Property Flashcards
Does one JT’s execution of a mortgage bind the other JT (who did not sign) upon the signer’s death?
Under the (majority) lien theory, a mortgage does not trigger a severance -> thus, the surviving JT who did not sign the mortgage receives full title free and clear of the mortgage.
Under the (minority) title theory, a mortgage creates a severance of the JT, creating a TIC. Thus the surviving partner would keep one-half, free of the mortgage they did not sign, and the heirs of the JT who signed the mortgage would inherit one-half, subject to the mortgage .
What are T’s obligations when they are partially evicted?
Even though the tenant continues in possession of the remainder of the premises, partial eviction by the LL relieves the tenant of the obligation to pay rent for the entire premises.
In contrast, partial eviction by a paramount title holder results in an apportionment of rent; i.e., it relieves the tenant of the obligation to pay rent NOT for the entire premises, but only for the portion of the premises from which he was evicted. The tenant remains liable for the reasonable rental value of the portion that he continues to possess.
Does the covenant of quiet enjoyment apply to conduct of a third-party?
No. It only applies where the LL’s conduct has rendered the property uninhabitable
If the buyer of land determines that the seller’s title is unmarketable, what can the buyer do?
The buyer must notify the seller and give her reasonable time to cure, even if this requires extending the closing date, and even if time is of the essence. If the seller fails to cure the defects, then the buyer may rescind the contract, sue for damages for breach, get specific performance with abatement of the purchase price, or (in some jurisdictions) require the seller to quiet title
Does an easement render title unmarketable?
Easements are generally considered encumbrances that render title unmarketable. BUT, a beneficial easement that was visible or known to the buyer does not constitute an encumbrance
Does a de minimus zoning violation render title unmarketable?
Yes, unless the title holder is able to get the zoning authority to grant a permanent variance
If a property is possessed by a life estate, with a remainder held in another party, will an adverse possessor obtain title to the land?
No. The adverse possessor will get possession of the life estate, but will be ejected by the remainder holder once the former life estate holder dies.
What is color of title?
Color of title is a document that purports to give title, but for reasons not apparent from its face does not
When does the true owner’s disability (infancy, insanity, imprisonment) toll the statute of limitations on an adverse possession claim?
For a disability, such as status as a minor, to stop the clock, the disability must have been in existence on the day the adverse possession began
If a party assumes a mortgage from the original mortgagor, who can the mortgagee go after should there be a default?
When a grantee assumes the mortgage, the grantee expressly promises the grantor-mortgagor that he will pay the mortgage obligation as it becomes due. The mortgagee then becomes a third-party beneficiary of the grantee’s promise to pay and can sue the grantee directly if the grantee fails to pay. After the assumption, the grantor-mortgagor becomes a surety who is secondarily liable to the mortgagee on the note if the grantee fails to pay. The grantee and the original mortgagor are jointly liable, even though the grantee is primarily liable and the original mortgagor is secondarily liable as a surety
If a mortgagee and an assuming grantee subsequently modify the original obligation, can the original mortgagor be held liable for any part of the original obligation?
No. When a mortgagee and an assuming grantee subsequently modify the original obligation, the original mortgagor is completely discharged of liability
What happens when a grantor purports to convey property that he does not own, but subsequently acquires title?
When a grantor purports to convey property that he does not own, his subsequent acquisition of title to that property vests in the grantee under the doctrine of estoppel by deed. Most courts, however, hold that this is personal estoppel, which means that title inures to the grantee’s benefit only as against the grantor, not a subsequent bona fide purchaser. If the grantor transfers his after-acquired title to an innocent purchaser for value, the bona fide purchaser gets good title
What are the six warranties that protect purchasers of property against defects in title?
Present covenants: seisin, right to convey, and freedom from encumbrances
Future covenants: warranty, quiet enjoyment, and future assurances
covenant of seisin
in which the grantor covenants that they have title and possession to the estate they are purporting to convey.
covenant of right to convey
in which the grantor covenants that they have the authority to make the grant (which is satisfied by their title)
covenant against encumbrances
in which the grantor covenants against the existence of any physical (e.g., encroachments) or title (e.g., mortgage) encumbrances.
covenant for quiet enjoyment
whereby the grantor covenants that the grantee will not be disturbed in possession by any third party’s lawful claim of title
covenant of warranty
where the grantor agrees to defend against any reasonable third party claims of title and to compensate the grantee for any loss they incur from claims of superior title.
covenant for further assurances
whereby the grantor promises to perform acts that are reasonably necessary to perfect the conveyed title.
What is the implied warranty of habitability?
The implied warranty of habitability is a warranty recognized in Pennsylvania between the builder-vendor of a residence and the (original) purchaser-resident in which the builder-vendor bear the risk that a home which he has built will be functional and habitable.
What are the requirements to validly convey a deed?
The only requirements that must be met for a conveyance of land to be valid (and thereby transfer legal title in that land from one party to another) are execution and delivery of the deed. The execution requirement is satisfied as long as the deed is signed by the party to be charged (the seller or transferor). Delivery of a deed is established by a proven intent to pass title, even if the title document was never physically given to the grantee. The grantee’s acceptance of the deed will be presumed (by the deed’s recording), unless the grantee explicitly rejects it.
