Final Final

Question 1

Tests applied to see if the regulation goes too far

Answer 1

(1) the nuisance theory,
(2) the ad hoc balancing theory in Penn Central,
(3) the Lucas Test where the regulation completely reduces the value of the property to zero (total wipeout)
(4) the Loretto test, where the regulation requires some physical appropriation of the property. (per se takings)

Question 2

What property transfer absolutely destroys vertical privity?

Answer 2

Adverse Possession

Question 3

noxious use (nuisance) exception

Answer 3

applies only when the regulation seeks to regulate something that would be a common-law nuisance regardless of an alleged taking. No recovery granted

Question 4

race-notice jurisdiction

Answer 4

the buyer who records first generally takes title. However, a buyer who is on notice of someone else’s interest in the property does not take title even if he or she records first.

Question 5

Three types of notice

Answer 5

inquiry, actual, constructive

Question 6

Actual notice

Answer 6

where one has knowledge of such facts as would lead any honest person, using ordinary caution, to make further inquiries.

Question 7

covenants conveyed in the general warranty deed

Answer 7

for the defects in title because any contractual obligation she may have had was extinguished by merger at the closing.

Question 8

Adverse possession (easements)

Answer 8

resulting from use of another’s property that is open, notorious, adverse, and continuous for a period of fifteen years. Use need not be exclusive for easements, and, in fact, too much continuous use by the public has been held to create a prescriptive easement unless this use has been interrupted

Question 9

Easements appurtenant can be created by

Answer 9

tacking previous possessors’ usage to that of current possessors, though some form of privity is required.

Question 10

Equitable Conversion Rule

Answer 10

If there is a specifically enforceable contract for the sale of land
the buyers viewed an equity as the owner.
From the date of the contract, the buyer has equitable title and the seller has a claim for money
which is secured by the Land’s value itself.
The seller is said to hold legal title as trustee for the buyer.

Question 11

When does equitable conversion apply?

Answer 11

When bad things happen before closing

Question 12

2 examples of Equitable conversion implementation

Answer 12

Risk of loss - house burns before sale of the house closes

Inheritance - where one of the parties to the purchase agreement dies and the question becomes whether the dissident’s estate has only a right to purchase (personal property) or is the owner of the land (real property).

Question 13

Title is unmarketable if ..

Answer 13

it exposes the buyer to the hazards of litigation

Question 14

Restrictive Covenants (Land Transactions)

Answer 14

the mere existence of a restrictive covenant makes title unmarketable because it is an encumbrance. It may prevent some use the buyer is contemplating.

Question 15

What is the merger doctirne?

Answer 15

When a buyer accepts a deed, the buyer is deemed to be satisfied that all the contractual obligations in the purchase agreement have been met. The purchase agreement is said to merge with the deed. (cant sue based on purchase agreement after merge)

Question 16

What is the equation for Damages for Breach of a Purchase Agreement?

Answer 16

(Contract Price - FMV) + Incidental + Interest = Damages

Question 17

When there is a breach in a land transaction agreement what happens to the earnest money deposit?

Answer 17

keep the deposit. up to 10% down

Question 18

General Warranty Deed

Answer 18

warrants title against all defect in title weather they arose before or after the grantor took title.
[property sold with this deed sells for more than the others – this is the standard for fair market value]

Question 19

Special Warranty Deed

Answer 19

warrant title against the grantors own acts (but not the acts of others who came before the grantor)
[ sells at a 19% discount to general warranty deed property]

Question 20

Things in a Deed - Acknowledgment by a notary Public

Answer 20

General Rule – in most states a deed signed by the grantor and delivered to the buyer is valid without acknowledgement by a notary public.

But to be recorded the deed needs to be acknowledged by a notary public.

Question 21

what if there isn’t a forgery, but there is fraud regarding the deed?

Answer 21

Most courts hold that fraud is voidable against the grantee.

But the grantor bears the loss against a bona fide purchaser for value who in good faith buys from fraudulent grantee.

Question 22

6 covenants in a general warranty deed

Answer 22

(1) a covenant of seisin – The grantor warrants that they own the estate they are trying to convey

(2) a covenant of right to convey – the grantor warrants that he or she has the right to convey the property

(3) the covenant against encumbrances – the grantor warrants that there are no encumbrances on the property that are not disclosed. Theses typically include……

(4) a covenant of generally warranty – the grantor warrants that he or she will defend against lawful claims and will compensate the grantee for any loss that the grantee may have because of someone else’s superior title.

(5) a covenant of quiet enjoyment

(6) a covenant of further assurances – the grantor promises to execute any other documents required to….

Question 23

What is a judicial right of redemption?

