conditional assignment of land

The Ins and Outs of Land Contracts: What You Need to Know

May 3, 2023.

In this comprehensive guide to land contracts, you will learn about the definition, types and key elements of land contracts, as well as the legal requirements surrounding them. You’ll discover the benefits and limitations of using land contracts and how to draft and negotiate them effectively.

Additionally, this article delves into the consequences of defaulting on a land contract and how to handle disputes and resolutions. Lastly, we will explore the tax implications, reporting and record-keeping aspects related to land contracts.

Definition and Overview of Land Contracts

A land contract, also known as an installment land contract or a contract for deed, is a legal agreement between a buyer and a seller for the purchase of real estate property.

In this arrangement, the seller essentially finances the buyer’s purchase, and the buyer agrees to make regular payments, often monthly or quarterly, to the seller over a specific period, including interest. Once the payment terms are satisfied, the seller conveys the property’s legal title to the buyer.

Land contracts are commonly used when a buyer cannot secure traditional financing from a bank, or when the seller wants to expedite the sale, incentivize a buyer, or create a regular income stream.

Terminology and Concepts

Vendor and Vendee: In a land contract, the seller is called the vendor, while the buyer is called the vendee.

Legal Title and Equitable Title: One of the fundamental concepts in land contracts is the separation of the legal title and equitable title. The vendor retains the legal title to the property until the vendee pays the full purchase price, satisfying the terms of the land contract. The vendee acquires an equitable title, which grants them the right to use and possess the property.

Down Payment: A land contract typically requires the vendee to make a down payment which is a percentage of the total purchase price. This amount varies and is negotiable between the vendor and the vendee.

Interest Rate: The contract will specify an interest rate, which may be fixed or variable, for the vendee’s payments toward the purchase price of the property. Interest rates in land contracts are generally higher than those offered by traditional lenders, reflecting the increased risk for the vendor.

Balloon Payment: Some land contracts feature a balloon payment, which is a large, lump-sum payment due at the end of the contract term. This allows the vendee to make smaller, regular payments throughout the contract but requires them to secure alternative financing or make other arrangements to pay the remaining balance.

Forfeiture: In case the vendee defaults on their payments, the vendor has the right to terminate the contract and forfeit the vendee’s equitable title. In this case, the vendee loses any funds paid towards the property.

Benefits of Land Contracts

Flexibility: Land contracts are often more flexible than traditional mortgage agreements, allowing for customized payment terms and other arrangements that suit both the vendor and the vendee’s needs.

Availability: For buyers who have difficulty obtaining financing from traditional lenders due to factors such as a low credit score or self-employment, a land contract can provide an alternative pathway to homeownership.

Faster Closing: Land contracts can be processed more quickly than traditional mortgage loans, as they do not require lengthy mortgage application processes or approval from a financial institution.

No Prepayment Penalty: Many land contracts do not have penalties for early prepayment, allowing the vendee to pay off the balance of the contract without additional fees.

Limitations and Risks

Legal Risk: If the vendor defaults on their obligations or fails to convey the legal title after the vendee satisfies the terms of the land contract, the vendee may need to initiate legal action to protect their rights.

Financial Risk: If the vendee defaults on their payments, they risk losing their equitable title and any funds paid towards the property.

Higher Interest Rates: Interest rates in land contracts are often higher than those offered by traditional lenders, which could lead to higher overall costs for the vendee.

Balloon Payment: If the land contract contains a balloon payment, the vendee may face difficulty securing alternative financing or need to make other arrangements to pay the remaining balance.

Before entering into a land contract, both vendors and vendees should carefully assess the risks and consult with real estate professionals and legal advisors to protect their interests.

Types of Land Contracts

Land contracts, also known as land installment contracts, are a type of financing method for people who want to purchase a property without obtaining a traditional mortgage from a bank or other financial institution.

Land contracts allow the buyer to make monthly payments directly to the seller instead of a bank, with the seller essentially acting as the lender.

There are various types of land contracts, each suited for different types of property transactions. We will discuss four major types of land contracts: installment contracts, lease purchase contracts, option contracts, and contracts for deeds.

Installment Contracts

Installment contracts, also known as installment sales, are a common type of land contract. They involve a buyer and a seller agreeing on a purchase price for a property, with payment terms typically spread out over a set period. The buyer makes installment payments to the seller according to the agreed-upon terms, and upon successful completion of all payments, ownership of the property is transferred from the seller to the buyer.

Installment contracts are particularly useful for buyers who do not have enough money saved for a significant down payment or have difficulty obtaining a mortgage loan. These contracts afford the buyer time to make monthly payments, typically including interest, toward the purchase price of the property.

Essentially, they act as a form of “ rent -to-own” arrangement, with the buyer gradually building equity in the property as they make their payments.

Lease Purchase Contracts

Lease purchase contracts, also known as lease-to-own agreements or rent-to-own contracts, are similar to installment contracts in that they allow a buyer to make regular payments toward the purchase of a property. However, instead of making installment payments on the purchase price, the buyer pays rent to the seller for the property, with a portion of the rent applied toward the purchase price.

Typically, a lease purchase contract includes an option for the buyer to purchase the property at a specified price after a certain period, during which the buyer has been making rental payments. If the buyer exercises this option at the end of the lease term, the applied rental credits can be used as part or all of the down payment for the purchase.

Lease purchase contracts can be beneficial for individuals who want to “test out” living in a property before committing to purchasing it or need time to improve their financial situation to qualify for a mortgage.

Option Contracts

Option contracts grant the buyer the exclusive right to purchase a property at a specific price within a specified period, without obligating the buyer to complete the purchase. In exchange for this exclusive right, the buyer usually pays the seller a non-refundable option fee, which may be applied toward the purchase price if the buyer decides to exercise the option.

Option contracts can provide flexibility for buyers, as they allow them to secure the right to purchase a property while they decide whether they want to buy it, secure financing, or identify a suitable time to complete the transaction. If the buyer does not exercise the option to purchase within the specified time frame, the seller retains the option fee and can pursue other buyers or keep the property.

Contract for Deed

A contract for deed, also known as a land contract or an agreement for deed, is an arrangement where the buyer and seller agree upon the purchase price, down payment, interest rate, and other terms, and the buyer makes monthly payments directly to the seller for a certain period. However, unlike a traditional installment contract, the seller retains legal title to the property until the final payment is made.

In a contract for deed, the seller acts as the lender, providing financing for the buyer. Once the buyer has completed all payments according to the contract terms, the seller will transfer the property title to the buyer.

This kind of contract can be beneficial for buyers who do not qualify for a traditional mortgage, as well as for sellers who may struggle to sell their property on the open market.

Overall, land contracts can offer significant flexibility for both buyers and sellers, allowing property transactions to occur even when traditional financing methods may be unavailable.

Each type of land contract has its own unique advantages and considerations, making it essential for both parties to conduct thorough research and consult with legal and financial professionals before entering into a contract.

Key Elements of a Land Contract

A land contract, also known as a contract for deed or installment sale agreement, is a method of financing the sale of real property between a buyer and seller. It allows the buyer to make a series of payments to the seller while living on and using the property. Once the agreed-upon price is paid in full, the seller then transfers the title to the buyer.

The following are the key elements of a land contract that parties should include when drafting the agreement.

Property Information

One of the essential elements of a land contract is a detailed description of the property being sold. This generally includes the property’s address, legal description, and tax identification number.

The legal description is crucial for clearly identifying the property being conveyed and can be obtained from a title or abstract report, county records, or a survey.

In addition to the legal description, it is essential to disclose any easements, restrictions, or encumbrances on the property, as this may impact the buyer’s intended use of the land.

Seller and Buyer Information

A land contract must identify the parties involved in the transaction – the seller(s) and buyer(s). Typically, this information includes the full names of the parties and their respective addresses.

If the buyer or seller is a corporation or limited liability company, the contract should include the entity’s name and state of formation.

If there are co-buyers, it is essential to define their ownership interests – for example, as joint tenants or tenants in common.

Purchase Price and Terms

A vital aspect of a land contract is the agreed-upon purchase price for the property. This should be explicitly stated in the contract, along with other cost-related terms such as the:

• Required initial down payment (if any)
• Amount of each installment payment
• Number of installment payments
• Final balloon payment (if applicable)

These terms should clarify the total purchase price and provide a clear understanding of the payment structure for both parties.

Payment Schedule for Land Contracts

The land contract should include a payment schedule that outlines when each installment payment is due. Payments are commonly made on a monthly basis but can also be set for other intervals, such as quarterly or semi-annually, depending on the agreement between the parties.

It is also essential to state the grace period allowed for late payments and any late fees that apply if a payment is not made within that timeframe.

Interest Rate and Calculations

The contract should specify the interest rate and any terms related to interest accrual or adjustments. It is crucial to clearly state whether the interest rate is fixed or variable and, if variable, how and when it can be adjusted. Moreover, the contract should outline how the interest portion of each payment will be calculated.

Prepayment Penalty

Some land contracts contain prepayment penalties, which are fees charged to the buyer if they pay off their obligation pursuant to the land contract ahead of schedule. If a prepayment penalty is included, the contract should clearly state the fee amount and any conditions under which it applies.

Due on Sale Clause

A due-on-sale clause is a provision within the land contract that requires the buyer to pay off any remaining balance in the event of the property’s sale or transfer to a third party.

This clause protects the seller’s interests by ensuring they receive payment in full upon the property’s disposition.

Establishing an Escrow Account

Lastly, a land contract may require the establishment of an escrow account to hold funds for property tax and insurance payments.

If this is the case, the contract should outline who (buyer or seller) is responsible for maintaining the escrow account, the amounts required to be deposited into the account, the schedule for depositing funds, and any requirements for reporting or maintaining account balances.

Understanding Legal Requirements

When starting or running a business , it is essential to understand the various legal requirements that apply to your company. These legal obligations can include federal laws, state laws, and county or local ordinances. Adhering to these standards is crucial for the successful and lawful operation of your business, as failure to comply can result in penalties and other repercussions.

Adhering to Federal Laws

Federal laws apply across the entire United States and cover areas such as labor, taxation, workplace safety, and environmental regulations. Here are some essential federal laws to be aware of when operating a business:

Tax Law: The Internal Revenue Service (IRS) enforces US tax laws for both individuals and businesses. Companies are required to pay federal income taxes and obtain an Employer Identification Number (EIN). Depending on the type of business, you may also need to collect sales tax and pay employment taxes such as Social Security, Medicare, and unemployment taxes. Tax requirements and deadlines vary, so it is essential to understand your tax obligations as a business owner.

Labor Law: Federal labor law covers various aspects of worker’s rights, including minimum wage, overtime pay, and child labor protections. Two major federal labor laws include the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA). Employers must be aware of these laws to ensure they are treating their employees fairly and lawfully.

Workplace Safety and Health Regulations: The Occupational Safety and Health Administration (OSHA) enforces federal laws to ensure a safe and healthy work environment for employees. OSHA sets and enforces standards for workplace safety, including training and recordkeeping requirements. Employers must be aware of and comply with these standards to avoid penalties and maintain a safe work environment for their employees.

Environmental Regulations: The Environmental Protection Agency (EPA) enforces federal environmental regulations. These laws oversee pollution control, hazardous waste disposal, and other environmental concerns that businesses may need to address. Companies must be aware of their environmental obligations to prevent fines and ensure compliance with federal guidelines.

Complying With State Laws

In addition to federal laws, businesses must also comply with state laws. These vary by state and can include additional labor laws, tax requirements, zoning regulations, and licensing requirements. Some key areas of state law to consider when operating a business include:

State Tax Law: In addition to federal taxes, companies generally need to pay state income and sales taxes. States may also impose additional taxes, such as property taxes, franchise taxes, or business licensing fees.

Employment Laws: State labor laws can include provisions for minimum wage, overtime pay, and paid time off, which may differ from federal standards. Employers must adhere to both federal and state labor laws to ensure compliance.

Business Registration, Licensing, and Permits: State requirements for registering a business, obtaining licenses, and securing permits can vary. Businesses must research and fulfill these state obligations to operate legally within their jurisdiction.

County and Local Ordinances

Finally, businesses must comply with county and local ordinances, which can include zoning regulations, noise ordinances, and building codes. These requirements may vary depending on the location of your business and the type of commercial activities you engage in.

Some local ordinances to consider include:

Zoning Regulations: Local zoning laws dictate where businesses can operate, the type of business activities permitted, and various requirements related to land use and development. It’s essential to understand and adhere to local zoning regulations when selecting a business location and planning any construction or expansion projects.

Building Codes: Local building codes ensure that businesses adhere to structural and safety standards in the construction and maintenance of commercial spaces. These codes may include specific requirements for accessibility, fire safety, and other health and safety considerations.

Licensing and Permits: Local governments may also require business licenses and permits, such as a health department permit for restaurants or a sign permit for storefronts. Be sure to research and obtain any necessary permits to operate legally within your jurisdiction.

By understanding and adhering to federal, state, and local legal requirements, you can minimize risks and ensure that your business operates legally and smoothly.

Drafting and Negotiating Land Contracts

A land contract, also known as a contract for deed or installment sale contract, is a legally binding agreement between a seller and a buyer for the purchase of real estate property. Entering into a land contract can be an attractive option for buyers who may be unable to obtain traditional financing or for sellers who are interested in a more flexible and direct financing option.

To ensure that the land contract is fair and legally enforceable, it is important to engage in proper drafting and negotiation processes including legal representation, due diligence, negotiation, and key contractual provisions.

Getting Legal Representation

Engaging the services of a skilled real estate attorney is crucial for both buyers and sellers in land contract transactions. Real estate attorneys can provide guidance and advice throughout the entire process, from drafting to negotiating and enforcing the land contract. They will ensure that the agreements are in accordance with local and state laws, as well as protect their clients’ interests.

Legal representation can also assist in resolving any disputes that may emerge between the parties during or after the negotiation process. Moreover, a knowledgeable attorney will be able to identify and deal with potential red flags, as well as address any complications that may arise during the closing process.

Conducting Due Diligence

Conducting due diligence is an essential part of the land contract process for both the buyer and seller. It refers to the investigation and research that buyers and sellers must undertake before entering into a legally binding agreement.

For the buyer, due diligence includes researching the property’s market value and condition. They should investigate the land’s title to ensure that there are no liens or encumbrances that could impact their ownership rights.

Buyers should also review zoning and land-use regulations, as well as obtain any necessary permits or approvals required for future development.

On the other hand, sellers must conduct due diligence by researching the buyer’s ability to make the required payments. They may want to conduct background checks, verify employment, and review the buyer’s financial statements and credit history to ensure their financial stability.

Negotiating the Land Contract

Negotiating a land contract is a critical step in ensuring that both parties are satisfied with the terms and conditions of the agreement. An experienced real estate attorney can aid in this process by assisting with negotiations, offering guidance on various aspects of the contract, and helping to facilitate communication between the parties.

Considerations during negotiation may include the purchase price, the down payment, monthly payment amounts and terms, the length of the contract, and the responsibility for taxes, insurance, and maintenance.

It is important for both parties to have a clear understanding of their respective rights, responsibilities, and obligations under the land contract.

Contractual Provisions in Land Contracts

A well-crafted land contract will include essential provisions that protect both the buyer’s and the seller’s interests. Some specific clauses that may need to be addressed in a land contract are:

Description of the property: This includes the legal description of the property, as well as any improvements, fixtures or appurtenances.

