Property for BAR Flashcards
Fee Simple Absolute:
“To A and his heirs.”
“To A.”
Duration: Absoluate ownership of potentially infinite duration.
Transferability:
Devisable
Descendible
Alienable
NO FUTURE INTEREST
Fee Tail
“To A and the heirs of his body.”
duration: Lasts only as long as there are lineal blood descendants of grantee.
Transferability: Passes automatically to grantee’s lineal descendants.
Future Interest:
Reversion (if held by grantor)
Remainder (if held by 3P)
Defeasible Fee (3 types)
1) Fee Simple Determinable
‘To A so long as…”
‘To A until…’
“To A while…”
(language providing that upon happening of a state event, the land is to refer to the grantor)
If stated condition violated forfeiture is automatic.
*You may convey less than what you started with, but you can’t convey more (can’t always get what you want, Mick Jagger).
Duration: potentially infinite, so long as event does not occur.
Transferability: Devisable Descendible Alienable Subject to Condition.
Future Interest: Possibility of Reverter (held by grantor)
FSDPOR
Fee Simple Determinable Possibility of Reverter
Frank Sinatra Didin’t Prefer Orville Redenbacher
Defeasible Fee Type 2
Fee Simple Subject to Condition Subsequent
‘To A, but if X event happens, grantor reserves right to reenter and retake.”
Grantor must carve out right of reentry.
Grantor’s perogative to choose to terminate or to look the other way. Estate NOT automatically ended, but can be cut short at grantor’s option if stated condition occurs.
Duration: potentially infinite, so long as condition is not breached and thereafter, until the holder of the right of entry timely exercises the power of termination.
Transferability: Devisable Descendible Alienable Subject to Condition.
Future Interest: Right of Entry/Power of Termination (held by grantor)
Defeasible Fee Type 3
Fee Simple Subject to an Executor limitation
‘To A, but if X event occurs, then to B.”
Just like fee simple determinable except if condition broken, estate automatically forfeighted to someone other than Grantor.
Potentially infinite, so long as stated contingency does not occur.
Transferability: Devisable Descendible Alienable Subject to Condition.
Future Interest: Executory interest, held by 3P
Life Estate
‘to a for life.’ (A is known as life tenant).
‘To A for the life of B.”
*NEVER in terms of years.
Life tenant entitled to all ordinary uses and profits from the land, but life tenant MUST NOT commit waste (must not harm future interest holders).
Duration: measured by life of transferee or by some other life (put autre vie)
Transferability:
Alienable
Devisable,
Descendible….if pur autre vie and mesaring life is still alive .
Future Interest: Reversion (if held by grantor). Remainder (if held by 3P).
Words of mere desire, hope, or intention are insufficient to create a defeasible fee.
Instead, A gets fee simple absolute (when grantor intended defeasible fee but used ‘purpose’ ‘hope’ ‘expectation’ language.
Absoluate restraints on alienation are void.
absolute ban on sell or transfer that is not linked to a reasonable time limited purpose not allowed.
‘to a so long as she never attempts to sell’ = void. A gets fee simple absolute, O gets nothing.
Voluntary or Affirmative Waste is
Overt conduct that causes a drop in value
*Beiber trashes yard doing donuts, breaks out windows of house.
Life Tenant must not consume or exploit natural resources (timber, oil, minerals) unless one of four exceptions apply…
PURGE Exceptions…
PURGE:
PU: Prior Use (prior to grant, land was use for exploitation)
R: Repairs (consume resoruces for repairs and maint.)
G: Grant (tenant may exploit minerals if granted right)
E: Exploitation (land is suitable only to exploit, quarry)
Open Mines Doctrine…
if mining done on land before life estate began, life tenant may continue to mine, but is limited to mines already open. can’t open new mines.
PERMISSIVE waste or neglect occurs when land falls into disrepair due to pattern of neglect.
Life tenant must Maintain the premises in reasonably good repair.
obligated to pay all ordinary taxes.
Ameliorative Waste
Must not engage in acts that will enhance the property’s value unless all future interest holders are known and consent.
3 Future interests (6 totalFuture interests) capable of creation in the grantor:
1) Possibility of Reverter (Fee Simple Determinable)
2) Right of Entry/Power of Termination (Fee Simple Subj. to Condition Subsequent)
3) Reversion (back-up, default) when grantor transfers an estate of lesser duration/quantum than start with, other than the 2 mentioned herein.
If future interest held by someone other than grantor, must be 1 of 3 future interests….
1) Vester Remainder (indefeasbily vested remainder; vested remainder subj to complete defeasence; vested remainder subj to open).
2) Contingent Remainder
3) Executory Interest (i - shifting or springing)
Remainder…
future interest in grantee
capable of becoming posessory upon expiration of a prior posessory estate
created in the same conveyance in which the remainder is created
Remainderman is sociable, polite.
Waits for present estate to naturally end (life estate or term of years).
