Property Flashcards
Present Estates
- Free Simple Absolute
- Fee Tail
- Defeasible Fees
- Fee Simple Determinable
- Fee Simple Subject to a Condition Subsequent
- Fee Simple Subject to Executory Limitation
- Life Estate
Devisable, Descendible, and Alienable
- Devisable = passable by will
- Descendible = passable by intestacy
- Alienable = passable inter vivos
Fee Simple Absolute
- “To A” or to “A and his heirs”
- Absolute ownership; freely devisable, descendible, and alienable
- No accompanying future interest
Fee Tail
- “To A and the heirs of his body”
- Historically, limited abosolute to literal blood descendents
- Accompanying Future Interest:
- If in Grantor, reversion
- If in 3rd Party, remainder
- Today, Fee Tail abolished and attempt to create creates a Fee Simple Absolute
Fee Simple Determinable
- “To A [durational language, e.g., so long as, during, until] [condition]”
- clear durational language
- If condition is violated, automatic forfeiture
- Devisable, descendible, and alienable subject to the condition
- Accompanying Future Interest = Possibility of Reverter in the Grantor
Fee Simple Subject to Condition Subsequent
- “To A [durational language] [condition] grantor reserves the right to re-enter and retake”
- Clear durational language and state right to re-enter
- If condition occurs, estate not automatically ended, but can be cut short at the grantor’s option
- Devisable, Descendible, and alienable subject to condition
- Accompanying future interest = right of re-entry, aka power of termination, in the grantor
Fee Simple Subject to Executory Limitation
- “To A [durational language] [condition] then to B”
- Upon condition, estate automatically passes to someone other than the grantor
- Devisable, descendible, and alienable subject to condition
- Accompanying Future Interest = Sprining Executory Interest (in 3rd party)
Life Estate
- “To A for Life”
- Measured in terms of an explicit lifetime (not a number of years)
- A is the Life Tenant - Entitled to all ordinary uses and profits from the land, but Cannot Commit Waste
- Future Accompanying Interest: Reversion in Grantor; Remainder in 3rd Party
- Life Estate pur autrie vie - measued by life of another
- “To A for the life of B”
- A has life estate pur autrie vi
Waste
- Voluntary/Affirmative Waste
- overt destruction
- Natural Resources: life tenant must not consume or exploit natural resources unless
- prior use (land previously used for this purpose)
- for repairs or maintanence
- granted the right
- exploitation (land only suitable for this use)
- Permissive Waste or Neglect
- Must maintain property in reasonably good repair
- Ameliorative Waste
- Must not engage in acts that enhance property value unless all future interest holders are known and consent
Future Interests in Grantor
- Possibility of Reverter - accompanies fee simple determinable
- Right of Re-entry (aka power of termination) - accompanies fee simple subject to condition subsequent
- Reversion - accompanies everything else where Grantor transfers less than his full estate (e.g., life estate)
Future Interests in Transferees
- Remainder - patiently wait for preceding estate to end
- Vested
- indefeasibly vested remainder
- vested remainder subject to complete defeasance
- vested remainder subject to open
- Conditional - created in an unascertained person or subject to a condition precedent
- Vested
- Exectory Interest - cut short a preceding estate
- shifting executory interest
- springing executory interest
Contingent Remainders
Remainder is conditional if it is created in an unascertained person or subject to a condition precedent
- subject to a condition precedent: condition that must be satisfied before remainderman takes
- To A for life, then, if B graduates college, to B
Rule of Destructibility
Historically, contingent remainder destroyed if still contingent at the time the preceding estate ended
Today, rule abolished, B or B’s heirs take subject to B’s springing executory interest
The Rule in Shelley’s Case
Historically, “to A for A’s life, then, on A’s death, to A’s heir’s” would merger into a FSA for A under the rule in Shelley’s Case
Today, the rule is abolished
- A has a life estate,
- A’s heirs have a contingent remainder
- O has a reversions, since A could die without heirs
The Doctrine of Worthier Title
Rule applies when O, who is alive, triest to create a future interest in O’s heirs
- To A for life, then to O’s heirs
- under the Doctrine of Worthier Title, O’s heirs’ contingent remainder is void; A has a life estate, and O has a reversion
Three Types of Vested Remainders
- Indefeasibly Vested Remainder
- no strings attached; guaranteed
- Vested Remainder Subject to Complete Defeasance/Total Divestment
- right to possession could be cut short by a condition subsequent - condition that ends an estate;
- “To A for life, remainder to B, provided, however, that if B dies under the age of 25, to C
- A has life estate
- B has vested remainder subjet to complete defeasance
- C has a shifting executory interest
- O has reversion
- Vested Remainder Subject to Open
- Remainder is vested in a group of takers, at least one is qualified to take, but each class members share is subject to parital diminution because additional members can still join
Executory Interests
- Shifting Executory Interest
- divests a transferee’s preceding estate
- Springing Executory Interest
- cut’s short the grantor’s estate
Rule Against Perpetuities
No interest is good unless it must vest, if at all, not later than 21 years after the death of some life in being at the creation of the interest.
