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Common MBE Errors > Property > Flashcards

Property Flashcards

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1
Q

Fee Simple Determinable

A
  • Future Interest that holds “so long as” or “during”
  • Grantor has a Possibility of Reversion, meaning the interest will automatically go back to him once the condition stops being met
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2
Q

Fee Simple Subject to Condition Subsequent

A
  • Future Interest in someone that can kick back to the Grantor if a certain condition takes place after the conveyance
  • “To B, but if she doesn’t marry by 2001, back to me”
  • Grantor has a Right of Reentry, meaning he has to take action to go back in and get the interest back
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3
Q

Fee Simple Subject to an Executory Interest

A
  • Future interest in someone that can kick back to a third party if a certain condition takes place after the conveyance
  • “To B, but if she doesn’t marry by 2001, back to me”
  • Difference with the above is that this will automatically go to the third-party if the condition isn’t met (rather than with the Grantor above, who who would have to reenter)
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4
Q

What is not a clear and durational conveyance?

A
  • “Subject to the understanding”

- “In the hope that”

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5
Q

Can an interest be granted to one life tenant and then to another?

A

If an owner conveys a life estate to someone, no subsequent act of the owner will affect that first person’s life estate. The holder of the second life estate will have to wait for the first one to die, and then it will go to him.

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6
Q

Can a Life Tenant lease out their interest?

A

Yes, but the person they lease it out to will only have it for the duration of that Life Tenant’s life. Unless of course, they find a way to Adversely Possess it.

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7
Q

Affirmative Waste

A

A Life Tenant is not allowed to commit Affirmative Waste, such as taking natural resources from the land (unless it was done before, “Open Mines Doctrine”). Affirmative Waste also includes Life Tenant’s obligation to pay rent or mortgage (obligated to pay interest of the mortgage – principal goes to future interest holders, or remaindermen).

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8
Q

Permissive Waste

A

A Life Tenant is not allowed to commit Permissive Waste, or cause harm or neglect to come to the property.

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9
Q

Ameliorative Waste

A

Life Tenant’s repair of property could count as Ameliorative Waste of they add value to the property.

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10
Q

Difference between a Remainder and an Executory Interest?

A

Remainder - certain to vest immediately after the termination of the preceding estate
Executory Interest - there’s a possibility that it will never vest (if a condition isn’t met)

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11
Q

Vested Remainders

A

Vested Remainders automatically become possessory when the preceding estate expires

Types:
(1) Indefeasibly Vested Remainders - goes straight to the remainderman after the prior estate terminates

(2) Vested Remainder Subject to Total Divestment - goes straight to the remainderman after the prior estate terminates, unless he fucks up, then it will go to someone else
(3) Vested Remainder Subject to Open - an interest that goes straight to at least 1 surviving class member of a class that can expand over time (must be at least 1, or it’ll be a Contingent Remainder)

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12
Q

Contingent Remainders

A

Contingent Remainders only become possessory if triggered by some preceding condition (or if some unborn or unascertained person is suddenly born)

(1) Contingent Remainder Subject to Condition Precedent - goes to person automatically once a preceding event or condition has occurred
(2) Contingent Remainder Subject to Unborn or Unascertained Persons - goes to B’s heirs, but that’s contingent on those heirs actually being born (cannot be ascertained at the time of conveyance, only when B will die; class is unascertained right now)

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13
Q

Rule of Destructibility (to 3rd party if condition is met)
(Grantor = Reversion)
(Third-Party = Springing Executory Interest)

A

A contingent remainder is destroyed if the preceding condition still isn’t satisfied when the prior estate ends
- If the condition isn’t satisfied, the interest will go back to the Grantor (Reversion) and to the future party if condition is met (Springing Executory Interest)

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14
Q

Shelley’s Rule (to Life Tenant’s Heirs)
(Life Estate)
(Life Tenant’s Heirs = Contingent Remainder)
(Grantor = Reversion)

A

Granting someone a Life Estate, and a future interest to the Life Tenant’s heirs

  • A has a Life Estate
  • A’s Heirs have a Contingent Remainder
  • Grantor has a Reversion, if A dies without heirs
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15
Q

Doctrine of Worthier Title (to Grantor’s Heirs)
(Life Estate)
(Grantor = Reversion)