Always accompanies preceding estate of FIXED DURATION.
Preceding estate usually a LIFE ESTATE OR TERM OF YEARS.
REMAINDERMAN NEVER FOLLOWS A DEFEASIBLE FEE.
Remainder vested if
BOTH Created in an ascertained person and is NOT subject to any condition precedent.
Remainder is Contigent if
created in an unascertained person OR subject tot a condition precedent, or both.
Rule of Destructability of Contigent Remainders
Common Law: continent remainder destroyed if still contingent, at time the preceding estate ended. (O gets fee simple absolute)
Today: Destructability rule abolished.
To A for life, and if B has reached 21, to B. (A dies and B is only 19). Common law, O gets fee simple. Today: O holds the estate subject to B’s springing execturoy int.
The Rule in shelley’s case
Applies in one setting: O to A for life then on A’s death, to A’s heirs. A is alive.
Common law: present and future int merge to give A fee simple absolute. Applies even in face of contrary grantor intent.
TODAY: rule of shellye’s case abolished.
O to A for life then on A’s death, to A’s heirs. A is alive.
A has life estate. A’s unknown heirs have a contigent remainder. O has a reversion.
Doctrine of Worthier Title - viable in most states today.
When O is alive, tries to crate a future int in his heirs (to A for life then to O’s heirs)
Grantor’s intent controls and will be honored.
If Doctrine of Worthier title did not apply, A has life estate and Os heirs have contigent remainder.
Due to Doc of Worthier title, Contigent remainder in Os heirs void. A has life estate and O has reversion.
Promotes free land transfer.
Indefeasibly vested remainder (1 of 3 vested remainders)
Holder of remaidne is certain to acquire setae in future with no strings attached.
vested remainder subject to complete defeasence (Forfeiture) (1 of 3 vested remainders)
Also called vested remainder subject to total divestment.
right of remainder man possession could be cut short b/c of condition subsequent.
Comma Rule - when conditional language in transfer follows language that, taken alone and set of by commas, would create a vested remainder, condition is a cond. subsequent = vested remainder subj to complete defeasence.
Note: condition precedent results in contingent remainder.
Vested remainder subject to open (1 of 3 vested remainders)
Remainder is vested in group of takers, at least one of whom is qualified to take, but each class emmber’s share is subj. to a particle diminution b/c additional members can still join.
Rule of Convenience: Class closes whenever any member can demand possession.
Executory Interest….
Future interest created in 3P, which is not a remainder and which takes effect by either CUTTING SHORT some interest in another person (SHIFTING) or in the grantor or his heirs (SPRINGING).
SHIFTING exec interest
always follows a defeasible fee and cuts short someone other than the Grantor.
Holder of Exec. Interest is the interrupter.
SPRINGING exec interest
Cuts short O, the Grantor.
A is the interptor.
Rule Against Perpetuities (RAP)
Future interest void if any possibility that interest may vest more than 21 years after death of measuring life.
RAP potentially applies only to…
Contingent Remainders
Executory Interests
Certain Vested Remainders Subject to OPEN
RAP DOES NOT Apply to..
Any of the 3 future interest in O, the Grantor
indefeasibly vested remainders
vested remainders subjct to complete defeasence.
Once you know RAP Applies..
Step 2: ID the Conditions Precedent to the Vesting of the suspect future interest.
Step 3: find a measuring life (look for person alive at date of conveyance). Persons life or death is relevant to condition’s occurrence. (Grant to A specifically = A measuring life)
STEP 4: will we know for certain that within 21 years of death of the measuring life that future interest holders can or cannot take?
Fertile Octogenearion Rule
A could have another child, no matter how old she is.
Bright Line RAP RULE:
A gift to an open class that is conditioned on the members surviving to an age beyond 21 violates RAP.
Bad as to one, bad as to all - entire class gift void if disposition might vest too remotely for just one class member.
Bright LINE RAP RULE 2:
Many shifting executory interests violate the RAP. An executory interest with no limit on the time within which it must vest violates the RAP
- Shifting Exec. Interest that violates RAP will result in Fee Simple Determinable in A (‘ so long as’) and Possibility of Reverter in O.
- Shifting Exec Int that violates RAP where conveyance uses “But if” will result in Fee Simple absolute in A and nothing in O. (b/c conveyance must remain grammatically sound.)
Charity to Charity Exception of RAP
!
Reform of RAP:
The wait and see or second look doctrine
Validity of any suspect future int determined on bases of facts as they know exist, at the end of the measuring life. Then see if it passes scrutiny.
Reform of RAP
Uniform Statutory Rule Against Perpetuities (USRAP)
Codifies common law rap and provides for an alternative 90 year vesting period.
Cy Pres Doctrine = “As Near As Possible”
If disposition violates RAP, court may reform in way that most closely matches Grantor’s intent while complying with RAP.
