Archive for the ‘Survey Problems’ Category

“Locating property lines without the assistance of a Surveyor” is a Bad Idea

I spend a significant portion of my energies warning people about this. It’s all I can do.

The Knoxville News Sentinel reports that the City of Oak Ridge is suing two men for $50,000 in damages for cutting trees that did not belong to them after they “located the property lines without the assistance of a surveyor.” That has got to be sobering. If they choose to contest, the trial costs alone will probably run $10,000 or more. Moreover, the law on this issue is very clear. The men have no legitimate defense.  They sure saved a lot of money by not hiring a surveyor.

Wrought Iron Fence

We recently completed this survey of a city lot in Knoxville. The decorative wrought iron fence in front was installed at a cost of $2,500. The previous owner guessed at the boundary. The fence on the left-hand side is five feet over. We came out when the neighbor informed the current owner of their belief that the fence was encroaching onto their property. An expensive error which could have been avoided.

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Taking Chances

I’m constantly amazed at the risks people take installing improvements near boundary lines. They spend thousands of dollars on fences or landscaping features with no clear knowledge of their property limits. Oftentimes things do not work out well. What is the cost to build this wall (pictured below)? How much to tear it down and build it again? The survey would have been cheaper, believe me.

On might think that the more affluent the neighborhood, the less likely things of this sort are to occur. Not true. We see boundary problems consistently across all income spectra. People everywhere take chances they should not. Another reason one should not buy property anywhere without a survey. You may well be inheriting the headaches and the accompanying liability of another. The famous line from Hill Street Blues comes to mind. “Let’s be careful out there.”

A Client Success Story

Our client had a scheduled closing within days but no property survey. He had inquired twice about getting a survey but the mortgage company kept insisting that “we don’t require it.” After hearing our radio ad, and my interview on the Hallerin Hill Show, our client began having serious doubts about closing without a survey. He called and asked if he could get a survey in time for closing. We rushed out to meet the client’s deadline.

At first blush, everything appeared to be in order with the property. However, I have warned about trusting occupation lines before. ‘Occupation lines’ consist of visible improvements, fences, hedges, trees, mowing, etc. which suggest claims of ownership. They can be very deceptive in that owners tend to rely on them as a kind of ‘boundary mythology’ while the true boundary lines may be very different from appearances.

This was the case here. Our client was very surprised at our survey findings. The results were so shocking that the seller let our buyer out of his contract. Thus, no closing took place. This occurs sometimes. Surveys kill closings. When this happens, it harms the bank, real estate agents, and the seller but the buyer is protected. What motive do any of these people have to look out for a buyer? The incentive to them is directly contrary to a buyers interests! Needless to say, our client was glad he opted for a survey before closing. The buyer has moved on to another property. This time there is no question. We are surveying the new property in a few days.

People are closing daily on properties without benefit of a survey because other parties to the transaction discourage it. Please don’t do it. Exercise appropriate due diligence by getting a survey.

The drawing below shows the occupation lines in green. The bold black lines are the actual property boundary. The house sits unexpectedly askew to the true boundary. A small building and most of the driveway is over the property line.
Oakland Drive Survey, occupation lines in green

Don’t let your addition become a subtraction

Work stopped by City at footer stage

Work stopped by City at footer stage

Adding new space to your existing house may be a great idea. However, knowing exactly where your property boundaries and relevant setback lines are located is an essential part of planning for a new addition to any home. Do not just guess. The outcome of such a decision may not be desirable.

We have encountered two instances recently where the owners and contractors did just that. In both instances, city or county officials stopped work on the projects. In Example 1, the existing house was already in violation of the setback, but the city agreed to allow the addition to come as close to the sideline as the pre-existing house. The footer had to be re-dug about two feet further from the property line. The entire addition was shifted over.

Unfortunately, in Example 2 (picture shown) the work stoppage came quite late in the building process. The new addition is very close to the property line (2.5 feet), violating a building setback line as well as a five-foot utility and drainage easement. The home owner is now completely at the mercy of zoning and planning authorities. It remains to be seen whether a variance will be granted or whether the homeowner will be forced to buy adjacent property. In extreme cases, the zoning authorities may require the offending portion of the dwelling to be removed. We are awaiting the verdict of officials now. Either way, the project is subject to long delays and additional unforeseen costs. Even if a variance is granted, who wants their house to have a 2.5 foot side-yard? I imagine that condition may be a deterrent to future buyers as well.

