CH 2: Property Estates & Ownership Flashcards
estate
an interest or a right in property
future interest
right to possession in the future
leasehold estate
specific duration
Primary characteristics of a freehold estate:
- Possession either immediately or in future
- indefinite duration of possession
- property ownership
fee simple estate
owner possess full bundle of rights, limited only by government power.
possibility of reverter
contingent future interest in the land
fee simple subject to a condition subsequent
“on the condition that”
- former owner has power of termination - can take steps to re-enter land to see if the condition is being complied with, if not, they can legally take possession away from landowner through due process
leased fee interest
lessor (landowner) interest in leased property
- lessor owns the property and other rights, but due to the lease, cannot occupy or possess the property
life estates
freehold estates that last only as long as a specified person lives
- holder is called the life tenant
life estate pur autre vie
freehold estate that lasts for another’s life
reversionary interest (life estate)
grantor has future interest in a life estate
remainder interest (life estate)
future interest belongs to someone other than the grantor
remainderman (life estate)
person with the future interest (not the grantor)
leasehold estates (tenancy)
interests that give the holder temporary right to possession without title
- involves 2 parties: holder of leasehold - lessee/tenant
- owner/lessor/landlord
Estate for years
- any leasehold estate for a fixed time (not necessarily years)
- also term tenancies
- terminates at end of lease
surrender
ending a lease by mutual consent
periodic tenancy
estate from period to period - not a specified time
Ex: regular lease is up on your apt and you just go to “monthly” renting
tenancy at will
- leasehold w/ no specific term
- either party can term at any time
- cannot be assigned to someone else and automatically ends upon death of either party
tenancy at sufferance
possession of property by a holdover tenant
- not different from a tresspasser
title
acutal lawful ownership of real property and refers to holding the bundle of rights conveyed
ownership in severalty
-ownership by one person or entity
corporation
legal entity where individuals hold shares of stock
real estate investment trust (REIT)
investment corp or trust w/at least 100 investors and organized as a trust
- pools of many investors’ money can be used to purchase real estate
Distinction of Co-Ownership (PITT)
Possession
Interest
Time
Title
Unity of Possession
each owner is entitled to possession of the entire property
- burden of maintaining land (taxes etc) fall on each co-owner in proportion to their share of ownership
Unity of Interest
means each co-owner has an equal interest in property
- 50/50
Unity of time
acquired title at the same time
Unity of title
acquired title through same instrument
tenancy in common
- most basic form of co-ownership
- does not include right of survivorship
- each co-owner can do what they want with their interests
- UNITY OF POSSESSION ALWAYS PRESENT
- one tenant can get a judicial partition action by filing in court
Joint Tenancy
can be formed only with:
- unity of possession
- unity of interest (same estate and equal share)
- unity of time
- unity of title
Includes survivorship
can be terminated by agreement, partition, or severance
Tenancy by the entireties
- recognized by 1/2 states
- only an option for married couples
- each spouse owns undivided one-half w/ right of survivorship
- neither spouse can convey w/o consent
Separate Property (Marital Property Rights)
property that was owned by either hus/wife before they were married
- can be transferred w/o consent of spouse not on title
Community Property (Marital Property Rights)
- was acquired by spouse during marriage
- upon death, surviving spouse gets 50% regardless of will
- consent required to transfer
curtesy and dower (marital property rights)
If property not in co-ownership before death:
- law entitles surviving spouse a 1/3 or more right of use of real property owned by other spouse when they die
- surviving spouse can use entire property for life
- sometimes dower = wife’s rights and courtesy = husbands’s rights
Trusts
used for holding and controlling property on behalf of someone else
- trustor conveys title to trustee for benefit of a 3rd party (beneficiary)
types of trusts
- living trusts (established while owner is still alive
- testamentary trust (via a will after owner’s death)
- land trust (only real estate, trustor is also beneficiary, tax advantages and veiling identity of beneficiary)
LLC
- special type of corp
- income passed directly to shareholders and is not taxed at corp level
- fewer restrictions
General Partnership
- all partners share financial liability for each other
- usually held as tenants in common
Limited partnership
- has both general and limited partnerships
- limited partners have no say in partnership matters
- partner’s liability is limited to original investment
syndicates
informal usually formed to accomplish one thing
not recognized as legal
can refer to almost any form of business
condiminiums
- can be applied to residential units or office spaces
- separate interest in individual units, undivided interest in common areas
- residents must follow rules of founder
- separate mortgages and taxes for each unit
Cooperatives
- owned by a corp w/ residents as shareholders
- each receive a proprietary lease on an individual unit + common areas
- person who wants to live there buys shares in the corp
fee timeshare
specified condominium in a resort setting where numerous co-owners have an undivided interest in a particular unit
- eacy co-owner has a specified time each year for which they use it.
non-fee timeshares
- no real property co-ownership
- only right to use and enjoy property
- commonly seen where major resort hotel co sell the right to occupy any of their properties for a specific period of time
