Property

Question 1

Name present interests & the future interests they are associated with

Answer 1

• Fee Simple Determinable (durational language) → Possibility of Reverter
• Fee Simple Subject to Condition Subsequent (conditional language) → Right of Entry
• Fee Simple Subject to Executory Interest → Executory Interest
• Life Estate → Reversion (grantor) OR Remainder (3rd party)

Question 2

“so long as” creates what present interest?

Answer 2

Fee Simple Determinable

Question 3

“but if” creates what present interest?

Answer 3

Fee Simple Subject to Condition Subsequent

Question 4

“while” creates what present interest?

Answer 4

Fee Simple Determinable

Question 5

“during” creates what present interest?

Answer 5

Fee Simple Determinable

Question 6

“provided” creates what present interest?

Answer 6

Fee Simple Subject to Condition Subsequent

Question 7

“on the condition that” creates what present interest?

Answer 7

Fee Simple Subject to Condition Subsequent

Question 8

“until” creates what present interest?

Answer 8

Fee Simple Determinable

Question 9

Reqs to create joint tenancy

Answer 9

(1) Grantor must make a clear expression of intent
(2) Must have Unity of PITT (four unities):
(a) Possession: Requires every joint tenant have an equal right to possess the whole of the property (also required by Tenancy in Common)
(b) Interest: Tenants must have an equal share of the same type of interest (e.g. fee simple)
(c) Time: must receive their interests at the same time.
(d) Title: must receive their interests in the same instrument

Question 10

What rights/liabilties are shared in Co-ownership

Answer 10

Rent: Received from a 3rd party, minus operating expenses, are divided based on ownership interests of each co-tenant

Operating Expenses: Necessary charges, such as taxes or mortgage interest payments
-BUT no right for reimbursement for repairs or improvement unless credited in partition

Question 11

Doctrine of Worthier Title; Rule in Shelly’s Case

Answer 11

Doctrine of Worthier Title: Prevents against remainders in grantor’s heirs, turns into a reversion to grantor

Rule in Shelley’s Case: Prevents against remainders in grantee’s heirs → Uses doctrine of merger to create a fee simple

Question 12

What interests are subject to RAP? What are the exceptions?

Answer 12

o Contingent Remainders
o Executory interests
o Vested remainders subject to open (if not closed by rule of convenience)

Exceptions:

(1) gift from one charity to another charity (e.g. Oliver conveys Blackacre “to the Donald McRonald House so long as the property is used to support cancer patients and their families, then to the Glaser Elizabeth Pediatric AIDS Fund.”)
(2) options held by a current tenant to purchase a fee interest in the leasehold property

Question 13

Tenant’s Duties

Answer 13

(1) pay rent

(2) avoid waste

Question 14

When is the duty to pay rent suspended?

Answer 14

(1) premises destroyed (as long as tenant didn’t do it)
(2) he landlord completely or partially evicts the tenant
• Complete eviction: removal of tenant from the entire property
• Partial eviction: removal of tenant from a portion of the property
(3) landlord materially breaches the lease, e.g.,…
• implied covenant of quiet enjoyment
• implied warrant of habitability

Question 15

Implied Covenant of Quiet Enjoyment

Answer 15

The tenant can withhold rent when the landlord takes actions that make the premises wholly or substantially unsuitable for their intended purposes, and the tenant is constructively evicted.

Constructive Eviction—four elements:
i) Premises were unusable for their intended purposes (i.e.,
breach of the covenant of quiet enjoyment);
ii) The tenant notifies landlord of the problem;
iii) The landlord fails to correct the problem; and
iv) The tenant vacates the premises after a reasonable amount of time has passed.

Question 16

Difference b/w Implied Covenant of Quiet Enjoyment and Implied Warranty of Habitability w/r/t w/holding rent

Answer 16

Unlike quiet enjoyment and constructive eviction, IWH does not require the tenant to vacate the premises.