Purchase price and payment terms: The agreed-upon purchase price should be clearly outlined, along with the payment structure, interest rates, and balloon payment clauses if applicable.

Responsibilities for property taxes and insurance: The contract should specify who is responsible for payment of property taxes, insurance premiums, and any routine maintenance.

Default provisions: The contract should include measures to address default situations, such as the buyer’s failure to make timely payments or the seller’s failure to maintain clear title to the property.

Right to cure default: The parties should have the right to cure their default by paying outstanding obligations or addressing the underlying issue within a specified timeframe.

Transfer of title: The contract should delineate the conditions under which the title will be transferred to the buyer, such as payment of the full purchase price or meeting other contractual requirements.

In summary, drafting and negotiating a land contract requires careful planning, attention to detail, and professional assistance to ensure that the rights and interests of both parties are protected.

By engaging the services of an experienced real estate attorney and conducting thorough due diligence, buyers and sellers can increase the likelihood of a successful and equitable land contract transaction.

Default and Remedies

Default refers to the failure of a borrower to meet their financial obligations on time, either by not paying back a loan or failing to comply with other conditions specified in a loan agreement. When default occurs, there are various remedies that can be pursued by the lender. Let’s discuss several consequences of default as well as possible remedies for each scenario.

Consequences of Defaulting on a Loan

When a borrower defaults on their loan, the lender may take action to enforce the terms of the contract and protect their interests. Some common consequences of default may include:

Damage to the borrower’s credit score: Default can have a significant negative impact on the borrower’s credit rating, making it more difficult to obtain credit in the future.

Collection efforts: The lender may engage in collection efforts, using legal means (such as lawsuits) or hiring collection agencies to collect the debt from the borrower.

Acceleration: The lender may declare the entire outstanding balance of the loan due immediately, rather than waiting for scheduled payments.

Loss of collateral: If the loan is secured by collateral, the lender may take possession of the collateral property to recover the outstanding debt.

Additional fees and charges: Late fees, interest charges, and other fees may accumulate over time, increasing the borrower’s overall debt.

Forfeiture of Possession

Forfeiture is one of the remedies available to a lender when a borrower defaults on their secured loan. Under forfeiture, the lender takes possession of the property used as collateral for the loan. This often occurs when the borrower is unable to make the required payments on the loan, whether due to financial hardship or other reasons.

Once the lender takes possession of the collateral, they may sell the property to recoup the outstanding debt. The borrower may have the right to redeem the property before the sale, by paying off the outstanding debt and any fees. However, if the property is sold, and the proceeds do not cover the entire outstanding debt, the borrower may still be liable for the remaining balance.

Foreclosure of Property

Foreclosure is another remedy available to lenders when a borrower defaults on a mortgage loan. In a foreclosure, the lender legally takes ownership of the property used as collateral for the loan.

This process typically involves a court-supervised sale of the property, with proceeds from the sale being used to repay the debt.

The lender may either foreclose judicially or nonjudicially, depending on the state’s laws and the terms of the loan agreement. Judicial foreclosure involves a court proceeding, while nonjudicial foreclosure relies on a private trustee sale without court involvement.

Once the foreclosure process is complete, the borrower loses all rights to the property. In some cases, the borrower may also be liable for a deficiency judgment if the sale proceeds do not cover the entire outstanding debt.

Reinstatement of the Loan

Reinstatement is a remedy available to borrowers who have defaulted on their loans and wish to bring the loan current. Under reinstatement, the borrower pays the outstanding missed payments, fees, and interest charges in a lump sum to the lender. This action effectively “cures” the default and allows the borrower to resume their regular loan payments.

Typically, there is a limited timeframe during which the borrower can reinstate their loan, sometimes referred to as a “right to cure” or “right to reinstate” period. This period is often provided by state law or specified in the loan agreement.

It is important for borrowers to be aware of this timeframe, as once the reinstatement period expires, the lender may proceed with other remedies, such as foreclosure.

In conclusion, default on a loan has significant consequences for both the borrower and the lender. Various remedies, such as forfeiture, foreclosure, and reinstatement, can be pursued to address these consequences.

Borrowers should strive to meet their financial obligations to avoid default, and lenders should work with borrowers to resolve issues before pursuing these remedies.

Transfer and Assignment of Land Contracts

Land contracts, also known as installment sale contracts, land installment contracts, or contracts for deed, are agreements between a seller and buyer for the purchase of real property. The seller holds the legal title to the property, while the buyer makes regular payments to the seller over time, similar to a mortgage, until the purchase price is paid in full. Upon completion of the payments, the seller transfers the legal title to the buyer.

Land contracts are commonly used for real estate transactions, especially in situations where traditional bank mortgages may not be available or desirable.

There are situations where one or both of the parties involved in a land contract may wish to transfer or assign their rights and obligations to another party. Below, we will discuss selling land contracts, partial sales and assignments, and the associated risks and benefits of transfers.

Selling a Land Contract

Selling a land contract involves the transfer of the legal title to the property, along with the remaining payment obligations from the current seller (the original owner of the property) to a new buyer. The transfer typically requires the consent of the current buyer (the person making installment payments) and may be subject to specific terms and conditions set forth in the original land contract (such as a right of first refusal).

To sell a land contract, the parties should review the original land contract terms and seek professional advice to ensure compliance with all applicable legal and tax requirements. A written assignment or transfer agreement is usually required, detailing the rights and obligations of each party, including the payment schedule, interest rate, and other associated terms.

The transfer agreement is often recorded at the local county recorder’s office, to provide public notice of the change in ownership of the land contract.

Partial Sales and Assignments of Land Contracts

In some cases, a land contract holder (the seller/original owner) may want to assign or sell only a portion of their rights and obligations under the contract. This could involve selling a specific portion of the remaining payments owed, or assigning only a percentage of the future payments to another investor.

Partial sales and assignments are more complex than complete transfers, and careful consideration should be given to the legal and tax implications. The rights and obligations assigned or sold should be outlined in detail, and the remaining rights should be addressed in both the original land contract and the assignment or transfer agreement.

If the current buyer is cooperative, partial sales or assignments can provide a valuable source of cash for the seller, potentially enabling them to invest in other real estate or business opportunities.

It is important to work with experienced professionals familiar with land contracts, tax laws, and title issues in order to properly structure and document the transaction.

Risks and Benefits of Transferring Land Contracts

Transferring or assigning a land contract comes with various risks and benefits for all parties involved.

For the original land contract seller, the benefits often include receiving a lump sum payment for the value of the land contract or sharing the risk and reward of the future payments with a new investor. The current buyer, on the other hand, does not see a direct financial benefit from the transfer but may gain a more stable and professional counterpart to work with, especially if the original seller was an individual with limited resources.

The primary risk for the original seller is the potential loss of control over the property and the future receipt of payments. If the new buyer or investor fails to fulfill their obligations, enforcing the terms of the contract may require legal remedies, which can be costly and time-consuming.

For the new buyer or investor, the risks include the potential default of the current buyer on their payment obligations, as well as any unforeseen issues with the property, such as title defects, zoning restrictions, or environmental liabilities.

Thorough due diligence, including a review of the payment history, creditworthiness of the current buyer, and research on the property itself, can help to mitigate these risks.

In conclusion, transferring or assigning a land contract is a complex transaction that involves various risks and benefits for all parties involved. Proper structuring, documentation, and due diligence are crucial to ensure a successful outcome.

It is always advisable to work with experienced professionals familiar with land contracts, tax laws, and title issues when considering transferring or assigning a land contract.

Land Contract Disputes and Resolutions

Land contract disputes are common and can arise for various reasons. These disputes typically involve matters such as purchase and sale agreements, property boundaries, easements, and adverse possession claims.

Resolving land contract disputes is essential for both parties to protect their rights and prevent potential financial and legal consequences. Dispute resolution methods, such as mediation, arbitration, and litigation, are available to handle the complexities of land contract disputes.

Let’s examine common disputes, mediation and arbitration, and litigation as dispute resolution methods.

Common Land Contract Disputes

There are several types of land contract disputes that parties may encounter:

Contract interpretation: Conflicting interpretations of the terms and conditions of the land contract may lead to disputes between the parties. This typically involves disagreements over the meaning of specific clauses, provisions, or ambiguous language within the contract.

Property boundary disputes: Boundary disputes arise when the exact location of property lines is unclear or contested. This may occur due to outdated or inaccurate surveys, conflicting legal descriptions, or encroachments by neighboring property owners.

Easement disputes: An easement is a legal right to use another person’s property for a specific purpose. Disputes may arise if there are conflicting understandings of the easement’s scope and its permitted uses, or if one party claims a prescriptive easement (an easement obtained through continuous, open, and notorious use of another’s property without the owner’s permission).

Title disputes: These disputes involve ownership claims and issues with the chain of title (the historical sequence of legal transfers of the property). Inadequate or fraudulent title searches, forgery, and undiscovered liens can lead to title disputes.

Adverse possession claims: When an individual occupies and treats another person’s property as their own for a specific statutory period without the legal owner’s permission, adverse possession disputes emerge. In some cases, the occupier may gain legal ownership of the property, depending on the jurisdiction’s laws.

Mediation and Arbitration for Dispute Resolution

Mediation and arbitration are alternative dispute resolution methods that parties may use to resolve land contract disputes without resorting to litigation. Both methods can be more affordable, efficient, and flexible alternatives to court proceedings.

Mediation: In mediation, a neutral third party (the mediator) assists the disputing parties in negotiating a settlement. The mediator helps facilitate communication, identify common interests, and propose solutions. However, the mediator cannot impose a binding agreement on the parties. Instead, the parties must voluntarily consent to any proposed settlement.

Arbitration: Arbitration is a more formal process than mediation but still less formal than litigation. The parties agree to submit their dispute to an impartial arbitrator or panel of arbitrators. The arbitrator examines the evidence presented, applies the relevant law, and issues a binding award or judgment. Arbitration decisions are typically final, with limited grounds for appeal.

Litigation as a Means of Dispute Resolution

If alternative dispute resolution methods fail, litigation may be the last resort for resolving land contract disputes. In some cases, the parties may also choose to initiate litigation from the outset if they believe it is the best approach for their specific situation.

Court proceedings: The parties involved in a land contract dispute will present their respective cases to a judge or jury in a court of appropriate jurisdiction. The court will consider the evidence submitted, hear arguments, and apply relevant laws to make a binding decision.

Appeals: If a party disagrees with the court’s judgment, they may appeal the decision to an appellate court.Appellate courts review decisions made by lower courts for any legal errors, such as misinterpretation of the law or procedural mistakes. However, the appellate courts typically will not re-evaluate the facts of the case or overturn the lower court’s decision based on mere disagreement with the outcome.

Resolving land contract disputes can be a complicated and arduous process. The parties involved should consider consult legal professionals to guide them through the various options available and determine the most suitable dispute resolution method for their specific situation.

Taxes and Recordkeeping

Tax compliance and recordkeeping are essential responsibilities for individuals, households, and business entities. A failure to maintain accurate financial records or adhere to tax obligations can lead to a host of legal and financial consequences.

Let’s explore the various tax implications, income tax reporting, property tax responsibilities, and the need for keeping accurate records.

Various Tax Implications of Recordkeeping

There are several types of taxes imposed on individuals and business entities at various levels, including federal, state, and local taxes. Depending on the individual’s circumstances or the nature of the business, one may be subject to income tax, property tax, sales tax, payroll tax, and many others.

Income tax is a percentage levied on income earned by individuals and businesses. It is the primary source of revenue for the federal government and is used to fund public services and infrastructure. Income tax rates vary according to income levels, filing status, and other factors.

Property tax is assessed on real property, such as land, buildings, and other fixed assets. It is usually administered at the local level, with rates varying by jurisdiction. Property tax helps fund local services, such as public schools, law enforcement, and emergency services.

Sales tax is imposed on sales of goods and some services. It is collected by retailers and remitted to the state or local government. Some jurisdictions also impose use tax on goods purchased from out-of-state retailers.

Payroll tax is a tax on wages, salaries, and other forms of compensation paid to employees. It is generally split between employers and employees and is used to fund social insurance programs, such as Social Security and Medicare.

Income Tax Reporting

Income tax reporting is the process of preparing and filing an annual tax return, which details an individual’s or business’s income, deductions, credits, and tax liability. In the United States, the Internal Revenue Service (IRS) is the primary agency tasked with administering income tax.

There are different filing requirements and tax forms for individuals, businesses, and other entities like estates and trusts. For most individuals, the deadline for filing an annual income tax return is April 15.

When filing their tax returns, taxpayers must report all taxable income, including wages, salaries, interest, dividends, and capital gains. Taxpayers can also claim deductions and credits to reduce their taxable income and overall tax burden.

Deductions may include mortgage interest, state and local taxes, charitable contributions, and unreimbursed business expenses. Credits directly reduce the amount of tax owed and may include the Child Tax Credit, Earned Income Tax Credit, and education-related tax credits.

Property Tax Responsibilities of Property Owners

Property tax is imposed by local governments and paid by property owners. Taxing jurisdictions, such as cities, counties, and school districts, determine the tax rates and assessed property values. Tax rates can vary widely by jurisdiction, and assessments are typically based on a percentage of the property’s market value.

Property owners must pay property tax on a recurring basis, typically annually or semi-annually. Failure to pay property taxes can result in penalties, interest, and ultimately the loss of the property through tax foreclosure or tax lien sales.

It is essential to stay informed about local property tax laws and the assessment and appeal process. If a property owner believes that their property has been over-assessed or incorrectly classified, they may have the right to appeal the valuation, which can result in a reduction in taxes.

Keeping Accurate Records and Documentation

Accurate recordkeeping is critical to comply with tax laws and minimize the risk of audits, financial penalties, and legal issues. Taxpayers should maintain records of all income, expenses, deductions, and credits, as well as any supporting documentation, such as receipts, invoices, canceled checks, and bank statements.

For businesses, maintaining proper financial records includes tracking income and expenses, recording transactions, and retaining supporting documentation. It also involves maintaining and storing accurate employee records, payroll, and benefits information.

Keeping accurate records can help taxpayers and businesses comply with tax laws, prepare financial statements, monitor their financial progress, and manage cash flow. It can also help in preparing and filing accurate tax returns, substantiating claims for deductions and credits, and resolving disputes with tax authorities.

In summary, understanding the different types of taxes, complying with income tax reporting requirements, fulfilling property tax responsibilities, and maintaining accurate financial records are crucial for individuals and businesses alike.

Proper tax compliance and recordkeeping are necessary to avoid legal and financial problems and ensure a smooth and successful tax filing process.

Land Contracts FAQs

What is a land contract and how does it work.

A land contract, also known as a contract for deed or installment sale agreement, is a financing method used for purchasing real estate. The seller finances the sale and retains legal title, while the buyer takes possession and makes payments. Transfer of the title occurs after the buyer pays the agreed-upon amount (Molinsky, 2014).

Are land contracts a good alternative to traditional mortgages?

Land contracts can be a viable alternative for buyers who cannot secure a traditional mortgage. It allows them to purchase property without involving a bank or other lending institution. However, the buyer should carefully review the terms and ensure they can make the required payments before entering into the agreement (MacLaurin, 2016).

What are the risks and benefits of a land contract for buyers?

