Property

Question 1

Ownership

PUPTED

Answer 1

Ownership (interest/estate/title)
Possession
Control of an object with the intent to keep control
Actual possession: when the party physically controls the object
Constructive possession: when the party controls the space in which the object is located
Use
Profitability
Transferability
Exclusivity
Destruction

Question 2

Housing Discrimination

CRORFS & H

Answer 2

Housing Discrimination
42 U.S.C. §3604(a) (CRORFS & H)
Race
Color
Religion
Sex
Familial Status
National Origin
42 U.S.C. §3604(f)(1)
Handicap

Question 3

Modern regulation on residential security deposits in most states

PEIR

Answer 3

Modern regulation on residential security deposits in most states (PEIR, Penalize, Escrow, Interest, Rent):
Penalize landlord for inappropriately failing to return security deposit
Require deposit be held in escrow (deposit remains property of tenant so landlord’s legal problems will not affect it)
Require landlord to pay interest on deposit
Clarify that tenant cannot use deposit to pay last month’s rent
Very few states have any regulations on commercial security deposits

Question 4

Hierarchy of Feudal Land Control

KCSD

Answer 4

Hierarchy of Feudal Land Control (KCSD - King, Chief, Service, Demesne)
King
Tenant in Chief
Tenant in Service (many levels of tenants in service)
Tenant in Demesne (actual possession of the land)

Question 5

Contingent Remainder - a condition must be met before possession of the remainder can occur

UCPU

Answer 5

Contingent Remainder - a condition must be met before possession of the remainder can occur
Elements (UCPU, Unascertained, Condition Precedent, Unborn) - a contingent remainder is either (or more than one):
Created for an ascertained person but is subject to a condition precedent
Created in favor of an unborn person
OR
Created in favor of an unascertained person

Question 6

Vested Remainder

APITA

Answer 6

Vested Remainder
Elements (APITA, Ascertained, Possession Immediate upon Termination, Alive)
The holder of the remainder must be able to go into possession immediately upon the prior estate terminating (merely because of the termination of the prior estate)
The person is ascertained
AND
The person is alive

Question 7

Rule in Shelley’s Case - any remainder in the grantee’s heirs
Elements, all four must be “yes”

FIG RCH SI ST

Answer 7

Rule in Shelley’s Case - any remainder in the grantee’s heirs
Elements, all four must be “yes” (FIG RCH SI ST, Freehold Interest to Grantee, Remainder to Class of Heirs, Same Instrument, Same Type)
Was a freehold interest in real property given to the grantee?
Was the remainder interest in the same property given to the grantee’s heirs or heirs of the body as a class?
Were the interests created by the same instrument?
Were the interests both equitable or both legal?

Question 8

Rule Against Perpetuities - limits how remoted non-vested interests can be
Affects these interests

CONE

Answer 8

Rule Against Perpetuities - limits how remoted non-vested interests can be
Affects these interests (CONE; Contingent, Open, Non-Charitable, Executory):
Contingent Remainders
Vested Remainders Subject To Open
Non-Charitable Trusts
Executory Interests

Question 9

Rule Against Perpetuities Does not apply to

PIG T

Answer 9

Does not apply to (PIG T, Possessory, Indefeasibly, Grantor, Total):
Interests maintained by Grantor
Indefeasibly Vested Remainders
Vested Remainders Subject to Total Divestiture
Possessory Estates

Question 10

Joint Tenancy Four-Fold Unities to exist

PITT

Answer 10

Requires the Four-Fold Unities to exist (PITT, Possession, Interest, Title, Time)
Unity of possession - each tenant is seized of the entire estate, not a divided portion
Unity of interest - each tenant owns an equal share of the estate
Unity of title - each tenant received ownership through the same conveyance
Unity of time - each tenant’s interest vested at the same moment

Question 11

Adverse Possession of Real Estate

ACHOSEN

Answer 11

Adverse Possession of Real Estate
(ACHOSEN, Actual, Continuous, Hostile, Open, Statutory, Exclusive, Notorious)
Actual Possession of the Land
Continuous
Hostile
Open and Notorious (aka “visible”)
For the Statutory Period
Exclusive

Question 12

VOID Deeds - transfer of deed is invalid and cannot be enforced by bona fide purchaser if

FAN

Answer 12

VOID Deeds - transfer of deed is invalid and cannot be enforced by bona fide purchaser if (FAN, Forged, Altered, Nature):
Grantor’s signature is forged
Deed is forged (i.e., materially altered or falsely made with intent to defraud), OR
Grantor is deceived about nature of executed document

Question 13

Basic Lien Priority on Real Property (Highest to Lowest)

P FR OR U

Answer 13

Basic Lien Priority on Real Property (Highest to Lowest) (P FR OR U, Purchase, First Recorded, Other Recorded, Unrecorded)
Purchase Money Mortgage (super priority over prior liens)
First Recorded Liens (senior priority)
All Other Recorded Liens (junior priority)
Unrecorded Liens (lowest priority)

Question 14

MISLAID

FLIP

Answer 14

FLIP

Forgotten, Locus, Intentionally Placed

1. Property placed out of the possession of the true owner intentionally but the true owner forgets to regain possession
2. Right to possession: person controlling the locus in quo, or in the absence of such, the finder
3. Rationale: If the person in control of the locus in quo keeps possession, it will be easier for the true owner to recover it

Question 15

ABANDONED

PINTS

Answer 15

PINTS
Previously, Intend Not, Taking, Surrendered

1. It must have been previously owned
2. Its original owner must have surrendered possession
3. Its original owner must intend not to re-seek possession
4. Title obtained by taking possession

Question 16

NATURALLY PLACED

Answer 16

Property placed on the land by natural forces belongs to the party who owns the “locus in quo”(the place in question)
Right of possession: person controlling the locus in quo

Question 17

TREASURE TROVE

Answer 17

Property hidden out of the possession of the true owner intentionally with intent to not regain immediate possession
The finder

Question 18

LOST

Answer 18

Property out of the possession of the true owner without the true owner realizing it; NOT abandoned
Right of possession: the person who finds it unless they find it within the scope of their employment

Question 19

FOUND PROPERTY TYPES

MANTL

Answer 19

MANTL

Mislaid
Abandoned
Naturally Placed
Treasure Trove
Lost

Question 20

BAILMENT TYPES

Answer 20

Traditionally,

For Hire Gratuitous Constructive

Great Care Reasonable Slight Care
Care

Modern Rule: Reasonable Care over all

All bailments are liable for conversion if destroyed, lost, or stolen, or not returned

Question 21

DISCOVERY RULE - when original owner’s knowledge cannot preclude claim by adverse possession

Answer 21

1. the dispossession occurred longer than the statute of limitations period ago AND
2. for at least that period of time, the true owner knew or should have known
   That the dispossession occurred AND
   Who was in possession of the property

Question 22

ADVERSE POSSESSION
OF PERSONAL PROPERTY

HVACE

Answer 22

HVACE

1. Hostile - without owner’s permission
2. Visible - possession can be perceived
3. Actual - taken into actual possession initially, cannot be based on initial constructive possession
4. Continuous - possession is not surrendered
5. Exclusive - owner is never in possession

