## Facts

- Sellers agreed by written contract (Oct. 2, 1987) to sell a 0.74-acre lot in North Myrtle Beach, South Carolina, to purchaser Charles R. Strickland for $50,000, with closing on or before Jan. 1, 1988.
- During negotiations, the parties discussed that the lot was “low and wet,” that filling would require regulatory permits, and that the property had a known “wetlands situation.”
- Strickland knew a prior prospective purchaser withdrew due to wetlands concerns and was told the U.S. Army Corps of Engineers considered the lot wetlands.
- The contract required delivery of “good and marketable and insurable” title by warranty deed, but stated the conveyance would be subject to recorded encumbrances and “all governmental statutes, ordinances, rules and regulations.”
- The contract did not make the purchase contingent on Strickland obtaining permits or on the lot being usable for homesites.
- A biologist confirmed the entire lot was wetlands (Dec. 23, 1987), and Strickland notified the sellers he would not proceed (Dec. 27, 1987).
- The sellers sued for breach; the trial court ruled for Strickland, concluding wetlands-related development restrictions made title unmarketable and uninsurable.

## Issues

1. Whether wetlands-related regulatory restrictions rendered the sellers unable to convey “marketable and insurable” title.
2. Whether Strickland was justified in refusing to close based on the wetlands designation and anticipated permitting difficulties.
3. Whether the sellers’ failure to tender a deed barred their breach action where Strickland repudiated before closing.

## Decision

- The Court of Appeals reversed and remanded.
- It held the sellers could convey marketable and insurable title; wetlands restrictions concerned use and value rather than defects in ownership or title.
- It held Strickland was not justified in rescinding because the contract made the conveyance subject to governmental regulations and contained no permit/use contingency, allocating that risk to the purchaser.
- It held tender of a deed was not required after Strickland’s prior refusal to perform, because tender would have been futile.
- The case was remanded for determination of the appropriate contractual remedy.

## Legal Principles

- Marketable title concerns defects in ownership or title (e.g., encumbrances or adverse claims), not regulatory limits that may reduce value or restrict development.
- When a contract expressly provides the conveyance is subject to governmental statutes, ordinances, rules, and regulations, the purchaser generally bears the risk that such regulations will constrain intended use absent an express contingency.
- Title may remain “insurable” even if a title policy would except known conditions or regulatory restrictions consistent with the contract’s terms.
- A seller need not tender performance where the buyer has anticipatorily repudiated and tender would be a useless act.

## Conclusion

The appellate court held that wetlands-related development restrictions did not make title unmarketable or uninsurable under a contract expressly subject to governmental regulations, and that the purchaser’s pre-closing refusal constituted breach without requiring the sellers to tender a deed; the case was remanded to select the proper remedy.


McMaster v. Strickland, 409 S.E.2d 440 (S.C. Ct. App. 1991)