OR (stated differently)
No interest will be valid unless it must vest, if at all, within 21 years after the death of some life in being who was alive at the moment the conveyance was made.
Effect: Cross out the violative language.
Rule Against Perpetuities Bright Line Rules
- A gift to an open class that is conditioned on members surviving beyond 21 violates the RAP
- An executory interest with no time limit within which it must vest violates the RAP
Joint Tenancy
- Right of Survivorship (generally, must be express)
- Requires four unities:
- Time
- Title
- Indentical Interest
- Possession (right to possess the whole)
- Severance
- Sale (by either joint tenant, become tenants in common)
- Partiation (by voluntary agreement, can partition in kind or forced sale)
- Mortgage
- Title Theory (minority): One joint tenant’s execution of mortgage or lien severs joint tenancy
- Lein Theory (majority): does not sever
Tenancy by the Entirety
Between married partners with right of survivorship; generally created presumptively on transfer to married partner, but some statutes require express right of survivorship
Tenancy in Common
- Each cotenant owns an undivided part and has a right to possess the whole
- No survivorship rights
Rights and Duties of Co-Tenants
- Possession (to the whole)
- If ouster, owed rent from co-tenant in possession
- Rent from 3rd Parties
- must account to co-tenants, give their fair share
- No adverse possession unless ouster
- Carrying Costs (taxes/mortgage insurance) - based on undivided share owned
- Repairs
- Repaiging co-tenant has a right to contribution for reasonably necessary repairs provided she informed other co-tenants of the need
- Improvements
- No right to contribution for improvements
- Waste - must not waste
- Partition - to dissolve relationship (in kind or forced sale)
Leasehold Estates
- Tenancy for Years: Lease for any fixed period; no notice required to terminate
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Periodic Tenancy: Lease that continues for successive intervals
- created expressly, by implication, or by holdover
- Implication: no mention of duration but payment made at set intervals
- Implication: Oral term of years in violation of SoF, measured by way rent is tendered
- Require notice (usually equal to a period) to terminate
- Must end at conclusion of a natural lease period
- created expressly, by implication, or by holdover
- Tenancy at Will: no fixed duration, terminate at any time
- Tenancy at Sufferance: Wrongful holdover, allows L to recover rent
Tenant’s Duties
- Liability to Third Parties (Tort)
- Must keep property in good repair
- T liable to all invited third parties, even if L promised to repair
- Duty to Repair
- Tenant must maintain and make routine repairs, other than those due to odrinary wear and tear
- Tenant must not commit waste
- Law of Fixtures: T must not remove a fixture, even if she installed (voluntary waste)
- Duty to Pay Rent
- If T breaches and is in possession, landlord’s only options are to
- evict throught the court or
- sue for rent due
- If T breaches but is not in possession, L can
- treat as T’s surrender of lease,
- Ignore abandonment, and hold liable for unpaid rent (in a minority of states), or
- relet the property and hold T liable for deficiency
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- If T breaches and is in possession, landlord’s only options are to
Landlord’s Duties
- Duty to Deliver Possession
- Implied Covenant of Quiet Enjoyment
- applies to residential and commercial
- breached by wronful eviction/exclusion
- breached by constructive eviction
- substantial interference
- notice by T
- T must vacate
- Implied Warranty of Habitability
- Must be fit for basic human dwelling, bare living requirements must be met; often set by statute, building code
- T’s remedies for breach:
- Move out, end lease
- Repair and deduct (where allowed)
- Reduce rent (place in escrow, good faith)
- Remain, pay rent, and seek money damages
Assignments and Subleases
- Assignment:
- L and T1: privity of contract (secondarily liable to each other)
- L and T2: privity of estate
- liable for covenants that run with the land
- Sublease
- L and T2 are without privity
- L and T1 relationship fully intact
Landlord’s Tort Liability
Under common law, the Landlord was under no duty to make the premises safe (caveat lessee), however, there are a number of common exception:
