Easements

Question 1

What are the five kinds of easeaments?

Answer 1

(1) express easement; (2) implied easement by prior existing use; (3) easement by necessity; (4) Prescriptive easement; (5) easement by estoppel (or irrevocable license)

Question 2

What is an appurtenant easement?

Answer 2

an easement that benefits the easement holder in using the dominant land as the owner of the dominant land. It is seen as attached to the dominant land. It exists only when there is both dominant and servient land.

Question 3

What is an easement in gross?

Answer 3

an easement that is not connected to the holder’s use of any particular land; rather it is personal to the holder whether or not he owns any other parcels of land. It is attached to the holder not the land. It only involves servient land.

Question 4

What is an affirmative easement?

Answer 4

An easement that allows the holder to perform an act on the servient land.

Question 5

What is a negative easement?

Answer 5

an easement that allows the holder to prevent the servient owner from performing an act on the servient land.

Question 6

What is a license compared to an easement?

Answer 6

A license is an informal permission that allows the holder to use the land of another for a particular purpose. No interest in the land and can be revoked at any time. Whether a right is a license or an easement turns on the intent of the parties. In Markstein, the court considered the manner in which the right was created, the nature of the right created, the duration of the right the amount of consideration given for the right, and whether there is a reservation of power to revoke the right.

Question 7

A deed must meet the statute of frauds (T or F)?

Answer 7

True

Question 8

How does a deed for an easement meet the statute of frauds?

Answer 8

(a) must be in writing, (b) identify the grantor and grantee, (c) contain words manifesting an intention to create an easement, and (d) describe the affected land, and (e) be signed by the grantor.

Question 9

How is an express easement created?

Answer 9

It arises only with the agreement of the owner whose land is burdened. The other four arise as a matter of law w/o the owner’s agreement.

Question 10

What are the required elements for an express easement?

Answer 10

(1) an easement that does not give the holder any right to possess the land, just use for a limited purpose; (2) subject to statute of frauds; (3) burdens land that is possessed by another person.

Question 11

What is an implied easement by prior existing use?

Answer 11

An easement that can arise without an express agreement to create an easement. A court may infer such intent from the presence of an existing use (e.g. powerlines crossing servient land) and imposed an easement by operation of intention to not create an easement, this easement cannot arise.

Question 12

What are the three required elements for an implied easement by prior existing use?

Answer 12

(1) severance of title to land in common ownership; (2) an existing, apparent and continuous use when severance occurs, and (3) reasonable necessity for the use at time of severance (use was reasonably convenient to the dominant land). (4) elements must be satisfied at time of severance.

Question 13

What is an easement by necessity?

Answer 13

when a piece of land is landlocked (no access to public road), an easement by necessity arises by operation of law based on the circumstances of the case, without any express agreement. It is an exception to the SoF. Requires an existing use before severance of title; the easement by necessity when title is severed but not prior use.

Question 14

What are the two required elements of an easement by necessity?

Answer 14

(1) severance of title to land held in common ownership; and (2) strict necessity for the easement at time of severance (requires the parcel to be landlocked with no other access to public roads or utilities). Any route, no matter how impractical, destroys the claim.

Question 15

What is a prescriptive easement?

Answer 15

The easement version of adverse possession. It proves the easement holder an easement in land owned by another.

Question 16

What are the required elements for easement by prescription?

Answer 16

(1) actual use as a true holder would use the easement; (2) open and notorious use where it was visible and obvious in such a way that would be aware of the adverse use; (3) adverse use, without permission of owner of servient land; (4) continuous use, use was continuous as a true holder would; (5) statutory period; (6) if no statutory period then we default to 20 years; note AP style tacking works here too.

Question 17

What is an easement by estoppel (irrevocable license)?

Answer 17

An easement that arises when a licensee expends substantial money or labor in reasonable reliance on the license and the licensor should reasonably expect such reliance, the licensor is estopped from revoking it.

Question 18

What are the element of easement by estoppel (irrevocable license)?

