The tale behind a real estate transaction usually follows the same pattern: a potential buyer approaches a seller after viewing the advertised property, negotiations commence and the parties arrive at a meeting of the minds and enter into an agreement of purchase and sale. But what happens when the seller is not a human or is dead? These situations regularly arise when property is sold by a corporation or a deceased’s estate. In both of these instances, there are certain requirements that must be satisfied in order for the seller to properly convey title.
The law views corporations as an independent legal entity similar to a person. As a result, a corporation may hold property independent of its officers, directors and shareholders. Obviously though, when a corporation sells property, it cannot negotiate, act, nor sign for itself. Consequently, it requires the assistance of its directors and officers.
The law is clear that a corporation may only enter into an agreement of purchase and sale after its directors approve the transaction by resolution. In addition to the resolution, a corporation may only be bound by the agreement of purchase and sale if it signs in a particular way. The corporation’s full legal name must be set out in the agreement, followed by the names and offices of those officers signing on the corporation’s behalf. Only if both of these requirements are satisfied will a corporation be deemed to have sold its property.
Similar to a conveyance by a corporation, a deceased person’s property may only be conveyed if the estate trustees consent. The required approval, however, is more stringent than that needed by a corporation as all estate trustees must agree to sell a deceased person’s property. Furthermore, every estate trustee must sign the agreement of purchase and sale evidencing their consent. Only if both of these requirements are satisfied will the agreement of purchase and sale be binding on the estate.
As a purchaser in both of these instances, it should be clear that the first step in purchasing a property from either a corporation or a deceased person is to determine who is a director and who is an estate trustee, respectively. With regards to directors, the names are easily available pursuant to a corporate search. With regards to estate trustees, they are either named through a will, or appointed by the court. Either way, an estate trustee should have a certificate of appointment of estate trustee before entering into an agreement of purchase and sale. Therefore, by negotiating with the right individuals, and satisfying the requirements set out above, a purchaser may transact with a non-human entity or the dead.