A

Grantor creates a Life Estate in one person and creates a future interest in the Grantor’s heirs
- After Life Tenant dies, the Grantor will have a Reversion

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16
Q

Springing Executory Interest

A

Cuts short the Grantor’s interest when it goes to a different party

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17
Q

Shifting Executory Interest

A

Cuts short someone else’s interest when it goes to a different party

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18
Q

Tenants In Common (presumed estate in land)

A
  • Each TIC owns a distinct, undivided interest
  • If one TIC leaves, you have to make sure they give up ownership too; it’s not enough just to give up possession (they’ll still have rights)
  • No right of survivorship; can devise it, can lease it out
  • How do destroy a TIC? Partition (forced sale) of an interest so another TIC can take sole ownership of his share in the estate, while the remaining parties hold their interests as TICs; can be Voluntary or Involuntary
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19
Q

Joint Tenants

A

Requirements: Unity in (1) Time; (2) Title; (3) Instrument; and (4) Possession

  • Their must be clear intent by the Grantor to create a Joint Tenancy
  • Right of Survivorship if one of them dies
  • Cannot be devised through will (if attempted, it’ll just stay with the Joint Tenant)
  • How do you destroy a JT? Mutual Agreement to terminate; 1 LT murders another LT; both JTs die simultaneously; or Partition (Voluntary or Involuntary)
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20
Q

Tenancy by the Entirety (like Joint Tenancy but for marriage)

A
  • Right of Survivorship to surviving spouse
  • Married Joint Tenants protected from Single Creditor (but not Joint Creditor)
  • Severance through Mutual Agreement; Divorce Decree; Joint Creditor Forecloses; One spouse dies
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21
Q

Two Joint Tenants but 1 has a mortgage interest against his share. What happens?

A

The Joint Tenancy will be severed at the Foreclosure sale. But if the 1 Joint Tenant dies before the Foreclosure (before judgment is enforced), the lien will be extinguished.

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22
Q

Tenancy for Years

A
  • For a fixed duration and a clear start date
  • Ends automatically after time specified (no notice needed)
  • Doesn’t have to be in writing unless it’s for 1 year
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23
Q

Periodic Tenancy

A
  • Tenancy repeats again and again (month-to-month)
  • Notice is required to end it (usually a month ahead of time)
  • No Express Agreement or writing necessary
  • How to create it: (1) Express Agreement; (2) Implied Agreement; (3) Holdover Tenant situation
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24
Q

Tenancy at Will

A
  • A tenancy with no fixed duration that is terminable by either party at any time without notice
  • How to create it: Express Agreement ONLY
25
Q

Tenancy at Sufferance

A

Holdover Tenant situation
- Landlord can evict him, or sue him for rent, or start a new Periodic Tenancy with him (cannot forcibly remove his things, and new Periodic Tenancy has to be reasonable)

26
Q

Fixtures

A
  • Once-movable fixtures we attach to real property for the PURPOSE of PERMANENTLY IMPROVING that property
  • When can you remove a fixture?
    (1) If there’s NO EXPRESS AGREEMENT THAT IT STAYS and it was put there for the exclusive benefit of the tenant
    (2) If its removal would cause NO SUBSTANTIAL HARM TO PROPERTY
    (3) If there’s an AGREEMENT FOR REMOVAL that you’re allowed to take it when you leave
27
Q

Implied Covenant of Quiet Enjoyment (Residence + Business)

A

A tenant has an implied right to quiet use and enjoyment of the premises, without interference from the landlord. If there’s a breach:

(1) Tenant must INFORM the landlord and give him a reasonable opportunity to repair; and
(2) Tenant must VACATE the premises within a reasonable period if the landlord fails to repair

28
Q

Implied Warranty of Habitability (Residence ONLY)

A

A residential property must be fit for basic human dwelling. If the landlord breaches:

(1) Tenant can either leave or remain on the premises (no obligation to stay there)
(2) Make reasonable repairs or deduct costs of repair from rent payment
(3) Withhold or reduce rent until court resolves this issue (but rent payments have to be placed in escrow)
(4) Can terminate the lease and leave

29
Q

If a Tenant rents out their apartment to a Subleasee, but the Tenant forgets to pay the share to the Landlord, is the Subleasee liable?