Question 23

BONA FIDE PURCHASER
STATUTORY ESTOPPEL

FEWPO

Answer 23

FEWPO
Faith, Entrust, Without, Paid, Ordinary

1. Owner must entrust property to a merchant who deals in that kind of property
2. Buyer must purchase the property in the ordinary course of business
3. Buyer must purchase the property in good faith
4. Buyer must purchase the property without knowledge of the true owner’s title
5. Buyer must have paid value

Question 24

BONA FIDE PURCHASER
EQUITABLE ESTOPPEL

FIP

Answer 24

FIP

Faith, Indicia, Paid

1. True owner must cloak the vendor with an indicia of title (document that shows the possessor has the right to transfer the property such as signed certificate of title or bill of sale)
2. Purchaser must buy in good faith
3. Purchaser must pay value

Question 25

DONATIVE TRANSFER (requirements of a gift)

AID

Answer 25

AID

Acceptance, Intent, Delivery

1. Acceptance (or no rejection)
2. Intent to give (intent to transfer, intent to receive nothing in return)
3. Delivery (such as Actual Delivery, Constructive Delivery, Symbolic Delivery)

Question 26

GIFT CAUSA MORTIS

Answer 26

1. Death must be imminent (not necessarily rational, but expected)
2. Recovery invalidates the gift
   Traditionally, recovery automatically revoked the gift
   Modern day requires express revocation within a reasonable time of recovery
3. Constructive possession does not count; Constructive delivery does count in some circumstances

Question 27

CREATION OF
NON-FREEHOLD ESTATE

OLDTR

Answer 27

OLDTR
Occupied, Lease, Definite, Time, Rental

1. Space must be capable of being legally occupied
2. If period is longer than one year, must be a written lease (Statute of Frauds)
3. Parties must have agreed, expressly or by operation of law, to rent
   A definite space
   For an agreed-upon period of time
   At an agreed-upon rental amount

Question 28

INITIAL POSSESSION RULES

Answer 28

1. English: landlord must put tenant in legal and actual possession
   Actual Possession - tenant can physically occupy land
   Legal Possession - tenant can sue for possession
   Landlord sues hold-over tenant for possession
   Tenant can deduct rent until actual possession given
   English Rule is majority rule for residential tenancies
2. American: landlord must put tenant in legal possess.
   Tenant must sue the hold-over tenant for possession
   Tenant cannot deduct rent; tenant must sue hold-over tenant for damages
   American Rule is majority rule for commercial tenancies

Question 29

TENANCY FOR YEARS

Answer 29

Leasehold that has a definite term of duration
Tenancy has a definite ending date once it starts, even if the starting date is uncertain
Could be for one day, one month, one year, one decade, etc.

Question 30

PERIODIC TENANCY

Answer 30

• Year to year, month to month, week to week are most common
• Proper notice in advance of the end of a period must be given to terminate a periodic tenancy
  
  • Common Law: six months in advance for periods 1+ years; one period in advance for <1 year
  • Many states have modified this by statute

Question 31

TENANCY AT WILL

Answer 31

any leasehold that is not a tenancy for years or periodic tenancy
No duration, it exists until either party terminates it
Traditionally no advanced notice required, though many states have changed this by statute
Tenancy at will can be created expressly or by a failed attempt to create another nonfreehold estate

Question 32

TENANCY AT SUFFERANCE

Answer 32

the right of possession that follows the termination of another form of tenancy

• Gives the right to the tenant to await a court eviction
• For residential tenancies, it also gives the right to continue to receive critical services, e.g. heat and water
• not a true nonfreehold estate
• only the courts and authorities can lawfully remove a tenancy at sufferance

Question 33

HOLDOVER TENANT

Answer 33

tenant who keeps possession of premises after lease has been terminated
1. Landlord may treat tenant as a tenant at sufferance and seek a court eviction OR
2. Treat tenant as a tenant on a periodic tenancy; period is length of duration of the original estate for years
Maximum length period to be created is one year; there is a trend to shift toward periodic tenancy based on time between rent payments

Question 34

RETALIATORY EVICTION DEFENSE PERMISSIVENESS

Answer 34

• Most restrictive states limit defense strictly to tenants who complained about housing code violations to government agency
• Intermediate states allow defense to any tenant being evicted because of any housing-related action the tenant took
• Most permissive states allow defense to tenant being evicted because of the tenant’s assertion of any statutorily or constitutionally protected right

Question 35

RETALIATORY EVICTION DEFENSE PERMISSIVENESS

Answer 35

• Most restrictive states limit defense strictly to tenants who complained about housing code violations to government agency
• Intermediate states allow defense to any tenant being evicted because of any housing-related action the tenant took
• Most permissive states allow defense to tenant being evicted because of the tenant’s assertion of any statutorily or constitutionally protected right

Question 36

SUBLEASE & RULES

Answer 36

Landlord cannot sue new tenant for rent
No landlord-sublessee relationship
Original tenant becomes a tenant AND lessor
Subtenants pay rent to original tenant
Removing a subtenant would be bringing an action of trespass, not eviction

Traditional Rule: sublease does not extend until end of original lease
NY Rule: when original tenant reserves any reversionary interest, such as right to evict
Contractual Rule: intent of parties (Jaber rule)

Question 37

IMPLIED COVENANT OF SUITABILITY / THE RIGHTS OF COMMERCIAL TENANT

Answer 37

• Utah allows commercial tenant to apportion rent if significant and material breach of covenant by landlord occurs
• Mass. allows commercial tenant to apportion rent for any breach of lease
• Texas allows commercial tenant to apportion rent for any breach of lease OR the implied warranty of suitability

Question 38

ABANDONMENT OF LEASEHOLD

Answer 38

Traditional: rent due until end of lease term; landlord can leave empty; landlord cannot retake possession unless provision in lease allowing landlord to act as agent, but landlord would owe fiduciary duty

Modern: landlord must “mitigate” damages; landlord must retake possession, attempt to relet to lessen defaulting tenant’s damages; tenant liable for their rent LESS whatever rent landlord is collecting from new tenant or would be collecting if attempt made

Question 39

Real Property: ASSIGNMENT & RULES

Answer 39

Landlord:assignee = privity of estate
Landlord:tenant = privity of contract
Tenant: assignee = privity of contract
Landlord can sue either for rent
Assignees pay rent to landlord
Assignees do NOT pay rent to tenant

Traditional Rule: assignment extends until end of original lease
NY Rule: when original tenant reserves no reversionary interest, such as right to evict
Contractual Rule: intent of parties (Jaber rule)

Question 40

VESTED REMAINDER

APITA

Answer 40

APITA

Ascertained, Possession Immediate upon Termination, Alive

Question 41

CONTINGENT REMAINDER

UCPU

Answer 41

UCPU

Created for an ascertained person but is subject to a condition precedent
Created in favor of an unborn person
OR
Created in favor of an unascertained person

