The Sale of Parcel of Land That Is Not a Legal Parcel under the Subdivision Map Act is Unenforceable Unless the Contract to Sell the Property is “Expressly Conditioned” Upon the Approval and Filing of a Final Map
In Sixells, LLC v. Cannery Business Park et. al., the California Court of Appeal, (3rd District), upheld the trial court’s sustaining of plaintiff’s demurrer without leave to amend on the ground that the purchase and sale agreement of real property that plaintiff was attempting to enforce was void at its inception because it violated the Subdivision Map Act’s prohibition of the sale of a parcel of real property until a parcel map has been filed.
In Sixells, defendant Cannery owned an office park on C Street in Sacramento. Within the business park was four acres of undeveloped land. Plaintiff entered into a contract with Cannery to buy the four acres. The contract allowed Sixells to complete the purchase if, at its election, the four acres were made into a legal parcel or if plaintiff waived the creation of a legal parcel.
Cannery terminated the contract before the four acres were made into a legal parcel or before plaintiff waived the condition. Cannery than sold the entire business park to a third party. Plaintiff sued Cannery and the third parties for declaratory relief, specific performance and intentional interference with contract.
The defendants demurred to the complaint on the ground that the contract was void and unenforceable. The trial court sustained the demurrer without leave to amend and the Court of Appeal concurred.
The Court ruled that the contract was void because it violated the Subdivision Map Act which prohibits the sale of real property until a parcel map has been filed or the sale is expressly conditioned upon the approval and filing of a final subdivision map or parcel map. In this action, the Court of Appeal held that since Sixells had the right to waive the recording of the final map, the sale was not conditioned upon the approval and filing of a final subdivision map or parcel and as a result, the contract was void as a matter of law.
Prospective sellers and buyers of undeveloped real estate should consult with an attorney regarding the requirements set forth in the Subdivision Map Act before entering into a purchase and sale agreement. If the Subdivision Map Act is not strictly adhered to, the purchase and sale agreement may be void as a matter of law.
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