Property MC Flashcards
ALA Quizzes, Kaplan Quizzes, Kaplan Qbank, Kaplan BAR Prep, MOST LIKELY/MAYBE CLS Quizzes
A miller runs a mill that processes only hardwood. Over the years, pine has remained plentiful in the area, but hardwood has become more difficult to find. The miller is informed that a developer plans to build a condominium development in a stand of hardwoods near the miller’s mill. The miller speaks with the developer and learns that he would like to have most of the stand cleared out because it is located in the center of his construction area. During their conversation, the developer agrees that the miller can clear the entire 20-acre stand and remove the trees to his mill. The miller has an unreliable truck that he has used for years, but he buys a new one to haul the hardwood from the developer’s property.
After the developer obtains all necessary permits, but before he breaks ground on the condominium project, he sells the property to an investor, who knows of the agreement between the miller and the developer and who intends to build a commercial building on the site. When the miller arrives to begin harvesting the trees, the investor prohibits him from entering the land, telling him that she intends to sell the hardwood to a dealer.
If the miller files suit seeking an order compelling the investor to allow him to harvest the hardwood, what is the most likely outcome?
The investor will prevail, because the miller and the developer did not have a written agreement that the miller could enter the land.
The investor will prevail, because the license is freely revocable.
The miller will prevail, because the investor cannot prevent him from entering the land under an estoppel theory.
The miller will prevail, because the easement is enforceable against the investor.
The correct answer is: The miller will prevail, because the investor cannot prevent him from entering the land under an estoppel theory.
Discussion of correct answer: A license is a right to enter the land of another. A license coupled with an interest is the right to enter land on which personalty in which the licensee has an interest is located. Here, the miller holds a license coupled with an interest because the developer (the licensor) has granted the miller (the licensee) the right to enter his property to remove personalty (the hardwood). A license is generally revocable at the will of the licensor. However, a license may become irrevocable in two situations: (1) a license coupled with an interest, which exists when one person owns personal property on the land of another and has a privilege incidental to such personal property to come on the land to use or recover the personalty; and (2) an executed license, which is based on estoppel and often involves substantial expenditure of funds in reliance on the promisor’s promise to allow the promisee to use the land. An executed license is sometimes deemed to be the equivalent of an easement. Because the miller expended substantial funds on a new truck to haul the wood from the investor’s property, the investor is estopped from revoking the miller’s license to enter the land.
A businessman divided his time between his three estates. On Tuesday, the businessman signed a valid purchase-and-sale agreement selling one of his estates to his partner. The deal was to close the following Monday. On Thursday, the businessman died while enjoying his mistress’s company at one of the estates not for sale. His will left his real property to his mistress for life, and the remainder of his estate was left to his wife. Wishing only to show his respect for the dead, the partner notified the businessman’s executor that he was willing to postpone the closing for several weeks, as long as he could move in immediately. The executor replied that the partner would now have to renegotiate the sale of the property with the mistress and with the remaindermen. The partner became livid at this information and filed suit against the businessman’s estate for specific performance.
Will the partner prevail, and why or why not?
Yes, because equitable title passed to the partner upon the execution of the purchase-and-sale agreement.
Yes, because the contract did not terminate with the businessman’s death.
No, because the property was now part of the mistress’ life estate.
No, because, as the businessman can no longer sign the deed, the contract has become impossible to perform.
The correct answer is: Yes, because equitable title passed to the partner upon the execution of the purchase-and-sale agreement.
Discussion of correct answer: Under the doctrine of equitable conversion, for the period of time between the signing of a valid purchase-and-sale agreement and the closing on the property, the seller retains legal title to the subject property, and the buyer acquires equitable title to the subject property. Therefore, when the purchase-and-sale agreement was executed, the partner acquired an equitable and enforceable interest in the estate.
A literary agent and a talk show host entered into a month-to-month lease agreement regarding a house owned by the agent. The bathrooms had not been renovated in 15 years, and the sinks, toilets and showers were rust stained and moldy. Without the agent’s permission, the talk show host undertook a renovation of the master bathroom. He installed new sinks, shower stalls and hi-tech self cleaning toilets with seat warmers. The lease agreement contained no provision regarding repairs and renovations. The jurisdiction follows the common law rule.
If the literary agent sues the talk show host, who will prevail?
A The agent, because the talk show host is not a life tenant.
B The agent, because the renovations constitute permissive waste.
C The talk show host, because the renovations increase the market value of the property.
D The talk show host, because the renovations constitute ameliorative waste.
A The agent, because the talk show host is not a life tenant.
Discussion of correct answer: Ameliorative waste is an act that increases the market value of the premises by permanently altering them. The renovations in this example constitute ameliorative waste. While a life tenant may commit ameliorative waste, tenants under regular lease agreements, such as the month-to-month lease in this example, may not commit ameliorative waste. Therefore, under the facts presented, the talk show host violated his duties by renovating the apartment and the agent will prevail.
A teacher moved to another state for a job and bought a house by taking out a mortgage with a bank. Among the various provisions in the mortgage note were: the loan amount, and the interest rate, and an acceleration clause providing that, in the event of default, the mortgagee could declare the entire balance due and that the mortgagor would forfeit his right of redemption in the event that a foreclosure sale was consummated.
Two years later, the teacher stopped making his payments. He defaulted on the loan and the mortgagee began proceedings for a judicial foreclosure. During this period, the teacher rented the house to a businessman but did not use any of the rent to pay the mortgage. The mortgage company held a foreclosure sale. Two months after the foreclosure sale, the teacher won a large amount of money from a scratch off lottery ticket and went to redeem his home but was prevented by the terms of his contract from redeeming the home after the foreclosure sale. This jurisdiction recognizes both equitable and statutory rights of redemption.
If the teacher brings an action to recover his home, what is the likely outcome?
A The teacher will not prevail, because he failed to redeem the home with the rent he received from the businessman.
B The teacher will not prevail, because a foreclosure sale terminates the mortgagor’s interest in the mortgaged real estate.
C The teacher will prevail, because the right of redemption may not be waived in the original purchase document.
D The teacher will prevail, because acceleration clauses are generally considered unconscionable.
C The teacher will prevail, because the right of redemption may not be waived in the original purchase document.
A man inherited a large estate with a log cabin that had been constructed many generations ago using wood from the surrounding old-growth forest. For over a century, the family had been exploiting the timber on the property by permitting companies to enter and remove trees at a sustainable rate, although never from a five-acre area around the log cabin. Not wanting to give up his life in the city, the man leased the log cabin and the five acres around it to a tenant. In the third year of the lease, a serious rainstorm caused part of the roof and walls of the cabin to collapse. The tenant, wanting to retain the locally sourced nature of the cabin, cut down several trees nearby to use in making repairs. While the repairs kept the log cabin from becoming unusable, the fact that old-growth trees were used for the repairs caused a net loss in the value of the property due to how long it would take for them to be replaced. When the man learned of this, he sued the tenant for the loss in value to the property and the value of the trees that had been cut down.
Will the tenant be required to reimburse the man?
A No, because the tenant used the trees to repair the property.
B No, because of the open mines doctrine.
C Yes, because the tenant committed voluntary waste.
D Yes, because the tenant committed ameliorative waste.
The correct answer is:No, because the tenant used the trees to repair the property.
Discussion of correct answer:A tenant is not allowed to do anything that adversely affects the future interest that follows the present possession; doing so is called waste. In the case of a lease, this means that the tenant cannot adversely affect the landlord’s interest in the property. When a tenant voluntarily commits an act that has more than a trivial injurious effect on or change in the property, the tenant has committed voluntary waste. However, despite the prohibition on voluntary waste, natural resources may be consumed in three situations: (1) for the repair and maintenance of the property; (2) with permission of the grantor; or (3) under the open mines doctrine. Because the tenant cut down the trees in order to repair and maintain the property, he will not be required to reimburse the man for their value.
Discussion of incorrect answers:
Incorrect. No, because of the open mines doctrine. Under the open mines doctrine, if the grantor or landlord was exploiting the natural resources of the property, it is presumed that the grantee or tenant has the right to continue that exploitation. In this situation, the removal of natural resources by the tenant will not be considered voluntary waste. However, this doctrine is not applicable on these facts. While the man’s family had been selling timber off the property for over a century, it had never allowed the resources on the land surrounding the log cabin to be exploited, and that property is what was leased to the tenant. Instead, the tenant will not be liable for the decreased value of the property because he removed the trees in order to repair and maintain the property, which is a permissible use and not considered voluntary waste.
Incorrect. Yes, because the tenant committed voluntary waste. When a tenant voluntarily commits an act that has more than a trivial injurious effect on or change in the property, the tenant has committed voluntary waste. However, despite the prohibition on voluntary waste, natural resources may be consumed in three situations: (1) for the repair and maintenance of the property; (2) with permission of the grantor; or (3) under the open mines doctrine. Because the tenant cut down the trees in order to repair and maintain the property, he will not be required to reimburse the man for their value.
Incorrect. Yes, because the tenant committed ameliorative waste. Ameliorative waste occurs when a tenant commits an act that increased the value of the premises by permanently altering it. Traditionally, ameliorative waste was prohibited, but under modern law, a tenant is allowed to commit ameliorative waste under certain situations. However, the tenant here did not commit ameliorative waste; the tenant committed voluntary waste, if anything. Further, the tenant will be allowed to use the resources in this way, and will not be liable, because he cut down the trees to repair and maintain the property.
A city installed several hundred new public restrooms on its sidewalks. Each restroom was a self-contained unit; insertion of a quarter opened the locked door. The units were selfsanitizing; when activated, powerful jets of hot water and disinfectant cleansed the interior. The cleaning cycle could only be activated by a switch contained in a locked recess in the rear of the unit; only specially designated municipal employees carried the key to the recess. These employees patrolled the various units, inspecting them for damage and, after insuring that no one was inside, unlocking the cleaning switch and activating the cleansing cycle. A man brought an action against the city for personal injuries. At trial, the above facts concerning the public restrooms were established. The man introduced additional proof that he had deposited a quarter and entered one of the units early one weekday morning when no one was in sight on the city sidewalk, that while he was inside the cleansing cycle was activated, causing him severe injury, that after his screams attracted a passing police officer who pulled him from the unit, the recess containing the activation switch was locked, and that subsequent tests established that the unit was functioning properly.
Should the man recover for his injuries suffered in the public restroom?
A. No, because the man failed to introduce any evidence of negligence on the part of the city.
B. No, because the man was a licensee and there was no evidence that the public restroom unit had malfunctioned.
C. Yes, because the city is strictly liable for operating what amounted to an ultrahazardous activity.
D. Yes, because an employee of the city must have negligently activated the cleansing cycle of the unit without checking to see if anyone was inside.
D. Yes, because an employee of the city must have negligently activated the cleansing cycle of the unit without checking to see if anyone was inside.
A chemist owned a house that he leased to a tenant pursuant to a residential month-to-month lease agreement. Five months after executing the lease agreement with the tenant, the chemist assigned his interest in the lease to his mother. The written lease agreement did not address assignments.
What is the status of the lease?
(A) The chemist is the landlord under the terms of the lease, because the assignment is invalid.
(B) The chemist’s mother is the landlord under the terms of the lease, because a landlord under either a residential or a commercial periodic lease may assign his lease interest.
(C) The chemist’s mother is the landlord under the terms of the lease, because the lease was a residential lease.
(D) Neither the chemist nor his mother is the landlord under the terms of the lease, because the lease terminated upon the chemist’s attempted assignment.
(B) The chemist’s mother is the landlord under the terms of the lease, because a landlord under either a residential or a commercial periodic lease may assign his lease interest.
On July 1, a college senior entered into an oral agreement with a landlord to lease an apartment near her college campus for $750 per month for a period of one year, starting immediately. At the end of the year, having found a job nearby following her graduation, the college senior began looking for a new apartment. Because she did not find one right away, however, she remained in the apartment through the month of July. She did not, however, pay any rent to the landlord.
What is the relationship between the parties as of August 1?
A A month-to-month periodic tenancy has been formed.
B Because the original lease agreement was not in writing, the Statute of Frauds will operate to invalidate the agreement, resulting in an at-will tenancy.
C The college senior is a tenant at sufferance, and the landlord may immediately evict her.
D The landlord cannot evict the college senior without providing at least 30 days’ notice, but may collect rent from the senior according to the lease terms.
C The college senior is a tenant at sufferance, and the landlord may immediately evict her.
Discussion of correct answer: A tenancy at sufferance occurs when a tenant remains in possession of the leased premises (“holds over”) after the end of the lease term. A tenancy at sufferance is not a true tenancy. In most states, if a residential tenant holds over, the landlord may recover possession of the premises and receive the reasonable rental value for the holdover period. Here, the college senior remained in possession of the apartment after the end of the lease term. If the college senior had paid her rent for the month of July on time and the landlord had accepted it, a month-to-month periodic tenancy would have been formed, requiring the landlord to provide notice before terminating the tenancy. However, because she did not do so, she remains on the property as a tenant at sufferance, and the landlord may immediately evict her and collect the reasonable rental value of the apartment for the month of July.
Discussion of incorrect answers:
Incorrect. A month-to-month periodic tenancy has been formed. A lease for a term of years has a definite beginning and end date (e.g., the lease expires on a set date or remains in effect only for a set number of months or years). No notice is required to terminate a lease for a term of years at the end of the specified duration. A periodic tenancy may be created expressly or by implication, as in the case where a holdover tenant pays rent after the end of the lease agreement and the landlord accepts the payment. Here, the one-year oral lease agreement, running from July 1 through June 30, was a lease for term of years, which ended on June 30. The college senior then became a holdover tenant on July 1. Because there was no rent payment made and accepted for the month of July, the college senior will remain a tenant at sufferance, permitting the landlord to immediately evict her and collect the reasonable rental value of the apartment for the month of July.
Incorrect. Because the original lease agreement was not in writing, the Statute of Frauds will operate to invalidate the agreement, resulting in an at-will tenancy. A lease may be created expressly, either orally or in writing. A writing is generally required by the Statute of Frauds for leases with a term of more than one year. An implied lease may be also created, as when a holdover tenant pays rent and the landlord accepts the payment. Here, the term was for one year. However, the lease had already been fully performed, because the one-year period had elapsed. As of the following July 1, the college senior became a holdover tenant. Thus, the Statute of Frauds is inapplicable.
Incorrect. The landlord cannot evict the college senior without providing at least 30 days’ notice, but may collect rent from the senior according to the lease terms. Had the college senior paid rent for the month of July after holding over and the landlord accepted the payment, a month-to-month periodic tenancy would have been created. Once a periodic tenancy existed, the landlord would have been required to provide notice to the college senior before terminating the lease. The notice would need to have been given at least one rental payment period prior to the termination date. However, no periodic tenancy was created here; instead, the college senior remains as a tenant at sufferance. As such, the landlord is entitled to immediately evict the college senior. Additionally, when the tenant is a holdover tenant, the landlord is entitled to collect the reasonable rental value of the property for the holdover period, and is not limited to the rent payment specified in the previous lease.
A patron checked into a hotel. The hotel’s outer structure had been built as a replica of the classic Roman style of architecture with Ionic columns and marble frescoes draped over the entrance. The elaborate entryway led inside to a variety of shops and restaurants that adjoined the hotel lobby. The hotel management knew that pigeons often nested inside the overhead sculptures. This resulted in pigeon droppings frequently falling outside the main entryway. Consequently, the hotel management instructed its employees to clean the area around the front entrance on a daily basis. One afternoon, one of the patron’s friends came by the hotel to pay a visit. As the friend walked under the columns to enter the hotel, he slipped on some pigeon droppings that had not been wiped up. On this particular day, the hotel employees had failed to clean the entrance area. Injuring his leg, the friend now brings suit against the hotel.
In his personal injury action, will the friend recover?
(A) Yes, because the hotel employees knew of the dangerous condition and failed to remedy it in a timely manner.
(B) Yes, because the hotel employees had not cleaned the entryway.
(C) No, because the friend was not a paying guest of the hotel.
(D) No, because the hotel is only responsible for natural conditions on the land.
(A) Yes, because the hotel employees knew of the dangerous condition and failed to remedy it in a timely manner.
A landlord and a doctor entered into a written lease agreement for the lease of an apartment owned by the landlord. Under the terms of the lease agreement, the doctor was to rent the apartment from the landlord for a period of one year. On the day the lease commenced, the doctor found he could not gain access to the apartment, because the landlord had changed the locks.
