Property

Question 1

Doctrine of Worthier Title (for Contingent Remainders)

Answer 1

Rule against remainders in grantor’s heirs. “To A for life, then to O’s heirs.” Instead of contingent remainder in O’s heirs, struck, and reversion in O.

Question 2

Rule in Shelley’s Case (for Contingent Remainders)

Answer 2

**THIS RULE HAS BEEN ABOLISHED IN MOST STATES

At CL, if the same instrument gave the life estate to A and the remainder to A’s heirs, the remainder was not recognized and A took the estate and the remainder.

Ex: “O conveys to A for life, then to Be for life, then to the heirs of A.” The Rule transforms the remainder in A’s heirs into a remainder in A. (No merger in this ex bc of B’s interest - which is vested).

Question 3

Rule of Destructability of Contingent Remainders

Answer 3

ABOLISHED IN MOST STATES

At CL, Contingent remainder would be destroyed if it did not vest by the time of the termination of the estate, leaving merely reversion in O.

“To A for life, then to B’s heirs.” If B died before A, B’s heirs’ contingent remainder would be destroyed.

Question 4

Contingent Remainder

Answer 4

A future interest that is either subject to a condition precedent or in an unascertained person.

In other words, the remainder is not vested yet because it is uncertain.

Ex: O conveys “to A for life, then to B and his heirs IF B marries C.” B’s remainder is contingent bc must marry C before he has right to possession.
Ex: O conveys “to A for life, then to B and his heirs if B marries C, otherwise to D and his heirs.” B and D have alternative contingent remainders.
COMPARE: O conveys “to A for life, then to B and his heirs; but if B marries C, then to D and his heirs.” B has a vested remainder (bc certain, no condition precedent) subject to divestment by D’s executory interest (if condition subsequent is fulfilled).

Question 5

Fee Simple Absolute

Answer 5

The largest possessory estate a person can have. Absolute ownership for indefinite duration.
“To A and his heirs.”

It is devisable, descendible, and alienable.

Question 6

Defeasible fees (definition)

Answer 6

A fee that can be cut short or where another person has a possessory interest: fee simple determinable, fee simple subject to condition subsequent, and fee simple subject to executory limitation.

Question 7

Fee simple determinable

Answer 7

A fee that terminates upon the happening of a stated event, and AUTOMATICALLY reverts to the grantor.
“To A for so long as/during/until…”

Grantor retains interest called a “possibility of reverter”

FSD is devisable, descendible, alienable.

**EXAM TIP: statements of motive or purpose do not create determinable fee. Words limiting the DURATION must be used, not intent.

Question 8

Fee simple subject to condition subsequent

Answer 8

Fee simple subject to condition subsequent is an estate in which the grantor RESERVES the RIGHT to terminate the estate upon an event happening – but it DOES NOT happen automatically.
“To A and his heirs but if/upon condition that/provided that”

FSSCS is devisable, descendible, and alienable.

***EXAM TIP: if conveyance has both durational language and a power of termination, it is probably FSSCS because the forfeiture is at the grantor’s election. **POLICY DISFAVORS forfeiture of estates.

The grantor retains the RIGHT OF ENTRY. It must be expressly reserved – unlike reverter it does not arise automatically.

Question 9

Fee simple subject to executory limitation

Answer 9

An FSD or FSSCS in which the future interest belongs to a third party rather than reverting to the grantor.
Ex: “To A and his heirs for so long as … and if not, to B.” “To A and his heirs, but if . . . to B.”

3rd party has an executory interest.

Question 10

Life estate

Answer 10

A life estate is one measured by the life or lives of one or more persons.

Conventional Life Estates:
Life estates are measured by a life – the grantee’s (“to A for life”) or to another (“to A for the life of B”).
Life estates can be implied from lang like “to B after the life of A.” Suggests A has life estate.
A life estate can be determinable, subject to condition subsequent, and subject to executory interest (eg “to A for life so long as alcohol is not used on the premises” or “to A for life, but if A is divorced, to B”).

