Property Flashcards
Equitable conversion
as soon as the contract is signed (but before closing)the
buyer’s interest is → equitable title/real property (the land he contracted to buy)
seller’s interest is → legal title/personal property (money he will get from the sale).
Risk of Loss under equitable conversion,
The risk of loss remains on the buyer even if the seller remains in possession and control of the land the
A deed must be
LEAD: lawfully executed and delivered.
To be valid execution, a deed must:
- identify the buyer and the seller,
- describe the land,
- contain words denoting a present intent to convey, and
- be signed by the grantor.
Delivery of Deed
is a question of intent to pass title presently.
Quitclaim Deed
The grantor gives no covenants (promises nothing) and the grantee gets whatever the grantor has. The grantee takes the land subject to a defect in the title, an undisclosed easement, or other problem, and has no recourse.
Warranty Deed
The grantor gives six covenants—three present covenants and three future covenants.
Future Covenants in a Warranty Deed
- Future Assurances
- Quiet Enjoyment
- Warranty Deed
Present Covenants in a Warranty Deed
- Seisen: I own
- Right to Convey
- No encumbrances: (i.e., there are no existing easements, liens, or encumbrances that are not stated in the deed)
Under common law, remote grantees can sue under only:
future (not present) covenants. However, note in your answer that some jurisdictions do not follow the common law rule.
Merger
on the closing date, the contract for sale merges into the deed, so at that point, the buyer can only sue on the deed.
Breach of the implied warranty of fitness and habitability:
A builder of new homes impliedly warrants to the buyer that the home is habitable and fit for its intended purposes. This warranty applies to defects that are discovered within a reasonable time and are due to the builder’s negligence or failure to do work in a workmanlike manner.
Common Law Rule before Notice Statutes
Under common law, a grantor can convey only those rights that the grantor had at the time of the conveyance. Thus, common law follows the first-in-time first-in-right principle.
Notice Statute
protect subsequent bona fide purchasers for value who take without notice of the earlier transaction. (E.g., “A conveyance of interest in land is not valid against any subsequent purchaser for value without notice unless it is recorded.”)
Last BFP takes!
Race Notice Statute
protect subsequent bona fide purchasers for value who take without notice and are the first to record. (E.g., “No conveyance of an interest in land is valid against any subsequent purchaser for value without notice unless it is first recorded.”)
First BFP takes!
Race Statue
protect subsequent purchasers who are first to record. (These are rare!)
Actual notice:
the grantee actually knows about the conveyance.
Inquiry notice:
examination of the land or reference in an instrument would lead a reasonable person to inquire.
Record Notice
The interest is recorded in the chain of title. Deeds that are recorded too late or too early are wild deeds. Wild deeds do not give notice.
Mortgagor’s Right to Transfer
A mortgagor (homeowner) can transfer title to the property. However, the mortgage will remain on the property and the mortgagor is still personally liable on the note.
Transferee who takes the land “subject to” the mortgage
not personally liable, the mortgagor is liable.
Transferee “assumes” the mortgage:
he is personally liable along with the original mortgagor
Novation
occurs if the initial mortgagor, the new transferee, and the mortgagee all agree that the mortgagor is no longer liable and the transferee assumes all of the mortgagor’s duties
Term for years lease:
a term for years lease specifies both a beginning date and an end date.
Periodic tenancy:
A periodic tenancy has no fixed end date (e.g., month-to-month lease = periodic tenancy).
- It simply repeats until one party gives valid notice to the other. It can be created by an express agreement, implication (where the lease contains no end date), or operation of law (e.g., an oral leasethat violates the Statute of Frauds because the term is more than one year).
- Valid notice (i.e., notice equal to the rent payment term) is required to terminate a periodic tenancy.
Assignment
if the lease does not prohibit an assignment or sublease, a tenant can assign or sublease her interest in the lease.
Constructive eviction
A tenant can sue for constructive eviction (commercial or residential) if the tenant can prove that:
- the landlord breached a duty to the tenant (e.g., the duty to repair) and
- this breach caused a loss of substantial use and enjoyment of the premises, and
- the tenant vacated the premises within a reasonable time after giving the landlord adequate notice.
Implied Warranty of Habitability
breached only in a residential lease if the premises are uninhabitable.
If this occurs, the tenant has several remedies including vacating the premises, suing for damages, offsetting damages, etc.
Duty of a Tenant
The tenant must pay rent. If the tenant does not pay rent but has abandoned the property, the landlord can sue the tenant for damages or treat it as a surrender (the latter excuses future rent obligations). (Sept 2020, Feb 2017, Feb 2013)
Duty to mitigate:
Under common law, the landlord has no duty to mitigate damages. Many states have abandoned this approach and require that the landlord make a reasonable effort to mitigate damages (e.g., by attempting to re-rent the premises if the tenant leaves).
The Fair Housing Act:
This act disallows discrimination in housing sales or rentals on the basis of race, color, religion, sex, familial status, or national origin (but not occupation). This does not apply if the owner occupies one of the units in a multiple-unit dwelling containing no more than four units occupied by persons “living independently of each other.” However, an owner may not place a discriminatory advertisement. If such advertisement is made, the owner and publisher will have violated the act
Creation of Easement
easements can be created expressly, impliedly (by prior use or necessity), or by prescription.
Termination of Easement
Easements may be terminated in a variety of ways such as by their
- express terms,
- written release,
- merger of the dominant and servient tenements,
- prescription,
- estoppel,
- condemnation, or
- abandonment.: mere nonuse of the easement is not sufficient to abandon it. There must be an act of abandonment
Creation of a Joint Tenancy
TTIP
- Time
- Title
- Interest
- Possession
Most states also require using the language “joint tenancy” and adding an express reference to “survivorship” or “survivors” to create a joint tenancy.
Severance of a Joint Tenancy
(mnemonic=G SAM):
- by giving it away during life,
- by signing a contract for sale,
- by an actual judicial sale by a judgment lien creditor, or
- by granting a mortgage in a title theory state.
Adverse Possession
Requirements for adverse possession include possession that’s (mnemonic=COAH)
- continuous for the statutory period
- open and notorious,
- actual and exclusive
- Hostile
One only acquires title to the area one actually possesses (unless there is color of title, a unitary tract, and possession of an amount that is reasonable in relation to the hole—in which case, the adverse possessor can acquire the whole tract).
Taking Under Adverse Possession
in some circumstances, an adverse possessor may tack on the time that a prior adverse possessor had possessed the land to his own time to reach the statutory period.
Failure to record an interest acquired by adverse possession:
the adverse possessor will prevail over a subsequent bona fide purchaser who complies with the recording act because there is no document that the interest holder could record.
