Classification of estate interest

Question 1

A fee simple absolute is

Answer 1

An outright ownership of the property by the grantee and grantee’s heirs
-cannot be divested

Question 2

What are the types of present interest?

Answer 2

1. Fee
2. Life
3. Term

Question 3

the following words are needed to create a fee simple absolute

Answer 3

A conveyance is presumed to be fee simple absolute (e.g. from A to B)

Question 4

A defeasible fee estate is:

Answer 4

A fee estate that can terminate upon the happening of some event

Question 5

A determinable estate is created by

Answer 5

When the grantor uses durational language

e.g. until, while, so long as

Question 6

How does a determinable estate terminate?

Answer 6

A determinable estate terminates automatically on the happening of a named future event

Question 7

A Fee Simple Subject to a Condition Subsequent can be created when?

Answer 7

When the grantor uses conditional language

e.g. on condition, provided, but if

Question 8

If language is ambiguous for defeasible estates, then treat as

Answer 8

Fee Simple Subject to a Condition Subsequent

Question 9

Fee Simple Subject to Executory Interest Can be created by?

Answer 9

Conditional language or durational

If the condition or duration happens, then reverts to a third party

Question 10

What is a Fee Tail? Legality?

Answer 10

Attempt to limit ownership of property to lineal descendents
-void

Question 11

How to read: A to B and the heirs of his body?

Answer 11

A to B

-fee tails are void; gives in fee simple absolute

Question 12

A life estate lasts:

Answer 12

estate that lasts for the duration of someone’s life

Question 13

A life estate pur autre vie is:

Answer 13

when someone other than the grantee is the measuring life

If tied to multiple people, both must die before reversion

“A to B for the life of C.”
If B dies before C, it becomes part of B’s estate and will continue so long as C is still alive.

Question 14

Defeasibility of life estate

Answer 14

Life estates can be made defeasible.

Question 15

A term estate is:

Answer 15

When someone owes a property that is not determined by the length of someone’s life

Example: “A to B for 50 years.” “A to B for 1 year.”

Question 16

A possibility of reverter is:

Answer 16

The future interest created whenever the grantor creates fee simple determinable
(durational language) –> automatically created

Question 17

If grantor uses durational language, upon the happening event what happens

Answer 17

Automatically reverts back to grantor

Question 18

Future interest in prop can go where

2

Answer 18

1. To grantor

2. To third party

Question 19

Type of future interest grantor can have

3

Answer 19

1. Possibility of Reverter
2. Right of Entry/Power of Termination
3. Reversion

Question 20

Type of future interest a third party can have

2

Answer 20

1. Executory interest

2. Remainder

Question 21

Transferability of possibility of reverter?

Answer 21

Freely transferable

Question 22

A right of reentry(power of termination) is:

Answer 22

the future interest that can be created in the grantor when the grantor attempts to create a fee simple to a condition subsequent

Question 23

How to create a right of reentry?

Answer 23

Has to be spelled out right of re-entry in the conveyance or it does not exist

(becomes a fee simple if there is just the condition)

EXAMPLE: “A to B provided that B uses the premises for residential purposes.” If B ever stops using the premises for residential purposes, A or A’s heirs can enter and retake the property.

Question 24

Difference between right of reentry and possibility of reverter

Answer 24

Has to be spelled out v. automatically created

Question 25

How to enforce a right of reentry?

Answer 25

Upon the happening of the condition, the grantor has to exercise the right of reentry to take the property back from grantee

Question 26

What happens when condition occurs in a fee simple to a condition subsequent when right of reentry is not spelled out?

Answer 26

The property cannot be taken; however, the grantor can file breach of contract claim for damages

Question 27

A reversion is

Answer 27

≠ right of reentry and possibility of reverter + Any other situation where grantor leaves a gap in ownership of property = a future interest created in the grantor when they have not fully conveyed the property (fills in gaps)

Question 28

An executory interest is:

Answer 28

a future interest created in favor of a third party that **cuts short*** the preceding estate before it would naturally have terminated

Question 29

Every future interest that cuts a fee short will be?

Answer 29

an executory interest

Question 30

A remainder is:

Answer 30

a future interest that follows **naturally*** the preceding estate

Question 31

A Contingent Remainder is

Answer 31

any remainder that is not vested An interest that could be taken away EXAMPLE: “A to B for life, then to the oldest child of C then living.” Would be a contingent remainder. We don’t know who the oldest child is going to be until B dies. There is a condition precedent to that person taking—they must be alive when B dies.