Has the landlord breached his duty to deliver possession of the premises to the doctor?
(A) Yes, under the American rule, because the landlord has not delivered actual possession of the premises to the doctor.
(B) Yes, under the minority rule, because the landlord has constructively evicted the doctor.
(C) No, under the minority (American) rule, because the doctor has a legal right to possess the premises.
(D) No, under the majority (English) rule, because a lease for a term of years may be terminated at will.
(C) No, under the minority (American) rule, because the doctor has a legal right to possess the premises.
A great-uncle conveyed his farm to his grandniece and grandnephew as joint tenants. Neither the grandniece nor the grandnephew worked on the land, but they hired a local farmer to plant crops. Four years later, the grandniece granted a mortgage interest in her joint tenancy property to a bank to secure a debt. The term of the mortgage was 10 years. The grandniece paid on the debt for seven years, then died, leaving a will devising her real property to her son. Assume that the jurisdiction follows the lien theory.
If the grandnephew brings an action to quiet title to the land, how will the court find?
The grandnephew owns the land.
The grandnephew and the grandniece’s son hold the land as tenants in common because the mortgage severed the joint tenancy.
The grandnephew and the grandniece’s son hold the land as tenants in common, subject to the bank’s mortgage.
The grandnephew owns the land, subject to the mortgage.
The correct answer is: The grandnephew owns the land.
Discussion of correct answer: The grandniece’s joint tenancy interest in the land passed automatically by right of survivorship to the grandnephew when she died. The grandniece’s mortgaging of her joint tenancy interest in the land did not sever the joint tenancy because the land is in a lien theory jurisdiction. Under the lien theory, a mortgage constitutes a lien on the property (rather than a severance of title as in a title theory jurisdiction), and the joint tenancy is not severed.
On February 1, the owner of a parcel delivered a deed to a woodcutter granting him a profit in gross in the land. As holder of the profit, the woodcutter was entitled to enter the land for the purpose of cutting and taking any timber growing on the property. On April 1, the owner entered into a contract to sell the land to a buyer. On April 15, in exchange for $50,000, the owner delivered a warranty deed for the land to the buyer. On April 30, the woodcutter properly recorded his interest in the land. The buyer did not discover the woodcutter’s interest in the land until May 2, when the buyer happened to notice the woodcutter leaving the land driving a truck loaded with cut timber. That same day, the buyer recorded his deed to the land.
Under which type of recording act will the buyer prevail?
A notice recording act.
A race recording act.
A race-notice recording act.
All of the above, because the woodcutter’s profit in gross cannot be protected by a recording act.
The correct answer is:A notice recording act.
Discussion of correct answer:Under the common law, priority is generally awarded to the grantee who was first to receive an interest from the grantor (this is known as “first-in-time, first-in-right”). A recording act may alter the outcome, depending on whether it is a race, notice, or race-notice type of act. Under a notice-type recording act, a subsequent bona fide purchaser who takes for value and without notice of the prior conveyance will prevail over a grantee who failed to record his interest prior to the date of the conveyance to the subsequent purchaser. The buyer purchased the land without notice of the woodcutter’s interest, because the woodcutter did not record the profit until after the conveyance. Thus, the buyer will prevail under a notice recording act, despite the fact that he recorded after the woodcutter did so.
A man bought a house from a woman. The house was encumbered by a mortgage that was recorded. The man bought the house subject to the mortgage and took over the mortgage payments. The man subsequently sold the house to an investor who was aware of the mortgage. The investor bought the house by an installment land-sale contract that made no mention of the mortgage. After receiving just two of the 20 agreed upon payments under the installment land-sale contract, the man stopped making payments on the mortgage. The mortgagee-initiated foreclosure proceedings.
What will happen to the house and the debt?
(D) The mortgagee may foreclose on the property and hold the woman personally liable for any debt remaining after the foreclosure sale.
(C) The mortgagee may foreclose on the property and hold the man personally liable for any debt remaining after the foreclosure sale.
(B) The mortgagee may foreclose on the property and hold the investor personally liable for any debt remaining after the foreclosure sale.
(A) The mortgagee is estopped from foreclosing on the property, because the last purchaser is a bona fide purchaser.
(D) The mortgagee may foreclose on the property and hold the woman personally liable for any debt remaining after the foreclosure sale.
In 2005, an owner conveyed his real property to his son and daughter as joint tenants with rights of survivorship. Two years later, the son executed a mortgage on the property to a bank to secure a loan. A couple of months after this, the son died intestate, leaving one child as his only heir. At the time of the son’s death, the mortgage had not been paid to the bank. The jurisdiction in which the property is located recognizes a title theory of mortgages.
In an appropriate action, the court should determine that title to the property is vested in whom?
The daughter, with the entire interest subject to the mortgage.
The daughter, free and clear of the mortgage.
Half in the daughter and half in the child, with both subject to the mortgage.
Half in the daughter, free of the mortgage, and half in the child, subject to the mortgage.
The correct answer is: Half in the daughter, free of the mortgage, and half in the child, subject to the mortgage.
Discussion of correct answer: In a title theory state, the execution of a mortgage by one joint tenant causes the legal interest of that co-tenant to be transferred to the mortgagee. As a result, the mortgage severs the joint tenancy, because the unities (of title and interest) have been destroyed. This severance results in the mortgaging co-tenant having a tenancy in common with the remaining co-tenant(s). (As a note, if there is more than one remaining co-tenant, their interest remains a joint tenancy with respect to each other, and a tenancy in common with respect to the mortgaging co-tenant.) Furthermore, because a tenancy in common has no unity of interest, the daughter’s undivided one-half interest in the property was not encumbered by the son’s mortgage. The daughter will take free of the mortgage, whereas the child will take subject to the mortgage.
A young man executed a written deed conveying his vineyard to his handyman, which the handyman properly recorded. The young man had a successful ice skating career, but lost a breach of contract case when he refused to perform a show. The backers of the show, who had no actual notice of the earlier conveyance of the property and did not make a search of the title records, promptly recorded a judgment lien against the vineyard. The state recording act reads, “A conveyance of an estate in land shall not be valid as against any judgment creditor, except such persons having notice of it, unless the conveyance is properly recorded.”
Will the court enforce the judgment lien against the vineyard?
(A) No, because the backers are not purchasers for value.
(B) No, because the handyman properly recorded the deed to the property.
(C) Yes, because as a donee, the handyman was not a purchaser for value, mortgagee, or judgment creditor protected by the state’s recording act.
(D) Yes, because the prompt recording of the judgment lien revoked the earlier deed of the property to the handyman.
(B) No, because the handyman properly recorded the deed to the property.
Two brothers–a chef and a golf pro–lived on a 50-acre parcel of land that their late father had bequeathed to them as tenants in common. They occupied a two-bedroom cabin located near the eastern boundary of the parcel. To the west was a larger parcel owned by a writer. Two years after their father’s death, the chef and the golf pro had a disagreement; the golf pro moved out of the cabin and into an apartment. A year after the golf pro left, the writer telephoned the chef and said that he wanted to construct a chainlink fence on their boundary line. Unfortunately, the writer said, the terrain was so rugged that a survey would add several thousand dollars to the cost of the fence. The writer therefore proposed that they obtain a map, agree on a reasonable location for the fence, and let that serve as the boundary between the two parcels. The chef agreed, and the writer subsequently built a chain-link fence along the line they selected.
Three years later, the chef died intestate, leaving the golf pro as his only heir. The golf pro returned to the property, had a survey performed, and learned that the chain-link fence significantly encroached upon his property. He brought an action to seek redress for this encroachment.
Who should prevail in this action?
(A) The golf pro, because the agreement between his brother and the writer was not in writing.
(B) The golf pro, because he had no notice of the agreement between his brother and the writer.
(C) The writer, because the chef was entitled to establish the boundary between their two parcels by agreement.
(D) The writer, because the golf pro was “ousted” from the tenancy in common when he moved to his apartment.
(C) The writer, because the chef was entitled to establish the boundary between their two parcels by agreement.
A purchaser wished to construct an industrial complex. On August 15, a seller and the purchaser entered into a written agreement that provided, among other things, as follows: “The seller hereby agrees to sell the seller’s unimproved property consisting of 40 acres to the purchaser for the price of $400,000. The seller shall convey good and marketable title. Closing of escrow is to occur no later than December 1. This agreement will be void if the seller cannot close and convey good and marketable title on December 1.”
On October 20, the seller discovered a 20-year-old easement running through the center of the property that a former owner had granted to the city when a mass transit rail line had been in the planning stages. The rail system had been abandoned when voters refused to support an increase in a local tax to finance construction. The seller immediately notified the purchaser of the easement and that she had begun negotiations with the city manager and the city planning commission to repurchase the easement and thereby extinguish it. On November 20, the purchaser telephoned the seller and asked about progress on the easement repurchase. The seller stated that a few holdovers on the planning commission were arguing to retain the easement, but that she had the votes to swing the commission her way, given enough time. “Do your best,” was the purchaser’s only response. Due to the Thanksgiving holiday, the planning commission did not vote on the easement repurchase issue until November 30, but voted to sell the easement back to the seller. The city manager’s office could not process the paperwork necessary to effectuate the sale of easement rights to the seller until December 2, on which day the seller deposited into escrow a warranty deed conveying good and marketable title to the subject property to the purchaser. The purchaser refused to pay the purchase price and declared that the contract had been rescinded. The seller sought specific performance in an appropriate legal action.
Assuming the seller prevails, which of the following is the best support for the court’s decision?
Time was not of the essence in the agreement between the seller and the purchaser.
Delayed performance can never be considered a total breach of a land sale contract.
The purchaser led the seller to believe that strict adherence to the time of the essence clause would not be insisted upon.
The purchaser would be unjustly enriched if permitted to rely upon one day’s delay in performance as justification for rescinding the contract.
The correct answer is: The purchaser led the seller to believe that strict adherence to the time of the essence clause would not be insisted upon.
Discussion of correct answer: Ordinarily, failure to perform a contractual obligation by the time specified in the contract is a non- material breach of the agreement. It permits the aggrieved party to recover damages caused by the breach, but is not so serious to be considered a material or total breach that the aggrieved party is excused from performing, and that party may not properly regard the contract as terminated. So long as the “late” party tenders performance within a reasonable time, the breach is cured, and if the aggrieved party refuses to perform, the late party may obtain specific performance. This situation is reversed if the contract is “time is of the essence.” Where a contract states that “time is of the essence,” late performance is a total breach, and the aggrieved party is excused from performance. The late party may not compel specific performance by tardily tendering his performance. Merely establishing a date for performance is not sufficient to make time of the essence; there must be some additional language such as “time is of the essence” or “this agreement is null and void if performance is not tendered upon the date specified,” indicating that timely performance will be critical. Even where time is of the essence, the courts are often hostile to a strict enforcement of such clauses, frequently finding waiver of the importance of timely performance in written or oral statements or from the circumstances. In this problem, the purchaser’s response to the seller’s November 20 progress report regarding negotiations with the city planning commission (“Do your best”) could be construed as a waiver of the right to demand performance by December 1. Thus, this is the best argument in support of specific performance for the seller.
A young man spent some time chatting and drinking beer in the front yard with his friends after their softball league game. By the time the friends leave and he enters his house he is drunk, and he accidentally leaves his baseball bat on the sidewalk. The next morning, a woman in a convertible drove by the young man’s house. The woman was checking her makeup in her rear-view mirror, and before she realized it, she had veered off the road and onto the sidewalk. The convertible’s tire struck the baseball bat that the young man had left on the sidewalk, sending it flying into the air. The bat hit the woman in the head, severely injuring her. She filed suit against the young man for negligence.
Will she prevail?
A. No, because the young man was drunk and it was foreseeable that he would leave his bat on the sidewalk.
B. No, because people do not usually drive on the sidewalk.
C. Yes, because the young man should not have left his bat on the sidewalk.
D. Yes, because but for the young man’s act, the driver would not have been injured.
B. No, because people do not usually drive on the sidewalk.
When Grantor retires from his cold Northern state to someplace warmer, he wants his daughter and son to be able to keep the old homestead. He conveys the homestead to them both by stating, “to Daughter and Son as joint tenants, and not as tenants in common, with right of survivorship.” Both Daughter and Son revise their wills to include bequests to their children. Daughter bequeaths her property to Grantor’s two grandsons as tenants in common. Son bequeaths his interest to Grantor’s granddaughter, who is married.
If Daughter predeceases Son, what interest does the granddaughter stand to inherit?
A tenancy in common with the two grandsons.
A joint tenancy with the two grandsons.
A tenancy by the entirety with her spouse.
Complete ownership of the property.
The correct answer is: Complete ownership of the property.
Discussion of correct answer: In this example, granddaughter winds up with the entire property. When Daughter predeceases Son, the entire property belongs to Son because Daughter and Son had a joint tenancy with right of survivorship. Although the granddaughter is married, a bequest to her does not automatically include her spouse in a tenancy by the entirety. She therefore would take complete ownership.
A landlord entered into a lease agreement with a tenant pursuant to which the landlord was required to pump out and empty the house’s small septic tank every six months, on January 1 and July 1. During the second year of the lease, the landlord failed to pump the tank in July despite repeated complaints by the tenant, and as a result, the property was suffused with a foul order for the entire month. The tenant remained in the apartment. When the landlord finally arrived to pump the tank at the beginning of August and demanded the previous month’s rent, the tenant refused to pay. The landlord then sued the tenant for the unpaid rent.
Under the majority rule, what remedy is the tenant entitled to pursue?
A The tenant is entitled to a rent abatement, because the landlord has breached the covenant of quiet enjoyment, but he is not relieved of all liability for rent.
B The tenant may withhold the entire rent, because he has been constructively evicted.
C The tenant may not withhold the entire rent, because he has merely been constructively evicted.
D The tenant may not withhold the entire rent, because he remained in the apartment.
D The tenant may not withhold the entire rent, because he remained in the apartment.
Discussion of correct answer:Under the majority rule, a tenant may treat a lease as terminated if the landlord breaches the covenant of quiet enjoyment (express or implied in every lease) by constructive eviction of the tenant. In order for a constructive eviction to exist: (1) the landlord must substantially and permanently interfere with the tenant’s use and enjoyment of the premises; and (2) the tenant must move out. In this case, because the tenant did not move out, he has not been constructively evicted, and therefore may not withhold the rent.
Discussion of incorrect answers:
Incorrect. The tenant is entitled to a rent abatement, because the landlord has breached the covenant of quiet enjoyment, but he is not relieved of all liability for rent. This answer not only makes an erroneous assumption but also applies an incorrect rule of law. If a landlord breaches the covenant of quiet enjoyment, such as by an actual or constructive eviction, a tenant may treat the lease as terminated and withhold rent. Thus, in this case, if the landlord had in fact breached the covenant of quiet enjoyment by constructively evicting the tenant, the tenant would have been entitled to withhold the entire rent, not merely a rent abatement. Moreover, given that the tenant did not move out or abandon even a part of the premises, he was not constructively evicted. Therefore, the landlord will be deemed not to have breached the covenant of quiet enjoyment.
Incorrect. The tenant may withhold the entire rent, because he has been constructively evicted. In order for a tenant to be constructively evicted: (1) the landlord must substantially and permanently interfere with the tenant’s use and enjoyment of the premises; and (2) the tenant must move out. In this case, while the first of these requirements was met, the second was not, because the tenant did not move out. Therefore, the tenant has not been constructively evicted and cannot withhold the entire rent.
Incorrect. The tenant may not withhold the entire rent, because he has merely been constructively evicted. This answer makes an assumption not supported by the facts as well as applies an incorrect rule of law. In order for a constructive eviction to exist: (1) the landlord’s act must substantially and permanently interfere with the tenant’s use and enjoyment of the premises; and (2) the tenant must move out. Here, because the tenant did not move out or abandon even a part of the premises, the tenant was not constructively evicted. Moreover, if the tenant had been constructively evicted, he would have been entitled to withhold the entire rent, or receive an abatement if only partially constructively evicted.
On December 1, 2050, a businessman executed a written 10-year agreement leasing a business property he owned to a restaurateur. The jurisdiction has a Statute of Frauds requiring that a lease for more than two years be written to be enforceable. On March 1, 2057, the restaurateur assigned the lease to a shoe salesman who was opening a shoe store. Neither the restaurateur nor the shoe salesman gave the businessman any notice of the assignment.
Is the assignment valid?
Yes, if the assignment was in writing and the lease did not specifically prohibit an assignment.