Life tenant cannot commit waste:
Affirmative waste - actual conduct that decreases value
Permissive waste - neglect that decreases value
Ameliorative waste - increases value but changes the estate in a way the remainderman doesn’t like.

Grantor retains a Reversion.

Question 11

Three types of future interests Grantor can hold

Answer 11

A reversionary interest arises when a grantor conveys less of an estate than he owns.

Possibility of Reverter - automatic interest in fee subsequent to FSD.
Right of Entry - right to initiate taking of fee subsequent to FSSCS.
Reversion - grantor’s interest after end of life tenancy.

*****EXAM TIP: All reversionary interests are vested and thus not subject to Rule Against Perpetuities.

Question 12

Vested Remainder (generally)

Answer 12

A vested remainder is one created in an existing and ascertained person and not subject to a condition precedent.
I.e. the remainderman has a right to immediate possession upon normal termination of prior estate.

Question 13

Vested Remainder subject to defeasance and Vested Remainder subject to open

Answer 13

A vested remainder subject to complete defeasance is one subject to a condition subsequent.
O conveys “to A for life, then to B and his heirs; but if B dies unmarried, then to C and his heirs.” B has a vested remainder subject to complete divestment by C’s executory interest.

**EXAM TIP: where language is ambiguous, preference is for vested remainders subject to divestment rather than contingent remainders or executory interests. POLICY FAVORS VESTING of estates.

VR Subject to Open: is a vested remainder created in a class of CURRENTLY LIVING persons (eg children) that is certain to become possessory but is subject to change in size - eg by birth of additional persons.
If at least one member of class is ascertainable (eg one child is alive) then it is VRSO, not contingent remainder.

Ex: O conveys “to A for life, then to the children of B.” Chldren of B have vested remainder subject to open.

Question 14

Executory interests

Answer 14

A remainder is a 3rd party’s future interest that arises IMMEDIATELY and at the natural expiration of a prior estate. An executory interest can have a time gap and also can cut off a prior estate.

Ex: O conveys “to A for life, then to B and his heirs.” B has a remainder.
O conveys “to A for life, then to B and his heirs one day after A’s death” - B does NOT have remainder bc of gap, has an executory interest.

Question 15

Rule Against Perpetuities

Answer 15

Interest must vest within 21 years of a life in existence or the interest is invalid.

Question 16

Joint Tenancy

Answer 16

Four Unities needed to form a joint tenancy: time, title, interest, and possession. There must also be a clear right of survivorship.

The tenants must have identical interests, hold those interest at the same time, both have full right of possession, and both have one half interest in the title.

The surviving tenant takes when the other dies.

Termination: the joint tenancy can convert to a tenancy in common (and sever the right of survivorship) by:
A conveyance by one joint tenant
Agreement of joint tenants
Or simultaneous deaths of cotenants
A joint tenancy can be terminated by partition (voluntary or involuntary).
NOTE: if JT is destroyed eg by conveyance, the other tenant keeps their interest as a TIC. also note that if there’s more than two JTs, conveyance by one only destroys JT as to their interest - the other two may still have JT interest.
“Conveyances” that are liens or mortgages don’t sever right of survivorship.

Question 17

Tenancy in Common

Answer 17

Each tenant has a distinct, proportionate, undivided interest in the property.
There is NO RIGHT of survivorship.
“To A and B,” or sometimes, “To A and B as joint tenants.”
Creation: The ONLY UNITY required for TIC is possession.
Termination: can be terminated by partition.

Question 18

Tenancy in Entirety

Answer 18

Each spouse has an undivided interest in the whole estate.
Each spouse has a right of survivorship.
Creation: “To A and B” when A and B are married.

Termination: the right of survivorship may be severed by: death, Divorce, Mutual Agreement

Execution by joint creditor.
CANNOT be terminated by involuntary partition.

