November 2011 Vol. 4, No. 10

Real Estate and Title Insurance News

Deed Reformation

Corrective Deeds: When Will Illinois Courts Reform a Deed in Illinois?
by Patrick Hicks, ATG Law Clerk


A deed for the conveyance of land is a simple instrument in Illinois. There are only four elements required to have a valid deed: the name of a grantor; the name of a grantee; a description of the interest to be conveyed; and the signature of the grantor. Yet parties make mistakes in deeds all the time. Names are left off, signatures are forgotten, and legal descriptions are incomplete or incorrect. Sometimes these mistakes are unfortunate clerical blunders, called scrivener's errors in the legal world. Sometimes there are fundamental misunderstandings between parties, such as when the sellers thinks they are conveying a few acres of land but the buyers thinks they are getting the entire estate. No matter how minor the mistake on the deed, the consequences potentially can be enormously costly. In extreme cases, judgments of millions of dollars can depend on whether a court allows a deed to be corrected or declares the entire conveyance invalid because of the mistake. Courts in Illinois take different approaches to how and when a deed may be reformed because of a mistake, depending on the nature of the error. This article will examine the elements of a deed in Illinois, examples of the types of mistakes grantors and grantees make, and how courts deal with these mistakes.

Elements of a Deed

In the early history of Illinois, deeds were often complex and confusing. There was no consistent form for a deed, and the rules of what a deed required were cobbled together from the common law. The Illinois Conveyances Act, first passed in 1827, sought to simplify and standardize deeds. 765 Ill Comp Stat Ann 5/0.01 et seq. The Illinois legislature laid out the required elements for a valid deed by adopting a statutory short form to be used in conveyances. 765 ILCS 5/9. The short form contained four elements that courts have interpreted to be essential in creating a valid deed: the name of the grantor; the name of a grantee; a legal description of the interest in property conveyed; and the signature of the grantor or grantors.

Three of the four requirements from the Conveyances Act are codification of the common law. The general common law rule was, "in every grant there must be a grantee, a grantor, and a thing granted."Herrick v Lain, 375 Ill 569, 32 NE2d 154 (Ill, 1941), citingDuffield v Duffield, 268 Ill 29, 108 NE 673, 675 (Ill, 1915). See also 2 Blackstone's Com 96. The Conveyances Act adds to these three elements the requirement of a signature of the grantor. Courts have reiterated that the signature is necessary for the validity of a deed.Chicago Land Clearance Comm v Yablong, 20 Ill 2d 204, 170 NE2d 145 (Ill, 1960).

If a deed has these four elements, courts will uphold the conveyance as they would any other contract, even if circumstances surrounding the conveyance may seem unfair. InDurbin v Bennett, a federal district court in Illinois (applying Illinois law) held that a deed conveying mineral rights to a property was valid because all of the required elements were present, even though the deed had been "procure[d] from indigent and illiterate grantors, for a nominal consideration."Durbin v Bennett, 31 F Supp 24 (Ill Dist Ct, 1939). The court found that the grantees might have taken advantage of the grantors, an 80-year-old, poor, illiterate man, and his daughter, but there was no fraud involved. The grantors were not mistaken about what they were conveying; they simply made a bad bargain. Thus, the court could not cancel the deed. If the required elements of a deed are present, a court will reform or cancel the conveyance only if mistakes have been made.

Common Mistakes in Deeds

Despite the seeming simplicity of a deed, several common mistakes regularly appear before Illinois courts. There are mistakes regarding the elements of the deed&€”a name, description, or signature omitted. There are times when someone in a secretarial position makes a scrivener's error&¬&€”a typo, misspelling, or other small mistake in the drafting of the deed. Similar to a scrivener's error, often there are mix-ups with the Property Index Number (PIN). In Illinois, every piece of land has a number assigned to it for tax purposes, which is often included in the legal description when the property is conveyed. Courts face the dilemma of how to interpret the deed when the PIN does not match the actual property. Perhaps the most frequent mistake that pulls parties into court over a deed is a mistake in the legal description. Drafters make legal description mistakes in a variety of ways, from improperly measuring acreage to failing to "close" the boundaries of the property. When legal disputes arise over these mistakes, courts must then decide whether the deeds can be corrected or if the conveyance must be cancelled.

Elemental Errors

A deed must contain the names of the grantor and the grantee. If a deed leaves a name off and there is no other information about who the grantor or grantee is, then "the law is well settled" that this defect would be fatal to the deed.Richey v Sinclair, 167 Ill 184, 47 NE 364 (Ill, 1897). However, reformation of the deed would be proper if the deed contained the names but they were merely in the wrong place. The Illinois statutory short form has the grantor's name going first, but reversing the order of the names is not enough to vitiate the deed.Beaver v Slander, 94 Ill 177 (Ill, 1879).

