Property Flashcards
Fee simple determinable (FSD)
Durational
so long as
until
while
during
Automatically terminates
Future interest? Grantor - possibility of reverter
third party - executory interest
Fee simple subject to a condition subsequent (FSSCS)
Conditional language
but if
upon condition
provided that
if it happens that
Will terminate only if grantor affirmatively demonstrates intent to terminate
Future interest? Grantor - right of re-entry (must be specifically reserved)
Fee simple subject to an executory interest
Limited by conditional language or durational language
Automatically terminates upon happening of event
Future interest? Executory interest
Waste for LT
Not permissible. LT must make repairs for neglect up to the amount of income derived from property (or rental value if in possession)
Amelioritive waste may be permissible if reasonable
Future Interest holder has a license to inspect property of LT for waste
LT allocation of burdens
LT must pay taxes up to the amount of income derived from property or FMV rental value if in sole possession.
pre-existing mortgage obligations divided between LT and future interest holder (interest - LT, principal - LT and FI holder)
Reversion
Held by a grantor following a Life Estate
Possibility of Reverter
Future interest held by grantor following a FSD (not a life estate)
Right of reentry
Future interest held by grantor following a FSSCS
Remainder - vested vs. contingent
Future Interest Following a LE
Vested - at least one ascertainable grantee AND not subject to a condition precedent
Contingent - if either of the above elements is not satisfied
Executory Interest
Future interest following a non-Life Estate
Vested remainder subject to open vs vested remainder subject to complete divestment
Subject to Open - one class member is ascertainable but the class is subject to expand. RAP applies
Subject to complete divestment - Condition subsequent will completely divest the remainder.
Springing vs shifting
Springing - Executory FI following the grantor
Shifting - Executory FI following a grantee
RAP
Specific FI are valid only if they must vest or fail by the end of a life in being plus 21 years
RAP applicability
pretty much applies to most future interests except those that go to the grantor
Does not apply to commercial ROFR or commercial options
Measuring life RAP
the life directly related to the FI under RAP analysis
Creation event RAP
as of the time the FI is created (intervivos vs. upon death)
Class members RAP
bad as to one, bad as to all.
Rule of Convenience saves this - membership closes as soon as one member of the class holding the FI is entitled to possession of the property
Severance of a joint tenancy
mortgages - title vs lien theory
judicial liens - does not sever unless foreclosed upon
Lease - some say it automatically terminates, others say it temporarily suspends the joint tenancy
Periodic Tenancy vs. Tenancy for years
Periodic tenancy has no fixed termination date. Tenancy for years does.
Landlord’s right to future rents
Most states do not allow anticipatory repudiation with respect to leases and therefore the landlord is NOT entitled to future rents. But, landlord is entitled to past rents. The duty to mitigate damages is a separate issue, because even under this doctrine the landlord could just wait and sue for all past rents, but duty to mitigate prohibits that.
Minority rule says that landlord can get future rent, but only measured as difference between future rent and either (1) the reasonable rental value for the future, or (2) the actual rent collected upon re-letting.
Constructive Eviction (breach of the implied warranty of quiet enjoyment)
If the landlord breaches the covenant of quiet enjoyment, the tenant may be excused from paying rent if the following happens:
1 - substantial intereference by landlord with tenant’s right to use and enjoyment of property
2 - T gives notice of the problem
3 - L fails to fix the problem
4 - T must vacate within a reasonable period of time thereafter
Tenant remedy for breach of warranty of habitability
If the landlord breaches the implied warranty of habitability, the tenant can do the following:
1 - T notifies L and gives reasonable time to repair
2 - T can refuse to pay rent, make reasonable repairs and deduct the rent, or remain in possession and pay rent and then seek for damages
Does not include right to vacate
Assignment vs Sublease
Assignment - T gives A-T remaining term on lease. A-T still liable to L because A-T is in privity of estate with L
Sublease - T gives S-T a portion of the remaining term. S-T is not in privity or estate or contract with L, and therefore is not liable.
T remains liable to L under privity of contract
SoF satisfaction
writing, signed by party to be charged, and contain essential terms (parties, property description, price)
A valid deed will satisfy the SoF (words of transfer, both parties, property description, grantor’s signature), but only as to the grantor.