Question 32

A Vested Remainder is | 2

Answer 32

An interest that cannot be taken away 1. The remainder must be created in an ascertainable person 2. There must not be any condition precedent other than termination of the preceding estate.

Question 33

A vested remainder subject to condition subsequent or vested remainder subject to complete divestment is:

Answer 33

A vested remainder that could be lost entirely after the ascertainable person receives the property (condition on the vested remainder)

Question 34

A vested remainder subject to open, sometimes called a vested subject to partial divestment, is:

Answer 34

Class gift situation If the class is open, the more that come in diminish the ownership of the others.

Question 35

How are class openings created?

Answer 35

A class is deemed to open the moment the class opens 1. inter vivos conveyance = when it is made 2. testamentary conveyance = when testator dies Rights do not vest until the class is open

Question 36

When does a class close?

Answer 36

class closes as soon as at least one member of the class comes into immediate possession of the land EXAMPLE: “A to B for life, remainder to the children of C.” When B dies, C has two children living. Those two children would be entitled to take immediate possession of the property. This would close the class. If any other children of C are born after that point, they are shut out of the class.

Question 37

Rule of Convenience

Answer 37

a class closes as soon as at least one member of the class comes into immediate possession of the land -if there is a potential member that is alive but has to satisfy a condition precedent to join the class, they are allowed to do so even after the class is closed EXAMPLE: “A to B for life, then to the children of C who reach the age of 25.” At B’s death, C has two children: one is 30 and one is 20. A year after B dies, another child is born to C. 30 year old has a vested remainder—ascertainable, over the age of 25—and can go into immediate possession. This closes the class. Any child who is alive but has not satisfied the condition may try to do so. If the 20 year old reaches 25, he will join the class. The child born a year after B died is shut out.

Question 38

Doctrine of Worthier Title

Answer 38

“A to B for life, remainder to A’s heirs.” Whether or not A included “remainder to A’s heirs,” the property would have gone to A’s heirs via a reversion. Should pass by descent rather than the devise. Do not include “remainder to A’s heirs" to effectuate the transfer to A's heirs, just have a descent ransfer

Question 39

Waste determines

Answer 39

what someone who owns land can or cannot do with it

Question 40

When is an owner of property prohibited from committing waste?

Answer 40

when they are someone who has less than a fee estate | term, life

Question 41

Voluntary Waste

Answer 41

Volitional Act a tenant cannot intentionally or negligently damage property attached to it that would damage a later interest

Question 42

Permissive Waste

Answer 42

The life tenant must take reasonable steps to guard against damage the property, when they fail to do so and damage results, this is permissive waste. Failure to act

Question 43

Three types of waste?

Answer 43

1. Voluntary waste 2. Permissive Waste 3. Ameliorative waste

Question 44

What is Ameliorative waste?

Answer 44

the tenant makes improvements to the land - common law: tenant could be sued to return to original condition - modern law: tenant allowed

Question 45

Modern law allows ameliorative waste if? | 3

Answer 45

Allowed 1. market value of the property is not impaired + either 2. permission of remainder man; or, 3. change to neighborhood that justifies improvement

Question 46

Who has standing to sue for waste?

Answer 46

holder of a remainder

Question 47

For waste, A vested remainderman can sue for?

Answer 47

1. damages; and, or, | 2. injunction to stop future waste

Question 48

For waste, a contingent remainderman can sue for?

Answer 48

only an injunction to stop future waste

Question 49

A total restraint on alienation is?

Answer 49

if you try to sell property, then you lose the property

Question 50

A total restraint on a fee? A total restraint on less than a fee?

Answer 50

On a fee is void If less than a fee, will be upheld if reasonable

Question 51

A partial restraint on alienation is? | 2

Answer 51

1. purchase option 2. right of first refusal Both are valid if reasonable under the circumstances

Question 52

rule against perpetuities only applies to? | 5

Answer 52

(1) Does not apply to present estates. (2) Only applies to three future interests: (a) executory interest (b) contingent remainder (c) vested remainder subject to open (3) Two other interests are subject to the rule: (a) purchase option (b) right of first refusal (4) All other future interests are exempt.

