Title to real property must be transferred with a valid deed. When a seller of property transfers title, he professes certain promises about the property. The promises are called covenants. A general warranty deed is one type of deed, whereby certain warranties are implied with the property transfer.
A general warranty deed guarantees that the title to the property is free from any defects or encumbrances before and after the actual transfer of title. It conveys the seller's interest in the real estate property, and the implied warranties are also transferred with the deed. Moreover, if the property title has any defects, the seller can be held liable for these defects.
By transferring a general warranty deed, the seller assures the buyer of property that no other person owns the property. Therefore, the seller warrants that he is the sole owner of the property being transferred. As the sole owner of the property, the seller also promises that he has the actual authority to convey the property without any encumbrances.
Future covenants within a general warranty deed guarantees that the buyer of the property will continue to possess a secure title after the actual transfer of property. Thus, the seller represents that he has superior title to the property. Additionally, the seller warrants that the buyer will be free from any disturbances in his possession and enjoyment of the property. The covenant of further assurances assures that, if there are any defects or encumbrances attached to the property, the seller promises that he will cure any defects.
Breach of Covenants of Titles
Breaches of present covenants are any defects in title that is present at the time the deed to the property is transferred. Breaches of future covenants may occur if the buyer encounters any disturbances to his property title after the transfer of property.
If the seller transfers title to property that he does not own or transfers a title with encumbrances, such as liens, mortgages, or easements, the seller has in fact breached one or more of the present covenants. Also, a present covenant is breached, if the seller conveys an interest in property, whereby he lacks the authority to convey that interest. For instance, if the stipulations in a trust instrument prevents the seller from transferring title to the property, then the seller lacks authority to convey that interest. The future covenants assure the buyer that the seller has an obligation to defend against any other lawful claims in title. For that reason, the future covenants in a general warranty deed protect the buyer's future interest in the property.