Property Flashcards
What is a fee simple absolute?
The least restrictive present possessory interest
Present possessory interests are also known as _______.
Freeholds
What is the language of a fee simple absolute?
“To A & her heirs” or “to A”
Fee simple absolute grants _____ ownership
Absolute
How long is the duration of the rights granted via fee simple absolute?
Potentially indefinite
Rights granted by fee simple absolute are freely:
- Devisable
- Descendible
- Alienable
What does it mean for ownership to be freely devisable?
Owner is free to pass interest via will
What does it mean for ownership to be free descendible?
Owner’s interest passes via intestate succession if the owner dies without a will
What does it mean for ownership to be freely alienable?
Owner’s interest is transferable inter vivos
Inter vivos means _______.
During the owner’s lifetime
Is there future interest when rights are granted via fee simple absolute?
No; owner’s have nothing while owner is alive
What is the language of fee tail rights?
To A & the heirs of her body
Any attempt to create a fee tail creates _______.
A fee simple absolute
Where there are defeasible fees, interest in land has the possibility of ________.
Being taken away
What is a fee simple determinable?
Fee simple which automatically comes to an end upon a stated event
What language must a grantor use for a fee simple determinable?
Clear durational language:
“to A so long as”
“to A until”
“to A during”
“to A provided that”
etc.
Once a named event in a fee simple determinable occurs, then _________.
it automatically reverts to grantor
How is a fee simple determinable devisable?
Subject to condition
How is a fee simple determinable descendible?
Subject to condition
What is the nemo dat rule?
A person cannot assign a greater interest than the interest which is possessed
A fee simple determinable is alienable subject to _______
Condition
The future interest in fee simple determinable maintains the possibility of _______.
Reverter
What is a fee simple subject to condition subsequent?
Rather than automatically ending when an event occurs, Grantor must affirmatively exercise the right to take back property
What language is required for a fee simple subject to condition subsequent?
Clear durational language that expressly reserves the right to re-enter
“to A, but if X occurs, grantor shall have a right of entry”
“to A upon the condition that X, grantor shall have a right of entry.”
What future interest exists in a fee simple subject to condition subsequent?
Right of entry
What is a fee simple subject to executory limitation?
Provides for the estate to pass to a third person upon the happening of the state event
What language should be used for a fee simple subject to executory limitation?
“To A but if X occurs, then to B”
What is the effect of violating a fee simple subject to executory limitation?
Automatically passes to third party
What future interest exists for a fee simple subject to executory limitation?
Shifting executory interest (future interest, held by a 3rd person, that cuts off another’s interest)
Generally, defeasible fees are ______ by the court
Disfavored
Courts disfavor defeasible fees because courts tend to discourage ________
Restraints on alienation
Courts disfavor defeasible fees because there is a presumption against ________.
Forfeitures
To have a defeasible fee, _________ language is required
Clear durational language
A ________ restraint on alienation of a fee simple estate is void and unenforceable. It results in ________.
Absolute
Fee simple absolute to grantee
What is a life estate?
Lifetime ownership of land
Ownership of a life estate must be measured in terms of ______, not ______.
Lifetime
Years
“To A for life” describes what kind of life estate?
Simple life estate
“To A for B’s life” describes what kind of life estate?
Pur autre vie
What rights does a life tenant have in a life estate?
All ordinary uses and profits of the land
In a life estate, a life tenant has a duty ______________.
Not to harm the future interest holders of the land
In terms of a life tenant’s duty not to harm future interest, what is affirmative waste?
Any structural change intentionally made to the estate that causes harm to the estate or depletes its resources
Under a life estate, a life tenant has a duty not to consume or exploit natural resources unless:
- Prior to the grant, land was used for exploitation
- Reasonable repairs and maintenance
- Expressly authorized by grantor OR
- Normal use of the land
What is the open mines doctrine?
Permits continued excavation by a life tenant from any mine on the property that is already open, but prohibits opening new mines
In terms of a life tenant’s duty not to harm future interest, what is permissive waste?
Failure to maintain the estate, both physically and financially
A life tenant must maintain an estate only to the extent _____________.
Of the income or profits derived from the land
If a life tenant is using the land herself with no rent, then the life tenant must maintain the estate only to the extent ___________.
Of the reasonable rental value of the land
What is a life tenant’s obligation to repair?
Life tenant must keep the property in a reasonable state of repair
A life tenant has an obligation to pay interest on __________.
Encumbrances, to the extent of the income or profits derived from the land.
In a life estate, who must pay taxes on the land?
Life tenant
A life tenant has no obligation to insure _______.
The premises
In terms of a life tenant’s duty not to harm future interest, what is ameliorative waste?
Unauthorized improvement to the estate that changes the land’s physical character
In terms of a life estate, ameliorative waste is prohibited unless ____________.
All future interest holders consent
What future interest exists for life estates?
Reverts to grantor unless assigned to third party remainder.
In a life estate, a third party remainder is responsible for:
- Principal portion of mortgage payments
- Extraordinary repairs
Possibility of reverter correlates to the present interest of _________
Fee simple determinable
What is the right of the grantor when there is possibility of reverter?
Estate automatically reverts to grantor upon occurrence of stated event
Right of entry is also known as __________.
