Property Add-ons Flashcards
Negotiable promissory note
CAN be transferred by endorsing and delivering note to another
What happens when tenancy in common is deeded to non-existent (e.g. dead) tenant?
Deed is void as to THAT co-tenant, grantor retains that co-tenant’s interest
BUT other parties to deed can retain their own interests
Nonnegotiable promissory note
Requires document of assignment in order to transfer
Are vested or contingent remainders transferrable?
YES, both are transferrable during grantee’s lifetime, devisable by will, and inheritable through intestate succession
Under riparian rights theory, are domestic and commercial use viewed differently?
Yes, domestic (natural) use has priority over commercial (artificial) use
Does ‘coming to the nuisance’ bar a nuisance claim?
No, but will be considered by court and likely count against the claim
May multiple people be simultaneous adverse possessors?
YES, they can acquire concurrent ownership as tenants in common
May a mortgagee take over property if mortgagor abandons it?
YES, but once in possession, mortgagee incurs liability as if he were the owner
Does K for real property without closing date satisfy statute of frauds?
YES, closing date is not essential term, so K still binding
If a restrictive covenant is unlawful (e.g. discriminatory), but does not impact the buyer of the home, does this violate the implied convenant of marketable title?
YES, bc still creates unreasonable risk of litigation even if the buyer does not intend to litigate
If one party holds title to property, but other party is still in possession, who bears risk of loss?
Under doctrine of equitable conversion, party with TITLE (obtained when K of sale executed) bears risk of loss, EVEN IF other party still in possession
Do recording acts protect donees of property or only purchasers for value?
BOTH–doesn’t matter if for value or not
If mortgagor is up to date on payments, but there are serious defects to property, must mortgagor repair them?
YES, if it impairs mortgagee’s security interest in the property
Doctrine of part performance
Can be asserted by either party to land sale to compel specific performance
Part performance can be shown to satisfy statute of frauds when 1) a party pays in full or part, 2) possesses property, or 3) improves property
Is party in breach if condition precedent not met?
NO, condition precedent must be satisfied for contracting to occur
If junior mortagee is purchaser of foreclosed property, what happens to all other mortgages?
ALL mortgages, including the mortgage being foreclosed and all other junior mortgages, are EXTINGUISHED
May holder of a future interest inspect property for waste?
YES, he has LICENSE to do so
Is seller’s subjective intent relevant to evaluation of whether fixtures can be removed?
NO, only objective intent
Can judgment creditors enforce interest in property sold by debtor to third party?
NO, only in properties owned by debtors
Attornment
When a tenant accepts a new landlord in place of an old one
Under attornment, does new landlord become liable for latent defects in property?
NO, former landlord is liable until new landlord had reasonable opportunity to discover and take precautions
Doctrine of changed circumstances/changed conditions
Prevents enforcement of real covenant or equitable servitude that no longer provides INTENDED BENEFIT
If a common scheme is created after some of lots are conveyed with no restrictions, can later restrictions be retroactively imposed on those lots?
NO, if not included in deed, cannot retroactively apply, and cannot be forcefully incorporated into scheme
Can an express easement for a term of years be terminated by prescription if the servient estate owner does not comply with requirements?
YES, even if easement is express and for set period of time, servient estate can terminate easement by acting inconsistently with its continued existence
Does due-on-sale clause apply only to BFPs, or also gifts of property?
GIFTS–does not have to be for value, any kind of transfer okay
Title insurance owner’s policy
Remains in effect as long as property is owned by insured OR conveyed by warranty deed
Title insurance lender’s policy
Ends once mortgage is discharged
When does a purchaser receive title to property?
Under doctrine of equitable conversion, AT TIME K IS ENTERED
What does equitable title do?
Gives purchaser right to obtain full ownership of property upon closing
Is an earnest money (buyer to show good faith to complete transaction) usually enforceable to collect?
Yes, usually constitutes liquidated damages, so enforceable when buyer breaches UNLESS they are penalty
Is a broker entitled to commission when seller enters K even if buyer backs out of sale or it doesn’t close?
YES, so long as he enters ready willing and able and contracting occurs
For purposes of listing agreements, when does sale occur?
When a seller ENTERS INTO SALES CONTRACT (not at closing)
Fee tail estate definition and language
Lasts until original grantee’s lineage dies out
“to A and the heirs of his body”
Now abolished almost everywhere, usually means FEE SIMPLE ABSOLUTE
Under doctrine of equitable conversion, which party has risk of loss?