Question 17

Types of Waste

Answer 17

• affirmative waste: tenant voluntarily made a change that decreases the value of the property
• permissive waste: tenant allowed the change
• ameliorative waste: tenant makes a change that increases the value (landlords usually require permission)

Question 18

Landlord’s duty to mitigate tenant’s abandonment by re-renting

Answer 18

majority rule: landlord must treat property as any other property she’d try to rent then is entitled to the difference; otherwise tenant relieved of rent obligation;
minority rule: no duty to mitigate - usually the case for commercial leases

Question 19

Duty to Deliver Possession

Answer 19

• Majority Rule: The landlord must deliver actual possession of the leasehold premises. This means hysical possession of the property.
• Minority Rule: The landlord only required to deliver legal possession.

Question 20

What must the landlord control?

Answer 20

o The landlord must control:
–common areas
–nuisance like behavior of other tenants
o The landlord does not have to control:
–Off-premises actions of 3rd parties that are beyond the landlord’s control, (e.g., the noisy bar across the street)
–BUT In a residential lease, the landlord must provide habitable premises.

Question 21

Assignment vs. Sublease

Answer 21

• Assignment is a complete transfer of the tenant’s remaining term.
• Sublease is a transfer for less than the entire duration of the lease.

rent liability? privity of estate follows reversionary interest:

• If an assignment, landlord can collect from tenant (privity of K) or subtenant (privity of estate)
• if sublease, landlord can collect only from tenant (privity of K and estate)

Question 22

Can the landlord deny permission to a transfer of the lease?

Answer 22

o MajorityRule:only for a commercially reasonable reason.

o MinorityRule: at hear discretion (i.e. any reason or no reason at all.)

Question 23

Elements of Adverse Possession

Answer 23

1. continuous
2. open and notorious
3. hostile
4. exclusive (i.e. not shared w/ title holder)

Question 24

Adverse Possession and Future Interests

Answer 24

DOES NOT run against future interests that exist at the time that the adverse possession begins
DOES apply to a future interest created from a fee simple absolute estate after the adverse possession has begun.

Question 25

How to tack for adverse possession?

Answer 25

the current adverse possessor must be in privity with the prior adverse possessor (i.e. didn’t take adversely from that party)

Question 26

Who does adverse possession not apply to?

Answer 26

Owners w/ disabilities: insane, infant, incarcerated

must exist when AP started. Resets the counter to when disability ends.

Question 27

What must the adverse possessor’s state of mind be?

Answer 27

o Majority: doesn’t take SoM into account

o Minority: split into 2 camps - either must take in good faith or in bad faith

Question 28

What can expand the scope of an adverse possession?

Answer 28

Constructive adverse possession: Adverse possessor enters under color of title from an invalid instrument (e.g., fraudulent deed) and occupies a portion of the property described in the instrument. The adverse possessor is in actual possession of the occupied land and constructive possession of remaining land described in the deed.

Question 29

What does every land sale K include?

Answer 29

Every land sale contract includes an implied covenant of marketable title.

Marketable title: Title that is free from an unreasonable risk of litigation, e.g….
… Title acquired by adverse possession that hasn’t been quieted
…Private encumbrances, e.g., mortgage, covenant, easement
…Violation of a zoning ordinance

if seller can’t deliver marketable title, buyer can rescind

Question 30

Duty to disclose defects

Answer 30

Most jurisdictions impose a duty on the seller to disclose to the buyer all known, physical material defects

Question 31

Implied Warranty of Fitness or Suitability

Answer 31

applies to defects in new construction

depending on JX, either original owner or both owner and buyer can enforce

suit must be brought w/in reasonable time after discovery of defect

Question 32

Uniform Vendor and Purchaser Risk Act

Answer 32

Places the risk of loss on the seller until the closing and delivery of deed

Question 33

Two kinds of mortgages:

Answer 33

(1) Purchase money mortgage: Person takes out a loan for the purpose of purchasing property
(2) Future advance mortgage: A line of credit used for home equity, construction, business, and commercial loans (often referred to as a “second mortgage”)

Question 34

Rules re: assumption of mortgage

Answer 34

presumption is that buyer takes “subject to mortgage” (i.e. doesn’t assume liability)

If the transferee assumes the mortgage, mortgagor/borrower is secondarily liable for the mortgage.

In most jurisdictions, the assumption agreement does not need to be in writing

minority: can presume assumption if loan amount deducted from price of prop

Question 35

Mortgage and Note: what follows what?