Both wait and see and USRAP reform embraces Cy Pres Doctrine.
Both reform efforts take the reduction of any offensive age contingency to 21 years.
Three forms of Concurrent Ownership…
Joint Tenancy (2 or more own with right of survivorship)
Tenancy by the Entirety (Betweeen married partners with the right of survivorship)
Tenancy in Common (2 or more own with no right of survivorship)
Joint Tenancy is distinct due to role of survivorship (1 joint tenant dies, his share goes automatically to the surviving joint tenant).
Joint Tenancy is distinct b/c joint tenants interest is alienable. Not devisable or descendable b/c of automatic right of survivioshrip.
Last survivor in joint tenancy takes everything.
Creation of Joint Tenanncy requires T-TIP
T-TIP
Joint tenants must take interest at same: TIME TITLE (by same title) IDENTICAL (identical interest) and POSESS (rights to possess the whole)
GRANTOR MUST CLEARLY EXPRESS RIGHT OF SURVIVORSHIP
Joint tenancies are disfavored.
Use of a straw man. To satisfy four unities, must use a straw man (middleman).
Severance of Joint Tennancy: SPAM
Sale, Partition, and Mortgage
SPAM:
(S)
Severance and Sale
- (joint tenant can sell or transfer her interest during lifetime. Can do so secretly. Buyer becomes tenant in common. if 2 joint tenants remain, there joint tenancy remains in tact)
- In equity, joint tenant’s mere act of entering into K to sale her share will sever joint tenancy. B/c Doc of Equitable Conversion
Severance of Joint Tennancy: SPAM
Sale, Partition, and Mortgage
SPAM - (P)
Severance and Partition (3 variations)
1) By voluntary agreement - peaceful way to end relationship
2) Partition in kind: Court action for physical division of land if in best interest in all.
3) Forced Sale: - Court Action if in best interest of all, Land sold and proceeds divided proportionally.
Severance of Joint Tennancy: SPAM
Sale, Partition, and Mortgage
SPAM - M (Severance and Mortgage)
One joint tenants execution of mortgage or lien on his share will sever joint tenancy as to that share in MINORITY of states following TITLE THEORY>
Mortgage in LIEN Theory states (MAJORITY) will not sever joint tenancy.
TENNANCY BY THE ENTIRITY (21 STATS)
Between married partners with right of survivorship (can’t be engaged, married only).
very protected form of co-ownership
cCANT TOUCH THIS. Creditors of only one spouse can’t touch this tenancy. Immune from attack.
Neither tenant acting alone can defeat right of survivorship by unilateral transfer to 3rd party.
TENNANCY IN COMMON
Each co-tennant owns an individual part and each has a right to possess the whole.
Each interest divisble, descendable, and alieanble.
NO SURVIVORSHIP RIGHTS.
Presumption favors tenancy in common.
Each co-tennant is entitled to possess the whole.
if one co-tenant wrongfully excludes another co-tenant from possession of the whole or part, he has committed a WRONGFUL OUSTER.
absent ouster, a co-tenant in exclusive possession, is not liable to the others for rent (as long as others left voluntary)
A co-tenant who leases all or part of the premises to a 3P MUST ACCOUNT to his co-tennants FOR RENT from 3P tenant, giving them their fair share of the rent in the account. (fair share equal to undivided interest in the whole).
Adverse Possession - Unless he has ousted the other co-tenants, one co-tenant in exclusive possession for the statutory adverse possession period CANNOT acquire title to the exclusion of the others.
Hostility element of adverse possession is absent. No hostility b/c there was never an ouster.
Each co-tenant is responsible for his or her share of CARRYING COSTS (taxes, mortgage interest payments), based upon his undivided share.
REPAIRS: The repairing co-tenant enjoys a right of contribution for reasonable and necessary repairs, provided that the co-tennant has told the other of the need for the repair.
During life of co-tenancy, there is NO RIGHT to contribution for IMPROVEMENTS
At partition, improveing co-tenant is entitled to CREDIT, equal to any increase in value she caused for improvement.
IMPROVER also bears full liability for any drop in value that the unilateral improvement caused.
WASTE - a co-tenant must not commit waste (voluntary, permissive, ameliorative).
A covenant can bring a waste action during the life of the cotennancy
PARTITION - a joint tenant or tenant in common has a right to bring an action for partition.
Four Leasehold, Non-freehold Estates
1) Tenancy for Years (Estate of Years or Term of Years) - lease for a fixed period (termination date known from start).
* NO NOTICE NEEDED to TERMINATE. Term of years greater than one year must be in writing to be enforceable b/c of SoF.
2) Periodic Tenancy - Lease which continues for SUCCESIVE intervals until L or T give proper notice of termination. Can be created expressly (yr to yr; mo to mo; wk to wk)
3) Tenancy at Will - no fixed duration. To T for as long as T desires.