Answer 18

(1) a license, typically for access purposes; (2) the licensee expended substantial money or labor in good faith reliance; and (3) the licensor’s knowledge or reasonable expectation that reliance will occur.

Question 19

Do easements survive transfer of the servient land?

Answer 19

Yes, unless the grantee is a bona fide purchase

Question 20

Are easements in gross transferable?

Answer 20

Only if it serves a commercial purpose

Question 21

Are appurtenant easements transferable?

Answer 21

Because they are are seen as attached to land, the benefit of the easement automatically transfers to the grantee.

Question 22

How does an appurtenant easement transfer?

Answer 22

when the servient land is conveyed, the easement remains attached to the land so long as (1) it runs with the land; (2) notice to the burdened property owner either (a) actual; (b) record; or (c) inquiry

Question 23

How does an easement in gross transfer?

Answer 23

only commercial easements in gross are freely transferable; non-commercial easements in gross are not transferable.

Question 24

What is an equitable servitude?

Answer 24

A promise related to land use (e.g. height restriction for building) that runs with the land in equity unless the purchaser is a bon fide purchaser.

Question 25

What is a bona fide purchaser?

Answer 25

A subsequent purchaser for value without notice of the covenant

Question 26

How should you approach horizontal and vertical privity?

Answer 26

(1) identify the promise; (2) identify the burden/benefit; (3) identify the successors

Question 27

What is the remedy for violation of a real covenant?

Answer 27

Traditionally, money damages.

Question 27

What is a real covenant?

Answer 27

a promise concerning the use of land that benefits and burdens both the original parties to the promise and their successors

Question 27

What does the FHA of 1968 generally prohibit?

Answer 27

Discrimination in the sale or rental of dwelling based on protected classes including pregnant people or disabilities.

Question 28

What specific conduct is prohibited by the FHA of 1968?

Answer 28

Refusing to rent, sell, or negotiate or providing different terms, conditions or privileges based on a protected status.

Question 29

Does the FHA prohibit publishing advertisements with preferences for prospective tenants or buyers?

Answer 29

Yes, and the two exception for certain dwellings do not apply to this prohibition.

Question 30

What is considered a dwelling under the FHA act of 1968?

Answer 30

Any building, structure, or portion thereof which is occupied as, or deigned or intended for occupancy as, a residence by one or more families.

Question 31

What kinds of dwellings are exempt from the FHA provisions of sale, rentals, and negotiations?

Answer 31

(i) owner-occupied apartment up to four units or (ii) single-family residences rented or sold without a real estate broker or salesperson

Question 32

The owner occupied and single-family residence exemptions apply to advertisements (T or F)?

Answer 32

False, advertisements cannot discriminate on the basis of protected class regardless of the size/owner seller exceptions.

Question 33

What does the Civil Rights Act of 1886 apply to?

Answer 33

(i) prohibits discrimination on the basis of race in the leasing or sale or any type of property; however, it does not cover advertising; (ii) applies to intentional discrimination

Question 34

Does the FHA apply to roommate arrangements?

Answer 34

No, it does not apply to shared living units.

Question 35

What is a covenant?

Answer 35

An agreement among owners that a parcel or multiple parcels of land will be used in a certain way (real covenant or equitable servitudes)

Question 36

What is an express easment?

Answer 36

An easement created by agreement and in writing

Question 37

What is an implied easement and what are the four types?

Answer 37

Easements created by operation of law. The four kind are implied by prior existing use, easement by necessity, prescriptive easement, easement by estoppel (or irrevocable license)

Question 38

What is the scope of an easement?

Answer 38

it depends on the intent of the original parties, but generally an easement holder may do anything that is reasonably necessary for the full enjoyment of the easement, unless evidence provides otherwise.

Question 39

Can an easement be expanded?

Answer 39

Generally, an easement holder may increase the manner, frequency, or intensity of an easement’s use so long as that increase does not unreasonably damage or interfere with the use or enjoyment of the servient estate.

Question 40

Can prescriptive easements be expanded?

