Agreement or Contract for Deed for Sale and Purchase of Real Estate a/k/a Land or Executory Contract
Iowa Statutes
TITLE XIV PROPERTY
SUBTITLE 2 REAL PROPERTY - GIFTS
CHAPTER 558 CONVEYANCES
558.5 Contract for deed - presumption of abandonment.
1. When the record shows that a contract or bond for a deed was executed more than ten years earlier, the contract or bond shall be deemed abandoned by the vendee and void and the land shall be freed from any lien or defect on account of the contract or bond in any of the following situations:
a. The record does not indicate the contract or bond has been performed and more than ten years have elapsed since the contract or bond by its terms was to be performed.
b. A performance date for the contract or bond is not stated in the contract or bond or any extensions thereof and more than twenty years have elapsed from the date the contract or bond was executed.
2. This section shall apply to a contract or bond described in this section if the contract or bond is not filed of record but is referred to in another instrument which is filed of record. The contract or bond shall be deemed abandoned by the vendee ten years from the date that the contract or bond is to be performed according to the recorded instrument. However, if the recorded instrument does not refer to a performance date for the contract or bond, the contract or bond shall be deemed abandoned twenty years after the date that the instrument containing the reference is recorded.
3. This section shall not apply to a vendee or a vendee's successor in interest if the vendee or the vendee's successor in interest is in possession of the property or has been continuously paying the total amount due, as defined in section 445.1, of the taxes levied against the property for the preceding five years.
[S13, 2963-j; C24, 27, 31, 35, 39, 10070; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, 558.5]
91 Acts, ch 183, 8 2013 Acts, ch 83, 1
TITLE XV JUDICIAL BRANCH AND JUDICIAL PROCEDURES
SUBTITLE 5 SPECIAL ACTIONS
CHAPTER 656 FORFEITURE OF REAL ESTATE CONTRACTS
656.2 Notice.
1. The forfeiture shall be initiated by the vendor by serving on the vendee a written notice which shall:
a. Reasonably identify the contract by a document reference number and accurately describe the real estate covered.
b. Specify the terms of the contract with which the vendee has not complied.
c. State that unless, within thirty days after the completed service of the notice, the vendee performs the terms in default and pays the reasonable costs of serving the notice, the contract will be forfeited.
d. Specify the amount of attorney fees claimed by the vendor pursuant to section 656.7 and state that payment of the attorney fees is not required to comply with the notice and prevent forfeiture.
2. a. The vendor shall also serve a copy of the notice required in subsection 1 on the person in possession of the real estate, if different than the vendee; on all the vendee's mortgagees of record; and on a person who asserts a claim against the vendee's interest, except a government or governmental subdivision or agency holding a lien for real estate taxes or assessments, if the person has done both of the following:
(1) Requested, on a form which substantially complies with the following form, that notice of forfeiture be served on the person at an address specified in the request.
REQUEST FOR NOTICE PURSUANT TO
IOWA CODE SECTION 656.2, SUBSECTION 2
The undersigned requests service of notice under Iowa Code sections 656.2 and 656.3 to forfeit the contract recorded on the ........ day of ................ (month), ........ (year), in book or roll ................, image or page ............, office of the ................ county recorder, .................... county, Iowa, wherein ........................................ is/are seller(s) and ........................................ is/are buyer(s), for sale of real estate legally described as: [insert complete legal description]
....................................................
NAME
....................................................
....................................................
....................................................
ADDRESS
CAUTION: Your name and address must be correct. If not correct, you will not receive notice requested because notice need only be served on you at the above address. If your address changes, a new request for notice must be filed.
(2) Filed the request form for record in the office of the county recorder after acquisition of the vendee's interest but prior to the date of recording of the proof and record of service of notice of forfeiture required by section 656.5 and paid a fee of five dollars.
b. The request for notice is valid for a period of five years from the date of filing with the county recorder. The request for notice may be renewed for additional periods of five years by the procedure specified in this subsection. The request for notice may be amended at any time by the procedure specified in this subsection. The request for notice shall be indexed.
c. The vendee's mortgagees of record include all assignees of record for collateral purposes.
3. As used in this section, the terms vendor and vendee include a successor in interest but the term vendee excludes a vendee who assigned or conveyed of record all of the vendee's interest in the real estate.
[C97, 4299; S13, 4299; C24, 27, 31, 35, 39, 12390; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, 656.2]
84 Acts, ch 1203, 2 ; 86 Acts, ch 1237, 41 ; 87 Acts, ch 166, 1 ; 91 Acts, ch 161, 1 ; 2000 Acts, ch 1058, 56 ; 2001 Acts, ch 44, 32 ; 2003 Acts, ch 108, 112 ; 2003 Acts, 1st Ex, ch 2, 44, 209 ; 2013 Acts, ch 90, 219
Iowa Case Law
When the vendee contracts to buy and the vendor to sell, though legal title has not yet passed, in equity the vendee becomes the owner of the land, and the vendor of the purchase money. In equity the vendee has a real interest and the vendor a personal interest. Equity treats the executory contract as a conversion, whereby an equitable interest in the land is secured to the purchaser for whom the vendor holds the legal title in trust. This is the doctrine of equitable conversion. Krotz v. Sattler 586 N.W.2d 336 (Iowa Sup.Ct. 1998).
Upon a vendee's breach of an executory land contract, a vendor has three alternative remedies: rescission, compliance with the contract followed by an action for specific performance, or retention of the land coupled with a damage action for loss of the bargain. Gordon v. Pfab 246 N.W.2d 283 (Iowa 1976).
