Chapter 02: Property Ownership & Interests Flashcards
The concept by which land would increase automatically along a river or stream is known as:
A. accretion
b. littoral rights
C. avulsion
D. reliction
A. accretion
(Accretion is the gradual buildup of land along a river a stream. It increases automatically because the land owner does not have to do anything to gain the increase. It is the opposite of erosion)
Which of the following is generally considered real property?
A. emblements
B. trade fixtures
C. a shrub planted in a decorative pot
D. a perennial shrub planted in the backyard
D. a perennial shrub planted in the backyard
(Real property includes the land and all of the appurtenances that go with it. Emblements, the right of the previous owner to harvest crops through the current growing season is not considered part of the land. Both trade fixtures and the shrub in a separate container or pot are considered personal property and not part of the land)
The phrase “bundle of legal rights”:
A. is part of the definition of real property
B. is another name for a legal description
C. refers to the legal documents used in real estate transactions
D. refers to the tenant’s rights in a lease
A. is part of the definition of real property
(The transfer of real property includes the transfer of a bundle of rights, including all of the rights, interests and appurtenances that are part of the property. These are referenced by the acronym DEEPC, disposition enjoyment, exclusion, possession and control.)
A trade fixture is considered:
A. a fixture
B. an easement
C. personality
D. a license
C. personality
(Typically fixtures are part of the real property and get transferred with the property. Trade fixtures are those items used in a trade and business and they remain personalty. This means the tenant may remove these items so long as they do so before the expiration of the lease)
Real property can become personal property by:
A. severance
B. purchase
C. hypothecation
D. attachment
A. severance
(The act of permanently attaching personal property and transforming it into a fixture is called annexation. The act of turning real property into personal property is called severance. A good example would be the trees growing on the property which are considered real property. Severance occurs when they are cut down and severed from the property and they become firewood which is personal property)
A seller is under contract to sell a property using the standard offer to purchase and contract. The elegantly decorated master bedroom has vertical window blinds, hand-painted light switches and electrical outlet covers and draperies fashioned from fabric coordinated with the wallpaper. Which of the following items may the seller legally remove before the close of the transaction?
A. none of the items
B. the draperies and blinds
C. the hand-painted light switches and electrical outlet covers
D. the draperies
D. the draperies
(Parties to a transaction are able to specifically contract for certain items to either transfer or remain with the property. The standard NCBA/NCAR purchase contract considers and lists all of the other items as fixtures which are to remain with the property. The draperies are not considered a fixture and the seller may remove them)
A business owner rents an empty building to use an ice cream parlor. The tenant subsequently installs large freezer units and several service counters. These additions:
A. are considered permanent improvements to the property
B. become the landlord’s property once attached to the building
C. can be legally removed by the tenant at the termination of the lease
D. can only be removed by the tenant with the landlord’s permission
C. can be legally removed by the tenant at the termination of the lease
(These items are considered trade fixtures and as such remain personalty)
The owner of a house wants to fence the yard for a dog. When the fence is erected, the fencing materials are converted to real estate by:
A. severance
B. annexation
C. immobility
D. indestructibility
B. annexation
(This is the process of taking items of personal property and converting them to real estate. The fence materials were personal property. Once the fence was incorporated into the real estate the fence became part of the real property through the process of annexation)
Which of the following has an indefinite ownership period?
A. fee simple estate
B. life estate
C. estate for years
D. estate at will
A. fee simple estate
(A fee simple estate, also known as a “fee” is the highest and best form of ownership. The owner possesses all of the rights or interests and the ownership lasts forever, therefore it is considered indefinite.)
Oil, gas, and other subsurface rights are generally considered to be:
A. separate and apart from the rights or interest in the real estate
B. an item which can never be separated from the real estate and must transfer with the property
C. items of personality which the owner can either include or exclude from the transfer
D. be part of the real estate and its bundle of rights and automatically transfer to a subsequent owner unless specifically reserved or excepted in the deed
D. be part of the real estate and its bundle of rights and automatically transfer to a subsequent owner unless specifically reserved or excepted in the deed
A woman wishes to donate a vacant lot that she owns in fee simple absolute to a hospital that is located next to her lot. An attorney prepares a deed that conveys the ownership of the lot to the hospital “so long as it is used for medical purposes.” After the completion of the gift, the hospital will hold a:
A. pur autre vie estate
B. fee simple absolute estate
C. defeasible fee
D. fee simple to a condition subsequent estate
C. defeasible fee
(The property was transferred subject to a condition that the property only be used for medical purposes. Such a condition creates a defeasible fee which if violated will return ownership to the original grantor through a reversion.)
The rights of the owner of a property located along the banks of a small stream are called:
A. littoral rights
B. subjacent rights
C. riparian rights
D. hereditaments
C. riparian rights
(Riparian water rights exist along rivers and streams. The rights along large bodies of water that are subject to tides are littoral rights.)
A deed conveyed ownership to a grantee “so long as the existing building on the property is not destroyed.” Following the transfer, the original grantor has what type of interest?