- Must maintain common areas
- Must warn of hidden defects that are known (or should have been known) to landlord
- Must complete any assumed repairs reasonalby
- Public use rule: liable in short term leases of public space
- Short term lease of furnished dwelling: liable for any defect which proximately harmed T
Easement
Grant of a non-possessory property interest taht entitles its holder to some form of use or enjoyment of another’s land (called the servient tenement)
- Appurtenant
- benefits another’s land (the dominant tenement)
- benefit passes automatically with dominant land (even without notice)
- burden passes with servient land, exception to a bona fide purchaser without notice
- In Gross
- provides a personal or pecuniary benefit (no dominant tenement)
- not transferrable unless for comercial purposes
Creation of an Affirmative Easement
- By grant
- an easement to endure for more than 1 year must be in writing satisfying requirements of a deed (bc SoF)
- By implication
- Implied from existing use
- previous use was apparent
- parties expected it would continue because reasonably necessary to use of the property
- By necessity
- By Prescription (Adverse Possession)
- Continuous for statutory period
- Open and Notorious
- Actual (need not be exclusive)
- Hostile (without consent)
Termination of an Easement
- Estoppel - servient owner materially changes positon in reasonable reliance on easement holder’s assurance it will not be enforced
- Necessity ends
- Destruction of Servient Land
- Condemenation of Servient Land (eminent domain)
- Written Release
- Abandonment - easement holder must demonstrate by phsyical action intent to never use the easement again
- Merger - servient and dominant lands merge to common onwer
- Prescription - extinguish an easement by prescription by interfereing with elements of adverse possession
License
A mere privilege to enter the land of another for a designated purpose
not subject to SoF
Freely revocable, unless estoppel applies
Covenant
A contractual limitation or promise regarding land (generally restrictive, but can be affirmative)
For a covenant - plaintiff seeks legal damages (money)
For a burden to run with the land:
- Writing
- Intended to Run
- Touch and Concern the Land
- Horizontal (Original Parties in succession of estate) and Vertical Privity
For a benefit to run with the land:
- Writing
- Intended to Run
- Touch and Concern the Land
- Vertical Privity
Equitable Servitudes
A promise related to land that equity will enforce. It is accompanied by injunctive releif.
Requirements to bind successors:
- Writing
- Intent to bind successors
- Touch and Concern the Land
- Notice (successors had notice of equitable servitude)
Implied Equitable Servitude
- If subdivider had a general and common scheme of residual development that included lot in question
- And buyer of lot in question had notice (any type) of the promise the prior deeds
- Then the courts will impose the negative restrictive covenant
Equitable Defenses to Enforcement of Equitable Servitude = changed conditions so pervasive that the entire area has changed
Adverse Possession
Possession can ripen into title
- Continuous (for the statutory period)
- Open and Notorious
- Actual Entry, giving exclusive possession
- Hostile (wihtout consent)
Taking
- Tacking of two adverse possessors claims together is permitted if they are in privity
Conveyance of Real Estate
- Land Contract - Transfers Equitable Title
- Contract endures until step 2
- Closing - Transfers Legal Title
- Deed becomes operative document
Land Contract
Must satsify SoF (in writing, signed by party to be bound, describe the property, and state some consideration)
- Exception: Doctrine of Part Performance
- No need for writing if any two of the following three:
- possession
- improvements (substantial)
- payment (all or part)
- No need for writing if any two of the following three:
Buyer now bears the risk of loss
Implied promises in land contract:
- seller promises to provide marketable title at closing
- free from reasoanble doubt and threat of litigation
- seller promises not to make any false statements of material fact
- generally now liable for failing to disclose latent material defects
Otherwise, Caveat Emptor
- Except an implied warranty of fitness and workmanlike construction applies to the sale of a new home by a builder-vendor
Closing
Deed passes legal title from S to B.