Answer 23

This is the right that courts (using their equitable powers) give to borrowers. It allows buyers a reasonable time to pay back any past payments BEFORE the court will order a foreclosure.

Borrowers have a right to redeem up until the court issues a foreclosure. (That’s what foreclosure means. The foreclosure of the borrower’s right to redeem.)

Question 24

What is a statutory right of redemption?

Answer 24

Statutory Right of Redemption: This is a time period AFTER foreclosure that the borrower has to recover the property. (Comes up more on judicial

The borrower must pay all back payments, interest, foreclosure fees, etc.

Question 25

Deed of trust takeaway

Answer 25

used just like a mortgage but there is no need to go through foreclosure proceedings

Question 26

What is a Deficiency Judgment?

Answer 26

The lender’s right to sue you seeking payment for any costs it failed to recover in the foreclosure process. These can be substantial when the loan is underwater

Question 27

What effect does the Marketable Title Act have on the Recording system?

Answer 27

limit title searches to reasonable periods – typically 30 to 40 years.

Question 28

what is a Race-notice jurisdictions?

Answer 28

a subsequent purchaser is protected against prior unrecorded interest only if the subsequent purchaser (1) is without notice of the prior interest and (2) records before the prior interest is recorded.

Question 29

What is a nuisance

Answer 29

n unreasonable or substantial interference with the use or enjoyment of a person’s real property by the actions of a person on a nearby property. Ex. Noise; Dust; Odors; Insects; Rodents

Question 30

Elements of Nuisance

Answer 30

Nuisances arise from (1) substantial, non-trespassory invasion of (2) use and enjoyment of land that is (3) caused by negligent, reckless, or ultra-hazardous activities

Question 31

Nuisance per Se

Answer 31

D engages in activities prohibited by law, or violations of statutes, or engaging in abnormally dangerous activities. If the interference is substantial there is strict liability. (Brothels, Crack houses; fireworks; spite fences)

Question 32

Balance the Equities to decide if something is unreasonable (5) (land use)

Answer 32

(1) The extent and character of the harm
(2) The social value of the P’s and D’s property Use
(3) The sustainability of P’s & D’s use to the locality in question
(4) The burden on the P of avoiding the harm; and
(5) The impracticality of making the D prevent the harm

Question 33

Real Covenant Or Equitable Servitude

Answer 33

A right to compel an owner to perform some act on their land (maintain a fence); A right to compel an owner to pay money to maintain something (maintain a swimming pool available to all residents)

Question 34

Modern Transfer of Easements in gross

Answer 34

Courts have started allowing transfer of all easements in gross as long as the intent to transfer the easement from person to person is clear.

Question 35

Easement Created by Prescription

Answer 35

Earned by regular use, like adverse possession

Question 36

types of easements

Answer 36

(1) Expressly Created
(2) Implied by Prior Use
(3) Implied by Necessity
(4) Creation by Prescription

Question 37

Can an easement be created to benefit a third party?

Answer 37

Common Law: No
Modern: Give effect to the grantor’s intent:Easements can have any duration from a term of years to a life estate to a fee simple. The language in the granting document controls.

Question 38

Requirements for an irrevocable license (Aka easements by estoppel)

Answer 38

(1) Permission by the landowner to use their land
(2) Good-faith reliance on the permission the license gives, and
(3) The landowner’s knowledge (actual or constructive) of this reliance

Question 39

Factors to determine intent to lease or license (4)

Answer 39

(1) Uses permitted (the more the use of space is limited to a specific use, the more likely an easement);
(2) The specificity of location (the more specific a location, the more likely a lease)
(3) Rent reserved (periodic payment may indicate a lease)
(4) Duration (a lease is a limited in time; easements are usually unlimited).
** This matters because only a tenant, not an easement holder, can bring possessory actions such as ejectment, trespass, or nuisance.

Question 40

Quasi easement (Relevant factors to determine intent and reasonable necessity) (4)

Answer 40

(1) difficulty and cost of establishing another use;

(2) whether price paid reflects expected continued use of the servient portion of the original tract;

(3) whether grantee was given a warranty deed when a reservation is claimed (and the language of the grant)

(4) The extent to which the prior use was known (or might have been known) to the parties

Question 41

Ways to Terminate Easements

Answer 41

Release: These typically require a writing to comply with the Statute of Frauds.

Expiration: If the terms of the easement limit it by date or by some condition subsequent, then it ends on that date or on the occurrence of that event.

End of necessity (for easements by necessity)

Merger: Ends by merger if the easement owner later becomes the owner of the servient estate.

Estoppel: Can end if the servient owner reasonable relies to their detriment on statements made by the easement holder.

Abandonment (the most common way): When intent to abandon, terminates automatically

Prescription: If the servient owner wrongfully and physically prevents the easement from being used for the prescriptive period, then the easement terminates.

