Kaplan 510-549 - Ownership of RP

Question 1

What is an estate in land?

Answer 1

An interest in real property that is presently or may become possessory

Question 2

What is the difference between a freehold estate and a non-freehold estate?

Answer 2

– Freehold: gives the owner of the estate title to or a right to hold the property
– non-freehold: just gives possession

Question 3

What are different types of freehold estates?

Answer 3

Fee simple absolute, defeasible estates, life estates

Question 4

What is the largest possible estate in land that a person can hold?

Answer 4

A fee simple absolute

Question 5

What are the rights that accompany a fee simple absolute?

Answer 5

This is an aggregate of all possible rights that includes the right to sell/convey all/part of the land and the right to devise the land

Question 6

How long can a fee simple absolute last?

Answer 6

In perpetuity. If the owner dies intestate, the property will pass to his heirs via intestacy

Question 7

What are the words that are usually used to create a fee simple absolute?

Answer 7

“To A and his heirs.“

Question 8

What is the difference between words of purchase and words of limitation?

Answer 8

– words of purchase: this describes the person who will take an interest in the land
– words of limitation: describes the nature of the estate that was gotten

Question 9

Find the words of purchase in the words of limitation in this conveyance, O conveys “To A and her heirs.“

Answer 9

• words of purchase: “to A” because A takes an interest

– words of limitation: “and her heirs“ because that is the nature of the estate being gotten

Question 10

Under common law, what was required for a fee simple absolute to be created, and what about modern law?

Answer 10

– Common law: it had to have the words “and his heirs“ in order to be a fee simple absolute
– modern law: as long as you say “to someone“ (or: “to A”) it is assumed that a fee simple absolute was created

Question 11

What is a defeasible estate?

Answer 11

An estate that may terminate before its maximum duration has run

Question 12

What are the different types of defeasible estates?

Answer 12

Fee simple determinable, fee simple subject to condition subsequent, fee simple subject to executory interest, fee tail

Question 13

What is a fee simple determinable?

Answer 13

It terminates automatically when a named future event happens.

It uses words like: for so long as, during, while, or until.

It is created in one clause with a limitation built into that clause. It is followed by a possibility of reverter, which may be implied

Question 14

What is an example of a fee simple determinable?

Answer 14

“To A and his heirs for so long as the land is used for educational purposes.“

Question 15

What is a fee simple subject to a condition subsequent?

Answer 15

This is when the estate can be cut short if it is re-taken by the grantor or third-party on the happening of some named future event.

This gives the grantor the right to take the estate, but it does not automatically terminate the estate.

It is created by these words: provided, however; however if; but if; on condition that; in the event that.

This is created in two separate clauses with the condition being in the second clause

Question 16

What is an example of a fee simple subject to a condition subsequent?

Answer 16

“To A and his heirs, but if the land is not used for education, then O has the right to re-enter and terminate the estate.“

Question 17

What is a fee simple subject to executory interest?

Answer 17

This is an interest that is automatically divested in favor of a third person if a named event happens.

These are followed by a shifting executory interest and subject to RAP

Question 18

What is an example of a fee simple subject to executory interest?

Answer 18

“To A for so long as the land is used for charity, but if it ceases to be used for that, then to B.”

Question 19

What was a fee tail at early common law?

Answer 19

It was a freehold estate that descended to the grantee’s lineal descendants/children only

Question 20

What are the different types of fee tail that can be created?

Answer 20

– Fee tail general
– fee tail male or female
– fee tail special

Question 21

What is a fee tail general?

Answer 21

Children of the grantee take when the grantee dies.

“To A and the heirs of his body.“

Question 22

What is a fee tail male or female?

Answer 22

Descent is limited to the male or female heirs of the grantee

“To A and the heirs female of his body.“

Question 23

What is a fee tail special?

Answer 23

When descent is limited to the grantee’s descendants by a specific spouse

“To the heirs of his body by his wife B“

Question 24

What is a fee tail?

Answer 24

It was primarily used at common law and it meant that the estate would descend to the grantee’s lineal descendants/children only.

It is followed by a reversion in the grantor or a remainder in a third-party that only becomes possessory if the grantee’s lineal line fails

Question 25

How are fee tails treated at modern law?

Answer 25

Today they are disfavored. If the words “and the heirs of his body“ are used:
– most states say that grants a fee simple absolute
– some states say the grantee has a life estate with a remainder per stirpes in the grantee’s lineal descendants in being at the time of the life tenant’s death

Question 26

What happens if the words of the grant are not clear regarding what type of freehold estate was given?

Answer 26

– A covenant is preferred over a DE (defeasible estate) because then the award is money instead of forfeiture
– a FSSCS (fee simple subject to a condition subsequent) is preferred over a FSD (fee simple determinable) because FSSCS does not make forfeiture automatic

Question 27

What are the abbreviations for the three major types of defeasible estates?

Answer 27

– FSD
– FSSCS
– FSSEI

Question 28

What is a life estate?

Answer 28

An estate that lasts for the duration of the grantee’s life.

It uses words like “to A for life.“

Question 29

What is the duty to repair for a life tenant?

Answer 29

He must maintain the property in a reasonable state of repair, with the exception of ordinary wear and tear.

This is limited to the extent of the income gotten, or if he personally occupies the land, to the extent of the reasonable rental value of the land

Question 30

What is the duty to repair for a tenant that occupies the land for a term of years?

Answer 30

He has a duty to maintain the property in a reasonable state of repair, with the exception of ordinary wear and tear.

Question 31

What is the duty of a life tenant with regard to a mortgage on the property?

Answer 31

He has a duty to pay the interest on a mortgage to the extent of profits derived from the property.

Question 32

What is the duty of a tenant for years with respect to a mortgage on the property?

Answer 32

He has no duty to make mortgage payments

Question 33

What is the duty of a life tenant with regard to paying taxes?

Answer 33

He has a duty to pay all ordinary taxes to the extent of profits gotten from the property.