Question 42

VESTED REMAINDER SUBJECT TO OPEN

Answer 42

Number and identity of the holders of the remainder can change, but the class of holders of the remainder is fixed
AKA vested remainder subject to partial divestiture
Once in the class, never out of the class: “Closes” if…
Producer of new class members dies
“Rule of Convenience” - possessor dies while producer lives
Can be overcome if the grantor expressly states an intent to do so

Question 43

VESTED REMAINDER SUBJECT TO TOTAL DIVESTITURE

Answer 43

Can be possessed immediately but has a condition that has to be satisfied later or possession of the remainder will be terminated

Question 44

DOCTRINE OF DESTRUCTIBILITY

Answer 44

Creates a merger…
applies to contingent remainders
If an estate ends before the condition of a contingent remainder is met, remainder is destroyed (to A for life, then to B if B does X; A dies before B does X; B’s contingent remainder is destroyed and grantor’s reversion becomes possessory)
Most jurisdictions have abolished doctrine of destructibility (MA did in 1836)

Question 45

DOCTRINE OF WORTHIER TITLE

Answer 45

applies when inter vivos transfer of remainder interest to grantor’s heirs
Rule: if owner of A conveys to heirs a remainder in A, remainder void, A retains ownership. If A conveys to B a life estate, remainder in A’s heirs, remainder void, A’s heirs take reversion if A dies intestate.
Rule of law: grantor cannot transfer a remainder interest to his or her heirs
rule of construction: Override rule ONLY IF intent to is made EXPLICITLY clear
ONLY APPLIES TO REMAINDERS
~50% of states repealed; MA in 1973

Question 46

MERGER

Answer 46

when possessory estate and reversionary estate are held by the same party, like when:
Possessory estate ends, but contingency on remainder has not been satisfied
Grantor subsequently conveys reversion to party holding possessory estate
Party holding possessory estate conveys it to grantor
An intervening contingent remainder will not cancel a merger from being created
Exceptions:
A fee tail will not merge into a fee simple
A contingent remainder between life estate and vested remainder will not be destroyed created at the same time

Question 47

RULE IN SHELLEY’S CASE

FIG RCH SI ST

Answer 47

FIG RCH SI ST

Freehold Interest to Grantee, Remainder to Class of Heirs, Same Instrument, Same Type

All must be “yes”:
Was a freehold interest in real property given to the grantee?
Was the remainder interest in the same property given to the grantee’s heirs or heirs of the body as a class?
Were the interests created by the same instrument?
Were the interests both equitable or both legal?

Question 48

RULE AGAINST PERPETUITIES

Answer 48

“No interest is good
unless it must vest,
if at all,
not later than twenty-one years
after some life in being
at the creation of the interest”
- John Grey

Question 49

R.A.P. DOES NOT APPLY

PIG T

Answer 49

PIG T

Possessory, Indefeasibly, Grantor, Total

Interests maintained by Grantor
Indefeasibly Vested Remainders
Vested Remainders Subject to Total Divestiture
Possessory Estates

Question 50

R.A.P. OFTEN APPLIES

Answer 50

Gifts to someone’s children are usually valid because the parent can be the measuring life
Gifts to a dead person’s grandchildren are also usually valid, the children of the deceased grandparent can be the measuring life
Gifts to someone’s children or grandchildren when they reach an age older than 21 can often cause problems
Gifts to a living person’s grandchildren are a BIG problem and will usually be void

Question 51

FOURFOLD UNITIES

PITT

Answer 51

PITT

Possession, Interest, Title, Time

Unity of possession - each tenant is seized of the entire estate, not a divided portion
Unity of interest - each tenant owns an equal share of the estate
Unity of title - each tenant received ownership through the same conveyance
Unity of time - each tenant’s interest vested at the same moment

Question 52

ADVERSE POSSESSION OF
REAL ESTATE

ACHOSEN

Answer 52

ACHOSEN

Actual, Continuous, Hostile, Open, Statutory, Exclusive, Notorious

Actual Possession of the Land
Continuous
Hostile
Open and Notorious (aka “visible”)
For the Statutory Period
Exclusive

Question 53

FOUR TYPES OF WATER RIGHTS

Answer 53

Drainage - concerned with “diffuse surface waters” - water in the form of precipitation
Watercourse - concerned with rivers, lakes, and other bodies of fresh water
Law needs to balance…
Rights of earlier users of water against later users
The importance of the actual use of the water that is being made
The rights of upstream users against downstream users
Aquifer - water found beneath the ground
Littoral - water found in the ocean

Question 54

MORTGAGES
MAJORITY RULE

Answer 54

A mortgage is a LIEN
Most states consider a mortgage to be a lien
A lien is a security device, it does not constitute a conveyance of land
If there is a foreclosure, title will be conveyed at that time
If the mortgage is paid off, the lien is “extiinguished”

Question 55

RIPARIAN RIGHTS -
REASONABLE USE VIEW

Answer 55

(majority view)
Each riparian owner has the right to be free from other’s unreasonable uses of the water which would cause harm to his own reasonable use of the water

Most reasonable use riparian and water use laws relate to the priority of water needs:
1st drinking water
2nd agriculture
3rd industrial

Question 56

VOID DEEDS

FAN

Answer 56

VOID Deeds - transfer of deed is invalid and cannot be enforced by bona fide purchaser if (FAN, Forged, Altered, Nature):
Grantor’s signature is forged
Deed is forged (i.e., materially altered or falsely made with intent to defraud), OR
Grantor is deceived about nature of executed document

Question 57

Basic Lien Priority on Real Property

P FR OR U

Answer 57

Basic Lien Priority on Real Property (Highest to Lowest) (P FR OR U, Purchase, First Recorded, Other Recorded, Unrecorded)
Purchase Money Mortgage (super priority over prior liens)
First Recorded Liens (senior priority)
All Other Recorded Liens (junior priority)
Unrecorded Liens (lowest priority)

Question 58

EASEMENT
ELEMENTS

APWEC

Answer 58

APWEC

Another, Protected, Will, [not] Extended, Conveyance

An interest in land possessed by another allowing limited use or enjoyment of the land
The interest can be protected from interference by others
The interest is not subject to the will of the title holder
The interest is not a right extended to all non-possessors of the land
The interest can be created by conveyance

Question 59

TYPES OF EASEMENTS

Answer 59

Affirmative Easement - allows holder to do things on the other’s land
Negative Easement - allows holder to prevent land possessor from doing certain things
Doesn’t mean it impacts the holder negatively, it just means that it benefits the easement holder by forcing the servient estate owner NOT to do something
Appurtenant Easement - benefits the title holder of a neighboring parcel
Easement in Gross - benefits someone who does not hold title to a neighboring estate

Question 60

CREATING AN EASEMENT ELEMENTS

PINE

Answer 60

PINE

By Prescription
By Implication
By Necessity
Expressly By Deed

Question 61

PRE-EXISTING USE ELEMENTS FOR EASEMENT CREATED BY IMPLICATION

CB AOC PNB

Answer 61

CB AOC PNB
Clinton’s a Bitch; AOC is Pretty and Not a Bitch

Conveyance, Before, Apparent Obvious Continuous Permanent, Necessary and Beneficial