Power of termination
Right of entry correlates to the present interest of ________.
Fee simple subject to a condition subsequent
What is the right of the grantor where there is a right of entry?
Estate does not automatically revert; the grantor must exercise her right of entry.
Some courts have held that a right of entry is not transferable __________.
Inter vivos
What is reversion?
The interest that remains after substracting what the grantor has granted from what the grantor originally possessed
Reversion correlates with which present interest?
Estate of lesser quantum
What is the right of the grantor under reversion?
Automatic reversion
What is remainder?
Future interest created in a grantee upon the termination of a prior estate of known fixed duration
A remainder is created only via _______.
express grant in same instrument in which preceding possessory estate is created
A remainder must follow a preceding estate that has _________.
Known fixed duration
A remainder is capable of becoming possessory upon ________.
The natural expiration of the preceding possessory estate
A remainder cannot divest __________.
Prior estates
Any future interest in a grantee that divests a prior estate is ___________.
An executory interest
Vested remainders are:
- Created in an ascertained person AND
- Are not subject to any condition precedent
A vested remainder becomes possessory automatically upon __________.
The termination of the prior estate
If there is a vested remainder subject to complete defeasance, it is either vested subject to being divested by _________ or ________.
Operation of a condition subsequent
Inherent limitation of the estate in remainder
A bested remainder subject to open is vested in ________________.
Persons, at least one of whom is qualified to take possession. The shares of the class are not fixed because more people can join the a class
What is the class-closing rule?
A class closes under the common law rule of convenience when any member of the class can demand possession.
What is the womb rule?
An exception to the class-closing rule; children of B in the womb at A’s death are considered members of the class
When is a continent remainder created?
- In an unascertained person
- Subject to a condition precedent - other than natural termination of preceding estate
Under modern law, grantor and grantor’s heirs hold the estate under contingent remainder subject to ___________.
B’s springing executory interest
What is the Rule in Shellet’s Case?
Converted the contingent remainer in B’s heirs into a vested remainder in B.
After that, doctrine of merger converted them into a single fee simple absolute in B.
Abolished under modern law.
What is the doctrine of worthier title?
O can’t grant something to O that would create remainder to O’s own heirs while O is alive.
What is executory interest?
A future interest in a grantee that, in order to become possessory, must divest or cut short either the prior estate or spring out of the grantor or her heirs
A _________ never divests the prior estate; a __________ always does.
Remainder
Executory interest
What is a shifting executory interest?
A future interest in a grantee that divests or cuts short a defeasible fee in another grantee.
Shifting executory interests always follow _________.
A defeasible fee
What is a springing executory interest?
A future interest in a grantee that vests
and springs out of the grantor at a date subsequent to the granting of the interest
What is the rule against perpetuities?
For a future interest to be valid, the interest must vest - if at all - within 21 years after some life in being at the instrument’s effective date
The Rule Against Perpetuities does not apply to:
- Indefeasibly vested remainders
- Vested remainders subject to complete defeasance OR
- Future interests retained by the grantor
For a contingent remainder, vesting under the Rule Against Perpetuities requires:
- Identification of the taker AND
- Satisfaction of all conditions precedent
For executory interest, vesting under the Rule Against Perpetuities means __________.
Taking of possession
How does the Rule Against Perpetuities apply to Vested Remainders Subject to Open?
A gift to an open class that requires the members of the class to survive past 21 years is void
What is the fertile octogenarian rule?
Presumes that anyone, even an octogenarian, can parent a child, regardless of gender or health
What is the unborn widow rule?
Presumes that a grantor could subsequently marry a person who wasn’t a life in being at the time interest was created
What is the slothful executor rule?
Presumes that the executor of the estate might not probate the will for many years after the testators’s death
What is the precocious toddler rule?
Presumes that it is possible for a toddler to have a child
What are the charitable exceptions to the Rule Against Perpetuities?
- A charitable grant can be perpetual
- RAP does not apply to conveyances from one charity to another
In order to mitigate the harshness of the Rule Against Perpetuities, some states adopted the ______ doctrine.
Wait-and-see
What is the wait-and-see doctrine?
A perpetuity violation should occur only if an interest actually fails to vest within the perpetuity period
What is the Uniform Statutory Rule Against Perpetuities?
- Future interests satisfying the common law RAP are valid
- Any future interest that actually vests within 90 years is also valid
- Cy Pres doctrine
What is the Cy Pres doctrine?
If a future interest fails to vest under common law RAP or within 90 years, the court may reform the interest in a manner that:
- Most closely conforms with the grantor’s intent AND
- Still complies with the RAP
What is joint tenancy?
Each tenant owns undivided share with the right of survivorship
What is a right of survivorship?
When one joint tenant dies, her share passes automatically to the surviving joint tenants
How can joint tenancy be given away?
Transferable inter vivos
What four unities are required to sever a joint tenancy and create tenancy in common?
- Interest vests at the same TIME
- Each tenant must get TITLE by same instrument
- All INTEREST in joint tenancy must be equal shares
- Each tenant must have the right to POSSESS the whole
A conveyance lacking express survivorship language will usually create ________.
A tenancy in common
What is a straw man conveyance?
O conveys to T, who immediately conveys back to O, preserving joint tenancy
How can a joint tenant destroy the right of survivorship?