Question 34

What is a duty of a tenant for years with regard to paying taxes on the property?

Answer 34

He has no duty to pay property taxes unless:
– the lease is perpetual or for a long-term with an option to renew forever
– the tenant’s lease has no obligation to pay rent
– the tenant erected improvements on the land for his own benefit

Question 35

What duty does a life tenant have with regard to paying special assessments?

Answer 35

He has to pay the cost of these if the life of the public improvement will be shorter than the life tenant’s estate. If the improvement will last longer, such as curbs or streets, equitable apportionment is made

Question 36

What is the duty of a tenant for years with regard to paying special assessments?

Answer 36

There is no duty to pay these

Question 37

What is a non-freehold estate?

Answer 37

At leasehold estate, which is limited in duration.

– traditionally: the landlord maintained the fee which was subject to the leasehold interest
– modernly: the landlord holds a reversion after the leasehold estate

Question 38

What is an example of a leasehold estate?

Answer 38

“To A for the term of 10 years.“

Question 39

What are all the different future interests?

Answer 39

– Reversionary interest
– remainder
– executory interests
– possibility of reverter and power of termination

Question 40

What is a reversionary interest?

Answer 40

A reversion is a future interest kept by the grantor where he transfers less than a fee interest to a third person.

Majority rule: reversions are transferable/dividable/descendible

Reversionary interests are not subject to RAP

Question 41

What is an example of a reversionary interest?

Answer 41

“To A for life, then to B for life, then to C for life.“

The entire FSA is not accounted for, so following all the life estates, O has a reversion

Question 42

What type of interest does O have?

“To A for 10 years.“

Answer 42

He has a reversion

Question 43

If a grantor conveys his own reversion to another party, that person’s interest is defined as what?

Answer 43

A reversion (it is still called a reversion even though it is now in a third-party)

Question 44

If a grantor has a reversion, but he dies, what happens to his reversion?

Answer 44

It passes through the terms of his will or via intestacy

Question 45

What is a remainder?

Answer 45

A future interest created in a third person that takes effect after the natural termination of the preceding estate.

This is subject to RAP

Question 46

How does a remainder become contingent?

Answer 46

– The taker is unascertained, or
– the interest is subject to a condition precedent so it does not fall in automatically on the natural termination of the previous estate

Question 47

Is a contingent remainder transferable?

Answer 47

– common law: it can be descended or devised, but not transferred inter vivos
– modern law: it is transferable, descendible, and devisable

Question 48

What is an example of a contingent remainder?

Answer 48

“To A for life, reminder to A’s widow and her heirs.“

A has a life estate and his widow has a contingent remainder in fee simple because she is not yet ascertained. So O’s estate retains a reversion

Question 49

Does O have a reversion if this conveyance is made:

“To A for life, remainder to B and her heirs if B reaches 21.“ At the time of creation, B is not yet 21.

Answer 49

Yes, O has a reversion because B’s remainder interest is contingent since he has not yet filled the condition precedent of having to turn 21

Question 50

How do you destroy a contingent remainder?

Answer 50

At common law this could happen if:
– the remainder fails to vest by the natural termination of the prior vested estate
– through the doctrine of merger
– the holder of the present possessory estate surrenders his interest before the contingent remainder vests

Question 51

What is an example of how a contingent remainder can be destroyed because it failed to vest by the natural termination of the prior vested estate?

Answer 51

“To A for life, remainder to B if he reaches 21.“ A then dies before B is 21.

B isn’t 21 yet, so his contingent remainder is destroyed and O’s reversion becomes possessory

Question 52

How can the doctrine of merger destroy a contingent remainder?

Answer 52

If one party that had a present or future interest in the land, by subsequent transactions, obtained all outstanding present and vested estates in that property

Question 53

What are the different ways that merger can happen and thus destroy a contingent remainder?

Answer 53

– by surrendering a present estate to the owner of the future estate
– by releasing a future estate to the owner of a present estate
– when all holders of present and future estates convey all their interests to a third-party

Question 54

What is an example of a contingent remainder that is destroyed through merger?

Answer 54

“To A for life, remainder to B if he earns a law degree.“

A has a life estate and B has not yet earned a law degree. B has a contingent remainder and O has a reversion.

If one year later O conveys his reversion to A, and B still has no law degree, A now has a life estate and the reversion. Those two interests merge because they’re not separated by a vested estate. A then gets a fee simple absolute, and B’s contingent remainder is destroyed

Question 55

What is the modern view regarding destructibility of contingent remainders?

Answer 55

Modernly many jurisdictions have abolished this rule. If a contingent remainder has not vested at the natural termination of the prior vested estate, it becomes an executory interest and is subject to RAP

Question 56

What is a vested remainder?

Answer 56

The taker must be ascertained or ascertainable at the time the remainder is created.

A vested remainder must fall in automatically at the natural termination of the previous estate, so there can be no conditions precedent to taking.

Vested remainders are transferable, descendible, and devisable. They are not subject to RAP

Question 57

What is an example of a vested remainder?

Answer 57

“To A for life, remainder to B and his heirs.“

A has a life estate, and B has a vested remainder in fee simple because he is identified, and his interest falls in automatically at the natural termination of the previous estate/A’s death

Question 58

What is a vested remainder subject to open/vested remainder subject to partial divestment?

Answer 58

This is when a remainder has been made to a class (ie: “my kids”) and at least one member has satisfied the condition precedent to vesting, and other members may be able to join the class later.

Question 59

What is an example of a vested remainder subject to open?

Answer 59

“To A for life, remainder to A’s kids.“ At the grantor’s death, A is living and has one child, B.

A has a present possessory life estate and B has a vested remainder subject to open, because A could have more kids

Question 60

What is a vested remainder subject to total divestment?

Answer 60

When someone has a presently vested remainder that may be terminated if a future event happens.

Ie: “to A for life, remainder to B as long as the land is used for education.“

A has a life estate, and B has a vested remainder subject to total divestment. O retains a possibility of reverter

Question 61

What is an executory interest?

