Brief Fact Summary. Plaintiffs brought suit for specific performance. Defendants claimed that the title to the land was unmerchantable because Plaintiffs claimed a portion of the land through adverse possession.
Synopsis of Rule of Law. Owning land via adverse possession does not make title to the land unmarketable or unmerchantable.
In order to reach this result the court must conclude (1) that the outstanding claimants could not succeed were they in fact to assert a claim, and (2) that there is no real likelihood that any claim will ever be asserted.View Full Point of Law
Issue. Whether the Plaintiffs were able to offer a marketable title for sale when a portion of the property in question was claimed by adverse possession.
Held. Reversed. The Plaintiffs must first demonstrate that the portion of the land claimed by adverse possession is lawfully theirs, prior to a determination being made on whether title is marketable.
The law will imply that a title must be marketable, even when the contract is silent upon that point. The law will not imply that the title must be perfect by record, unless the contract expressly provides for it.
Title will be marketable even if a portion of the land is claimed by adverse possession.
Discussion. The court discussed that the primary flaw in the decisions of the lower courts was they did not make a determination, nor did the Plaintiffs offer any proof, that the tract of land in question was lawfully obtained by adverse possession. The court ruled that land held by adverse possession does not make the title unmarketable, rather the owner claiming land by adverse possession had to demonstrate that he or she had met the requirements under state law to be deemed owners by adverse possession. After the Plaintiffs made this showing, they could go forward and sue for specific performance.