Granting Title without Warranties
A deed doesn’t have to make any deed covenants. Some authorities use different labels to distinguish between two types of deeds that make no covenants of title:
Bargain and sale deed: This label may describe a deed that says it conveys a particular estate to the grantee but that doesn’t warrant title to that estate.
Quitclaim deed: A quitclaim deed doesn’t purport to convey any particular estate at all. Instead of saying the grantor conveys fee simple absolute or some other estate, the quitclaim deed just says that it conveys whatever right, title, or interest the grantor may have in the described property.
Quitclaim deeds are commonly used for gifts, when the grantee isn’t paying anything for the property and the grantor has no incentive to warrant title. They’re also used to clear up title problems.
If title is uncertain, the person seeking to get clear title may get quitclaim deeds from possible conflicting claimants. In such cases, the grantor may not own anything at all, so he uses a quitclaim deed to indicate that he gives the grantee whatever rights he has in the property, if any.
Whether these labels are used or not, there may be an important difference between bargain and sale deeds and quitclaim deeds. If the deed says that the grantor conveys a particular estate, courts are more likely to hold that if the grantor later acquires some or all of that estate, it automatically passes to the grantee.
Why? Because the deed estops the grantor from denying that the grantee owns it. If the deed doesn’t convey a particular estate but just says that the grantor gives whatever he owns in the property, if anything, then courts are less likely to apply the estoppel by deed doctrine.