Benefits for buyers include easier qualification, potentially lower closing costs, and fewer origination fees. Risks involve the possibility of default, resulting in loss of investment and property, and the seller not holding a clear title or failing to make mortgage payments themselves (MacLaurin, 2016).

What are the risks and benefits of a land contract for sellers?

Benefits for sellers include a potentially faster sale, retaining the title as collateral, and earning interest on the loan balance. Risks involve the need to repossess the property in case of buyer default, which may involve legal action, and a lack of immediate lump-sum payment (Molinsky, 2014).

Can a land contract be refinanced or modified?

Yes, a land contract can be refinanced or modified through mutual agreement between the buyer and seller. In many cases, a buyer may seek to refinance through a traditional bank loan, allowing them to obtain the title and pay off the remaining balance with the seller directly (Federman, 2012).

What happens if the buyer defaults on a land contract?

If the buyer defaults on a land contract, the seller may repossess the property, usually through a process called forfeiture. Depending on the terms of the contract and state laws, the buyer may lose all rights to the property and any equity built up during the contract term (Molinsky, 2014).

References: Federman, M. (2012). Seller-financing restrictions under Dodd-Frank. Probate & Property, 26(1), 1–3. MacLaurin, J. A. (2016). Installment land contracts: The pitfalls for homeowners. Probate & Property, 30(4), 1–4. Molinsky, A. (2014). Homeownership in the United States: A primer on government-supported single-family mortgage finance. Probate & Property, 28(6), 1–5.

About the Author

Carlos Reyes

As a native Washingtonian, Carlos Reyes’ journey in the real estate industry began more than 15 years ago when he started an online real estate company. Since then, he’s helped more than 700 individuals and families as a real estate broker achieve their real estate goals across Virginia, Maryland and Washington, DC. Carlos now helps real estate agents grow their business by teaching business fundamentals, execution, and leadership.

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• G.O.Ms.No.581, Revenue Department, Dated: 03.04.1987 pdf
• G.O.Ms.No.921, Revenue Department, Dated: 15.06.1981 pdf
• TamilNadu Civil services (Compassionate Grounds) Rules, 2023 pdf
• G.O.Ms.no.461, Revenue Department, Dated: 25.03.1987 pdf
• G.O.Ms.no.35, Revenue Department, Dated: 19.01.2023 pdf

People Should Know about Law

Revenue Standing Order 15 (40) ST Condition land

வருவாய் நிலை ஆணை எண் 15 (40) – பழங்குடியினருக்கு வழங்கப்படும் நிபந்தனை பட்டா, rso 15 (40) – hill tribes – conditional assignment.

                             In the following cases the assignment of land to Mlayalis or Sholagas, as the case may be, shall be subject to the conditions that the land shall not be transferred by the assignees to any person outside the class to which they belong without the express sanction of the Divisional Officer, and that, if the land is transferred without such sanction  or is attached and sold by any legal process, it shall be liable to resumption by the Divisional Officer without payment of any compensation whatever.

• Village green assigned to Malayalis on the Shevaroys
• Land assigned to Malayalis:

1.the Tenmalai hills in the Thiruvannamalai District.

2.the Jarugumalai hills in the Salem taluk, Salem District.

3.the Chitteri hills in the uttangarai taluk, Dharmapuri District excluding the villages of Ammapalayam and Kullapatti.

4.the Arunuttumalai hills in the Salem taluk and Bodamalai hills in Salem and Rasipuram taluk, Namakkal District.

5.the Village kil Avarai on the Peria Kalrayans in the Attur taluk, Salem District.

6. the undermentioned villages on and near the Pachamalais and the Kollihills in the Attur taluk, Salem District.

                                                1.Pachamalai Hills

          1. Pachamalai taraf

          2. The surveyed hamlets of Valasaikallipatti and vippantatai in the Krishnapuram taraf.

          3. The surveyed hamelts of velur (known as karattur) and Manmalai (Second bit) in the Gudakalai taraf.

          4. Manmalai (First bit) taraf excluding Modukkupatti village.

                                                2.KolliMalai Hills

          5.Hamlets of Pilliarmathi, Saradimoolai and Kallipatti in Valacombai taraf

          6. Palttur taraf.

          7. the villages of Kombai, Tembaranadu and Vennadu on the Pachamalais in the Musiri taluk, Thiruchirappalli District and..

          8.The Undermentioned nads and villages on the Kollimalais in the Namakkal and Rasipuram taluks, Namakkal District,

                                       I. Namakkal Taluk

          1. Valavandi Nad                      8. Kunduni Nadu taraf

          2.Valapur Nadu                         9. Alattur Nadu taraf

          3.Gundur Nadu                        10. Tirupulli Nadu taraf

          4.Tinnanur Nadu                      11.Edapalli Nadu taraf

          5.Ariyur Nadu                           12.Sittur Nadu taraf

          6.Devanur Nadu                       13.Pirakarai Nadu taraf

          7.Selur Nadu                            14.Bail Nadu taraf

          15.Unantangal taraf

          16. The hamlets of Malayalapatti and Kappalutu of Karukoodalpatty taraf

          17. The independently surveyed village Perunppan Solai and hamlets of PeriaKombai and pudur palapatti of Perunppan Solai taraf.

          18. The independently surveyed hamlets of Mulaikurichi and Periyakurichi of the Mullakurichi taraf.

• ← W.P.1353 of 2017 judgement dated: 20.10.2022 pdf
• முதல் பட்டதாாி சான்று இரட்டையா்களுக்கு வழங்கப்படுமா? →

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Drafting a Deed of Assignment

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Note: Want to skip the guide and go straight to the free templates? No problem - scroll to the bottom. Also note: This is not legal advice.

Introduction

A Deed of Assignment is a vital legal document used to transfer rights, interests or assets between parties. It is regularly used in business transactions, and often regarding real estate or intellectual property. A well-crafted deed of assignment can protect both sides from potential legal disputes, ensuring that everyone involved understands their obligations and responsibilities.

The Genie AI team has seen many instances where having a valid deed of assignment can make all the difference - without it businesses could be exposed to considerable risk. That’s why we offer free templates and step-by-step guides to help those wishing to draft their own deed.

When creating a Deed of Assignment it is important to take the specific circumstances into account - any changes or additions should be accurately documented and agreed by all involved parties beforehand. Furthermore, it is essential that the terms are clearly written out in an unambiguous way so every party knows exactly what they have signed up for. Beyond protecting both sides’ interests, this type of agreement can also be used for copyright assignments, leases, debt transfers and trusts.

Before signing on the dotted line it’s also critical that executing such documentation is done properly - all parties must sign in the presence of a witness who will also affix their signature and date the document accordingly. Once this process has been completed filings must then be made with any relevant government authorities whenever necessary (especially in cases involving real estate or intellectual property transfers).

In summary, drafting a Deed of Assignment not only safeguards everyone’s best interests but also provides additional benefits depending on its use case - reading through our step-by-step guidance below should provide you with more information on how to access our template library today and start benefitting from its advantages without needing to sign up for an account with Genie AI first!

Definitions (feel free to skip)

Legal Binding: When a legally binding document is used, it means that all parties involved are legally obligated to follow the terms and conditions set forth in the document.

Assignor: The assignor is the person who is transferring rights, interests or assets to someone else.

Assignee: The assignee is the person who is receiving the rights, interests or assets from the assignor.

Witness: A witness is an independent third-party who is present when a document is signed, in order to ensure that the process is completed in a secure and legally binding manner.

Stamp: A stamp is an official seal or mark that is used to verify and authenticate a document.

Tax: A tax is a sum of money that is paid to a government or public authority.

Duty: Duty is an obligation or responsibility assigned to someone.

Defining the Deed of Assignment

What is a deed of assignment and what is its purpose, parties involved, who needs to be involved in the making of a deed of assignment, drafting the deed, determine what kind of deed of assignment needs to be drafted, consider the subject matter to be assigned in the deed, research the legal requirements for the kind of deed to be drafted, draft the deed of assignment in accordance with the legal requirements, executing the deed, check that the parties to the deed are correctly identified, confirm that the deed is correctly signed and dated by all parties, confirm that the deed is witnessed by an independent third party, have the deed of assignment properly executed by all parties, registration, determine whether the deed of assignment needs to be registered, if registration is necessary, confirm the registration procedures, take necessary steps to register the deed of assignment, considerations, consider any applicable tax or stamp duty implications of the deed of assignment, consider any restrictions or limitations on the rights being assigned, consider whether the deed of assignment needs to be registered in any public records, common mistakes, not accurately identifying all of the parties to the deed, not having the deed properly executed by all parties, not having the deed witnessed by an independent third party, not considering any applicable tax or stamp duty implications, not considering any applicable restrictions or limitations on the rights being assigned, record keeping, ensure that the original deed of assignment is securely stored, create a digital copy of the deed and store it in a secure manner, review the deed of assignment to ensure accuracy, confirm that all steps have been completed correctly, seek advice from legal professionals if necessary, get started.

• Establish the parties involved in the Deed of Assignment
• Identify the property or service being assigned
• Specify the terms of the assignment
• Ensure the Deed of Assignment is properly witnessed
• Check that all signatures are valid

When you have completed the steps above, you will have successfully defined the Deed of Assignment and can proceed to the next step.

• A deed of assignment is a legal document that is used to transfer the rights and responsibilities of one party (the assignor) to another party (the assignee)
• It is used to transfer contractual rights and obligations between parties
• It should include information such as the names of the parties, the date of the assignment, and the description of the rights transferred
• You will know that you have completed this step when you have an understanding of what a deed of assignment is and why it is used.
• Identify the party transferring their rights (the assignor) and the party receiving the rights (the assignee)
• Draft the deed in the name of both parties, including full names and contact details
• Ensure the deed is signed by both the assignor and assignee
• Once the deed is signed, the parties should exchange copies of the document

Once the assignor and assignee have been identified and the deed has been drafted and signed, you can check this step off your list and move on to the next step.

• Identify the parties involved in the Deed of Assignment. This would typically include the assignor (the party transferring their rights or interest) and the assignee (the party receiving the rights or interest).
• Ensure that all parties involved have the legal capacity to enter into a contract.
• When all parties have been identified and their legal capacity has been verified, you can check this step off your list and move on to drafting the Deed.
• Read the applicable laws in your jurisdiction to determine the required language and structure of the Deed of Assignment
• Gather the necessary information on the parties, the asset being assigned, and other relevant details
• Draft the Deed of Assignment, taking into account all the necessary details
• Make sure the language is clear and unambiguous
• Have the Deed of Assignment reviewed by a legal professional
• When the Deed of Assignment has been drafted and reviewed, you can move on to the next step.
• Identify the type of assignment that needs to be drafted and the legal requirements that need to be satisfied
• Consider the purpose of the Deed and the rights and obligations of the parties to the Deed
• Determine if the Deed is for an absolute or conditional assignment
• Consider if the Deed should be an express or implied assignment
• Determine if the Deed needs to be in writing or if it can be oral
• Check the applicable laws in your jurisdiction to ensure that you are drafting a valid Deed
• Check if there are any additional requirements that need to be included in the Deed

When you can check this off your list: Once you have identified the type of assignment and the relevant legal requirements, you can move on to considering the subject matter to be assigned in the Deed.

• Identify the subject matter of the Deed of Assignment, such as a patent, trademark, copyright, or other intellectual property
• Assess the value of the subject matter and any associated liabilities
• Understand the relationship between the assignor and assignee
• Have all necessary documents, such as a purchase agreement, to provide more detail about the assignment

Once you have identified the subject matter of the Deed of Assignment, assessed its value, understand the relationship between the assignor and assignee, and gathered any additional documents, you can move onto the next step of researching the legal requirements for the kind of Deed to be drafted.

• Research the relevant legislation, case law, and other materials related to the Deed of Assignment to be drafted
• Consult with a lawyer familiar with the relevant law to understand the requirements
• Take detailed notes on the legal requirements that must be adhered to in the Deed of Assignment
• Once you have all the necessary information, double-check that you understand the requirements before moving on to the next step.
• Prepare the text of the Deed, ensuring that all relevant information regarding the parties, the subject matter, and the consideration is included
• Check to make sure the language conforms with relevant laws and regulations
• Have the Deed reviewed by a solicitor to ensure that it complies with all legal requirements
• Once the Deed has been approved by a solicitor, have the parties sign the document
• Once the Deed has been signed by both parties, make multiple copies and ensure each party has a copy
• This step is complete once the Deed has been signed and each party has a copy of the document.
• Ensure both parties sign the Deed of Assignment in the presence of two witnesses who are over the age of 18 and not parties to the Deed
• Have both parties sign the deed in the presence of two witnesses and have the witnesses sign the deed to attest to witnessing the signature of the parties
• Check that the parties have signed the Deed in the presence of the witnesses by noting the signatures and the dates of signature in the execution clause of the Deed
• Once the Deed has been executed, have the parties date and keep a copy of the Deed in a secure place
• You will know that you have completed this step when the Deed has been properly executed by the parties in the presence of two witnesses.
• Identify all parties to the Deed and verify that their details are correct.
• Ensure that all parties to the Deed are identified in the document and that the details of each party are accurate and up-to-date.
• Check that the names, addresses and contact details of each party are correct.
• Once you have verified that the parties and their details are correctly identified, you can move on to the next step.
• Check that all parties have signed the Deed in the correct place, and that the date of signature is correct
• Ensure that each party has signed the Deed in the presence of an independent witness
• Check that all parties have signed the Deed with their full name and title, if applicable
• Confirm that the date of signature is correct and that all parties have signed on the same date
• Once you have verified that all parties have correctly signed and dated the Deed, you can proceed to the next step.
• Ensure that the Deed is witnessed by an independent third party who is not a party to the Deed.
• Ask the third party to sign the Deed and provide their name, address, occupation and date of signing.
• Check that the third party has signed and dated the Deed.
• Once the above is complete, you can check this step off your list and move on to the next step.
• Obtain signatures from all parties on the deed of assignment, ensuring that each party signs in the presence of a witness
• Have an independent third party witness each party’s signature
• Ensure that all parties have a valid form of identification, such as a driver’s license or passport, available for inspection by the witness
• Ensure that all parties sign the deed of assignment in the presence of the witness
• Obtain the witness’ signature, confirming that all parties signed in the presence of the witness
• You will know this step is completed once all parties have signed the deed of assignment and the witness has signed confirming they were present during the signing.
• Obtain a copy of the executed Deed of Assignment from all parties
• Contact the relevant state or territory office to determine whether the Deed of Assignment needs to be registered
• If registration is required, complete the necessary forms, pay the registration fee, and submit the required documents
• Once the Deed of Assignment is registered, the registrar will issue a certificate of registration
• Check off this step when you have received and reviewed the certificate of registration.
• Research the applicable laws and regulations in the relevant jurisdiction to decide if the Deed of Assignment needs to be registered
• Consult a legal professional if unsure
• When you have the answer, you can move on to the next step.
• Confirm what type of Deed of Assignment requires registration with the relevant government agency or registry.
• Research the registration procedures and the requirements you must meet in order to register the Deed of Assignment.
• Obtain any fees or additional documents that are necessary to complete the registration process.
• Ensure that all parties to the Deed of Assignment understand the registration process and the requirements for completing it.

You can check off this step once you have researched and confirmed the registration procedures for the Deed of Assignment.