Take care. Plan ahead. Do the due diligence of getting a survey and save yourself a lot of headaches.

Work stopped at approximately 50% completion

Work stopped at approximately 50% completion

Addition shown in Example 2

Addition shown in Example 2

Tales From the Archives

Loss of Deed Area

Loss of Deed Area

The 2003 survey at left shows a significant loss of area (about 3.7 acres out of 15) compared to that called for in the deed. The loss of area is shown in red. The previous surveyor was incompetent, causing an enormous overlap with adjacent properties.

The driveway used for access has no legal easement or right-of-way. The adjacent owners could challenge its use.

The wire fence at the southern end of the property does not follow the actual boundary.

You never know what kind of problems a good survey might uncover. Would you buy this? Would you pay the same money originally offered? What if you bought without benefit of a survey?

Who looks out for your interests when buying real estate?

Let’s examine the possibilities, then take them one at a time:

  1. Realtor
  2. Title Company
  3. Mortgage Company/Bank
  4. Seller
  5. Builder

Let me say at the outset that all of these interested parties have one thing in common: If there is no closing, they do not get paid. Therefore their primary interest will typically be to see that a closing happens as easily and as quickly as possible. This causes an automatic conflict of interest with the buyer of real estate. Buying real estate is a huge investment that should entail the utmost care and performance of due diligence on the part of the buyer. Rushing the process may lead to mistakes. The buyer owes it to himself to obtain as much information as possible prior to closing. If something is missed, it is the buyer who will be harmed and the only one left holding the bag after everyone else has moved on down the road. I cannot stress this enough. I have seen example after example. If problems are uncovered prior to closing by a surveyor or home inspector for instance, the buyer still has negotiating leverage. If problems remain hidden until after closing the buyer has relinquished any leverage he or she may have had.

1. Realtor

Real estate agents are subject to something called the ‘laws of agency.” The prevailing practice, at the time a buyer and seller come together, is for the real estate agent to become a ‘dual agent‘ representing both buyer and seller. The agent is then bound to remain neutral. Exceptions occur if the real estate agent is a close friend or has some special relationship with one party. In such a case the agent may only represent the party with whom they have the preexisting relationship. Another exception occurs if a buyer has retained a real estate agent specifically as a ‘buyer’s agent.’ Having a buyer’s agent is obviously the best case scenario for the purchaser. Many people are completely unaware of the laws of agency and choose to ‘coast’ through the process. As with any profession, some agents are better than others. It is important to choose an agent whom you trust. A responsible buyer’s agent will recommend getting a land survey, home inspection, environmental assessment, or other acts of due diligence. It is still worth remembering that, if there is no closing, neither buying nor listing agent gets paid. This fact may tend to influence partiality. Ultimately you must rely on the personal integrity of the agent. Choose wisely.

Unfortunately I have experienced countless incidents where a homeowner was upset about the actual location of property boundaries (found by survey after closing, sometimes years later) because the “Realtor told them” that the boundaries were elsewhere. This happens so often that it is a running joke among surveyors. Bluntly, if a real estate agent starts explaining to you the property boundary locations without benefit of a professional surveyor, find another agent.

2. Title Company

The title company does the deed research or ‘abstract of title’ necessary to warrant ‘good and clear title’ and to enable the title insurance company to insure against defects in the title. Remember that there are lender’s policies and buyer’s policies. You may want to consult with a title attorney to see if it is in your best interests to obtain a buyer’s policy. Otherwise it is likely that only a lender’s policy will be written.

Note that any defects found in the title are written as ‘exceptions’ to the policy. This means that those items that are defective are specifically excluded from the policy, unless they are cleared up. Also note that title insurance will not protect the buyer against adverse claims that could have been discovered as the result of a land survey. This is called the ‘survey exception.’ You are dealing with the collective knowledge of thousands of attorneys with years of experience. They are very good at protecting themselves through the use of disclaimers. The liability for these exceptions passes to THE BUYER.