Answer 61

A future interest in a third person that cuts short the previous estate. Any interest created in a third-party that follows the granting of a fee is always an executory interest.

Executory interests are transferable, descendible, and devisable.They are also subject to RAP

Question 62

What are the two different kinds of executory interests?

Answer 62

– Shifting executory interest

– springing executory interest

Question 63

What is a shifting executory interest?

Answer 63

An interest that cuts short a prior estate created by the same conveyance. The interest passes from one grantee to another

Question 64

What is a springing executory interest?

Answer 64

An interest that follows a gap in possession or divests the estate of the transferor. The interest passes from a grantor to a grantee

Question 65

What is an example of a shifting executory interest?

Answer 65

“To A, but if liquor is served on the land, then to B and his heirs.“

A has a fee simple subject to an executory limitation. B has a shifting executory interest because his interest may cut short A’s estate

Question 66

What is an example of a springing executory interest?

Answer 66

“To A for life, remainder to B and his heirs one month after B’s death.“

A has a life estate. B has a springing executory interest because it cannot become presently possessory until one month after the natural termination of a life estate. O retains a reversion. After A dies, O’s reversion becomes possessory, and one month later, the fee simple springs out of O to B

Question 67

What is a possibility of reverter?

Answer 67

A future interest in the grantor that follows a determinable estate. Anytime there is a fee simple determinable, that automatically creates the possibility of reverter in the grantor.

• Common law: this can descend through intestacy, but cannot be devised or transferred inter vivos
  – modernly: it is transferrable, devisable and descendible

The SOL begins to run as soon as the limitation occurs because the property automatically reverts to the grantor when that limitation happens

A possibility of reverter is not subject to RAP

Question 68

What is a power of termination/right of reentry?

Answer 68

A future interest in the grantor that follows a fee simple or life estate subject to a condition subsequent. This requires the grantor to reserve this right in the conveyance either expressly or by implication.

When the event happens, the property does not automatically revert back to the grantor, he must exercise the power of termination through an affirmative action to retake the property.

• common law: this power can descend through intestacy but cannot be devised or transferred inter vivos
• Modernly: it is descendible and devisable, but not transferrable Inter vivos

The SOL does not begin to run until the grantor tries to exercise the right.

The power of termination is not subject to RAP

Question 69

What is an example of a power of termination/right of reentry?

Answer 69

“To A and his heirs, but if alcohol is served on the land, then O and his heirs may re-enter and terminate the estate.“

A has a fee simple subject to condition subsequent and O has a power of termination. If alcohol is served, O must take affirmative steps before A’s estate is terminated. If O transfers this power of termination to C, it is still called a power of termination

Question 70

What are different rules that affect ownership interests in property?

Answer 70

– The rule in Shelley’s case
– doctrine of worthier title
– rule of convenience
– postponed gift to a class
– immediate gift to a class coupled with a condition precedent
– gift to a class with a combination of postponements
– waste

Question 71

What is the rule in Shelley‘s case?

Answer 71

A rule against remainders in the grantee’s heirs. It applies when the grant looks like this, “to A for life, reminder to the heirs of A.”

Requirements:
– A must get a freehold estate [life estate or fee tail]
– A’s heirs must get a remainder in fee [or in tail]
- the same instrument must create both A and his heirs’ interests, and
– both the estates must be legal or both must be equitable

If all of those are met, then A gets both a life estate and the remainder, and by merger A gets a fee simple, so his heirs take nothing.

This is a rule of law that the courts have to treat as an irrebuttable presumption, but this rule has been abolished by statute or judicial decision in most states

Question 72

What is the other name for the rule in Shelley‘s case?

Answer 72

The rule against remainders in grantee’s heirs

Question 73

What is the other name for the doctrine of worthier title?

Answer 73

The rule against remainders in grantor’s heirs

Question 74

What is the doctrine of worthier title?

Answer 74

It is a rule against remainders in the grantor’s heirs. It comes up in grants like this, “to A for life, remainder to the heirs of O.”

It requires that:
– A must get an estate less than a fee simple, like a life estate or term of years
– O’s heirs must get a remainder or executory interest
– both interests must be created by the same instrument, and
– both interests must be legal or both must be equitable.

This is a rule of construction, not a rule of law. The language that leaves a remainder to O’s heirs creates a rebuttable presumption that O intended to retain his interest in himself as a reversion. This can be rebutted by clear and express evidence that he did not intend a remainder in his heirs. If the presumption is raised and not rebutted, A gets a life estate and O keeps the reversion, so his heirs take nothing on their own.

Modernly this doctrine applies to inter vivos transfers only, not to testamentary ones

Question 75

What is the rule of convenience?

Answer 75

This says that a class closes when a member of the class is entitled to distribution. Applies to these classes: children/grandchildren, brothers/sisters, nephews/nieces, cousins, issue, descendants, or family of a designated person

Possible options:
– if the class is already closed at the time the gift takes effect: all members of the class at that moment take and anyone later born will not be a member of the class
– if the class has conceived members at the time the gift takes effect: they take immediately, the class closes, and that excludes any after born children
- if the class has no members at the time the gift is made: all members of the class are included and may take, and the class stays open until all possible members are born

Question 76

What are the rules for a postponed gift to a class with no condition precedent?

Answer 76

This deals with what happens to a class at the time a postponement ends. A postponement could come from something like the end of a life estate.

Different situations:
– if class is already closed at time the postponement ends: all members of the class are included and take
– if class has members but is not yet closed at the time the postponement ends: all conceived members take, the class closes, and this excludes afterborn kids
– if the class has no members at the time the postponement ends: all members are included regardless of when they were born

I.e: T devices, “To A for life, remainder to the children of B.”
- if B is dead at the time of T’s death: the class of B’s kids is closed, so all of these kids are included and take
– if B dies after T, but before A: the class of B’s kids is closed, so all of his kids take
– if B is alive at A’s death, and has kids: all kids currently alive take, the class closes, and excludes after-born kids
– if B is alive but does not have kids: no kid is entitled to immediate distribution, the class stays open, so any of B’a kids regardless of when they were born or allowed to take

Question 77

How does it work when there’s been an immediate gift to a class coupled with a condition precedent?