• Gather the necessary documents for registration, such as the Deed of Assignment, supporting documents, and the applicable fee
• Visit the registration office to register the Deed of Assignment
• Submit the necessary documents to the registration office
• Pay the applicable fee
• Obtain a copy of the registered Deed of Assignment
• Upon completion of the above steps, you can check this off your list and move on to the next step.
• Review and understand the nature of the rights and obligations being assigned
• Determine if there are any restrictions or limitations in the assignment
• Assess if any approvals are needed from third parties before the assignment is valid
• Confirm that the assignor has the right to assign the interest being transferred
• Check to see if the assignee has the necessary capacity to accept the assignment
• Analyze if the assignment is subject to any applicable laws or regulations
• Determine if any additional documentation is needed to support the assignment
• Once you have considered all of the above, you can proceed with drafting the Deed of Assignment.
• Check with your local taxation authority or a qualified tax professional to see if the Deed of Assignment is subject to any taxes or stamp duty.
• Ensure that the Deed of Assignment includes any required taxes or stamp duty payments.
• Check to see if the tax or stamp duty implications vary by jurisdiction.
• Once you’ve considered the tax or stamp duty implications, you can move on to the next step.
• Identify any restrictions or limitations that could affect the transfer of rights in the Deed of Assignment
• Consider whether there are any legal restrictions that must be observed in the transfer of the rights being assigned
• Research any relevant industry standards or regulations to ensure that the restrictions or limitations on the rights being assigned are compliant
• Ensure that the Deed of Assignment clearly outlines the restrictions or limitations of the rights being assigned
• When all restrictions or limitations on the rights being assigned are taken into consideration, checked for compliance and outlined in the Deed of Assignment, this step is complete.
• Consider whether the Deed of Assignment needs to be registered with any government or public agencies.
• Determine if any registration is required or optional.
• Research the relevant regulations and laws to ensure that the assignments are properly recorded.
• Check any local requirements or restrictions.
• Once you have determined that the Deed of Assignment does or does not need to be registered, you can move on to the next step in the process.

• Read over the Deed of Assignment twice to make sure you’re accurately identifying all of the parties to the Deed. Make sure you include the full names and addresses of the assignor and assignee, as well as any other relevant parties. • Check that the legal description of the subject property is accurate. • Ensure that the consideration (the amount being exchanged for the assignment) is stated clearly and accurately. • Make sure that the names of the initial parties to the Deed are also included in the recitals. • Ensure that the recitals and the express terms of the Deed are consistent with one another. • Make sure that the Deed is signed, notarized, and delivered in accordance with state law.

Once you’ve completed the above steps, you can check off this task and move on to the next step in the guide.

• Identify the assignor and assignee. The assignor is the party transferring their rights and the assignee is the party receiving the rights.
• Check all of the details are correct. This includes the names, addresses and other contact information for both parties.
• Draft the deed to ensure that the assignor and assignee are accurately identified.
• You can check this off your list and move on to the next step once you have confirmed that the assignor and assignee have been accurately identified in the deed.
• Ensure that all parties to the Deed have read, understood and agreed to the terms and conditions of the agreement.
• Have all parties affix their signature to the Deed and the accompanying documents.
• Check that all the signatures are dated and in the presence of a witness.
• When all parties have properly executed the Deed, you can move on to the next step.
• Ensure all parties have signed the Deed in the presence of a witness.
• The witness must be an independent third party who is not a party to the Deed.
• The witness must sign each page of the Deed that contains a party’s signature.
• The witness must also include their full name, address and occupation on the Deed.
• Once all of the above requirements are met, then you can check this off your list and move on to the next step.
• Determine the applicable taxes or stamp duty implications for the Deed of Assignment.
• Research any applicable taxes or stamp duty fees for the Deed of Assignment.
• Calculate the applicable taxes or stamp duty fees for the Deed of Assignment.
• Make sure to include the applicable taxes or stamp duty fees in the Deed of Assignment.

Once you have determined the applicable taxes or stamp duty implications for the Deed of Assignment, and included them in the Deed of Assignment, you can move on to the next step.

• Determine the rights that you are assigning and review any applicable laws or regulations to ensure that the assignment of such rights is permitted.
• Consider any applicable contractual restrictions or limitations on the rights being assigned, such as any applicable confidentiality obligations or restrictions on the transfer of rights.
• Once you have determined that the assignment of the rights is permitted and there are no applicable restrictions or limitations, you can proceed to the next step of recording keeping.
• Create a record of the Deed of Assignment, including the date it was executed, by each party
• Maintain a copy of the Deed of Assignment in a secure place
• Record any additional related documents, such as any security documents, release documents, or other agreements
• When all of the above have been done, you can check this off your list and move on to the next step.
• Obtain a physical copy of the original Deed of Assignment
• Ensure the original Deed is signed by both parties
• Keep the original Deed in a safe and secure place, such as a locked filing cabinet or safe
• Make sure the document is stored in a location that is accessible to both parties
• Ensure that the original Deed is not destroyed or tampered with in any way

You can check this off your list and move on to the next step once the original Deed of Assignment is safely stored in a secure location.

• Scan or take a digital photo of the original Deed of Assignment and save it to a secure location.
• Ensure that the digital copy is readable and clearly displays all of the information contained in the original document.
• Ensure that the digital copy is stored in a secure location, preferably on a cloud-based storage system or other secure server.
• Make sure that only authorized personnel have access to the digital copy of the Deed.
• When finished, you will have created a digital copy of the Deed and stored it in a secure manner.
• Read over the Deed of Assignment to ensure accuracy
• Make sure all details are correct, and all parties are named
• Verify that all signatures are complete and accurate
• Make sure the date of the assignment is correct
• Check that the document is formatted and laid out correctly
• Once you are satisfied with the accuracy of the Deed of Assignment, you can move on to the next step.
• Read through the entire document to make sure all the information is correct
• Double check that the names and details of the parties involved are spelled correctly
• Ensure that all the dates are accurate, and that any and all parties have signed the deed in the right places
• Check that the terms and conditions in the deed are consistent with the agreement between the parties
• When you have verified all the details, you can check this off your list and move on to the next step.
• Check the Deed of Assignment to ensure that all required elements are present, including accurate information and signatures of all parties.
• Verify that any and all attachments to the Deed of Assignment are included and accurate.
• Ensure that all dates, signatures, and other pieces of information are accurate and up-to-date.
• Once you’ve confirmed that all of the steps have been completed correctly, you can move on to the next step.
• Seek professional advice from a lawyer or other legal professional to ensure that the deed of assignment is legally binding and enforceable.
• Request that the legal professional checks that all steps have been completed correctly, and that the deed of assignment meets all requirements under local law.
• Ask the legal professional to provide you with written advice on any changes or revisions that may be necessary to make the deed of assignment valid and enforceable.
• Once the legal professional has confirmed that the deed is legally sound, you can check off this step and proceed with the next one.
• Research legal professionals who are able to provide advice and assistance with the drafting of a deed of assignment
• Contact the legal professionals to discuss the specific requirements and details of the deed of assignment
• Ask the legal professionals if they are able to provide advice and assistance with the deed of assignment
• Receive advice from the legal professionals and make changes to the deed of assignment accordingly
• Once you are satisfied with the changes to the deed of assignment, you can move on to the next step.

Q: Does a Deed of Assignment need to be signed?

Asked by John on April 23rd 2022. A: Yes, a Deed of Assignment needs to be signed by both the assignor and the assignee in order for it to be legally binding. The signatures should be witnessed and dated, and should be in front of an independent witness who is not related to either party. It is also important to include the relevant clauses and provisions in the deed, as these will set out the rights and obligations of each party.

Q: What is the difference between an assignment and a novation?

Asked by Sarah on July 29th 2022. A: An assignment is a transfer of rights or obligations from one party to another, while a novation is a transfer of rights or obligations from one party to another with the consent of all parties involved. An assignment does not necessarily require the consent of all parties, while a novation always requires the consent of all parties. Additionally, an assignment can transfer rights or obligations without necessarily extinguishing any pre-existing agreements, while a novation extinguishes any pre-existing agreements.

Q: Is a Deed of Assignment legally binding in different jurisdictions?

Asked by Tyler on October 17th 2022. A: Yes, a Deed of Assignment can be legally binding in different jurisdictions, though the exact requirements for validity may differ from jurisdiction to jurisdiction. In general, however, a Deed of Assignment needs to be signed by both parties and witnessed by an independent third party in order for it to be legally binding. Additionally, the deed should include all relevant clauses and provisions that are applicable in each jurisdiction.

Q: Are there any tax implications when drafting a Deed of Assignment?

Asked by Emma on January 15th 2022. A: Yes, there are tax implications that need to be taken into account when drafting a Deed of Assignment. Depending on the jurisdiction and specific tax laws, there may be tax implications for both parties if they are transferring rights or obligations under the deed. It is important to seek professional tax advice before entering into any agreement that involves transferring rights or obligations between parties as this could have significant financial implications for all involved.

Q: Do I need legal advice when drafting a Deed of Assignment?

Asked by Jacob on June 5th 2022. A: While it is not necessary to seek legal advice when drafting a Deed of Assignment, it is generally recommended in order to ensure that all relevant legal requirements are satisfied and that all involved parties are aware of their rights and obligations under the deed. It is also important to make sure that all language used in the deed is clear and unambiguous so that it can easily be understood by all parties involved.

Q: How can I ensure that my Deed of Assignment is valid?

Asked by Michael on August 28th 2022. A: In order for your Deed of Assignment to be valid, it must meet certain legal requirements which vary between jurisdictions. Generally speaking, your deed should include all relevant clauses and provisions applicable in your jurisdiction as well as signatures from both parties which should be witnessed by an independent third party who is not related to either party involved. Additionally, any language used within the document should be clear and unambiguous so that it can easily be understood by all involved parties.

Q: What information do I need to provide when drafting a Deed of Assignment?

Asked by Ashley on November 10th 2022. A: When drafting a Deed of Assignment, you will need to provide information about both parties involved such as their names, addresses, contact details and any other relevant information required under applicable laws in your jurisdiction. Additionally, you will need to include any relevant clauses or provisions applicable in your jurisdiction which will set out the rights and obligations of each party under the deed as well as any other information required for the document to be legally binding.

Q: What are common mistakes made when drafting a Deed of Assignment?

Asked by Joshua on February 20th 2022. A: One common mistake made when drafting a Deed of Assignment is failing to include all relevant clauses or provisions applicable in your jurisdiction which set out the rights and obligations of each party involved in the agreement. Additionally, failing to have the document signed by both parties or witnessed by an independent third party can render the document invalid or unenforceable under applicable law in some jurisdictions. Moreover, using ambiguous language within the document can also lead to misunderstandings and disputes further down the line which could be avoided if clear language was used throughout the document instead.

Example dispute

Lawsuit referencing a deed of assignment.

• The plaintiff may raise a lawsuit if they have been wronged by the defendant in a way that is outlined in the deed of assignment.
• For example, the deed of assignment may outline that the defendant is responsible for paying a certain amount of money to the plaintiff, and the defendant has failed to do so.
• The plaintiff may also raise a lawsuit if the defendant has failed to adhere to any other obligations laid out in the deed of assignment.
• The plaintiff would need to prove that the defendant has breached the deed of assignment in order to win the lawsuit.
• If successful, the plaintiff may be able to obtain a judgment in their favor, which may require the defendant to pay the plaintiff the money they are owed.
• In addition, the plaintiff may be able to seek other damages, such as punitive damages, if the breach of the deed of assignment was particularly egregious.
• Depending on the severity of the breach, the plaintiff may also be able to seek an injunction to prevent the defendant from continuing to breach the deed of assignment.
• Settlement of the dispute may also be possible, wherein the defendant agrees to pay a certain amount of money to the plaintiff, or agrees to adhere to the obligations laid out in the deed of assignment.

Templates available (free to use)

Deed Of Assignment For Rent Deposits Occupation Lease Deed Of Assignment Of Benefit Of Claim For The Freehold Or Extended Lease House Under Section 8 Or Section 14 Deed Of Assignment Of Equitable Interest In Residential Land Deed Of Assignment Of Goodwill And Intellectual Property Rights Transfer Of A General Partnership To An Llp Deed Of Assignment Of Property Sale Benefits [Section 42 Deed Of A

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Investor’s Guide To The Real Estate Contingency Contract

What is a contingency contract?

Real estate purchase contract

Contract contingency rules

The provisions of a contingency contract in real estate are there to help buyers and sellers alike. Including contingencies is a good way for investors to stay out of a bad situation with a real estate contract. These added clauses enable investors to acquire properties on their terms and provide a way out if things go south. Because a real estate contract is a binding agreement, it is imperative for investors to understand contingencies, how they’re used, and the many variations available.

How Does A Real Estate Transaction Work?

A real estate transaction works similarly to any other deal, albeit with a few more formalities. An interested buyer starts the process by submitting an offer on the house, the seller can then choose to accept, counter, or reject. Once a counter offer is submitted, negotiations will begin until both parties accept the terms of the deal (or one party decides to walk away). In most cases, negotiations are handled by real estate agents.

From there, the buyer needs to submit an earnest money deposit — essentially saying they are serious about the deal and moving forward. The amount is typically one or two percent of the sales price. From there, the closing process will begin where the inspection, appraisal, and any other actions must take place before the final contracts are signed. During this time, the buyer also finalizes their financing for the deal.

What Is A Contingency Contract In Real Estate?

A contingency contract in real estate is a conditional purchase agreement with stipulations that must be met to complete the sale. According to Investopedia.com , a contingency in real estate is a “condition or action that must be met for [the] contract to become binding.” Real estate contingencies are meant to safeguard investors, but they can also work as a double-edged sword. While these stipulations may further protect investors from mistakes, they can also hurt the negotiation process. The overuse of contingencies can overwhelm sellers in some cases and ultimately hurt the completion of a deal.

Because every real estate deal is different, investors must understand how to incorporate contingencies adequately. The number of contingencies investors use will vary from deal to deal and property to property; the right combination will depend on both the type of deal and the fine print and all parties involved.

Contingency Vs. Contingent Listing

Contingency is a word thrown around a lot in the real estate industry. Essentially, a contingency is a condition that must be met before an agreement can move forward. The word is thus used to describe contracts that depend on certain changes.

A contingent listing is used to describe a sale that is pending but not complete. These listings are dependent on a few different factors during the closing process. Contingent listings are expected to close, but the property will not be taken completely off the market until then.

Primary Components Of A Real Estate Purchase Contract

Residential real estate contracts typically consist of the these 7 different items:

As a home buyer, there are many contingencies that can be included in your home sale contract. Keep reading to understand the rules of each.

Real Estate Contract Contingency Rules

A contingency contract requires one or both parties to meet certain prerequisites before the completion of a deal. The nature of this process leaves room for negotiation, compromise, and in some cases, confusion. This is because many investors fail to learn the basics of a contingency contract before heading into battle (or at least closing). To best protect yourself and your future investment, learning about the various elements necessary to a contingency contract is crucial. The following overview is a great way to prepare for real estate contingencies:

Can You Make An Offer On A House That Is Pending?

You can make an offer on a house that is pending, although there is no guarantee that your offer will go anywhere. However, this should not discourage you. If a sale is pending, nothing stops you from making a backup offer if the current contract falls through. Also, if the active contract has an existing real estate contingency, such as a kick-out clause, the contract’s chances of falling through increases.