4) Tenancy at Sufferance - crated when T has wrongfully held over past expiration of lease. Lasts only until L either evicts T or elects to hold T to a new tenancy.
Periodic Tenancy can be by implication
(3 ways)….
1) Land is leased w/ no mention of duration, but provision is made for payment of rent at set intervals.
2) An oral term of years in violation of the SoF creates an implied periodic tenancy, measured by the way rent is tendered.
3) The Holdover - in a RESIDENTIAL lease, if L holds over a T who has wrongfully stayed past the conclusion of the original lease… an implied periodic tenancy arises measured by the way rent is now tendered.
To terminate a periodic tenancy….
notice, usually written, must be given.
Notice at least equal to the period itself must be given, unless otherwise agreed.
Month to month tenancy = 1 month notice
Week to Week tenancy = one week notice
Year to Year tenancy = 6 months notice.
Parties may lengthen or shorten common law prescribed notice provisions by private agreement.
Periodic tenancy must end at the conclusion of a natural lease period
!
Tennancy at Will is for no fixed duration.
unless parties expressly agree to a tenancy at will, payment of regular rent will cause a court to treat this as an implied periodic tenancy.
Tennancy at will may be terminated by either party at any time. Resonable demand to vacate usually needed.
Tenants duties….
T is responsible for keeping the premises in good repair.
T is liable for injuries sustained by 3rd parties INVITED, even where L promise to make repairs.
When LEASE SILENT, T must maintain premises and make routine repairs (other than those due to ordinary wear and tear).
Law of FIXTURES
When a tenant removes a fixture she creates voluntary waste.
FIXTURE is a once movable chattel that by virtue of its annexation to realty, OBJECTIVELY shows the intent to permanently improve the realty.
T MUST NOT remove a fixture no matter that she installed it. Fixture passes with ownership of land and stays put.
If removal of chattel will cause substantial damage, then in objective judgment, T has shown the intent to install a fixture and it stays put.
T’s duty to repair when T has expressly promised in the lease to maintain the property in good condition for duration of the lease
Common law: T liable for ANY loss, including loss due to force of nature.
Today: T is off the hook when premises destroyed without T’s fault.
T’s Duty to Pay Rent: T breaches this duty and is in possession of the premises then L’s only options are to evict through the Courts or continue relationship and sue for rent due.
= Tennant at sufferance.
L MUST NOT engage in self help, such as changing the locks, forcibly removing the T, removing T’s possessions.
Self help is flatly outlawed and punishable civilly and criminally.
If T Breaches duty to pay rent and is out of possession (T leaves premises with time left)
Remember SIR
SIR:
SURRENDER (L can treat T’s abandonment as implicit offer of surrender, which L accepts. If unexpired term greater than 1 year surrender must be in writing to satisfy SOF)
IGNORE (the abandonment and hold T responsible for unpaid rent, just as if T still there. MINORITY states)
RE-LET the premises (on wrongdoer’s behalf and hold him or her liable for any deficiency.) L must at least try to re-let the premises; mitigation principle.
LANDLORD’s DUTIES
1) L put T in actual possession. (if prior holdover still in possession, then L has breached and new T gets damages).
2) Implied Covenant of Quiet Enjoyment (applies to residential and commercial leases;
3) Implied Warranty of Habitability
4) Retaliatory Eviction - if T lawfully reports L for housing code violations, L is barred from penalizing T (raising rent, ending lease, harassing T).
Implied Covenant of Quiet Enjoyment
L can (i) breach by actual wrongful eviction (L wrongfully evicts T or excludes T from premises) (ii) breach by constructive eviction
ELEMENTS FOR CONSTRUCTIVE EVICTION:
SING
Tennant must show:
Substantial Interference (due to L’s actions or failures)
Notice (T must notify L of problem and L fail to fix it)
Goodbye (Get out. T must vacate within reasonable time after L fails to fix)
*L is NOT liable for acts of other tenants. Two exceptions: 1) L must not permit a nuisance on site. 2) L must control common areas.
Implied Warranty of Habitability
Applies only to Residential Leases
*non-waivable.
Standard:
- premises must be fit for basic dwelling
- bare living requirements must be met
Appropriate standard may be supplied by housing code or case law.
Implied Warranty of Habitability
T’s entitlement when the implied warranty of habitability is breached….MR^3: Move, Repair, Reduce, Remain
MR^3
Move out and end the lease (but, T doesn’t have to)
Repair and Deduct (T repairs and deducts cost from future rent)
Reduce Rent (0r withhold all rent until court determines fair rental value; T must place withheld rent into escrow to show good faith).
Remain in possession, pay rent and affirmatively seek $ damages.
If lease silent, T may freely transfer interest in the WHoLE (accomplishing an assignment) or IN PART (accomplishing a sublease).
In the lease, L can prohibit T form assigning or subletting without L’s Prior Written Approval.
Once L consents to one transfer by T, L waives the right to object to future transfers by that T, unless L reserves the right.