Question 19

Types of Tenancy in Landlord-Tenant Relationship

Answer 19

In L-T relationship there are:
-Tenancy for years, where there is a written lease (due to Statute of Frauds) for a fixed period of a year or more

• Periodic tenancy, where tenancy is assumed to renew on each period (usually month to month). Can be terminated at will by either party with notice equal to the period (eg a month).
• Tenancy at sufferance: T wrongfully holds over possession of the premises. L must either (1) hold T to new lease period or (2) evict in court.
• For commercial tenants, the periodic tenancy can be one year if the prior period was for one year or more.
• For residential tenants, even if it was a 1 year lease the new period will typically be month to month.
• If L gives fair notice before the lease expires that occupancy after termination will be at increased rent, T has acquiesced to new terms by holding over (even if verbally objected).
• Exception to hold over doctrine: (1) being in possession just a few hours after termination or leaves a few personal items; (2) delay is not T’s fault (eg severe illness) (3) it is a seasonal lease.

Question 20

Duties of Tenant to a Landlord

Answer 20

T has duty not to commit waste, and a duty to pay rent. At CL also had duty to repair but for residential leases that duty is on the L now.

L’s remedies if T fails to pay rent: (1) eviction action or (2) sue for rent.
L’s remedies if T abandons property: L can accept property back; or can reject abandonment and hold T to lease, but L still has duty to mitigate (re-let).

Question 21

Duties of Landlord to a Tenant (in general)

Answer 21

• Quiet Enjoyment
• Implied Warranty of Habitability (duty to make repairs)
• Cannot evict in retaliation when T exercises rights.

Question 22

Implied Covenant of Quiet Enjoyment

Answer 22

Tenant has the right to quiet enjoyment of the property during the lease. This is breached by

• actual or partial eviction; and
• constructive eviction: L breached a duty to the T that substantially and materially deprived T of use of the property (eg flooding, no heat in winter).

Question 23

Implied Warranty of Habitability

Answer 23

For a residential lease, L guarantees the premises are livable and L has a duty to repair.

If breached, T’s remedies are:

• Terminate the lease
• T can make repairs and offset the cost against rent
• T can abate the rent to an amount equal to the fair rental value due to the defects
• T can remain in possession, pay full rent, and sue for damages.

Question 24

Landlord and Tenants’ Tort Liabilities

Answer 24

Landlord’s Tort Liability:

• L must keep common areas (hallways, etc.) safe under a standard of reasonable care.
• If there is a concealed dangerous condition that the L knows or should know of, that T cannot find with reasonable inspection, L must NOTIFY T (not repair it).
• L has duty of care when it is a furnished short term residence.

Tenant’s Tort Liability:
- At CL depended on whether the victim was a trespasser, invitee (member of public/customer), or licensee (social guest, solicitor).
Trespasser:
(1)No duty to an undiscovered trespasser.
(2)If know of trespasser, should warn them of artificial conditions that risk death/serious bodily harm.
(3)No duty for natural conditions or lesser hazards.
Licensee:
(1) T must warn or make safe a nonobvious and known dangerous condition.
(2) If unknown or obvious, no duty.
Invitee:
(1) T owes duty to make reasonable inspections to discover dangerous conditions and make them safe/warn.
(2)A person loses status as invitee if exceeds scope of the invitation.

Question 25

Adverse Possession

Answer 25

Adverse possession is the doctrine by which a person can acquire land that formerly belonged to another. AP must be Continuous (for the statutory period of time, often 25 years), Open and notorious, actual possession, and hostile to the true owner.

Question 26

Adverse Possession

Answer 26

Adverse possession is the doctrine by which a person can acquire land that formerly belonged to another. AP must be Continuous (for the statutory period of time, often 20 years), Open and notorious, actual possession, and hostile to the true owner.