Party with EQUITABLE TITLE to property, even if not in possession
Does covenant of warranty protect against all claims made against grantee’s title?
NO, only successful claims (no right to recover expenses incurred to defend UNSUCCESSFUL claims)
May a tenant in common lease his portion without other co-tenants’ consent?
YES, but other co-tenants can share possession and may share rental income
In J&S liability jdx, are original tenant, sublessee, or both parties liable for rent for lease term?
BOTH, landlord can recover from either
May a buyer of property assign her contract for sale to a third party?
YES, so long as assignment does not materially change obligor’s duty/risk
or materially impair or reduce obligor’s chance of obtaining return performance
Property sales K: rights of assignee
Third party assignee can then enforce contract to same extent as buyer
If a seller has been in adverse possession for statutory minimum, and thus may rightly claim property, does this satisfy requirement for marketable title?
NO, title through adverse possession is unmarketable UNLESS it has already been quieted
When may extrinsic evidence be introduced to identify testator’s intent?
Only when a will has significant ambiguities
Otherwise it would violate parol evidence role to introduce contradictory material
May a landlord evict a sublessee from property even though they are not in privity?
YES, though original tenant liable for rent, if payments are not being received, owner can reclaim possession (though sublessee still not liable for rent)
Is an oral condition not mentioned in deed enforceable?
NO, NOT enforceable if not included in deed
(NOTE: for non-deed Ks, condition subsequent is ADMISSIBLE under parol evidence rule)
What notice to subsequent purchasers is necessary for equitable servitude to continue?
ANY notice (actual, record, or inquiry)
If deed to property given to Person 1 subject to executory limitation, but Person 2 is heir to all property in will, does will extinguish Person 1’s interest?
NO, the deed is still valid and will pass if executory limitation occurs
Short sale
When lender agrees to release lien on property in exchange for sale of property to third party
Can a city or state entity acquire land through adverse possession, or just private parties?
ALL may, including city or state
If an easement is granted to a particular person rather than a property, is it an easement in gross?
ONLY IF it is granted EXCLUSIVELY to one person. If heirs/assigns or any others included, it is easement appurtenant
DEFAULT ASSUMPTION = easement appurtenant
Must cotenants pay mortgage ? May they collect from one another?
Yes, they MUST pay mortgage
If they pay more than their fair share, they can SEEK CONTRIBUTION from other co-tenants
Does a restrictive covenant render title unmarketable
YES, e.g. no commercial use
What happens when property is deeded to non-existent grantee, and no other parties?
The deed is void as to that grantee and thus deed is COMPLETELY invalid
(if other parties are included in deed, deed is void as to nonexistent grantee but still valid as to other grantees)
Do buyers have duty to search for wild deeds?
Courts are DIVIDED–depends on whether jdx imposes duty to do so
If a forged deed is later relied upon by BFP, does it convey title?
NO, deed is void!
Fixture v chattel: what can seller remove?
Chattel okay
Fixture (attached to real property) NOT okay
Can a hardship variant be granted if hardship was self-imposed?
NO
If there are 3 joint tenants, and one joint tenant sells his share to another joint tenant, does that 1/3 share merge with joint share or turn into tenancy in common?
It becomes TENANCY IN COMMON and does not merge into joint tenancy
If buyer is ready/willing/able to enter K, but wants to add condition that seller refuses to, does this entitle real estate agent to commission?
NO, because attempting to add a term means that buyer was not willing to comply with seller’s terms, and thus does not meet standard for buyer
Spot zoning
Arbitrary discrimination for or against owner of rezoned property
When rezoning affects small number of parcels and is INCONSISTENT with neighborhood/comprehensive plan AND usually benefits one owner to detriment of others
EXCEPTION: can spot zone for PUBLIC PURPOSE
Variance v. spot zoning
Variance = RELIEF for one parcel due to hardship (legal)
Spot zoning = CHANGING underlying zoning regulation for specific parcel (illegal)
Cumulative zoning
Allows higher use in lower zone
(e.g. family home can be in industrial zone, but not inverse)
When may nonconforming use continue?
