Chapter 5

Question 1

What are the four ways an interest in personal property can be acquired?

Answer 1

1) creation or purchase by owner - build a brewery
2) accession (increase or addition) barley into beer
3) confusion (intermingling of fungible goods … 2 farms combine resources)
4) gift
5) bailment

Question 2

What is the relative value test?

Answer 2

If the value of the finished product greatly exceeds the value of the original goods, an innocent party who makes improvements may retain title to the product and pay the owner the reasonable value of the original goods.

Question 3

What happens in the case of accidental confusion?

Answer 3

The parties jointly own the goods in proportion to original ownership interests.

Question 4

What are the three elements of a gift?

Answer 4

1) donative intent to make a present gift
2) delivery
3) acceptance

Question 5

What is the term of a copyright?

Answer 5

Author’s lifetime plus 70 years for general copyrights and 95 years for works made for hire and works copyrighted before 1978.

Question 6

What is the term of a patent?

Answer 6

17 years.

Question 7

What duty of care is owed by the bailee in the following situations?

1) only bailee benefits
2) only bailor benefits
3) both benefit

Answer 7

1) extraordinary care.
2) slight degree of care
3) reasonable care under the circumstances

Question 8

What is the doctrine of negligent entrustment?

Answer 8

A bailor is responsible for the bailee’s negligence if the bailor entrusts an incompetent bailee. (ex. drunk driver)

Question 9

What are the three types of property ownership interests?

Answer 9

1) Fee Simple estates
2) Life Estates
3) Concurrent Estates

Question 10

How does a life estate work?

Answer 10

Last only for the life of the donee (life tenant) or another specified person. The life tenant has exclusive possession (but not ownership) of the land and may keep all income
it produces. He can not transfer more than his interest.

Question 11

Can a joint tenancy a) be severed by sale? b) be mortgaged c) be subject to individual creditors of joint tenants?

Answer 11

a) can be severed by sale
b) may be mortgaged
c) is subject to individual creditors of the joint tenants

Question 12

Can tenancy by the entirety be a) be severed by sale? b) be subject to individual creditors of joint tenants?

Answer 12

a) cannot be severed by sale .. is severed by divorce

b) is not subject to individual creditors

Question 13

A shared interest in property that may be sold or willed.

It may be held in unequal shares and may be created by more than one transaction.

Answer 13

tenancy in common

Question 14

What is community property?

Answer 14

Property acquired by a husband and wife with shared funds (either’s income, neither’s inheritance) during their marriage.

Question 15

What are the three requirements of a contract of sale for real property?

Answer 15

1) writing and the signatures of the vendor and vendee
2) essential terms (description of premises and its price)
3) unessential terms (time of closing, etc)

Question 16

What is a quit-claim deed?

Answer 16

Transfers whatever ownership rights, if any, the grantor has and contains no warranties.

Question 17

What is a general warranty deed?

Answer 17

contains the grantor’s warranties (covenants) that the title is free of any encumbrance, that he has the title
being transferred, and that no one else has better title.

Question 18

What is a special warranty deed?

Answer 18

the grantor warrants that the title is free of any encumbrance since he took title.

Question 19

What is a bargain-and-sale deed?

Answer 19

transfers specific ownership rights like a warranty deed, but does not contain warranties of title.

Question 20

Why aren’t cooperative ownership and condominium ownership strictly concurrent ownerships

Answer 20

Owners do not have equal rights to the entire property.

Question 21

What are the requisites for a deed?

Answer 21

1. be in writing;
2. be signed by a named and legally competent grantor;
3. specify the grantee, the consideration, and the property rights conveyed;
4. include the date;
5. contain a paragraph that states who transferred the property to the grantor, when it was transferred, and where that deed is recorded;
6. include words of conveyance; and
7. be delivered to the grantee.

Question 22

Is a buyer of a property liable for mortgage payments if he takes the property ‘subject to’ the mortgage?

Answer 22

No

Question 23

Is a buyer of a property liable for mortgage payments if he ‘assumes the mortgage?’

Answer 23

Yes

Question 24

How does a land contract work?

Answer 24

Buyer takes possession of land and pays taxes and insurance. Only gets title after certain percentage is paid.

Question 25

How does a trust deed work?

Answer 25

Land is transferred from borrower (trustor) to a trustee for the benefit of beneficiaries (bondholders).

Question 26

What are the positives and negatives of a trust deed?

Answer 26

Positives: allows borrowing large sums of money, easier to sell, may be foreclosed without court proceeding.
Negative: May be difficult to administer if there are a large number of beneficiaries.

Question 27

What does a general contractor have to show to assert a lien?

Answer 27

1. substantial performance of the contract,
2. improvement of a specific piece of property under the contract, and
3. specific mention in the contract of the property to be improved.

Question 28

What info does a notice of (mechanic’s) lien contain?

Answer 28

1. the amount claimed,
2. the claimant’s name and address,
3. the type of improvement,
4. a description of the land, and
5. the owner’s name.

Question 29

How do mechanic’s liens attach in most states?

Answer 29

all mechanics’ liens from a project relate back to the day the project started–even liens of subcontractors who were hired later. All mechanics’ liens will take priority over a mortgage that was filed the day after the work started.

Question 30

What does a party have to have to create an adverse possession grant of full title?

Answer 30

a. exclusive,
b. open and obvious,
c. hostile (without the owner’s permission)
d. possession and use of property
e. for a continuous period (specified by statute),

Question 31

When does a property owner have the right to lateral and subjacent support?

Answer 31

When the bordering land is natural.

Question 32

When does personal property become a fixture?

Answer 32

a. attached to real property in such a way that its removal would cause substantial injury to the real property or the fixture,
b. machinery necessary for the operation of the building,
c. intended to become real property by the party installing it.

Question 33

the nonpossessory right to use another’s property for a particular purpose that benefits adjacent property; can be created by express words, by implication, or by adverse
possession.

Answer 33

easements

Question 34

Zoning that prohibits additional buildings or requires high standards.

Answer 34

exclusionary zoning

Question 35

A use permitted by the ordinance but subject to limitations; often granted for the general welfare, such as churches and schools.

Answer 35

special exception

Question 36

This may be granted in a situation in which, because of size, topography, or other physical limitations, a given lot does not conform to the ordinance.

Answer 36

hardship variance

Question 37

This permits an otherwise prohibited use within the zone.

Answer 37

use variance

Question 38

If John has a convenience store in an area where the zoning is changed, does he have to close shop?

Answer 38

No. A nonconforming use is allowed to continue.

Question 39

What does eminent domain require?

Answer 39

A condemnation proceeding and fair compensation.

Question 40

A tenancy that automatically renews without a termination date. It can be created by express agreement or by a holdover tenant.

Answer 40

Periodic tenancy

Question 41

What are a landlord’s rights?

Answer 41

1) recover property in same condition less wear and tear.

2) recover rents when due

Question 42

When can a tenant be relieved of paying rent.

Answer 42

Constructive eviction.
Asks landlord to remedy
Leaves the premises.

Question 43

When a landlord removes tenant’s possessions and changes lock.

Answer 43

self-help eviction

Question 44

When a court sanctions, enforces and effects an eviction.

Answer 44

summary eviction

Question 45

when a landlord peacefully seizes and sells possessions for defaulted rent.

Answer 45

distraint.