Requirements
- Lawful Execution of a Deed
- Be in writing (need not cite consideration)
- Description (unambiguous and provide a good lead)
- Delivery
- physical delivery or Grantor’s present intent to be bound
- Express rejection defeats delivery
- Delivery by Escrow
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Types of Deeds (and covenants therein)
- Quitclaim
- no covenants
- General Warranty Deed
- warrants against all defects in title on behalf of grantor and all grantor’s predecessors
- Present covenants
- seisin (promise that grantor owns)
- right to convey
- against encumberances
- Future covenants
- covenant of quiet enjoyment
- covenant of warranty (promise to defend)
- covenant for further assurances
- Present covenants
- warrants against all defects in title on behalf of grantor and all grantor’s predecessors
- Statutory Special Warranty Deed
- Provided by statute in many states; grantor warrants only that he
- has not conveyed to anyone else and
- property is free from encumberances made by grantor
- Provided by statute in many states; grantor warrants only that he
Recording System and Statutes
Recording statutes provide protection to bona fide purchasers (buys for consideration without notice of another buyer) and mortgagees
- Notice Statute: Last BFP to take wins (regardless of whether he records)
- Race-Notice: to prevail, BFP must record first
Forms of Notice
- Actual
- Inquiry
- on notice of whater an exam of the land would show
- Record
Shelter Rule
One who takes from a BFP will prevail against any entity the transferor-BFP would have prevailed against
- even if he had notice
Problem of the Wild Deed
A deed unconnected to the chain of title is wild and incapable of giving record notice
Estoppel by Deed
One who conveys realty in which he has no interest is later estopped from denying the validity of that conveyance if he later acquires the previously transferred interest
Mortgage
The conveyance of a security interest in land, intended by the parties to be collateral for the repayment of a debt
- debtor = mortgagor
- creditor = mortgagee
- Purchase Money Mortgage vs. Non-PMM
- Equitable Mortgage (parties intended mortgage)
- Can be enforceable between Creditor and O
- parol evidence can be used to show intent
- Can be enforceable between Creditor and O
Transferring Mortgage Interests
All parties can transfer their interests. Mortgage automatically follows a properly transferred note.
The creditor-mortgagee can transfer his interest by:
- endorsing the note and delivery to transferee, OR
- executing a second document of assignment
If transferee receives an endorsed and assigned note, he can become a holder in due course, free from any personal defenses that could have been raised against the creditor-mortgagee
Holder in due course still subject to real defenses
- material alteration
- duress
- fraud in facturm
- incapacity
- illegality
- infancy
- insolvency
To be a holder in due course:
- note must be negotiable, made payable to named mortgagee
- endored by named mortgagee
- original note must be delivered to the transferee (no photocopy)
- transferee must take in good faith
- transferee must pay value for the note
Foreclosure
Judicial action for a forced sale
If sale proceeds deficient, can bring a deficiency action against debtor
If surplus, proceed as follows:
- pay forclosure expenses
- mortgages in order of priority (each paied in full)
- Purchase Money Mortgages have super priority in land they financed
- surplus to debtor
Redemption
- Redemption in Equity - at any time up to date of sale
- by paying missed payments and costs
- right to redemption is not waivable
- Statutory redemption
- recognized in about 1/2 the states
- can redeem for a period after foreclosure
Lateral Support
If improved land caves in due to exavation on neighboring land, exavator liable if negligent
Strict liability attaches only if plantiff’s improved land would have collapsed in unimproved state
Water Rights
- Riparian
- water belongs to property that borders water,
- may use as long as you do not unreasonably interfere with others use
- Prior Appropriation
- rights by priority (first to use beneficially)
Groundwater - surface owner entitled to reasonable use that is not wasteful
Surface Water - Common enemy rule - may combat flow of surface water, but can’t cause unnecessary harm to other’s land
Zoning
Pursuant to its police powers, the government may enact statutes to reasonably control land use
- Variance: must show undue hardship and grant of variance will not work dimimution to neighboring property
- Nonconforming Use: grandfather in; previously lawful use cannot be eliminated all at once unless just compensation paid, otherwise it would be an unconstitutional taking
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Cumulative Zoning vs Non-Cumulative
- in cumulative, zones are prioritized, land can be put to any use of it’s zone or higher priority zones
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Unconstitutional Exactions:
- exaction must be reasonably related in nature and scope ot the impact of the proposal