By severing joint tenancy
At common law, severance of joint tenancy occurs automatically when ________.
Any of the four unities is severed
If joint tenants cannot agree to specific division of land, what options can the court used?
- Partition in kind
- Partition by forced sale
What is a partition in kind?
Division of the property that is in the best interests of all properties
What is a partition by forced sale?
Court determines that forced sale is in best interests of all parties; proceeds divided proportionally
Generally, the court is supposed to order a partition by forced sale only if ___________.
The land cannot be physically divided
What is an inter vivos conveyance where there is joint tenancy?
A joint tenant may sell/transfer her interest in the joint tenancy during her lifetime without the knowledge/consent of the other joint tenants, severing the joint tenancy
What are the two theories on how mortgages affect joint tenancy?
- Lien theory jurisdiction
- Title theory jurisdiction
What are the two theories on how mortgages affect joint tenancy?
- Lien theory jurisdiction
- Title theory jurisdiction
How does the lien theory of mortgages apply to joint tenancy?
Because the mortgage only holds a lien on the property, it doesn’t sever joint tenancy
How does the title theory of mortgages apply to joint tenancy?
Treats title as passing from mortgagor to mortgagee when the mortgage is signed; this severs joint tenancy
______ sale severs the joint tenancy.
Forced sale
Under a judgment lien, when is joint tenancy severed?
When the property is sold at a foreclosure sale
How does a lease by a joint tenant affect joint tenancy?
At common law, it severs joint tenancy.
At modern law, it does not.
What happens to a joint tenancy if one joint tenant is murdered by another.
Severs the joint tenancy; murderer is not entitled to victim’s share by right of survivorship
What is tenancy by the entirety?
Two spouses own undivided share with the right of survivorship
In order for a tenancy by _________ to exist, parties must be validly married to each other.
the entirety
What effect will divorce have on tenancy by the entirety?
Sever it and create a tenancy in common
A _______ _______ agreement between two spouses can sever the right of survivorship
Mutual written
What effect does a unilateral conveyance by one spouse have on a tenancy by the entirety?
Does not sever it
A majority of states hold that a tenancy by the entirety is immune from the claims of _____________ of either spouse.
Separate creditors
What is a tenancy in common?
Each tenant has undivided interest in the property with no right of survivorship
Tenancy in common is presumed by modern law for any conveyance to _________.
Two or more non-married persons
Under a tenancy in common, each tenant must have an equal right to __________.
possess the whole
Is there a right of survivorship in a tenancy in common?
No
The rights and duties of co-tenants apply to what concurrent estates?
- Joint tenancy
- Tenancy by the entirety
- Tenancy in common
What is the general co-tenant right of possession?
Each co-tenant has the right to possess and enjoy the entire property
What is wrongful exclusion?
Improper ouster of a co-tenant
Ouster is required if a co-tenant is trying to obtain title through ________.
Adverse possession
Can co-tenants receive rent if one co-tenant has exclusive possession?
Not unless there has been an ouster
The ouster of a tenant does entitle that tenant to ______.
Rent
Each co-tenant is entitled to her share of profits from _______.
The estate
Each co-tenant must pay her fair share of payments in:
- Taxes
- Mortgages
- Repairs
If there are co-tenants, there is no right to contribution for the cost of _________.
Improvements
When partition occurs, the improvind co-tenant is entitled to _________ but will also _________.
Any increase in value caused by improvements
Be held liable for any decrease in value
A co-tenant must not commit _______.
Waste
Disputes involving real property are governed by what law?
State where the property is situated
Law of the state where a property is situated is also known as the law of _____.
The situs
What is trespass?
Invasion of land by tangible physical object
Trespass to land occurs when:
- D intentionally enters P’s land without permission
- D remains on land without right to be there
- D places tangible object on P’s land without permission
Trespass interferes with the interest in ________.
Exclusive possession of land
If there is trespass, the owner by take action for ______.
Ejectment
What is a private nuisance?
A substantial and unreasonable interference with P’s use and enjoyment of her land
What are the elements of private nuisance?
- P has interest in land
- Unreasonable interference with use & enjoyment of land
- D’s conduct is negligent, abnormally dangerous, or intentional
D’s use and enjoyment of land is unreasonable if:
- Harm to P is greater than utility of D’s conduct OR
- Harm to P is greater than required to ear without compensation
What is lateral and subjacent support?
Describes a landowner’s right to have land physically supported in its natural state by adjoining land and underground structures
D will be strictly liable for damage to buildings on P’s property if the P can show __________.
The weight of the buildings didn’t contribute to the collapse of the land
What are riparian rights?
All landowners whose property is adjacent to a body of water have the right to make reasonable use of it
A riparian owner will be liable to other riparian owners if _______.
Her use of the water unreasonably interferes with other riparian owners’ use of the water
The first person to use water from a water source has the right to ___________.
Continue to use that quantity of water for that purpose
What is percolating water?
Water that seeps or filters through the ground without any definite channel; not part of the flow of any waterway
The owner of the property on the surface of percolating water is entitled to _________.
Make reasonable use of the percolating water but can’t commit waste
What is the common enemy doctrine?