What must a valid deed contain?
A valid deed must satisfy the Statute of Frauds and include all the necessary terms: the identity of the grantor and grantee, words of transfer, a description of the property interest being transferred, and the grantor’s signature.
If a party is granted a life estate on a property that is mortgaged, is the life estate holder responsible for the mortgage payments?
whenever the life estate and future interest are split, the law has evolved to require the life estate holder to pay interest on a mortgage (otherwise the life estate holder is committing permissive waste) and to require the remaindermen to pay the principal due on the mortgage
What constitutes permissive waste?
Permissive waste is a failure to perform obligations related to the land to keep the property in good repair or maintain its value. A failure to make repairs to buildings on the property, failure to pay taxes on the property as they come due, or failure to pay the interest on the mortgage on the property all constitute permissive waste
What is an easement by necessity?
An easement by necessity is created when the owner of a tract of land sells a part of the tract and by this division deprives one lot of access to a public road or utility line. When this happens, a right-of-way absolute necessity is created by implied grant over the lot with access to the public road or utility line.
If a person was granted title as a gift, rather than through a sale, can they claim to be a bona fide purchaser of value for the purposes of a recording statute?
No - the common law “first in time, first in right” rule applies
Can a seller deliver marketable title if they acquired the property through adverse possession?
Only if they have obtained a judicial determination that they have acquired title to the land.
When will courts uphold a liquidated damages clause in a real estate contract?
Yes, if they are a good-faith attempt by both parties to reasonably approximate a fair amount for compensation to the non-breaching party. Courts have upheld the retention of a deposit of up to 10% of the sale price. A liquidated damages clause will not be upheld if it is deemed to be a penalty or unconscionable.
How does a court determine whether something is a fixture?
A fixture is a chattel that has been so affixed to land that it has ceased being personal property and has become part of the realty. Fixtures are typically a permanent part of realty such that damage would occur if they were removed. A court will consider the degree to which the item is attached, whether there will be damage to the structure if the item is removed, and whether general custom dictates that such an item stays with a property or goes out with the seller.
When is an equitable servitude enforceable against subsequent grantees?
An equitable servitude in a deed is only enforceable where a party can establish (i) intent that the restriction be enforceable by subsequent grantees; (ii) that the subsequent grantee had notice of the servitude; and (iii) that the restriction touches and concerns the land. Privity, notably, is not required.
What is the standard for restrictions imposed by a common-interest development’s declaration?
Restrictions in the declaration (i.e., the recorded document that imposes the covenants and easements creating a common-interest ownership community) are valid unless illegal, unconstitutional, or against public policy.
What is the standard for regulation imposed by a common-interest development’s HOA, but not in their declaration?
Reasonableness
Can you put a direct restraint on alienation of a fee simple?
Direct restraints on alienation of a fee simple are void. E.g., “Blackacre to A, but if A tries to sell Blackacre, to B” is void and instead is read as “Blackacre to A”
When is a partition appropriate?
When the parties cannot agree on the appropriate use of the land
When can the landlord raise the rent on a holdover tenant?
When they announce their intention to raise the rent before the original lease expires
When can restrictive covenants on subdivision lots be voided under the doctrine of changed neighborhood conditions?
Restrictive covenants on all lots in a subdivision such as this can be voided if changed conditions have made the property unusable for the specified use, and this means that the entire subdivision must have changed so significantly that enforcement of the restriction would be inequitable. If some houses in the center of the subdivision are not affected by the pollution, then none of the restrictions can be voided; if all lots are affected, then all restrictions are voided
When is a landowner liable for damage to adjacent buildings due to the landowner’s excavations?
A landowner has a right to have his land supported in its natural state by adjoining land. If, however, the land has buildings on it, an excavating adjacent landowner is strictly liable for damage to the buildings caused by the excavation only if the excavation would have caused the land to subside even in its natural state (i.e., without buildings). Even if the land would not have subsided in its natural state, the excavating landowner is liable for the damages if she was negligent.
Are absolute restraints on fee simple estates allowed?
No, all absolute restraints on fee simple estates are void. Partial restraints (limited in time, people and purposes) may be upheld.
What are the four unities for a joint tenancy?
Time, Title, Interest and Possession
What happens when a buyer realizes that the property is unmarketable prior to closing?
If the buyer determines, prior to closing, that the seller’s title is unmarketable, he must notify the seller and allow a reasonable time to cure the defect. If the seller is unable to acquire title before closing, so that title remains unmarketable, the buyer can rescind, sue for damages caused by the breach, or obtain specific performance with an abatement of the purchase price. However, the buyer cannot rescind prior to closing on grounds that the seller’s title is unmarketable.
When does a purchase money mortgage have priority over other claims?
A PMM, whether recorded or not, has priority over mortgages, liens, and other claims against the mortgagor that arise prior to the mortgagor’s acquisition of title. However, PMM priority is subject to being defeated by subsequent mortgages or liens by operation of the recording acts
