Oral Condition on the Transfer are Disregarded when Deed is Delivered with the Intent of Divesting

McMillin v. Eare (2021) 70 Cal.App.5th 893

In McMillin, the Plaintiff, a mother, filed suit over the validity of two deeds that were delivered with oral conditions. The Plaintiff's claims included slander of title, constructive trust, declaratory relief, quiet title, and cancellation of deeds. The defendants, one of which was the Plaintiff's son, had received the deed with oral instruction to hold the deed until the son purchased the property of the mother died. The Defendant argued that the oral conditions were invalid, and that the transfer of title was immediate as soon as the deed was received.

The trial court disagreed with the Defendant. The Trial court found that the Plaintiff did not intend to make an immediate transfer of title, as noted by the conditional nature of the deed. However, the Court of Appeal reversed. It held that the grantor executes and delivers a deed the grantee with the intent of divesting title “but imposes an oral condition on the transfer, the condition is disregarded and the grantee receives title free and clear of the condition.” As such, the Court reversed the judgment of the trial court, finding that the delivery of the deed was a valid transfer of ownership, and that the oral conditions must be disregarded. (The Court did note that “If the condition does not occur, the grantor may be able to recover damages from the grantee, but the title cannot be recovered.”)

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