Surface water is a common enemy that damages property at random, so landowners require everyone to act reasonably to protect their own property
What is a leasehold estate?
An interest in land whereby the landholder grants another person exclusive use of land for a limited time, subject to certain terms set forth in the lease
In a leasehold, the tenant has ______ interest and the landlord has _______ interest.
Present possessory
Future
What is a tenancy for years?
Tenancy that terminates at a fixed date.
In a tenancy for years, what dates must be specified?
Beginning and ending dates
If a tenancy for years is based on a lease that exceeds one year, it must be ________.
In writing
Under a tenancy for years, no _____ is required for termination.
Notice
What is a periodic tenancy?
A lease agreement which continues for successive periods until either party gives proper notice of termination
How can a periodic tenancy be created?
- Expressly
- By written agreement
- By implication
- By operation of law
A periodic tenancy is created by implication where __________.
There is no mention of duration but payment is required at specific intervals
How can an oral agreement create a period tenancy?
When there is an oral agreement for a leasehold that is longer than one year and a rental payment is made by the tenant and accepted by the landlord.
How does a holdover lead to a period tenancy?
When a tenant remains on the land after the expiration of the lease and submits a rental payment that is accepted by the landlord
Period tenancy automatically renews for an additional period until _________.
Proper notice of termination is given by either party
To terminate a period tenancy, the tenant must ________.
Provide a reasonable period, at least one period in advance, of notice
If a period tenancy ends, it must end on ________.
The last day of the period
What is a tenancy at will?
A leasehold with no stated duration that will endure only so long as both landlord and tenant desire
How is a tenancy at will created?
- By express agreement
- By implication
How is a tenancy at will created by implication?
When a tenant takes possession under an invalid oral lease, even if no express tenancy at will agreement exists
A tenancy at sufferance exists only when ________.
The tenant “holds over” at the end of a valid lease
A tenancy at sufferance is also known as __________.
A holdover tenancy
How is a tenancy at sufferance terminated?
Landlord either:
1. Evicts the tenant OR
2. Elects to hold tenant to a new tenancy
What are a tenant’s duties?
- Pay rent
- Repair
- Invited third parties
- Tort liability
If a tenant breaches the duty to pay rent while in possession of the land, the landlord may:
- Evict the tenant OR
- Continue the tenancy and sue the tenant for back rent
Even if a tenant fails to pay rent, a landlord may not engage in _______.
Self-help (physically forcing out tenant)
When a tenant breaches the duty to pay rent while out of possession of the land, the landlord can:
- Accept breach as surrender
- Leave the premises vacant OR
- Sue for back rent or re-let the premises and sue the tenant for the deficiency
What does a security deposit do?
Serves to protect the landlord if the tenant breaks or violates the terms of the lease
If a lease is silent regarding repairs, the tenant must __________.
Keep the premises in reasonably good repair by making ordinary repairs and must not commit waste
Whenever a tenant removes a fixture, the tenant has committed voluntary waste even if ________________.
The fixture was originally installed by the tenant
What is a fixture?
Personal property that is attached to land or a building that is objectively regarded as an irremovable part of the real property
If the lease expressly covenants that the tenant must maintain the premises in good condition, then _____________.
The tenant will be held responsible for any loss or destruction
In modern law, what happens if the premises are destroyed and a tenant is not at fault?
Tenant may terminate the lease
What happens if third parties trash a property?
Tenant is still responsible for repairs
What are the duties of landlord?
- Deliver possession
- Implied covenant of quiet enjoyment
- Warrant of habitability
- Landlord’s tort liability
What is the English Rule?
Landlord must put the tenant in actual, physical possession at the beginning of the lease (and evict prior tenants)
What is the implied covenant of quiet enjoyment?
Implied warranty that the landlord will not unreasonably interfere with the tenant’s use and enjoyment of the premises
The implied covenant of quiet enjoyment applies to both ______ and ______ leases.
Commercial
Residential
To make a claim for a constructive eviction, there must be:
- Substantial interference by landlord
- Tenant provided notice to landlord AND
- Tenant must vacate within reasonable time
The implied warranty of ______ cannot be cannot be waived by a tenant
Habitability
What is required under the implied warranty of habitability?
Premises must be fit for basic human habitation
What are a tenant’s remedies for breach of the implied warranty of habitability?
- Move out and terminate the lease
- Reduce/withhold rent
- Repair and deduct OR
- Remain in possession and sue for damages
What is retaliatory eviction?
The requirement that a tenant vacate a unit in response to a complaint from the tenant concerning the condition of the building.
It’s also super illegal.
A landlord is only liable for the acts of other tenants if:
- Landlord must not permit nuisance on the premises AND
- Landlord must control all common areas
Under common law, the landlord has no duty to protect the tenant/tenant’s licensees/invitees, except:
- Landlord must disclose latent defects
- Injuries resulting from negligent voluntary repairs
- Reasonable precaution in common areas
- Land is leased for public use
- Short term lease of a furnished dwelling
The Federal Fair Housing Act prohibits discrimination on the basis of:
- Race
- Color
- Religion
- National origin
- Sex
- Disability
- Familial status
Even under the Fair Housing Act, discrimination is allowed for:
- Single-family homes
- “1-to-4” owner-occupied units
Distinguish between assignment and a sublease.