Contingent vs. Pending

You’ll often see the words “contingent” and “pending” when perusing real estate listings. Both of these terms are used to convey the transaction phase that a property is currently in. Contingent in real estate indicates that an offer has been accepted and that the property is under contract. However, certain contingencies must be met in order for the sale to go through. As an interested buyer, this signals that the deal is not necessarily finalized and that it may be worth monitoring the property in case the deal falls through. Pending indicates that the transaction is one step closer to final closing. The buyer either put in an offer with no contingencies or removed their contingencies.

Contingency Period Length

An inspection contingency period can be anywhere from one to two weeks, while a mortgage contingency lasts between 30 and 60 days on average. Essentially, the contingency period length depends on the type of contingency involved.

Most Purchase Agreements Are Contingent On Which Two Items?

The inspection and financing contingencies are the two most important contingencies home buyers should care about most. No home buyer wants to close on a transaction only to find hidden defects three months down the line. This is why including an inspection contingency in the purchase agreement is a must. The financing contingency is also important because it states the closing timeline. This protects the buyer because if, for whatever reason, they are unable to acquire the necessary funds, they will still be able to receive a full refund on their earnest money deposit.

There are, of course, several other contingencies that exist to help protect both the buyer and seller in any real estate transaction (which you can read on to learn more about), but in terms of the purchase agreement, including both an inspection and financing contingency will ensure a smooth deal.

8 Must-Have Real Estate Purchase Agreement Contingencies

Appraisal Contingency: This contingency for buyers is used to make sure the property is valued at least at the specified amount.

Financing Contingency: Also referred to as a mortgage contingency, the buyer can gain more time to obtain financing in order to purchase the property.

Home Inspection Contingency: This contingency provides the buyer with an opportunity to have the property inspected and negotiate the purchase price or repairs based on any findings.

Home Insurance Contingency: This contingency requires the home buyer to purchase a home insurance policy, and is sometimes added by the seller or a requirement from the lender.

Right To Assign Contingency: A right to assign contingency is especially useful for wholesale real estate investors, as it provides the option to back out if they are unable to assign the contract to another buyer in a timely manner.

House Sale Contingency: This contingency provides a period of time for the buyers to finalize the sale of their current property.

Kick-Out Clause: The kick-out clause helps to protect sellers when their buyers use a house sale contingency, allowing them to back out if they find a more qualified buyer.

Title Contingency: If there are any issues with the title, such as an ownership dispute or lien, this contingency allows buyers to walk away if the problem cannot be resolved before closing.

1. Appraisal Contingency

The mainstay of any real estate contract is the appraisal contingency. This stipulation essentially awards investors two options: back out of a deal if the appraisal price on a property is not as high as the purchase price, or renegotiate the purchase price with the ability to end the deal if they decline.

The appraisal of a property is typically performed by a professional and licensed appraiser. Their responsibilities are to estimate the home’s value and produce a written report with an appraised value attached. The amount of money a bank loans will be based on the property’s appraisal value. If the appraisal amount is lower than the home price, the buyer is responsible for making the difference. For example, if a home appraisal comes in at $400,000, and the asking price is $500,000, the bank will only loan $400,000. In this case, the buyer would need to come up with an additional $100,000 to purchase the property.

2. Financing Contingency

Another common stipulation in a real estate contract is the financing contingency. This clause states the offer is contingent on your ability to obtain financing , and it will specify the type of financing, terms, and the amount of time in which you have to apply and be approved for the loan.

The financing contingency is important for many reasons. One of the biggest reasons is in the event your loan falls through at the last minute, and you are unable to secure financing in time. This ruling will allow you to walk away from the deal without repercussions or loss of earnest deposit. Consequently, this contingency is another reason why sellers prefer to do business with all-cash buyers .

3. Home Inspection Contingency

Far and away, the home inspection is one of the more important protection contingencies of a real estate contract. This period of due diligence, which will often range from three to 14 days, allows investors a period of time to conduct inspections on the property, including various walk-throughs, to ensure the property is up to their buying standards. A home inspection will provide the buyer will a detailed report of the property and outline any repairs and future issues that may arise.

A typical home inspection will cover the following:

Pest and termites

Heating and air conditioning

Lead-based paint

Easements and encroachments

Foundation and basement

Roof inspection

Sewer or septic system

Soil stability

Trees and vegetation

Water systems and plumbing

Radon or methane gas

Formaldehyde

Permits and zoning

As an investor, you have three options with the home inspection contingency: Ask for a discount to help with any necessary repairs, accept the offer and make the repairs, or back out of the deal based on the findings of the home inspection report.

4. Home Insurance Contingency

Another crucial contingency to add in your real estate contract is home insurance . Lenders, and sometimes even the seller, will require buyers to apply for and obtain homeowner’s insurance. Furthermore, this condition will typically be added in the home sales transaction contract, fulfilling the conditions and requirements in the term completed during the escrow process.

The home insurance contingency seeks to protect a buyer’s new purchase from disasters such as property damage, fires, natural causes, and other issues. However, the act of obtaining insurance for a property — particularly in a specific region — may be harder than expected. As a result, insurance companies have become more reluctant to insure properties in certain areas and regions of the country. In return, this gives buyers an option to back out of a deal if they cannot secure insurance before closing.

5. Right To Assign Contingency

Lastly, the Right To Assign contingency is a standard clause for real estate investors, specifically wholesalers. These stipulations provide investors with the option to back out of a deal if they cannot assign the real estate contract to another buyer in an adequate timeframe. In most cases, a wholesale contract  will include a legal document called the Assignment of Contract, which states you are assigning the rights as the buyer in the purchase agreement to another buyer. With the Right To Assign contingency, wholesalers can protect themselves if the buyer defaults.

6. House Sale Contingency

Timing can often throw a wrench into anything we do in life, including buying and selling homes. Homebuyers will often try to sell their current home while shopping for a new one in many cases. In such cases, a house sale contingency is a real estate contingency clause that can help protect the buyer. If the buyers cannot sell their current home or at least the asking price within a specific amount of time, they can back out of the deal without being penalized. This may be one of the most common real estate contingencies.

7. Kick-Out Clause

If you are a seller, you may wonder what contract contingency might serve to protect you if a buyer would like to implement a house sale contingency real estate contract. Luckily, the kick-out clause is one of the most helpful contingencies real estate can offer. While the contingency contract is in effect, the kick-out clause allows the seller to continue marketing the property. Suppose the current buyer fails to remove the house sale contingency within the specified amount of time. In that case, the seller can back out of the contract and offer the property to another qualified buyer.

8. Title Contingency

A real estate attorney or title company will do a title search on the property during the home buying process. The title serves as a record of homeownership and is essential to the sale of the property. In most cases, any issues with the title can be resolved before the closing process. However, this situation could lead to several challenges for the potential new homeowners in some cases. A few examples include a lien on the property that must be paid before the sale or perhaps an ownership dispute if the seller cannot legally prove they own the property. A title contingency protects potential owners from these situations by allowing them the opportunity to walk away if these issues are not resolved before closing.

When Contingencies Are Not Met

When contingencies are not met, the contract can be voided. Legal language is embedded into contingency contracts that allows the buyer or seller to cancel the deal without challenges in these instances.

For example, if there is a contingency about the buyer selling their previous home and it does not sell — they are not obligated to move forward with the transaction. In this case contingencies are in place to protect the buyer from a tricky financial situation. If the contract is voided as a result of contingencies, both parties can renegotiate at a later time.

Real Estate Contingency Contracts: What To Be Careful Of

In the case of any unforeseen problems, real estate contingencies will provide a legal way out of transactions. This may make the deal less appealing in the seller’s eyes, especially in a competitive market with similar offers. While this may be an inevitable drawback, you can combat this by conducting thorough market research.

Several real estate contingencies won’t affect the views of sellers. Contingencies such as the mortgage financing clause and the home inspection contingency are presented in almost every contract and will not raise anything suspicious. It’s venturing away from these common-sense contingencies that could eventually raise red flags. A market-based approach to real estate contingencies is highly recommended for an investor. Again, set aside ample time to conduct local market research. Find out how many homes are being sold and how fast. Market analysis will help you decide which real estate contingencies to include and which ones to omit.

The ability to anticipate potential problems with a real estate contingency contract comes down to having the insight to include contingencies from the get-go. While some believe eliminating these clauses will enhance your chances of closing deals, it can also leave you (and your pocketbook) high and dry when things go awry. Having a clear understanding of contingencies—including what’s typically used, as well as what’s not—will only better ensure your chances at scoring an excellent real estate deal.

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Madras High Court

Mrs.k.anbukkarasi vs the state of tamil nadu on 20 september, 2023, author: s.m.subramaniam, bench: s.m.subramaniam.

The present writ petition is filed challenging the order dated 28.03.2017 passed by the Commissioner of Land Administration, Chennai and to direct the respondents 2 and 3 to remove the entries made in the revenue records.

PETITIONER'S CASE:

2. The petitioner states that her father Mr.Kangeyan purchased an extent of 8.13 acres of land in O.S.No.424, New Survey Nos.41/1, 41/2 and 41/3 Ozhithiyampattu Village, Vanur Taluk, Villurpuram District from the legal heirs of one Periyasamy during the period 2002 to 2015. The Subject Page 2 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 land absolutely belonged to Mr.Periyasamy and Patta No.370 was standing in his name. Mr.Periyasamy died in the year 1977 leaving behind his sons Murugesan, Ramu and Varanamuthu as his legal heirs. The said Varanamuthu also passed away leaving behind his sons Sivanandan, Duraikannu, Kamalakannan and Jeyakumar as his legal heirs. Subject properties were partitioned between the legal heirs of Mr.Periyasamy vide Partition Deed dated 12.11.1998 registered as Document No.3780 of 1998.

Mr.Periyasamy was the owner of the property to an extent of 8.13 acres.

3. The father of the writ petitioner after perusing the documents, title deeds, revenue records etc., purchased the subject property. The father of the writ petitioner purchased the property in the name of the petitioner to an extent of 7.94 acres. The petitioner settled the property to an extent of 4.15 acres in favour of one Devanayagam.

4. One Mr.Durai Shankar claiming to be the Power Agent of Mr.Balakrishnan preferred a complaint on 10.08.2016 to the National Commission for Schedule Caste, stating that the subject land was a Government land assigned to Panchamar Community and is now occupied Page 3 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 by other community people. He requested for necessary action to resume the subject land from the present holder and reassign it in favour of eligible beneficiaries. The National Commission for Scheduled Caste directed the 1st respondent / Commissioner of Land Administration to take appropriate action in respect of the holding of the subject property. The 2nd respondent submitted a report on 13.10.2016 to the 1st respondent stating that the subject land measuring to an extent of 8.13 acres comprised in Old Survey No.424 was reserved for conditional assignment and it was assigned to one Mr.Rathinam as per the proceedings dated 17.03.1928 bearing No.308/37. Necessary entries were made in the Conditional Assignment Register maintained in the Taluk. The legal heirs of the original assignee have sold the lands to the people of other communities and thereafter, further transfers were made. The petitioner filed objections setting out the facts and circumstances. The 1st respondent passed the order impugned in proceedings dated 28.03.2017, which is now under challenge in the present writ petition.

5. The learned counsel for the petitioner mainly contended that even as per the respondent the assignment was made in the year 1928 and the property assigned originally was subsequently transferred to many people Page 4 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 and at this length of time the respondents cannot resume the land, since the land vested with the original assignee, which was transferred. The 1st respondent failed to note that under the Panchami Land Act, it is mandatory that the classification of the land must stand reflected in column 12 and 13 of the A Register. In the absence of the land being classified as Panchami Land, DC Land, Conditional Land or Assigned Land or Inam Land or Anadhinam Land or Adidravidar Land, the 1st respondent cannot pass the impugned order merely based on presumption and assumption.

6. The A Register was prepared in the 1920 and after re-survey it was prepared in the year 1980, there is no classification that the land is a Panchami Land. Therefore, the impugned order is to be set aside. The extract of the Tax Assessment Register relating to Ozhithiyampattu Village issued by the Zonal Deputy Tahsildar, Vanur dated 25.10.2010 discloses under Column 4 therein that the subject property is a ryotwari punja land and the name of Mr.Periyasami is mentioned in Column 11. Column 12 does not contain any classification.

Page 5 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017

7. The learned counsel appearing on behalf of the petitioner relied on Section 10 of the Transfer of Property Act, 1882 and contended that the transfer made by the original assignee cannot be subjected to cancellation at this length of time and after several decades.

CONTENTIONS OF THE RESPONDENTS:

8. The 1st respondent / Commissioner of Land Administration, Chennai elaborately narrated the entire facts and circumstances in the counter affidavit and filed the relevant document by way of typed set of papers. The land in Old Survey No.424 in Ozhithiyampattu Village, then Tindivanam Taluk had been reserved for depressed class people as per composite South Arcot District Gazette Supplement No.9 (bjd; Mw;fhL $p[y;yh bfb$l; !g;spbkd;l) dated 25.09.1929. It was clearly stated that this land is reserved for the depressed class people. The copy of the South Arcot District Gazette is annexed for ready reference.

9. The land in Old Survey No.424 of Ozhithiyampattu Village measuring to an extent of 8.13 acres was assigned in favour of Thiru. Rathinam, under the special scheme of assignment of land to DC people, Page 6 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 vide conditional assignment No.308/37 dated 17.03.1928 and necessary entries have been made in the conditional assignment register maintained at Revenue Divisional office. In the 10(1) Chitta of fasli year 1370(1978), the land was registered under patta No.370 in favour of Rathinam, Periyasamy, Srinivasan and Sengeni Ammal. In adangal for the fasli 1378(1968), the land was registered in favour of Periyasamy. Subsequently, during the Re- Survey conducted in the year 1971 to 1979, the land was registered as R.S. No.41 with an extent of 3.25.0 Hectare under patta No.336 in favour of S. Periyasamy. Further, as per D.K.No.8A 103/1409 dated 27.10.1999, the said land had been subdivided and registered under separate patta Nos. 28, 894 and 336 in favour of Thiru.P.Ramu S/o Periyasamy, P. Murugesan S/o Periyasamy and S.Periyasamy S/o Sengeni respectively. Thereafter, the legal heirs of Thiru. Periyasamy among the other patta land owners have sold out the entire extent of assigned land (8.13 acres) in favour of minor Anbukkarasi (NON-SC) Daughter of Kangeyan under various registered documents during the year from 2002 to 2015. Based on the registered documents necessary name transfer in the registry of revenue has been carried out by Tahsildar, Vanur.

Page 7 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017

10. While things being so, one Thiru. D.Durai Shankar son of Duraikannu, has represented to the National Commission for Scheduled Caste, that the above land assigned to panchamar community in Ozhithiyampattu Village have been occupied by other community people and transfer of registry have also been made in the revenue records. The National Commission for Schedule Caste directed to submit the facts and information along with action taken report. Therefore, the first respondent directed the District Collector Viluppuram to investigate this matter and directed to furnish detailed report covering the facts and action taken.

11. The District Revenue Officer, Villuppuram has examined in detail with reference to rule provision made under RSO, 15-41(4) (iii) and RSO 15-18. And the allegations made by Thiru. D.Duraisankar was enquired and it was found that there are violation of conditions noticed in respect of conditional assignment given to Scheduled Caste people in Ozhithiyampattu Village, Vanur Taluk of Villupuram District. The District Revenue Officer Viluppuram has sent a proposal for cancellation of conditional assignment of land measuring an extent of 3.25.0 hectare (8.13 acres) made in favour of Page 8 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 Thiru. Rathinam in survey number 41/1, 41/2, 41/3 (old survey number 424) for violation of conditions.

