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Real Property--Created Cards > Estates and Interests > Flashcards

Estates and Interests Flashcards

1
Q

Types of Defeasible Estates (and future interests created)

A

-Fee Simple Determinable (possibility of reverter)
-Fee Simple Subject to Condition Subsequent (default) (right of re–entry)
-Fee Simple Subject to Executory Limitation (executory interest)

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2
Q

CL Fee Simple Absolute vs. Modern

A

Common Law–needed to say “To A and his heirs”
Modern–default, “to A” enough
Grants all rights one can have in land, forever
Can’t really destroy–closest if if die w/out will or heirs, escheats to the state

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3
Q

Devisee

A

Person who takes by will

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4
Q

Heir

A

Person who takes by law of intestacy (also used colloquially)

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5
Q

Grantee

A

Person who takes by inter vivos (“b/tween the living”) transfer

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6
Q

Defeasible

A

Estate that can end before its maximum duration before max duration occurs (ex. life estate–before end of life; FSA; not forever)

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7
Q

Future Interests created w/ life estate, term of years

A

Not to third party = interest in reversion (NOT reverter) to grantor + heirs
-NOT subject to RAP, b/cause vests at execution of instrument (like all future interests in grantor)
-Devisable, descendible transferable

To third party–future executory interest
Subject to RAP

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8
Q

Fee Simple Determinable (FSD)

A

“To A as long as she lives in the state”

Can ONLY have if “magic words”: “as long as/for so long as,” “during” “until” “while”–durational

Automatically terminates if event happens, returns to grantor/heirs

Possibility of reverter in grantor + heirs

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9
Q

Default/Preferred Defeasible Estate

A

Fee Simple Subject to Condition Subsequent (but often courts just interpret ambiguous as FSA rather than FSSC–really like FSA)

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10
Q

Future interest created w/ Fee Simple Determinable

A

Possibility of reverter in grantor + heirs

NOT SUBJECT to RAP–vested when instrument executed

Freely transferable, devisable, AND descendible

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11
Q

Magic words for FSD

A

Fee Simple Determinable–durational language
-“As long as/for so long as”
-“Until”
-“While”
-“During use as”

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12
Q

Language for FSSCS

A

Fee Simple Subject to Condition Subsequent–
conditional language
Ex. -unless, provided, however
,on condition that, in the event that
AND
Generally need to express reserve a power of termination in grantor [“then A can retake,” etc.]
W/out–court may say is just a FSD

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13
Q

Fee Simple Subject to Condition Subsequent

A

“From A to Y, unless Y gets a cat, then A has the power to terminate Y’s estate.”

Generally need conditional language (unless, on the condition that, etc.) AND expressly reserved power of termination in grantor/heirs

Right of reentry in grantor/heirs if condition met–but not auto, must enter/use** to activate** (condition meet alone = still belongs to grantee–need condition + action to reclaim)

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14
Q

Future Interest Created w/ Fee Simple Subject to Condition Subsequent

A

Right of Reentry/Power of Termination
In grantor/heirs, but not auto upon breaking, MUST activate to take effect–take affirmative steps

NOT SUBJECT to RAP–vests at time document executed (like all future interests in grantor)

Devisable and descendible, but NOT transferable intra vivos

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15
Q

Failure of creation of future interest

A

If don’t use right words–can just be FSA
Becomes covenant—Can still sue on damages/breach of covenant–but don’t get land

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16
Q

Executory Interest

A

Always what is created when create interest letting third person cut short previous estate before ends (vs. remainder–natural end)

Cut short + Third person getting= executory

Fee simple subject to executory limitation, life estate subject to executory limitation, etc.