Yes, whether or not the assignment was in writing.
No, because no one gave the businessman notice of the assignment.
No, because the lease contained no clause specifically allowing an assignment.
The correct answer is: Yes, if the assignment was in writing and the lease did not specifically prohibit an assignment.
Discussion of correct answer: A lease may be freely assigned unless its terms expressly prohibit it. However, to satisfy the jurisdiction’s Statute of Frauds, the assignment must be in writing, because more than two years remained on the lease.
A father devised his property “to my daughter for life with remainder to such of her children as should be living at her death, provided, however, that no such child of my daughter shall sell, mortgage, or otherwise transfer his or her interest in the property prior to attaining age 20; and if any such child of my daughter shall violate this provision, then upon such violation, his or her interest shall pass to the remaining children of my daughter then living.” The will devised the residuary of the father’s estate to his wife.
The father died and was survived by his wife, daughter, and the daughter’s three children. The wife brought an action for a declaration of rights, claiming that the attempted gifts to the father’s grandchildren were entirely void and that the interest following the life estate to his daughter passed to the wife absolutely by the residuary clause. Assume that the action was properly brought with all necessary parties and with a guardian ad litem appointed to represent the interests of unborn and infant grandchildren.
How should the court decide?
The attempted gifts to grandchildren are void under the Rule Against Perpetuities.
The attempted gifts to grandchildren are void as unlawful restraints against alienation.
The provisions concerning the grandchildren are valid and will be upheld according to their terms.
Even if the provisions against sale, mortgage, or other transfer by the grandchildren are void, the remainders to grandchildren are otherwise valid and will be given effect.
The correct answer is: Even if the provisions against sale, mortgage, or other transfer by the grandchildren are void, the remainders to grandchildren are otherwise valid and will be given effect.
Discussion of correct answer: A restraint against alienation of an inheritable future interest is void where the restraint may continue in effect after the future interest becomes possessory. Similarly, a restraint against alienation applied to an inheritable future interest is void to the same extent that the restraint would be void if the future interest were presently possessory (i.e., if the future interest will result in a fee simple, the restraint is void from its inception). In this question, if the daughter dies with a surviving child under age 20, then the restraint on alienation will continue in effect after that child’s remainder interest becomes possessory, and thus the restraint is void. The effect of voiding the restraint is that the children take free of the restraint. The validity of the gifts to them, therefore, is not affected.
A man and woman each owned adjoining parcels of land. The man constructed a house on his lot and resided there with his wife and three children. The woman resided in another state. Twenty-five years ago, the man built a tennis court in the backyard of his lot. Unbeknownst to the man, the tennis court extended three feet onto the woman’s lot.
The woman had no knowledge of the encroachment until this year, when she returned for the first time since she purchased it. When she inspected her lot, she ascertained that the man’s tennis court extended beyond the property line. The statutory period for both adverse possession and prescriptive easements is 20 years.
If the woman now brings an action against the man alleging encroachment, for whom should the court rule?
The woman, because the man was unaware that his possession was adverse.
The woman, because the man failed to exercise any acts of dominion that would exclude the woman from the three- foot strip.
The man, because his possession was hostile.
The man, because the woman’s conduct manifests an intent to abandon any claim she might have had to an exclusive right in the three-foot strip.
The correct answer is: The man, because his possession was hostile.
Discussion of correct answer: The man’s possession was (1) actual and exclusive; (2) open, visible, and notorious (i.e., not secret or clandestine, but rather, occupying as a true owner); (3) continuous (without abandonment or a physical hiatus in occupancy); (4) hostile and adverse; and (5) for the statutory period. The key element in this question is hostile and adverse. Under the majority view, it is generally stated that the adverse possessor must intend to hold adversely against the whole world, including the rightful owner. The motives of the adverse possessor are irrelevant. Whether he intends a wrongful disseisin or whether he occupies what he believes to be his own, he acquires title, because it is the visible and adverse possession with intent to possess that constitutes its adverse character, not the remote views or mistaken belief of the possessor [Schertz v. Rundles, 363 N.E. 2d 203 (1977)]. It is clear that the man intended to possess the strip under the tennis court, believing that it was his own property. Therefore, because the man’s possession was both adverse and hostile, the woman will not prevail in an action for encroachment. The man has obtained title to the three-foot strip by adverse possession.
A seller learned that her friend was looking for a home in the area. The friend loved the seller’s home and offered to purchase it. However, the friend had very little money, and offered to purchase the home at a price which was substantially lower than the price the seller hoped to get for the property. Despite the low offer, the seller was eager to sell her house, and she agreed to sell the home to her friend for a reduced price subject to the mortgage that the seller already had on the property. The seller immediately stopped making mortgage payments on the home. Unfortunately, the friend did not make any payments either. The outstanding balance on the home was $200,000, but the market value of the home was only $150,000.
Which of the following is correct?
(A) The mortgagee cannot foreclose upon the property, but the friend is personally liable for the debt.
(B) The mortgagee cannot foreclose upon the property, and the friend is not personally liable for the debt.
(C) The mortgagee may foreclose upon the property, but the friend is not personally liable for the debt.
(D) The mortgagee may foreclose upon the property, and the friend is personally liable for the debt.
(C) The mortgagee may foreclose upon the property, but the friend is not personally liable for the debt.
Tom devised Blackacre to Larry and Dahlia in equal shares. A year later, Larry conveyed his interest in Blackacre to Paul. Larry subsequently died, and Paul brought an action to partition Blackacre. The jurisdiction has no statute directly applicable to the relevant issues.
What is the most likely reason why Dahlia would be declared the sole owner of all of Blackacre?
(A) The estate created in Larry and Dahlia by Tom’s will was a joint tenancy.
(B) The estate created in Larry and Dahlia by Tom’s will was a tenancy by the entirety.
(C) The estate created in Larry and Dahlia by Tom’s will included the right of survivorship.
(D) The estate created in Larry and Dahlia by Tom’s will was a fee rather than a life estate.
(B) The estate created in Larry and Dahlia by Tom’s will was a tenancy by the entirety.
Greenwood was a 500-acre parcel of land which bordered on Rural Highway, a two-lane country road. In 1950, the owner of Greenwood decided to subdivide Greenwood into 50 10-acre lots. He then sold each lot, and placed a restriction in each deed limiting development to residential use. Each deed was properly recorded.
Starting in 2000, a number of changes took place; the property surrounding Greenwood changed from entirely residential to almost entirely commercial, many of the homes in the Greenwood development were abandoned and fell into disrepair, some of the lots in Greenwood had been converted to commercial use, and Rural Highway was widened to three lanes in each direction to accommodate the increasing commercial traffic.
In 2010, the current owner of Lot 28 in the Greenwood subdivision sold the property to a businessman. The businessman desired to tear down the residential home on Lot 28 and build a factory.
What would be the businessman’s strongest argument as to why the restriction limited development to residential use should not be enforced?
Because over 60 years have passed since the restriction was first placed in the deeds, its enforcement would be barred by laches.
There has been a change to the neighborhood which should prevent enforcement of the restriction.
The continued enforcement of the restriction would amount to an unreasonable restraint on alienation.
Any suit to enforce the restriction would be barred by the statute of limitation.
The correct answer is: There has been a change to the neighborhood which should prevent enforcement of the restriction.
Discussion of correct answer: Under the “change of neighborhood” doctrine, when the neighborhood in which the burdened land is located has so changed that it would be inequitable to continue to enforce the restriction it will not be enforced. Here, it is clear that such changes have taken place so that the restriction should no longer be enforced.
A man was the record title owner of Casa de Sol, a beautiful 12-acre hacienda estate, in fee simple absolute. In 2005, the man conveyed Casa de Sol to his friend for life with remainder to the man’s daughter. The friend took possession of the property and, two years later, sold it to a buyer for $200,000. The following year, the daughter died and was survived by her son as sole heir. The buyer has now indicated a desire to sell the property. A dispute has arisen as to legal title to the property. The man, the friend, and the son are still alive.
Which of the following best describes the state of title to Casa de Sol?
(A) The son has a fee simple.
(B) The buyer has a life estate, and the man has a reversion.
(C) The buyer has a life estate for the life of the friend with a remainder in the son.
(D) The buyer has a life estate with a vested remainder in the son, subject to the man’s reversionary interest.
(C) The buyer has a life estate for the life of the friend with a remainder in the son.
A laboratory manufactured nitroglycerin (a chief ingredient in dynamite) at its plant. An artist who specialized in making glass sculptures had a studio two blocks away from the laboratory’s plant. One evening, an explosion at the laboratory’s plant caused the artist’s studio to shake, resulting in the destruction of valuable artwork. The artist brought a tort action against the laboratory to recover damages.
Which of the following, if established, would furnish the laboratory with its best possible defense?
(A) The laboratory used extraordinary care in the manufacture and storage of nitroglycerin and was not guilty of any negligence that was causally connected with the explosion.
(B) The laboratory has a contract with the federal government whereby all the nitroglycerin manufactured at its plant is used in U.S. military weapons systems.
(C) The explosion was caused when lightning (an act of God) struck the plant during an electrical storm.
(D) The harm that the artist suffered would not have resulted but for the abnormal fragility of the artist’s work.
(D) The harm that the artist suffered would not have resulted but for the abnormal fragility of the artist’s work.
A daughter needed to obtain residential care for her father. The daughter’s aunt planned to convey her property to a charity. However, the aunt told the daughter she would give her a life estate in the property so the daughter could use the income for her father’s care. The deed granted the property “to [the daughter], for the life of [the father], then to [the charity].”
What interest, if any, does the daughter have in the property?
(A) A life estate.
(B) A life estate pur autre vie.
(C) A fee simple determinable.
(D) A fee simple subject to a condition subsequent.
(B) A life estate pur autre vie.
A property developer and a real estate broker entered into a contract of sale, with the developer agreeing to sell his cabin to the broker for $100,000. At closing, the developer gave the broker a general warranty deed, and the broker handed the developer a cashier’s check for the full purchase price. The broker promptly recorded the deed, then sold the property to his dentist, also by general warranty deed. Many years later, the dentist was mending the fence that encircles the land when he found an eviction notice from the bank, which was commencing foreclosure proceedings against the developer’s father for defaulting on a mortgage to the property. The dentist then spoke to the bank and discovered that the developer had indeed sold the property to his own father one week before completing the transaction with the real estate broker.
Can the dentist recover from the developer?
(A) Yes, because the dentist is a bona fide purchaser for value.
(B) Yes, because the covenant for quiet enjoyment runs with the land.
(C) No, because only the real estate broker could recover from the developer.
(D) No, because the covenant against encumbrances is a present covenant.
(B) Yes, because the covenant for quiet enjoyment runs with the land.
A homeowner gave a mortgage on a property to a third-party lender for $4 million, $2.5 million to buy the property and $1.5 million to make improvements on it.
Which of the following is true?
(A) This mortgage is not a purchase-money mortgage, because a portion was used to make improvements on the land.
(B) This mortgage is not a purchase-money mortgage, because the mortgage was given as part of the same transaction in which the homeowner acquired title to the property.
(C) This mortgage is a purchase-money mortgage, and as such, it does not have priority over any pre-existing liens on the property.
(D) This mortgage is a purchase-money mortgage, and as such, it has priority over all prior liens that attach to the property through the actions of the homeowner.
(D) This mortgage is a purchase-money mortgage, and as such, it has priority over all prior liens that attach to the property through the actions of the homeowner.
As a tribute to his great body of legal work, a professor of property law established a library on his 10-acre estate. After several years of operating the library at a loss, the professor decided to sell the property. The professor conveyed the property by a duly executed deed “to librarian, but if the premises cease to be used for educational purposes, then to my alma mater.” One night, the librarian served his friend a beer on the premises. The professor’s alma mater filed suit claiming ownership. Assume that all interests satisfy the Rule Against Perpetuities.
Should the alma mater prevail?
No, because the professor holds a fee simple subject to condition subsequent.
No, because the librarian holds a fee simple subject to an executory interest.
Yes, because the alma mater holds a fee simple subject to a shifting executory interest.
Yes, because the estate will be automatically divested in favor of the alma mater.
The correct answer is: No, because the librarian holds a fee simple subject to an executory interest.
Discussion of correct answer: A fee simple subject to an executory interest is an estate that is automatically divested to a third person upon the occurrence of a named event. In this case, the professor deeded the property to the librarian, with the condition that the alma mater receives the property if the premises cease to be used for educational purposes. But in this case, the fact that the librarian served his friend a beer does not indicate that the premises have ceased to be used for educational purposes. The librarian will prevail because he holds the estate in fee simple subject to an executory interest and the named event that would cause transfer of the property has not occurred.
A homeowner sold property to his niece. The niece intended to record her deed, but planned to wait until the next week. She told her cousin about her plans, though, and showed him the deed. The cousin immediately went to the homeowner and convinced him to sell the property to him. The homeowner executed a deed, and the cousin took the deed and recorded it. The niece attempted to record her deed the next week as she had planned. The jurisdiction has a race recording statute.
Does the cousin have a superior claim to the property?
(A) No, because the cousin had actual notice of the conveyance to the niece.
(B) No, because the niece had the first deed.
(C) Yes, because he recorded his deed first.
(D) Yes, because the cousin was a purchaser for value.
(A) No, because the cousin had actual notice of the conveyance to the niece.
A restaurant owner ran a small restaurant in a suburban community, which he opened for dinner at 3:00 p.m., seven days a week, even though business was often slow at that hour. One rainy afternoon, a young couple stopped in for an early dinner just as the restaurant was opening. After finishing his meal, the man left the restaurant and went to pick up the couple’s car, so that his wife would not have to walk to the parking lot in the rain. Just as the man stepped off the curb onto the street, an elderly driver came around a blind corner and hit the man with his vehicle. The man was knocked to the ground and severely injured. Putting on his emergency lights, the driver got out of his car as quickly as possible and raced into the restaurant. Hearing the driver’s story, the woman begged the restaurant owner to permit her to use the telephone to call an ambulance, but the restaurant owner refused, having a strict “no customer phone use” policy. The woman ran to find another open business and an ambulance arrived 15 minutes later. According to the man’s physician, the delay in treatment allowed a blood clot to form in the man’s brain, which seriously complicated his condition.
If the man sues the restaurant owner, what is the restaurant owner’s best defense?
A. The restaurant owner’s acts were a passive contributor to the man’s injuries while the driver’s acts were primary and active.
B. The man was at fault for walking into the street.
C. The man was no longer a business invitee.
D. The man impliedly assumed the risk by walking into the street.
C. The man was no longer a business invitee.
A man owns a farm which he sells to an investor for $200,000. The farm was located in a state with a race-notice statute. The investor was not as concerned with recording and did not promptly record his deed. The man then transfers title of the farm to his brother as a gift. The brother promptly recorded the deed. Some time later, the investor recorded his deed to the farm. The investor then sued the brother to quiet title.
How should the court resolve the dispute over the farm?
A. The court should find in favor of the brother, because he recorded first.
B. The court should find in favor of the brother, because he took without notice of the deed to the investor.
C. The court should find in favor of the investor, because the brother did not pay value for the property.
D. The court should find in favor of the investor, because he had no notice of the deed to the brother.
C. The court should find in favor of the investor, because the brother did not pay value for the property.
A homeowner currently owes $150,000 on her mortgage. Due to recently losing her job, she has stopped making her monthly mortgage payments. The bank that holds the mortgage has taken the appropriate steps to conduct a judicial foreclosure on the house.
Which of the following is a requirement for a judicial foreclosure sale?
(B) The sale must result in a sale price that is at least the fair market value of the property.
(D) The sale must be conducted pursuant to a power-of-sale clause included in the mortgage documents.
(C) The sale must result in a fair sale price that is not necessarily the fair market value of the property.
(A) The sale must first be a private sale, and then after 30 days it must be made public.
(C) The sale must result in a fair sale price that is not necessarily the fair market value of the property.
A grandfather had a beautifully landscaped backyard including prize-winning apple trees. A competitor was upset that the grandfather kept winning the apple pie contests, so she sent several youths to steal apples from the grandfather’s trees during peak ripeness. The grandfather was upset when the apples began disappearing. To prevent further theft, he tied lengths of fishing line between trees, stretching it tightly about five feet off the ground. It was very difficult to see in the daytime and impossible to see at night. A few nights later, the youths entered the grandfather’s backyard. The grandfather heard them in his backyard, so he turned on the light and yelled, “Get out of here!” The youths began to run in all directions. One of them ran into one of the lengths of fishing line. His throat was cut by the line, and he was severely injured.