Answer 77

The class closes when the first member of the class satisfies the condition. All the then-born members of the class are included and may take when they satisfy the condition, and any after-born children are excluded.

I.e: conveyance “to B’s kids who reach 21.“
– If B is dead at the time of conveyance: the class will be closed, so all of his kids are included and can take if they reach 21.
– If B is alive and has a child who has reached 21: the class is closed because that child is entitled to immediate distribution. All of B’s then-born children are included and can take when they reach 21, but afterborn children are excluded
– if B is alive and has one child that is not yet 21: the class stays open. The class closes when one child reaches 21. Then all children that are born at that time will be included and can take when they reach 21, but any child born after is excluded
– if B is alive and has no kids: the class stays open until a child of B reaches 21. All children of B born at the time that that first child reaches 21 will be included and can take when they reach 21. All children born after are excluded

Question 78

What happens when there has been a gift to a class with a combination of postponements?

Answer 78

The postponement is deemed to end, and the class closes when the last condition is satisfied. All members born before the class closes are included and can take if they satisfy the condition, but all later born people are excluded

I.e.: conveyance, “To A for life, remainder to B’a kids who reach 21.“ The first postponement is that A must die, and the second postponement is that the children must reach 21.
– If B is dead when the conveyance is made: the class of B’s kids closes and all of his kids are included and can take when they reach 21
– if B is alive at conveyance but dies before A: the class of his kids closes, and all of his kids are included and can take when they reach 21
– if B is alive at A’s death and has a kid that is 21: that kid can take, the class closes at that time, all kids born before are included and can take when they reach 21, but later born kids will be excluded
- If B is alive at A’s death and has no kids or none of his kids have reached 21: the class stays open until a child reaches 21, and then it closes. All kids conceived at that time are included and can take when they reach 21, but afterborn kids are excluded

Question 79

What are situations that the natural resources on land can be consumed by a life tenant or leasehold interest holder and not be considered voluntary waste?

Answer 79

For the repair and maintenance of the property, or with the permission of the grantor, or open mines doctrine

Question 80

What is another name for permissive waste?

Answer 80

Involuntary waste

Question 81

What are the two different ways that involuntary or permissive waste can occur?

Answer 81

Allowing the property to fall into disrepair, or failing to pay a mortgage interest payment, taxes, or special assessments

Question 82

What are the two different views about ameliorative waste?

Answer 82

– Traditionally: this was prohibited
– modernly: it is allowed if:

• the market value of the remainderman’s interest is not impaired, and
• either: the improvement is permitted by the remainderman, or a substantial and permanent change in the neighbourhood deprived the property of a reasonable current value

Question 83

Who has standing to sue for ameliorative waste?

Answer 83

• can sue for past or future waste: the holder of a reversion, and vested remaindermen
  – can only sue to prevent future waste, but not for past waste: a contingent remaindermen

Question 84

What is a cotenant?

Answer 84

A concurrent owner of property. This happens when two or more people share an interest in real property

Question 85

If land is conveyed “to A and B“ what is the presumption in the way it is held?

Answer 85

It is presumed to be a tenancy in common because that is the presumed form of cotenancy. So this would create a fee simple absolute for A and B as tenants in common with no need for any special language

Question 86

What are the different ways that a tenant in common can transfer his interest in the property?

Answer 86

• INTER VIVOS either VOLUNTARILY by a conveyance, lease, mortgage, etc. or INVOLUNTARILY through foreclosure on a mortgage or a judgement creditor lien
• can DEVISE his interest
• interest can DESCEND through intestacy

Question 87

Traditionally what are the words that were required to create a joint tenancy?

Answer 87

“To A and B as joint tenants and not as tenants in common, with full right of survivorship.“

Question 88

What are the four unities that are required to create a joint tenancy?

Answer 88

– Unity of time: tenants must take at the same time
– unity of title: tenants must take by the same instrument
– unity of interest: tenants must take equal shares of the same type
– unity of possession: each joint tenant has the right to possess the whole property

Question 89

Under the traditional rule for joint tenancy, why is it not possible for a sole owner of property to create a joint tenancy between himself and another person by conveying a joint interest directly to the other person?

Answer 89

Because traditionally it was necessary to have the four unities in order to create a joint tenancy, so if you convey an interest to create a joint tenancy that means that the unity of time and the unity of title are broken because you didn’t both take the interest at the same time and you didn’t both take it by the same instrument since you already had the interest.

For this reason it is necessary under the traditional rule that the owner convey the property to a strawman, who then conveys the property back to the owner and the person as joint tenants.

Some jurisdictions now do not require the unities of time and title, which means that a strawman is also not required and a sole owner can create a joint tenancy between himself and another just by conveying a joint interest directly to the other person

Question 90

If A and B are joint tenants, and A dies leaving C as her sole heir, what interest does C take in the property?

Answer 90

No interest, because after A’s death, B’s right of survivorship would take over and he would become the sole owner

Question 91

What happens to a joint tenancy if you transfer your interest?

Answer 91

That severs the joint tenancy. The rationale is that transfer has broken the unities of time and title because now this new person has taken his title through a different instrument and at a different time than the other joint tenant, so that changes it from joint title to tenant in common

Question 92

Is it possible for a joint tenant to devise his interest or for his interest to descend by intestacy?

Answer 92

No, because when he dies the other tenant gets all of his interest

Question 93

If a creditor forces a sale of a joint tenant’s interest to satisfy a debt that is owed, what happens?

Answer 93

That severs the joint tenancy and creates a tenancy in common between the other tenant and the conveyee

Question 94

If only one joint tenant mortgages his interest in the joint tenancy, what is the effect of that mortgage?