EX: T1 has 10 months remaining on 2 year term of years. T1 transfers all 10 months to T2 = ASSIGNMENT.
L and T2 in privity of estate.
L and T2 liable to each other for all promises in the original lease that RUN WITH THE LAND. (ex: promise to pay rent, paint the premises, or to repair).
L and T2 are NOT in privity of contract, unless T2 assumed all promises in the original lease.
L and T1 no longer in privity of estate, but remain in privity of contract. Thus, L and T1 secondarily liable to each other.
Sublease…
L and sublease are neither in privity of estate nor privity of contract.
T2 is liable to T1 and vice versa.
Landlord Tort Liability
Common law of Caveat Lesee: Tenant Beware (In tort, L was under no duty to make premises safe). 5 important exceptions….CLAPS
CLAPS:
Common areas - Even in tort, L must maintain all common areas.
Latent defects rule - L must warn T of hidden defects that L knows about our should know about. Merely duty to warn, not to repair.
Assumption of Repairs - L who makes repairs negligently is liable.
Public Use Rule - L who leases public space (convention hall) and who should know, b/c of nature of the defect and length of lease, that T will not repair, is liable for defects on premises.
Short term lease of furnished dwelling. L is liable for any defect on site.
Affirmative Easements - Created by PING…
Easement is the GRANT of a nonposessory property interest that entitles its holder to some form of use or enjoyment of another’s land, called the SERVIENT TENEMENT.
EX: laying utility lines on another’s land, right to access across tract of land.
SCOPE of easement determined by the terms that created it.
PRESCRIPTION - use that is continuous, open and notorious, actual under a claim of right that is hostile for requested stuatory period = satisfy elements of Adverse Possession (COAH)
IMPLICATION - implied from prior existing use, at time land is severed, a use of one part existed from which it can be inferred that an easement permitting its continuation was intended. No writing needed. previous use apparent, parties expected it would continue b/c it is reasonably necessary to the dominant lands use and enjoyment.
NECESSITY - division of tract deprives one lot of means of access out). Landlocked setting.
GRANT - writing signed by grantor (more than 1 yr must be in writing for SoF; writing is called ‘Deed of Easement’)
Remedy = Injunction or Damages
Affirmative Easement - parties bound…
Easement Appurtenant – is transferred automatically with dominant tenement (even if not mentioned in conveyance). Burden also passes automatically with servant estate, unless new owner is BFP without notice. It takes 2 parcels! Dominant tenement = benefit. Servient tenement = burden.
Easement in Gross for commercial purposes is assignable. Only 1 piece of land that is burdened, no dominant tenement. Ex: right to place a billboard, righ tot swim in another’s pond, right to lay power lines.
*Easement is NOT transferable unless its for commercial purposes.
Negative Easements - LASS
Light Air Support and Streamwater from artificial flow.
Minority of states include scenic view.
Can only be created EXPRESSLY - only by writing signed by grantor.
Remedy = Injunction or Damages
Real Covenants
Created by: Writing Signed by Grantor
*A promise to do or not do something related to the land. UNLIKE the easement b/c it is not the grant of property interest, but a CONTRACT regarding the land.
Covenants can be negative = RESTRICTIVE COVENANT (promise not to do something).
BURDEN of promise will run to successors of burdened lot if WITHIN requirements are satisfied
Writing (promise in writing) Intent Touch and Concern (effects parties as landowners) *Horizontal Privity AND Vertical Privity AND Notice (of the promise when she took)
BENEFIT of promise will run to successor of benefited lot is WITV:
Writing
Intent
Touch and concern and
Vertical Privity.
Remedy = damages
If remedy P seeks is $ damages = Covenant.
If remedy P seeks injunction = Equitable Servitude
Equitable Servitude
*A promise that equity will enforce against successors, accompanied by injunctive relief.
Created by Writing signed Grantor
Successors bound if WITNes:
Writing (original promise in writing)
Intent (parties intended written promise would bind successors)
Touch and concern
Notice (successors of burdened land had notice of promise)
(privity not required)
Remedy = injunction
If remedy P seeks is $ damages = Covenant.
If remedy P seeks injunction = Equitable Servitude
Reciprocal Negative Servitude (IMPLIED) (General Scheme Doctrine)
Created by: in a subdivision, residential restriction contained in prior deeds conveyed by common grantor will bind subsequent grantees whose deeds contain no such restriction if: At start of subdividing, grantor had (i) common general scheme and (ii) unrestricted lot holders had notice.
Where common scheme exists, subsequent purchasers with notice are bound.
Remember AIR (3 forms of notice to impute D) A - Actual notice - D knew of common restriction before he took I - Inquiry Notice - neighborhood conforms to common restriction (lay of the land) R - Record notice - form of notice sometimes imputed to buyers on basis of publicly recorded documents.
