Chapter 2-- Ownership, Interest, and encumbrances Flashcards
What does PETE stand for in regards to the limitations on ownership by governmental bodies?
Police Power: ability to enact legislation to preserve order, protect public health and safety, promote general welfare.
Eminent Domain
Taxation
Escheat
What is eminent domain
Is the right of government to acquire privately owned real estate for public use.
Condemnation
is the PROCESS by which the government exercises the right of Eminent Domain by judicial or administrative proceedings.
Ideally, the government would try to negotiate with the owner for fair compensation as many times they want the land for special purposes such as a school or church. If no agreement is met, then the government will initiate condemnation proceedings to acquire the property.
What is quick take
Local units of government bodies are given power of eminent domain by Illinois Constitution and by Illinois Code of Civil Procedure.
In certain situations, Illinois law permits a summary proceeding in which a plaintiff/condemner may obtain immediate fee simple title to real property, including the rights of possession and use.
Taxation
A part of PETE. Is a charge on real estate to raise funds to meet the public needs of government. Nonpayment of taxes give the government the power to claim an interest in the property.
Escheat aka revert
Is a process by which the state may acquires privately owned real or personal property when a person dies and they have no heirs or living trust.
Illinois: Ownership tranfers to County the property is located.
National law transfer ownership to the state.
What is an estate in land
To be an estate in land, an interest must allow possession. Meaning the holding and enjoyment of the property either now or in the future, and must be measured according to time.
Illinois Law Refining Eminent Domain
The Equity in Eminent Domain Act is a law that makes the government prove that an area is blighted before forcing property owners to sell their property for private development projects.
This act also:
- helps property owners receive fair market value
- requires relocation costs for displaced residents and businesses.
- pays attorney fees when property owners successfully sue to keep their property
Free hold estates
These type of estates last for an indeterminable length of time. For example a lifetime or forever. They include fee simple (aka indefeasible fee), defeasible fee, and life estates.
Fee simple and defeasible fee continue for an indefinite period and may be passed along to owner’s heirs.
Life estates are based on the lifetime of a person and ends when that person dies.
Leasehold estates
Last for a fixed period of time. Estates at will and estates at sufferance are also leasehold estates.
What is a Fee Simple Estate?
AKA fee simple absolute
Is a type of freehold estate.
The greatest possible estate in land, wherein the owner has the right to use it, exclusively possess it, commit waste upon it, dispose of it by deed or will, and take its fruits. A fee simple represents absolute ownership of land, and therefore the owner may do whatever he or she chooses with the land. If an owner of a fee simple dies intestate, the land will descend to the heirs.
Life estate
A life estate is the ownership of land for the duration of a person’s life. In legal terms it is an estate in real property that ends at death when ownership of the property may revert to the original owner, or it may pass to another person.
It Is a type of freehold estate. Life estates are NOT inheritable.
A life tenant is entitled to rights of ownership and can benefit from both possession and ordinary use and profits arising from ownership.
The life tenant’s ownership may be sold, mortgaged, or leased, but it is always subject to the limitation of the life estate.
Pur Autre Vie
A term meaning for the life of another. A life estate pur autre vie is a life estate that is measured by the life of a person other than the grantee. Not considered an estate of inheritance.
Legal Life estate
A life estate created by law; dowery, curtesy, and homestead.
Illinois has abolished the common law concepts of dower and curtesy in favor of the Uniform Probate Code. This gives the surviving spouse the right to take what is called an elective share on the death of the other spouse.
Homestead Right
By state law it protects the owners of the property from forced sale of a property and the improvements on land.
If the debt is secured by the property then the property cannot be exempt.
Homestead reserves a certain amount of money for the family in the event of a court sale. Debts that are secured by the home (mortgage, unpaid taxes, mechanics lien are paid from proceeds first. The family is then paid the homestead exemption amount. Whatever amount remains is paid to unsecured creditors such as credit cards.
Illinois law: every homeowner is entitled to a value of 15k for single person and 30k for a married couple.
Encumbrance
- A claim or lien on a property
- Does not have a possessory interest in real property
- can decrease value or obstruct the use of the property
- Is a right or interest held by someone other than the property owner that affects the title to the real estate but does not necessarily prevent a transfer of title.
Lien
It is a type of encumberance. A right given by law to certain creditors to have their debt paid out of the property of a defaulting debtor, usually means court sale.
Deed restrictions
Clauses in a deed limiting the future uses of the property. Deed restrictions may impose a vast variety of limitations and conditions such as dictating the types of structures that can be erected and preventing buildings from being used for specific purposes or from being used at all.
Covenants, Conditions, and Restrictions (CC&Rs)
These are private agreements that affect the land use typically imposed by a developer or subdivider to maintain specific standards in a subdivision.
Can be enforced by the original owner, developer, or by the homeowner’s association in the courts.
Easements
The right to use the land of another for a specific purpose, such as right-of-way. Includes airspace or right of way to the land.
Easement in gross aka utility easement
A person or company has interest right to use someone’s else’s land without being appurtenant to that land. Example: Comed guy
- Involves 1 tract of land
- Benefits a person or legal entity
- personal gross easements terminate on the sale of the property or the death of the easement owner
- Commerical easements are usually assignable when the property is sold or on the death of the easement owner.
Ex. Billboard is a personal easement, Water Line is a commerical easement
Easement by Necessity
Is created when a buyer purchases a property that has been landlocked by the seller.
Buyer must be given access rights to enter (ingress) and exit (egress) the property.
Easement by Prescription
Created when a claimant uses a property for a statutory period of time. An easement acquired by continous, open, uninterrupted, exclusive, and adverse use of the property for a period of time prescribed by state law.
Ex. You have 2 land owners. Land owner 1 has been using land owner’s 2 backyard pond to fish. And he has been doing this for years. He never asked permission. He never tried to sneak and fish in the pond. Land owner 1 decides one day that he does not want land owner 2 to use his pond more. By law, land owner 2 can take him to court to obtain an easement by prescription to continue using that pond.
So easement by prescription only gives someone the right to use another’s land. It does not give the ownership.
Terminating an easement
- when need is no longer needed
- when the owner of either the dominant or servant tenement becomes owner of both properties
- by release of the right to easement to the owner of the servant tenement
- abandonment of the easement to the owner
- non use of prescritpive easement
- destruction of the servant tenement
- lawsuit
- property conversion
License
a personal privilege to use someone else’s land. Example: hunting license. Can be terminated or canceled by the licensor (the person who granted the license) at any time.