Common ownership of the dominant and servient parcels followed by a conveyance of one or the other
Before the severance of ownership, the use by the dominant estate of land inside the servient estate
The use was apparent, obvious, continuous, and permanent
The claimed easement is necessary and beneficial to the dominant estate

Question 62

EASEMENTS BY IMPLICATION FACTORS (Restatement of Property § 474)

TCKSRUNC

Answer 62

TCKSRUNC

Terms, Consideration, Known, Simultaneous, Reciprocal, Use, Necessity, Claimant

Whether the claimant is the conveyor or conveyee
The terms contained in the conveyance
The consideration given for the conveyance
Whether the claim is made against a simultaneous conveyance
The extent of necessity of the easement to the claimant
Whether reciprocal benefits result to the conveyor and conveyed
Manner in which the land was used before the conveyance
Extent to which the use of land was known to the parties

Question 63

EASEMENTS
CREATED BY PRESCRIPTION

COACU

Answer 63

COACU

Continuously, Openly, Adversely, Claim, Uninterruptedly

For longer than the duration given in the statute of limitations:
Openly: use must be apparent/visible, not secretive
Adversely: the use must be against the title of the estate holder
Continuously: the use must be constant
Uninterruptedly: the use must be continuous and regular, not starting and stopping
Under a Claim of Right: the party claiming the easement must act like an owner

Question 64

ACQUIESCENCE

Answer 64

The servient estate holder’s objection or permission prevents a prescriptive easement from vesting
Estate holder must actually or constructively know of adverse use and not object to the use continuing
Rejection of the use resets the statute of limitation clock to zero; rejection could be simply saying “no” or a no trespassing sign, for instance
This is a minority rule; Maine is one state that uses it

In states that don’t use acquiescence, saying “no” does not impact the statute of limitations clock; instead, in these majority states the servient estate owner must create a physical barrier or file a lawsuit

Question 65

SURCHARGING

Answer 65

An unreasonable increase in use of an easement is known as “surcharging” it

In the event of a surcharge, the court will require the new owners to use the easement collectively rather than individually

Question 66

INTERPRETING AN EASEMENT

Answer 66

Implement the wording that created the easement
Rather than automatically making it void, discrepancy or uncertainty can be clarified by “rule of reasonableness,” balancing the uncertain easement details in a way that benefits one party without harming the other (or benefiting both!)

Question 67

TERMINATION OF
AN EASEMENT

MEAP

Answer 67

MEAP

Merger, Express, Abandonment, Prescription

Express: dominant estate conveys a release to the servient (most common)
Merger: dominant estate acquires servient estate or vice a versa
Abandonment: dominant estate ceases easement use with the objective intent never to use it again
Prescription: servient estate interferes with easement use for statute of limitations time in an open, adverse, continuous, uninterrupted manner
Acquiescence plays a large part in certain jurisdictions

Question 68

CUSTOMARY
RIGHTS DOCTRINE

DLACTIV

Answer 68

DLACTIV

Dispute, Long, Area, Consent, Type, Interruption, Violated

Must…

Have been a long & general use of a servient estate
Have been exercised without interruption
Have been exercised without dispute
Be a reasonable use of the type of land in question
Be limited to a particular area of the land
Have never obtained consent for the use by title holder
Have violated no other laws by the use

Question 69

LITTORAL RIGHTS

Answer 69

Dry Sand: if the sand is dry most of the day, it is the dry sand area
Wet Sand: if you’re getting splashed or your feet are wet, it is the wet sand area

Majority Rule: owner of an oceanfront estate has title up to the mean high tide line; public/state owns the wet sand area of the beach
Minority Rule: (includes MA) owner has title to the mean low tide line; public/state owns the part of the beach usually under water

Question 70

COVENANT VOCABULARY

Answer 70

All real covenants must run with the land (otherwise not a real covenant)
Covenantor/Promissor: party performing promise
Covenantee/Promisee: party receiving promise
Real Covenant: benefits land/estate
Personal Covenant: person benefits from covenant
Burdened: must act on the covenant
Benefit: receives benefit of the
covenant

Question 71

RUNNING WITH THE LAND ELEMENTS

TIP

Answer 71

TIP

Touch, Intent, Privity

Touch and concern the land
Be entered with the intent that the promise will run with the land
Be entered and enforced by parties with the appropriate privity of estate

Question 72

TOUCH AND CONCERN VIEWS

Answer 72

Powell and Bigelow’s View:
If the covenantor’s estate is rendered less valuable because of the promise, the burden runs with the land (think “sacrifice”)
If the covenantee’s estate is rendered more valuable because of the promise, the benefit runs with the land (think “enhanced”)
Considered outdated now due to exceptions and inconsistencies (mutually beneficial covenants, for instance)

Restatement View (modern day approach)
Requires that the promise be of benefit to the use or enjoyment of the land

Question 73

PRIVITY OF ESTATE TYPES

Answer 73

Mutual Privity (English Rule)
The original parties had a continuing interest in the same land (i.e. tenant/landlord, possessor/future interest, cotenants)

Horizontal Privity (Minority American Rule)
The original parties were grantor and grantee on the deed that contained the promise

Vertical Privity (Majority American Rule)
The enforcement parties are successors in interest to the original contracting parties - no specific relationship is needed between the original contracting parties

Question 74

EQUITABLE SERVITUDE

Answer 74

A non-possessory interest that fell just shy of being considered an official legal real covenant
Typically, the privity element is missing or insufficient, not meeting the real covenant threshold

Question 75

IMPLIED RECIPROCAL NEGATIVE
EASEMENT

Answer 75

Enforcement of a restrictive covenant that is not included in the title of the burdened lot

To invoke the theory, the unrestricted lot must
Have originated from a common owner as the restricted lots
AND
Have been purchased with actual or constructive knowledge of the restriction

Question 76

TERMINATION OF A REAL COVENANT OR EQUITABLE SERVITUDE

WECCA

Answer 76

WECCA

Waiver, Expiration, Changing, Conveyance, Abandonment

Waiver - Covenantee fails to enforce the covenant at an earlier time; it then applies to all who might violate it. If the breaching use goes away on its own, the covenant can be enforced again
Changing Use Doctrine - Use of the land around lot has changed so that enforcing the restriction no longer justified. Change must be inside the development. Does not terminate the real covenant, it simply makes it unenforceable in equity
Release is conveyed - Covenantees can voluntarily release the covenants by conveyance to covenantor
Promise is abandoned - Real covenant is not enforced (waiver) with objective intent never to enforce the clause again
Express Termination of Covenants - Expiration due to time limit set at creation

Question 77

STEPS OF A REAL ESTATE SALE

BCSC

Answer 77

BCSC

Binder, Contract, Search, Closing

Binder - a preliminary agreement outlining the terms and conditions of a sale between seller and buyer
Real Estate Sales Contract - a more formal expression of the terms and conditions agreed upon for a real estate sale
Title Search - confirms the seller’s ownership
Closing - event at which contract is performed and the property is conveyed

Question 78

STATUTE OF FRAUDS (PROPERTY)

Answer 78

An Act for Prevention of Frauds and Perjuries

Contracts that violate (or are “within”) the statute of frauds may still be valid, but they will not be enforced by the courts.