Question 27

Types of Easements

Answer 27

An easement gives a person a right to limited use of part of another’s land but not the use or enjoyment of that land (e.g. the right to lay pipe through an area, use a path, etc.). Easements can be affirmative or negative.

(1) Easement Appurtenant:
An easement appurtenant is one in which the easement on the servient tenement (the land subject to the easement) benefits the use or enjoyment of another tract of land (the dominant tenement).

• An easement appurtenant RUNS WITH THE LAND: the right is transferred with the dominant tenement regardless of whether it is mentioned in the conveyance.
• The burden of the easement passes when the servient estate is conveyed UNLESS the purchaser is a BFD who lacked actual OR CONSTRUCTIVE notice.
  In other words if BFD bought servient estate and should have known about the easement (observable, expected, etc.) then it runs with the land.

(2)Easement in Gross:
An easement in gross is one that belongs to someone personally and is not connected to another tract of land (eg A has a right to swim in B’s lake).
- An easement for personal pleasure is not transferable but an easement for a commercial interest might be transferable (A has right to erect billboards on B’s land; A can transfer this easement in gross to another).

Scope of easements: must be reasonable. Easement user has duty to repair if he is sole user, or he can share duty/cost with owner if both use it.

Question 28

Termination of Easements

Answer 28

The following are ways to terminate:
(1) Stated Conditions:
The original written easement grant can state conditions for termination.
(2) Unity of Ownership (Merger):
If a single person takes ownership of both servient and dominant tenements, easement extinguishes.
(3) Release:
The owner of an easement can sign a deed of release to the owner of the servient tenement, releasing them from the easement.
(4) Abandonment:
If owner of easement manifestly demonstrates an intent to abandon the easement (eg building a wall blocking the easement path), easement is abandoned.
-Note that mere lack of use or oral expressions are not sufficient. However, long time lack of use, lack of maintenance, repeated oral expressions, may add up to abandonment.
(5) Estoppel
If the owner of the servient tenement substantially changes his position on reasonable reliance of the easement owner’s affirmations/statements/actions, can eliminate the easement by estoppel.
(6) Prescription
To terminate an easement by prescription you have to adverse possess the easement right back, for the full period (typically 20 years).
(7) Necessity
Easements created by necessity expire when the necessity ends.
(8) Condemnation and Destruction
A taking by eminent domain of the servient tenement extinguishes the easement. Unlike leases, unclear whether easement holder gets compensated (cts are split).
If structure in which there is an easement is destroyed involuntarily, easement is extinguished. If voluntarily destroyed the easement remains (prevents shenanigans).

Question 29

License

Answer 29

A license is a personal privilege to enter land, rather than an interest in land; it is personal to the holder, cannot be transferred, and can be revoked by the landowner.

A license is irrevocable in these EXCEPTIONS:
(1) Estoppel:
if a licensee invests substantial money or labor in reasonable reliance on the license then the license cannot be revoked until the licensee has reasonably gained benefit to compensate. In other words this license becomes an Easement By Estoppel.
(2) License Coupled With An Interest:
A license that runs with a true legal interest is irrevocable. Example: a future interest holder in the land has license to enter the land and inspect for waste.

Question 30

Profit

Answer 30

A person can have the right to profits on an exploitable resource on someone else’s land (timber, minerals, etc).

Misuse of the resource/land that overly burdens the servient estate can lead to the profit being extinguished.

Comes with an implied easement to cross the land to access your source of profit (eg timber, mines)

Question 31

Definition and Creation of Covenants

Answer 31

A real covenant is a written promise touching or concerning the land (to do or not do something with the land) (eg to build a fence or to not build a multifamily dwelling).
Real covenants run with the land which means the burden or benefit passes to the next owner.

Creation: there must be (1) a writing and (2) requirements as described elsewhere for burden/benefit to pass.