Auto termination upon happening of event
Subject to RAP

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17
Q

Future Interest created w/ FSSEL

A

Executory interest (automatic)
Can be shifting (auto to 3rd party) or springing (auto back to grantor for X time, then to 3d party)
Subject to RAP

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18
Q

Unclear Grants of Land

A

General Principles if ambiguous:
-FSA preferred, forfeiture avoided
1) Covenant preferred over defeasible estate (b/cause award is damages vs. forfeiture)
2) FSSCS preferred over FSD (because forfeiture not auto)

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19
Q

Freehold Estates vs. Non-Freehold

A

Non-freehold–limited in duration, basically landlord/tenant (term of years–“for 50 years” “for 1 month”)

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20
Q

Life Estate

A

Lasts for duration of grantee’s life

Default: after grantee dies, returns to grantor + G’s heirs

G + heirs have interest in reversion–life estate does actually have some duties to them

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21
Q

Life Estate Per Autre Vie

A

Life estate measured by someone else’s life (ex. “From X to Y, for the life of C”)

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22
Q

Life Estate Duty re: Repair

A

Duty to maintain property in reasonable state of repair (ordinary wear and tear N/A)
Limit–only extent of income derived from or (if living on) r. rental value of land
Can be liable to people who will hold for waste

23
Q

Tenant for Years/Periodic Tenant Duty re: Repair

A

Duty to maintain property in reasonable state of repair (ordinary wear and tear N/A)
Not limited by income derived or r. rental value (but now most states have statutes)

24
Q

Life Estate Duty re: Mortgages

A

Have to pay interest to extent of profits derived from property

25
Q

Tenant for Years/Periodic Tenant Duty re: Mortgages

A

No CL duty to pay

26
Q

Life Estate Duty re: Taxes

A

Pay all ordinary taxes, to extent of profits derived from prop.

27
Q

Tenant For Years/Periodic Duty re: Taxes

A

No duty, UNLESS

1) Lease “perpetual” or long-term w/ option for tenant and successors to renew “forever” OR
2) Tenant holds w/out any duty to pay rent OR
3) Tenant has put improvements on premises for his own benefit

28
Q

Reversionary Interest

A

Created in grantor when grantor transfers less than a fee interest to a person (ex. life estate, term of years)

Can be silent, temporary (ex. “To Y for life, then to Grantor for 1 year, then to Z–silent reversionary interest in G)

Transferable, devisable, descendible

NEVER SUBJECT to RAP

29
Q

Remainder

A

A future interest created in third person intended to happen after natural termination (i.e. not conditional) of preceding estate
(Ex. “To B for life, then to C”)
Subject to RAP

30
Q

Vested Remainder

A

Remainder vests when:

1) Ascertainable person
AND
2) Not subject to any condition precedent, except termination of preceding estate

31
Q

Contingent Remainder

A

Key Q–do we know who this person is?

Remainder that has not vested, b/cause either
1) NOT ascertainable person(s) to ID OR
2) Subject to condition precedent that hasn’t occurred (ex. “to X, then to X’s oldest child living”–until X die, don’t know who will be oldest child alive)

32
Q

Things to look out for re RAP, contingent remainders

A

Children–generally assume people can have children even if old (“fertile octogenarian”)
Just because has children now, doesn’t mean all will survive, all have been born–tricky if “oldest child living,” “all grandchildren”

33
Q

Vested Remainder Subject to Total Divestment

A

Vested, but can terminate if x event happens

Ex. FSSCS, FSSE

“To B, unless she buys a ferret”

34
Q

Vested Remainder Subject to Open

A

Remainder made to class where there is at least one member whose rights have vested (i.e. is: 1) ascertainable; and 2) not subject to conditions precedent beyond end of prior estate), but the class may have other members join in the future

Ex. “then to the children of C”–even if C already has kids, might be more
“to the children of C who reach 21”–not only might there be more kids, but some might not meet the condition precedent

35
Q

Open Class

A

Class of people with remainder, but who haven’t all been determined yet either b/cause don’t meet condition yet or don’t exist (ex. “the children of X,” “the children of x who are over 16”)

36
Q

Class Opening for Remainder Interest

A

Inter vivos transfer = opens at time of conveyance (write + convey “to children of C = if one child dies a day later, goes to child’s heirs)