Remedy: Injunction
DEFENSES: CHANGED CONDITIONS= changes so pervasive that the entire area has changed. party seeks release from terms of equitable servitude.
Elements of Adverse Possesion….COAH
- posession for a statutorily prescribed period of time can ripen into title if certain elements met.
COAH:
Continuous use for the statutory period. Uninterupted.
Open and Notorious Use
Actual Use that need not be exclusive
Hostile Use (w/o the servant owner’s consent if easement)
(TACKING = 1 AP may tack on to his time the predeccesor’s time as long as there is PRIVITY (blood, contract, deed, will); TACKING not allowed when there has ben an OUSTER).
AP SoL will not run against true owner who is afflicted by Disability at START of AP.
To Terminate an EASEMENT… Remember END CRAMP
END CRAMP (ways to end an easement)
Estoppel - servant owner materially changes her position in reasonable reliance on the easement holder’s assurances that the easement will not be enforced.
Necessity - easements created by necessity expire as soon as need end. However, if created by express grant then it persists even when the need ends.
Destruction - of servant land, other than through willful conduct of servant owner
Condemnation of servant estate (by eminent domain)
Release - written release given by easement holder to the servant owner
Abandonment - easement holder must demonstrate by PHYSICAL ACTION the intent to never use the easement again.
Merger doctrine - unity of ownership. easement extinguished when title to the easement and title to the servant land become vested in the same person. Even if title later separated, easement is not revived.
Prescription - servant owner may extinguish easement by interfering with it in accordance with elements of adverse possession (COAH).
The License
is a mere privilege to enter anthers land for delineated purpose.
Licenses are not subject to SoF. Do not need a writing.
Licenses are freely revocable at will of licensor, unless estoppel applies to bar revocation.
Examples: Ticket to show. Neighbors talking by the fence.
*Estoppel will bar revocation only when licensee has invested substantial $ or labor or both in reasonable reliance on the licenses’s continuation.
The PROFIT….
entitles holder to enter servant land and take from it, soil or some substance of soil such as minerals, timber, oil.
Profit shares all the easement rules.
Horizontal Privity….
Requires A and B are in succession of Estate:
Grantor/Grantee
Landlord/Tennant
Mortgagor/Mortgagee
A likely sticking point when burdens won’t run
Vertical Privity….
Nexus between A and A1
Blood, contract, devise (will), descent (intestacy).
Vertical privity only absent if A1 acquired interest through Adverse Possession.
Every Conveyance of Real Estate is a 2 step process….
1) Land K (short life, endures until closing)
2) The Closing, where deed becomes operative document
Land K must be in writing, signed by the party to be bound (your D), must describe the land AND state some consideration.
EXCEPTION to SOF: DOCTRINE OF PART PERFORMANCE
Need 2 of 3 to satisfy and get specific performance of oral K for sale of land:
1) B takes possession
2) B pays all or part o fate price
3) B makes substantial improvements
RISK OF LOSS:
Doc of Equitable Conversion: Once K signed, B owns the land, even if closing hasn’t occurred.
If Land Destroyed/Destruction between Land K and closing, B bears the risk of loss unless the K says otherwise.
2 implied promises in every land K…
1) S promises to provide MARKETABLE TITLE at CLOSING. Title free from reasonable doubt, free from lawsuits and threat of litigation.
Title unmarketable if 1) Adverse Possession; 2) Encumbrances (servitudes, mortgages); 3) Zoning violations (not mere restrictions)
2) S promises not to make any false satement of material fact. S liable for failure to disclose blatant material defects; S liable for material lies and omissions. General Disclaimer of liability ‘as is’ won’t excuse S from liability for fraud.
Caveat Imptor - B beware.
Land K contains no implied warranties of fitness or habilitity.
One exception - implied warranty of fitness and workmanlike construction applies to sale of new home by builder
***S has right to satisfy outstanding mortgage or lien at closing with proceeds at sale.
Thus, B can’t claim title unmarketable b/c it is subject to mortgage prior to closing, so long as parties realize the closing will result in mortgage being satisfied.
The Closing = controlling doc becomes the deed. Land K dies.
Deed passes by LEAD…
LEAD: Lawfully Executed and Delivered
1 - deed must be in writing, signed by Grantor. NO need for consideration.
2 - must be description of land, but does’ thane to be perfect.
3 - DELIVERY = satisfied when grantor physically transfers deed to grantee. Mail, Agent, Messenger permitted.
Delivery of Deed does not necessarily require physical transfer of deed itself
Legal Standard: test of present intent:
Did grantor have present intent to be bound irrespective of whether or not deed was handed over.
REcipient’s express rejection of the deed Defeat’s delivery.
Delivery by ESCrow is okay. Use escrow agent with ins ructions that deed be delivered once certain conditions are met. Once conditions met, title passes to grantee.
If deed is transferred with an oral condition, oral condition drops out, it is not provable, and delivery is done.
