Ownership Flashcards
FEE SIMPLE ABSOLUTE
Least restrictive present possessory interest
“To A & her heirs” or “to A”
Characteristics:
1)absolute ownership
2) potentially infinite duration
3) freely devisable – can pass via will
4) freely descendible - can pass via intestate succession
5) freely alienable (can pass inter vivos)
6) No future interest while owner alive.
DEFEASABLE FEES
Can be taken away
FEE SIMPLE DETERMINABLE so long as/ until/ during
automatically ends when state event occurs/does not
characteristics:
1) devisable subject to condition
2) descendible subject to condition
3) alienable subject to condition -AND cannot transfer greater interest than you have
4) future interest in GRANTOR = possibility of reverter
FEE SIMPLE SUBJECT TO CONDITION SUBSEQUENT
NOT automatically ends when event occurs, but GRANTOR right to TAKE BACK property if AFFIRMATIVELY EXERCISES that right.
Characteristics
1) devisable subject to condition subsequent
2) descendible subject to condition subsequent
3) alienable subject to condition subsequent
4) Future interest = Right of entry (power of terminator) in GRANTOR
FEE SIMPLE SUBJECT TO EXECUTORY LIMITATION
Estate to TP on happening of event *to A but if X occurs then to B”
VIOLATION/EVENT OCCURS? == to TP Automatically
Characteristic
1) devisable subject to condition subsequent
2) descendible subject to condition subsequent
3) alienable subjet to condition subsequent
4) future interest = shifting executory interest (held by TP that cuts off another’s interest)
COURT INTERPRETATION = GENERALLY DISFAVOUR THIS TYPE OF FEE
1) discourage restraint on alienation , law discourages restrains on alienation that effectively WITHDRAWS property from ordinary rules + channels
2) PRESUMPTION AGAINST FORFEITURES
3) Clear duration language REQUIRED for defeasible fee
– mere words of hope, intention, expectation NOT enough
ABSOLUTE RESTRAINT ON ALIENATION = VOID AND UNENFORCEABLE
LIFE ESTATE
Measure in lifetime (not years)
RIGHTS OF LIFE TENANT = ordinary use + profits of land
MUST NOT COMMIT WASTE = must not harm the future interest holders of land
AFFIRMATIVE WASTE -
1) structural change INTENTIONALLY made to estate, 2) causes HARM to it and/or DEPLETES resources
Rules re natural resources
1) prior use can continue to exploit land if was being used for exploitation prior to grant.
e.g. Open mines doctrine
2) Can consume natural resources for REASONABLE REPAIR AND MAINTENANCE of property
3) EXPRESSLY AUTHORISED BY GRANTOR
OR
4) NORMAL USE OF LAND
PERMISSIVE WASTE -
failure to maintain estate physically and financially.
life tenant duty - ONLY extent income/profits derived from the land.
physically- only to the extent of reasonable rental value of land.
DUTIES
1) obligation to keep in reasonable state of repair
extent of income/profits derived from land OR if
none reasonable rental value
extraordinary repairs = for remaindermen
2) obligation to pay interest on encumbrances
encumbrances = mortgages, must pay interest on mortgage etc.
3) Obligation to pay taxes
4) NO obligation to insure premises
AMELIORATIVE WASTE - unauthorised improvement, changes land physical character
PROHIBITED unless UNANIMOUS CONSENT from ALL future interest holders
FUTURE INTEREST = reversion or remainder (if assigned)
Reversion = to grantor
Remainder =TP
FUTURE INTERESTS - INTERESTS RETAINED BY GRANTOR
POSSIBILITY OF REVERTER
correlative present interest = fee simple determinable
Right of grantor = AUTOMATIC reversion
Transfer?
YES: devisable, descendible, alienable.
RIGHT OF ENTRY (POWER OF TERMINATION)
Correlative present interest = fee simple subject to condition subsequent
right of guarantor = NON AUTOMATIC reversion, must be exercised
Transfer?
YES: devisable, descendible
DOUBT over alienable.
REVERSION
interest that remains AfTER subtracting what grantor gave away + what now have.
Correlative present interest: Any estate of lesser quantum (life estate etc.) + NOT provide what happens when expires
Right of grantor = automatic reversion
Transfer?
