After Acquired Title

Underwriting & Legal

After Acquired Title

June 13, 2018

What is the “after acquired property” rule?

It is a rule of law that can help us clear title in some situations. The rule applies to property that is “acquired after” someone has sold or mortgaged the property.

Andrew sells Blackacre to Carla but Andrew doesn’t own Blackacre. Clearly, Carla gets no title. Later, Andrew acquires Blackacre, whether through purchase, gift, or inheritance. At that moment, title to Blackacre vests in Carla. Because of the doctrine of after acquired title, Andrew is prevented from claiming that he owns Blackacre and that Carla does not. The warranty of title Andrew gave Carla operates to vest title in Carla.

There is no need for Carla to sue Andrew or to sue the source of Andrew’s title. The doctrine saves time and expense by negating the necessity of litigation in these situations.

All rules have their exceptions, so if you have a situation where you think the doctrine of after acquired property might apply, please contact WFG Underwriting.