Question 32

Requirements for Burden and Benefit of Covenants to Run with Land

Answer 32

Running of Burden:
- Intent: the covenanting parties must have intended that successors be bound by the terms.
Can be expressly in the conveyance or implied by circumstances.
- Notice: under modern recording act statutes the successor purchaser must have actual, inquiry, or record notice of the burden at time of purchase.
*****NOTE that this only protects purchasers for value, not someone who gets land as gift.
- Horizontal Privity: the original covenanting parties must have a shared interest in the land apart from the covenant, e.g. mortgagor-mortgagee, landlord-tenant)
- Vertical Privity: the successor holds the same entire interest as the grantor.
- Touch and Concern: the burden (or benefit) must touch and concern the land – you must do something or refrain from doing something with the land.

Running of Benefit:

• Intent: original parties must have intended benefit to run.
• There must be Vertical Privity (but not Horizontal)
• Touch and Concern: see above.

Question 33

Definition and Creation of Equitable Servitude

Answer 33

An equitable servitude is a promise that does not necessarily run with the land at law, but will be enforced against the burden party regardless, in equity. The burdened party must have notice of the promise.

A single promise can create both a real covenant and an equitable servitude. Notable bc the ES can be enforced with an injunction.

Creation:
(1) Intent: Original parties must intend to create a promise that is enforceable against successors.
(2) A writing is usually required to create an Equitable Servitude but there is ONE EXCEPTION: Common Scheme Doctrine (described elsewhere).
(3) Notice: To be bound by equitable servitude must have actual, inquiry (it’s observable by looking around), or record (prior deed with covenant in grantee’s chain of title) notice.
Touch or Concern: the promise must touch or concern the land.
NOTE***: no privity is required, horizontal or vertical.

Equitable relief (injunction) available and equitable defenses (laches, unclean hands, estoppel, acquiescence) are available.

Question 34

Common Scheme Doctrine (for equitable servitude)

Answer 34

If a developer subdivides land and sells lots with the clear intention to have a single restrictive covenant apply to every lot – despite not having the covenant in writing with every buyer – then an equitable servitude will be found. Can prove the existince of a common scheme by:

• Recorded covenant in some of the lots
• Oral statements to early buyers
• General pattern of restrictions (ie should be obvious by looking)

***NOTE - the restrictive covenant cannot be applied retroactively. If Developer sells lots 1-5, then decides he wants a common scheme for lots 6-50, no ES against owners of 1-5.

Question 35

Lateral and Subjacent Support

Answer 35

A landowner is entitled to lateral (side) and subjacent (below) natural support of his land.

• If an adjacent landowner’s excavation causes land to cave in in its natural state, strictly liable.
• If land caved in not in its natural state (ie buildings on it), adjacent landowner is liable only if negligent.
• An underground occupant of land (eg a mining company) must support the surface and buildings existing on the date their estate was created.
• Any later erected buildings requires negligence to be liable.

Question 36

Land Sale Contracts - Validity and Statute of Frauds

Answer 36

Land sale contracts are subject to the statute of frauds and thus must be in a signed writing. Must have the parties, price, and a description of the land (precise enough to identify land).

There is an implied warranty of marketability of title (that there is no encumbrance or dispute as to title) even in a quitclaim deed, in any land sale K.

Question 37

Doctrine of Equitable Conversion (land sale)

Answer 37

The doctrine of equitable conversion states that UPON SIGNING of the K, the equitable right to the land passes to the B and S retains only the legal title and right to proceeds of the sale as personal property.

• S must hold the legal title in trust for the B during this time.
• B assumes risk of loss on the property.
• Even tho risk of loss is on buyer, if property is damaged S must credit any insurance proceeds against the purchase price B must pay.

Question 38

Implied warranty of marketable title

Answer 38

There is an implied warranty of marketability of title (that there is no encumbrance or dispute as to title) even in a quitclaim deed, in any land sale K.
- existence of a mortgage is not enough to breach the warranty - can get settled during the closing sale.