A. life estate
B. ongoing ownership in the property that lasts as long as the condition
C. fee simple estate
D. reversionary estate
D. reversionary estate
(The original grantor no longer has an ownership interest. All ownership is with the grantee who holds a defeasible fee subject to the condition. The original grantor does have a right to regain the property if the condition is violated. That future right or interest of the grantor is called a reversionary interest, an estate in reversion or a reversionary estate.)
A woman conveys a life estate to her son-in-law and stipulated that upon his death the estate will pass to her grandson. The grandson has an:
A. estate in reversion
B. estate in remainder
C. estate pur autre vie
D. estate for the life of another
B. estate in remainder
(At the termination of a life estate the interest in the property can be transferred back to the grantor in which case it is a reversionary life estate. If the interest is transferred to anyone other than the grantor it is called a remainder interest. Here the property is not returning to the original grantor (woman), but instead is passing to her grandson who has a remainder interest.)
A person who acquired ownership that can be inherited, with the provision “that the land must always be used for recreational purposes,” has:
A. a fee simple absolute estate
B. a defeasible fee
C. a fee simple to a condition subsequent estate
D. an estate that cannot be sold
B. a defeasible fee
(A defeasible fee is a transfer of real property that is subject to a condition.)
A brother and sister bought a commercial building and took title as joint tenants with right of survivorship. The brother died. The sister now owns the building:
A. as a joint tenant with right of survivorship with her brother’s heirs
B. in severalty
C. as a tenant in common with her brother’s heirs
D. as a life tenant with her brother’s heirs having remainder interests
B. in severalty
(A right of survivorship means that at the death of one of the property owners, the remaining joint tenants will inherit the deceased persons interest in the real estate. Since the sister would not be the only surviving owner she will hold title to the property in severalty)
A person currently has the legal right to occupy and use a certain residential structure. The interest in the property could be all of the following, EXCEPT:
A. fee simple
B. remainder
C. leasehold
D. life estate
B. remainder
(All of the other choices include a right to occupy the property. A remainder interest is a future interest which a person will acquire. It does not include a current right to occupy the property)
One of two owners holds an undivided 60% interest and the other holds an undivided 40% interest. The two owners probably hold their interest as:
A. cooperative owners
B. tenants by the entireties
C. community property owners
D. tenants in common
D. tenants in common
(Tenants in common may hold different percentages of ownership in the property. Typically the share or interest of joint tenants must be equal, although in North Carolina that element of joint tenancy is not required.)
Co-owners of a fee simple interest in a small office building are neither related to nor a creditor to each other. One owner dies intestate. The surviving owner would become the sole owner of the property under which of the following rights?
A. adverse possession
B. reversionary interest
C. survivorship
D. foreclosure
C. survivorship
(A surviving property owner acquires the interest of a deceased property owner when the property is co-owned with a right of survivorship.)
Three joint tenants with rights of survivorship own a parcel of land. One owner sells his interest to a long-time friend. After the conveyance, the remaining original owners:
A. become tenant in common with each other
B. become tenants in common with each other and the newest owner
C. become joint tenants with the newest owner
D. remain joint tenants with the newest owner
D. remain joint tenants with the newest owner
(The original owners would still remain joint tenants because they meet the four unities of joint tenancy; time, title, interest and possession. People can always sell or transfer their interest prior to their death. The long-time friend who purchased the interest would become a tenant in common with the other owners.)
The owner of a condominium unit learns that a neighbor has failed to pay his condominium association dues. If the neighbor does NOT pay the dues:
A. a lien can be filed against the condominium complex
B. a lien can be filed against the neighbor’s unit
C. a lien can only be filed against the common areas of the condominium
D. the taxing authority can order the condominium be dissolved
B. a lien can be filed against the neighbor’s unit
(Unpaid condominium or HOA dues can become a lien against the property)
In order to create a joint tenancy relationship in the ownership of real estate, there must be unities of:
A. grantees, ownership, claim of right and possession
B. title, interest encumbrance and survivorship
C. time, title, interest, and possession
D. ownership, possession, heirs and title
C. time, title, interest, and possession
(Joint tenancy requires four unities. All owners must come into ownership at the same time, through the same title or deed. They all have an equal interest in the property and they all have an equal right to possess the property)
The severalty owner of a parcel of land sells it. The buyer insists that the owner’s wife also sign the deed. The purpose of obtaining the wife’s signature is to:
A. terminate any rights the wife may have in the property
B. defeat any curtsey rights
C. provide evidence that the owner is married
D. subordinate the wife’s signature to the buyer
A. terminate any rights the wife may have in the property
(It is possible for married people to own property and hold title in their own name without their spouse listed as an owner. However, because most states recognize some marital interest of a spouse in the property (even though their name does not appear on title) the spouse’s signature will usually be required at the time of sale)
Which item(s) listed below would be considered part of the “total circumstances test” to determine whether or not an item is a fixture? I. The value II. The size
A. I only
B. II only
C. Both I and II
D. Neither I nor II
D. Neither I nor II
(The total circumstances test, or IRMA uses the following factors to determine if an item is a fixture; intent, relationship, method and attachment. Cost, value and size are never factors in determining if something is a fixture)