QUITCLAIM DEED
Contains no covenants. Grantor isn’t even promising that he has title to convey. Worst Deed B could hope for.
General Warranty Deed (Best Deed B could hope for)..
Contains 6 covenants
Three present covenants:
Present covenant breach at moment of deed delivery. SOL begins to run from moment of instant delivery
1) covenant of Seisin: Grantor owns the estate
2) covenant of right to convey: Grantor has poet to transfer. G has no disability, no restraints on alienation. G is over 18.
3) Covenant Against Encumbrances - No servitudes or Mortgages on Land.
Three Future Covenants
Not breached, if ever, until Grantee is disturbed in possession. SOL for breach of future covenants doesn’t begin to run until that future date.
4) Covenant for Quiet Enjoyment (Grantee won’t be disturbed in possession by 3Ps lawful claim of title)
5) Covenant of Warranty (Grantor will defend Grantee against lawful title claims by others)
6) Covenant for Further Assurances - Grantor will do what’s needed in the future to perfect the title.
Statutory Special Warranty Deed
provided by statute. Contains 2 promises that grantor makes only on behalf of himself
1) Grantor promises he hasn’t conveyed land to anyone other than Grnatee
2) Land is free from encumbrances made by Grantor.
Recording System: if B is BONA FIDE PURCHASER and we are in NOTICE juries, B WINS regardless of whether or not she records before A does.
Recording System: if B is BONA FIDE PURCHASER and we are in RACE-NOTICE juries, B WINS if she records properly before A does.
BFP is purchaser who…
1) purchases Blackacre for value
2) without notice that someone else got their first.
Recording statutes do NOT protect donees, devisee’s, or heirs unless the SHELTER Rule applies.
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Three forms of notice that B may be charged with include AIR:
Actual, Inquiry, Record notice.
Actual Notice - prior to B’s closing B learns of A.
Inquiry Notice - B on notice whether he looks or not. B has duty to inspect. IF recorded instrument makes reference to unrecorded transaction, grantee is on inquiry notice of whatever a reasonable follow up would show.
Record notice - B is on record notice of A’s deed if at the time B takes, A’s deed was recorded properly
Notice Statute:
“A conveyance of an interest in land shall not be valid against any subsequent purchaser for value, w/o notice thereof, unless conveyance is recorded.”
If at time B takes and he is BFP, he wins.
Wont matter that A ultimately may record first before B does.
Race Notice Statute:
“A conveyance of an interest in land shall not be valid against any subsequent purchaser for value, w/o notice thereof, unless conveyance is FIRST recorded.”
To prevail, B must be a BFP and B must win the race to record.
The Shelter Rule - one who takes from a BFP will prevail against any entity that the transferor BFP would have prevailed against.
Transferree takes shelter in the status of the transferor and steps into the shoes of the BFP even though she otherwise fails to meet the requirements of the BFP status.
Rule of the wild deed (link missing from the records)
if deed, entered into records, has a grantor unconnected to the chain of title, the deed is a wild deed.
IT IS INCAPABLE OF GIVING RECORD NOTICE OF ITS EXISTENCE
Estoppel by Deed..
one who conveys realty in which he has no interest, is estopped from denying the validity of that conveyance if he later acquires that previously transferred interest.
A Mortgage….
the conveyance of a security interest in land, intended by the parties to be collateral for the repayment of a debt.
A mortgage is the union of 2 elements:
1) a Debt
2) a voluntarily lien in debtor’s land to secure the debt.
Debtor = Mortgagor.
Creditor = Mortgagee
Mortgage typically must be in writing to satisfy SoF
this is the legal mortgage.
Can be called the note, a security interest in land,, a deed of trust, the mortgage deed, or a sale leaseback.
Equitable Mortgage created when O hands Creditor a deed to land that is absolute on its face in return for Creditor lending O a sum o f$.
Parol evidence is allowed to show intent.
If creditor sells land to BFP, then BFP owns land and O’s only recourse is to sue creditor for fraud and the sale proceeds.
Once Mortgage created, Debtor/Mortagor has title and the right to possess (until foreclosure)
Creditor mortgagee has a lien
All parties to mortgage can transfer their interest.
Mortgage automatically follow a properly transferred note.
Creditor Motrgagee can transfer his interest by…
1) endorsing the note and delivering it to the transferee
OR
2) by executing a separate document of assignment
If note is endorsed and delivered, transferee is eligible to become a HOLDER IN DUE COURSE.
HOLDER IN DUE COURSE takes note free of any personal defenses that could shave been raised agains that original mortgagee.
Personal defenses include lack of consideration, fraud in the inducement, uncionsability, waiver, estoppel.
Thus, holder in due course may foreclose mortgage despite any such personal defense.
holder in due course still subject to REAL defenses that the maker/debtor might raise:
MAD FIFI^4 = REAL DEFENSES
MAD FIFI^4 Real Defenses:
Material Alteration Duress Fraud in the Factum (lie about the instrument being signed) Incapacity Illegality Infancy Insolvency
To be a holder in DUE COURSE of the note, must meet following criteria….