I like this line: “Title insurance companies don’t assume risk; rather, they are in the risk elimination business…”

Years ago surveys were required as a part of every real estate transaction. This is no longer the case. The closing process is now ‘streamlined’ to make it easier and faster for banks and mortgage companies to maximize profits. Surveys tend to uncover problems. Problems cause delays and perhaps even kill the closing. It is far more convenient (for them) to kill the survey requirement instead.

3. Mortgage Company/Bank

See number two above. The bank or mortgage company are in the business of getting you on the hook for a long term loan. Your best interests are not the primary objective. They protect themselves by getting title insurance and using disclaimers. They too are attorney-rich.

4. Seller

There is not a lot to say here. Buyers instinctively know that they are in an adversarial relationship with the seller in any transaction. The seller wants to maximize his profits and the buyer wants to minimize them. This is a fact of life in the most amicable transactions.

A brief word about property lines is in order. Sellers many times advise buyers about the extents of the property they are selling. The seller is often wrong. A wise buyer will not rely on the word of the seller regarding the property boundaries. It is not that they are intentionally deceptive, rather they may be incorrectly convinced in their own minds about the boundary locations. Don’t let the seller’s incorrect assumptions become your loss.

5. Builder

Even the best builders make mistakes. We recently encountered a situation where a very good contractor built a wood fence with nice brick columns spaced every ten feet or so around the back yard. He make a faulty judgment about the boundaries and built part of the fence four feet over the line. We discovered it when a buyer ordered a survey after the house was completed.

The nature of the fence meant that moving even a portion of it was quite expensive. Several brick columns had to be destroyed and rebuilt. I recall the cost was about $5,000. The buyer was able to force the seller to correct the problem. Had the buyer not spent a few hundred dollars on a survey, he would have been stuck with a $5,000 liability.

Conclusion

It is up to the informed buyer to protect his or her own interests. Getting a survey should be considered essential due diligence. Don’t be blindsided by these problems. In most cases, if you are short on cash, the cost of the survey can be financed into the loan.

Don’t just take my word, here are some related third-party articles:

Property Survey: Why All Buyers Should Have One

Financial Adviser Dave Ramsey says get a survey

As always, this writing expresses my opinion and does not constitute legal advice. Those seeking legal advise need to get an attorney.

Tales from the Archives

Culvert installed under house

Culvert installed under house

This is another interesting survey from the archives. Names have been changed to protect the guilty.

Construction of the residence pictured above was just completed. The house was located in a modern new subdivision. The proud future owners were looking forward to closing in just a few days when we were contracted to do a land survey.

While performing the survey, we discovered that a 36 inch corrugated metal pipe was running straight underneath the foundation as indicated by the blue shaded area in the graphic. We were later informed as to what occurred. The design plans called for the storm culvert to be installed along the northwest property line, then turn down the southwest property line to the headwall as indicated by the shaded red area. However, the grading contractor had decided that the design route was too circuitous and that he could save a fair amount of money on pipe by following a more direct route straight through the lot. It apparently did not occur to him that an active metal culvert with water flowing underneath the foundation could cause potential structural problems.

Upon discovery of the problem, we delivered our findings to a shocked and dismayed buyer and mortgage company (not to mention the real estate agent and the homebuilder). The buyer called me and asked what I would do if I were in their shoes. Being honest, I told them I would not buy the house. They were really set on the house though, so I advised them to get assurances from geotechnical and structural engineers that the foundation would be stable. The engineer required the culvert to be cut and the ends sealed. A new culvert was properly installed in approximately the correct area as represented by the red shading. I say “approximately” because the culvert is supposed to be wholly located within the designated 20 foot drainage easement as indicated by the shaded green area. As you can see, it is not.

I do not say this by way of bragging – it is the plain truth. Most surveying companies would never have caught this. Too many surveyors perform hurried, cursory land surveys which do not indicate all the improvements. We caught the problem by being thorough. The buyers could have just as well bought the property with the problem undiscovered until years later.

One other alarming aspect of the problem is its now invisible nature. Subsequent buyers must always rely on the honesty of previous owners to disclose the problem. If the chain of disclosure is broken, the circumstance will remain unknown. The law says that sellers must disclose any known defects to potential buyers, but it must be tempting to remain silent considering the adverse effect this knowledge could have on offers.