Tenant has remaining rights to the property for a sublease - not for an assignment.
Assignment is a transfer of _________.
Entire interest
When a tenant assigns her interest, tenant is no longer in privity of ______, but she is still in privity of ______.
Estate with the landlord
Contract
Sublease is transfer of __________.
part of the interest for a portion of the lease term
What is an easement?
A grant of a non-possessory interest in land that entitles a person to use the land possessed by another
What are the two types of easements?
- Affirmative easement
- Negative easement
What is an affirmative easement?
A right to go onto the land of another and do some act
Most easements are what type?
Affirmative
What are the requirements to create affirmative easements?
- Signed by grantor
- Manifest intent to create easement
- Describe the land
- Identify the parties
When will existing use lead to an affirmative easement?
- Ues existed before tract was split in parts
- The part’s use was reasonably necessary for the use/enjoyment of the “dominant part” AND
- The parties intended the use to continue after the division
Affirmative easement by necessity is implied when:
- An owner sells a portion of her estate AND
- The result of the sale is a landlocked parcel of land
Affirmative easements created by necessity require:
- Previous united ownership
- Absolute necessity AND
- Necessity existed at time of severance of property
Affirmative easements created by prescription require:
- Actual use
- Open and notorious
- Adverse (hostile) AND
- Continuous and uninterrupted use for statutory period
What is an affirmative easement by prescription?
Easement acquired by an adverse use for the requisite period
What is a negative easement?
Gives easement holder the right to prevent servient owner from using her land in some way that would otherwise be permitted
At common law, negative easements fall into which categories:
- Light
- Air
- Subjacent or later support
- Stream water from an artificial flow
A minority of jurisdictions recognize negative easements for _________.
Scenic view
A negative easement can only be created expressly by ________.
A writing signed by the grantor
Negative easements are always appurtenant because _____.
It protects the easement’s owner in enjoyment of the land
An easement is appurtenant to land if ________.
The easement benefits the owner in the use and enjoyment of her land
This is what we have.
An appurtenant easement requires two pieces of land: the land benefited, called _______, and the land burdened, called ________.
Dominant tenement
Servient tenemant
An easement is in gross if ______
The easement doesn’t benefit its owner in using her land, but merely gives her the right to use the servient land
How does a dominant tenement pass?
Automatically
How does a servient tenement pass?
Automatically unless bona fide purchaser doesn’t have notice of the easement
Easements in gross are not transferable unless _________.
The easement is for a commercial purpose
An easement will terminate by the stated conditions in ________.
The express grant
An easement will terminate by merger when __________.
One owner obtains title to the servient estate and dominant estate
An easement is terminated by release when _______.
An easement’s owner executes a deed of release to the owner of the servient estate
An easement is terminated by abandonment through non-use when __________.
Its owner demonstrates an intention via physical act to not use the easement again
An easement is terminated by estoppel when ___________.
The servient landowner materially changes her position by reasonably relying on the holder’s assurance that the easement will no longer be enforced
An easement created by necessity expires when ________.
There is no longer an absolute necessity unless the easement was accompanied by an express grant by the owner
An easement is terminated is destroyed by _________.
Something other than a wilful act by the servient owner
What is a license in terms of property?
The mere privilege to use another’s land for a specified purpose
How can a license be created?
Orally or by writing
Oral grant to enter land is a ______, NOT an easement by express grant.
License
A license is revocable at any time at the will of ________.
The licensor
A license is NOT revocable if:
- Estoppel
- License coupled with interest
A license coupled with an interest is one that ___________.
Gives the licensee the right to remove the licensee’s chattels which are on the licensor’s land
What is a profit?
The right to enter the servient estate to remove minerals, timber, oil, etc.
Profits are governed by the same rules of __________.
Easements
What is a covenant?
A contractual limitation related to land
How is a covenant distinguished from an easement?
An easement is a grant of a property interest, while a covenant stems from an action for damages
_______ is required to make a covenant.
Writing
What is a negative or restrictive covenant?
A promise not to do something related to land
A negative covenant is also known as a ________ covenant.
Restrictive
What is a positive or affirmative covenant?
A promise to do something related. toland
A positive covenant is also known as a _______ covenant.
Affirmative
A covenant runs with the land when _______.
It is capable of binding successors
In order for the burden of the covenant to run with the land, the following elements must be satisfied:
- Writing
- Intent of original parties
- Touch & concern the land
- Horizontal and vertical privity
- Notice
What is horizontal privity?
A nexus between the original parties, who are successors in interest.
What is vertical privity?
A nexus between the original party and the successor. Requires a non-hostile connection between the original party and the successor
What forms of notice can exist for a covenant?
- Actual notice
- Imputed notice
- Record
- Inquiry
Actual notice for a covenant is _________.
Direct notice of the covenant
Imputed notice for a covenant occurs when ______.
Agent of successor had actual notice
Record for a covenant occurs when __________.
Constructive notice of an instrument that has been properly recorded
Inquiry for a covenant occurs when ______.
Notice attributed to a person when the information would lead an ordinarily prudent person to investigate the matter further
In order for the benefit of the covenant to run with the land, the following elements must be satisfied:
- Writing required
- Intent of original parties
- Touch and concern the land
- Vertical privity
What is an equitable servitude?