Condemnation: Gov’t exercises its eminent domain power.

Question 42

Two ways covenants can be enforced (real and equitable)

Answer 42

As a real covenant, which means that the benefited party seeks to enforce the covenant with a money damage remedy in a court of law; OR

As an equitable servitude, which means the benefited party seeks to enforce the covenant with injunctive relief in the court of equity.

Question 43

Requirements for real covenants to “run with the land” (5)

Answer 43

1 In writing (to comply with the Statute of Frauds)

2 Intent that the covenant run with the land (i.e., burden future purchasers of the burdened estate)

3 Notice of the covenant to the burdened party (actual, constructive, inquiry)

4 Privity of estate – both horizontal and vertical

5 The covenant “touches and concerns” the land

**Intent to bind and benefit successors – same for real & equitable Intent is the easiest of the elements to prove.

Question 44

When is horizontal privity required to enforce the covenant with $$ damages?

Answer 44

Ex. When Alex split his estate into two and sold his parcel to Bill, he put in a covenant that said that Bill’s parcel must be used for residential purposes only. Bill then sells to Courtney. Courtney is that new party, so there must be horizontal privity between Alex and Bill for Alex to sue Courtney to enforce the covenant.
* Vertical privity is ALWAYS required to enforce the covenant against the new party (or for a new party to enforce the covenant

Question 45

Requirements for Equitable Servitudes (4)

Answer 45

(1) Intent to run with the land

(2) Notice to burdened party (actual, constructive, inquiry)

(3) Covenant must touch and concern the land

(4) Comply with the statute of frauds (w/ exceptions)

*Note: Horizontal and vertical privity are not strictly required, but parties do need some interest in the land to sue.

*No need for privity for equitable servitudes

Question 46

Is vertical privity required for the burden to run? (covenants and equitable servitudes)

Answer 46

No. all subsequent possessors are bound by the servitude, just like for easements.

A few jurisdictions require vertical privity for the benefit to run

***Notice – not privity – is the key for the burden to run with equitable servitudes

Question 47

How do you tell the difference between a real covenant & equitable servitude?

Answer 47

Real covenants = seek money damages and must strictly comply with the statute of frauds and have vertical & horizontal privity. Real covenants cannot arise by estoppel, implication, or prescription (easements can).

Equitable Servitudes, generally, require compliance with the statute of frauds because it is an interest in land, BUT

the existence of an equitable servitude may be implied in equity under limited circumstances (known as a reciprocal negative covenant).

Notice is easier to satisfy than privity, as it only requires actual, constructive, or inquiry notice.

Note: Because equitable servitudes must arise out of a promise, they cannot be obtained by prescription.

Implied Equitable Servitudes Based on a Common Plan

Even if a covenant is not mentioned in a deed, most courts will imply an equitable servitude when a developer of a residential subdivision has manifested its intent in a common plan required throughout the development.

Question 48

Theory of common plans

Answer 48

Developers normally have sales brochures and record the Common Plan, so the buyer typically has constructive or inquiry notice of the restrictions, even if not mentioned in the deed.

Question 49

Termination of Covenants

Answer 49

Merger – unity of ownership like for easements.
Release – typically written and recorded.
Acquiescence – arises when the P has failed to enforce the servitude against other breaches and then seeks to enforce this breach against this D.

*Note: Acquiescence only applies to the P who has not enforced prior violations. Doesn’t prevent other P’s from suing – just that one who failed to enforce against other breaches.

Abandonment – intent to abandon means the servitude is not enforceable by anyone against that burdened parcel.

Unclean hands – this is an equitable doctrine, where a court will refuse to enjoin a violation of a servitude that the P previously violated.

Laches –involves an unreasonable delay by the P to enforce a servitude, which causes prejudice to the defendant. Note: this doesn’t technically terminate the servitude; it only bars enforcement.

Estoppel – if the D has detrimentally relied on P’s conduct/statements, then the court says it is inequitable to allow the P to enforce it.

Question 50

Change-Conditions Doctrine

Answer 50

STRICT: As long as the restriction is of value to some of the land, courts will usually not terminate it even though conditions have changed in such a way that the restriction decreases the value of other land.

Question 51

When does a servitude violate public policy?

Answer 51

(1) If it is arbitrary, capricious, or spiteful;

(2) If it “unreasonably burdens a fundamental constitutional right”;

(3) If it “imposes an unreasonable restraint on alienation of the property” or on trade or competition (makes it hard to sell);

(4) If it is unconscionable

In Osborne v. Power, the court held that a large Christmas light display was a nuisance and violated the subdivision regulation against creating nuisances.