Answer 40

Generally, no because the creation is not based on the intent of the parties.

Question 41

Can the change in technology increase the scope of an easement?

Answer 41

Yes, easements generally expand to accommodate technological change such as telephone lines or cable TV lines.

Question 42

What happens to an easement when the dominant land is subdivided?

Answer 42

every lot owner in the subdivision is entitled to use any easement appurtenant to the dominant land, BUT the easement cannot unreasonably burden the servient land.

Question 43

Can an easement holder benefit a third-party?

Answer 43

No. In general, an easement holder cannot use the easement to benefit any other parcel other than the dominant land.

Question 44

What is the mnemonic for ways that an easement can terminate?

Answer 44

TAMPER

Question 45

What are the six way an easement can terminate?

Answer 45

(1) Terms of an easement;
(2) Abandonment;
(3) Merger;
(4) Prescription;
(5) Estoppel;
(6) Release

Question 46

How does an easement terminate under terms of an easment?

Answer 46

The parties can include an express limitation to the easement, such as expiration date, term of years, or a condition.

Question 47

How does an easement terminate under abandonment?

Answer 47

depends on the easement holder’s intent but abandonment is established if the holder (a) stops using the easement for a long period, and (b) takes other actions that clearly show intent to relinquish the easement.

Question 48

How does an easement terminate under merger?

Answer 48

If one person obtains title to both the easement and the servient land, the easement terminates under the doctrine of merger; however, it only suspends the easement when there are future interest in the dominant land or servient estate.

Question 49

How is an easement terminated through prescription?

Answer 49

through the same elements as an easement by prescription, except the servient owner must substantially interfere with the holder’s use of the easement.

Question 50

How does an easement terminate under estoppel?

Answer 50

if the servient owner substantially changes his position in reasonable reliance on the holder’s statement that the easement will nto be used in the future.

Question 51

How is an easement terminated through release?

Answer 51

the easement holder may release the easement to the servient owner by executing and delivering a writing that complied with the SoF.

Question 52

Who has the duty repair and maintain an easement?

Answer 52

On the easement holder unless the parties agree otherwise. However, the servient estate owner has a duty to contribute to the reasonable costs of repairs and maintenance if they use the easement.

Question 53

Who is a real estate broker?

Answer 53

an agent who represents a principal who is selling real proeprty

Question 54

how do real estate agents/brokers make money?

Answer 54

they earn a commission based on the listing agreement

Question 55

What are the three basic types of listing agreements?

Answer 55

(1) open listing where the seller pays first broker to find a “ready, willing, and able buyer”;
(2) exclusive agency listing where the broker is the only one authorized to find buyers, but no commission if the seller finds a “ready, willing, able buyer”
(3) exclusive right to sell listing where a broker receives a commission even if anyone finds a “ready, willing, and able buyer”

Question 56

Do purchase contracts have to meet the SoF?

Answer 56

Yes, there must be:
(1) a writing;
(2) signed by the party to be bound
(3) that contains the essential terms which include the identify of the parties, the price, and description of the property

Question 57

What are the essential terms of a purchase contract?

Answer 57

(1) identity of the parties;
(2) the price;
(3) description of the property

Question 58

What are two exceptions to the SoF for purchase contracts?

Answer 58

(1) Part Performance;
(2) Estoppel

Question 59

What is part performance?

Answer 59

in general, an oral contract for the sale of real property cannot be enforced. however, it can be enforced through specific performance if part performance occurs.

Question 60

How does part performance work?

Answer 60

If two of the following are satisfied, part performance can be used as an equitable remedy to force specific performance of a contract:
1. Buyer takes possession of the real property;
2. Buyer makes substantial improvements to the real property;
3. Buyer makes a payment of some or all of the purchase price to the Seller`

Question 61

What is Estoppel in a purchase conract?

Answer 61

The doctrine focuses on the equities between the parties. In general, an oral contract for the sale of real property may be enforced so long as both elements are satisfied.

Question 62

What are the two elements for the equitable remedy of estoppel?