The moral of the story is this:

It does not matter if the construction or the neighborhood is new or old – never, never buy property without a land survey. It is a risk too great to take considering the cost of land and construction.

Occupation lines are deceptive (Don't believe your eyes)

Fences & Occupation lines

Fences & Occupation lines

Possession lines can be deceptive. ‘Possession lines’ refer to mowing, hedges, fences and

Actual Boundaries

Actual Boundaries

other signs of occupation habitually created by property owners over a period of time.

Shown is an actual survey from our file. Ironically, the name of the road is Sunny Lane. All is peaceful. There is a nicely manicured yard inside a chain link fence which surrounds the property (See Figure 1 left – clicking will enlarge). There are no apparent disputes.

The property owner orders a survey, the results of which are shown at right (Figure 2). All is not sunny on Sunny Lane. Note that the adjacent house to the south is almost wholly located on the subject lot.

Here is one more good reason to obtain a survey when buying property. Do not trust your eyes and remember - Title Insurance does not protect the buyer against defects that could have been found by obtaining an accurate survey.

Fence lines and property boundaries


Fence 27ft off boundary

Fence 27ft off boundary

Property owners sometimes mistakenly assume that an existing fence is the same as the property line. They are shocked to discover that the fence in question may be many feet in error when a survey is performed.

Unless the subject deed specifically refers to following a fence a competent land surveyor will consider the fence to be low in the evidence chain in comparison to other more favorable evidence called for in the deed. If the subject deed contains such language as “thence with a fence”, “along a fence” or “following a fence” then it is a safe bet that the fence is the property line if the fence in question is the original fence called for in the conveyance. Otherwise, the surveyor must follow the explicit instructions contained in the deed while ignoring the fence, unless the fence is the only remaining evidence of the boundary.

This scenario is especially problematic when a purchaser has acquired a piece of property under the assumption that the fence is “obviously” the boundary therefore they believe no property survey is needed.

Warning: Never take the word of a real estate agent or an existing property owner about where the boundaries lie.

The former should never be giving advice relative to property boundaries in the first place. If a real estate agent describes the land boundaries to you, then it is time to find another agent. The only advice they are qualified to give is to instruct one to hire a competent professional surveyor to locate the property boundaries. I have encountered countless property owners who have exclaimed “But the real estate agent told me (fill in the blank)!” only to find out they were misled. This is very much a violation of state standards of practice issued by the Tennessee Real Estate Commission.

The existing property owner is rarely intentionally deceptive, but is often mistaken about where the boundaries lie unless they have had the property recently surveyed. Lines of occupation often differ from actual boundaries.

When purchasing real estate, a good survey should be considered essential. Unknown problems such as disputes, adverse claims or encroachments may arise months or years later. If they do, Title Insurance will not help. Title Insurance does not protect the buyer against defects that could have been found by obtaining an accurate survey.

Click here for an interesting court case where a land surveyor was found to be negligent because he surveyed to an existing fence line while ignoring the deed calls. A few pertinent quotes from the case:

Meandering fence

Meandering fence

“Although the fence was not mentioned in any description of record, and had a “bow” in it, it showed signs of such antiquity that [the surveyor] concluded that it had been accepted as a boundary…”

“The extension of the fence line on which [the surveyor] relied, being neither marked nor surveyed, and being unrelated to any monument described of record, fails to meet the criteria of ‘artificial monuments and established lines, marked or surveyed’…”

“The recorded distance should have prevailed.”

“We conclude that [the surveyor] was negligent as a matter of law…”

While it is certainly the surveyor’s duty to locate and describe fences near the boundary, the two do not necessarily coincide.

*Note: Adverse possession is a special case not addressed here. Even if adverse possession is relevant to a particular case, this is a determination that cannot be made by a surveyor. The surveyor shows the location of record boundaries and lines of occupation to the best of his ability. Only courts can decide the location of actual property rights in an adverse possession dispute.

More information about adverse possession.

This writing is the opinion of the author. Nothing herein constitutes legal advice. Anyone seeking legal advice is advised to seek out a competent attorney.