If the youth sues the grandfather for damages, should he recover?
A. Yes, because the grandfather used a mechanical device to protect his property.
B. Yes, because, without warning known trespassers, the grandfather used more force than was reasonably necessary to protect his property.
C. No, because the youth was injured when he was trespassing.
D. No, because the grandfather may use force to protect his property.
B. Yes, because, without warning known trespassers, the grandfather used more force than was reasonably necessary to protect his property.
A lumberjack and a truck driver entered into a residential lease. The agreement includes a provision that “the lease term shall continue until the lumberjack, at his sole discretion, terminates the lease.” The jurisdiction follows the majority rule.
Which most accurately describes the type of tenancy created?
A An at-will tenancy that may be terminated by the lumberjack.
B An at-will tenancy that may be terminated by either the lumberjack or by the truck driver.
C A life estate held by the truck driver.
D A periodic tenancy between the lumberjack and the truck driver.
B An at-will tenancy that may be terminated by either the lumberjack or by the truck driver.
Discussion of correct answer: A tenancy that has no fixed duration and lasts only as long as the landlord and tenant desire is an at-will tenancy. In this case, the lease agreement had no fixed duration and provided that only the landlord would have the power to terminate the lease. However, most courts will interpret this language as creating an at-will tenancy that can be terminated by either party. Therefore, this answer choice is correct.
A farmer held record title to a 200-acre orchard in fee simple absolute. On February 15, 2020, the farmer deeded the orchard to his daughter. The daughter did not record the deed. The farmer and his daughter agreed that the farmer could continue to live in the small house on the property, although the daughter was now the owner of the orchard. Based on this understanding, the farmer continued to reside on the orchard grounds. On March 1, 2021, the daughter deeded the orchard to a neighbor by quitclaim deed, in exchange for a payment of $15,000. The neighbor immediately and properly recorded the deed. However, the farmer tended to be forgetful about business matters. On April 1, 2021, the farmer, failing to remember that he had already deeded the property to his daughter, conveyed the orchard to a businessman in exchange for a sum that was slightly less than the fair market value of the property. The businessman immediately and properly recorded his deed. The neighbor and the businessman had no actual notice of their conflicting claims to the land. The jurisdiction had a standard tract index of documents affecting the title to land. The recording statute of the jurisdiction provided that, unless recorded, a deed would have no effect as to a subsequent purchaser for value who takes in good faith and who first records his or her deed.
In a suit over title to the property, which party will prevail?
(A) The neighbor, because he paid value for the property.
(B) The neighbor, because he recorded first.
(C) The businessman, because the neighbor took only a quitclaim deed, which contains no guarantees as to title.
(D) The businessman, because he is a bona fide purchaser for value and had no constructive notice of the prior conveyance.
(B) The neighbor, because he recorded first.
A landlord lived with his two tenants as roommates in a townhouse. The lease agreements specified that each tenant had private access to one of the bedrooms and access to the shared common areas of the house. One day, due to poor upkeep, one of the pipes burst under the kitchen sink, flooding the kitchen and rendering the entire room unusable. The tenants salvaged what they could of their property from the kitchen and complained to the landlord to fix it, but despite constant promises that he would get to it, the kitchen was never repaired.
Are the tenants entitled to withhold their next month’s rent payments?
(A) No, because they are entitled only to a rent abatement.
(B) No, because they did not move out of the townhouse.
(C) Yes, because they have been constructively evicted from part of the premises.
(D) Yes, because the landlord failed to maintain the kitchen in good repair.
(A) No, because they are entitled only to a rent abatement.
Explanation
The correct answer is: No, because they are entitled only to a rent abatement.
Discussion of correct answer: Where the landlord fails to maintain the common areas used by all tenants such that the tenant breaches the covenant of quiet enjoyment, this will be considered a constructive eviction. When the tenants are only constructively evicted from part of the premises, there has been a partial constructive eviction. Under the majority rule, if a tenant is constructively evicted from part of the premises, the tenant may receive a rent abatement, but is not relieved of all liability for rent. Therefore, the tenants are not entitled to withhold their entire rent payment, but may receive an abatement.
Discussion of incorrect answers:
Incorrect. No, because they did not move out of the townhouse. For constructive eviction to exist: (1) the landlord’s act must substantially and permanently interfere with the tenant’s use and enjoyment of the premises; and (2) the tenant must move out. When there constructive eviction is only partial, though, the tenant need only abandon the part of the premises that he has been constructively evicted from; he does not have to move out of the property entirely.
Incorrect. Yes, because they have been constructively evicted from part of the premises. Under the majority rule, when a tenant is constrictively evicted from only a part of the property, he is entitled only to a rent abatement, but not relieved of all liability to pay rent.
Incorrect. Yes, because the landlord failed to maintain the kitchen in good repair. While this is relevant in a claim that the landlord breached the covenant of quiet enjoyment, and thus partially constructively evicted the tenants from the kitchen common area, it is not a reason for the tenants to be relieved from all liability for rent. They would be entitled only to a rent abatement, and possibly damages for breach of the covenant of quiet enjoyment.
An owner has a home valued at $100,000 and owes Bank No. 1 $50,000 for a first mortgage lien. The owner owes Bank No. 2 $40,000 for a second mortgage. The owner applies to Bank No. 1 for additional funds to purchase a motor home, and the bank provides the funds. Bank No. 1’s mortgage is increased to $100,000 after it increases the homeowner’s mortgage.
Should Bank No. 2 feel undersecured as the result of Bank No. 1’s increasing the amount added to the homeowner’s mortgage?
Yes, because Bank No. 2 should have been required to authorize the additional loan.
Yes, because the homeowner increased his loan obligation by $50,000.
No, because the homeowner increased the principal amount owed to Bank No. 1.
No, because the homeowner will have larger installment payments as the result of the additional monies loaned.
The correct answer is: No, because the homeowner increased the principal amount owed to Bank No. 1.
Discussion of correct answer: The senior mortgage was modified when the homeowner increased the amount owed. Where there is a modification, a junior mortgage holder prevails over the modification if the modification materially prejudices the holder of the junior mortgage. Increasing the amount of the principal is an example of a modification materially prejudicing the holder of a junior mortgage. Since the homeowner increased the amount owed, the modification materially affected Bank No. 2. However, since Bank No. 2 would prevail over the modification, Bank No. 2 should not feel undersecured.
A husband and wife were walking down a country road when they were frightened by a steer running loose on the road. To avoid the steer, they climbed over a fence to get onto the adjacent property, which was owned by a farmer. After climbing over the fence, the husband and wife damaged some of the farmer’s crops that were growing near the fence, on which was posted a large “No Trespassing” sign. The farmer was walking with his large watchdog when he saw the husband and wife. The farmer approached them, hoping to frighten them with the fierce-looking dog, but the leash broke and the dog bit the wife.
If the wife files a battery claim against the farmer, will she prevail?
(A) No, because the wife made an unauthorized entry onto the farmer’s land.
(B) No, because the farmer did not intend to cause any harmful contact with the wife.
(C) Yes, because the farmer intended for the dog to frighten the wife.
(D) Yes, because the breaking of the leash establishes liability under the doctrine of res ipsa loquitur.
(C) Yes, because the farmer intended for the dog to frighten the wife.
A landlord leased an office space to a tenant for five years. The lease contained covenants whereby the tenant agreed to pay $750 rent per month to the landlord, and the landlord agreed to repaint the office once each year. At the beginning of the second year, the landlord refused to paint the office.
What are the tenant’s remedies?
(A) The tenant may refuse to pay rent due to the landlord’s breach of covenant.
(B) The tenant may treat the lease as terminated if he vacates the premises.
(C) The tenant may paint the office space himself and offset his subsequent rental payments by the cost of the paint and labor.
(D) The tenant may not paint the office space, because this would constitute ameliorative waste.
(C) The tenant may paint the office space himself and offset his subsequent rental payments by the cost of the paint and labor.
A shop owner told his customer that he owned a sizable tract of land. The two then entered into a written land sale contract, under which the customer would pay $75,000 and the shop owner would deliver to the customer a general warranty deed. However, unknown to the customer, the shop owner was in fact only leasing the land from a friend. The following week, the customer entered into a deal with a real estate broker. According to the terms of that contract, on October 1, the broker would pay $100,000 and the customer would deliver a general warranty deed. On September 1, the customer tendered $75,000 to the shop owner in exchange for a purported general warranty deed to the land. Then, on October 1, the broker paid the customer $100,000 in exchange for a purported general warranty deed. Two weeks later, the customer discovered that the shop owner’s friend, not the shop owner, was and remained the owner of the land. The customer then negotiated with the shop owner’s friend, and October 30, the friend gave the customer a general warranty deed in exchange for $85,000. When the broker then discovered that the customer had not held title to the land on October 1, he brought an action to recover damages from the customer. Should the broker recover?
(A) Yes, because the customer conveyed the property by general warranty deed.
(B) Yes, because the customer breached the warranty of marketable title implied in her land sale contract with the broker.
(C) No, because under the doctrine of estoppel by deed, the broker received title to the land on October 30.
(D) No, because the customer is protected from liability by the doctrine of equitable conversion.
(A) Yes, because the customer conveyed the property by general warranty deed.
A university director and a buyer entered into a written contract for the sale of a building owned by the university, constructed of marble, and situated on a half-acre lot. After the contract had been signed but before the date set for closing, a powerful tornado struck the area and totally destroyed the building. The university has no insurance to compensate for the loss of the building. The contract made no provision for the destruction of the building, and the jurisdiction has no applicable statute governing the rights of the parties. When the buyer refused to deposit the purchase price into escrow, the university director brought an appropriate action to enforce the contract via specific performance.
Which of the following best supports a judgment in favor of the university?
The doctrine of equitable conversion means that the buyer is regarded in equity as the owner of the building.
Since the buyer could have avoided loss by insuring his interest in the building, he cannot complain about having to perform under the contract.
Specific performance is available to either party in a land sale contract since each parcel of land is considered unique, the loss of which is not compensable in damages.
Since the university’s action sounds in equity, the buyer is precluded from raising the circumstances of the building’s destruction as a defense.
The correct answer is: The doctrine of equitable conversion means that the buyer is regarded in equity as the owner of the building.
Discussion of correct answer: The doctrine of equitable conversion allocates the risk of loss in a land sale contract to the purchaser. Thus, if damage or destruction occurs to the real property after formation but before closing, the purchaser (whom equity considers the owner of the property) bears the loss. In circumstances such as those presented by this question, the buyer is considered the equitable owner of the building from the moment the contract of sale is formed, and the subsequent destruction of the building by the earthquake is the buyer’s loss. The buyer must pay the full purchase price to the university even though the value of the property has been substantially reduced by the loss of the marble structure. A number of jurisdictions have altered the doctrine of equitable conversion so that the risk of loss remains on the seller until closing unless the purchaser takes possession. The Uniform Vendor and Purchaser Risk Act generally places the risk of loss upon the seller until the buyer has either taken possession or obtained legal title, at least as to physical damage to the property. The facts here indicate that this jurisdiction had not adopted any statute on the subject.
One day, a renter called the telephone company to report that the telephone line outside his house was down. Two telephone repairmen, a technician and a supervisor, responded to the call. The technician went up in the bucket truck while the supervisor remained on the ground below. In the meantime, the renter was across the street in his living room smoking marijuana, indulging in his “afternoon high.” As the technician was working on the line, the supervisor negligently bumped the bucket truck into reverse and hit the accelerator. The technician, in a panic, grabbed onto the top of the telephone pole and was left dangling. As the supervisor scrambled to get the bucket truck back underneath the technician, the renter saw everything from his window. He grabbed his chainsaw from the basement, ran across the street, and cut down the telephone pole. The technician fell to the ground and broke both arms and his collarbone. The technician sued the renter.
Which of the following is correct?
A. The renter should be held liable for negligence, unless he could have saved the technician had he not been high.
B. The renter should not be held liable for negligence, because he had no duty to take affirmative action to save the technician.
C. The renter should be held liable for negligence, because he caused the technician to fall.
D. The renter should not be held liable for negligence, because the supervisor placed the technician in peril and the renter was just trying to help.
C. The renter should be held liable for negligence, because he caused the technician to fall.
A teacher purchases a two-story home in the city and obtains a loan from the bank for $300,000. The bank files a deed of trust on the property and obtains a lien on the property. A few years later, the teacher loses her job and has trouble making payments to the bank. After three months without receiving a payment, the bank initiates foreclosure proceedings. One month later, a date is set for a public auction on the property. A few days prior to the public auction, the teacher’s uncle provides a loan to the teacher, which is more than sufficient for the teacher to pay her mortgage and stop the auction. However, the bank refuses to stop the auction and tells the teacher that she is unable to pay the debt due.
Is the bank correct that the teacher cannot stop the foreclosure proceedings?
Yes, because once the foreclosure proceedings started, the teacher lost her ability to redeem the property.
Yes, because the bank obtained a court order to conduct a public auction on the property.
No, because the teacher has the right to redeem the property before foreclosure of the property.
No, because the teacher has the right to redeem the property up to two years following foreclosure of the property.
The correct answer is: No, because the teacher has the right to redeem the property before foreclosure of the property.
Discussion of correct answer: A mortgagor has the right at any time after default, but before foreclosure, to redeem the property by paying the debt due. Here, a few days prior to the public auction, the teacher found the funds to pay the amount due. The bank should have worked with the teacher to assist her with her redemption of the property.
A lifeguard owned a beautiful sea side cottage. The lifeguard entered into a five-year residential lease agreement for the cottage with a trucker. The lease prohibited all assignments. After occupying the premises for four years, the trucker requested permission to assign the lease to a taxi driver. The lifeguard agreed to a one-time waiver of the provision in the lease which prohibited assignments, and the trucker assigned the lease to the taxi driver. One month later, the taxi driver assigned the lease to a tax attorney without requesting or receiving permission from the lifeguard. The tax attorney failed to pay rent.
Who should the lifeguard sue for the unpaid rent?
A. The tax attorney, because under the Rule in Dumpor’s Case, the assignment of the lease to the tax attorney was valid.
B. The trucker and the tax attorney.
C. The trucker and the taxi driver, because the assignment to the tax attorney was not valid.
D. The trucker, because the authorized assignee vacated the premises.
C. The trucker and the taxi driver, because the assignment to the tax attorney was not valid.
Discussion of correct answer: Under the Rule in Dumpor’s Case, once the landlord waives the prohibition on assignments, it is waived forever. However, the majority rule is that a landlord can preserve the validity of the anti-assignment clause by stating that the waiver is one-time only. Because the lifeguard did so here, the clause remained valid after the one-time waiver to the taxi driver. As such, the assignment to the tax attorney was invalid, and he never entered privity of estate with the lifeguard. Therefore, the lifeguard could sue either the trucker, who remains in privity of contract, or the taxi driver, who remains in privity of estate.
When Mamie died in 2040, she was survived by her two daughters, Sue and Ellie. Sue was a widow with one son, Aaron. Ellie was a childless widow. By her will, Mamie devised Homestead “to Sue and Ellie, as joint tenants with right of survivorship.” Sue died in 2055, leaving a will in which she devised her interest in Homestead to her son Aaron “for life, and then to his heirs and assigns.” At the time of Sue’s death, Aaron had no children. In 2060, Ellie died, leaving a will in which she devised all her real property to her good friend Burt, who had taken care of her in her final illness. In 2061, Burt conveyed Homestead to Ronnie by warranty deed. Ronnie then contracted to convey Homestead to Fern.
Which of the following statements is most accurate?
Title to Homestead is unmarketable, because the conveyance by warranty deed to Ronnie made title unmarketable.
Title to Homestead is unmarketable, because Aaron may have children sometime in the future who can contest the conveyance.
Title to Homestead is marketable, because Aaron and any children he has had could participate in the conveyance to Fern.
Title to Homestead is marketable.
The correct answer is: Title to Homestead is marketable.
Discussion of correct answer: When Mamie devised Homestead to Sue and Ellie, they became joint tenants with right of survivorship. When Sue died in 2055, Ellie became the sole owner of Homestead. Ellie then conveyed marketable title to Burt by will. Burt subsequently conveyed marketable title by warranty deed to Ronnie. As such, Ronnie is the sole owner of Homestead and can convey marketable title to Fern.