Answer 62

(1) Buyer substantially changes their position in reliance on an oral promise by the Seller; AND
(2) Buyer will be substantially injured if specific performance is not granted.
- e.g. oral contract for a home so you sell your own and now you can’t afford another home elsewhere

Question 63

What is marketable title?

Answer 63

Title to real property that is reasonably free from doubt, i.e. title that a reasonably prudent buyer would be willing to accept. Does not need to be perfect but must be free from questions that might present an unreasonable risk of litigation.

Question 64

How does marketable title arise?

Answer 64

It is an implied covenant and implied condition in a purchase and sale contract.

Question 65

Whys is marketable title important?

Answer 65

If it is unmarketable, then Buyer can rescind the purchase and sale contract. Unmarketable title allows only Buyer to rescind, not seller

Question 66

What makes a title unmarketable?

Answer 66

(1) Problem with title (e.g. less property interest than identified in contract, or subject to encumbrance even if recorded, unless in K.)
(2) Risk of litigation due to uncertainty of title, violation of law, violation of a private covenant;
(3) Must be a substantial problem; not immaterial defect

Question 67

When is title NOT Unmarketable?

Answer 67

1. If parties agree to terms such as
   a. contract indicates “no promises re marketable title”
   b. purchase K explicitly lists encumbrance or potential litigation
   c. Zoning restrictions (unless violated)
   d. Visible easements for roads, power lines, sewer pipes or other utilities.
2. Physical defects: marketable title concerns “title” to property, not the physical condition.

Question 68

What is the executory period in a purchase contract?

Answer 68

The period of time after the parties sign but before the closing date. During this time, the seller’s title is examined, the condition of the property is evaluated, financing for purchase is obtained, escrow account is opened to consummate the transaction, and the deed/mortgage/promissory note/and escrow instruction are prepared.

Question 69

If a problem with title is discovered during the executory period, can the buyer rescind the purchase contract?

Answer 69

No, if possible, the Seller has until closing to fix the problem with title

Question 70

If the seller is not able to cure problems with title during the executory period, can the Buyer rescind the purchase contract?

Answer 70

No, if the purchase and sale contract does not have a “time is of the essence clause”, the Seller has a reasonable time to cure after the closing date (1-2 months but the longer the problem has been known to the seller the less time is permitted).

Question 71

If a problem with title is discovered, and a time is of the essence clause is present, what happnes?

Answer 71

The seller must provide marketable title at closing.

Question 72

If it is obvious that a problem with title cannot be cured prior to closing, what can the Buyer do?

Answer 72

Rescind the contract due to the unmarketable title prior to closing (e.g. one-story house can’t become a two-story house in one week.

Question 73

What defects must a seller disclose?

Answer 73

1. a defect that is known to the seller or has reason to believe;
2. the defect is not known or not readily discoverable by a Buyer exercising due care (latent defects), and
3. the defect materially impacts the value of the contract.

Question 74

What are the two cardinal sins of sales contracts?

Answer 74

1. misrepresentation;
2. Active concealment

Question 75

Is misrepresentation allowed?

Answer 75

No intentional misrepresentation is permitted, either oral or written

Question 76

Is active concealment allowed?

Answer 76

No active concealment is permitted, even if not oral or written statement (e.g., no putting paint over large hole in the wall)

Question 77

What are the elements of active concealment?

Answer 77

(1) false statement or active concealment of material fact made by the seller to buyer;
(2) known to the seller to be false;
(3) made with the intent to induce buyer to purchase;
(4) which the buyer justifiably relies on in deciding to buy

Question 78

Are “as-is” clauses enough to overcome Seller’s liability for failure to disclose or fruad?

Answer 78

Majority rule says no. Minority says yes. Commercial real estate, usually enforceable.

Question 79

Are specific “as is” clause (waiver) enough to disclaim liability of a seller?

Answer 79

If the “as is” clause identifies and disclaims liability for specific types of defects, it is likely to be upheld.

Question 80

What is a seller or buyer breach?