Answer 35

mortgage follows the note

if someone transfers the mortgage but not the note. The transfer is either (i) void because the note is the evidence of the debt, or (ii) the note and mortgage are considered a single entity, thus the note follows the mortgage.

Question 36

Mortgage in Land vs. Mortgage in Fixture

Answer 36

The general rule is that when there is a conflict between the mortgagee of real property and the holder of a security interest in a fixture attached to the real property, the first to record has priority over the fixture.

Question 37

Exceptions to the first in time rule w/ mortgages

Answer 37

1) Purchase-money mortgage exception - Has priority over all mortgages, even those earlier in time. (Lender who gave the money to buy the house has the top priority.)
2) Recording act exception - A senior mortgage may sometimes not get recorded. A junior mortgage that satisfies the requirements of the state recording statute act may take priority over the unrecorded senior mortgage.
3) Subordination agreement between mortgagees - A senior mortgagee can agree to subordinate its interest to a junior interest.
4) Mortgage modifications - A senior mortgagee who enters into an agreement with the mortgagor/landowner to modify the mortgage by making it more burdensome subordinates its interest, but only as to the modification. The original mortgage will otherwise remain superior.
5) Future-advances mortgages - Line of credit.

Question 38

Transfer of Deeds

Answer 38

must be delivered and accepted

delivery:

• needn’t be physical
• watch out for delivery incomplete or seemingly revokable

Acceptance is generally presumed provided the gift is for value.

Question 39

Estoppel by Deed

Answer 39

when a grantor conveys land the grantor does not and subsequently acquires title to the land, the grantor is estopped from trying to repossess on grounds that he didn’t have title when he made the original conveyance.

Question 40

Shelter Rule

Answer 40

A person who takes from a bona fide purchaser protected by the recording act has the same rights as his grantor.

Question 41

deed that provides maximum protection

Answer 41

General Warranty Deed

Question 42

Special Warranty Deed

Answer 42

It includes the same six covenants as a general warranty deed, but they only apply to the acts (or omissions) of the grantor.

Question 43

deed w/ no warranties

Answer 43

Quitclaim Deed

Question 44

Implied Covenants in a General Warranty Deed

Answer 44

Present Covenants
• Covenant of seisin: Warrants that the deed describes the land in question
• Covenant of the right to convey: Warrants that the grantor (i.e., the seller) has the right to convey the property
• Covenant against encumbrances: Warrants that there are no undisclosed encumbrances on the property that could limit its value

Future Covenants
• Covenant of quiet enjoyment: Grantor promises to defend against future challenges to the grantee’s title to the property
• Covenant of warranty: Grantor promises to defend against future assertions of encroachment
• Covenant of further assurances: Grantor promises to fix future title problems

Question 45

Trespassers rights w/r/t fixtures and improvementsthey install

Answer 45

o Old Rule: Trespassers could never remove any fixtures or improvements that they installed.
o New Rule: Modern/majority rule is that trespassers can remove an improvement, or at least recover the value added to the property, so long as they acted in good faith.

Question 46

Hierarchy of Gifts in Will w/r/t creditors claims

Answer 46

The order of abatement is usually:

1. Intestate property
2. The residuary of the estate
3. General Devises—i.e., cash gifts
4. Demonstrative Devises—i.e., cash gifts from a specific account, stocks, bonds, securities, etc.
5. Specific Devises—i.e., specified items of personal property, real property, etc.

…Non-probate property—i.e., life insurance policies—do not abate

Question 47

Types of Easements

Answer 47

Express Easement (must satisfy SoF)

Implied Easements:

• easement by necessity
• easement by implication (easement by prior use)
• easement by prescription
• easement by estoppel

Question 48

reqs for easement by necessity

Answer 48

1) Common Ownership: Dominant and servient estates were owned by one person:
2) Necessity at Severence: Necessity arose when the estates were severed into two separate estates, and at that severance, one of the properties became virtually useless without an easement

necessity judged strictly

Question 49

Reqs for easement by implication

Answer 49

1) common ownership: A large estate owned by one owner
2) quasi-easement: Before division, the owner of the large tract uses the land as if there’s an easement on it (“quasi” because an owner can’t have an easement over her own land.)
3) Use must be continuous and apparent at the time of severance.
4) Use must be reasonably necessary to the dominant estate’s use and enjoyment