Answer 94

– Title theory states: this causes the legal interest of that cotenant to be transferred to the mortgagee. So the mortgage severs the joint tenancy because the unities have been destroyed. Most jurisdictions do not follow this
– Lien theory states: the mortgagee just gets a lien on the property, so no severance occurs because the unities stay intact. Only a foreclosure will sever the joint tenancy. Most jurisdictions follow this

Question 95

Traditionally, in order for a tenancy by the entirety to exist, what words had to be used?

Answer 95

“To H and W as tenants by the entirety and not as joint tenants or tenants in common, with full right of survivorship.“

Question 96

How is a tenancy by the entirety created both traditionally and modernly?

Answer 96

– traditionally: needed specific words of “tenants by the entirety“ to be used in the conveyance
– modernly: many states have statutes that create a presumption of this if the conveyance is to a married couple, even if they are not identified as a married couple in the deed

Question 97

What happens in a tenancy by the entirety if one spouse tries to unilaterally convey the interest or encumber it?

Answer 97

The conveyance is considered to be void

Question 98

What is the only situation that a judgement creditor can execute judgement on a property that is owned as a tenancy by the entirety?

Answer 98

Only if both spouses are joint debtors.

Question 99

What are the different ways that a tenancy by the entirety can be terminated?

Answer 99

– by a joint conveyance of both spouses
– by conveyance of one spouse to the other
– or if the spouses divorce

Question 100

Is it possible to get a partition of a cotenancy?

Answer 100

Yes, each cotenant has the right to seek partition of the property

Question 101

What are the two different ways that you can get partition of a cotenancy?

Answer 101

– Voluntary partition: exchange of mutual deeds among cotenants or sale of the property and then dividing the proceeds
- Involuntary/judicial partition: court action that divides the property either physically or by sale. Traditionally physical partition is preferred unless that would be impractical. If a physical partition cannot produce equal shares, the party that got the larger portion has to make a cash payment to the other party

Question 102

What is the entitlement of each cotenant?

Answer 102

They are entitled to possess the whole property

Question 103

When does wrongful ouster occur with regard to cotenants?

Answer 103

When one cotenant wrongfully excludes another from possession of the whole or any part of the property

Question 104

Does an out of possession cotenant have the right to share in rent and profit derived from the other cotenant from third parties?

Answer 104

Yes

Question 105

Does an out of possession cotenant have the right to demand rent from a cotenant that is an actual possession of the premises?

Answer 105

No, unless the cotenant in possession wrongfully ousted the other cotenant or exploited the property in a way that resulted in permanent depreciation

Question 106

What are the rules about cotenants seeking contribution for repairs?

Answer 106

– Common law: does not allow this
– modernly: contribution can be compelled if the repairs were requested by the repairing tenant and refused by the others

Question 107

If a cotenant paid the mortgage or taxes, can he seek contribution from the other cotenants?

Answer 107

Yes

Question 108

What are the different ways you can create a lease?

Answer 108

– expressly: either orally or in writing. Although a writing is necessary under the SOF if the term is for more than one year
– impliedly: through either the conduct of the parties if a written lease is invalid, or when a holdover tenant pays rent and the landlord accepts the rent

Question 109

What is a good mnemonic to help remember the different types of leases?

Answer 109

PSAT
– P: periodic
– S: tenancy at sufferance
- A: at will
- T: term of years

Question 110

Modernly is it possible to give notice to end a periodic tenancy orally?

Answer 110

Yes

Question 111

What are the major duties that a tenant owes?

Answer 111

Pay rent, not commit waste, repair

Question 112

What are the common law and modern rules regarding a tenant’s duty to pay rent if the property is destroyed?

Answer 112

– Common law: The tenant still must pay rent even if the premises are destroyed because he still has possession of the land. The only exception is if he leased a part of a building, then he would be excused from paying rent
– today: the tenant is relieved from paying rent if the premises is destroyed, with the only exception being that he is not relieved if he intentionally or negligently caused the destruction

Question 113

Is it acceptable for a tenant to commit ameliorative waste?

Answer 113

No (this is only allowed in some circumstances for life estates)

Question 114

What are the different approaches to a tenant’s duty to repair?

Answer 114

– Common law estate theory: Landlord has no duty to repair during the lease. Tenant has a duty to not commit waste, so he must repair the premises. This includes minor repairs that keep the building safe from water and wind, but he doesn’t have to rebuild if the premises is destroyed by an act of God, and neither does the landlord. If the landlord and tenant agree on how to allocate repair duties, such as the tenant assumes a general duty to repair, then he is responsible for repairing the premises from anything including fire and storms. He must also rebuild or replace if it is destroyed by those things
– modern contract theory/Majority rule: the parties are free to covenant for their duties. Unless they covenanted otherwise, the common law rule about the duty to repair applies. If a tenant has agreed to a general covenant to repair, he must repair, but ordinary wear and tear is excepted from this and so are acts of God. If the tenant covenants to repair without exception, he must make all repairs. If there was no covenant in place, the landlord must repair damages from casualties
– modern trend: tenant is not required to rebuild if the destruction was not his fault

Question 115

What is the landlord’s major duty if a leasehold has been created?

Answer 115

To deliver possession of the premises at the start of the lease term

Question 116

What are the two different approaches to a landlord’s duty to deliver possession of the premises at the start of a lease term?

Answer 116

– Majority/English rule: the landlord must deliver actual possession of the property
– minority/American rule: the landlord only has to deliver legal right to possession, not actual possession

Question 117

What are some duties that state law usually creates for Landlord?

Answer 117

The duty to provide things like running water and heat

Question 118

What is an assignment?

Answer 118

When the tenant transfers to a third person all of his rights, title, and interest in the leased premises. Then the assignee comes into privity of estate with the landlord

Question 119

What is the difference between privity of contract and privity of estate when it comes to assignments and subleases?

Answer 119

– Privity of contract: this exists only between original parties to an agreement, unless there is a novation
– Privity of estate: this comes through the succession in rights to the same property by multiple parties.

Question 120

How does privity of estate work?

