Estates in Land

Question 1

Fee Simple Absolute

Answer 1

1. “To A” or “To A and his heirs” (his heirs not needed)
2. Absolute ownership of potentially infinite duration. It is freely devisable(will), descendable(intestacy,w/o will), and alienable (inter vivos transfer).
3. Future Interest:

• _​_While owner (A) is alive only A has absolute ownership and has prospective heirs.

Question 2

The Fee Tail

Answer 2

1. “To A and the heirs of his body.”
2. Virtually abolished in the U.S. today. Today, the attempted creation of a fee tail creates instead Fee Simple.

Question 3

Fee Simple Determinable-FSDPOR

Answer 3

1. “To A for so long as . . .” “To A during . . .” “To A until . . .”

• Grantor must use conditional language
• If condition violated forfeiture is automatic

2. This estate, like all of the defeasible fees, is devisable, descendible and alienable, but always subject to the condition.
   * You may convey less than what you started with, but you can’t convey more.
3. Future interest is the possibility of reverter in the grantor. FSDPOR

Question 4

Fee Simple Subject to Condition Subsequent

Answer 4

1. “To A, but if X event occurs, grantor reserves the right to re-enter and retake.”

• grantor must use clear durational language and
• explicit carving out of right to re-entry if condition occurs

2. This estate is NOT automatically ended, but it can be cut short at the grantor’s option, if the stated condition occurs.
3. Future interest the right of entry, synomous with the power of termination.

Question 5

Fee Simple Subject to Executory Limitation

Answer 5

1. “To A, but if X event occurs, then to B.”
2. This estate is just like the fee simple determinable only now, if the condition is broken, the estate is automatically forfeited in favor of someone other than grantee.
3. Future Interest is Shifting Executory Interest.

Question 6

DEFEASIBLE FEES, NOTE TWO IMPORTANT RULES OF CONSTRUCTION:

Answer 6

1) Words of mere desire, hope, or intention are insufficient to create a defeasible fee.

• courts disfavor restrictions on free use of land
• Court will not find defeasible fee UNLESS clear durational language is used

2) Absolute restraints on alienation are void.
* An absolute restraint on alienation is an absolute ban on the power to sell or transger that is not linked to a reasonable time limited purpose

Question 7

The Life Estate

Answer 7

1. O conveys: “To A for life.”

• This is an estate that must be measured in explicit lifetime terms and NEVER in term of years.
• The life estate pur autre vie: “To A for the life of B.”
  
  • A life estate measured by a life other than the grantee.

2. Life Tenant’s entitlements are rooted in the important doctrine of waste

• Life tenant is entitled to: all ordinary use and profits from the land
• Life tenant must not commit waste: must not do anything to hurt future interest of holders

3. Future Interest: If held by the O, the grantor, it is called a reversion. If held by a third party, it is a remainder.

Question 8

Life Estates and Voluntary Waste

Answer 8

• Voluntary or affirmative waste. This is overt conduct that causes a drop in value (willful destruction)
  
  1. Voluntary Waste and Natural Resouces: The life tenant must not consume or exploit natural resources on the property (such as timber, oil, or minerals), unless one of four exceptions applies, remembered by PURGE.
     
     1. PU: Prior Use, meaning that the prior to the grant, the land was used for exploitation
     2. R: Repairs. Life tenant may consume natural resources for repairs and maitenance
     3. G: Granted. Life tenant may exploit if granted that right.
     4. E. Exploit, meaning the land is only suitable for exploiting. i.e. if its a quarry.

Question 9

Life Estates-Permissive and Ameliorative Waste

Answer 9

• Permissive waste, or neglect. This occurs when: the land is allowed to fall into disrepair

1. Permissive waste and the obligation to repair: Life tenant must simply maintain the land and structures in reasonable good repair
2. Permissive waste and the obligation to pay all ordinary taxes: The life tenant is obligated to pay all ordinary taxes on the land, to the extent of income or profits from the land. If there is no income or profit, the life tenant is required to pay all ordinary taxes to the extent of land’s fair rental value.
3. Must pay Mortgage interest

• Ameliorative waste: The life tenant must not engage in acts that will enhance the property’s value, unless: all the future interest owners are known and consent

Question 10

Future Interests Capable of Creation in the Grantor

Answer 10

1. The Possibility of Reverter: It accompanies only the fee simple determinable
2. The Right of Entry, also known as the Power of Termination: It accompanies only the fee simple subject to condition subsequent.
3. The Reversion: Catch-all default answer.

