MC Flashcards
Examples of political, nonjusticiable questions (because they’re committed by the Constitution to a different branch of government)
Political questions:
- Deployment of troops
- recognition of foreign governments
- Impeaching president or other federal officials
- Racial gerrymandering is justiciable, but partisan gerrymandering is considered a political question
Congress’s ability to regulate for general welfare
Congress is NOT allowed to create legislation “for general welfare”
But they have broad power to spend $$ for general welfare
Encumbrances?
Define & give examples
An encumbrance is a right or interest that exists in someone other than the owner of real property that restricts or impairs the transfer of property
Ex: mortgage/liens are encumbrances but if they’re paid off by closing (seller can use purchase price to pay off), then title is marketable
Ex: easements, covenants, purchase options
All protections of the Constitution apply to the states through the 14th Amendment EXCEPT for what limited exceptions?
(1) requirement to quarter/house soldiers
(2) requirement of a grand jury indictment for a criminal charge
(3) right to jury trial for a civil matter
A sold land to B (who has title insurance), who sold land to C, who sold land to D (the current owner) with quitclaim deed.
D then discovered outstanding mortgage that predated all previous conveyances. Who can D sue?
D can sue B. And B can recover from title insurance company, even though B no longer owes the land.
If D sued insurance company directly, D would not get anything
Builder of new house sold to Buyer. Buyer sold to Woman. Woman found latent defects. If Woman sues successfully, who does she sue and why does she succeed?
Woman can sue the Builder and if she’s successful, it means they were in a jurisdiction where the implied warranty of habitability/fitness/quality of new home construction is enforceable by a subsequent purchaser
Equitable conversion
(When does buyer become the owner vs. when does buyer get actual legal title)
This is about liability during the period between contract and closing.
When contract is signed, buyer is deemed the owner but seller still has “legal title.”
Legal title only transfer from seller to buyer at closing
Risk of loss
(equitable conversion - maj rule)
(uniform vendor and purchaser act - min rule)
“no applicable statute” = maj rule applies
MAJ RULE:
if property damaged prior to closing, risk of loss is imposed on the buyer. Buyer would have to cover any losses + pay purchase price to seller
Exceptions (aka when seller bears loss):
- it’s a NEW CONSTRUCTION: the constructor would be required to rebuild the whole thing
- if loss is caused by seller’s own negligence
- if at the time of loss, title was unmarketable
MIN RULE:
- places risk of loss on seller
Deed
definition and validity requirements
Document that serves to pass legal title from grantor to grantee when it is (1) lawfully executed and (2) properly delivered
Requirements:
- identification of the parties (cannot be “leaders of all churches in York County” which is too broad)
- in writing and signed by grantor. grantee need not sign
- words of present / actual intent
- adequate land description
- proper delivery (1.g. recording, physical delivery, third party delivery)
Delivery of deed and revocability
If grantor physically hands deed to grantee, title passes immediately to grantee and is not revocable.
- Doesn’t matter if grantor later asks grantee to destroy the deed.
- Or requests to delay the recording
- Handing deed back / tearing it up does not undo the conveyance of property through the deed
Consequences of defective deed to future BFP
Void/defective deed will be set aside even if transferred to a BFP.
- Void deed»_space; no BFP protection
Voidable deed will be set aside unless transferred to BFP.
- Voidable deed»_space; BFP protection
Estoppel by deed
AKA after-accquired title
If someone purports to convey an interest in real property that they don’t own at the time, but subsequently obtains title to the property, the property will automatically pass to the grantee once the grantor acquires title
Estoppel by deed only applies to transfer by warranty deed, not quitclaim deed
Ademption
When a testator devised property to a specific person in their will, but the property is no longer part of the estate at the time of testator’s death
Exoneration
When a person receives a bequest, and the property is subject to lien or mortgage, then the encumbrance will be paid off with estate’s personal property so that the recipient receives title free and clear of mortgage
Lapse & anti-lapse
Lapse occurs when the beneficiary named in a will ends up dying before the testator, and thus the bequest fails
Anti-lapse statutes allow the predeceased beneficiary’s heirs to receive the bequest
Wild deeds
Deed that is recorded outside the chain of title. Does NOT provide constructive notice because BFP wouldn’t be able to find it. .
Ex: Owner sells lot to Doctor. Doc does not record. Doc then sells to Surgeon and Surgeon records. Owner subsequently grants to Architect. Architect does not constructive notice
New owner’s responsibility over mortgaged property: “subject to” versus “assumed mortgage”
Sale (or gift) “subject to” the mortgage
- Buyer is NOT personally liable for paying mortgage.
- Buyer is NOT personally liable for any deficiency in the case of a foreclosure
Assumption of mortgage
- Buyer agrees to be personally liable to original mortgagor/mortgagee for repayment of loan.
- Includes any deficiency if there’s a foreclosure
- original mortgagor still “secondarily liable” to the lender as a surety, unless there’s a “release of liability” from the lender
Due on sale clause
This requires a property owner who transfers ownership of the property to pay the ENTIRE loan balance to mortgagee in full.
aka loan cannot be “assumed” to a new owner
due on sale clauses ARE reasonable and enforceable (if you see “unreasonable restraint on alienation” as an ac, that’s wrong)
Lien Theory vs Title Theory for mortgages
and what it means for possession before foreclosure
Lien Theory (maj rule)
- Mortgagee / lender holds security interest only. Thus, they may not take possession before foreclosure
Title Theory (minority rule)
- Mortgagee/lender MAY take possession before foreclosure because mortgagee actually holds title until the loan has been paid or foreclosed.
Intermediate Theory
- upon default, legal title shifts to mortgagee/lender who can demand possession
Equitable redemption
(and the right to redeem)
Meaning the mortgagor is allowed to pay off the entire mortgage before the foreclosure
This right to redeem cannot be waived. “Clogging the equity of redemption” is not allowed
Statutory redemption
Some states allow this, which gives mortgagor opportunity for a fixed period after foreclosure (usually 6 months to 1 year) to “redeem” and pay off the amount due on mortgage
Joint tenancy
definition, creation, key features
When 2 or more people hold a single, unified interest in a property
Features:
- automatic right to survivorship
- equal right to posses whole property
- each JT owns property in equal shares
- any JT can unilaterally sever
Judgment lien does not sever joint tenancy.
What happens to the lien interest when the tenant that has the lien dies?
When the JT that has the lien against the dies, their interest evaporates and the judgment lien holder no longer attaches the property
But if the judgment lien is enforced by foreclosure, then the JT will be severed. Then property will be owned half to the judicial sale buyer and half to the original JT, as tenants in common
Accounting between co-tenants
Co-tenants have duty to pay their proportionate share of “carrying costs” (e.g. taxes and mortgage payments. Also required to pay for necessary repairs
Co-tenants have NO duty to improve the property
Profits from rents and profits from land depletion must be shared