12. Based on the proposal received from the District Revenue Officer, Villupuram for cancellation of assignment of land made in S.No.41/1, 41/2 and 41/3 the enquiry has been taken up after affording ample opportunities to the affected parties concerned. Hearing notices have been served to the Anbukkarasi on 04.01.2017 and arguments of the applicant and affected parties were heard on various occasions viz 17.11.2016, 01.12.2016, 15.12.2016, 04.01.2017, 31.01.2017, 27.02.2017 and 14.03.2017 and their statements were recorded.

13. From the enquiry, it was found that the land in question was undoubtedly depressed class lands reserved for assignment to SC people for the upliftment of their social status. As per the conditions of assignment under the special schemes, the assigned land should not be transferred or conveyed in favour of Non - DC people at any point of time. But, in the instant case, a portion of the assigned land was also conveyed to Thiru. Sambasiva Reddy, who belongs to NON- DC Community in the year 1960 Page 9 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 which itself is in violation of condition of assignment. During the year from 2002 to 2015 the land had been purchased by Thiru. Kangeyan on behalf of his minor daughter Anbukkarasi through registered documents in violation of conditions as noted above. In view of the above findings, the 1st respondent as per the provisions made under para 15 - 41(3) of RSO read with provisions made in para 15-3(2) XI of RSO the assignment made in favour of Thiru. Rathinam for the land measuring an extent of 3.25.0 Hectare in S. No.41/1, 41/2, 41/3 (an extent of 8.13 acres in old S.No. 424) of Ozhithiyampattu Village, Vanur Talk, Viluppuram District has been cancelled and directed the District Revenue Officer, Villupuram to resume the land from the occupiers and restore the same as Government Possession and also directed to take necessary action to cancel the entries made in revenue records in favour of Tmt. Anbukkarasi D/o Kangeyan for fresh assignment in favour of eligible persons who belong to DC Community.

14. Based on the order of Commissioner of Land Administration, patta owners name in survey number 41/1 (0.91.0 Hectares), 41/2 (0.77.0 Hectares) and 41/3 (1.57.0 Hectares) have been cancelled by the Revenue Divisional Officer Viluppuram vide TR 2017/0109/07/000022, TR Page 10 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 2017/0109/07/000023 and TR 2017/0109/07/000024 dated 26.07.2017 and restored the property as under Government Possession. Copy of the computerized revised A - Register is annexed for ready reference.

15. The 1st respondent gave ample opportunity to all the parties concerned and perused all the records. In all the stages of enquiry, ample opportunity was given to the petitioner to submit her objection. It is clearly mentioned in the conditional assignment dated 27.10.1999 that the violation of condition will amount to cancellation of the assignment automatically. It is the fact admitted by the petitioner herself that the land is assigned to Rathinam, who belongs to Scheduled Caste and the assignment is a conditional one. The transfer of patta in favour of the petitioner or her predecessor will not confer any right to protect her purchase and subsequent purchases, if any which would be an invalid one. The petitioner became the owner of the property by way of different sale deed, this will not confer any title to her since the original condition is itself violated and the assignment is deemed to have been cancelled on the day when the transfer has been made. The petitioner cannot claim that almost 19 transactions were made over the disputed property and hence her title has to be treated as genuine Page 11 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 one. As regards the averment in the petition that patta No.370 was kept in the name of Kangeyan (belongs to MBC) as he purchased it from Rathinam, it is well settled proposition that patta will not confer any title in favour of a person, also the issuance of patta is intended only to collect revenue (Kist). And simply that the patta has been transferred in the name of a person will not amount to conferment of title by the Government. The averments of deviation of the title by the petitioner through various person is immaterial for the present Writ Petition. The basic condition of the assignment has been violated and the petitioner cannot derive any title. The averment of the petitioner that the partition deed was executed on 12.11.98 under doc. No. 3780/1998 and based on that deed, that patta has been transferred in the name of the sharers is immaterial. As already submitted, the standing of patta in one person's name is only for the purpose of collection of land revenue, it does not confirm any title of a person. The partition or sale deed relied on by the Writ Petitioner is not binding upon the respondents even though several transactions are made and such Partition / Sale deeds will not prevent the government form cancelling the conditional assignment for violation. The basic principle that “Let the buyer be aware” is the answer for the entire objections raised by the Writ Petitioner. “Ignorantia legs neminem Page 12 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 excusat” is a legal principle to be strictly applied in this case. The Writ Petitioner ought not to have purchased the property, since it is a Panchami Land.

LEGAL PRINCIPLES:

16. In the case of R.Chandevarappa Vs. State of Karnataka reported in (1995) 6 SCC 309, wherein paragraphs 6 and 8 reads as under:

“6. Having given our anxious consideration to the respective contentions, the first question that arises for determination is what would be the nature of the right given to the assignee Dasana Rangaiah Bin Dasaiah. Article 39(b) of the Constitution of India envisages that the State shall in particular direct its policy towards securing that the ownership and control of the material resources of the community are so distributed as best to subserve the common good. Admittedly, Scheduled Castes and Scheduled Tribes are the weaker sections of the society who have been deprived of their economic status by obnoxious practice of untouchability and the tribes living in the forest area far away from the civilised social life. To augment their economic status and to Page 13 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 bring them on a par into the mainstream of the society, the State with a view to render economic justice envisaged in the Preamble and Articles 38 and 46 of the Constitution distributed the material resources, namely, the land for self-cultivation. It is an economic empowerment of the poor. It is common knowledge that many a member of the deprived classes live upon the agriculture either by cultivation on leasehold basis or as agricultural labour. Under these circumstances, the State having implemented the policy of economic empowerment to do economic justice assigned lands to them to see that they remain in possession and enjoy the property from generation to generation.

8. It was, therefore, held that the State is enjoined to provide adequate means of livelihood to the poor, weaker sections of the society, the dalits and tribes and to distribute material resources of the community to them for common welfare etc. Therefore, civil, political, social, economic and cultural rights are necessary to the individual to protect and preserve human dignity, social and economic rights are sine qua non concomitant to Page 14 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 assimilate the poor, the depressed and deprived, i.e., the dalits and tribes in the national mainstream for ultimate equitable society and democratic way of life to create unity, fraternity among people in an integrated Bharat. Property is a legal institution the essence of which is the creation and protection of certain private rights in wealth of any kind. Liberty, independence, self-

respect, have their roots in property. To denigrate the institution of property is to shut one's eyes to the stark reality evidenced by the innate instinct and the steady object of pursuit of the vast majority of people. The economic rights provide man with freedom from fear and freedom from want, and that they are as important if not more, in the scale of values. The effect of social and economic legislation was held thus:

“In fact, the cumulative effect of social and economic legislation is to specify the basic structure. Moreover, the social system shapes the wants and aspirations that its citizens come to have. It determines in part the sort of persons they want to be as well as the sort of persons they are. Thus an economic system is not only an institutional device for satisfying existing wants Page 15 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 and needs but a way of creating and fashioning wants in the future. The economic empowerment, therefore, to the poor, dalits and tribes as an integral constitutional scheme of socio-economic democracy is a way of life of political democracy. Economic empowerment is, therefore, a basic human right and a fundamental right as part of right to live, equality and of status and dignity to the poor, weaker sections, dalits and tribes.” The prohibition from alienation is to effectuate the constitutional policy of economic empowerment under Articles 14 , 21 , 38 , 39 and 46 read with the Preamble of the Constitution. Accordingly it was held that refusal to permit alienation is to effectuate the constitutional policy. The alienation was declared to be void under Section 23 of the Contract Act being violative of the constitutional scheme of economic empowerment to accord equality of status, dignity of persons and economic empowerment.”

17. In the case of Papaiah Vs. State of Karnataka reported in (1996) 10 SCC 533, wherein, the Apex Court held as follows:

“8. It is seen that Article 46 of the Page 16 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 Constitution, in terms of its Preamble, enjoins upon the State to provide economic justice to the Scheduled Castes, Scheduled Tribes and other weaker sections of the society and to prevent their exploitation. Under Article 39(b) of the Constitution, the State is enjoined to distribute its largess, land, to subserve the public good. The right to economic justice to the Scheduled Castes, Scheduled Tribes and other weaker sections is a fundamental right to secure equality of status, opportunity and liberty. Economic justice is a facet of liberty without which equality of status and dignity of person are teasing illusions. In rural India, land provides economic status to the owner. The State, therefore, is under constitutional obligation to ensure to them opportunity giving its largess to the poor to augment their economic position. Assignment of land having been made in furtherance thereof, any alienation, in its contravention, would be not only in violation of the constitutional policy but also opposed to public policy under Section 23 of the Contract Act, 1872. Thereby, any alienation made in violation thereof is void and the purchaser does not get any valid right, title or interest thereunder.

https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 It is seen that Rule 43(8) specifically prohibits alienation of assigned land. It does not prescribe any limitation of time as such. However, it is contended that the appellant has obtained land by way of sale in 1958 long before the Act came into force and thereby he perfected his title by adverse possession. We find no force in this contention.”

18. In the case of Sisili Ammal Vs. Sundararaja Naidu reported in (AIR 1946 Mad 52), this Court while dealing with a condition, similar to the one contained in clause (9) under the Crown Grants Act, 1895 held that though such a condition would be invalid if the grant was made by a private individual, the condition was perfectly valid in the case of a Crown grant. It was held by the Bench that the prohibition against alienation was not violative of the provisions of the Transfer of Property Act .

To Substantiate the Contentions, the Respondents Have Filed the Following Documents:

19. Re-survey and Resettlement Register for the Old S.No.424 dated

11.12.1920 filed by the respondent reveals as follows: Page 18 of 29

https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 1 2 3 4 5 6 7 8 9 10 11 12 13 24 ... 181A ... G D ... ... 8-5 8 0 13 8 13 6 10 jupR Revenue Settlement Officer, Party No.II, U.Manjappah, Cuddalore, 11th December 1920. Special Assistant Settlement Officer in Charge

20. South Arcot Zilla Gazatte Supplement (Reg.No.340 dated September, 1929) enumerates the land reserved for Depressed Class people in various Villages. In the said document Ozhithiyampattu Village has been included and Survey No.424 is also found in the said document.

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21. Chitta extract from Conditional Register for Survey No.424 has been enclosed, which reveals that the subject land in Survey No.424 measuring to an extent of 8.13 acres is a conditional assignment. The name of the original assignee Mr.Rathinam is also mentioned.

22. 10(1) Chitta for the Fasli year 1370, 10(1) Chitta for the Fasli Year 1375, 10(1) Chitta for the Fasli 1381 are filed before this Court. All Page 19 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 the Chitta Registers reveals that Mr.Rathinam, who belongs to Depressed Class Community was assigned Government land to an extent of 8.13 acres in Survey No.424 at Ozhithiyampattu Village.

23. The Government issued G.O.Ms.No.2555, Revenue Department dated 14.05.1973 contemplating the procedures for cancellation of violation. The powers are delegated to the Revenue Divisional Officer and that the Collectors are empowered to cancel or modify the orders of the assignment made by the Tahsildar or Revenue Divisional Officer without any time limit.

24. Adangal extract for Fasli year 1987 indicates the descriptions of the assigned land and the name of the legal heirs of the original assignee Mr.Rathinam has been mentioned.

25. The Government issued circular regarding cancellation of land assignment on 15.07.1997. Accordingly, the Government delegated powers to cancel assignments in the event of violation of conditions or irregular and illegal assignment are made. The power of cancellation of assignment is Page 20 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 directed to be exercised under Revenue Standing Order (RSO) 15. The Sub division sketch dated 16.11.1999 is produced by the respondents. As per the proceedings of the Tahsildar, Vanur, the legal heirs of Mr.Periyasamy are included in respect of the assigned lands.

26. In view of the fact that the conditional assignment has been violated and it is brought to the notice of this Court that the Commissioner of Land Administration through National Commission for Schedule Caste based on the complaint given by one Mr.Durai Shankar. The Commissioner of Land Administration conducted an enquiry and invited report from the Subordinate authorities. The Commissioner of Land Administration in the impugned proceedings dated 28.03.2017 elaborately considered the history of the case. The complaint of Mr.Durai Shankar was taken note of and the petitioner was afforded with an opportunity, who in turn submitted her defence statement, which was considered by the Commissioner of Land Administration. Statements of the Revenue Officials were recorded. The Statement of Mr.Bala Krishnan son of Mr.Periyasamy was also recorded. The findings made by the Commissioner of Land Administration reveal that the assigned properties were transferred in favour of the other community Page 21 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 people, which amounts to violation of the conditions imposed and in violation of the Revenue Standing Orders.

27. The 1st respondent based on the documents and evidence and by considering the defence made by the subsequent purchasers, held that it is evident from the chronological events narrated, the land in question was undoubtedly Depressed Class lands reserved for assignment to Schedule Caste people for the upliftment of their social status. As per the conditions of the assignment under the Special Schemes, the assigned land should not be transferred or conveyed in favour of non DC people at any point time. But in the present case a portion of the land was conveyed to Thiru. Sambasiva Reddy, who belongs to a caste Hindu Community in the year 1960, which itself is in violation of conditional assignment. However, the said piece of land has been repurchased by the family members of the original assignee in the same year itself. During the year 2002 to 2015 the subject land had been purchased by Thiru.Kangaiyan on behalf of minor daughter Mrs.K.Anbukkarasi / Writ petitioner through registered documents in violation of the condition of assignment. Since the condition of assignment is violated as noted above, it is necessary to cancel the Page 22 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 assignment and resume the land from the present occupier for reassignment in favour of eligible person from Depressed Class Community.

28. The Commissioner of Land Administration relied on para 15- 41(3) of the RSO read with provisions made in 15-3(2) XI of RSO and accordingly, cancelled the assignment and directed the District Revenue Officer to resume the land from the occupiers and restore the same for the Government possession.

29. Pursuant to the orders issued by the Commissioner of Land Administration necessary actions were taken by the Revenue Divisional Officer, Villupuram for correcting the A Register and to restore the Government land. Accordingly, corrections were made by the Revenue Divisional Officer in proceeding dated 17.04.2022. Further, consequential corrections were made in the UDR A Register, Adangal, Manual Chitta and in the FMB.

30. The records right from the year 1920 have been produced before this Court and the learned Additional Advocate General appearing on behalf Page 23 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 of the State coherently referred the documents and established that the Government land reserved for the benefit and to protect the livelihood of the Schedule Caste community people was assigned in favour of Mr.Rathinam and subsequently, the said DC lands were transferred in violation of the assignment conditions during the year 2002 to 2015. FINDINGS:

31. In the present case, Old Survey No.424 in Ozhithiyampattu Village then Dindivanam Taluk had been reserved for Depressed Class people. The ground raised by the petitioner that it was not classified as Panchami Land is irrelevant, since it is a conditional assignment of DC land made in favour of one Mr.Rathinam and the legal heirs of Mr.Rathinam were transferred to non-DC communities persons, despite the fact that the conditions stipulate that the land cannot be transferred to other community people at any point of time. Admittedly, the legal heirs of the original assignee transferred the lands in favour of other community people and therefore, the authorities are empowered to cancel the assignment and resume the land under para 15-41(3) read with provisions made in para15- 3(2) XI of RSO.