Answer 120

The landlord enters a lease agreement that conveys a part of his rights (right to presently possess the property) to the tenant. By doing this the parties are in privity of estate.

If the tenant grants something less than his full rights in the property to another party (perhaps via a sublease) that party does not enter into privity of estate with the landlord, he is only in privity of estate with the tenant.

The tenant and subtenant enter into privity of estate, but the subtenant does not enter into privity of estate with the landlord, because there’s no direct relationship. The landlord and the original tenant stay in privity of estate

Question 121

If LL and T enter into a five year written lease, and then two years later T subleases the property to S for one year, who has privity of estate?

Answer 121

T and S are in privity of estate with each other, but LL and S are not. LL cannot sue S directly for anything, instead LL must sue T, who can then sue S

Question 122

What is the only way that an original tenant can stop being liable to the landlord after he has assigned or subleased?

Answer 122

If there has been a novation

Question 123

What is a novation?

Answer 123

A separate agreement between the landlord, original tenant, and assignee where the landlord agrees to discharge the original tenant from liability in exchange for the assignee becoming liable

Question 124

What type of privity applies to an assignment?

Answer 124

The assignee comes into privity of estate with the landlord. So if rent is not paid, the landlord can sue the assignee

Question 125

If L and T enter a five-year lease, and one year later T assigns the lease to T2. If T2 fails to pay rent to L, who can L sue?

Answer 125

L can sue either T because of privity of contract with him, or T2 because of privity of estate

Question 126

If L and T enter a five-year lease, and one year later T assigns the lease to T2. Then six months later T2 assigns to T3. If T3 fails to pay rent to L, who can L sue?

Answer 126

L can sue T because of privity of contract, and T3 because of privity of estate. But he cannot sue T2 because he is not in privity of contract or privity of estate with that person

Question 127

How are covenants against assignments or subleases construed?

Answer 127

Strictly against the landlord

Question 128

What is the rule in Dumpor’s case?

Answer 128

If a landlord waives the covenant against assignment, it is then unenforceable as to the next assignment. This rule does not apply to subleases and does not apply when the landlord specifies that the waiver is “one time only.“

Question 129

What is a silent consent clause?

Answer 129

When a prohibition against assignments or subleases does not give a standard or condition for giving or withholding consent

Question 130

What is the majority rule and minority rule for silent consent clauses?

Answer 130

– Majority rule: a silent consent clause gives the landlord the right to withhold consent for any reason or no reason, even if it is arbitrary or unreasonable, as long as it is not discriminatory.
– Minority rule: a silent consent clause requires the landlord to be reasonable in withholding consent

Question 131

What are a landlord’s remedies if a tenant breaches?

Answer 131

If the tenant doesn’t pay rent, or materially breaches, the landlord can seek eviction and/or damages

Question 132

What are the two approaches to rent acceleration clauses in leases if the tenant breaches?

Answer 132

– traditionally: acceleration is not available

– modernly: it is available

Question 133

If a landlord is bringing an action against a tenant for not paying rent, what are the grounds that a tenant can defend on?

Answer 133

Non-compliance by the landlord or destruction of the premises

Question 134

What does it mean to say that a tenant abandoned the premises?

Answer 134

He vacated the property with no intent to return, and he failed to pay rent.

Question 135

Traditionally if a tenant abandons the premises, what are the options for what the landlord can do?

Answer 135

– Retake the premises
– ignore the abandonment and continue to hold the tenant liable for rent
– re-enter and relet the premises

Question 136

What are the two different approaches to self-help for a landlord removing a breaching tenant?

Answer 136

– Traditionally: Landlord can use self help to remove a breaching tenant from the premises
– modernly: self-help is prohibited, and the landlord has to seek court action to re-enter the premises

Question 137

Generally landlords are not liable to their tenant or others on the premises with the consent of the tenant for injuries except in what situations?

Answer 137

• undisclosed dangerous conditions that are known or should’ve been known to the landlord but are not known to the tenant
• a condition is on the property that is dangerous to people outside of the property
  – the premises are leased for admission to the public
  – parts of the land are kept in the landlord’s control but are available for use by the tenant
  – landlord has contracted to repair
  – the landlord has been negligent in making repairs

Question 138

What are the three different types of security deposits?

Answer 138

• tenant deposits a sum of money: that the landlord can draw from to make up defaults or pay for damages. Landlord must account for anything he withdraws, and at the end of the tenancy the tenant gets the balance
• deposit that will be forfeited if the tenant defaults: this is essentially liquidated damages
• deposit that is denominated as advance rent: Not a true deposit, just an advance payment of rent that the tenant has the right to have attributed toward rent due at the end of the lease

Question 139

How does the death of either the landlord or the tenant affect a leasehold?

Answer 139

Usually it does not terminate the lease hold, BUT:

– the death of a tenant for years does not terminate the leasehold, instead the leasehold passes as personal property through the tenant’s estate.
– If the parties have agreed otherwise in the terms of the lease, then it can terminate on death
– tenancy at will: the tenancy IS terminated by the death of either party
– if the landlord has a life estate: the lease is void on the death of the landlord

Question 140

If a landlord sells property that has a tenant on it, how does the sale affect the leasehold?

Answer 140

There’s usually no effect on the tenant, unless the lease provides otherwise, except that the tenant now pays rent to the new landlord.
– If the lease says so, the buyer can terminate the lease. Otherwise the buyer steps into the shoes of the original landlord
– if the buyer purchased the property without notice (no constructive notice from recording and no inquiry notice from visiting the property) then his purchase is free of the lease and has a higher priority than the tenant has
– if the buyer knew about the lease, and purchased the property anyway, then he accepted the encumbrance and is bound by it

Question 141

What is the implied warranty of habitability?

Answer 141

When the landlord impliedly guarantees that he will deliver and maintain the premises in a safe, clean, and fit for human habitation condition.

Question 142

How do you prove that a landlord has breached the implied warranty of habitability?