The signature of the grantor is also a vital element of the deed, although the intent is more important than the form. The signature need not be the grantor's name, it could be a symbol recognized as the grantor's mark. In the 19th century when many property owners were illiterate, an X would suffice as a grantor's signature.

A signature is also valid if someone else guides the hand of the grantor to make it. This was the subject of a dispute inWitt v Panek, 408 Ill 328, 97 NE2d 283 (Ill, 1951). Michael Witt had died leaving seven children as his heirs at law. However, one of the children, who had lived with Witt and taken care of him in the years before his death, claimed that Witt had conveyed his home to her before he died. The other children disputed the deed and argued that the signature on it was a forgery. The daughter with the deed, Panek, claimed that one of her other brothers had helped guide Witt's hand in signing the deed and it was therefore a valid conveyance. At trial, each side brought in handwriting experts. One side's expert testified that two people made the signature, "a firm hand guiding a shaky hand" and it was not an attempted forgery. The other side's expert testified that only one person, with a firm hand merely trying to appear shaky, had made the signature. The court held that the latter testimony was not enough to prove that the signature was forged. Furthermore, it went on to hold that guiding the grantor's hand to form a signature was enough to make the deed valid, because it is not the signature itself but rather "the disposing capacity and the act of mind which are essential and efficient ingredients of the deed." It is clear that there must be something on the deed to represent this intent, and that if no signature of any kind is present, the deed is invalid.

Scrivener's errors
In legal documents, where the preciseness of language is crucial, even a small error can have the potential for tremendous consequences. A scrivener's error is a "minor mistake or inadvertence" made in a document. Black's Law Dictionary 563 (West 7th Ed., 1999). Typos, misspellings, omissions, and accidental inclusions and "boundless" other examples, fall under this category.

Fritzsche v Union Pacific Railroad Cois another case in which millions of dollars hinged on a scrivener's error.Fritzsche v Union Pacific Railroad Co, 303 Ill App 3d 276, 707 NE2d 721, 236 Ill Dec 594 (5th D, 1999). Carol Fritzsche was killed when she was driving across a railroad track and a train struck her car. Fritzsche had been drinking and an autopsy revealed that her blood alcohol content was three times the legal limit. However, the train was traveling at excessive speed, it failed to sound its horn as it approached the crossing, and the conditions of the crossing created the potential for danger. Fritzsche had been driving along a road that was part of her property. In 1903, the railroad had contracted with the then-owners of the land for a right of way. As part of that covenant, the railroad agreed to maintain the area of the right away. Critically, it agreed to maintain the grade of the road crossing the track. At the time of Fritzsche's death, the area in which she crossed the track had a dangerously steep grade that may have prevented her from seeing if a train was coming.

The Fritzsche estate nearly lost the wrongful death suit, however, because of a scrivener's error. The warranty deed between the railroad and the landowners included the covenant that the defendant had to maintain the approach to the private crossing at "a grade of not less than 8%." At trial, the plaintiff produced an expert who testified that this language must have been an error. The purpose of the covenant, as stated in the deed, was to "permit the easy passing of teams." The original landowners wanted to make sure they would be able to lead packs of mules across the track. Because mules would have a hard time pulling a load up a grade steeper than 8%, standard practice was to require the railroads to keep the grade atless than8%. The Fritzsche's deed said the opposite. The expert insisted that the deed should have read "not more than 8%."

If the court did not allow the deed to be reformed, Fritzsche's case against the railroad would have been significantly weakened. Luckily for Fritzsche, the court agreed that there was a mutual mistake in the formation of the deed and allowed reformation. The railroad was forced to pay $3,225,000 to the estate. Not all scriveners' errors are as potentially costly, but this example highlights the importance of careful drafting by the grantor and a cautious reading by the grantee.

Description problems
Perhaps the most common problem with a deed that could render it invalid is a mistake in the legal description.