A stockbroker leased his apartment to a diplomat pursuant to a lease with a one-year term. Shortly after moving into the apartment, the diplomat installed central air conditioning in the apartment. The lease did not address renovations or improvements such as the diplomat’s installation of air conditioning.
In most jurisdictions, is the diplomat’s action permissible under the lease?
(A) Yes, because the diplomat improved the value of the premises.
(B) Yes, because the lease does not prohibit it.
(C) No, because it constitutes permissive waste.
(D) No, because it constitutes ameliorative waste.
(D) No, because it constitutes ameliorative waste.
A homeowner has a mortgage with ABC Bank. The homeowner loses his job and has no income or ability to make the required monthly payments under the mortgage. The homeowner’s friend is looking for a home to purchase. Without notice to the bank, the homeowner sells the property to the friend, who agrees to make the payments. Three months later, the friend loses his job and is unable to satisfy the monthly mortgage payments.
Is the friend liable to the bank?
A. Yes, because the friend agreed to the terms of sale and, as transferee, the friend owns and possesses the property.
B. Yes, because the friend is in breach of the terms of the mortgage.
C. No, because the bank may not foreclose if the property has been sold to the friend, a third party.
D. No, if the friend agreed to purchase the property subject to the mortgage.
D. No, if the friend agreed to purchase the property subject to the mortgage.
A tenant rented a furnished, two-bedroom apartment from a landlord under a short-term lease. One evening, the tenant came home to find that the wall between the two bedrooms had collapsed, making the apartment structurally unsound. The tenant immediately informed the landlord of the problem. Fearing injury or further damage to his personal property, the tenant moved in with his sister. Two weeks went by and the next month’s rent became due, but the landlord had made no attempt to fix the damage.
Is the tenant required to stay in the lease?
A No, because the landlord constructively evicted the tenant.
B No, because the landlord actually evicted the tenant.
C Yes, and the tenant must repair the damage.
D Yes, and the tenant must allow more time to repair the damage.
A No, because the landlord constructively evicted the tenant.
A train conductor had some beautiful land in the desert. He gave his widowed friend permission to camp there for four months. The friend fell in love with the area and built a small house on the land without telling the conductor and raised his son there. After 25 years there, the friend died and left the land to his son. The conductor died the following year. Seven years later, the friend’s son bought some nearby land, combined it with his own, and built a profitable resort. The hotel, the centerpiece of the resort, was located on the land that had originally belonged to the conductor. When the conductor’s heirs learned about the hotel and resort, they sued to have the hotel declared theirs. The period of time required to acquire title by adverse possession in their jurisdiction is 30 years.
How should the court rule?
(A) The land and the hotel belong to the friend’s son.
(B) The hotel belongs to the friend’s son, but the land belongs to the conductor’s heirs.
(C) The land and the hotel belong to the conductor’s heirs.
(D) The hotel belongs to conductor’s heirs, but the land belongs to the friend’s son.
(A) The land and the hotel belong to the friend’s son.
A lawyer handed his son a deed granting the lawyer’s land “to my only granddaughter.” The lawyer instructed his son not to give the deed to the granddaughter unless and until she survived her parents. In his conversation with his son, the lawyer expressly retained the right to retrieve the deed. The son placed the deed in a desk drawer. Alas, the granddaughter discovered the deed and promptly recorded it in accordance with the state’s recording act. Three months later, the lawyer was involved in an automobile accident with another driver. The driver sued the lawyer and was awarded a $100,000 judgment. Having no actual notice of the conveyance to the granddaughter, the driver recorded a judgment lien against the lawyer’s land and sought enforcement of the lien. The state recording act reads, “Every unrecorded conveyance of real property is void against any subsequent purchaser for consideration or mortgagee of the same property whose conveyance is first duly recorded, and as against any subsequent judgment on record affecting the title.” If the court finds in favor of the driver and enforces the judgment lien against the land, it will most likely be for which of the following reasons?
(A) The recording act expressly protects subsequent judgment creditors such as the driver.
(B) As a donee, the granddaughter is not protected by the recording act, which expressly protects only purchasers for consideration, mortgagees, and judgment creditors.
(C) The conveyance by the lawyer to his granddaughter was not effective.
(D) The driver had no actual notice of the granddaughter’s interest in the property.
(C) The conveyance by the lawyer to his granddaughter was not effective.
A landlord and a business executive entered into a written lease agreement for a penthouse apartment for a period of five years, with rent to be paid monthly. Two years later, the executive was reassigned to an office in another state for one year. The executive leased the apartment to a coworker for the duration of his reassignment. The coworker promptly moved in, but never paid any rent. After nine months, the coworker was fired, and he moved out of the apartment and back in with his parents. Upon returning home from his reassignment, the executive had barely unpacked before he was promptly served with a lawsuit filed by the landlord against both the executive and the coworker for the previous year’s unpaid rent.
Assuming the landlord is successful, how will the court rule regarding damages?
A Against the coworker individually for the full year’s rent, and no judgment against the executive.
B Against the executive for the full year’s rent, and no judgment against the coworker.
C Against the executive individually for three months’ rent, and against the coworker individually for nine months’ rent.
D Against the executive and coworker for the full year’s rent, because they are jointly and severally liable
The correct answer is: B. Against the executive for the full year’s rent, and no judgment against the coworker.
Discussion of correct answer: A sublease occurs when a tenant transfers to a third person (the subtenant, or sublessee) less than all of his rights, title, and interest in the leased premises. A subtenant does not come into privity of estate with the original landlord. Therefore, absent an express assumption of the duty to pay rent by the subtenant, the landlord may not sue the subtenant directly for unpaid rent. Here, the coworker was a sublessee, because his lease was for only one of the three years remaining on the lease term. As such, the landlord has no cause of action against the coworker, and must instead recover all of the unpaid rent from the original tenant, the business executive.
Discussion of incorrect answers:
Incorrect. Against the coworker individually for the full year’s rent, and no judgment against the executive. Because the coworker was a sublessee, he was neither in privity of estate nor private of contract with the landlord. As such, the landlord has no cause of action against him. The landlord must instead recover any or all of the unpaid rent from the original tenant.
Incorrect. Against the executive individually for three months’ rent, and against the coworker individually for nine months’ rent. While the fact that the coworker abandoned the premises may affect his liability for unpaid rent to the business executive, the coworker will not be directly liable to the landlord at all, because he was a subtenant, and so never came into privity with the landlord. Instead, the business executive, as the original tenant, will remain liable for the entire unpaid rent.
Incorrect. Against the executive and coworker for the full year’s rent, because they are jointly and severally liable. Because the coworker was a sublessee, he was neither in privity of estate nor private of contract with the landlord. As such, the landlord has no cause of action against him, either jointly or severally. The landlord must instead recover any or all of the unpaid rent from the original tenant alone.
A landowner owned a vacant lot. The landowner agreed to sell the vacant lot to a purchaser for $30,000. The purchaser intended to build and operate a Christmas tree shop thereon. The written agreement was complete in all respects and provided, among other things, that on the date set for closing, nine months into the future, the landowner would convey “good and marketable title” to the vacant lot by depositing into escrow a general warranty deed to that effect. Four weeks after the contract of sale was signed, the purchaser sought the landowner’s permission to enter into possession of the vacant lot. The landowner orally agreed. Unbeknownst to the landowner, the purchaser subsequently planted 50 pine trees on the vacant lot. The presence of the pine trees, which had cost the purchaser $10,000 to plant, increased the market value of the vacant lot by $8,000. One month before the date set for closing, the purchaser abandoned possession of the vacant lot and informed the landowner that he was rescinding the land sale contract because he was leaving the area in order to join an ongoing menorah-selling business in another city. When the landowner refused to pay the purchaser $10,000 in reimbursement for the cost of planting the pine trees, the purchaser brought an appropriate action to recover that amount from the landowner.
Judgment should be awarded for whom?
The landowner, because his assent to the purchaser’s possession was not in writing.
The landowner, because the purchaser repudiated the land sale contract.
The purchaser, in the amount of $8,000, because the landowner’s permission for the purchaser to take possession of the vacant lot under these circumstances constituted tacit permission to make improvements to the property.
The purchaser, in the amount of $10,000, because he is subrogated to the rights of the contractor who planted the pine trees.
The correct answer is: The landowner, because the purchaser repudiated the land sale contract.
Discussion of correct answer: In land sale contracts, where the performance is to pay money rather than render services, the court’s first reaction to a breaching purchaser was to allow the seller to retain any down payment, even if the amount so paid exceeded what the seller might have obtained in damages. There has been a movement to permit a defaulting buyer to obtain restitution of any payments made in advance to the extent that they exceed the actual damages suffered by the aggrieved seller. Even under circumstances where restitution was readily allowed, as in building construction contracts, restitution would be denied if the breach was willful, or for the convenience or financial advantage of the breaching party. In any case, the courts do not uniformly grant restitution to breaching buyers in land-sale contracts. In this question, the purchaser went into possession of the real property and without the knowledge of the landowner made improvements thereon. The purchaser then breached, for his own convenience (to pursue a business opportunity in another city), and now seeks to compel the landowner to pay for something the landowner never bargained for. Under these circumstances, the case for restitution to the purchaser is very weak.
The owner of a limousine business decided to retire and convey his building to his daughter. The owner hoped that his daughter would take over the business and settle down. The owner conveyed the building by quit claim deed for the sum of one dollar “to my daughter and her heirs for so long as the premises are used for a limousine business.” As soon as the owner retired and moved to California, his daughter converted the building to a dance club and abandoned the limousine business.
Did the estate automatically revert to the owner?
Yes, because the estate was defeasible.
Yes, because the estate was a fee simple determinable with the possibility of reverter.
No, because the estate was a fee simple determinable.
No, because the estate was a fee simple subject to condition subsequent.
The correct answer is: Yes, because the estate was a fee simple determinable with the possibility of reverter.
Discussion of correct answer: A determinable estate terminates automatically on the happening of a named future event. A determinable estate is described with the following words: “for so long as,” “during,” “while,” or “until.” The language “to my daughter and her heirs for so long as the premises are used for a limousine business” created a fee simple determinable with the possibility of reverter. The estate automatically reverted to the owner when his daughter ended the limousine business.
A young man and his friend were cliff jumping from a popular jump site. As the young man approached the edge of the cliff, he said that he saw a person at the bottom. The friend, a more experienced jumper who had introduced the young man to the sport, looked down and said to go jump and that the young man will land nowhere near the person at the bottom. The young man was uncertain, but jumped anyway and lost control of his parachute. A woman was swimming in a quarry near the landing site. The young man released his parachute as he spun over the quarry and landed on top of the woman. The woman lost consciousness and suffered a broken arm as the young man struggled to drag her ashore.
Who bears liability for the accident?
A. The young man only, because his conduct was the legal cause of the accident.
B. Neither the young man nor the friend, because the woman was contributorily negligent by swimming in the quarry.
C. Both the young man and his friend, because they were joint tortfeasors.
D. The friend only, because his encouragement initiated the accident.
C. Both the young man and his friend, because they were joint tortfeasors.
A locksmith and a tennis pro entered into a written lease agreement for the lease of an apartment owned by the locksmith. Under the terms of the lease agreement, the tennis pro was to rent the apartment for $2,000 per month from the locksmith for a period of two years. On the day the lease commenced, the tennis pro found he could not gain access to the apartment because the locksmith had changed the locks and had allowed his girlfriend to move into the apartment.
Has the locksmith breached his duty?
A. No, under the minority rule, because the tennis pro has a legal right to possess the premises.
B. No, under the majority rule, because a lease for a term of years may be terminated at will.
C. Yes, under the minority rule, because the landlord has constructively evicted the tennis pro.
D. Yes, under the American rule, because the locksmith has not delivered actual possession of the premises to the tennis pro.
A. No, under the minority rule, because the tennis pro has a legal right to possess the premises.
A musician landed a lucrative recording contract. Soon thereafter, the musician entered into a contract with a husband and wife to purchase their residence for $1,000,000. The purchase contract required the musician to make a deposit of $10,000 as a down payment but did not contain a liquidated damages provision. Shortly thereafter, the musician’s recording contract was terminated when he was arrested for drug use. The musician notified the husband and wife that he would be unable to proceed with the purchase of their home. He requested his $10,000 deposit back to pay bail, but the husband and wife refused. On the day that the musician was to close on the husband and wife’s home, another buyer purchased the home for $1,100,000.
If the musician brings an action against the husband and wife to recover his $10,000 and wins, it will be because of what reason?
The termination of the musician’s recording contract was wrongful.
The deposit amount was excessive.
Absent a liquidated damages provision, a down payment is always refundable.
The husband and wife were able to sell their property to another buyer for $1,100,000 soon after the musician refused to perform.
The correct answer is: The husband and wife were able to sell their property to another buyer for $1,100,000 soon after the musician refused to perform.
Discussion of correct answer: Even without a liquidated damages provision, a seller may elect to retain a down payment in the event of a breach by the buyer but the modern approach limits the amount to no more than 10% of the purchase price and courts may require the seller to return to the buyer the amount that the down payment exceeds the actual damages caused by the breach. In this case, the husband and wife did not suffer any damages as a result of the breach because they were able to sell the house in the same time frame as originally anticipated and for more than the original contract price. A court would likely require the couple to return the $10,000 to the musician for this reason.
A rancher owned a ranch. In order to protect his livestock from wolves, the rancher erected a fence with electrical wiring around his property. The wiring emitted a shock upon contact with the fence, but the voltage was of such low intensity that it posed no risk of injury to a human being. Consequently, the rancher did not post any notice of the electrical wiring. One day, a cowboy was riding his horse along the rancher’s property when a gust of wind blew his hat onto the fence. The cowboy had a pacemaker. When the cowboy touched the fence to retrieve his hat, the electric current short-circuited his pacemaker, killing him. The cowboy’s estate brought a wrongful death action against the rancher.
Which of the following would the electrical wiring device constitute?
A. The legal cause of the cowboy’s death, but not the cause-in-fact.
B. The cause-in-fact of the cowboy’s death, but not the legal cause.
C. The legal cause and the cause-in-fact of the cowboy’s death.
D. Neither the legal cause nor the cause in-fact of the cowboy’s death.
B. The cause-in-fact of the cowboy’s death, but not the legal cause.
A professor rented a single family home in a small college town. The valid written lease ran from August to August with rental payments of $1,500 due on the first of each month. In December the professor traveled home for the holidays. When he returned he found that the first floor of the house had flooded during a recent storm and the living room carpeting had been damaged. He informed the landlord, but when nothing had been done by the end of January the professor decided to withhold February’s rent. Although the carpeting had dried, it had discolored and buckled in several places.
March came with no word from the landlord, and the professor packed his things and moved out of the house. There is no applicable statute in the jurisdiction.
If the landlord sues the professor for breach of the lease, which of the following is accurate?
A The landlord will win, because he was not given sufficient time to repair the carpeting.
B The landlord will win, because the professor was not constructively evicted.
C The professor will win, because his obligation to pay rent ceased when the landlord failed to repair the carpeting.
D The professor will win, because the landlord breached the implied warranty of habitability.
B The landlord will win, because the professor was not constructively evicted.
A father’s daughter had recently applied for admission to a prestigious college. The father knew that if the daughter were accepted by the college he would be unable to pay her tuition from his savings. The father approached his wealthy uncle, explained the situation to him, and asked if the uncle would be willing to lend him money to cover the daughter’s tuition. The uncle responded that he would be willing to lend up to $10,000 per year, but would require security that the debt be paid. In exchange for the uncle’s promise to lend the tuition money, the father executed a mortgage in favor of the uncle on Whiteacre, a parcel of land owned by the father. The uncle promptly recorded this mortgage.
A month later the daughter received a letter stating that she was not accepted for admission by the college. The daughter then enrolled at a local community college. Since the tuition at the community college was far less than at the prestigious college the father did not need to borrow money from the uncle.
One year later, the father died in an auto accident. The daughter, as the father’s sole heir, inherited all of the father’s estate. She discovered that, six months prior to executing the mortgage in favor of the uncle, the father had issued a mortgage on Whiteacre to a bank in exchange for a loan. Neither the daughter nor the uncle knew of this mortgage, and the bank failed to record it. The jurisdiction has the following recording statute in effect:
“An unrecorded conveyance, mortgage or other instrument is invalid as against a subsequent bona fide purchaser for value and without notice.”
Which mortgage would have top priority?
A The uncle’s mortgage, because at the time of recordation, the uncle had no knowledge of the mortgage to the bank.