Page 24 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017

32. The Government land is classified as assessed dry waste and the land is kept as “Tharisu”. Therefore, the Government is the owner and custodian of the property.

33. In the present case, the documents produced by the 1 st respondent from the year 1920 onwards would be sufficient enough to form an opinion that the Government land was assigned in favour of one Mr.Rathinam, who belongs to Depressed Class Community. Land was assigned for the benefit of Schedule Caste Community people to protect their livelihood. The purpose for which the lands were assigned cannot be violated and in the event of violation, the authorities are empowered to cancel to assignment and resume the land under the Government orders and the Revenue Standing Orders.

34. The assignment of Government lands are made in order to achieve the Constitutional goal of 'Social Justice' and 'Equality'. More specifically for the upliftment of depressed class community people. Thus, conditions are imposed in the assignment orders. If the conditions are violated, the very Page 25 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 purpose and object of assignment is defeated. Pertinently, such violations would result in an unconstitutionality since the rights of other depressed class community people for assignment of Government land is infringed.

35. Court shall consider these issues not only on factual perspectives but on the Constitutional perspectives. The Government lands are provided for the upliftment of depressed class people. By transferring the property to the other community people, the very object of upliftment is defeated and thus, it is an unconstitutionality. The Government has to reveiew all such assignments of Government lands across the State of Tamil Nadu and identify the violations and initiate all appropriate actions to ensure that the assignments are made only in favour of the landless poor people belonging to the depressed class community.

36. In the present case, the 1st respondent could prove beyond any pale of doubt that the subject land was assigned in favour of Mr.Rathinam, who is a depressed class community person and the said lands assigned are transferred in violation of the conditions imposed in the assignment order and in favour of non-DC community people. Thus, there is no infirmity in Page 26 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 respect of the order passed by the Commissioner of Land Administration. No time limit has been fixed by the Government for cancellation of assignment in the event of violation of conditions. Therefore, the contention of the petitioner that they are enjoying the land for long years would not save their right. Contrarily any such continuance would lead to an unconstitutionality, in perpetuity and infringement of the right of other landless poor depressed class community people as they are longing entitled for assignment of Government land for their upliftment.

37. The 1st respondent is directed to resume the land and take physical possession of the land immediately without causing any undue delay.

38. With the above direction, this Writ Petition stands dismissed. Consequently, connected Miscellaneous Petitions are closed. However, there shall be no order as to costs.

20.09.2023 Jeni Index : Yes/No Speaking order/Non-Speaking order Neutral Citation : Yes/No Page 27 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 To

1.The Principal Secretary and Commissioner of Land Administration, The State of Tamil Nadu Chepuak, Chennai – 600 005.

2.The District Revenue Officer, Villupuram, Villupuram District.

3.The Revenue Divisional Officer, Villupuram, Villupuram District.

Page 28 of 29 https://www.mhc.tn.gov.in/judis  W.P.No.25159 of 2017 S.M.SUBRAMANIAM, J.

Jeni W.P.No.25159 of 2017 20.09.2023 Page 29 of 29 https://www.mhc.tn.gov.in/judis 

conditional ownership

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Conditional ownership is an interest in property that is subject to some form of condition being fulfilled before the interested party can gain absolute ownership . These conditions can be something required of the person receiving the property interest or can be something unrelated like a year. An individual can sell or gift property with conditions for a variety of reasons, and states differ on how property law should address conditional ownership. Examples of conditional ownership:

• Pam gifts her son Ravi $50,000 in trust if Ravi completes undergrad with a 3.0 GPA.
• Charles deeds the land beside his house to Caroline upon the condition that Caroline build a fence on the property close to his house. 
• Kate bequests $100,000 to each of her children upon the condition that they reach the age of 21. 

[Last updated in June of 2021 by the Wex Definitions Team ]

• property & real estate law
• trusts, inheritances & estates
• wex definitions

Deed of Assignment: Everything You Need to Know

A deed of assignment refers to a legal document that records the transfer of ownership of a real estate property from one party to another. 3 min read updated on January 01, 2024

Updated October 8,2020:

A deed of assignment refers to a legal document that records the transfer of ownership of a real estate property from one party to another. It states that a specific piece of property will belong to the assignee and no longer belong to the assignor starting from a specified date. In order to be valid, a deed of assignment must contain certain types of information and meet a number of requirements.

What Is an Assignment?

An assignment is similar to an outright transfer, but it is slightly different. It takes place when one of two parties who have entered into a contract decides to transfer all of his or her rights and obligations to a third party and completely remove himself or herself from the contract.

Also called the assignee, the third party effectively replaces the former contracting party and consequently assumes all of his or her rights and obligations. Unless it is stated in the original contract, both parties to the initial contract are typically required to express approval of an assignment before it can occur. When you sell a piece of property, you are making an assignment of it to the buyer through the paperwork you sign at closing.

What Is a Deed of Assignment?

A deed of assignment refers to a legal document that facilitates the legal transfer of ownership of real estate property. It is an important document that must be securely stored at all times, especially in the case of real estate.

In general, this document can be described as a document that is drafted and signed to promise or guarantee the transfer of ownership of a real estate property on a specified date. In other words, it serves as the evidence of the transfer of ownership of the property, with the stipulation that there is a certain timeframe in which actual ownership will begin.

The deed of assignment is the main document between the seller and buyer that proves ownership in favor of the seller. The party who is transferring his or her rights to the property is known as the “assignor,” while the party who is receiving the rights is called the “assignee.”

A deed of assignment is required in many different situations, the most common of which is the transfer of ownership of a property. For example, a developer of a new house has to sign a deed of assignment with a buyer, stating that the house will belong to him or her on a certain date. Nevertheless, the buyer may want to sell the house to someone else in the future, which will also require the signing of a deed of assignment.

This document is necessary because it serves as a temporary title deed in the event that the actual title deed for the house has not been issued. For every piece of property that will be sold before the issuance of a title deed, a deed of assignment will be required.

Requirements for a Deed of Assignment

In order to be legally enforceable, an absolute sale deed must provide a clear description of the property being transferred, such as its address or other information that distinguishes it from other properties. In addition, it must clearly identify the buyer and seller and state the date when the transfer will become legally effective, the purchase price, and other relevant information.

In today's real estate transactions, contracting parties usually use an ancillary real estate sale contract in an attempt to cram all the required information into a deed. Nonetheless, the information found in the contract must be referenced by the deed.

Information to Include in a Deed of Assignment

• Names of parties to the agreement
• Addresses of the parties and how they are binding on the parties' successors, friends, and other people who represent them in any capacity
• History of the property being transferred, from the time it was first acquired to the time it is about to be sold
• Agreed price of the property
• Size and description of the property
• Promises or covenants the parties will undertake to execute the deed
• Signatures of the parties
• Section for the Governors Consent or Commissioner of Oaths to sign and verify the agreement

If you need help understanding, drafting, or signing a deed of assignment, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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Content Approved by UpCounsel

• Define a Deed
• Contract for Deed California
• Contract for Deed in Texas
• Assignment Law
• Deed Contract Agreement
• Assignment Of Contracts
• Legal Assignment
• Deed vs Agreement
• Assignment Legal Definition
• Contract for a Deed

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Land Use Conditional Use Permits

Published: May 10, 2021

This content conveys general information. Do not use it as a substitute for legal advice. Any attorney general opinions cited are available from the League’s Research staff.

Conditional use

A conditional use is a land use the city permits in a zoning district only when the applicant meets certain standards. The zoning ordinance typically sets out:

• General standards that apply to all conditional uses, and
• Specific standards that apply to a particular conditional use in a given zoning district.

A use is typically conditional because of:

• Hazards inherent in the use itself, or
• Special problems that its proposed location may present.

For example, cities often designate uses that generate traffic (such as family child care, service stations, convenience stores, or drive-thrus) as conditional uses.

Conditional use permit

A conditional use permit (CUP) is a document. A city issues a permit to allow a conditional use when the applicant meets the general and specific ordinance standards. The permit allows the use only if the applicant addresses the standards set forth in the zoning ordinance. State law authorizes conditional use permits ( Minn. Stat. § 462.3595 ).

General CUP standards

A zoning ordinance typically details general standards that apply to all conditional uses. For example, an ordinance might require all conditional uses to conform to the comprehensive land use plan of the community, be compatible with adjoining properties, and be served by adequate roads and public utilities.

Specific CUP standards

Many zoning ordinances will also set out specific standards for a particular conditional use, such as businesses operating a drive-thru. Specific standards often address off-street parking and loading areas, landscaping and site plan, and hours of business operation.

Granting conditional use permits

Generally, cities may only grant CUPs for uses specifically listed in the zoning ordinance as conditional uses in a particular zoning district.

If a use is not designated as a conditional use in a zoning district, then arguably the city may not issue a CUP without first amending the zoning ordinance to provide for the conditional use. This would, of course, allow other applicants to apply for a conditional use permit under the same standards.

Who grants a CUP

Planning commissions often first consider the CUP application and make recommendations to the city council. State statute allows the city council to assign its CUP approval to another authority. Some cities designate the planning commission as the approving body but typically the city council approves a CUP.

Required approval

If a proposed conditional use satisfies both the general and specific standards set out in the zoning ordinance, the applicant is entitled to the conditional use permit. If the applicant meets all the ordinance standards, the city usually has no legal basis to deny the CUP.

60-Day rule

A written request for a CUP is subject to Minnesota’s 60-day rule. It must be approved or denied within 60 days of the time it is submitted to the city. A city may extend the time period for an additional 60 days, but only if it does so in writing before expiration of the initial 60-day period. Under the 60-day rule, failure to approve or deny a request within the statutory time period is considered an approval ( Minn. Stat. § 15.99 ).

Other conditions on permits

A city may attach reasonable conditions relating to the ordinance standards to a CUP based upon factual evidence contained in public record. For example, if a zoning ordinance says a conditional use should not have adverse visual or noise impacts on any adjacent property, a city might require specific screening and landscaping conditions to address any potential impacts established in the record.

Time limits not permitted

State statute says a CUP remains in effect as long as the conditions agreed upon are observed ( Minn. Stat. § 462.3595, subd. 3 ).The attorney general says time limits, such as sunset provisions or automatic annual review, are not consistent with state law, explaining that cities may not enact or enforce provisions that allow a city to terminate CUPs without regard to whether the conditions agreed upon are observed (A.G. Op. 59-A-32 (February 27, 1990)).

If a city wishes to place time constraints on particular uses, the appropriate zoning tool is an interim use permit, not a conditional use permit. State law authorizes interim use permits for:

• A temporary use of property until a particular date;
• Until the occurrence of a particular event; or
• Until zoning regulations no longer permit it ( Stat. § 462.3597 ).

Public hearings

The city may allow a proposed conditional use only after a statutorily required public hearing ( Minn. Stat. § 462.3595, subd. 2 ). The city must provide published notice of the time, place, and purpose of the hearing on a proposed CUP at least 10 days prior to the day of the hearing. If the decision affects an area of five acres or less, the city may need to mail notice to property owners within a 350-foot radius of the land in question. The purpose of the public hearing is to help develop a factual record as to whether the applicant meets the relevant ordinance standards such that the CUP should be granted ( Minn. Stat. § 462.357, subd. 3 ).

City role in hearing

A city exercises “quasi-judicial” authority when considering a CUP application. This means the city’s role is limited to applying the standards in the ordinance to the facts presented by the application. The city acts like a judge in evaluating the facts against the standards. If the applicant meets the standards, then the CUP should be granted.

In contrast, when the city designates certain uses as conditional in the zoning ordinance the city is exercising “legislative” authority and has much broader discretion.

Learn more about conducting public hearings in the League’s Zoning Guide for Cities

Role of neighborhood opinion

Neighborhood opinion alone is not a valid basis for granting or denying a CUP. While city officials may feel their decision should reflect the overall preferences of residents, their task is limited to evaluating how the CUP application meets the ordinance standards. Residents can often provide important facts to help the city address whether the application meets the standards, but unsubstantiated opinions and reactions to an application are not a legitimate basis for a CUP decision. If neighborhood opinion serves as the sole basis of the decision, it could be overturned by a court if challenged.

Documentation of hearing

Whatever its decision, a city should create a record that will support it. If a city denies a CUP application, the 60-day rule requires the reasons for the denial be put in writing. Even if a city approves a CUP, a written statement explaining the decision is advisable. The written statement should address the general and specific ordinance standards and explain the relevant facts and conclusions.

For information on creating a record, see Taking the Mystery Out of Findings of Fact

Conditional use permit after issuance

A conditional use permit is a property right that “runs with the land.” That is, it attaches to and benefits the land and is not limited to a particular landowner ( Minn. Stat. § 462.3595, subd. 3 ). State statute requires CUPs be recorded with the county recorder’s office ( Minn. Stat. § 462.3595, subd. 4 ). When the property is sold, the new landowner will have the continued right to the CUP so long as the conditions are met.

A city can revoke a conditional use permit if there is not substantial compliance with conditions. The revocation must be based upon factual evidence, after appropriate notice and hearing. Because a CUP is a property right, a city should work closely with the city attorney if considering a CUP revocation.

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Conditional contract

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About this document

This is a conditional contract, where the sale of land or property is subject to something happening before the deal can proceed to completion. In such an agreement, the entire deal is under contract and both sides are bound subject only to one or more conditions being met.

A conditional contract is an alternative to using property option agreements .

An option places the option holder (usually the potential property buyer) in control of whether the property is sold.

A conditional sale contract tends to favour the seller in that they know they have sold subject only to the condition being met. However, the buyer may also be in favour of using this agreement because they can be confident that they will not have to pay the purchase price until the condition is met and the deal takes place.

The most usual conditions are:

• obtaining a grant of planning permission for development or alterations
• the removal of a restrictive covenant on use
• finding reasonable finance for the project
• landlord's consent to sell leasehold land or for an assignment of a lease
• obtaining a satisfactory survey or ground reports or search results
• grant of access rights
• vacant possession of a building being obtained from an occupier
• grant of permission or licence for a particular use

You can edit the template easily for any other condition or multiple conditions.

The template is suitable for any type of land or property (residential or commercial property). For example, it might be used to buy:

• an office building to be redeveloped
• a field or derelict land to have houses built
• a house, flat or shop to be refurbished

This agreement also gives you an option for the seller to require an additional payment in the future. This provision gives a seller a stronger incentive to sell when he thinks that the buyer may be able to generate more value later. For example, if the buyer cannot obtain planning permission for the whole site and instead seeks planning permission in stages, the seller can benefit from the increase in value of the land as a result of the subsequent grants of permission. We suggest that a buyer should keep this provision in reserve and not offer it unless demanded.

Application and features

Using a conditional contract should be preferred over an option agreement when both sides are able to weigh the chance of the condition being satisfied. A conditional sale is done and dusted apart from the condition.

There can also be a tax advantage for the buyer of using a conditional rather than an unconditional contract. Under the Taxation of Chargeable Gains Act (TCGA) 1992, capital gains tax is calculated between the date of acquisition and the date of disposal. Since with conditional contracts the contract for sale only comes into existence when the condition is met, on the subsequent disposal, for the calculation of capital gains, the date and value of acquisition is not that when the contract was signed, but later when conditions are met. This timing difference can reduce a tax liability.