The facts of theDepartment of Conservation v Nevois234 Ill App 3d 227, 600 NE2d 91, Ill Dec 468 (5th D, 1992), read like a logic game that has to be diagrammed to be fully understood. The case concerned a farm that was divided into six tracts, which the trial court sorted out by naming after colors: Yellow, Green, Pink, Blue, Orange and Brown. The six parcels were originally owned by Lucy Blow, who gave the Green and Yellow parcels to her daughter, Augusta Nevois. After Lucy Blow's death, the remaining four parcels were left to Nevois and her brother Edgar Blow as joint tenants. Then Edgar Blow quitclaimed his interest in the Pink parcel to Nevois and she gave up her interest in the other three. At this point, each sibling owned three parcels — Green, Yellow, and Pink for Nevois; Blue, Orange and Brown for Edgar. Years later, Edgar decided to sell his half of the land to the Department of Conservation of the State of Illinois. Then the Department entered into negotiations with Nevois to purchase the Green and Pink parcels. During these negotiations, Nevois offered to sell the Blue parcel to the Department as well. The problem was the Department thought it already owned the Blue parcel from its purchase from Edgar.

Due to the disputed ownership of the Blue parcel, negotiations broke down and the Department decided to take the Green and Pink parcels through eminent domain. In the litigation, Nevois asked for a determination from the court of who owned the Blue parcel. Nevois claimed that if she did give the Blue parcel to Edgar it was by mistake and the deed should be reformed. The trial court agreed but the appellate court reversed.

Nevois and Edgar Blow argued that when they transacted to split up the farm they had inherited from their mother, the Blue parcel was intended to go to Nevois. Unfortunately, they did not have any witnesses to testify to this intent except for themselves and their respective spouses. Countering their assertion was the documentary evidence that showed Edgar did own the Blue parcel. And, as the court pointed out, in the transaction between Edgar and the Department to sell Edgar's half of the land, all of the documents referred to three separate parcels, not two. The court asked, "If Edgar Blow did not realize that the third tract was the Blue Parcel, which it was, what, then, did he believe he was selling?" If Nevois' argument had been successful, it would have been a creative way to get around losing their land. But the court refused to reform the deed when any evidence for mutual mistake was all but absent.

Mental capacity
Mental incapacity can lead to a mutual mistake in a deed.Smith v Love, 286 Ill 570, 122 NE2d 136 (Ill, 1919), was a case dealing with a deed signed by a man named Andrew Smith, who had suffered a stroke and endured brain damage. The court described Smith in colorful, if not politically correct, terms. "[H]e had softening of the brain," the court wrote. "He was crazy as a loon." The court also described some of Smith's more erratic behavior, such as pouring coffee on a plate and then trying to eat it with a fork. Smith exhibited other behaviors, which "indicated a state of imbecility." Although there were witnesses who testified that Smith had moments of clarity, the court ultimately held that he was mentally incapable of executing a valid deed.

Selling the wrong land
Often when mutual mistakes are made, there is no solution that does not result in both sides losing. InBiren v Kluver, 35 Ill App 3d 342, 342 NE2d 325 (2nd D, 1976), a landowner, Biren, agreed to sell a plot of land to Kluver that he described as "120 acres more or less" for $12,000. The &€˜more or less' turned out to be a lot more, and Kluver thought he was getting a great bargain by paying only $12,000 for a large tract of woods. When the paperwork was signed, Biren claimed that his eyesight was too poor to read the legal description, but he felt he had made it clear that he only wanted to sell 120 acres for $100 per acre. Kluver, on the other hand, argued that the agreement had been $12,000 for the entire property, regardless of Biren's oral estimate. According to Kluver, Biren had told him and his business partners, "Boys, you are buying all of the timber land west of the Galena-Blanding Road." The purchase offer said &€˜120 A. for $12,000.' The court held that Biren had in fact been mistaken about how much property he had meant to sell and allowed the deed to be reformed. But it also held that Kluver was entitled to all of the property. To resolve this dispute they gave Kluver the entire tract of land but made him pay the full price of $100 per acre. Biren lost the land he did not want to sell, and Kluver had to pay more than he wanted to spend.

Selling land unintentionally is a surprisingly frequent mistake when executing deeds. Another example isWheeler-Dealer, Ltd v Christ, 379 Ill App 3d 864, 885 NE2d 350, 319 Ill Dec 79 (1st D, 2008). InWheeler-Dealer, a corporation sought reformation of a deed after it accidently sold an entire plot of land when it had only meant to sell 165 feet of it. The defendant, Christ, purchased a piece of property, referred to by the Court as "Lot 4," at 12531 S. Vincennes in Blue Island, Illinois, at an auction. The auctioneer made no mention of the fact that the seller, Wheeler-Dealer, intended to only sell the east 165 feet of the property. Then, Wheeler-Dealer's lawyer, David R. Gray, Jr., drafted a deed in which he mistakenly conveyed all of Lot 4 to Christ. Gray blamed the error on his "cut and paste" method of drafting. He had just copied the language of the original deed, which conveyed Lot 4 to Wheeler-Dealer, and forgot to change it to only the intended 165 feet of land. The mistake was compounded when Christ's lawyer called to verify the legal description provided by Gray, and Gray's summer law clerk confirmed that it was correct. Wheeler-Dealer went to court arguing that the deed should be reformed because of a mutual mistake. However, it only had its own assertions of its intent; Christ had a written document. The Court found in favor of Christ. The portion of land that Wheeler-Dealer intended to sell was a small strip of land with a garage on it, but because of these mistakes, it ended up selling someone's house.