B The uncle’s mortgage, because his promise to pay tuition would be sufficient to constitute “paying value.”
C The bank’s mortgage, because recording acts do not operate in favor of mortgagees.
D The bank’s mortgage, because the uncle was not a bona fide purchaser.
D The bank’s mortgage, because the uncle was not a bona fide purchaser.
A property owner borrowed money from a friend in order to make improvements. As security, the owner granted his friend a mortgage “on all the real property I own in [the county]” and promised that the mortgage would be repaid in no more than fifteen years. The friend recorded the mortgage. A few months later, the owner sold some of his property to a buyer. The owner then defaulted on the mortgage, and the friend attempted to foreclose on the buyer’s property. The buyer objected to the foreclosure, arguing that the friend did not have a mortgage on his property.
Does the friend have a mortgage on the buyer’s property?
(A) No, because the buyer was obligated to satisfy the mortgage when the property was sold.
(B) No, because the description of the property was not sufficient.
(C) Yes, because a mortgage deed was executed.
(D) Yes, because there was evidence of an intent to create a security interest.
(B) No, because the description of the property was not sufficient.
A landlord and a tenant entered into a lease for a period of one year for an apartment. Three months into the lease, the floor collapsed under the living room and part of the bedroom due to work that the landlord was doing in the apartment below. When the landlord told the tenant that it would take at least three months to repair the floors, the tenant moved out. When the tenant refused to pay rent the next month, the landlord sued the tenant.
Is the tenant obligated to continue paying rent?
(A) No, because the covenant of quiet enjoyment has been breached.
(B) No, because the tenant has been actually evicted from the property.
(C) Yes, because although the covenant of quiet enjoyment has been breached, the tenant is only entitled to a rent abatement.
(D) Yes, because the landlord is working to repair the apartment.
(A) No, because the covenant of quiet enjoyment has been breached.
The correct answer is:No, because the covenant of quiet enjoyment has been breached.
Discussion of correct answer:Every lease contains a covenant of quiet enjoyment (express or implied). A landlord is deemed to have breached this covenant if the landlord actually or constructively evicts a tenant. A constructive eviction occurs when: (1) the landlord’s act substantially and permanently interferes with the tenant’s use and enjoyment of the premises; and (2) the tenant moves out. In this case, both of these factors are present. When a tenant has been constructively evicted, he may treat the lease as terminated and withhold rent.
Discussion of incorrect answers:
Incorrect. No, because the tenant has been actually evicted from the property. The tenant here has been constructively, not actually, evicted from the property. An actual eviction occurs when the landlord, or someone claiming through him, disturbs the landlord in his possession of the property. In this situation, the tenant may treat the lease as terminated and withhold rent. However, when the doesn’t actually evict the tenant, but instead, substantially and permanently interferes with the tenant’s use and enjoyment of the property such that the tenant moves out, the landlord is considered to have constructively evicted the tenant.
Incorrect. Yes, because although the covenant of quiet enjoyment has been breached, the tenant is only entitled to a rent abatement. When the tenant has been constructively evicted from only part of the property, there is still a breach of the covenant of quiet enjoyment, but the tenant will be entitled to receive only a rent abatement, and not to withhold rent entirely. However, when the interference is substantial and the tenant actually moves out, the tenant will be considered to have been constructively evicted from the entire premises. When this occurs, the tenant is entitled to treat the lease as terminated and withhold rent.
Incorrect. Yes, because the landlord is working to repair the apartment. The fact that the landlord is working on repairing the restaurant is not relevant here. The landlord has constructively evicted the tenant from the property, and the tenant has actually moved out. As such, the tenant is entitled to treat the lease as terminated and withhold rent.
A bicycle helmet was designed to be lightweight. The helmet maker knew that its design would provide protection only for low-impact crashes, so it warned users not to use the helmet when using “any motorized vehicle.” A cyclist owned one of the helmets and decided to wear it hang gliding because a hang glider is not motorized. When the cyclist was running down the hill to take off, another glider negligently crashed into the cyclist. The cyclist hit his head, but the helmet did not protect him. He sustained permanent injuries as a result of his fall.
Will the helmet maker be held strictly liable for these injuries?
(A) No, because the cyclist misused the helmet.
(B) No, because the other glider’s negligence was a superseding cause of the cyclist’s injuries.
(C) Yes, because the helmet had a design defect.
(D) Yes, because the helmet had a manufacturing defect.
(C) Yes, because the helmet had a design defect.
A landlord and a tenant entered into an oral lease for a term of six months. After the commencement of the lease term, the ceiling of the leased apartment caved in as a result of renovations the landlord was making to the apartment above. Unable to remain in the apartment, the tenant moved out.
What are the tenant’s remedies at common law?
(A) Treat the lease as terminated and withhold rent, because the covenant of quiet enjoyment has been breached.
(B) Reduce the rent payments, because although the covenant of quiet enjoyment has been breached, the lease is not terminated.
(C) Unilaterally terminate the lease and discontinue rent payments.
(D) No remedies exist at common law, because an oral lease does not contain a covenant of quiet enjoyment.
(A) Treat the lease as terminated and withhold rent, because the covenant of quiet enjoyment has been breached.
A minister had been counseling a married couple. During one session, the husband accused the wife of having an extramarital affair, which the wife admitted. That Sunday, the minister gave a sermon against adultery. The minister did not mention any names or make any statements that would lead anyone to believe that the sermon was about a particular person. Nevertheless, the wife left the sermon extremely embarrassed, and she hid in her bedroom for several days.
In an action against the minister for intentional infliction of emotional distress, will the wife prevail?
(A) No, because preaching a sermon that talked about adultery was not outrageous conduct.
(B) No, because the wife did not sustain any physical harm as a result of her distress.
(C) Yes, because preaching a sermon that talked about adultery was outrageous conduct in these circumstances.
(D) Yes, because the minister was in a position of authority over the married couple.
(A) No, because preaching a sermon that talked about adultery was not outrageous conduct.
A developer owned a strip mall in a busy area of the city, and leased the storefronts to various businesses pursuant to year-to-year periodic lease agreements. Deciding to retire, the developer sold his interests to a business investor and assigned all of his lease agreements to the investor. None of the written lease agreements contained clauses addressing assignments.
Which of the following is true?
A The developer remains the landlord under the terms of the leases, because the assignments are invalid.
B The investor is now the landlord under the terms of the leases, because a landlord may assign his lease interest.
C The investor is the landlord under the terms of the leases, because the leases were commercial.
D The leases terminated upon the developer’s attempted assignment.
B The investor is now the landlord under the terms of the leases, because a landlord may assign his lease interest.
The correct answer is:The investor is now the landlord under the terms of the leases, because a landlord may assign his lease interest.
Discussion of correct answer:Only an at-will tenancy terminates when one of the parties attempts to assign his or her interest. By contrast, periodic leases, such as the year-to-year leases in this case, do not terminate upon a party’s assignment. As such, absent a lease term to the contrary, it was permissible for the developer, as landlord, to assign his lease interests to the business investor, who then became the new landlord under the lease agreements.
Discussion of incorrect answers:
Incorrect. The developer remains the landlord under the terms of the leases, because the assignments are invalid. There is nothing in the facts to suggest that the developer’s assignment of his lease interests to the business investor is invalid. The leases did not prohibit assignments, and the only type of lease that terminates upon a party’s attempted assignment is an at-will lease. Because the year-to-year leases in this question are periodic leases, not at-will leases, it was permissible for the developer to assign his lease interests.
Incorrect. The investor is the landlord under the terms of the leases, because the leases were commercial. The fact that the leases are commercial leases is not relevant to the question of whether the developer’s assignments were valid. The only type of lease that is subject to termination when it is assigned is an at-will lease (although any lease may contain a prohibition against assignments). Because the leases in this question are periodic leases that do not contain any prohibitions against assignments, the developer’s assignment of the leases to the business investor was valid.
Incorrect. The leases terminated upon the developer’s attempted assignment. The lease did not terminate upon the developer’s assignment. Unlike an at-will lease, which terminates if either party attempts to assign his lease interest, periodic leases such as the year-to-year leases in this question do not terminate upon the landlord’s assignment of his lease interest. As such, this answer choice is incorrect.
A lawyer leased his house to a travel agent for a term of four years. Sixteen months after the lease commenced, the house was destroyed when a gas leak caused a massive explosion. No one was injured. The travel agent found another place to rent and refused to pay the lawyer. The lawyer filed suit to collect rent. The jurisdiction follows the old common law rule, not the modern common law rule.
Who should prevail?
A The travel agent, because the lease is a residential lease.
B The travel agent, because the lease terminated with the destruction of the house.
C The lawyer, because the house was not destroyed by an act of God.
D The lawyer, because the lease term has not expired.
D The lawyer, because the lease term has not expired.
Discussion of correct answer: Under the old common law estate theory, a tenant is still required to pay rent if the premises are destroyed during the lease term. In this case, given that the house was destroyed while the lease was still in effect, the travel agent will, under the old common law rule, be required to continue paying rent. Therefore, this is the correct answer choice.
When Mamie died in 2040, she was survived by her two daughters, Sue and Ellie. Sue was a widow with one son, Aaron. Ellie was a childless widow. By her will, Mamie devised Homestead “to Sue and Ellie, as joint tenants with right of survivorship.” Sue died in 2055, leaving a will in which she devised her interest in Homestead to her son Aaron “for life, and then to his heirs and assigns.” At the time of Sue’s death, Aaron had no children. In 2060, Ellie died, leaving a will in which she devised all her real property to her good friend Burt, who had taken care of her in her final illness. In 2061, Burt conveyed Homestead to Ronnie by warranty deed. Ronnie then contracted to convey Homestead to Fern.
Which of the following statements is most accurate?
(A) Title to Homestead is unmarketable, because the conveyance by warranty deed to Ronnie made title unmarketable.
(B) Title to Homestead is unmarketable, because Aaron may have children sometime in the future who can contest the conveyance.
(C) Title to Homestead is marketable, because Aaron and any children he has had could participate in the conveyance to Fern.
(C) Title to Homestead is marketable.
(C) Title to Homestead is marketable.
A talented florist took great pride in the gardens on his estate, his dress, and his political party membership. He had donated flowers to decorate the White House of every President of his chosen party for many decades. To ensure that his flowers would grace only the homes of those he felt worthy, his will left his real property to his nephew for as long as the nephew donated flowers to Presidents of his chosen party and to no others. The florist also devised all of his personal property to his nephew, except for an account containing $100. The florist’s only other heir was his nonmarital daughter, to whom he left the residue of his estate. Several decades later, the nephew became a generous supporter of a different political party. When that party’s candidate was elected, the nephew was given the honor of supplying the flowers for that party’s President’s inauguration. Upon hearing of the plans, the nonmarital daughter filed suit to quiet title.
If the court finds in the nonmarital daughter’s favor, what is the most likely reason?
(A) The nonmarital daughter held a valid possibility of reverter.
(B) The gift to the nephew violated the Rule Against Perpetuities.
(C) The nonmarital daughter inherited a valid reversionary interest.
(D) The gift to the nephew failed, because the conditions of the gift were void as against public policy.
(A) The nonmarital daughter held a valid possibility of reverter.
A gardener’s neighbor had won the local rose competition every year for the last 11 years. A week before the annual competition, the gardener watched as his neighbor watered his prize-winning roses. The gardener noted how small his own roses were in comparison to the neighbor’s roses. Extremely upset at the prospect of losing the contest to the neighbor yet again, the gardener ran into the neighbor’s yard and started stomping his roses. The neighbor yelled, “Stop, stop! My babies!” However, the gardener continued to damage the neighbor’s rose garden. The neighbor picked up his gardening shovel and swung it at the gardener to stop him from destroying all of the roses. The gardener was hit by the shovel and fell to the ground in pain. Beside himself with anger, the neighbor began hitting the gardener over the head with the shovel, eventually rendering him unconscious. The gardener’s wife saw the gardener being beaten with the shovel and ran outside screaming for the neighbor to stop, but the neighbor would not. The gardener’s wife picked up a pair of weeding shears and stabbed the neighbor in the face with them, injuring the neighbor severely. The neighbor filed suit against the gardener and his wife for trespass to land, battery, and intentional infliction of emotional distress.
For which claims will the neighbor likely prevail at trial?
(A) Trespass to land, battery, and intentional infliction of emotional distress.
(B) Trespass to land and battery, but not for intentional infliction of emotional distress.
(C) Trespass to land only.
(D) Trespass to land and intentional infliction of emotional distress only, but not for a battery.
(D) Trespass to land and intentional infliction of emotional distress only, but not for a battery.
A seller contracted to sell a parcel of property to a buyer by general warranty deed. The contract is enforceable and contains all the elements necessary to satisfy the Statute of Frauds. At the closing, the seller tendered a general warranty deed, but the buyer refused the deed and would not complete the transaction because she had discovered an unpaid mortgage on the property.
The buyer asserts the mortgage renders the property not “free of encumbrances” as required by the contract. The amount of the mortgage is less than the agreed-upon purchase price for the parcel of property. The seller contends that he intends to pay off the mortgage from proceeds of the sale of the property to the buyer. The seller brings a cause of action against the buyer for specific performance.
If a court finds for the seller and compels specific performance, which of the following is the best explanation for the court’s ruling?
The seller hasn’t breached any portion of the contract.
The seller has the implied right to use the proceeds from the sale of the parcel of land to the buyer to satisfy the mortgage and clear title to the property.
Under the doctrine of equitable conversion, title has already passed to the buyer, and she is therefore obligated to pay the agreed-upon purchase price.
The lien of the mortgage will automatically shift away from the parcel of land and attach to the seller’s proceeds from the sale.
The correct answer is: The seller has the implied right to use the proceeds from the sale of the parcel of land to the buyer to satisfy the mortgage and clear title to the property.
Discussion of correct answer: The existence of unpaid liens or mortgages will not constitute a breach of the purchase contract if the proceeds from the sale are sufficient and, in fact, used to pay off the encumbrance. The facts state that the proceeds from the sale of the parcel of land will be more than enough for the seller to pay off the mortgage and clear title to the property at closing.
A seller entered into a written contract with a buyer whereby the buyer was to purchase Brownacre, an undeveloped parcel consisting of 100 acres, for $250,000. The contract provided that, “because of economic uncertainties, time is of the essence.” The contract further provided for a closing date of June 30, specified that all warranties and covenants of title would merge into the deed after closing, and required the buyer to deliver half the purchase price to the seller by June 15 and the balance on the date of closing.
The buyer failed to make the payment of one-half of the purchase price on June 15. On June 20, the buyer tendered a check for $125,000 to the seller, which the seller accepted. On June 30, the buyer tendered the remaining $125,000 and the seller delivered a deed to Brownacre to the buyer. The seller then sued the buyer for damages caused by the delay in tendering the first payment of the purchase price.
What would be the result in that lawsuit?
The seller will prevail, because he tendered the deed to the buyer in a timely fashion.
The seller will prevail, because the acceptance of the late performance did not waive the right to recover damages.
The buyer will prevail, because the short delay did not result in a material breach of the land-sale contract.
The buyer will prevail, because the seller waived any right to damages by accepting the late performance.
The correct answer is: The seller will prevail, because the acceptance of the late performance did not waive the right to recover damages.
Discussion of correct answer: As a general rule, time is not of the essence in a real estate contract unless the parties state otherwise. Here, the contract specifically stated that time was of the essence. This means that the buyer’s late performance was a breach of the contract. The seller could have treated the late performance as a material breach of the contract, discharging his obligation to deliver the deed to the buyer. However, by accepting the late performance the seller is electing to treat the late performance as a minor breach, entitling the seller to delay damages.
Dave and Sally were brother and sister. Their father Eddie died leaving a valid will. In his will, Eddie devised, “my house to both my children Dave and Sally.” Since the house was their childhood home, both Dave and Sally held a sentimental attachment to the property. One week after the funeral, Dave moved into the house. About three months later, Sally decided to visit the house. She was shocked to find out that Dave had rented her old room to her ex-husband Harry. Sally hired an attorney who discovered that Dave had recently taken out a mortgage on the house. Further, Dave already missed a mortgage payment.
Which of the following is correct?
Dave and Sally took the property as joint tenants, hence the tenancy was severed by Dave’s actions.
Dave and Sally took the property as tenants in common, hence the tenancy was not severed by Dave’s actions.
Dave and Sally took the property as joint tenants, hence Dave did not have the right to rent any rooms.