• A reversion is the future interest that arises in a grantor who transfers an estate of lesser quantum than she started with, other than a fee simple determinable or a fee simple subject to condition subsequent.

Question 11

Future Interests in Transferees

Answer 11

If our future interest is held by someone other than the grantor, it has to be either:

1. A vested remainder (of which there are three species: (i) the indefeasibly vested remainder, (ii) the vested remainder subject to complete defeasance (also known as the vested remainder subject to total divestment), and (iii) the vested remainder subject to open).
2. A contingent remainder; OR
3. An executory interest (of which there are two species: (i) t_he shifting executory interest_, and (ii) the springing executory interest).

Question 12

THREE TASKS IN ASSESSING FUTURE INTERESTS IN TRANSFEREES:

Answer 12

1. We must distinguish vested remainders (of which there are three kinds), from contingent remainders;
2. We must distinguish the three kinds of vested remainders from each other; and
3. We must distinguish all remainders from executory interests.

Question 13

What is a Remainder?

Answer 13

A remainder is a future interest created in a grantee that is capable of becoming possessory upon the expiration of a prior possessory estate created in the same conveyance in which the remainder is created.

• always accompanies a preceding estate of known titled duration. Usually estate is life estate or term years.
  
  • “To A for life, then to B,” or “To A for ten years, then to B.” B Remainderman
• ​​​Remainderman never follows a defeasible fee.

Question 14

REMAINDERS ARE EITHER VESTED OR CONTINGENT.

Answer 14

• A remainder is vested if it is both created in an ascertained person and is not subject to any condition precedent.
• A remainder is contingent if it is created in an unascertained person OR is subject to a condition precedent, or both.

1. The remainder that is contingent because it is created in as yet unborn or unascertained persons.
   
   1. “To A for life, then to B’s heirs.”
   2. “To A for life, then to those children of B who survive A.”
2. The remainder that is contingent because it is subject to a condition precedent.
   
   1. A condition is a condition precedent when it appears BEFORE the language creating the remainder or is woven into the grant to remainderman.
      
      1. “To A for life, then, if B graduates from college, to B.”

Question 15

Contingent remainders and:

1. The Rule of Destructibility
2. The Rule in Shelley’s Case
3. The Doctrine of Worthier Title

Answer 15

• The Rule of Destructibility of Contingent Remainders:ABOLISHED
  
  1. At common law, a contingent remainder was destroyed if it was still contingent at the time a preceding estate ended.
     
     1. “To A for life, and if B has reached the age of 21, to B.” But A dies before B reaches 21.
  2. Today: The Destructibility Rule has been AOLISHED when B is still under 21 when A dies, O and O’s heirs hold the estate subject to B’s springing executory interest. Once B reaches 21, B takes.
• The Rule in Shelley’s Case: At common law, the rule would apply in one setting only:
  
  1. O conveys “To A for life, then, on A’s death, to A’s heirs.” A is alive.
  2. Historically: The present and future interests merged giving A a Fee Simple.
  3. RULE OF LAW not Rule of Construction. Applied even in the face of contrary grantor intent.
• The Doctrine of Worthier Title (also known as the rule against a remainder in grantor’s heirs):
  
  1. This doctrine is still viable in most states today. It applies when O, who is alive, tries to create a future interest in his heirs.
     
     1. O, who is alive, conveys “To A for life, then to O’s heirs.”
  2. Because of the Doctrine of Worthier Title, the contingent remainder in O’s heirs is VOID. Thus, A has a life estate and O has a reversion.
  3. Rule of Construction and not rule of law. Grantors intent controls.

Question 16

Distinguish the three kinds of vested remainders AND CLass

Answer 16

• The indefeasibly vested remainder: The holder of this remainder is certain to acquire an estate in the future, with no strings attached
  
  • “To A for life, remainder to B.” A is alive. B is alive.
  • If B dies before A, at common law B’s future interest passes by will or intestacy.
• The vested remainder subject to complete defeasance (also known as the vested remainder subject to total divestment).
  
