property Flashcards
Fee Simple Determinable
Ownership automatically terminates upon a condition and passes to grantor
Look for durational words: “as long as,” “until”
Fee Simple Subject to Condition Subsequent (FSSCS)
When the condition occurs, the grantor can exercise a right of reentry
Look for conditional words (“but if”) and words such as “right to re-enter”
Restraint on Alienation
A grantor can place a reasonable restraint on the grantee’s ability to freely transfer
If the restraint is unreasonable, a court will strike it from the conveyance
Rights and Obligations of Co-Tenants, Rent
- A cotenant does not owe rent for his use of the property
- A cotenant must share rents received from a third party
Rights and Obligations of Co-Tenants, Operating Expenses
(e.g. taxes, mortgage payments)—a cotenant can generally collect expenses if he paid more than his share
Rights and Obligations of Co-Tenants, Repairs and Improvements
- A co-tenant does not have a right to be reimbursed by other co-tenants for repairs,
even if necessary. - A co-tenant may only seek contribution for necessary repairs if the co-tenant gave
notice of the need for repairs.
Types of Leases
a. Tenancy for Years—created by express agreement for fixed period of time
b. Periodic Tenancy—repetitive, ongoing estate measured by set periods that automatically renew (e.g., month-to-month)
c. Tenancy at Will—parties must expressly agree, no fixed period of time, may be terminated by either party at any time
d. Tenancy at Sufferance—a tenant wrongfully holds over past the expiration of the lease, lasts until eviction or converts into a periodic tenancy
Tenant’s Duties to Landlord
-Pay Rent: unless CQE or IWH are breached
-Avoid Waste: tenant cannot damage the property and must repair damages he causes
-Make Reasonable Repairs
Landlord’s Duties to Tenant
-Duty to Repair: landlord must repair damages under RESIDENTIAL leases, UNLESS the tenant caused the damages
-Must not breach Implied Warranty of Habitability
-Must not breach Covenant of Quiet Enjoyment
Implied Warranty of Habitability
- Only applies to residential leases
- Landlord must maintain the property such that it is reasonably suited for residence
*Tenant must give notice to the landlord and reasonable opportunity to repair - If the landlord fails to make repairs, the tenant may:
-Stay in the property and deduct rent until the repair occurs
-Stay in the property, pay for repairs, and deduct the cost from rent
-OR Terminate lease and move out
Covenant of Quiet Enjoyment
- Applies to residential and commercial leases
- The landlord cannot disrupt the tenant’s possession or enjoyment of the property
*Constructive Eviction:
-Landlord substantially interferes with the tenant’s use and enjoyment of the land
-Tenant gives notice of the problem and reasonable time for the landlord to repair, but the landlord does not repair
-Tenant vacates the premises in a reasonable amount of time
Liability Under Assignment’s and Subleases
Original tenant remains liable to landlord for lease obligations under privity of contract
Assignee is liable to landlord for rent and covenants that run with the land under privity
of estate
Subtenant is not liable to landlord because not in privity of contract or estate
Prohibition of Assignments or Subleases
Allowed to prohibit assignment or sublease
If the lease prohibits only assignment, the tenant may still sublease
If the tenant violates the prohibition, the landlord can terminate the lease
* Waiver—if the landlord accepts payment from the new tenant, he waives the right to enforce the prohibition clause
Consent—some clauses allow assignment or sublease only with landlord’s consent
* The landlord can only withhold consent on a commercially reasonable ground
Adverse Possession
-Exclusive: must not share with OWNER
-Continuous: generally without a substantial break
-Hostile: without owner’s permission
-Open/Notorious: must openly use land as owner would
Valid Deed Requirements
-Must identify the parties,
-Must be signed by the grantor,
-Must include words of transfer, and
-Must contain a reasonably definite property description
Intent to Transfer a Valid Deed
-Grantor must intend to make a present transfer of the property interest to the grantee
-Grantor must PRESENTLY intend for transfer, and that present intent is determined by the FACTS
General Warranty Deed
3 PRESENT COVENANTS
Covenant of Seisin—the grantor owns the land as described in the deed
Covenant of the Right to Convey—the grantor has the right to transfer title
Covenant Against Encumbrances—no undisclosed encumbrances
-Breach occurs at time of conveyance
-Do NOT run with the land, a later grantee CANNOT sue original grantor
3 FUTURE COVENANTS
Covenant of Quiet Enjoyment—the grantee’s possession will not be interfered with by a third party’s claim for title
Covenant of Warranty—the grantor will defend against a third party’s claim for title
Covenant of Further Assurances—the grantor will do whatever is necessary to pass title to the grantee
-Breach occurs when there is interference with possession
-DO run with the land; a later grantee CAN sue original grantor
Quitclaim Deed
-Contains no covenants of title
-The grantee receives whatever interest the grantor possessed
Implied Warranty of Fitness or Suitability
-Applies to NEW HOMES
-Seller warrants he used adequate materials and workmanship
-Covers hidden (i.e., latent) defects and obvious (i.e., patent) defects
-The buyer has a duty to reasonably inspect the residence
-Buyer may sue for breach against the builder, developer, and contractors within a
reasonable time after discovery of the defect
Recording Acts
a. Notice Statute—If a person purchases land without notice of a prior interest, the person will prevail in an ownership dispute against the prior interest
b. Race Statute—The first person to record their deed will prevail in an ownership dispute, regardless of knowledge.
c. Race-Notice Jurisdiction—If a person purchases land without notice of the prior interest,
and records first, the person will prevail in an ownership dispute against the prior interest.
Bona Fide Purchaser
- A BFP is a person who pays value for the property and takes it without notice of prior claims.
- Notice and Race-Notice Statutes protect BFPs.
- A BFP must pay value for the interest, it cannot be a gift
-SHELTER RULE: BFPs who are protected by the recording act will “shelter” their grantees from prior claims. - Not protected from Adverse Possessors
Notice
a. Actual—Actual knowledge
b. Inquiry—Reasonable investigation would have disclosed prior claims
c. Constructive—Grantees are on notice of all prior interests that were properly recorded
Wild Deeds—recorded outside the grantor’s chain of title; these do not provide constructive notice to a grantee
Express Easement
-Created by the parties in a writing that complies with the Statute of Frauds
Easement by Necessity
-Created when the dominant property is useless without the benefit of an easement across the neighboring servient property