Principles of Reformation

What happens when mistakes like those examined above occur? Courts use several principles to guide them in determining whether reformation of a deed is the appropriate remedy. Reformation is when a court "will modify a written agreement to reflect the actual intent of the parties." Black's Law Dictionary 1285 (West 7th Ed 1999). This equitable remedy is not designed to unfetter parties from their bad bargains, but can be used to resolve errors in a deed without voiding it. "The basis for reformation is an understanding between the parties. What is sought to be reformed is not this understanding, but rather an instrument which inaccurately reflects it."Harden v Desideri, 20 Ill App 3d 590, 596, 315 NE2d 235 (1st D, 1974). The difficulty comes in judging what the actual intent was when two parties argue opposite intentions. The general rule is that intent is found only within the four corners of the deed. A court will only look at what is contained in the deed and will not look at extrinsic evidence except in certain circumstances.

If the true intention of the parties is not reflected in the four corners of the deed, then a party must meet five elements in order to have a cause of action for reformation. "[T]he complaining party must allege (1) the existence and substance of an agreement between the parties and the identity of the parties to that agreement; (2) that the parties agreed to reduce their agreement to writing; (3) the substance of the written agreement; (4) that a variance exists between the parties' original agreement and the writing; and (5) the basis for reformation (e.g., mutual mistake)."Schaffner v 514 West Grant Place Condominium Ass'n Inc, 324 Ill App 3d 1033, 756 NE2d 854, 258 Ill Dec 580 (1st D, 2001).

When can extrinsic evidence be admitted: Parol Evidence Rule
Whether to allow extrinsic evidence to interpret deeds is based on the parol evidence rule. This rule is designed to "preclude evidence of understandings not reflected in the contract, reached before or at the time of the execution which would vary or modify its terms."WW Vincent & Co v First Colony Life Insurance Co, 351 Ill App 3d 752, 757—758, 814 NE2d 960, 286 Ill Dec 734, (1st D, 2004). The rationale is that once an agreement has been formalized in writing, any oral negotiations made beforehand are superseded. However, the parol evidence rule does not apply in cases of mutual mistake. A mutual mistake is "one that is common to the parties such that each labors under the same misconception. In such a case, the parties are in actual agreement, but the instrument to be reformed, in its present form, does not express the parties' real intent."Wheeler-Dealer, 379 Ill App 3d at 869. See alsoBank of Naperville v Holz, 86 Ill App 3d 533, 538, 407 NE2d 1102, 41 Ill Dec 604 (2nd D, 1980). The appellate court of Illinois has stated that this exception to the parol evidence rule is "well established" in the state.First Health Group Corp v Ruddick, 393 Ill App 3d 40, 911 NE2d 1201, 331 Ill Dec 971 (1st D, 2009). If one party alleges a mutual mistake, then outside evidence is allowable to show the true intent of the parties.

The Illinois appellate court has also held that the mistake need only be alleged for the exception to apply. InRuddick, the plaintiff tried to argue that the defendant should not have been allowed to admit parol evidence because there was no actual mistake. The court quipped, "this argument puts the cart before the horse." If admitting extrinsic evidence of a mistake is the only way to prove that there was a mistake, then parol evidence must be allowed to demonstrate the true intent of the parties.

Generally, the mistake must be mutual for reformation to be proper. A unilateral mistake by one party will not allow them to get out of the agreement. But if there is an allegation of fraud, parol evidence may be introduced and a party may be able to prove that reformation should be a remedy. "The instrument may also be reformed upon proof of a mistake by one party to the contract when the other party knows of the mistake and fails to inform the other party or conceals the truth from him."Biren, 35 Ill App 3d at 696.

A deed may also be reformed because of a scrivener's error if the court feels that the error did not reflect the intent of the parties. "The power and authority of a court of equity to correct the mistakes of a scrivener incorporated into a contract, deed, or other instrument is well known."Reinberg v Heiby, 404 Ill 247, 255, 88 NE2d 848 (Ill, 1949). Having this power allows courts like theFritzschecourt to reach an equitable result. Without this rule, Fritzsche's estate would have been prevented from collecting in the wrongful death suit because of a century old typo. Such an unfair result would be contrary to the purpose of reformation.