  • Remainderman exists. His taking NOT subject to any condition precedent. However, his right to possession could be cut short because of a condition subsequent.
  • O conveys: “To A for life, remainder to B, provided, however, that if B dies under the age of 25, to C.” A is alive. B is 20 years old.
• The vested remainder subject to open:
  
  • A remainder is vested in a group of takers, at least one of whom is: qualified to take.
  • But each class member’s share is subject to partial diminution because: additional members can still join in.
• (i) a class is open if others can still join; (ii) class is closed when no others can join
  
  • Class closes when any member can demand possession (rule of convenience)
  • Womb Rule Exception

Question 17

Distinguish remainders from executory interests:

Answer 17

• What is an executory interest? It is a future interest created in a transferee (a third party), which is not a remainder and which takes effect by either cutting short some interest in another person (“shifting”) or in the grantor or his heirs (“springing”).
• Shifting executory interest:
  
  • Always follows the defeasible fee and cuts short someone other than the grantor
  • “To A and her heirs, but if B returns from Canada sometime next year, to B and his heirs.” (does not violate RAP)
• Springing executory interest:
  
  • cuts short the grantor
  • O conveys: “To A, if and when he becomes a lawyer.” A is in high school.

Question 18

THE RULE AGAINST PERPETUITIES (“RAP”)

PA DISTINCTION

Answer 18

The Rule: Certain kinds of future interests are void if there is any possibility, however remote, that the given interest may vest more than 21 years after the death of a measuring life.

PA DISTINCTION: No interests created after 12/31/2006 will be voided using RAP

Question 19

Four-Step Technique for Assessing Potential RAP Problems:

Answer 19

1. Determine which future interests have been created by the conveyance. The RAP potentially applies only to contingent remainders, executory interests, and certain vested remainders subject to open. The RAP does NOT apply to: (i) any future interest in O the grantor; (ii) indefeasibly vested remainders; or to (iii) vested remainders subject to complete defeasance
2. Identify the conditions precedent to the vesting of the suspect future interest.
3. Find a measuring life. Look for a person alive at the date of the conveyance and ask whether that person’s life or death is relevant to the condition’s occurrence.
4. Ask: Will we know, with certainty, within 21 years of the death of our measuring life, if our future interest holder(s) can or cannot take? If so, the conveyance is good. If not (if there is any possibility, however remote, that the condition precedent could or could not occur more than 21 years after the death of a measuring life), the future interest is void.

Question 20

Two Bright Line Rules of Common Law RAP

Answer 20

1. A gift to an open class that is conditioned on the members surviving to an age beyond 21 violates the common law RAP.
   
   • “Bad as to one, bad as to all.” To be valid, it must be shown that the condition precedent to every class member’s taking will occur within the perpetuities period. If it is possible that a disposition might vest too remotely with respect to any member of the class, the entire class gift is void.
2. Many shifting executory interests violate the RAP. An executory interest with no limit on the time within which it must vest violates the RAP and is stricken.
3. The charity-to-charity exception:

• A gift from one charity to another: does not violate the RAP.

Question 21

Reform of the RAP:

Answer 21

1. The “wait and see” or “second look” doctrine: Under this majority reform effort, the validity of any suspect future interest is determined on the basis of the facts as they now exist
   
   • This eliminates the “What if” or “anything is possible” line of inquiry.
2. The Uniform Statutory Rule Against Perpetuities (USRAP):
   
   • Codifies the common law RAP and, in addition, provides for: an alternate 90 year vesting period
3. Both the “wait and see” and USRAP reforms embrace:
   
   1. ​The cy pres doctrine: “as neas a possible”
      
      • If a given disposition violates the rule, a court may reform it in a way that most closely matches the grantor’s intent while still compliyng the the RAP
   2. The reduction of any offensive age contingency to 21 years.

Question 22

Three Forms of Concurrent Ownership

Answer 22

1. Joint Tenancy: two or more own with the right of survivorship
2. Tenancy by the Entirety: a marital interest between married partners with the right of survivorship
3. Tenancy in Common: two or more own without the right of survivorship

Question 23

The Joint Tenancy: Characteristics and Creation-T-TIP

Answer 23

1. Disntiguishing Chacteristics:
   
   1. The right of survivorship. When one owner dies his share goes to surviving owners
   2. Join Tenant’s interest is alienable. NOT devisable or descendable.
2. Creation of Joint Tenancy
   
   1. ​The Four Unities: “T-TIP” Joint tenants must take theirs interests:
      
      1. T: Same Time
      2. T: Same Title/Instrument
      3. I: Identical Shares and
      4. P: Posses the Whole
   2. Grantor must clearly express the right of survivorship
   3. Use of a Straw. To satisfy Four Unities Must convey to Straw then Straw conveys back Owners thus satisfying T-TIP.