Answer 80

when either seller or buyer refuse to go through with the transaction (justifies remedies)

Question 81

What can happen as a result of a seller’s breach?

Answer 81

Justifies buyer’s rescission and other remedies; failure to deliver marketable title, to disclose when obligated to disclose, failure to comply with any conditions included in the purchase contract (e.g. Seller promises to paint building)

Question 82

What qualifies as buyer’s breach?

Answer 82

failure to comply with any conditions included in purchase contract (e.g., buyer must maintain the site during the executory period); can result in rescission and other remedies

Question 83

What is the buyer’s remedy for refusal to perform the purchase and sale contract?

Answer 83

Specific performance if money damages are inadequate as a remedy for buyer; court’s typically presume money damages are inadequate because real property is unique, and thus court’s usually grant buyer’s request for specific performance.

Question 84

What is the seller’s remedy for refusal to perform the purchase and sale contract?

Answer 84

Specific performance if money damages are inadequate as a remedy for sellers.

Question 85

What are the different kinds of damages for breach of the purchase and sale contract?

Answer 85

1. restitutions damages: original position
2. reliance damages: expenses from reliance
3. consequential damages: foreseeable damages to non-breaching property if reasonably certain
4. liquidated damages: written
5. Expectation damages

Question 86

What are expectation damages?

Answer 86

difference between contract price and FMV on date of breach

Question 87

What is the equitable conversion doctrine?

Answer 87

the idea that once the purchase contract is entered into, it converts the legal right to property from seller to buyer. i.e. buyer gets equitable right to real property while seller get legal right to payment;
Note: risk of loss is passed to the buyer and must pay contract price if property destroyed during executory period

Question 88

What if the buyer or seller dies during the executory period?

Answer 88

the contract is still value and is still enforceable by the beneficiary of either party.

Question 89

What are the requirements of a valid deed?

Answer 89

1. SoF (writing signed by grantor) (expcetions of part performance and equitable estoppel)
2. Must state parties, words indicating conveyance, description/identification of the property

Question 90

What are considered nonessential components of a deed?

Answer 90

Consideraition, Habendum clause of encumbrances, servitudes, or subject to all restrictions of record, warranties of title, recording, notary public acknowledgment

Question 91

What are the key elements of delivery of a deed?

Answer 91

1. grantor manifest’s intent to transfer an immediate property interest (present of future) to the grantee;
2. grantee acceptance of the deed (usually presumed)

Question 92

Delivery of a deed rebuttable (T or F)?

Answer 92

True

Question 93

Can physical delivery be rebutted?

Answer 93

there is a rebuttable presumption that it was delivered; if no physical delivery then there is a rebuttable presumption that it was not delivered; if recorded; rebuttable presumption that delivered (hard to rebut)

Question 94

When do wills take effect?

Answer 94

At testators death

Question 95

Can deeds function as will stubstitutes?

Answer 95

No, they require present and irrevocable conveyance

Question 96

What is estoppel by deed?

Answer 96

Provides that if a seller conveys property with a warranty deed before they have title to it, then , when they later obtain the property, they are are estopped from claiming title. As a consequence, the grantee gets title.

Question 97

What protections do buyers have against potential title defects that don’t emerge until after closing?

Answer 97

1. Title covenants: grantor promises in deed that title is good in deed warranties
2. Recording system: state of title based on searching public land recording
3. Title insurance: pay for title insurance company policy that insures grantee’s title

Question 98

What is the merger doctrine in the context of marketable title?

Answer 98

• Warranty of marketable title expires at closing; title promises in the purchase contract “merge” into the deed (disappear)
• post-closing, deed warranties (containing title covenants) apply to actual issues that arise (not based on doubt as to risk of litigation as in marketable title)

Question 99

What are the three common types of deeds?

Answer 99

1. General Warranty Deed;
2. Special Warranty Deed
3. Quitclaim deed

Question 100

What is a general warranty deed?

Answer 100

the grantor warrants title against all the facts, whether they arose before or after they obtained title

Question 101

What is a special warranty deed?