Types of parol evidence
There are several kinds of parol evidence that may be admitted to prove that a mutual mistake was made. An oral agreement between the parties can sometimes be admitted. For example, if a boundary line in a deed is disputed, a party can introduce evidence that there was an oral agreement establishing the line. "The owners of adjoining lands may, by parol agreement, when fairly entered into, settle and establish the boundary line between their lands, which, when followed by possession to the line thus established, will be binding upon them and their privies."Sheetz v Sweeney, 136 Ill 336, 341—342, 26 NE 648 (Ill, 1891).

Other written documentation is also used often, especially in cases in which a deed is ambiguous. Without ambiguity "a deed speaks for itself and its construction is dependent upon the language used."Roots v Uppole, 81 Ill App 3d 68, 70—71, 400 NE 2d 1003, 36 Ill Dec 423 (3rd D, 1980). But if it is not possible to correctly ascertain the intent of the parties because the deed is unclear, outside evidence of intent is permissible. Often ambiguity in a deed can be found in the legal description. A common problem is when the deed describes land that does not "close." For example, if a piece of land is a square and the legal description only gives the boundaries of three sides. If it is not clear how the fourth boundary line is to be drawn, then a court can look at outside evidence to resolve the confusion created by the deed. It may do this by looking at other documentation. For example, if a description does not close, the court can look at past conveyances of the same property because "there is a presumption that a grantor in executing a deed intended to convey only property which he owned." If this exception to the parol evidence rule was not allowed then many conveyances would have to be unnecessarily voided because of minor, easily correctable mistakes.

Clear and convincing evidence standard
The party attempting to prove that a deed does not reflect the actual intent of the parties must do so by clear and convincing evidence. To make out aprima faciecase for reformation, the party must show "the mistake is one of fact rather than law, the proof clearly and convincingly shows a mistake was made, and the mistake was mutual and common to both parties to the instrument."Idat 72. See e.g.,Skelly v Ersch, 305 Ill 126, 137 NE 106 (1922). This burden of proof in a reformation action is a higher burden than a party would carry in a regular civil suit.Farmer City State Bank v Guingrich, 139 Ill App 3d 416, 427, 487 NE2d 758, 765, 94 Ill Dec 1, 8 (4th D, 1985). Courts have further attempted to refine what this standard means. One court said that the evidence must be "such as will strike all minds alike as being unquestionable and free from reasonable doubt. The remedy and reformation on account of an alleged mistake is never granted upon a probability, nor upon a mere preponderance of the evidence, but only upon evidence amounting to a certainty."David v Schiltz, 415 Ill 545, 114 NE2d 691 (Ill, 1953), citingChrist v Rake, 287 Ill 619, 122 NE 854 (Ill, 1919).

Both parties do not have to agree that a mutual mistake was made. One party clearly would have an incentive to argue that there was no mutual mistake; otherwise, the issue likely would not have been litigated in the first place. But if the evidence successfully shows that there was a mutual mistake at the time the deed was executed and "that at that particular time the parties intended to say a certain thing and by mistake of fact expressed another," the deed will be reformed.Matthews v Whitethorn, 220 Ill 36, 77 NE 89 (Ill, 1906).

Bona fide purchasers
A court will not reform a deed, even if there is mutual mistake, against a subsequentbona fidepurchaser. Courts have held that it would not be equitable to reform deeds in these circumstances, if abona fidepurchaser for value had "no notice of the mistake or of facts which should put them on inquiry."Nevois, 234 Ill App 3d at 231. However, the purchaser cannot have had notice of the mistake at the time of purchase. If the purchaser had actual notice, or constructive notice that makes the purchaser "chargeable for knowledge which imposes upon such purchaser the duty of inquiry," then the deed may still be reformed.LaSalle National Bank v 850 De Witt Condominium Assn, 211 Ill App 3d 712, 719, 570 NE2d 606, 156 Ill Dec 130, (1st D, 1991).


To reform a deed, there must be evidence that the parties made a mistake. This mistake must be one of fact and not of law. The mistake must be mutual. If only one party has made a mistake, the other party is not at risk of having the deed reformed unless they were aware of the mistake and failed to say anything. And the mistake must be such that it renders the deed incorrect as to the true intentions of the parties. In some instances, such as when one of the required elements of a deed is missing, a court may simply void the conveyance. But when this action would lead to an inequitable result, reformation may be the proper remedy.

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