A

No. Not liable to the Landlord for rent and not bound by any covenants unless they expressly assumed the ones in the lease. Only the Tenant is in privity-of-estate with the Landlord; the Subleasee has no privity with the Landlord.

30
Q

Express Easements

A

(1) Express Easement by Reservation - reserved by the Grantor only for himself
(2) Express Easement by Grant - owner of the servient estate gives an easement to the owner of the dominant estate
- Both must be in writing or they will violate SOF and
- Signed by servient estate holder

31
Q

Prescriptive Easement

A

Acquire it through use that is:

(1) Continuous
(2) Open and Notorious
(3) Actual; and
(4) Hostile

32
Q

Licensee

A

Someone who has NO property interest, just has a right or PRIVILEGE to use the owner’s property and this can be revoked at any time
- To get a Buyer who has already conveyed the property at closing off the land, you should argue that he’s a mere Licensee so he has no right to be there

33
Q

Adverse Possession Elements

A

(1) Continuous for statutory period (10 years usually)
(2) Open and Notorious
(3) Actual and Exclusive
(4) Hostile

“Color of Title” - if you get Adverse Possession for part of the property, you’ll get Adverse Possession for all of it

34
Q

Tacking Adverse Possession

A
  • Each user must come after the other (no gaps!)
  • Each user must have privity (devises it, for instance)
  • There can be two concurrent owners under Adverse Possession
35
Q

Requirements for a Valid Land Sale Contract

A
  • Must be in writing (email is okay)
  • Identifies parties
  • Signed
  • Describes the land and price
36
Q

Equitable Conversion

A

Buyer owns legal title of the property after signing at closing and before conveyance; Seller owns personal title to the property – usually, the Buyer will be liable for any risk of loss

37
Q

To Sell Land, Title Must be Marketable

A

Basically a promise that the title is free from the risk of litigation

When is it Unmarketable?

(1) Adverse Possession acquired it
(2) Zoning violation (but building code violation is fine)
(3) Lien on the property (must be satisfied by closing!)

38
Q

No Material Misrepresentations Allowed to Sell Property (but Specific Disclaimers can be made)

A

Disclaimer selling house “as is” is allowed as long as it is clear and specific, and there is no material misrepresentation of facts or false statements concerning the property

39
Q

Bona Fide Purchaser for Value (BFP)

A

Must purchase property for value and give consideration for it without notice of a prior conveyance (not a Creditor)
- Does not include donees, heirs, or devisees (because no consideration was paid)

40
Q

Which recording statutes protect BFPs?

A
  1. Notice statute - a BFP without Notice of prior conveyance wins
  2. Race-Notice statute - a BFP without Notice of prior conveyance, who recorded first, wins
  3. Race statute - a BFP who records first wins
41
Q

How does someone have notice of a prior conveyance?

A
  1. Actual Notice - from any source
  2. Inquiry Notice - notice after a reasonable inspection of the land
  3. Record Notice - notice from doing a routine title search
42
Q

Can you a buy a house from someone who doesn’t own it yet?

A

Yes, under “Estoppel by Deed” remedy. The person just has to own it within a reasonable time after closing.

43
Q

Can you a buy a house from someone who will own it only upon a certain condition?

A

Not until that future interest is triggered by the condition.

44
Q

When either party refuses to close (Specific Performance time!)

A

IF BUYER REFUSES TO CLOSE - Seller can compel them to through Specific Performance on the contract, even if the Buyer never actually recorded

IF SELLER REFUSES TO CLOSE - If the Buyer paid, the court will compel the Seller to convey title through Specific Performance

45
Q

When is a Buyer responsible for a mortgage debt?

A

Only if they “assume the mortgage debt,” then they will be primarily and personally liable for the debt if it isn’t satisfied after the foreclosure.

If they just take an interest “subject to mortgage debt,” then the Buyer is not personally liable for what is still due after the foreclosure sale.

46
Q

Do courts prefer “Partition by Sale” (division of the proceeds) or “Partition in Kind” (the physical division of the land)?

A

Courts prefer “Partition in Kind.” They will only resort to “Partition by Sale” when it is impossible to come up with a fair and equitable Partition in Kind, like in our example where a zoning ordinance prevents the Tenants in Common, a brother and sister, from splitting the land equitably (zoning ordinance says you can’t have less than an acre of land, etc.)