Answer 101

the grantor warrants title against all defects that arose after they obtained title

Question 102

What is a quitclaim title?

Answer 102

the grantor makes no warrantee about title, so the grant he receives, only what the grantor has, if anything

Question 103

What are the standard covenants?

Answer 103

A. Present Covenants
1. Covenant of seisin;
2. Covenant of right to convey;
3. Covenant against encumbrances
B. Future Covenants
1. Covenants of warranty
2. Covenant of quiet enjoyment
3. Covenant of further assurances

Question 104

What do title recording keep track of?

Answer 104

1. sales
2. transfer by will or intestate succession;
3. mortgages;
4. leases;
5. servitudes;
6. Creditor liens

Question 105

Who gets priority of title in a race jurisdiction?

Answer 105

Whoever records first; notice is irrelevant

Question 106

Who gets priority under a notice statute?

Answer 106

A subsequent BFP (no notice and pays valuable consideration) prevails over a prior grantee who failed to record.

Question 107

Who get priority under a race-notice jdx?

Answer 107

A subsequent BFP (no notice and pays valuable consideration) is protected only if she records before the prior grantee.

Question 108

What counts as notice?

Answer 108

1. Actual notice: knowledge of the prior interest in the real proeprty
2. record notice: recorded in county records
3. inquiry notice: visible/apparent so should have asked

Question 109

What is the BFP Shelter Rule?

Answer 109

If a BFP is protected, then a subsequent purchaser from the BFP is also protected even if the subsequent purchaser knew of the prior unrecorded interest.

Question 110

What is title insurance?

Answer 110

a contract indemnity between the issuing company (the insurer) and the property owner or mortgagee (the insured)

Question 111

What does title insurance generally cover?

Answer 111

(a) exceptions for specific actual or potential defects and (b) standard exclusions, such as:
(i) problems created by the insured party; (ii) defects not shown by public records, but known to the insured part; and (iii) the impact of any law, ordinance, or regulation relating to the use or occupancy of the land.

Question 112

What is a wild deed?

Answer 112

a prior conveyance from a grantor who is outside the recorded chain of title, does not give record notice to subsequent purchasers (e.g. O Grants to A, A does not record but then later conveys to B who records, O then conveys to C. C is not charged with record notice of A-B

Question 113

What is a promissory note?

Answer 113

a contract that establishes personal liability for a loan. Contains amount, terms, timeline and sometimes prepayment clause (permitted if mortgage allows, often with penalty); acceleration clause, due on sale clause

Question 114

What is a mortgage?

Answer 114

a recordable interest to provide record (constructive) notice
- recorded mortgage means security interest will bind susbequent purchasers after foreclosure
- complying with recording statute protects mortgagee (lender) from prior unrecorded interests
- if not recorded subsequent bona fide lender may take priority

Question 115

What is lien theory?

Answer 115

Lender obtains a “lien” on the property: right to sell (to foreclose) the property if borrower fails to repay

Question 116

What is title theory?

Answer 116

lender obtins title to the property until borrower pays off debt
- borrower treated as owner
- JT: mortgage of separate interest court sever

Question 117

What is a mortgage with power of sale?

Answer 117

Mortgage authorizes lender to sell the property at auction and distribute the proceeds

Question 118

What is a deed of trust?

Answer 118

Like a mortgage with per of sale but the borrower “trustor” grants property interest in “trustee (often bank official), not lender. the lender is the trust’s beneficiary (comparable to mortgagee); if borrower defaults, the lender (bank) tells trustee to foreclose.

Question 119

What happens when a mortgaged property is sold but the loan stays in place because it is not paid off?

Answer 119

Default rule: if deed is silent, a new Buyer is not personally liable but still faces risk of foreclosure (unless protected by the recording statute)

Question 120

If a property is purchased subject to the loan, is the new buyer liable for the mortgage?

Answer 120

No, they are not personally liable but still face the risk of foreclosure.

Question 121

If a property is purchased assuming the loan, is the new buyer liable for the mortgage?