Answer 142

• The tenant must show a defect in an essential residential facility. Majority says the defect can be patent or latent, but some jurisdictions do not include latent.
• The tenant must provide the landlord with notice of the defect, and
  – give the landlord a reasonable time to make repairs

Question 143

The implied warranty of habitability only applies to what?

Answer 143

Residential leases, not commercial leases

Question 144

If a landlord breaches the implied warranty of habitability, what does that do for the tenant?

Answer 144

– The tenant is excused from further performance
– the tenant may, but need not, vacate
– tenant can treat the lease as cancelled and it is abated
– tenant can get money damages through either the contract measure of damages: value of premises as warranted less value of premises as received, or difference between the rent agreed and the fair rental value of the premises received.
– Tenant can get reformation or traditional contract or tort remedies

Question 145

What is required in order for a breach of the covenant of quiet enjoyment to occur with regard to a lease?

Answer 145

Every lease expressly or impliedly has this covenant in it where the landlord promises the tenant will not be disturbed during his possession through either actual eviction or constructive eviction.

Question 146

If a landlord breaches the covenant of quiet enjoyment by actual eviction, what happens?

Answer 146

• Majority: The tenant is relieved of all liability to pay rent
• Second restatement: the tenant gets a rent abatement

Question 147

What happens when the covenant of quiet enjoyment has been breached through a constructive eviction of a tenant?

Answer 147

This happens if the landlord substantially and permanently interferes with the tenant’s use and enjoyment of the property, the tenant gives the landlord notice of the problem and a reasonable time to repair it, and the tenant moves out.

Things that could cause this would be the landlord withholding something essential to the full enjoyment of the property or something required by statute, such as heat or running water. Or from the landlord not disclosing latent defects that he knew about at the time the lease was made, not maintaining common areas, not using due care for promised or volunteered repairs, making fraudulent misrepresentations about the condition of the property, etc.

If this happens, the tenant is excused from further performance under the lease and rent is abated

Question 148

What is the key element to a tenant recovering for constructive eviction under the breach of covenant of quiet enjoyment?

Answer 148

The tenant must move out within a reasonable time because his argument is that the landlord or someone else interfered with the beneficial use and enjoyment of the premises in such a serious way that it amounted to an eviction

Question 149

What is the approach to an RAP essay?

Answer 149

– identify if the interest is subject to RAP
– identify the life/lives in being
- Determine whether the interest will vest or fail within 21 years of the life/lives
– treat the part of the gift that violated RAP as void, and leave the rest of the gift intact

Question 150

What are some interests that are not subject to RAP?

Answer 150

– Present possessory estates
– charitable trusts
– resulting trusts
– interests that are fully vested at creation including: reversionary interests, and completely vested remainders

Question 151

What are interests that are subject to RAP?

Answer 151

– Options to purchase land not incident to a lease
– powers of appointment
– rights of first refusal
– interests that are not fully vested at creation including: remainders subject to open, contingent remainders, and executory interests

Question 152

What is necessary to be a measuring life for RAP?

Answer 152

The person must in some way be connected to the vesting of the interest and identified by or through the documents, either expressly or impliedly

Question 153

What is the difference between an express life in being and an implied life in being for RAP?

Answer 153

• Express: the person is named in the document. “O conveys to A for life.“ O and A are express lives in being
  – Implied: person is not named in the document, but is implied from it. “To my grandchildren.“ The person’s children are implied lives in being

Question 154

What is the rule for determining whether an interest will vest or fail within 21 years of the life or lives under RAP?

Answer 154

The “might have been rule“ which says an interest violates RAP if there is any chance, however remote, that it might vest more than 21 years after a life in being.

Interests are scrutinized at the time of creation, which is the date the creating instrument takes effect.
– interest created in a deed: creation is the date the deed is delivered
– interest created in a will: creation is the date of the testator‘s death

Question 155

Analyze this hypothetical under RAP:

“To A as long as liquor is not served on the land, and if it is, then to B.“

Answer 155

Because the vesting of the future interest is unlimited, it’s not certain to vest or fail within 21 years of any life in being, so B’s shifting executory interest is void. That means that A is left with a fee simple determinable, and O has a possibility of reverter

Question 156

Analyze this fertile octogenarian scenario under RAP:

O conveys, “To A for life, remainder to A’s children for life, remainder to A’s grandchildren.“

Answer 156

STEP ONE: identify the interests.
- A’s life estate is presently possessory so it is NOT subject to RAP
– The remainder for life in A’s kids is either contingent or subject to open because he is presumed to be able to have more kids, so it IS subject to RAP
– the remainder in A’s grandkids is contingent or subject open, so it IS subject to RAP

STEP TWO: identify the lives in being
– O and A are express lives in being
– even if the kids or grandkids are already born, they are members of an open class so they cannot be lives in being

STEP THREE: figure out if the interest will vest or fail within 21 years of the lives in being
– A’s kids will take or not take at A’s death, so their interest is valid
– A’s grandkids could take more than 21 years after O and A die, so their interest violates RAP

STEP FOUR: treat the part of the gift that violates RAP as void, and leave the remainder of the gift intact
- A keeps her life estate
– A’s kids will take for life after A dies
– the interest in A’s grandkids is void, so O keeps a reversion that will become possessory after A’s kids die

Question 157

Analyze this unborn widow scenario under RAP:

O conveys ”To A for life, remainder to A’s widow for life, remainder to A’s children living at the death of A’s widow.“

Answer 157

Step one: identify the interests that are subject to RAP:
- A’s life estate is presently possessory, so it is not subject to RAP
– the remainder in A’s widow is contingent because there cannot be a widow of a living person, so it is subject to RAP
– the remainder in A’s kids that are living is contingent because of the condition precedent to vesting, so it is subject to RAP

Step two: identify the lives in being
– O and A are express lives in being
– A’s widow is not because she has not yet been identified
– A’s kids cannot be because their class is open

Step three: determine whether the interest will vest or fail within 21 years of the lives in being
- A’s widow will take or not take at A’s death, so her interest is valid
– A’s kids may take more than 21 years after O and A die, so their interest violates RAP

Step four: treat the part of the gift that violated RAP as void, and leave the rest of the gift intact
– A keeps his life estate
– A’s widow will take for life after A days if she survives A
– the interest to A’s kids is void, so O keeps a reversion, which will fall in when A’s widow dies

Question 158

What is involved in the charity to charity rule under RAP as evidenced by this scenario?

