January 11, 2008 Washington REALTORS® Friday Facts Legal Q&A -------------------------------------------------------------------------------- Question: Broker is fully aware that without a complete and accurate legal description, a purchase agreement is void. Broker is also aware that in order to facilitate the attachment of a complete and accurate legal description, the statewide form provides for the attachment of Ex. A as the legal description. It was taught in the forms classes that the Ex. A legal description should be the Exhibit A to a preliminary title report. However, in broker's community, several title companies have begun to provide agents with a legal description labeled as Ex. A and bearing the statement that, in essence, the legal description is not the product of any research and is not reliable. In other words, the Ex. A is not an attachment to a preliminary commitment. Rather, it is a legal description printed out by the customer service department of the title company with the words "Ex. A" typed across the top. Is that sufficient to create a binding purchase agreement? Answer: If listing and selling agent are lucky, that legal description will be sufficient, but it is certainly not reliable and it is not the quality of legal description that REALTORS should be demanding from a title company. REALTORS should expect that title companies are going to do the research necessary to provide listing agents and sellers with a reliable document accounting for the quality of title to the property and a complete and accurate legal description. That is what a preliminary commitment for title does.

The purpose of forcing agents to attach Ex. A as the legal description instead of handwriting a legal description was to create a situation where listing agents routinely order preliminary commitments for title upfront and are sure of the quality of title and the complete and accurate legal description BEFORE a buyer comes along. The purpose was not simply to have an unreliable legal description that bears the title "Ex. A". Our courts have made it entirely clear that if a purchase agreement does not include a complete and accurate legal description, the purchase agreement is void. The last recorded deed is not a reliably complete and accurate legal description because it is entirely possible that the legal description of the property changed since the recording of the last deed. The seller may have performed a boundary line adjustment or the legal description could have been affected by a quiet title action. There are any number of reasons that a legal description can change over time and that is why the title company includes a disclaimer on these unresearched legal descriptions putting the agent and parties on notice that the legal description is not reliable. To use a legal description that the title company deems unreliable is setting buyer and seller up for a potentially void transaction. Listing agents need to order preliminary commitments at the time they take a listing, pay a cancellation fee if that is necessary to secure the preliminary commitment and have a reliably complete and accurate legal description to attach to a purchase agreement. Hotline Attorney Annie Fitzsimmons writes the Legal Hotline Question and Answer of the Week. Please submit questions to legalhotline@warealtor.org or call (800) 562- 6027. Please have your NRDS number ready when you call or e- mail the Hotline with your question. The Legal Hotline lawyer does not represent Washington Association of REALTORS® members or their clients and customers.