Answer 121

Yes, they are personally liable and risk foreclosure.

Question 122

What is surety?

Answer 122

the original buyer remains personally liable for the loan based on the original promissory note, unless they are released from the obligation by the mortgagee

Question 123

What happens when a mortgagor defaults on their loan?

Answer 123

Before the lender “accelerates the loan, the borrower can reinstate (make all late payments); but if the lender has accelerated, the borrower has “equity of redemption” which means they have the right to redeem by paying full amount due

Question 124

What is a deed in lieu of foreclosure?

Answer 124

If borrower and lender agree, a borrower in default can give the lender the deed to avoid the hit on their credit. this is uncommon because the bank takes title subject to all liens/interest on th property

Question 125

What is a judicial foreclosure?

Answer 125

1. the lender files complaint against the necessary parties (borrower, junior lienholders and all other junior interests such as servitude holders)
2. borrower, junior lh, and junior interests can file answer
3. possible claims: no mortgage, no default, defense to mortgage formation;
4. if not contested, lender obtains judgment by default

Question 126

What is the process for a judicial foreclosure?

Answer 126

1. authorizaton by judge,
2. notice of public sale
3. public auction

Question 127

What if the mortgage contains a “power of sale” foreclosure provision

Answer 127

1. most states require advanced notice to borrower of foreclsoure;
2. notice to all junoior interest holders
3. public notice of slae
4. public sale conducted by lender or trustee
5. No direct judicial role

Question 128

What happens to interests in the land after foreclosure?

Answer 128

1. Senior interests are still attached to the property (e.g. senior lien and easements);
2. Junio interests are eliminated (e.g. junior lien and lease)
3. The foreclosing lender’s lien is eliminated

Question 129

How are the proceeds of the sale distributed after a foreclousre?

Answer 129

Assuming no special priority-changin rules: 1. foreclosure lienholder, 2. junior lieholders, 3. Borrower, 4. senior lienholders do not get anything, but their liens remain on the property

Question 130

Who can the lender pursue for deficiency?

Answer 130

if foreclosing lender and other lienholders don’t get amount owed from foreclosure sale (and borrower/debtor isn’t paying), the lienholder’s options are:
1. Junior lienholder: sue borrower on the promissory note
2. Senior lien holder: if lien still attached to the property, foreclose on the bidder who holds title to the property after foreclosure sale.

Question 131

What should you consider when analyzing priorities?

Answer 131

1. Basic rules;
2. Special rules if they could change priority

Question 132

What are the special mortgage priority rules?

Answer 132

1. Junior interest did not get notice of foreclosure
2. Senior interest was not recorded
3. Purchase Money Mortgage (PMM) Priority
4. Deed in lieu of foreclosure

Question 133

What happens if a junior interest does not get notice of foreclosure?

Answer 133

the junior interest is not wiped out by the foreclosure sale

Question 134

what happens if a senior interest is not recorded?

Answer 134

junior mortgagees who are bona fide encumbrancers have priority over earlier unrecorded itnerests who failed to record under applicable recording statute

Question 135

What happens to a PMM in foreclosure?

Answer 135

they have priority over more senior liens, even if the PMM lender had notice

Question 136

What happens to a Deed in lieu of foreclosure at foreclosure?

Answer 136

the lender takes subject to junior liens

Question 137

When applying the special rules of priority, whats the order of operation?

Answer 137

1. Impact of recording statutes on priority of lenders;
2. interests
3. distribution
4. Deficiency

Question 138

What is zoning?

Answer 138

the division if a jurisdiction into districts in which certain uses and developments are permitted or prohibited

Question 139

Is zoning public or private law?

Answer 139

Public (done by the gov.)

Question 140

Who can enforce zoning?

Answer 140

Local government officials. In contrast, covenants can be enforced by private property owners at law or equity

Question 141

Are there exceptions to zoning if you already had a prohibited use?

Answer 141

Yes, nonconforming use

Question 142

What is nonconforming use?