Exceptions, two of the three happens:
1- buyer takes possession of the land
2 - buyer remits part or all of K price
3 - buyer makes substantial improvements to property
OR if detrimental reliance or admission
Deed Delivery
execution and recording of the deed - presumption that it is presently operative
transfer of deed to third party is NOT delivery if the grantor retains an absolute right to recover the deed
Warranty Deed
Seisen
Encumbrances
right to Convey
Quiet enjoyment
Warranty
further Assurances
Restraints on alienation
total prohibition on alienation is invalid
BUT,
forfeiture or promissory restraints on life estate or future interest are valid
Easement by necessity
Land held in common ownership
Severance created necessity
property virtually useless without easement
Easement by implication
land held in common ownership
Quasi-easement (common owner used the land before severance to cross, easement benefited the other portion of the land)
Prior use was continuous, apparent, and known
Use of easement is reasonably necessary to the use and enjoyment
Termination of Easement
Release (must comply with SoF)
Merger
Abandonment - mere non-use is not enough
Destruction or end of necessity
Real Covenant
Writing
Intent
Touch/Concern - affect use and enjoyment of land
Notice (burden only)
Privity - Horizontal (burden only) - ORIGINAL PARTIES must be in privity.
Vertical - SUCCESSOR PARTIES. total for burden to run, partial for benefit to run
DAMAGES
Equitable Servitude
Writing
intent
Touch/Concern
Notice (only if it will be enforced against purchaser)
INJUNCTION
Implied Reciprocal Servitude
Intent to create servitude on all plats (common scheme)
Must be a negative servitude
Notice by party against whom enforcement is sought
Which subsequent owner of property can assert the same contract defenses against the mortgagoee - donee or purchaser?
Only the donee
A purchaser of property who assumes mortgage cannot avoid the assumed mortgage, this would be considered unjust enrichment of the purchaser.
Condemnation of rental property - excuse to pay rent?
If total condemnation, then yes.
If partial, no. tenant must pay rent but is entitled to compensation from condemnation
Implied warranty of fitness
For new homes
warrants use of adequate materials and workmanship, warrants against latent defects.
Mortgages - subject to vs assume
Original mortgagor (OM) is free to sell mortgaged property. But, absent a novation, the OM remains personally liable for the debt.
The subsequent buyer’s personal liability depends on:
-subject to - not personally liable
-assume - buyer become primarily personally liable, mortgagor becomes secondarily liable
When is a deed void?
An undelivered deed is void, not simply voidable. Meaning a BFP will not succeed if the original deed was never delivered.
When does a modification of a senior mortgage lead to a loss in priority over junior interests?
Only if it materially prejudices the junior interests.
A time extension is not materially prejudicial.
Riparian vs. Prior appropriation doctrine
Riparian - as long as it does not unreasonably interefere downstream
Prior appropriation - first in time, first in right
Adverse Possession
ECHO
Exclusive
Continuous
Hostile
Open and notorious
Constructive AP? Receive under color of title, possession of part leads to possession of whole
Attractive Nuisance Doctrine (All Adolescents and Youth Underestimate Risk)
(1) artificial condition exists on property
(2) owner knows or has reason to know that condition is attractive to children and poses a risk of death or serious bodily injury to children
(3) children cannot appreciate the danger because of their youth
(4) utility is slight compared to cost of prevention
(5) owner fails to use reasonably care and caution to protect children
AAYUR - (Any Adolescents or Youth Underestimate Risk)
Duty to Disclose
Commercial - No duty to disclose unless otherwise provided
Residential - Must disclose known material defects that buyer could not reasonably discover
EXCEPT: “as is” clause
Fair Housing Act
Prohibits discrimination in sale, rent, advertising of dwelling based on race, religion, color, sex, handicap, national origin, familial status.
Includes the denial of reasonable accommodations for handicap person at occupant’s expense
For racial discrimination, enough to show disparate impact.
Deed in lieu of foreclosure
Allows mortgagee to take immediate possession of property without foreclosures.
does NOT extinguish junior mortgages.
Four unities for joint tenancy
P- possession
I- interests - identical and equal
T- created at same Time
T - by the same Title
Remedy for breach of title covenants?
Lesser of diminution in value OR cost of removing defect
May be precluded from recovering if there is NOTICE of encumbrance.
Abandonment of Lease
This is an offer to surrender that can be accepted by landlord. Will be accepted if landlord retakes possession of the premises or re-lets to a third party
Duties of Co-tenants
Pay necessary property related expenses (property taxes, mortgage payments), unless Co-T is in sole possession, then they can only receive contribution for amount above FMV.
Expansion of prior existing non-conforming use
Typically, any use that was existing at time of rezoning will be grandfathered in.
Will not be able to expand to change nature and character.
But may be able to expand to increase frequency and if it is not a substantial change.
Priority for future advance mortgage
If the future advance is obligatory - it will have priority over all junior lienholders that arise after, even if it does not give value.
If the future advance is optional - it will only have priority in funds advanced prior to it having notice of the subsequent mortgage
When is a fixture part of the home in a sale?
Generally, anything fixed or attached to property is a fixture unless a reasonable person would conclude that it was not attached with intent to make it part of property.
(1) importance to owner
(2) whether specifically designed for property
(3) amount of damage if removed from property