Question 39

Seller’s Liabilities (land sale)

Answer 39

The general rule is that S has no liability for defects in the property. Exceptions include:

• New Construction: S might be liable for an implied warranty of quality or fitness of purpose if it is a brand new house.
• Fraud: if S commits knowingly or negligently misstates a material fact about the property and S relied on that statement, liable.
• Actual Concealment: if S knowingly conceals a material defect (even without making statements of fact), liable.
• Failure to Disclose: in most states, S has duty to disclose defect if:
• He knows or has reason to know of the defect
• The defect is not apparent
• The defect is serious enough that it may affect B’s decisionmaking.

Disclaimers of Liability:

• A general disclaimer (“as is,” “with all defects”) is NOT SUFFICIENT to avoid liability for fraud, concealment, or failure to disclose.
• A specific disclaimer (“seller is not liable for defects in the roof”) might be sufficient (bc S is giving B notice).

Question 40

Deeds - Requirements for validity and delivery

Answer 40

Form of Valid Deed:

(1) In writing
(2) Signed by the Grantor
(3) Reasonably Identify the Parties and Land.
(4) must be properly delivered to grantee and accepted by grantee.

Description of land is sufficient for a valid deed if it provides a “good lead” on the land. If there is a good lead then parol evidence is admissible to resolve ambiguities. If there is NOT, then no extrinsic evidence is admissible. (I.e. “all my land in Stockton” is sufficient).
RULE OF CONSTRUCTION for interpretation -- THIS order of priority:
- Natural monuments (oak tree)
- Aritifical monuments (building, stake)
- Courses (angles)
- Distances
- Name (eg Blackacre)
- Quantity

Delivery is the grantor’s intent to make an immediate transfer. Delivery can be effective on (1) manual delivery of deed to grantee, (2) notarized acknowledgement by grantor and recordation, (3) anything else that shows grantor intends to deliver to grantee.
If the deed contains a CONDITION then there is NO delivery of deed – because grantor seeks to retain interest in the title.

Question 41

Covenants of Title and Estoppel by Deed

Answer 41

Three types of Deeds: (1) General Warranty Deed (2) Special Warranty Deed (3) Quitclaim Deed.
Relating to different assurances about title. Also, these covenants form the basis for possible suit after title passes to B.

(1) General Warranty Deed:
(a) Seisin:
Grantor covenants she is the true owner of the estate she is conveying. Must have both title and possession at time of conveyance.
(b) Right to Convey:
Grantor covenants he has the right to convey the land. Title alone satisfies.
(c) Covenant Against Encumbrances:
Grantor covenants there are no encumbrances, either physical (encroachments) or intangible (eg mortgages/liens).
(d) Covenant for Quiet Enjoyment
Grantor covenants grantee will not be disturbed in possession by 3rd party’s lawful claim of title.
(e) Covenant of Warranty
Grantor agrees to defend grantee against other claims for title and compensate for superior claims to title.
(f) Covenant for Further Assurances
Grantor agrees to do what is reasonably necessary to perfect title.

Breach of Covenants:
If there are successive conveyances by general warranty deed, the last in line who is dispossessed by person with superior title can sue anyone further up the line.
Note that 3 of these covenants are subject to future breach (quiet enjoyment, warranty, further assurances) and 3 can be breached (by definition) at time of conveyance (seisin, encumbrances, right to convey).

(2) Quitclaim Deed:
A quitclaim deed has NO covenants of title implied.
*****REMEMBER that this does not change the implied covenant of marketability of title at time of land sale CONTRACT.

Estoppel by Deed:
- If grantor did not actually have title to an estate and promised the estate by warranty deed to the grantee, then grantor later acquired the estate, the estate goes to grantee.
NOTE*** - if there is a BFP subsequent to the promised grantee, they will keep the estate.
Grantee’s remedies are damages (or accepting title if possible).