To satisfy the Statute, the following must be in writing:
Leases for non-freehold estates over one year
All Real estate contracts unless term is less than one year
Any contract for consideration over $400 (some jurisdictions have increased this amount)

Question 79

REQUIREMENTS OF NOTE OR MEMORANDUM

Answer 79

STRAPPD

Signature, Terms, Real Estate, All, Parties, Price, Date

Signature of “party being charged”
Identity of the Parties (all jurisdictions)
Identity of property conveyed (all jurisdictions)
purchase price (most jurisdictions)
payment terms (most jurisdictions)
closing date (most jurisdictions)
All material terms (most strict conservative jurisdictions)

Question 80

PART PERFORMANCE (PROPERTY)

CPPR

Answer 80

CPPR

Contract, Possession, Payment, Reference

Contract - contract exists, e.g. a valid offer, acceptance, and consideration
Possession - purchaser in possession of the property with the consent of the seller
Payment - purchaser paid all or part of the consideration according to the agreement
Reference - purchaser’s actions only make sense because there was a contract of sale

Question 81

TAKING SOMETHING OUT OF THE
STATUTE OF FRAUDS

FEP

Answer 81

FEP

Fraud - if the statute itself is used as an instrument of fraud, most states will enforce the oral contract

Estoppel - A reasonable and detrimental reliance on an oral estate contract will take it out of the statute (Minority view)

Part Performance - parties have performed some of their obligations that would make the contract inequitable not to enforce

Question 82

BENEFIT OF THE BARGAIN (PROPERTY)

Answer 82

Damages available that are calculated as the difference between the market value of the property at the time of the breach and the contract amount

Based on the theory that the vendee is suffering an injury by losing out on a unique opportunity (such as a great, temporary price on property) that they have been wrongfully deprived of because of breach of the contract

About 50% of states (including MA) only allow this if the breach was willful, fraudulent, or in bad faith

Question 83

MORTGAGE VOCAB 1

MORTGAGE
MORTGAGOR/EE
ESTATE TYPE
LAW DAY
DEFEASANCE CLAUSE
DEFAULT
EQUITY OF REDEMPTION
AMORTIZED
ACCELERATOR CLAUSE
FORECLOSURE

Answer 83

Mortgage - conveyance of land to secure payment of a debt
Mortgagor - the party obtaining financing
Mortgagee - the party providing the money
Estate Type - mortgagee receives fee simple determinable
Law Day - the date final pmt of mortgage due
Defeasance Clause - full pmt on Law Day voids mortgage and legal ownership vests in the mortgagor
Default - a failure by the mortgagor to pay the mortgagee on the law day
Amortized - mortgage pmt plan involving monthly mortgage payments, for instance
The Accelerator Clause - brings the Law Day into the present or near future
Equity of Redemption - right of the mortgagor to pay off the debt after default to recover the property
Foreclosure - a termination of the equity of redemption

Question 84

FORECLOSURE
TYPES

Answer 84

Judicial Foreclosure
By Sale - a decree ordering the sale of the property with the proceeds used first to satisfy the mortgagee and, if a balance remains, the mortgagor
Strict - A decree giving the mortgagee full title and extinguishing the debt
Private Power
The authority given in the mortgage for the mortgagee to sell the property at auction without judicial action

Question 85

MORTGAGE NOTE

Answer 85

a promissory note executed at the time the mortgage is given

Question 86

MORTGAGE CONTINGENCY CLAUSE

TADS

Answer 86

Allows purchaser to cancel the purchase if a lender cannot be found. Should specify:

TADS

Terms, Amount, Date, Source

The basic Terms of financing such as interest and duration
The Amount of financing
The Date until which the purchaser can terminate his or her obligation on the contract for a failure to obtain financing
The Source of financing

Question 87

MORTGAGE PREPAYMENT / SECONDARY MARKET

Answer 87

Unless specifically authorized, mortgages cannot be prepaid
Nowadays, almost all mortgages authorize prepayment, as it is a required feature in order to sell it on the secondary market
Secondary Market - In the US, banks can sell mortgages to federal agencies (Fannie Mae, Ginnie Mae, Freddie Mac…) which are bundled and sold as bonds on Wall Street

Question 88

INSTALLMENT LAND SALES CONTRACT

Answer 88

An agreement requiring the purchaser to make payments towards the purchaser of land
If all the payments are made, the seller will convey the land to the purchaser
Failure to make all payments results in total forfeiture, huge source of fraud

Question 89

MERCHANTABLE / MARKETABLE TITLE

Answer 89

“Readily subject to resale and free from reasonable doubt,” or in more general terms: free from doubt or, in other words, “marketable”; though what that really means is difficult to define

Marketable title does not feature, for instance…
Record title problems
Inchoate rights such as dower
Easements that do not benefit the parcel

Question 90

TENDER (AND DEMAND)

Answer 90

A “tender and demand” must be made before a contract can be considered breached
Party “tenders” their performance and “demands” the other side does as well

Tender and demand establishes the party’s own compliance with the contract so that the other party can be held in breach
Tender - the unconditional offer by one party to perform at least the minimum obligations owed under the contract

Question 91

DEED TYPES

Answer 91

Warranty Deed - a deed that also contains the grantor’s promises about what is being conveyed
Quitclaim Deed - a deed that conveys whatever title the grantor has, if any

Question 92

SECTIONS OF A DEED

IWDRHWEA

Answer 92

IWDRHWEA
I WonDeR How We’ll EAt
Identify, Words, Description, Reservations, Habendum, Warranty, Execution, Acknowledgment

Identity of the parties including the type of cotenancy and the consideration paid
Words of conveyance, e.g. “give, grant, bargain, sell and convey” (Granting Clause)
Description of the land being conveyed
Description of any Reservations being maintained
Habendum Clause with any words of limitation necessary to create the estate being conveyed, often include the phrase “to have and to hold”
The Warranty, if one is being given
The Execution and Acknowledgment of the deed

Question 93

CONVEYING LAND WITH A DEED

Answer 93

The deed must be executed - properly signed and witnessed
The deed must be delivered - properly given to the grantee
Transferring actual or constructive possession

The escrow that is used in almost all real estate conveyances is most typically the cause of problems in satisfying these two requisites

Question 94

DEFECTS WITHIN A DEED

Answer 94

Latent Defect - one that is not apparent from the face of the deed; can be cured by extrinsic evidence
To resolve any mild or minor ambiguities, reference to outside facts is necessary
Patent Defect - one that is apparent from the deed itself; major, hopeless ambiguities can cause patent defects
Patent defects cannot be cured - the deed is void