Question 52

Restrictions regarding Nahrstedt

Answer 52

(1) Restrictions in the original master plan are enforced regardless of the reasonableness of the restrictions.

They can be struck down if they violate a constitutional right or are against public policy

(2) Restrictions created later by the association are subject to a reasonableness requirement

Question 53

Two tests that must be satisfied to qualify for a variance

Answer 53

(1) the applicant must show exceptional and undue hardship;

**Undue hardship means that without a variance, the property in question could not be effectively used. The hardship must not be self-imposed.

**Courts will consider efforts by the property owner to alleviate the hardship

(2) the applicant must show that to grant a variance would not be detrimental to the area (zoning plan).

Question 54

Conditional Variance

Answer 54

A permitted use granted only if certain conditions are met that minimize the impact of the adverse use to the neighbors.

These conditions might relate to fence size, amount of outdoor lighting, enclosure of buildings, etc.

NOTE: Zoning Boards may not limit a variance to just the current landowner. All variances “run with the land.”

Question 55

Use Variance

Answer 55

relax the restrictions on the uses of a particular area

Higher burden of proof for use variances than area variances.

Question 56

How do special exceptions differ from variances?

Answer 56

While a variance is an administratively authorized departure from the zoning ordinance, “an exception is a use permitted by the ordinance in a district it is not necessarily incompatible, but where it might cause harm if not watched.”

Typically, exceptions require large amounts of land and involve uses that have the potential to cause injury to the surrounding area.

Examples: airports, landfills, and hospitals.

Zoning boards grant exceptions on a case-by-case basis, and usually involve scrutiny about the harms to the location involved.

Question 57

Modern justifications for zoning (3)

Answer 57

Things like aesthetic zoning just don’t fit into the nuisance rationale, so lawmakers have come up with other justifications.

(1) Population growth

(2) Decreased or increase in gov’t tax revenue

(3) Increased environmental activism

Question 58

Restrictions that cap the total number of occupants per dwelling fall within what exemption

Answer 58

FHA Exception and are ALLOWED.

BUT restrictions designed to protect the family character of the neighborhoods are not allowed, so they will be struck down.

Question 59

The key challenges to Exclusionary Zoning on the 14th Amendment Equal Protection Grounds

Answer 59

The key to these challenges is what standard the court applies:

Plaintiff’s counsel has to get the court to apply a heightened, strict scrutiny standard. This requires showing the zoning infringed on a fundamental right – like discrimination.

Proof of discriminatory effect is not enough. The P’s must show a racially discriminatory motive.

This can be shown by a historical pattern of zoning in the community, from the history behind the challenged ordinance, to departures from standard policies, and, of course, by actual discriminatory comments on the record (which are rare).

Question 60

Regulatory Takings: Key Issue

Answer 60

Whether a taking has occurred as a consequence of a gov’t action (other than eminent domain), which does not allow the property owner to get just compensation.

Remember, if a government enacts a zoning ordinance or a statute that impacts property, it is under no obligation to pay landowners from the restricted use – UNLESS it amounts to a regulatory taking!

So they key issue is where to draw the line between appropriate regulations and regulatory takings…

Question 61

Ad Hoc balancing Test factors

Answer 61

Diminution in value b/c of regulation (just one factor)

How much has regulation interfered with distinct investment-backed expectations?

Character of the Gov’t action/regulation

This regulation had extensive provisions allowing for transferring of the property rights to an adjacent property. Thus, Penn Central received some benefit from the regulation for its other – non-landmark properties

Question 62

Two standards for regulatory takings cases

Answer 62

(1) Ad hoc balancing from Penn Central for cases where the regulation does not require physical appropriation by the government.

(2) Per-se-takings standard, where the regulation requires some physical appropriation of a person’s property (requiring installation of cable boxes, handing over raisins, etc.)

Question 63

Per Se takings

Answer 63

(1) Loretto/Horne – Physical appropriation test:
does the regulation require/authorize a premanent physical appropriation of private property by either the gov’t or a third party?

(2) Lucas – Total-wipeout rule:
If the value of the property is reduced to essentially zero b/c of the regulation, then there is a per se taking and no balancing is needed. ** Any time per se: look to nuisance. If common law nuisance, then justified

The nuisance theory is the exception for takings: If the regulated activity would be a common-law nuisance according to that state’s laws, then the regulation is justified and won’t amount to taking.

Question 64

Standard for exactions to be permitted

Answer 64

1. There must be an “essential nexus” between the legitimate public purpose and the means imposed to achieve them. (Nollan)

A gov’t can’t put on a condition unless that condition is connected to the reason it is requiring the permit in the first place.

2. A rough proportionality must exist between the exaction and the impact of the proposed development. (Dolan)