Dave and Sally took the property as tenants in common, hence Dave did not have the right to mortgage the house.
The correct answer is: Dave and Sally took the property as tenants in common, hence the tenancy was not severed by Dave’s actions.
Discussion of correct answer: Tenancy in common is a form of concurrent ownership, where each co-tenant owns an undivided interest in the whole of the property with no right of survivorship. No special words are required to create a tenancy in common. Tenancy in common requires unity of possession only. Unity of possession means that each tenant in common has the right to possess the whole of the property. A tenant in common may transfer her interest through a conveyance, lease, mortgage, or other transfer of a present possessory or future property interest. Dave and Sally took as tenants in common because of the language of the deed “my house to both my children Dave and Sally.” Dave has the right to rent a room and to mortgage the house. A co-tenant may seek partition through judicial action; however, the co-tenancy was not severed by Dave’s actions (as opposed to a joint tenancy).
A linguist and a teacher entered into a five-year residential lease agreement for a house owned by the linguist. The lease prohibited subleases. One year into the lease term, the teacher asked the linguist for permission to sublease the house, despite the provision in the lease prohibiting subleases. The linguist agreed, and the teacher signed a two-year sublease with a sailor. After the termination of this sublease, the teacher asked the linguist for permission to enter into a one-year sublease with a scientist. Even though the scientist’s income and assets indicated that he would easily be able to make the monthly rental payments, the linguist refused to grant permission for the sublease to the scientist. The teacher and the scientist signed the second sublease. The linguist filed suit against the teacher.
Who should prevail?
A. The teacher, because a landlord may not unreasonably withhold approval of a sublease.
B. The teacher, because under the Rule in Dumpor’s Case, a prohibition on assignment of a lease is unenforceable.
C. The linguist, because her oral waiver of the provision prohibiting subleases was ineffective.
D. The linguist, because she withheld her consent to the second sublease.
D. The linguist, because she withheld her consent to the second sublease.
A woman executed a mortgage with a bank for the purchase of a home. For the first few years of her 15-year mortgage, she had no trouble making timely payments on the mortgage note. One year, however, she got behind on her mortgage payments and, for five months, made no payments at all. The woman received notice from the bank indicating that she had defaulted on the loan and advising her of its intent to engage in foreclosure proceedings. Realizing that the home was worth quite a bit more than it was when she purchased it, the woman tried to sell it herself rather than face foreclosure but was unsuccessful. The bank subsequently foreclosed on the home and the sale price was more than sufficient to cover the outstanding debt. The woman contacted the bank to inquire about any remaining proceeds from the sale, and the bank told her that it had retained the remaining proceeds from the foreclosure sale as rent for the months that she lived in the house after she defaulted on the mortgage.
If the woman is successful in recovering the remaining proceeds, which of the following provides the best reason?
(B) She lives in a jurisdiction that adheres to the title theory of mortgage interests.
(D) She lives in a jurisdiction that adheres to the equitable theory of mortgage interests.
(A) She lives in a jurisdiction that adheres to the intermediate theory of mortgage interests.
(C) She lives in a jurisdiction that adheres to the lien theory of mortgage interests.
(C) She lives in a jurisdiction that adheres to the lien theory of mortgage interests.
A skier purchased a parcel of land from a landowner when she was 30 years old. The skier intended to develop the parcel as a ski resort. The next year, however, the skier suffered a head injury and was declared legally incompetent before she could make any improvements to the land. Five years later, a snowboarder purchased the parcel next to the skier’s parcel. The snowboarder built a large ski resort. A few years later, when the injured skier was 40 years old, the snowboarder inadvertently expanded her resort onto the skier’s land. The skier never recovered from her head injury and died at age 61. The skier’s daughter inherited the skier’s estate. Five years after the skier’s estate passed to the skier’s daughter, the snowboarder was killed by a falling gondola. The snowboarder’s children, a brother and a sister, inherited the resort as joint tenants. That same year, the skier’s daughter sought to eject the brother and the sister from that part of their resort that was on the daughter’s land. The statutory period for adverse possession is 20 years.
Will the daughter prevail in her suit against the brother and the sister?
(A) Yes, because the statute period was tolled during the incompetency of the skier.
(B) Yes, because the brother and the sister have not been in possession for 20 years.
(C) No, because the brother and the sister possess color of title to the daughter’s entire parcel.
(D) No, because the brother and the sister’s period of possession will be tacked onto the snowboarder’s period of possession.
(A) Yes, because the statute period was tolled during the incompetency of the skier.
A landlord owned a three-story building on the outskirts of the city. Having decided to retire, the landlord determined to sell the building to the tenants, who had each occupied the building for more than 20 years, as a favor to them. A day-care operator operated a day-care service on the first two floors. The child-care facility was on the first floor and the day-care operator’s business operation was on the second. A photographer operated a photographic supply warehouse on the top floor. The top two floors were served by a stairway attached to the building on its exterior. The landlord deeded the first two floors to the day-care operator, and the third floor to the photographer via a simple, hand-drawn deed. No lawyers were involved, but the deed was sufficient to satisfy the statute of frauds applicable in the jurisdiction.
Several years after the conveyance, an earthquake caused the stairs running from the second to the third floor to collapse. When the photographer hired contractors to repair the stairs, the day-care operator objected, saying that he had no obligation to allow the workers on his premises to repair the stairs, and in fact, he feared that the asbestos that the workers would have to release in repairing the stairs would prevent him from operating his business. The statute of limitations on trespass actions in the jurisdiction is 15 years.
If the photographer brings suit to force the day-care operator to allow the photographer’s workers access to reconstruct the stairs, how is the court most likely to rule?
The photographer has a prescriptive easement to use (and thus to rebuild) the stairs by virtue of his long-standing use of the stairs for access to the third floor.
The photographer has an implied right to rebuild the stairs.
Any rights the photographer may have had were terminated by the destruction of the stairway.
The photographer has no right to rebuild the stairs unless the deed gives him that right.
The correct answer is: The photographer has an implied right to rebuild the stairs.
Discussion of correct answer: The building was held by a common grantor, who deeded part of it to one grantee and part of it to another grantee. An easement by necessity for the photographer to use the stairway can be implied, even if the deed does not specifically mention it, because that use of the stairway is necessary for the photographer to have access to his property, the top floor. This should be analyzed as analogous to the photographer’s purchase of a landlocked piece of land.
An elderly woman who needed to move into assisted housing agreed to sell her home to her neighbor for a below market price. Because the neighbor was notorious for taking poor care of his own property, a coalition of local residents came together in opposition to the deal. The coalition members offered the woman an extra $10,000 for the home, and the woman sold it to them on the spot. They paid her immediately, but they did not record the deed right away. With the elderly woman’s permission, they started planting flowers in the yard and they painted the outside of the house. When the time came for the elderly woman to move, the neighbor visited, told the woman he was disturbed by rumors he had heard that she had sold the property to the neighborhood coalition, and reminded her of their deal. Feeling guilty, the elderly woman lied and said that the deal with the coalition had fallen through, though the elderly woman wasn’t a very convincing liar. The neighbor knew that the coalition had planted flowers and painted the house. However, because he wanted the house, the neighbor gave the woman a cashier’s check in exchange for the deed, which the neighbor recorded immediately. The following day the coalition recorded its deed. Assume this transaction took place in a race-notice jurisdiction.
Who owns the property and why?
A The coalition, because it purchased first.
B The coalition, because it purchased first and the neighbor had notice of its deed.
C The neighbor, because he recorded first.
D The neighbor, because he is a bona fide purchaser.
B The coalition, because it purchased first and the neighbor had notice of its deed.
A debtor borrowed $50,000 from a bank and issued to bank a mortgage on property owned by the debtor. The mortgage instrument stated in part: “In the event the debtor defaults on the debt and the bank forecloses, the debtor agrees that her right to redeem shall last for a maximum of six weeks following a declaration of default by the bank.” A year later the debtor defaulted on the debt and the bank declared a default. A week later the bank initiated foreclosure proceedings. Six weeks later, before a foreclosure sale had taken place, the debtor tendered the full amount due on the debt. The bank refused to accept the tender and proceeded with the foreclosure.
Was the bank’s action proper?
Yes, because the debtor waived her right to redeem in the mortgage instrument.
Yes, because the bank had already initiated foreclosure proceedings.
No, because the debtor properly redeemed.
No, because the bank lost its right to foreclose on the property by attempting to “clog” the right of redemption.
The correct answer is: No, because the debtor properly redeemed.
Discussion of correct answer: A mortgagee is not allowed to “clog” the mortgagor’s equitable right of redemption. Any such statement in a mortgage document that attempts to do so will be unenforceable. The debtor’s equitable right of redemption exists until a foreclosure sale has taken place.
A tenant entered into a one-year lease with a landlord. The terms of the lease required the tenant to repair and maintain the premises during the lease, with the exception of ordinary wear and tear. After six months, the tenant complained to the landlord that the hot water was not hot. When the landlord failed to inspect the problem, the tenant again requested that the landlord repair the water heater. In the eighth month of the lease, the tenant stopped paying rent, but did not vacate the property. After the landlord repaired the water heater in the tenth month, the landlord demanded that the tenant pay the unpaid rent. When the tenant refused, the landlord evicted the tenant and sued to recover the unpaid rent.
Is the tenant liable to the landlord for the unpaid rent?
(A) No, because the landlord breached the covenant of quiet enjoyment by not repairing the water heater.
(B) No, because the landlord evicted the tenant before the end of the lease.
(C) Yes, because the landlord had no duty to repair the water heater without a specific provision in the lease.
(D) Yes, because the tenant had a duty to pay rent while in possession of the premises.
(D) Yes, because the tenant had a duty to pay rent while in possession of the premises.
After a gallery purchased one of her original paintings for an enormous sum of money, an artist decided to sell her studio, which was located in a rather dangerous part of town, and move to a nicer area. As a result of the studio’s less than desirable location, hardly anyone expressed any interest in purchasing the studio. Finally, a young newscaster saw an ad for the studio and came to view the property. The newscaster liked the studio very much, and thought that living in a “high-risk” area might give him access to breaking news stories. Sensing the artist’s eagerness to sell the studio, the newscaster offered to purchase the studio for $120,000, a price $50,000 below market value. The artist accepted the offer, and the newscaster gave the artist a check for $12,000 as a down payment on the studio, and the artist gave the newscaster the deed to the property. The parties agreed that the newscaster would deliver the remainder of the purchase price the following day.
However, the artist’s next-door neighbor overhead the communication between the artist and the newscaster. Less than an hour after the newscaster had left, the neighbor approached the artist with an offer to purchase the studio for the full market value of $170,000. Delighted at the opportunity, the artist immediately accepted the neighbor’s offer. That same night, the neighbor gave the artist a cashier’s check for the full amount of the purchase price, and the artist conveyed the deed to the neighbor. The neighbor did not immediately record the deed. The next day, the newscaster returned to the studio to give the artist a check for the remainder of the purchase price. Too embarrassed to admit that she had sold the studio to someone else, the artist accepted the newscaster’s check. Shortly thereafter, the newscaster recorded his deed to the studio. One week later, the neighbor recorded his deed. The jurisdiction in which the studio was located was a “pure notice” jurisdiction.
Under the jurisdiction’s “pure notice” recording statute, who owns the studio?
A. The newscaster, because he recorded his deed first.
B. The newscaster, because the neighbor had notice of the conveyance to the newscaster.
C. The neighbor, because he took subsequent in time to the newscaster.
D. The neighbor, because he was a bona fide purchaser.
B. The newscaster, because the neighbor had notice of the conveyance to the newscaster.
B. The newscaster, because the neighbor had notice of the conveyance to the newscaster.
Discussion of correct answer: Under a “pure notice” recording statute, an unrecorded conveyance or other instrument is invalid as against a subsequent bona fide purchase for value and without notice.
To prevail under a notice statute, a claimant of real property must prove the following three elements:
1) that the claimant took subsequent in time to another person claiming ownership of the real property in question;
2) that the claimant was a bona fide purchaser for value; and
3) that the claimant took the property without actual, constructive, or inquiry notice of a prior claim to the property.
In this case, the neighbor’s purchase of the studio did occur subsequent in time to the transaction between the artist and the newscaster, and the neighbor paid value for the studio. However, given that the neighbor overhead the transaction between the artist and newscaster and knew that the artist had delivered to the newscaster a deed to the studio, the neighbor had actual notice of the newscaster’s prior claim to the property, and will not be protected under the pure notice recording statute. Therefore, the newscaster is the legal owner of the studio.
A seller entered into a contract to sell Redwood to a buyer for $250,000. On the date agreed upon, the buyer paid the $250,000, and the seller executed a quitclaim deed to the buyer. Two weeks later, the buyer learned that the seller had acquired title to Redwood by adverse possession, and had never pursued an action to perfect title. The buyer brought an action against the seller for damages.
Who should prevail?
The buyer, because the seller failed to convey marketable title.
The buyer, because the seller breached the land-sale contract.
The seller, because he conveyed a quitclaim deed to the buyer.
The seller, because title obtained by adverse possession is marketable title.
The correct answer is: The seller, because he conveyed a quitclaim deed to the buyer.
Discussion of correct answer: Unless expressly stated to the contrary, every contract for the sale of real property contains an implied covenant requiring the seller to convey marketable title to the buyer. Marketable title generally means title that is free of all reasonable risk of attack. However, when the deal closes the contractual covenant to convey marketable title is said to “merge” into the deed, and it can no longer be the basis for legal action. Any action by the buyer against the seller after closing would have to be based on covenants of title contained in the deed. Here, the seller conveyed Redwood to the buyer by a quitclaim deed, which contains no covenants of title. Therefore, the buyer would not be able to recover against the seller based upon any failure by him to convey marketable title.
A father had one daughter. He gave her a signed paper that stated: “I hereby give my daughter my house for the rest of her life as long as she remains unmarried.” The daughter immediately moved into the house and began paying the appropriate property taxes. Later that year, a teenager lost control of his car and crashed into the garage. At that point, the father discovered that the daughter had not been insuring the house. The daughter did not repair the garage but instead put her old jalopy on the front lawn, on cinder blocks, waiting until she had time to repair it. She let weeds grow up around it, and also put several large hunks of rusty metal on the front lawn, which she was planning to make into a sculpture. A year later, the daughter’s boyfriend moved in and put his broken car up on blocks in the front yard, next to the daughter’s nonworking car. They got married the following year.
At what point could the father terminate the daughter’s estate?
A When the garage was damaged, because the damage to the garage impaired the value of the property.
B When the father learned that the daughter had not insured the house.
C When the daughter failed to repair the garage and left debris on the front lawn, because it impaired the value of the property.
D When the daughter married, because that is what the deed stated.
The correct answer is: When the daughter married, because that is what the deed stated.
Discussion of correct answer: The father created a determinable life estate for his daughter, to be measured by his daughter’s life, and conditioned upon her remaining unmarried. Her estate will automatically terminate and revert back to the father upon the daughter’s marriage or her death, whichever comes first. While the daughter did commit waste, the father would be limited to monetary damages unless a statute granted him the right to seek forfeiture through a judicial action. Because no such statute was mentioned in the facts, this answer is correct.
A truck driver worked a 40-hour week driving a semi-truck that transported crushed automobiles. During the month of November, he noticed a flyer advertising moonlighting positions available in the area on the bulletin board in the break room at work. The truck driver’s employer allowed such flyers to be posted as a courtesy to those employees who might need to earn extra money for the holidays. The driver called the number on the flyer and was hired by a farmer as an independent contractor. The truck driver was to collect Christmas trees from the farm and deliver them to several outlets that sold cut trees. After a few weeks of moonlighting, the truck driver was exhausted from driving 14 to 18 hours every day. While delivering trees, he missed a turn and slammed on his brakes. The sudden stop caused some of the trees to fall from the truck, and one of the trees knocked a pedestrian down and hit her in the head, severely injuring her.
If the pedestrian sues the truck driver’s employer and the farmer, from whom is the pedestrian entitled to recover?