Question 53

What to examine in rule against perpetutities analysis?

Answer 53

At the time of creation, is there a possibility?

Question 54

If rule against perpetutities applies, what is the analysis?

Answer 54

Can I create an interpretation under the facts that someone can be claiming under one of those interests more than 21 years after everyone currently alive is dead?

Question 55

What happens when rule against perpetutities wipes out an interest?

Answer 55

Read the conveyance omitting the voided interest

Question 56

Joint tenancy is

Answer 56

a form of concurrent ownership, where each co-tenant owns an undivided interest in the whole of the property + has a right of survivorship.

Question 57

Tenancy in common is

Answer 57

common is a form of concurrent ownership, where each co-tenant owns an undivided interest in the whole of the property.

Question 58

Key difference between joint tenancy and tenancy in common?

Answer 58

Joint tenancy creates a right of survivorship

Question 59

Any conveyance to two or more people is presumed to create what unless specifically stated otherwise? Common law? Majority?

Answer 59

Common Law: Joint Tenancy Majority: Tenancy in common

Question 60

How to specifically state otherwise that a conveyance to two or more people is a joint tenancy?

Answer 60

- with the right of survivorship | - as joint tenants

Question 61

The right of survivorship says that:

Answer 61

upon the death of joint tenant, the property automatically transfers to the remaining joint tenant(s)

Question 62

What wins: right of survivorship v. will

Answer 62

right of survivorship > will

Question 63

How to create a joint tenancy? | 2

Answer 63

unity of interest: each joint tenant must have an equal ownership interest in the property unity of possession: each joint tenant must have the equal right to possess the entire parcel

Question 64

How to create a tenancy in common?

Answer 64

unity of possession: each tenant in common must have the equal right to possess the entire parcel

Question 65

Main differences between joint tenancy and tenancy in common | 2

Answer 65

JT 1. has right of survivorship 2. each JT must have = interest

Question 66

Tenancy by the Entirety is

Answer 66

a joint tenancy only between a husband and a wife

Question 67

What happens to tenancy by entirety in event of divorce?

Answer 67

Severs the JT and becomes tenancy in common

Question 68

How to sever a joint tenancy? | 3

Answer 68

Done by an inter vivos act of one of the parties. 1. partition action to court to create tenancy in common 2. contracting to sell interest in property 3. if joint tenant mortgages their interest in land

Question 69

What happens when a joint tenancy is severed?

Answer 69

becomes a tenancy in common

Question 70

What happens when a joint tenant contracts to sell interest in a property or mortgages the property?

Answer 70

Joint tenancy remains intact between remaining joint tenants + Interest sold is held as a tenancy in common between all parties

Question 71

if joint tenant mortgages their interest in land, what happens (lien theory v. title theory)

Answer 71

Transferring a lien on property will not severe tenancy Transferring a title on property will severe tenancy

Question 72

Rights and Duties of Co-Tenants

Answer 72

1. Each co-tenant is entitled to possess the whole property. 2. Profits 3. Expenses

Question 73

If a co-tenant is denied such whole property possession, what can they do

Answer 73

can sue for damages or ejectment

Question 74

If profits produced by one of the co-tenant’s efforts, then how is it split

Answer 74

stays with the co-tenant who earned it; unless, co-tenant prevented the other from entering the land --> then owed a share

Question 75

If profits generated by what a third party is doing with the property (rent), what is split to co-tenant?

Answer 75

pro rata share of rent

Question 76

What is a co-tenant's liability to taxes/mortgage payments?

Answer 76

pro rata share of taxes/mortgage payments | -the one who is in primary occupation has primary obligation

Question 77

What is a co-tenant's liability for repairs?

Answer 77

There is no duty of repair placed upon a co-tenant - it is at their own expense and cannot put on co-tenants - if rented, can offset repairs against third-party rents before the pro-rata distribution

Question 78

What is a co-tenant's liability for improvements?

Answer 78

There is no duty of improvement placed upon a co-tenant | -however, if the improvement creates increased sale price + sold then, increase goes to co-tenant

Question 79

How can a tenancy at will be terminated?

Answer 79

1. landlord conveying interest; 2. death of either party 3. landlord leasing property to someone else 4. tenant causing place to fall into disrepair