A promise concerning the land that binds the original parties and their successors.
What is the difference between an equitable servitude and a covenant?
The basis for relief; P enforcing an equitable servitude will seek an injunction not damages
In order for the burden of an equitable servitude to run, what requirements must be satisfied?
- Writing
- Intent of original parties
- Touch and concern the land
- Notice
In order for the benefit of an equitable servitude to run, what requirements must be satisfied?
- Writing
- Intent of original parties
- Touch and concern the land
A reciprocal negative servitude can be implied from __________.
A developer’s actions when a developer develops lots of land with a common scheme apparent from the development but one lot is sold without the equitable servitude in the deed
What are the elements of implied equitable servitude?
- Common scheme existed before 1st sale AND
- D had notice of common scheme
What is the defense of changed conditions?
Change in surrounding area warrants alterations to the property. Change must affect the entire area.
What is adverse possession?
Allows a person to obtain title of a land she has taken possession of for the statutorily prescribed period of time
What are the elements of adverse possession?
- Actual
- Exclusive
- Continuous
- Open and Notorious
- Running of the statute
…possession
When is there actual possession for adverse possession?
Claimant literally entered and used the property as the true owner of the property would
When is there exclusive possession for adverse possession?
Claimant doesn’t share the property with either the true owner or anyone else except as would be natural for the normal use of the land
When is there continuous possession for adverse possession?
Clamaint’s possession is uninterrupted for the required statute of limitations
What is tacking?
Permits a claimant to “tack” on her time in adverse possession with a predecessor adverse possessor’s time if there is privity between the two adverse possessor
When is there open and notorious possession for adverse possession?
Requires that the claimant use the land in a manner this would be sufficient to put the true owner on notice of the trespass
When is there hostile possession for adverse possession?
Claimant enters the land without the true owner’s permission
What is running of the statute?
Claimant must be in adverse possession for the statutory period required by the state
The SOL will not run against the owner for adverse possession if, at the time, a cause of action for ejectment arose based on one of the following disabilities:
- Incapacity
- Infancy
- Imprisonment
Once the elements of adverse possession have been met for statutory period, how does property transfer?
Adverse possessor automatically owns the property; not necessary to file any document with the court
Title acquired by adverse possession cannot be defeated by a _______ conveyance from the prior title owner.
Subsequent
A typical real estate transaction involves what three phases:
- The Land Contract
- A period of time for any agreed inspections during which the contract is executory (not yet performed) AND
- The Closing
What are the formalities of a land contract?
- Writing required
- Describe the land
- Identify the parties
- Specify price (or state some other consideration) AND
- Signed by the party to be bound
What is the exception to the writing requirement for land contracts?
Part performance by the buyer
When is there part performance by the buyer?
2/3 required
1. Buyer takes possession
2. Buyer pays all/part of purchase price
3. Buyer makes substantial improvements to land
At closing, even if the contract is silent as to the quality of title, there is an implied promise by the seller that ____________________.
At the closing, the title is free from reasonable doubt, lawsuits, or the threat of lawsuits
Title is unmarketable if _____________.
Any part of the land is subject to:
1. Adverse possession
2. Encumberances
3. Are there are current zoning violations
What are the two most common types of encumbrances?
- Servitudes
- Mortgages
What are the implied promises of a seller in a land contract?
- Marketable title at the closing
- No false statements of material fact AND
- No failure to disclose latent material defects
Failure to disclose latent material defects is not annulled by ____________ disclaimers.
General
Implied warranties of fitness and habitability are also known as ________.
Caveat emptor
A land contract generally contains no implied warranties of ______ or _______.
Fitness
Habitability
A seller is not liable for the condition of any ________ on a property.
Buildings
What is the New Home Exception?
Implied warranty of fitness and workmanlike construction will apply to the sale of a new home by a vendor who also built the home
What is the doctrine of equitable conversion?
Once the land contract is signed, the property interests of the buyer and seller have already switched
Upon equitable conversion, a buyer has ________ interest.
Real property interest
Upon equitable conversion, a seller has ________ interest.
Personal property interest
In jurisdictions that recognize the doctrine of equitable conversion, the switch in interests takes place upon _______.
Execution of the contract
Who bears the risk of loss under equitable conversion?
Majority view: risk in buyer
Minority view: risk on seller
What happens in jurisdictions where equitable conversion is not recognized?
Both title and the risk of loss remain with the seller until the closing
Upon closing, a deed becomes ________.
The operative contract
What is required for a closing to cause a deed to become the operative contract?
- Lawful execution of the deed
- Delivery of the deed
- Acceptance by grantee
When is a deed lawfully executed?
- Writing required
- Identify the parties
- Describe the property AND
- Signed by grantor
Delivery of a deed requires _________.
Words or conduct evidencing a grantor’s intention that the deed has some present operative effect.
For delivery to be effective, the grantor must relinquish _______________.
Absolute and unconditional control over the property
Acceptance of a deed is presumed unless __________.
The grantee has specifically indicated intent not to accept the conveyance
When is a deed void?
- Forged
- Deed never delivered
- Fraud in factum
A void deed will be set aside even if _________.
The property has passed to a bone fide purchaser
When is a deed voidable?