O conveys “To A charity for as long as liquor is not served on the premises, but if liquor is served, then to B charity.“

Answer 158

Normally a shifting executory interest in fee violates RAP, because an heir of A could violate the condition more than 21 years after the death of the lives in being.

But for public policy reasons, if both A and B are charities, the shifting executory interest in B charity will be deemed to be valid under RAP

Question 159

How does the uniform statutory rule against perpetuities work?

Answer 159

Some states have adopted this and it says that a non-vested interest in real or personal property is invalid unless:
– it satisfies the common law RAP, or
– it vests or terminates within 90 years of its creation (wait and see test). The court then waits until the end of that 90 year period to determine whether the interest actually vested or failed

Question 160

Analyze this conveyance under both common law RAP and Uniform Statutory RAP:

In 1990, O conveys “To A for life, remainder to A’s kids for life, remainder to A’s grandkids.“ At the time, A is 55 and has one kid, B who is 16. In 1995 B marries. In 2001 B has a child called C. A dies in 2004 at the age of 69. B dies in 2040 at the age of 66.

Answer 160

• CL RAP: The remainder to A’s grandkids is void

– USRAP: because C actually takes within 90 years of the conveyance, her interest is valid

Question 161

What are restraints on alienation?

Answer 161

Conditions placed on the ownership of real property that restrict free conveyance of the property

Question 162

What are the different restraints on alienation?

Answer 162

– Disabling restraints
– forfeiture restraints
– promissory restraints
– partial restraints

Question 163

What is a disabling restraint on alienation?

Answer 163

This prohibits a person from conveying property. These are always void.

Ie: O conveys land “To A and his heirs so long as they do not sell, mortgage, or transfer the property.“ This is void, so A and his heirs can freely sell, mortgage, and convey the property

Question 164

What is a forfeiture restraint on alienation?

Answer 164

When a person loses his estate if he attempts to convey the land. These are valid for life estates and future interests, but are not enforceable for fee simple estates.

Ie: O conveys land “To A and his heirs, but if he or his heirs ever convey to anyone, then to B and his heirs.“ This is a forfeiture of restraint on a fee simple estate, so it is not enforceable.

Ie: O conveys land “To A for life, then to B and her heirs if A ever sells or transfers the property.“ This is a forfeiture restraint and a life estate, so it is enforceable

Question 165

What is a promissory restraint?

Answer 165

When someone that gets land promises not to convey it. These are valid for life estates and future interests, but they are not enforceable for fee simple estates. This does not void the conveyance, it just makes the promisor liable for breach of contract damages

I.e.: O conveys land “To A for life, then to B and his heirs. A promises not to convey the property during his lifetime.“ This is valid because A has a life estate

Question 166

What does the fair housing act say?

Answer 166

People cannot refuse to sell/rent or discriminate in sales/rental terms to anyone based on: race, color, religion, sex, handicap, familial status/children, or national origin.

People cannot advertise the sale or rental of a building indicating discriminatory preferences

People cannot coerce, threaten, intimidate, or interfere with a person’s exercise of housing rights for discriminatory reasons, or retaliate against anyone that encourages the exercise of those rights

Religious organizations that provide housing for their members are exempt

Intent to violate the act is not needed for someone to prevail under it. The complainant just has to show a disparate impact on a protected group caused by the respondent’s actions. The burden then shifts to the respondent to prove that the practice is necessary to achieve a substantial non-discriminatory interest

Question 167

What are the different ways that the fair housing act can be enforced?

Answer 167

• through HUD (housing and urban development)
  – by filing a suit on behalf of the private person affected
  – through the United States attorney general

Question 168

How do you enforce a fair housing act violation through housing and urban development (HUD)?

Answer 168

• an aggrieved person must file a sworn complaint with the secretary of HUD within one year of a discriminatory housing practice occurring (or the secretary can file the complaint)
  – within 10 days of the complaint being filed, the secretary must notify the complainant and respondent, and the respondent has 10 days to file a sworn answer
  – the secretary must complete an investigation within 100 days
  – the secretary must encourage the parties to create a conciliation agreement
  – if the secretary, based on reasonable cause, believes that a discriminatory housing practice occurred, he must either issue a charge or dismiss the complaint
  – if a charge is issued: the complainant can select whether to have an administrative hearing or judicial trial
  – at the conclusion of either, if the complainant prevailed, equitable and legal remedies can be given including actual damages, statutory money penalties, attorney’s fees, and costs
  – the result of either a hearing or trial can be appealed through the federal court system

Question 169

How can a person enforce a violation of the fair housing act through a private suit?

Answer 169

• An aggrieved person can file suit in federal or state court within two years of a discriminatory housing practice occurring (and needn’t have already gone through HUD)
• if the person prevails in a civil action, they can get actual damages, punitive damages, legal and equitable relief attorney’s fees and costs

Question 170

How can the attorney general enforce the fair housing act?

Answer 170

If he has reasonable cause to believe that a person or group is engaged in a pattern of practice of housing discrimination, he can commence a civil action in federal court to enforce the fair housing act

Question 171

What do you do in applying choice of law with regard to property interests?

Answer 171

– The law of the situs of the property is what is usually applied for all rights in land and immovables. This refers to the whole law of the situs, including its choice of law rules
– validity and effective conveyance are governed by the law of the situs
– mortgages are thought to be so closely related to the land that they are governed by the law of the situs
– the underlying contract or note is usually governed by the law of the place of making because it is thought to be a contract issue (although the second restatement says it should be determined by the law of the situs)
– liens are governed by the law of the situs