.3d 661, 176 O.G.R. 776 (Tex. App.—Fort Worth 2010, no pet.); see Bright v. Johnson, 302 S.W.3d 483, 174 O.G.R. 392 (Tex. App.—Eastland 2009, no pet.) In one case, for example, the deed included a mutual mistake about the reservation of mineral rights on the property. Because the reservation of mineral rights was clearly outlined in the sales contract, and the attorney acknowledged his mistake of excluding the mineral rights, the grantors were entitled to reformation of the deed. Bright v. Johnson, 302 S.W.3d 483, 174 O.G.R. 392 (Tex. App.—Eastland 2009, no pet.). Gail v. Berry, 343 S.W.3d 520, 177 O.G.R. 520 (Tex. App.—Eastland 2011, pet. denied).
A fraudulent deed means that property cannot convey as planned. Working with a lawyer experienced in real estate helps a buyer or seller handle all the complications of a real estate transaction, ensuring that the conveyance of property goes smoothly for all parties.
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