YES, descendible, devisable, alienable
INTERESTS RETAINED BY GRANTEE: REMAINDER (GENERAL)
REMAINDER -
future interest created in GUARANTEE upon termination of PRIOR estate of known fixed duration.
General characteristics
1) created by express grant in same instrument where preceding possessory estate is created
2) MUST follow preceding estate (life estate, term of years)
3) Possessory ON natural expiration of predeeding state
4) CANNOT divest prior estates - any future interest = executory i.e. must wait until other interest ends
INTERESTS RETAINED BY GRANTEE: - VESTED REMAINDER
VESTED REMAINDER
1) created in ascertained person AND
2) not subject to condition precedent
INDEFEASIBLY VESTED REMAINDER
= To A for life, Remainder to B
Certain to become possessory, AND CANNOT be divested.
VESTED REMAINDER SUBJECT TO COMPLETE DEFEASANCE (aka vested remainder subject to total divestment)
1) Vested
2) NOT certain to be possessory bc condition subsequent or INHERENT LIMITATION
condition subsequent = e.g. to a for life, then to B but if B died under age 40 then to C.
inherent limitation = e.g. to A for life then to B for life, then to c + heirs
(B may not outlive A so not certain to be possessory)
VESTED REMAINDER SUBJECT TO OPEN
vested in class of persons, at least 1 of whom QUALIFIED to take possession BUT not yet fixed because more members can join.
e.g. To A for life, then to children of B and their heirs
CLASS CLOSING RULE (rule of convenience) class closes when any member of classs can demand possession
EXCEPTION = WOMB RULE , if in class and in womb at time becomes possessory = considered members of class and share in possession.
INTERESTS RETAINED BY GRANTEE: CONTINGENT REMAINDER
CREATED IN 1) unascertainable person OR 2) subject to a condition precedent (other than natural termination)
1) unascertainable person
- heir of living person - living person CANNOT have heirs
2) SUBJECT to a condition precedent
act/event must exist/occur before vests.
FAILURE of condition precedent ? REVERSION TO GRANTOR
SATISFACTION of condition precedent? indefeasible remainder i.e. vests.
DESTRUCTABILITY
1) Common law - Contingent remainder as destroyed if it did not vest at/before termination of preceding estate
2) modern law- abolished destructibility. holds in trust subject to b SPRINGING EXECUTORY INTEREST once condition satisifed
2 RULES OF CONSTRUCTION (SHELLEY + WORTHIER TITLE), both fail in face of expressed intent to contary.
RULE IN SHELLEY’S CASE- to b for life then to b’s heirs + b is alive
Common law = Doctrine of merger -
1) shelley’s rule converted contingent remainder in B heirs into vested remainder in b AND
2) doctrine of merger converted it into fee simple absolute in B.
MODERN - ABOLISH SHELLEY’S RULE - could be against intention.
DOCTRINE OF WORTHIER TITLE - to b for life, then to O’s heirs & O is alive
– creates reminder in heirs of grantor who is alive - that = void
AIM? PROMOTE TRANSFERABILITY
Future interests- EXECUTORY INTEREST
future interest that MUST divest or cut short a prior estate (shifting) or spring out of grantor (springing) at future date.
REMAINDER almost NEVER divests, an EXECUTORY interest almost ALWAYS does.
SHIFTING EXECUTORY INTEREST - cuts short a defeasible fee in another grantee.
e.g. to A and her heirs but if B returns from rome, to B and her heirs.
SPRINGING EXECUTORY INTEREST- divests THE GUARANTOR.
springs out, from the guarantor, on completion of a certain event
e.g. O conveys to A and her heirs when/if A marries.
interest springs out of O when A gets married.
RAP
RULE: Future interest MUST vest, if at all, within 21 YEARS after some life in being at instrument’s effective date.
Measuring life =
1) natural person alive when interest created
2) is identifiable AND
3) somehow connected to vesting/failing of interest
RAP NOT APPLY TO
1) Vested remainders
2) vested remainders subject to complete defeasance
future interests retained by guarantor
Only applies to :
1) CONTINGENT REMAINDER- vesting = when identification of taker + satisfaction of conditions precedent
2) EXECUTORY INTEREST
- vesting = taking of possession
VALID = to A so long as land is used for residential purposes ( bc reversion in grantor)
INVAID = to A so long as uses land for residential purposes, remainder to B ( no limit on time when would vest so invalid)
3) VESTED REMAINDER SUBJECT TO OPEN
vesting? closing of the class
a gift to open class requiring the members to survive pass 21 = void
ALL OR NOTHING RULE - if any class members interest may vest beyond 21 years after measuring life- ALL class member interest = void.
