In New Castle, Delaware, a historical marker at the landing place of William Penn reads:

“Near here October 27, 1682, William Penn first stepped on American soil. He proceeded to the fort and performed livery of seisen.‘He took the key thereof.… We did deliver unto him turf with a twig-upon it, a porringer with river water and soil, in part ofall.’”

The common-law ceremony of “livery of seisen” referred to on the historical marker served the dual purpose of providing certainty to ownership in the context of a paperless society (in which the old sheepskin bestowed at graduation was written on a sheep’s skin) and introducing some quaint French words into the legal system. The terms “livery,” “feoffor,” and “feoffee” and the ceremony itself have become institutionalized in real estate practice in the terms delivery, offeror, and offeree as well as the requirements of the statute of frauds and the statutes related to eligibility for recording.

The Middle Ages ceremony consisted of the feoffor and the feoffee and their witnesses standing on or near the property. Conveyance was accomplished by a declaration by the feoffor and the transfer of an object such as a piece of turf or the ring of a door.

This method of conveying real estate continued to be legal in England until 1925, when it was abolished, presumably because the register of deeds offices were becoming cluttered with too many clumps of dirt.

Statutory Provisions for Delivery

In Wisconsin, Wis. Stat. section 706.02 replaces the common-law ceremony and recites the elements that are required for a valid real estate transfer. The statute provides that certain real estate transfers are only valid if there is a conveyance (a written instrument) that contains seven elements:

Formal requisites.

(1) Transactions under s. 706.001 (1) shall not be valid unless evidenced by a conveyance that satisfies all of the following:

(a) Identifies the parties; and

(b) Identifies the land; and

(c) Identifies the interest conveyed, and any material term, condition, reservation, exception or contingency upon which the interest is to arise, continue or be extinguished, limited or encumbered; and

(d) Is signed by or on behalf of each of the grantors; and

(e) Is signed by or on behalf of all parties, if a lease or contract to convey; and

(f) Is signed, or joined in by separate conveyance, by or on behalf of each spouse, if the conveyance alienates any interest of a married person in a homestead under s. 706.01 (7) except conveyances between spouses, but on a purchase money mortgage pledging that property as security only the purchaser need sign the mortgage; and

(g) Is delivered. Except under s. 706.09, a conveyance delivered upon a parol limitation or condition shall be subject thereto only if the issue arises in an action or proceeding commenced within 5 years following the date of such conditional delivery; however, when death or survival of a grantor is made such a limiting or conditioning circumstance, the conveyance shall be subject thereto only if the issue arises in an action or proceeding commenced within such 5-year period and commenced prior to such death.

Wisconsin Statutes section 706.05 provides additional elements in order to record the document, including authentication or acknowledgement of signatures (the witness) and a full legal description.

The elements of the statute, while relatively simple, nonetheless invite compliance issues related to delivery, which is not separately defined. Most of the relevant case law involves estate planning situations, in which a deed intended to take effect at death was properly executed but left in the decedent’s estate planning file. Often, the grantee in such situations was unaware of the transfer, and other beneficiaries who would be prejudiced if the deed was effective were able to overcome the transfer, arguing lack of delivery.

A typical fact situation is recited in the Pennsylvania case of Fiore v. Fiore, 405 Pa. 303 (1961). Fiore involved a deed prepared at the direction of the grantor, properly executed, and left in the care of the drafting attorney. Seventeen years later, the deed was “discovered” by the attorney, recorded by the grantor’s widow (15 years after his death), and contested by a son. In holding in favor of the son, the court noted two indispensible requisites – donative intent and delivery – and concluded that the record did not support a conclusion that the grantor had ever intended delivery.

The standard form offer to purchase in Wisconsin (required for use by real estate licensees) provides that a real estate contract must include two events to be enforceable. The first is “acceptance” and the second is “binding acceptance.” Acceptance is defined as physically signing the document, while binding acceptance is the act of delivering it to the other party. Curiously, many dates in the contract are predicated on the date of acceptance, which could be well before the document is delivered.

The offer to purchase form provides for five methods of delivery:

• personal delivery;
• mail;
• commercial delivery;
• faxing to a fax number; or
• email.

The default choice on the offer to purchase is personal delivery. Use of any of the remaining options requires first that the box next to the method be checked, and second that the appropriate data for the method be included. Failure to check the box next to a method results in that method not being available as the result of the language at line 31 of the offer to purchase form even if the data is included.

In addition to the five delivery methods the offer to purchase form provides, technology has developed additional delivery methods that are not contemplated by the approved form. Texting pictures of executed pages, faxing to an email address, or delivery by drone could be contractual delivery methods, but would require a separate provision on the offer to purchase.

Wisconsin decisions consistently require compliance with the contractual delivery method. In Stubbe v. Hamland, No. 2012AP469, 2012 WL 4872116 (Wis. Ct. App. Oct. 16, 2012) (unpublished), the court addressed the delivery of a financing commitment. The standard Wisconsin offer requires that delivery of the commitment letter be accompanied by the buyer’s written direction to deliver it. Because that direction was not included, the delivery of the commitment letter was ineffective.

Electronic Delivery

The electronic option for delivery at lines 51-52 of the offer to purchase form provides “each consumer providing an e-mail address below has first consented electronically to the use of electronic documents, e-mail delivery and electronic signatures in the transaction, as required by federal law.”

Wisconsin’s rules related to electronic transactions are contained in Wis. Stat. chapter 137. Those rules are applicable except when superseded by federal law. A commercial real estate transaction is covered under Wisconsin law, while a consumer real estate transaction must comply with federal law.

The federal e-consent law is the “Electronic Signatures in Global and National Commerce Act,” which applies when information relating to a transaction is required to be made in writing. For electronic transactions to be valid, the parties are required to receive an electronic form, sign it electronically, and return it to the originating computer. The purpose of the law is to confirm the consent and ability of the parties to send and receive electronic documents. Obsolete hardware and software may satisfy an owner’s needs but result in an inability to open files delivered electronically by a more modern computer.

The Wisconsin Realtors Association (WRA) has developed a form that complies with the e-consent requirements. WRA forms are available to Wisconsin lawyers who purchase a legal section membership from the association.

Delivery Problems

In reviewing offers submitted by clients suffering buyer’s remorse, a first line of evaluation is to determine whether the contract has been properly accepted. Failure to comply with e-consent or otherwise properly deliver often presents itself as the first argument for asserting the absence of a valid contract. (A second item, often overlooked, is the applicability of the requirement for a lead-based paint disclosure – and delivery of a pamphlet – also required under federal law.)

In addition to the possibility a party will argue the contract is unenforceable, lawyers using electronic delivery should also be aware that lenders exercising the “best practices” now required by federal law (the Dodd-Frank Wall Street Reform and Consumer Protection Act) are requiring receipts confirming electronic consent was accomplished. Inability to produce the receipt will be not only embarrassing but also contractually problematic, especially if it is a condition at closing and the lawyer is unable to produce it.

Conclusion

Paperless transactions were the norm in real estate for many centuries. Then, for a few hundred years, paper transactions were the acceptable method of transferring real estate in the United States. In the last decade, the industry has been returning to a paperless format. Whether to participate in that model is a decision not to be made lightly. If the choice is to engage in the business of real estate law electronically, compliance with the rules of livery of seisen is still required, and caution must be exercised to apply those rules to the new law and technology affecting real estate transactions today.