Testamentary transfer = opens at time of death of testator (NOT when written, NOT when clears probate) (X writes + conveys to kids of C in will, one child dies a day before X–child’s heirs out of luck)

37
Q

Closing of Class

A

-If RAP violated by class–voids future interest
-Can save via rule of convenience
-Class closes = afterborn children cannot join

38
Q

RAP + Open Classes

A

CL– if any member of class could potentially claim in way that violates RAP = entire class gift invalid

Modern–Rule of convenience–class closes to afterborn children once one member entitled to immediate possession
-“Too bad rule”

39
Q

Rule of Convenience

A

Way to save class that might violate RAP–“too bad rule”

-Once one member of class meets conditions + entitled to immediate possession class closes–afterborn children cannot join

Ex: B for life then children of C who are 25–C has X + Y + Z before B’s death, X turns 25, B dies, C has child W–class closed since X met conditions–Y + Z will share once hit 25, W out of luck)

40
Q

Types of Executory Interests

A

1) Shifting = immediate transfer from prior person–> third person (grantee–> grantee)
(Ex. “To X, unless X gets ferret, then to Y”)
2) Springing executory interest = pause between when goes to 3rd person–goes back to grantor + 3rd person cuts grantor off (**grantee A->grantor–>grantee B)
(Ex. “To X for life, then to grantor for 2 years, then to Y”–grantor had 2 year reversion in fee)

41
Q

Persons subject to waste rules

A

Fee = can do anything (even if possibile fee could be cut short in future, ex. FSSCS, FSSEL)

Less than fee = cannot commit waste (ex. life, term of years, etc.)

42
Q

Waste

A

Harming property at expense of person who will (not might) hold after them

Only applies re: non-fee interests (ex. life estate, tenant, mortgagor/mortgagee)

3 types: voluntary, permissive, ameliorative

43
Q

Voluntary Waste

A

Intentionally or negligently damage property–liable

44
Q

Permissive Waste

A

Fail to take reasonable steps to avoid damage (ex. know in hurricane area, don’t get hurricane-proof doors)–liable

45
Q

Ameliorative waste

A

Make improvements to land

CL = can’t do w/out permission, may have to pay to restore

Modern = can’t UNLESS
1) Market value of remainderman interest not impaired AND
2) Permitted by remainderman OR
3) Sub and permanent change in neighborhood justifies

46
Q

Waste exception

A

Only re: ameliorative waste, only if modern rule applies
OK if
1) Market value of remainderman interest not impaired
AND
2) **Permitted **by remainderman OR
3) Sub. and permanent change in neighborhood justifies–basically, can’t enjoy property anymore

47
Q

RAP applies to

A

1) Executory Interests
2) Contingent Remainder
3) Vested Remainder Subject to Open
4) Purchase Option
5) Right of First Refusal

48
Q

Rule Against Perpetuities

A

“No interest is good unless it must vest, if at all, not later than 21 years after some life in being at the creation of the interest.”

Key q–is there any scenario where someone could claim over 21 years after everyone now alive + connected to deed dead?

If clause violates RAP–knock out

49
Q

Total Restraint on Alienation

A

Completely prevents transfer of property–“if B ever tries to sell her interest then to C”

Fee estate–usually invalid
Less than fee–OK if reasonable

50
Q

Partial Restraint on Alienation

A

-Purchase Option
-Right of First Refusal
Valid if reasonable: Consider:
1) limited in scope and time? (subject to RAP)
2) Purpose of restraint?
3) Interests of parties?
4) Supported by consideration?

51
Q

Purchase Option

A

Reservation of right to buy–ex. “A to B and heirs, but reserve right to buy back during my lifetime”
-Subject to RAP

52
Q

Right of First Refusal

A

Partial restraint on alienation–gives right to match legit offer (“if sell, must first offer to X at same price”)
Subject to RAP

53
Q

Restraints on Alienation re: inheritable future interests

A

Void where restraint may continue in effect after the future interest becomes possessory

Simpler way to phrase: if future interest will result in fee simple, restraint void from start as against public policy

Real Property--Created Cards (7 decks)

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