- Lack of capacity
- Infancy
- Duress
- Breach of fiduciary duty
- Undue influence
- Mistake
- Fraud in inducement
What happens if there is a fraudulent conveyance?
Can be set aside by the creditors of the grantor
Fraudulent conveyance is found when:
- Actual intent to hinder, delay, or defraud any creditor of grantor OR
- Without receiving a reasonably equivalent value in exchange
Quitclaim deeds are distinguished by _______.
No covenants or promises by the grantor
What is the one promise that can exist where there is a quitclaim deed?
Marketable title at closing
A general warranty deed contains:
3 present and 3 future covenants
What are the three present covenants found in a general warranty deed?
- Covenant of seisin
- Covenant of right to convey
- Covenant against encumbrances
The three present contracts in a general warranty deed are breached at the time of ________.
Delivery
What is a covenant of seisin?
Grantor warrants that she owns the property/interest she is now conveying
Where there is a covenant of seisin, the measure of damages for breach is ________.
The return of all/portion of purchase price
What is a covenant of right to convey?
Grantor warrants that she has a right to convey the property
What is a covenant against encumbrances?
Grantor warrants that there are no encumbrances on property
The future covenants of a general warranty deed are breached if __________.
Grantee was disturbed while in possession
What are the three types of future covenants within a general warranty?
- Covenant for quiet enjoyment
- Covenant of warranty
- Covenant for further assurances
What is a covenant for quiet enjoyment?
Grantor warrants that grantee will not be disturbed in possession and enjoyment of the property by third party’s lawful assertion of superior title
What is a covenant of warranty?
Grantor warrants that she will defend against lawful claims and that grantor will compensate grantee for any loss that grantee may sustain by assertion of superior title
What is a covenant for further assurances?
Grantor promises that she will execute any other documents required and do anything else reasonably necessary to perfect title
A special warranty deed only contains two promises by the grantor. They are:
- Grantor has not conveyed to another AND
- Free from encumbrances created by grantor
What are the types of recording jurisdictions?
- Race
- Notice
- Race-notice
What is the rule for “race” recording jurisdictions?
The first person to record prevails
What is the least common recording statute type?
Race; only exists in two states
What is the rule for “notice” recording jurisdiction?
A subsequent purchaser for value without notice of the prior interest will prevail regardless of who recorded first
What is the rule for “race-notice” recording jurisdiction?
A subsequent purchaser for value without notice who records first will prevail
Who is a bona fide purchaser?
- Subsequent purchaser
- For valuable consideration
- W/o notice at time of conveyance
What is constructive notice at time of conveyance?
- Inquiry: facts that a reasonable investigation of the land would reveal OR
- Record: facts that a reasonable search of public records would reveal
A BFP is:
Bona fide purchaser
What is the shelter rule?
Any person who takes from a BFP will prevail over any interest over which the BFP would have prevailed.
What is a wild deed?
A recorded deed that is not in the chain of title because of a previously unrecorded deed
A wild deed does not provide ________.
Record notice to later purchasers of the property
What is estoppel by deed?
A first party, who purports to sell property she doesn’t own, must actually convey that property to the 2nd party if the 1st party later acquires title to that property
What is title insurance?
An agreement to indemnify against loss arising from a defect in title to real property that is normally issued to the buyer of the property by the title company that conducts the title search.
A will is ________.
Legal instrument that usually directs the disposition of a person’s property at her death
Ademption by extinction occurs when _______.
The testator has devised a specifically described piece of real property but the piece of property is no longer owned by the testator at her death
Under modern law, the beneficiary of a will takes subject to ____.
The liens
If beneficiary dies before the testator dies, then the gift of real property to the predeceased beneficiary _______
Lapses
If there is an applicable anti-lapse statute, then:
- The gift of real property will not lapse AND
- The lineal descendants of the beneficiary take the gift
Any part of a decedent’s estate not effectively disposed of by will passes by ______.
intestate succession to the decedent’s heirs
The majority of real property sales are negotiated by ________.
Real estate brokers
Who can hire a real estate broker?
Both sellers and buyers
As agents, real estate brokers have a duty to disclose ________.
Material information they have actual knowledge of
The ______ broker is the seller’s agent.
Listing
Both listing and selling brokers earn a commission upon ___________.
Sale of property
The ________ broker is the buyer’s agent.
Selling
Both listing and selling brokers have a fiduciary duty to _________.
The seller
What does a mortgage do?
Conveys a security interest in the land intended by the parties to serve as collateral for repayment of a debt
The creditor of a mortgage is the _______.
Mortgagee
What is a lien?
If a debtor fails to pay, the creditor can foreclose the lien and force sale of the collateral to pay for the debts
The debtor of a mortgage is the _______.
Mortgagor
How is a legal mortgage created?
- Writing required
- Material information included
What material information must be included in a legal mortgage?
- Parties
- Description of land
How can a mortgagee transfer a mortgage?
- Endorsement of note and delivery to transferee OR
- Execution of separate document of assignment
Do recording statutes apply to mortgages?
Yes
When there is a transfer of a mortgage, what personal liability does the buyer bear?
Only for foreclosure
In some jurisdictions, a buyer who didn’t expressly assume a mortgage may be deemed to have impliedly assumed it where _______.