Note must be negotiable, meaning made payable to named mortgagee.
Original note must be endorsed, signed by named mortgagee
Original note must be delivered to transferee. no photocopy.
Transferee must take note in good faith without notice of any illegality.
Transferee must pay VALUE for note, more than nominal.
If B ASSUMES the Mortgage….
Both O and B are personally liable.
B is primarily liable.
O remains secondarily liable.
if B TAKES SUBJECT TO THE MORTGAGE..
B assumes no personal liability.
Only O is personally liable.
But, if recorded, the mortgage sticks with the land, thus if O does not pay, the mortgage may be foreclosed.
Foreclosure - mortgagee may foreclose by proper judicial action.
If proceeds of foreclosure less than amount owed…
Mortgagee brings a defieicny action against debtor.
Shortfall = Defiency Actoin.
If surplus, Jr liens paid in order of priority.
Recording statutes apply to mortgages as well as deed
Thus, as long as creditor promptly records its mortgage interest, a later buyer takes subject to the properly recorded lien in both Notice and Race-Notice.
Foreclosure payout order…
1) attorney’s fees, foreclosure expenses, and any accrued interest on first bank’s lien.
Then, each claimant is paid IN FULL in order of their priority.
Foreclosure terminates interests JR to mortgage being foreclosed but will not affect SR interests.
Those with interests subordinate to those of the foreclosing party are NECESSARY parties to the foreclosure action.
Includes Debtor.
If necessary path not joined, his mortgage remains on the land.
Foreclosure DOE NOT affect any interest SR to the mortgage being foreclosed.
B is NOT personally liable to the SR debt, but if SR debt not paid then SR creditor will foreclose on the land so B needs to pay it off.
CREDITOR priority:
First in time, first in right (first to record)
The Purchase Money Mortgage (given to secure a loan that enables the debtor to acquire the encumbered land) has SUPERIORITY.
After Acquired Collateral Clause
AKA the Floating Lien
security interest in all of O’s real setae holdings, whether now owned or hereafter acquired.” Permisible.
Subordination agreements….allowed…
a SR creditor may agree to subordinate its priority to a JR creditor (freedom of K)
REDEMPTION - in equity…
Equitable Redemption
at any time prior to foreclosure sale, debtor can try to redeem the land.
Once forcslore takes place, right to equitable redemption is gone.
Exercised by paying off the missed payment or payments plus interest and costs.
Clogging = debtor waiving the right to redeem the mortgage. = PROHIBITED>
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Statutory Redemption (1/2 states)
Debtor has stat. right to redeem for fixed period AFTER foreclose sale has occurred (6 mo to 1 yr)
Applies AFTER foreclosure.
Amount paid is foreclosure sale price, rather than amount of original debt.
When mortgagor redeems effect is to nullify the foreclosure sale.
Lateral support - if land improved by buildings and adjacent landowner’s excavation cause improved land to cave in, excavator liable only if negligent.
STRICT LIABILITY if P cn show that P’s improved land would have collapsed even in its unadorned state (if P’s land was bare; weight of improvements did not contribute to collapse).
Riparian Doctrine: water belongs to those who own the land bordering the water course
known as Riparian owners, who share right of reasonable use of the water.
One riparian will be liable if his use unreasonably interferes with others use.
Prior Appropriation Doctrine
Water belongs initially to the state, right to divert and use it can be acquired by individual, regardless of whether or not he happens to be a riparian owner.
Rights determined by priority of beneficial use.
First in time first in right for allocation.
Groundwater (percolating water).
Surface owner entitled to make reasonable use of groundwater, use must not be wasteful
Surface water (rain, springs, melting snow not in natural course)
Menace to be irradiated.
landowner may change drainage or make any other change/improvement on his land to combat the flow of surface water. Many cts have modified the common enemy rule to prohibit unnecessary harm to other’s land.
Trespass…
invasion by physical object. To remove trespasser bring ejectment action.
Private nuisance = substantial unreasonable interference with another’s landuse
odors, noise
hypersenstiive P no good.
Eminent Domain - Gov 5th Amend power to take private property for public use in exchange for just compensation.
Explicit takings: act of gov condemnation. take land for public highway.
Implicit/REgulatory Taking = Gov reg that has effect of taking. Remedy = Compensate owner or terminate regulation and pay owner for damages occurred while regulation was in effect.
Zoning = gov may enact a statute to reasonably control land use.
Variance = flexibilty in zoning.
P must show undue hardship and to grant the variance won’t work harm to neighboring prop values.
Unconstitional exaction
amenities Gov seeks in exchange for granting permission to build.
To be fair, must be reasonably related in nature and scope to the impact at the proposed development.