Question 95

DOCTRINES OF DEED CONSTRUCTION

Answer 95

Main goal: determining intent of the grantor
Best evidence is words in the deed
All the courts will examine in many cases
Extrinsic Evidence can only be used to explain ambiguities in the deed itself
If needed, grantee > grantor, drafting party > other party

Natural landmark > Artificial landmark
Landmark > Adjacent property line
Adjacent property line > course and distance
Course (e.g. “north”) > distance
Everything > statement of total area

Conveyance to a Monument conveys center unless:
The deed states otherwise
The monument is a public road

Question 96

EQUITABLE ESTOPPEL ELEMENTS

PP IG

Answer 96

PP IG
PayPal InstaGram

Possession, Paid, Indicia, Good

Possession
Indicia of Title
Good Faith
Paid Value

Question 97

TITLE SEARCH

CAVE

Answer 97

CAVE
Chain, Adverse, Valid Executed

Goals of a Title Search:
Chain of Title - build the chain of title that shows everyone who has ever held title to the property
Adverse Conveyances - insure that no adverse conveyances were made by anyone in the chain of title
Valid and Properly Executed - determine that all of the deeds appear to be valid and properly executed

Question 98

RECORDING STATUTES

Answer 98

Pure Race: the first grantee to record has title

Race-Notice: the first grantee to record has title unless the grantee knew of an adverse transaction at the time of conveyance

Pure Notice: the final grantee to receive a conveyance has title unless the grantee knew of an adverse transaction at the time of conveyance

Question 99

TERMINATION OF AN EASEMENT BY PRESCRIPTION

SLOACU

Answer 99

SLOACU

Statute of Limitations, Open, Adverse, Continuous, Uninterrupted)

Statute of Limitations
Open
Adverse
Continuous
Uninterrupted

Question 100

ARE WE SURE IT’S AN EASEMENT?

PECUS

Answer 100

PECUS

Protected, [not] Extended, Conveyance, Use, Subject)
Easement is protected from 3d party interference; if not it would not be a property interest
Easement is not a right extended to all non land possessors; just because someone has riparian rights, support rights, etc., they don’t necessarily have an easement
Easement can be created by conveyance; if not, it might be a customary right or something else
Easement is an interest in another’s land allowing limited use; full use would be more likely an estate
Easement not subject to will of title holder; if it is subject to the title holder’s will, it would be a license

Question 101

IMPLIED RECIPROCAL NEGATIVE EASEMENT

OK

Answer 101

OK

Originated, Knowledge

Have originated from a common owner as the restricted lots
AND
Have been purchased with actual or constructive knowledge of the restriction

Question 102

SIX STANDARD WARRANTIES

SEECAW

Answer 102

SEECAW

Seisin, Encumbrances, Enjoyment, Convey, Assurances, Warranty

Seisin
Right to Convey
Against Encumbrances
Further Assurances
Quiet Enjoyment
Warranty

Question 103

TITLE REGISTRATION

ESCIROTH

Answer 103

ESCIROTH
Exact State, Certificate Issued, Registration Office, Title Holder
The court in charge of the records must, in the first instance, determine the exact state of title to a given parcel of land
A certificate is issued by the court that is the title to the land
Certificate is filed in land registration office and no transfer of the land, or an interest in it, is valid unless recorded on this certificate
A duplicate of the certificate is given to title holder and each interest holder

Question 104

CREATING A TRUST

IRB

Answer 104

IRB
Intent, Res, Beneficiaries

Establishing The Intent
Depends on intent of party giving assets, the Settlor
Transfer the Res
Property that is to be held in trust (the res) must be…
Identified so that it is known
Delivered to the trustee (delivery is key!)
Identify the Beneficiaries
A private, non-charitable trust cannot exist if the beneficiaries cannot be determined
A class of beneficiaries can be named so long as the class is capable of objective definition

Question 105

FIDUCIARY OBLIGATIONS

LIP

Answer 105

LIP

Loyalty, Inform, Prudence

Loyalty - the trustee must act for the beneficiaries, not anyone else (including the trustee itself)
Duty to Inform - the trustee must tell the beneficiaries about the status of the trust
Prudence - the trustee must be reasonably careful in managing the trust

Question 106

CHARITABLE TRUST PROPER PURPOSES

CHERMP

Answer 106

CHERMP

Community, Health, Education, Religion, Municipal, Poverty

The relief of poverty
The advancement of education
The advancement of religion
The promotion of health
Government or municipal purposes
Other purposes the accomplishment of which is beneficial to the community

Question 107

EVENTS THAT FOLLOW
A DEATH

SWAMP

Answer 107

SWAMP

Semi-Emergency, [Spouse’s] Will, Assets, Meeting, Probate

Semi-Emergency Matters
If decedent’s spouse died too, spouse’s will should be examined because it likely coordinates with decedent’s will
Preserve assets
Meeting with parties
Start Probate

Question 108

PUBLIC LAND USE REGULATION
DEVICES

COZMAS

Answer 108

COZMAS

Codes, Ownership, Zoning, Maps, Absolute, Subdivision

Absolute Prohibitions (criminal law; not technically land use regulation, but had that effect)
Building, Health, and Fire Codes (example is fire suppression laws, sometimes misguided like the one in Connecticut that eliminated loss of low income housing)
Subdivision Regulation
Official Maps - municipal planning notice to townspeople in advance
Public Ownership of Title - condemnation of property by state
Zoning

Question 109

AMORTIZATION REASONABLENESS FACTORS

ACL

Answer 109

ACL

Avoided, Contradiction, Life

Degree of injury that can be avoided by title holder because of the time extended; if the owner can avoid any financial injury, the period is good
How much the use in in contradiction to the zoning; likely the more contradictory, the shorter the amortization period
Typical useful life of fixtures on the land; considering this allows owner to get the full value of the fixtures

Question 110

VESTED RIGHT MAJORITY VIEW

CEO

Answer 110

CEO

Changes, Expenditures, Obligations

a party will obtain a vested right in a zoning classification if substantial improvements are made in reliance on the classification such as…
Significant changes to the land
Significant expenditure of money
Significant contractual obligations

Developer must be acting in good faith and have made the substantial improvements without knowing that a zoning change is coming
“Substantial” is the operative word here, as is the good faith element of not knowing the zoning change is coming

Question 111

FOUR TYPES OF ZONING

Answer 111

Traditional Zoning, as seen in Euclid, is losing popularity and being substituted with these alternative approaches
Contract Zoning - zoning board uses devices such as restrictive covenants to exact land use regulation; involves municipalities using private land use regulation tools
Floating Zones - zoning that does not apply to a specific tract of land unless the title holder requests that it does so
Cluster Zoning - zoning regulations that establish minimums and maximums for different kinds of uses

Question 112

FACTORS BALANCING REGULATORY TAKINGS

CIS

Answer 112

CIS

Cost, Investment-backed, State

Economic cost to owner
Interference with “distinct investment-backed expectations”
Importance of the state purpose