47
Q

Can’t file an injunction against an easement-holder when there’s still a valid easement. An easement is still valid and enforced unless it has been Abandoned, but abandonment requires more than mere “non-use” of the easement for 40 years.

A
  1. Written Release by easement-holder
  2. Abandoned by easement-holder
  3. Adverse use by someone else for statutory period
  4. Estoppel

Abandonment requires more than mere “non-use” for 40 years. There must be acts indicating a clear intent to abandon (like filling up the space, removal of what was used, etc.) Without that, the easement-holder will still have full rights to the easement. And the purchaser has constructive notice of the easement since it appears on the chain of title and was recorded (even if not on the Deed itself).

48
Q

What’s the difference between Lapse and Ademption? For instance, Wally leaves a red ferrari to June but June dies before Wally does.

A

Because June died before Wally, the gift LAPSES.

Lapse - a gift lapses when it was bequested in a will to someone who predeceases the testator. An anti-lapse statute will provide a “substitute” taker for the bequest, but if there’s no statute, there’s no statute, and whoever was supposed to get the rest of the estate in residue will get this gift.

Ademption - occurs when the object of a specific bequest is no longer in the testator’s estate when he dies. This would mean that the red ferrari is no longer in Wally’s estate when he died, maybe because he sold it to someone else.

49
Q

Easement by Necessity

A

An easement by necessity is established if (1) the lots were once under common ownership; (2) the easement by necessity existed because of the conveyance of one lot that served the common ownership; and (3) the servient lot is completely landlocked.

50
Q

Duty to Deliver Marketable Title

A

A seller is obligated to convey a title free from any liens or encumbrances. They must convey marketable title (or clear the title) by closing or within a reasonable time thereafter.

But if the contract has a “Time of the Essence” clause, failure to convey marketable title by the time stated will be considered as a MATERIAL BREACH. These clauses are strictly enforced and actionable.

51
Q

Requirements to gift real property:

A

(1) Intent to make the gift + (2) Delivery of the deed

52
Q

Periodic Tenancy

A

A tenancy renewed automatically at the end of each specified “period.” It is an implied Periodic Tenancy if no duration for the lease is provided. It can be terminated through giving notice equivalent to the length of the period at issue. If it’s a month-to-month lease, a month’s notice must be given; a week-to-week requires a week’s lease. But if the period is a year or longer, six months’ notice will be required.

53
Q

Can you terminate a Joint Tenancy with a Partition in Kind?

A

Sure, a JT can be terminated by a Partition in Kind where two JTs agree to do whatever they want with separate parts of the property. The Partition in Kind must be in writing to satisfy Statute of Frauds (because it’s a Real Property interest). If not in writing, look for estoppel or reliance.

54
Q

Easements destroyed by Merger

A

An easement is extinguished when the Easement Holder is conveyed the entire property (even without taking actual possession). The Easement Holder and the Servient Landowner are now the same person, extinguishing the easement. It cannot be revived.

55
Q

Easement Renders Title Unmarketable and Can’t Be Cured by Foreclosure

A

An easement renders a title unmarketable, especially if it benefits a neighbor rather than the landowner. In contrast, a mortgage makes a title unmarketable too, but it can be cured at closing through the proceeds of the sale. Buyer can refuse to close if there’s still an easement on the property, because the title is unmarketable.

56
Q

Modifications of Senior Mortgages

A

If a senior mortgage’s modification alters its interest rate or increases the principal amount, it will give the junior mortgage priority because it constitutes a “material modification” that is detrimental to the junior lender’s interest.

57
Q

Deed in Lieu of Foreclosure

A

Borrower can request that the lender accept a deed in lieu of foreclosure, as long as both sides agree and it is reasonable under the circumstances.

58
Q

Disguised Mortgage

A

Borrower who needs to raise money may sell his land to someone who leases it out to him for a longer period of time until the money can be raised.

59
Q

Mortgage Clauses on Prepayments and Fees

A

Mortgage agreements may dictate prohibitions on prepayments and prepayment fees and are enforceable. If the mortgage does not provide for a prepayment, the borrower has no right to it.

Common MBE Errors (7 decks)

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