This agreement is a complete contract for the sale of land or property. When signed, both sides are committed to its terms. It does not require a separate or additional document other than the final transfer document for which you will require a solicitor.

While the contract is open, the seller accepts restriction over actions which could adversely affect the condition or value of the land or property to the buyer.

In case the seller is a limited company, the buyer can make the director guarantee this contract personally.

Satisfying conditions

Within the contract you should state which party is responsible for satisfying each condition and how they will be judged to have made effort to ensure that the conditions are met.

Contracts typically refer to one party using reasonable or best endeavours.

Best endeavours means that the party responsible for meeting the condition must take all steps in their power to ensure the condition is satisfied, even if that requires them to act against their own interests, perhaps incurring significant costs.

Reasonable endeavours is less onerous in that it allows the party to balance contractual requirements and personal and financial concerns. There is no obligation to pursue every possible course of action and instead they only need to carry out what would be considered a reasonable best course of action to achieve the result.

Good faith should be avoided but it is not clear how a court would interpret such an obligation in a dispute.

Be clear on timescales for meeting conditions

How long each party has to satisfy a condition must be specified precisely.

Deadlines should be realistic. However, you’ll want to be fair about the time allowed so that the party who has the obligation can meet it while the other party retains the ability to walk away after a reasonable time (usually after giving written notice). Bear in mind that a condition being met might require another party to take action (such as a local authority) and that how long this third party takes may not be in the buyer's or the seller's control.

The contract includes an end date (also known as a long-stop date) and sets out details relating to termination.

Considerations if the sale is conditional on obtaining satisfactory planning permission

If planning permission is being sought then the contract should cover whether a condition is met if permission is refused or granted subject to conditions. Specifically, you will need to agree:

• that any planning application might follow an agreed form
• whether any variations, restrictions or conditions are acceptable
• whether the refusal of planning permission can be appealed
• who pays associated costs with a planning appeal, extensions and variations
• how the purchase price might change

Typically, the price may be set at a certain percentage of the open market valuation of the property once planning permission has been granted or a fixed fee for each acre of developable land (or some combination of the two).

• Particulars of the contract: money and dates
• Details of the condition
• Conveyancing conditions and matters to which the deal is subject
• Extensive menu of seller’s warranties: title warranty, past disputes, planning history, local development, no charge or mortgage
• Option for top-up payment
• The seller must not interfere with the land or property while the contract is open
• The seller indemnifies the buyer against breach of the agreement
• Optional provision for a guarantor
• Provision for the buyer to assign his rights under the agreement
• Other protections and clarifications

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Collateral Assignment

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A collateral assignment involves granting a security interest in the asset or property to a lender. It is a lawful arrangement where the borrower promises an asset or property to the lender to guarantee the debt repayment or meet a financial obligation. Moreover, in a collateral assignment, the borrower maintains asset ownership, the lender holds the security interest, and the lender has the right to seize and sell the asset in event of default. This blog post will discuss a collateral assignment, its purpose, essential considerations, and more.

Key Purposes of a Collateral Assignment

Collateral assignment concerns allocating a property's ownership privileges, or a specific interest, to a lender as loan collateral. The lender retains a security interest in the asset until the borrower entirely settles the loan. If the borrower defaults on loan settlement, the lender can seize and market the collateral to recover the unpaid debt. Below are the key purposes of a collateral assignment.

• Enhanced Lender Protection: The primary purpose of the collateral assignment is to provide lenders with an added layer of security and assurance. Also, by maintaining a claim on the borrower's properties, lenders lower their risk and improve the probability of loan settlement. In case of default, the lender can sell the collateral to recover the unpaid balance. This security authorizes lenders to offer loans with lower interest rates, as the threat associated with the loan is reduced.
• Favorable Loan Terms: Collateral assignment allows borrowers to access financing on more favorable terms than unsecured loans . However, the terms of the loan will vary depending on the borrower’s creditworthiness and the value of the collateral. Generally, lenders are more willing to extend larger loan amounts and lower interest rates when they have collateral to fall back on. The presence of collateral reassures lenders that they have a viable means of recouping their investment, even in case of default. This increased confidence often leads to more competitive loan offers for borrowers.
• Unlocking Asset Value: Collateral assignment enables borrowers to leverage the value of their assets, even if those assets are not readily convertible into cash. For instance, a business owner with valuable machinery can assign it as collateral to secure a business loan. This arrangement allows the borrower to continue utilizing the asset for operational purposes while accessing the necessary funds for expansion or working capital. Collateral assignment, thus, enables the efficient allocation of resources. However, the collateral will still be considered in determining the loan amount and terms.
• Access to Higher Loan Amounts: When borrowers promise collateral against a loan, lenders can present greater loan amounts than for other unsecured loans. The worth of the collateral serves as a reassurance to lenders that they can recover their investment even if the borrower fails to settle the loan. Therefore, borrowers can obtain higher loans to finance important endeavors such as purchasing property, starting a business, or funding major projects.
• Diversification of Collateral: Collateral assignment offers flexibility for borrowers by allowing them to diversify their collateral base. While real estate is commonly used as collateral, borrowers can utilize other valuable assets such as investment portfolios, life insurance policies, or valuable personal belongings. This diversification allows borrowers to access financing without limiting themselves to a single asset, thereby preserving their financial flexibility.

Steps to Execute a Collateral Assignment

A collateral assignment is a financial procedure that involves utilizing an asset as security for a loan or other responsibilities. Below are the essential steps involved in the collateral assignment process.

• Assess the Need for Collateral Assignment. The initial step in collateral assignment is determining whether collateral is necessary. Lenders or creditors may require collateral to mitigate the risk of default or ensure repayment. Evaluating the value and marketability of the proposed collateral is crucial to ascertain if it meets the lender's requirements.
• Select Appropriate Collateral. The next step involves choosing a suitable asset for collateral assignment. Common classifications of collateral comprise stocks, real estate, bonds, cash deposits, and other valuable assets. The collateral's value should be sufficient to cover the loan amount or the obligation being secured.
• Understand Lawful and Regulatory Requirements. Before proceeding with collateral assignment, it is essential to comprehend the lawful and regulatory provisions specific to the jurisdiction where the transaction happens. Collateral assignment laws can vary, so seeking advice from legal professionals experienced in this area is advisable to ensure compliance.
• Negotiate Provisions. Once the collateral is recognized, the collateral assignment provisions must be negotiated among the concerned parties. It includes specifying the loan amount, interest rates, repayment terms, and any further duties or limitations associated with the collateral assignment.
• Prepare the Collateral Assignment Agreement. The collateral assignment agreement is a lawful document that typically includes details about the collateral, the loan or obligation being secured, and the rights and responsibilities of both parties. It is highly advised to engage the services of a legal specialist to prepare or review the contract.
• Enforce the Collateral Assignment Agreement. After completing the collateral assignment agreement, it must be executed by all involved parties. This step ensures that all necessary signatures are obtained and copies of the agreement are distributed to each individual for record-keeping objectives.
• Notify Relevant Parties. To ensure proper recognition and recording of the collateral assignment, it is important to notify all relevant parties. It may involve informing the lender or creditor, the custodian or holder of the collateral, and any other pertinent stakeholders. Sufficient documentation and communication will help prevent potential disputes or misunderstandings.
• Record the Collateral Assignment. Depending on the nature of the collateral, it may be necessary to record the collateral assignment with the appropriate government authority or registry. This step provides public notice of the assignment and establishes priority rights in case of multiple claims on the same collateral. Seeking guidance from legal professionals or relevant authorities can determine if recording the collateral assignment is required.
• Monitor and Maintain the Collateral. Throughout the collateral assignment term, it is crucial to monitor and maintain the value and condition of the collateral. This includes ensuring insurance coverage, property maintenance, and compliance with any ongoing obligations associated with the collateral. Regular communication between all parties involved is essential to address concerns or issues promptly.
• Terminate the Collateral Assignment. Once the loan or obligation secured by the collateral is fully satisfied, the collateral assignment can be terminated. This involves releasing the collateral from the assignment, updating relevant records, and notifying all parties involved. It is important to follow proper procedures to ensure the appropriate handling of the legal and financial aspects of the termination.

Key Terms for Collateral Assignments

• Security Interest: It is the legal right granted to a lender over the assigned collateral to protect their interests in case of borrower default.
• Collateral Valuation: The process of determining the worth or market value of the assigned collateral to assess its adequacy in securing the loan.
• Release of Collateral: The action taken by a lender to relinquish its claim over the assigned collateral after the borrower has fulfilled the loan obligations.
• Subordination Agreement : A legal document that establishes the priority of multiple creditors' claims over the same collateral, typically in the case of refinancing or additional loans.
• Lien : A legal claim or encumbrance on a property or asset, typically created through a collateral assignment, that allows a lender to seize and sell the collateral to recover the loan amount.

Final Thoughts on Collateral Assignments

A collateral assignment is a valuable instrument for borrowers and lenders in securing loans or obligations. It offers borrowers access to profitable terms and more extensive loan amounts while reducing the risk for lenders. Nevertheless, it is essential for borrowers to thoughtfully assess the terms and threats associated with collateral assignment before proceeding. Seeking professional guidance and understanding the contract can help ensure a successful and beneficial financial arrangement for all parties involved.

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Meet some of our Collateral Assignment Lawyers

Erdal Turnacioglu of Erdal Employment Law focuses on providing employment solutions to both employees and businesses, whether through litigation, review of employee handbooks, workplace investigations, or training seminars.

Charlton M.

Charlton Messer helps businesses and their owners with general counsel and contract drafting services. He has helped over 500 businesses with their legal needs across a variety of industries in nearly a decade of practice.

Dan "Dragan" I.

I received a bachelor’s degree in philosophy from Northwestern University in 1996 and then got my JD at University of Illinois College of Law in 1999. I have been a lawyer helping people with legal issues in the United States and Internationally since then. That includes litigation as well as contracts/transactions. I am also passionate about helping small and medium businesses with trademark registration and trademark-related legal projects. The law can be confusing and complicated for people, and I am passionate about providing professional legal services to my clients while simultaneously making the legal process less confusing and stressful for them. My goal is to help clients navigate through both good and difficult times by tailoring my skills, experience, and services to their specific needs. I am currently licensed and authorized to practice before the Illinois courts and the United States District Court for the Northern District of Illinois. Internationally I am one of a select few American attorneys licensed and authorized to practice before the United Nations ICTY/IRMCT, the International Criminal Court, and the State Court of Bosnia-Herzegovina. Clients have retained me internationally alongside local counsel in several European countries, Australia, and Africa in private legal matters. I have also been appointed by the United Nations to represent persons at the ICTY/IRMCT and chosen by indigent accused to represent them. Since 2009 my law firm has handled domestic and international cases, including Trial litigation (including Commercial, Premises Liability, Personal Injury, Criminal Defense, and General Litigation) and Transactional work (Contracts, Corporate formation, and Real Estate Transactions). I enjoy helping less experienced practitioners and students evolve and improve. I served as an instructor/lecturer on Oral Advocacy and Trial Practice for the participants of the ADC-ICT & ICLB Mock Trial since 2014, and have presented Advocacy Training lectures for the ADC-ICT on several topics as well as regularly lecturing to visiting University and Bar groups from around the world. If you or a loved one have a legal matter of importance, let's see if I can help you with it!

Current practice includes: employment law, family law, business law and personal injury.

I have been practicing law exclusively in the areas of business and real estate transactions since joining the profession in 2003. I began my career in the Corporate/Finance department of Sidley's Los Angeles office. I am presently a solo practitioner/freelancer, and service both business- and attorney-clients in those roles.

I am a New Mexico licensed attorney with many years of world experience in real estate, transactional law, social security disability law, immigration law, consumer law, and estate planning.

Brent has been in practice since 2007 and been the principal attorney and owner of The Walker Firm, LLC since 2014. Brent focuses on providing an array of general counsel services to individuals and companies in a variety of industries.

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Bears trade Justin Fields to Steelers for 2025 sixth-round pick that could become fourth-rounder

The former first-round pick has a new home.

Justin Fields has finally been traded. After months of speculation, the former Chicago Bears ' quarterback has been dealt to the Pittsburgh Steelers  for a 2025 sixth-round pick that goes to a fourth-round pick based on playtime. 

Fields' status in Chicago had been in doubt since the middle of the 2023 season, when rumors started to circulate about the Bears' longterm plans for him. In the end, the Bears ultimately decided to start over at quarterback while giving Fields a fresh opportunity with a new team. That team is the Steelers, who were one of six teams that enquired about Fields, according to ESPN . 

"Can't say thank you enough to the city of Chicago for taking me in and embracing me," Fields posted on X shortly after the trade was reported. "Thank you to the entire Bears organization and ownership for allowing me the opportunity to be part of such a historic franchise. 

"But most of all thank you to my all my brothers that I played with. You all were the reason I attacked each day the way I did. I can't thank you all enough for what y'all have meant to me over the last 3 years through the ups and downs. I wish each one of you nothing but success. Ready for this next chapter!"

In Pittsburgh, Fields will join forces with nine-time Pro Bowler Russell Wilson , who was signed this week just before the Steelers traded former starter Kenny Pickett to the Philadelphia Eagles . Wilson is penned as Pittsburgh's starter with Fields serving as his backup, via ESPN . 

Russell welcomed his new teammate to Pittsburgh, via "X.'' 

Let’s get it @justnfields ! QB room bout to be 🔥 🔥 🔥 pic.twitter.com/Vz4R7ZFArO — Russell Wilson (@DangeRussWilson) March 17, 2024

The trading of Fields all but guarantees that the Bears will select former USC quarterback Caleb Williams with the No. 1 overall pick. The Bears' next starting quarterback will have a pretty decent supporting cast around him, a group that includes wideouts Keenan Allen and DJ Moore , running back D'Andre Swift and tight end Gerald Everett . 

From a money standpoint, the Steelers are in an ideal situation at the quarterback position. Fields is entering the final year of his rookie contract and has a cap hit of just $3.2 million. 

Pittsburgh is expected to extend Wilson's contract next offseason, according to the Post-Gazette , which means that Fields will likely be free to test the open market next offseason. The Steelers could keep Fields, however, in the event that things don't go as planned with Wilson.  

The Steelers signed Wilson for just $1.21 million as the Broncos are paying him $39 million not to have him on their roster in 2024. Even with the acquisition of Fields, the Steelers still have the financial flexibility to add to their roster in free agency. Expect Pittsburgh to add another wideout to the equation via free agency sometime soon. 

Fields went 10-28 as the Bears' starting quarterback. While his record wasn't great, Fields nonetheless showed flashes of his potential that compelled Chicago to select him with the 11th overall pick in the 2021 NFL Draft . His completion percentage climbed during each of his three seasons with the Bears. In 2022, Fields recorded the second-highest rushing total for a quarterback in NFL history. Last season, he set career highs in completion percentage, passing yards and touchdown passes while throwing a career-low nine picks. 

In college, Fields enjoyed a prolific career at Ohio State. A two-year starter in Columbus, Fields led the Buckeyes to consecutive appearances in the College Football Playoff. His most iconic moment with the Buckeyes was his six-touchdown performance in Ohio State's 49-28 win over Clemson in the 2021 Sugar Bowl. 

Fields will look to further tap into his potential in Pittsburgh, who have completely turned over their quarterback room over the past month. 

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