Question 113

PALAZZO’S IMPACT ON REGULATORY TAKINGS

Answer 113

PEL

Physically, Economically, Legitimate

Some regulations are considered so extreme as to constitute a taking without more (considered categorical takings?)
Physically depriving the owner of land (Loretto)
Denying economically beneficial use of the land (Lucas)
Lingle removed this test from the analysis; the test in challenging the constitutional purpose of a regulation is challenging the due process clause that requires “mere rationality”; the compensation scheme is different post-Lingle, too

The regulation does not serve a legitimate state purpose (this factor later overturned by Lingle v. Chevron)* NOT VALID LAW

Question 114

PENN CENTRAL BALANCING TEST FACTORS

CIS

Answer 114

CIS

Cost, Investment-backed, State

Economic cost to owner
Interference with “distinct investment-backed expectations”
Importance of the state purpose

Question 115

ANALYZING AN EXACTION

Answer 115

Dolan: can you put what the developer wants and what the municipality is requesting in the same sentence, connected by “because?” in other words, is there a nexus between the request of developer and city?
If NO > taking
If YES, move on to Lucas
Lucas: No economic viability left?
If NO economic viability left > Taking
If YES there is economic viability left > move on Penn Central
Penn Central: balancing test of a) investment backed expectations? b) was the gov’t looking to protect health and safety? General welfare? c) is there a significant economic cost to landowner?
Balance in favor of landowner > Taking
Balance in favor of state > No Taking

Question 116

ANALYZING A NON-EXACTION

Answer 116

Loretto: was possession taken or transferred to another?
If YES > Taking
If NO > move on to Lucas (then Penn Central if necessary)
Lucas: No economic viability left?
If NO economic viability left > Taking
If YES there is economic viability left > move on Penn Central
Penn Central: balancing test of a) investment backed expectations? b) was the gov’t looking to protect health and safety? General welfare? c) is there a significant economic cost to landowner?
Balance in favor of landowner > Taking
Balance in favor of state > No Taking

Question 117

DOLAN ANALYSIS

Answer 117

Essential Nexus required between the condition imposed on the land owner and a problem associated with the police power that will be caused by the development
Nexus = analogous with “probable cause,” “proximate causation”
Rough Proportionality Test introduced, requiring that the solution imposed must address the size of the problem caused by the tile holder’s development
No precise mathematical calculation required, just an individualized determination that the dedication is related in nature and extent to the impact on the development

Question 118

Removal of Fixtures by Tenant

TARTBBB

Answer 118

Removal of Fixtures by Tenant - a tenant may remove a fixture from leased property if (TARTBBB, Tenant, Agreement, Restored, Time, Beyond, Breach, Before):
Tenant attached the fixture to the property
There is no agreement to the contrary
The leased property can be and is restored to its former condition
The removal and restoration are made within a reasonable time which
Does not extend beyond termination of the lease UNLESS
Termination was not due to a breach by tenant AND
Date of termination was not foreseeable by tenant sufficiently far enough in advance to permit removal before lease termination

Question 119

Real Property Sale Negligence - Harm to person ON land

CSKR BNKR H

Answer 119

Real Property Sale Negligence - Harm to person ON land
A buyer of real property can sue the seller for negligence if (CSKR BNKR H, Condition, Seller Knew, Risk, Buyer Not Know, Reason, Harm):
A natural or artificial condition existed at time of sale
Seller knew or should have known about the condition
Condition posed an unreasonable risk to persons on land
Buyer did not know, nor should have known, about the condition or risk
Seller had reason to believe buyer would not discover condition or realize risk
Physical harm results from the condition
Time limit
Condition created or concealed by seller = liability until buyer discovers
Condition not created or concealed by seller = liability until buyer has reasonable opportunity to discover

Question 120

Real Property Sale Negligence - Harm to person OFF land

Answer 120

Real Property Sale Negligence - Harm to person OFF land
A buyer of real property can sue the seller for negligence if:
Requires only that the condition existed at time of sale and
Seller knew or should have known condition
Existed, AND
Posed unreasonable risk to persons off land
Time limit
Condition created or concealed by seller = liability until buyer discovers
Condition not created or concealed by seller = liability until buyer has reasonable opportunity to discover

Question 121

Equitable Conversion vs. After-Acquired Title

Answer 121

Equitable Conversion occurs when a party transfers property to another between the party’s execution of a contract to purchase the property and the delivery of the deed to the property. Because the party is the equitable owner of the property between execution and delivery, premature transfer of the property transfers the party’s equitable interest, which becomes legal interest when the deed is delivered and can then also be transferred to the equitable transferee.

After-Acquired Title occurs when a party transfers interest in property to another before the party’s interest actually vests. Thus, when that interest does vest, it instead vests in the transferee rather than the party in whom the property would have originally vested, the premature transferor.

Question 122

After execution of a contract for sale of real property, who bears the risk of loss before the closing date?

Answer 122

(Majority Rule) The buyers, under the doctrine of equitable conversion. Even if the previous owner possesses and lives on the property until the closing date, the buyers bear the risk of loss as the owners under the doctrine of equitable conversion.

Question 123

What is subrogation and how does it affect the positions of parties relating to a mortgage?

Answer 123

A person who pays off another person’s mortgage obligation may become the owner of the obligation and the mortgage to the extent necessary to prevent unjust enrichment. Among the circumstances in which the equitable remedy of subrogation is appropriate is when the payor is under a legal duty to pay the obligation, or when the payor does so to protect his own interest or on account of misrepresentation, mistake, duress, fraud, or undue influence.

However, subrogation is not permitted when the full obligation secured by the mortgage is not discharged.

Question 124

When will an easement by necessity arise?

Answer 124

When property is landlocked without the benefit of an easement across neighboring property, provided that:
1. The two estates must have been under common ownership AND
2. The necessity must have arisen at the time the property was severed (even if the easement itself was not requested or created then; only the necessity for one needed to arise)

Question 125

What is the status of a judgment lien on a person’s real property after the person’s death, if the person’s interest in the property was that of a joint tenancy with right of survivorship?

Answer 125

The judgment lien terminates because upon the person’s death, the interest terminates. It does not transfer, it vanishes.

Question 126

What is the doctrine of cy pres?

Answer 126

Under the doctrine of cy pres, a court may make changes to a conveyance in order to come “as near as possible” to the intent of the transferor. An example of the operation of cy pres would be for the court to change the language of a will to more properly comply with the rule against perpetuities, as the alternative would destroy the testator’s intent.

Question 127

What is the covenant of seisin?
What is the covenant of the right to convey?
What is the covenant against encumbrances?

What damages is the grantee entitled to if there is a breach?

Answer 127

These are the three present covenants embodied in a general warranty deed. As present covenants, they do not run with the land and cannot be enforced by subsequent grantees. The statute of limitations begins to run at the time of conveyance.

Covenant of Seisin: the grantor owns the land as it is described in the deed. Damages = purchase price or cost of perfecting title, whichever is lower.

Covenant of the right to convey: grantor has the right to transfer title. Damages = purchase price or cost cost of perfecting title, whichever is lower.

