My husband and I made an offer on a house just before he returned to Iraq after a little rest and relaxation. After some negotiation, we arrived at a price and signed a contract. Only after this was I told by a neighbor that the driveway was inside his property line. He said he will not sign an easement. So we would have no driveway! As a result, I want to back out of the sale but the real estate company is threatening to sue. Can they?
Sure, the real estate company could sue but it's not likely it will, if history is any guide. But that may be a moot point if you really like the house and still want to live there, despite that neighbor.
That's because the driveway may actually be "yours" after closing, acquired by the previous owner by default through something called "adverse possession." Adverse possession allows someone to obtain the use and (or) title to a property merely by using it as his own over a set period that can vary from two to 20 years, minus a protest from the actual owner.
If the neighbor knew about this disparity and didn't tell the seller in that set period, that could be considered as his consent to the easement. If he did inform the seller but the seller didn't disclose this very important fact to you in the contract, he may have breached his legal disclosure duties -- perhaps deceiving you just to secure the sale. That could invalidate the contract and the real estate company would have to back down then. Of course, it's likely you would have to see a real estate attorney to sort through this very gray area of the law, should worst come to worst.
Most jurisdictions, by the way, will consider that the real owner has acquiesced to such an adverse possession unless trespass action had been brought within the earlier mentioned time frame. Also, some cities permit "accidental" adverse possessions that stem from surveying errors.
However, one of the neighbor's most effective legal arguments against adverse possession would be if he had shared the driveway with the previous owner or others in a "nonexclusive use" arrangement. Another might be if his property is registered land that is guaranteed by the state's insurance fund to be correct, which would technically insure the owner from losses caused by land-examiner or recorder error.
Either way, you still should have been informed of this property dispute before you signed the contract.
You can see that this situation could get messy and costly, not to mention the acrimony it would create between you and a neighbor before you even moved in! Moreover, I'd hate to see your husband have to stress over this while he is serving his country in a very dangerous environment.
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