Question 24

Joint Tenancy-Severance and Sale-SPAM

Answer 24

• Severance of a Joint Tenancy: Remember “SPAM”: Sale, Partition and Mortgage

1. ​A joint tenant can sell or transfer her interest during her lifetime.
   
   • _​​_May sell or transfer secretly and without consent of Joint Tenant
   • One joint tenant’s sale severs the joint tenancy as to seller’s intereest: disrupts four unities
   • Buyer becomes tenant in Common HOWEVER if three or more tenants the Joint Tenancy remains in tact as to TWO non-sellers.
2. In equity, a joint tenant’s mere act of entering into a contract for the sale of her share will: sever the joint tenancy as to contract parties interest
   
   • ​​This is because of the doctrine of: equitable conversion which provides that “equity regards as done that which ought to be done”

Question 25

Joint Tenancy-Severance, Partition, Mortgage

PA DISTINCTION

Answer 25

• Severance and Partition: Remember three variations
  
  1. By Voluntary Agreement: a peaceful way to end agreement
  2. Partition in Kind: court action for physical division of property in best interest of all parties. WORKS BEST FOR LAND.
  3. Forced Sale: court action in in best interests of all where land sold and proceeds divided up proportionally
• Severance and Mortgage:
  
  1. Title Theory (Minority Rule): One joint tenant’s execution of a mortgage or a lien on his or her share will sever the joint tenancy as to that now encumbered share
  2. Lien Theory (Majority Rule): a joint tenant’s execution of a mortgage on his or her interest will not sever the joint tenancy
• PA DISTINCTION: Intermediary theory: mortgage by all Lien, <all></all>

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Question 26

The Tenancy by the Entirety

Answer 26

1. Created between MARRIED partners with the right to survivorship.
   
   • In those states to recognize the tenancy by the entirety, it arises presumptively: in any grant to married partners UNLESS grant says otherwise
2. Strongly Protected form of co-ownership
   
   1. ​Creditors: of only one spouse can’t touch a tenancy in entirety
   2. Unilateral Conveyance: Neither tenant, acting alone, can defeat the right of survivorship by: a unilateral transfer to a third party.

Question 27

Tenancy in Common

Answer 27

1. Each co-tenant owns: an individual part, and each has a right: to posses the whole
2. Each interest is devisable, descendable, and alienable. There are no survivor rights between tenants in commmon.
3. The Presumption favors: Tenants in Common.

Question 28

Tenancy in Common-Rights and Duties of Co-Tenants (1-5)

Answer 28

1. Possession: Each co-tenant is entitled to posses the whole
   
   • If one co-tenant wrongfully excludes another co-tenant from possession of the whole or any part, he has committed wrongful ouster
2. Rent from co-tenant in exclusive possession: absent OUSTER, a co-tenant in exclusive possession is not liable to other co-tenants for rent​
3. Rent from third parties: A co-tenant who leases all or part of the premises to a third party: must account to his co-tenants, providing them their fair share of the rental income.
4. Adverse Possession: Unless he has ousted the other co-tenants, one co-tenant in exclusive possession for the statutory adverse possession period: CANNOT acquire title to exclusion of others.
   
   • HOSTILITY element missing
5. Carrying costs: Each co-tenant is responsible for his or her fair share of carrying costs (such as taxes and mortgage interest), based upon his/her undivided share

Question 29

Tenants in Common-Rights and Duties of Co-Tenants (6-9)

Answer 29

1. Repairs: The repairing co-tenant enjoys: a right to contribution for reasonable repairs provided that she has told other co-tenant of the need.
   
   • Each contribues proportional to undivided share.
2. Improvements: During the life of the co-tenancy, there is NO right to contribution for “improvements”
   
   1. HOWEVER, at partition, the improving co-tenant is entitled to a credit, eqaul to: any increase in value caused by her efforts
   2. Attendantly, at partition, the so called “improver” bears full liability for: any drop in value she caused
3. Waste: A co-tenant must no commit waste (Voluntary, permissive, ameliorative)
4. Partition: A joint tenant or tenant in common has a right to bring an action for partition.