The purchase price reflects the value of the house MINUS the mortgage balance
The purchase price of a mortgage is typically ____________.
Approximate value minus outstanding mortgage
Under which theory can a mortgagee have a right to take possession of the collateral property before foreclosure?
Title theory
What is a foreclosure?
A legal proceeding to terminate a mortgagor’s interest in property, instituted by the mortgagee either to gain title to the property or to foce sale in order to satisfy the unpaid debt secured by the mortgage
The mortgagor is personally liable if the proceeds of the sale do not ________.
Satisfy the debt
if the foreclosure sale results in surplus, the surplus is distributed in the following order:
- Expenses of sale, attorneys’ fees, & court costs
- Accrued interest on foreclosed mortgage
- Junior lienholders
- Mortgagor (debtor)
Foreclosure only terminates the property interests of _______ lienholders.
Junior
Which creditor has priority over all subsequently recorded mortgages after foreclosure?
The secured creditor who is first to record the mortgage has priority over all subsequently-recorded mortgages
What is a subordination agreement?
A legal document used to make the claim of one party junior to a claim in favor of another
Subordination agreements are generally used to _________.
Grant first lien status to a lienholder who would otherwise be secondary to another party, with the approval of the party that would otherwise have first lien
What is equitable subrogation?
A doctrine whereby one who pays off the mortgage obligation of another is treated as the beneficial owner of that original obligation.
What is the common law right of redemption?
While the foreclosure is in progress, the mortgage debtor has the right to redeem the property from the mortgagee by paying the full amount past due under the mortgage (including interest and attorney fees)
What is a mortgage acceleration clause?
A common provision of a mortgage or note providing the holder with the right to demand that the full outstanding balance is immediately due in the event of default
What is a clog on equity of redemption?
Provision in a mortgage agreement to prevent redemption by payment of debt or performance of the obligation for which the security was given.
Such a provision is void.
In a minority of states, the debtor also has a ______ right to redeem the collateral from the buyer after the foreclosure sale.
Statutory
What is a deed of trust?
Deed conveying a title to real property to a trustee as security until the grantor repays the loan
What is an installment land contract?
The buyer will only obtain legal title to the property after all installment payments are paid
An equitable mortgage is also known as an _________ deed.
Absolute
What is an equitable mortgage?
The deposit of title deeds:
1. By the estate’s owner
2. With a person from whom he has borrowed money
3. With an accompanying agreement to execute a regular mortgage
4. Without even any verbal agreement resepcting a regular security
_____ evidence is admissible to demonstrate the intent of parties in an equitable mortgage.
parol
What is a sale-leaseback?
Owner sells property for cash and then leases it back from the buyer
The doctrine of Eminent Domain is also known as _________.
the Takings Clause
What is the doctrine of eminent domain?
The government may take private property for public use if it provides just compensation
A possessory taking occurs when __________.
The government confiscates or physically occupies a person’s property
What is a regulatory taking?
A land use restriction so severe as to require compensation, either as a total taking or under the Penn Central balancing test
A regulation or zoning ordinance that merely __________ is not a regulatory taking
Decreases the value of land
A regulatory taking is considered a per se taking if ___________.
It deprives the owner of 100% of all economic viable use of the owner’s property
Government restrictions on development must be justified by __________.
A benefit that is roughly proportionate to the burden imposed or there will be a taking
A property owner may still bring a takings challenge even if the regulations existed when ________.
The property was acquired
Temporary denial of development of property is not a taking if:
- The government’s action is done in good faith AND
- Meets standards of fairness and justice
A regulatory taking that is not a per se taking will also be considered a taking under the 5th Amendment if ___________.
Burden on the property owner exceeds the benefit of the regulation under the Penn Central test
What is the Penn Central balancing test?
Balance the following factors?
1. Nature of government action
2. Level of diminution in value of the owner’s property
3. Property owner’s reasonable investment-backed expectations
For either a possessory or regulatory taking to be held constitutional, it must be for _______ use.
Public
The public use requirement is satisfied if _______.
The government acts under reasonable belief that taking will benefit the public
Just compensation at the time of a constitutional taking must be measured by __________.
Loss to the owner (fair market value)
What is the remedy for invalid taking?
Terminate the government regulation and pay owner for damages that accrued while the regulation was in effect
What is an exaction?
A concession requiring the developer or landowner to either:
1. Surrender a property interest OR
2. Pay for/provide public facilities/amenities as a condition to a municipality’s approval of a development permit
Exactions are unconstitutional under the 5th and 14th Amendments unless _______.
They meet the Nollan/Dolan tests of essential nexus and rough proportionality
What are the Nollan/Dolan tests?
- A municipality must prove that an exaction’s purpose has an essential nexus to the type of harm the development will cause AND
- There must be a rough proportionality between the amount of the exaction and the extent of the harm the development is projected to cause
What are zoning ordinances?
Laws restricting the use of land or the physical dimensions of buildings on land
What happens if a zoning law is created and land within that zoning has nonconforming use?
The nonconforming use need not cease immediately, but it may not expand, and abandonment terminates the nonconforming use.
A variance from a zoning ordinance will be granted if the proponent demonstrates:
- Undue hardship without the variance AND
- Public won’t suffer substantial detriment from the variance