WHAT MIGHT HAPPEN/ LOGIC
1) fertile octogenarian rule (presumes everyone can parent a child regardless of gender/health)
2) unborn widow (grantor could marry person not a life n being at time interest created)
3) slothful executor (for rules “living at time of my death” presumes executor not probate for years after death)
4) precocious toddler - possible for a toddler to have a child.
CHARITABLE EXCEPTION
1) OK for charitable grant to e made in perpetuity
2) RAP NOT apply to conveyances from one charity to another
MODERN RAP
WAIT AND SEE
adopted by some states.
wait and see if interest vests in perpetuity period (21 years), invalidates it if it does not.
UNIFORM STATUTORY RAP
1) common law valid - if meet common law rap = valid
2) 90 years- future interests that ACTUALLY vest within 90 years are valid.
3) Cy Pres doctrine - future interest fails to vest in 21 years of measuring life or 9- uear period, can REFORM it in way MOST CLOSELY CONFORMS W grantors intent and still complies w RAP.
CONCURRENT ESTATES : JOINT TENANCY W RIGHT OF SURVIVORSHIP
characteristics:
1) right of survivorship
2) transferability: devisable NO; descendible NO; alienable: YES.
CREATION
1) 4 UNITIES - time, title, interest, AND possession
2) express language of right of survivorship
3) straw man conveyance - convey to someone else then back to themselves to have unity of title
SEVERANCE
1) by voluntary agreement
2) court ordered division (partition in kind - if cannot agree, makes in best interest of all parties; Partition by forced sale- cannot voluntary agree can force sale)
3) inter vivos conveyance - joint tenant can sell / transfer WITHOUT knowledge/consent other JTs severing joint tenancy
– buyer = tenant in common
– contract to sell = severs JT at time of contract (equitable conversion)
4) Mortgages- depends on jurisdiction
– Lien theory jurisdiction = mortgage NOT sever JT
– Title theory jurisdiction = mortgage does sever
5) FORCED SALE = severs
– judgment liens- not sever until sold at foreclosure sale
– foreclosed mortgages – not sever JT, even in title jurisdiction if mortgage later foreclosed + property sold then severed.
6) Lease by JT
– common law = severs JT
– modern law = Does not sever JT
7) Murder of one JT by another - murderer not entitled to benefit from other JT.
TENANCY BY ENTIRETY
H+W with right of survivorship
creation
1) marriage
2) 4 unities required - time, title, interest, possession
3) right of survivorship
SEVERANCE
1) divorce
2) mutual written agreement between spouses
– unilateral conveyance = NO severance
3) execution by joint creditor
– unilateral creditor (of only 1 spouse) NO SEVERANCE
Tenancy in common
PRESUMED in modern law
ONLY POSSESSION UNITY required
NO RIGHT OF SURVIVORSHIP
DUTIES OF CO-TENANTS (OF ALL TYPES)
POSSESSION
1) right to possess and enjoy entire property
2) Wrongful exclusion - outer of co-tenant, AP requires ouster
3) rents from co-tenant
exclusive possession - if one has exclusive possession, co-tenant not entitled to rent unless ouster
wrongful exclusion - ouster of tenant DOES entitle that tenant to rent
PROFITS FROM NON-TENANT - EACH entitled to share of profits
CARRYING COSTS AND REPAIRS
1) taxes - must pay fair share, in proportion to ownership
2) mortgage - must pay fair shaire
3) repair - co-tenant right to contribution for any repairs: reasonable necessary and have been communicated
IMPROVEMENTS
* NO RIGHT TO CONTRIBUTION* except on partition of co-tenancy
– partition = co-tenant entitled to any increase in value cause by improvements BUT also liable for any decrease in value
DUTY NOT TO COMMIT WASTE - co-tenant can bring action for waste
1) Affirmative waste (voluntary)
2) permissive waste
3) Ameliorative waste
RIGHT TO BRING ACTION FOR PARTITION
Conflict of Law
intervivos conveyance of RP = law where property is
transfers of RP by will or intestate succession = law of situs
contract for transfers of interest in land = law of situs