Answer 142

a use of land that lawfully existed before the zoning ordinance was enacted but that does not comply with ordinance; expansion is usually prohibited; cannot be transformed to other nonconforming use; minor repairs are permitted but major repairs that will extend the duration of the use are not permitted.

Question 143

How are nonconforming uses terminated?

Answer 143

(a) abandonment; or (b) destruction

Question 144

How does abandonment occur in nonconforming use?

Answer 144

(1) the owner intends to abandon the use, and (2) the use is discontinued for a substantial period

Question 145

How does destruction of nonconforming use occur?

Answer 145

destruction of a structure containing nonconforming use terminates the right to continue use, even if accidental

Question 146

Are there exceptions to zoning if i have a hardship?

Answer 146

Yes, variance may be permitted.

Question 147

What is variance?

Answer 147

a permitted deviation from strict enforcement of a zoning ordinance in an individual case due to special hardship. It permits a particular parcel of land to be sued in a way that would otherwise violate the zoning ordinance. e.g. area variance and use variance.

Question 148

What is an area variance?

Answer 148

allows modification of height, location, setback, size, or similar requirements for a use that is permitted in the zone

Question 149

What is use variance?

Answer 149

Allows a use that would normally be prohibited in the zone. Like nonconforming except asking for permission.

Question 150

What is the standard for granting variance?

Answer 150

(1) owner’s hardship such as not being able to put their land to use because of the zoning, some unique issue with the property; and (2) the impact on the neighborhood or zoning district, such that it will not alter the essential character of the area.

Question 151

When will a variance not be granted?

Answer 151

1. owner created hardship
2. hardship is personal and not based on property use

Question 152

What is a covenant?

Answer 152

an agreement among owners that a parcel or multiple parcels of land will be used in a certain way.
- Real Covenants (Remedy: Damages)
- Equitable Servitudes (Remedy: Injunction

Question 153

What is a real covenant?

Answer 153

A promise concerning the use of land that benefits and burdens both the original parties to the promise and their successors.

Question 154

What is needed for the burden to run between successors?

Answer 154

Mnemonic: SITNHV
1. SoF
2. Intent to bind successors
3. Touch and concern the land
4. Notice
5. Horizontal privity
6. Vertical Privity?

Question 155

What is needed for the benefit to run between successors?

Answer 155

Mnemonic: SITV
1. SoF
2. Intent to bind successors
3. Touch and concern the land
4. Vertical Privity

Question 156

What does it mean for it to touch and concern the land?

Answer 156

It must relate to the enjoyment, occupation, or use of the land

Question 157

How is notice satisfied?

Answer 157

Promisor’s successor must have notice by ARI

Question 158

How is horizontal privity met?

Answer 158

original parties to the covenant to have shared some interest in the land independent of the covenant (e.g. landlor-tenant, cotenant, owner of dominant land and servient tract of an easement, grantor-grantee, and mortgagor-mortgagee)

Question 159

How is vertical privity met on the burden side?

Answer 159

For the burden to run, vertical privity requires, the successor to the land receive the entire estate held by the original promisor

Question 160

How is the burden met on the benefit side?

Answer 160

For the benefit to run, Vertical privity requires, the successor the land receive either the entire estate or a smaller estate held by the original promisor (e.g. life-estate for the original owner)

Question 161

What is an equitable servitdude?

Answer 161

A promise that, regardless of whether it runs with the land at law, equity will enforce against the successors of the burdened land unless the successor is a BFP.

Question 162

What are the requirements for the burden of an equitable servitude to run?

Answer 162

Mnemonic ScITN
1. SoF, or common plan
2. Intent to Bind Successors
3. Touch and concern the land
4. Notice

Question 163

What are the requirements for the benefit of an equitable servitude to run?

Answer 163

1. SoF or common plan

Question 165

How is a common plan satisfied?

Answer 165

1. will be implied where a developer imposed uniform restriction on a subdivision in which all lots are burdened and benefited by the restrictions even if they do not appear in the chain of title to every lot (e.g., limit to residential use based on sales literature, statements by developer, and percent of deeds and restrictions)