Question 50

reqs for easement by prescription

Answer 50

Elements are the same as adverse possession, except exclusivity:
o Continuous for statutory period
o Open and notorious, and
o Hostile

Question 51

reqs for easement by estoppel

Answer 51

1. permissive use
2. neighbor relies on the 1st neighbor’s promise
3. 1st neighbor w/draws the permission

result: 1st neighbor is estopped from w/drawing permission

Question 52

Terminating an easement

Answer 52

1. release: owner expressly releases it in writing
2. merger: owner of the easement acquires fee title to the underlying estate
3. abandonment: Owner acts in an affirmative way that shows a clear intent to relinquish the right (need more than non-use or statements; usually need non-use plus act demonstrating intent to abandon)
4. prescription: holder fails to protect against a trespasser for the statutory period
5. Sale to a bona fide purchaser
6. Estoppel: Servient owner changes position to his detriment in reliance on statements/conduct of the easement holder that the easement is abandoned
7. end of necessity

Question 53

Reqs for a Covenant to “run with the land”

Answer 53

1. writing
2. intent: original parties must intend it to run w/ the land
3. touch and concern: Benefit or burden of the covenant must affect both the promisee and promisor as owners of the land
4. notice (actual or constructive)
5. privity (relaxed vertical only for a benefit to run; horizontal and strict vertical for a burden to run)

horizontal privity: the estate and covenant are contained in the same instrument (e.g., the deed).
strict vertical privity: successor must take the original party’s entire interest.
relaxed vertical privity: successor need only take an interest that is carved out of the original party’s estate.

remedy is damages

Question 54

Reqs to bind a successor under an equitable servitude

Answer 54

1) It must be writing. (exception: implied reciprocal servitude)
2) Must have been intended to run with the land
3) Must touch and concern the land: Benefit or burden of the covenant must affect both the promisee and promisor as owners of the land
4) Successor must have notice (actual, record, OR inquiry)

NO privity req.
remedy is injunctive relief

Question 55

reqs for implied reciprocal servitude

Answer 55

1. Must be an intent to create a covenant (i.e., promise) on ALL plots in the subdivision;
2. Must be reciprocal (i.e., benefits and burdens each and every parcel);
3. Must be negative rather than positive (i.e., must be a restriction on owner’s use)
4. Successor must be on notice of the restriction (at least inquiry notice);
5. Must be a common plan or scheme (to prove, look to map of the community showing, advertisements or marketing, or oral or written mention giving notice of the common scheme)

enforceable only by those in same subdivision

Question 56

Changed Circumstances Doctrine under Equitable Servitudes

Answer 56

Look for situations where the restriction no longer makes sense due to drastic changes in the surrounding area since the restriction was put in place.
o Critical question: does the property subject to the restriction still retain some benefit from the restriction?

Question 57

Lateral Support Rights:

Answer 57

Neighboring landowner cannot excavate so as to cause a
cave-in (i.e., subsidence) on a neighbor’s land.
o negligence liability when the actions caused subsidence on a neighbor’s land and the neighbor’s surface buildings ontributed to the subsidence
o strict liability when the actions caused subsidence on a neighbor’s land and the neighbor’s surface buildings did not contribute to the subsidence

Question 58

Subjacent Support Rights

Answer 58

Rights of surface landowners not to have their land subside from the activities of the owners of underground rights
o Owner of the mineral rights is strictly liable for any failure to support the land and any buildings on it that existed before the rights were created.
o Owner of the mineral rights is liable for negligence for damage to any buildings built after the rights were created.

Question 59

Private Nuisance

Answer 59

A substantial and unreasonable interference with another individual’s use or enjoyment of his property

o Substantial: offensive, inconvenient or annoying to an average person in the community (person herself doesn’t have to be annoyed)
o Unreasonable: The injury outweighs the usefulness of the defendant’s actions

Question 60

Public Nuisance:

Answer 60

Unreasonable interference with the health, safety, or property rights of the community.

Private Party can sue only when she shows that she suffered a different kind of harm than the rest of the community