Covenant against encumbrances: the deed contains no undisclosed encumbrances. Damages = difference in value caused by defect or cost of removing defect, whichever is lower.

Question 128

What is estoppel by deed?

Answer 128

Under the estoppel by deed, a purported grantor is estopped from denying the validity of a deed when the grantor attempts to assert ownership over after-acquired property.

Question 129

What is the covenant of warranty and what does it guarantee?

Answer 129

The covenant of warranty is a future covenant (meaning it runs with the land and survives the merger of the contract and deed) that guarantees that the grantor will defend against a third party’s lawful claim for title.

However, it will NOT require the grantor to defend against a third party’s wrongful claim.

If a third party launches a successful claim against the property, the grantor is liable for the grantee’s litigation costs.

Question 130

Doctrine of Subrogation: What happens when a third party pays off a mortgagor’s loan?

Answer 130

Under the Doctrine of Subrogation, in order to avoid UNJUST ENRICHMENT, when a third party pays off a mortgagor’s loan, the third party becomes the owner of the obligation AND the mortgage, meaning that the mortgagor will owe them the obligation and if they fail to pay, the third party can foreclose on the property under the mortgage agreement.

It does not matter if the third party paid off the loan erroneously or because they were defrauded.

Question 131

Is a deed valid if it has not been delivered to the grantee OR recorded?

Answer 131

NO.

While acceptance of a deed is presumed when the transfer IS FOR VALUE and the grantor has placed it out of their control, it must still be at least recorded if not delivered to an independent 3d party. Recording of the deed is tantamount to delivery, and thus finalizes the transfer by deed.

In other words, “delivery” of a deed can be completed by:
1. Delivery to the grantee
2. Delivery to an independent 3d party
3. Recording

Question 132

What reimbursement duties do cotenants owe one another?

Answer 132

Cotenants have a duty to:
1. Pay proportionate shares of expenses that may give rise to a lien
AND
2. Only upon agreement, contribute to repair or improvement costs

Question 133

What is the effect of a mortgagee transferring:
1. Both the mortgage agreement and promissory note to a 3d party
2. Only the promissory note to a 3d party
3. Only the mortgage agreement to a 3d party

Answer 133

1. Transferee takes claim to mortgage and note
2. Transferee takes claim to mortgage and note
3. Most likely void (depending on jurisdiction)

However, #1 and #2 are ineffective it:
1. Expressly prohibited in note/mortgage
2. Forbidden by statute or public policy
OR
3. Increases mortgagor’s duties, burdens, or risks

Question 134

If a grantee to real property dies before the deed is executed and recorded, what is the effect on the deed?

Answer 134

The deed is VOID

Question 135

Under the fair housing act, are landlords required to provide reasonable accommodations to a person with a disability?

Answer 135

YES.

A landlord is required to permit reasonable modifications to the lease or premises to accommodate handicap at the occupant’s expense.

A service animal would be an example of a required accommodation, even if the lease prohibits pets.

Question 136

What type of issue with a deed would result in a subsequent bona fide purchaser have no recourse to keep the title?

Answer 136

If a deed is forged, if the signature is forged, or if the grantor’s signature was procured by tirkcery, the deed is VOID AT INCEPTION, and no title is conveyed even if relied on by a subsequent bona fide purcahser.

Question 137

If a real property contract prohibits the party in possession from damaging, impairing, or committing waste on the property, but the party tears down part of the property in order to improve other parts of the property that increase its overall value, has the possessory party breached the contract?

Answer 137

YES.

While waste is generally limited to actions that reduce the property value, when the contract specifically prohibits destruction of the property, even an improvement in value will not provide a defense to the commission of waste if property is damaged.

Question 138

For the purposes of notice, would Y’s title search properly give notice of a recorded deed of property by X to Z if X did not own the property then, but then when X did own the property, they conveyed it to Y?

Answer 138

NO.

The title search would not look for property deeded by X, so the conveyance of X to Z would not show up on a title search by Y because Y would not look at conveyances by X, only TO X.

Question 139

In a race notice jurisdiction, when does a subsequent purchaser have priority of title over another’s earlier property interest?

Answer 139

When the subsequent purchaser buys the property without notice of the earlier interest and records before the earlier interest.

Question 140

Property: What is the Shelter Rule?

Answer 140

Under the Shelter Rule, a person who receives property from a BFP is entitled to the same protection under the recording act as the BFP, EVEN if that person would not have otherwise been protected by the recording act.

Question 141

In a notice jurisdiction, when does a subsequent purchaser have priority of title over another’s earlier property interest?

Answer 141

When the subsequent purchaser buys the property for value and does not have notice of the prior interest.

Question 142

If a deed is physically delivered but conditioned with the grantor’s intent that it not be executed or recorded until a later date, has the deed’s requirement of delivery been accomplished?

Answer 142

NO.

Delivery of the deed must be evidenced by the grantor’s intent to presently transfer an interest to the grantee, even if the interest itself is a future interest.

Question 143

When does an adverse possessor of land NOT gain title to the mineral rights below the surface?

Answer 143

When the rightful owner of the land does NOT also own the mineral rights, the adverse possessor only gains title to the surface land that she adversely possesses.

However, if the adverse possessor also adversely possesses the minerals below the surface, she may also gain title against the owner of the mineral rights.

Question 144

When a deed is properly drafted but not delivered during the lifetime of the grantor, is it effective?

Answer 144

NO.

A deed evidence the grantor’s intent to presently transfer ownership. If the deed is not delivered during the grantor’s lifetime, it is void and conveys no interest.

Question 145

When a properly drafted deed is delivered to the grantee, but the grantor subjected the deed to an oral condition upon delivery, is that oral condition enforceable?

Answer 145

NO.

Evidence that the grantor gave the deed to the grantee subject to an oral condition is inadmissible, so the condition cannot be enforced. Once a deed is properly delivered, it is effective.

Question 146

What rights do subsequent bona fide purchasers (BFPs) have in property according to each recording statute?

Answer 146

Race: whichever interest holder records first will prevail

Notice: a subsequent BFP without notice of earlier property interest will prevail

Race-Notice: subsequent BFP without notice and records first will prevail

Question 147

When real property held in trust is not recorded and then sold by the trustee to a BFP, what rights does the trust beneficiary have?

Answer 147

NONE (except in a race-notice juristiction, unless the BFP also files first).

If the real property in trust had been recorded, the subsequent purchaser would have no rights and would not be a BFP. However, because it was not recorded before the transaction.

However, in a race-notice jurisdiction, the BFP’s interest would be cut off if the beneficiary then recorded the real property in trust before the BFP did.

Question 148

What is the difference between a shifting and a springing executory interest?

Answer 148

A shifting executory interest divests some interest in a grantee/transferee prior to its natural expiration

A springing executory interest divests the transferor in the future

A shifting executory interest often violates the rule against perpetuities. While a springing executory interest is subject to the Rule Against Perpetuities, it is often safe because the grantor’s life can be the validating life