It lasts until 1) owner enlarges/changes/abandons use OR
2) if provided in zoning law, amortization or registration period has passed
Hierarchy of foreclosure sale distribution
1) expenses
2) mortgage being foreclosed
3) junior liens, in order of priority
4) debtor, if surplus remains
If a party obtains title to land by adverse possession, and then orally disclaims rights and tells original owner they can have land, who has title?
STILL the adverse possessor–the oral statement is insufficient bc NOT signed in compliance with statute of frauds
May a tenant sue to cancel lease if it appears that premises will soon be unavailable due to e.g. foreclosure?
NO, anticipatory repudiation – if no one actually ejects them from premises, no action can be taken
Equitable conversion doctrine exception?
BUYER is liable for loss incurred after execution of K UNLESS loss is attributable to INTENTIONAL or NEGLIGENT acts of SELLER
Valid death escrow
1) deed given to escrow agent with instructions to transfer to grantee upon grantor’s death AND 2) grantee RELINQUISHES right to take deed back (irrevocable)
Can easement by necessity be defeated if another landowner offers easement on their property?
NO, easement implied if it existed before property merger
Are owner-occupied dwellings subject to any FHA guidelines?
No, but EXCEPTION: cannot make ADVERTISEMENTS that state preference for PROTECTED CLASS
When does tenancy for years terminate?
AUTOMATICALLY at end of lease, even if tenant owes rent
When mortgage is expressly assumed, is initial debtor still liable?
YES, SECONDARILY liable (assignee is liable first)
If a deed is recorded + attorney is ordered to deliver it, but later facts (e.g. falling out) indicate that grantor has contrary interest, is deed valid?
NO, expectation for delivery is rebuttable based on extrinsic evidence/facts to contrary
If lender forecloses house but there is no acceleration clause, is entire loan owed?
NO, only amount of balance currently overdue
Can a person report a neighbor in property development for violating ordinance if it is NOT nuisance to neighbor?
YES, still allowed
What are limits on restrictions imposed by HOA?
Almost always enforceable (even if arbitrary/capricious) BUT NOT IF illegal, unconstitutional, or against public policy
Must 1) grantee 2) grantor or 3) both sign deed
JUST GRANTOR
When is deed treated as equitable mortgage?
When deed is given to creditor upon agreement to RECONVEY back to debtor after debt settled
When must special use permit be granted?
When property owner COMPLIES WITH PROCEDURES and has established entitlement, NO basis for DISCRETION, MUST GRANT
In partition sale of co-tenancy, what do creditors have rights to if they 1) are party 2) are not party?
If creditor is party: Lien attaches to SALE PROCEEDS
If creditor is not party: Lien attaches to INTEREST IN PROPERTY
Does a quitclaim deed with no warranty still come with covenant of marketable title?
YES, applies to all unless waived by owner
When does outstanding mortgage NOT constitute encumbrance?
When mortgage is LESS THAN selling price and seller can apply proceeds to PAY OFF mortgage and remove encumbrance
If dominant estate holder of easement appurtenant acquires another estate, may the new estate also use the easement?
NO, this impermissibly increases scope/defies existing easement
Condo owners obligations for damages in common area?
liable only for ASSOCIATION expenses, not personally liable
Standard for when a landlord may refuse to assign a lease when agreement is silent on matter?
any REASONABLE GROUND not based on prejudice
What is required for surrender of premises back to landlord?
when tenant RETURNS lease to landlord and he ACCEPTS–not merely sending keys and note about termination
future advances mortgage v other jr mortgages
generally, if future advances OBLIGATORY, first-in-time rule applies
BUT if future advances are OPTIONAL, subsequent mortgages have priority IF original lender has notice of them
What may a remainderman sue the life tenant for?
WASTE ONLY
life tenant not required to pay mortgage principal, just interest
If a buyer relies on a forget instrument, does his reliance protect his interests?
NO, a forged instrument has no legal effect and cannot be relied on
If there is easement by necessity, but another property owner offers the same easement, is first easement extinguished
NO, easement by necessity still exists
Are life tenants/remainder tenants required to pay mortgage?
No, not PERSONALLY LIABLE, but may lose property interest if they do not pay
Assume mortgage v. subject to mortgage: who is liable?
Assumed mortgage: New Buyer PRIMARILY liable, original debtor SECONDARILY liable
Subject to mortgage: New buyer NOT personally liable, original debtor LIABLE FOR ALL
