2. Aaron transferred ownership of his farm to Bob and gives him a general warranty deed. A general warranty deed is a deed that contains full warranty of title. Aaron had a mortgage with First Bank and Trust but the warranty does not mention the mortgage from First Bank and Trust so therefore Bob is oblivious to this. Afterwards, Bob then sells the farm to Carol by limited warranty. A limited warranty deed is where the grantor covenants and warrants only against the lawful claims of people claiming by, through, or under the grantor. Carol then decides to sell the farm by general warranty to David. This warranty also does not mention anything about a mortgage to First Bank and Trust. In this case there is a breach of covenant and that would be Covenant against Encumbrances. At this stage David can sue Aaron, because he was the original owner of the property and the only person who knew about the mortgage but did not declare it to anvone else