A. Both the truck driver’s employer and the farmer.
B. The truck driver’s employer only.
C. The farmer only.
D. Neither the truck driver’s employer nor the farmer.
D. Neither the truck driver’s employer nor the farmer.
An electrician lived with his son and daughter in a house on several acres. When he died, he left his home to his son and daughter as tenants in common. Without any discussion or agreement about how to proceed with respect to ownership of the property, the daughter continued to live there, making all tax and insurance payments, paying for repairs and maintenance, and erecting valuable improvements such as a detached garage, guesthouse, and swimming pool. Upon his father’s death, the son went away to college and then worked in a nearby city as an accountant. The jurisdiction in which the property is located operates under common law, and there is no applicable legislation to the situation. Ten years after their father’s death, the son sought partition of the tenancy in common he shared with his sister via sale of the house and land. In addition to half of any proceeds from the sale, the daughter demanded from her brother an additional portion of the proceeds of sale to compensate her for the improvements she made and for the funds she expended in the upkeep and maintenance of the property.
How should the court rule?
The proceeds should be divided equally, since the daughter voluntarily contributed to the property in terms of maintenance and improvements and is, therefore, deemed to have made a gift to her co-tenant.
The proceeds should be divided equally, since a co-tenant out of possession has no duty to contribute to improvements or maintenance on the property.
The daughter should be given an additional amount of the proceeds attributable to the improvements she made, but only to the extent that the amount she paid exceeds the benefit she derived from use of the property.
The daughter should be given an additional amount of the proceeds attributable to the maintenance and upkeep of the property as well as the improvements she made if they generated increased profits.
The correct answer is: The daughter should be given an additional amount of the proceeds attributable to the maintenance and upkeep of the property as well as the improvements she made if they generated increased profits.
Discussion of correct answer: At common law, a co-tenant cannot seek contribution from another co-tenant for repairs performed on the property; however, in a partition suit, the costs of repairs may be credited in favor of the co-tenant who made repairs. Moreover, a co-tenant generally has no right to seek contribution or set-off for improvements made unless the improvements generate rents or profits, in which case the costs of improvements are recoverable via partition action. Finally, a co-tenant who pays a mortgage or taxes may seek contribution through partition; however, a co-tenant in sole possession will receive reimbursement only to the extent that his payment exceeds the market value of the property.
A man signed a mortgage to purchase a piece of property owned by a bank. The man agreed to make monthly payments for a period of 15 years according to the mortgage agreement. The man was in the process of obtaining the necessary permits to build a restaurant on the land, so he had not yet begun construction. Several months later, the bank conveyed the property to a developer who planned to put a hotel on the property. The developer paid cash to the bank for the property. One week later, the man recorded his interest subject to the mortgage. Two days after that, the hotel developer recorded his conveyance. Assume that this jurisdiction has a race-type recording act. Which party has priority?
(A) The developer, because he had an outright conveyance of the property.
(B) The developer, because the conveyance need not be recorded to be enforceable.
(C) The man, because he recorded his interest first.
(D) The man, because an interest subject to a mortgage does not need to be recorded in a race jurisdiction.
(C) The man, because he recorded his interest first.
A man invited several friends over to his house. While they were inside, freezing rain fell outside, coating everything with a thin layer of ice. As they left, one of the man’s guests slipped on the ice on the front stoop of the man’s house.
Which of the following best describes the duty of care owed by the man to his guest?
A. No duty of care.
B. A duty to inspect the premises for unknown dangers and disclose their existence to others.
C. A duty to warn of any known dangerous condition on the premises.
D. An absolute duty of care.
C. A duty to warn of any known dangerous condition on the premises.
A man owned a granite quarry that had a worldwide reputation for the quality of its stone. He had no offspring to take over when he died. Wanting to ensure the continuation of the quarry as a family business, he asked his nephew to take over. The nephew agreed. The man agreed to sell him the quarry for a nominal amount provided that the nephew agreed to language in the deed stating: “To my nephew and his heirs and assigns, but if my nephew dies without issue, then to his cousin and her heirs and assigns.” At the time that the man conveyed the quarry to his nephew, the nephew was single and had no children. Soon after the nephew took over the quarry, a spring was discovered that produced high-quality water. The nephew ordered the immediate cessation of all quarrying of granite in the area of the source of the spring. The portion of the quarry he closed down was the richest area of production. The nephew began to bottle water to sell in local and regional markets. By the time his cousin learned of the spring water operation on the property, granite production at the quarry had decreased by 30%.
If the cousin seeks to enjoin the nephew from continuing the water extraction and to obtain a judicial accounting, which of the following is the most likely reason that a court might find in favor of the nephew?
The nephew can extract spring water from the property because he holds a fee simple defeasible in the quarry.
The nephew’s extraction of spring water from the property does not constitute bad faith use of the quarry.
The nephew can extract spring water from the property because he has a possessory interest in the quarry.
The cousin cannot prevent the nephew from extracting water from the property because she has no interest in the quarry.
The correct answer is: The nephew can extract spring water from the property because he holds a fee simple defeasible in the quarry.
Discussion of correct answer: The nephew holds a fee simple subject to an executory interest (one of the three kinds of defeasible fees) and may use the estate in the same manner as a person who holds a fee simple (that is, subject only to government power to impose land use restrictions or to bring a condemnation action). The language “but if the nephew dies without issue, then to his cousin and her heirs and assigns” is conditional language that limits the duration of the nephew’s present fee simple estate such that it will automatically terminate if he dies without issue and title to the quarry will pass to the cousin. As owner of the present fee simple estate, the nephew can remove spring water from the quarry without consulting his cousin, who holds a future interest in the property.
A father conveyed a home “to my son and my daughter as co-tenants.” The daughter lived with her husband in another state and did not want to possess the home. The son, who had just graduated from college, moved into the home. Two years later, the daughter asked the son to move out and to find a renter for the home. Another year passed, and the son was still living in the home. The daughter was upset that she was not seeing any income from the property.
Is the daughter entitled to collect rent from the son?
(A) No, because the daughter lives in another state.
(B) No, because the son has not wrongfully ousted the daughter from the property.
(C) Yes, because the son and the daughter are tenants in common.
(D) Yes, because the son is in possession of the home.
(B) No, because the son has not wrongfully ousted the daughter from the property.
A landlord owns several large apartment buildings in a college town, and many of his tenants are students at one of the private colleges or the public university in town. In a period when renting apartments in one particular building had become more difficult due to a high vacancy rate throughout the town, the landlord rented a two-bedroom apartment to a law student pursuant to a two-year lease. The lease contained language prohibiting any assignment “absent the express consent of the lessor.” Ten months later, the law student decided to move to another apartment complex to live with friends, and transferred the remainder of her lease to a friend. The landlord soon learned of the transfer and sued to enforce the assignment prohibition against the friend.
What is the likely outcome of the suit?
(A) The friend will prevail, because the prohibition unreasonably restrains the law student from alienating her property interest.
(B) The friend will prevail, because the landlord’s acceptance of the friend as a tenant fulfills his duty to mitigate.
(C) The landlord will prevail, because the prohibition is enforceable against the friend.
(D) The landlord will prevail, because the law student has surrendered the premises
(C) The landlord will prevail, because the prohibition is enforceable against the friend.
A driver and passenger were driving to work in the driver’s car. As they were driving, the passenger suddenly pointed to an overturned vehicle along the side of the highway. As the driver turned to look at the overturned vehicle, he failed to see an abandoned vehicle about 200 feet in front of him. Seconds later, the driver crashed into the abandoned auto and was injured. The jurisdiction has a comparative negligence statute. The driver asserted a claim against the owner of the abandoned vehicle.
What is the most likely result?
A. The driver will recover all of his damages because the defendant created a dangerous condition.
B. The driver will recover only a portion of damages because the abandoned vehicle was in plain view.
C. The driver will recover nothing because he had the last clear chance to avoid the collision.
(D) The driver will recover nothing because the passenger’s act was a supervening cause.
B. The driver will recover only a portion of damages because the abandoned vehicle was in plain view.
A law student went to a coffee shop to study. Just as the law student was entering the coffee shop, an art student stopped her saying, “This is a place of beauty. We don’t want law students here.” The law student was angered by this remark and said, “Get out of my way.” The art student said, “No. Make me.” The law student took out her full-sized umbrella, intending to frighten the art student, and swung it near her head. However, the umbrella broke and a large piece flew off, striking the art student.
If the art student sues the law student for battery, will she prevail?
(A) No, because the art student provoked the law student with her offensive comments.
(B) No, because the law student did not intend for the umbrella to come in contact with the art student.
(C) Yes, because she was struck by the umbrella.
(D) Yes, because the law student failed to conduct herself as a reasonably prudent person.
(C) Yes, because she was struck by the umbrella.
A rancher granted Greenacre to his son-in-law, the son-in-law’s heirs and assigns, provided that the son-in-law is survived by issue of himself and the rancher’s daughter, but if the son-in-law dies without issue of himself and the rancher’s daughter, then to the rancher’s nephew. The son-in-law has discovered that the mountains on the eastern edge of Greenacre are rich in copper.
May he properly mine copper from Greenacre?
No, because, under the open mines doctrine, the son-in-law is not permitted to open a new mine after he takes possession of Greenacre.
No, because mining at Greenacre would invade the nephew’s future interest in the property.
Yes, because the son-in-law holds a fee simple determinable, so he may use Greenacre as he pleases.
Yes, because the son-in-law holds a fee simple subject to an executory interest, so he may use Greenacre as he pleases.
The correct answer is: Yes, because the son-in-law holds a fee simple subject to an executory interest, so he may use Greenacre
as he pleases.
Discussion of correct answer: The son-in-law was granted a fee simple subject to an executory interest in Greenacre. The “heirs and assigns” language creates a fee interest, and the words of condition that require that the son-in-law die survived by children of himself and the rancher’s daughter establish that the fee is defeasible; upon the occurrence of the specified condition (no children of the son-in-law and the rancher’s daughter survive him), the fee interest in Greenacre passes to the rancher’s nephew. The owner of a fee interest is not limited (except as specified in the grant of the fee) in the manner in which he may use the property. Holders of executory interests have no right to complain of “waste,” as do remaindermen who follow a life estate. Therefore, the son-in-law may open a mine on Greenacre without regard for the nephew’s interest.
Several farmers in a drought-ridden state jointly decided to sell their land to a developer, negotiating a good price and extracting a promise from the developer to build only upscale ranch-style homes on lots no smaller than ten acres each. After the sale was consummated, the developer proceeded to develop and sell large homes on the lots, including in each deed a restrictive covenant by which the grantee promised not to subdivide his or her parcel. Before the developer had completed constructing homes on all of the lots, a son offered to purchase the last five ten-acre lots unimproved. The developer sold the last lots to the son subject to the same restrictive covenant as was contained in the other deeds. The son immediately resold the lots to his father’s construction company. His deed did not contain the restrictive covenant. The construction company then sought and obtained a zoning change and construction permit for the development of 200 condominiums on small lots to be subdivided from the original five lots. A homeowner, the first purchaser of a home from the developer, brought an action against the construction company to prevent the subdivision as a violation of the restrictive covenant.
What will be the likely outcome?
Judgment for the homeowner, because the county could not alter the zoning classification in violation of the vested property rights of the previous purchasers of the developer’s lots.
Judgment for the homeowner, because the restrictive covenant is enforceable against the construction company.
Judgment for the construction company, because enforcement of the restrictive covenant would constitute an unreasonable restraint on alienation.
Judgment for the construction company, because the county may rezone regardless of vested property rights.
The correct answer is: Judgment for the homeowner, because the restrictive covenant is enforceable against the construction company.
Discussion of correct answer: This is the best answer because the restrictive covenants appear to meet the requirements for enforceability and running with the land: they touch and concern the land, there was intent and notice that the restrictions would run with the land, and there was horizontal and vertical privity. Even if they are not enforceable as covenants, they would be enforceable as implied reciprocal servitudes, because they were part of a common development plan that put the construction company on notice.
A gym owner entered a five-year lease of commercial property with a landlord. The gym owner drilled holes into the concrete floor and affixed a large pull-up bar system in the middle of the space. Prior to the end of the lease term, the gym owner removed the pull-up bar system from the space, causing damage to the concrete floor.
Is the gym owner liable to the landlord?
A. Yes, because the removal of the pull-up bar system caused damage to the concrete floor.
B. Yes, because the pull-up bar system was a trade fixture that became part of the realty which the gym owner could not remove.
C. No, because the pull-up bar system was a trade fixture which the gym owner was free to remove.
D. No, because the gym owner removed the pull-up bar system before the end of the lease term.
A. Yes, because the removal of the pull-up bar system caused damage to the concrete floor.
A developer bought a 25-acre parcel of land and obtained the required government permits to subdivide the land and construct single-family homes on quarter-acre lots. He sold the first 50 homes and conveyed each with a deed containing an express restriction that the lot be used only for single-family residences. None of the deeds mentioned any covenants regarding restrictions on other property in the subdivision, but the developer orally promised each buyer that the entire subdivision would be restricted to single- family residence use.
The developer then began work on another project and left the job of selling the remaining lots to an agent. The deed to Lot 51 did not contain the restriction on use that had been contained in the earlier deeds. Lot 51’s buyer decided to open a small business selling lottery tickets and videos on his lot. The buyer of Lot 1 filed an action to enjoin the construction and operation of the business.
Who will prevail?
The Lot 51 buyer, because the deeds to Lots 1-50 are outside his chain of title.
The Lot 51 buyer, because the developer’s oral promise to restrict the remaining lots cannot be enforced by the buyers of Lots 1-50.
The Lot 1 buyer, because the Lot 51 buyer effectively had notice of the restrictions in the other deeds.
The Lot 1 buyer, because the developer orally promised that the whole subdivision would be subject to the single- family use restriction.
The correct answer is: The Lot 1 buyer, because the Lot 51 buyer effectively had notice of the restrictions in the other deeds.
Discussion of correct answer: A party has inquiry notice of a deed restriction, even if it is not recorded in the deed. The inquiry notice would come from the appearance of the property. Because all of the nearby property was single-family residential, the Lot 51 buyer should have been on notice to inquire whether businesses would be allowed.
A buyer purchased two lots for $1 million on a long, flat, sandy coastal island that contained many public beaches, as well as homes further back from the beaches. The buyer intended to build two houses, in line with other houses, giving each house an ocean- front view. However, after the purchase of the two lots, the state enacted land-use legislation protecting the area near the beaches from any further development. The buyer sued the state, alleging that his property had been taken for a public purpose without just compensation.
Is the buyer entitled to damages of $1 million?
No, because the state acted within its police power in adopting the zoning scheme.
No, because the buyer can still camp or picnic on his two lots.
Yes, because the buyer has been denied all reasonable, economically beneficial uses of his land.
Yes, because the state can never rezone an area.
The correct answer is: Yes, because the buyer has been denied all reasonable, economically beneficial uses of his land.
Discussion of correct answer: The Fifth Amendment provides that private property shall not be taken for public use without just compensation. This prohibition applies to the states through the Due Process Clause of the Fourteenth Amendment. The U.S. Supreme Court held that a property owner is categorically entitled to compensation for a “taking” when the owner has been deprived of all economically beneficial or productive use of the land [Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992)]. The courts do not need to weigh the three prongs for a partial taking by a zoning law when the owner has clearly been deprived of all use of his property. Thus, here, the buyer is entitled to the full $1 million from the state.
A landlord agreed to lease his townhouse to a tenant for a period of one year. The written lease agreement stated that the lease would automatically renew for successive one-year periods unless either the landlord or the tenant gave notice of termination at least one month (and no more than two months) in advance of the end of the period. One year passed after the landlord and tenant executed the lease agreement, and neither gave notice of termination.
After the one-year anniversary of the execution of the lease agreement, what type of tenancy do the landlord and tenant have?
(A) An implied tenancy.
(B) A term of years.
(C) A periodic tenancy.
(D) An at-will tenancy.
(C) A periodic tenancy.
A farmer leased a large country estate for a period of five years. One bright, sunny day, a year after the farmer had moved onto the estate, the farmer’s neighbor was flying a kite in the neighbor’s backyard. The wind picked up and sent the neighbor’s kite flying onto the farmer’s estate, where it became entangled in the limbs of one of the estate’s large trees. The farmer discovered the kite and called the neighbor about retrieving his kite from her tree. However, unable to afford to pay someone to climb the immense tree to retrieve the kite, the neighbor decided to simply abandon the kite and refused to remove it.
Will the farmer prevail in an action against the neighbor for trespass to land?
(A) Yes, because the neighbor’s kite is a tangible physical object that entered the estate.
(B) Yes, because the neighbor failed to remove the kite.
(C) No, because the farmer doesn’t own the estate.
(D) No, because the neighbor abandoned the kite.
(B) Yes, because the neighbor failed to remove the kite.
A man owned a mansion on 100 acres where he raised ostriches and ran a record company. He purchased the property for $5,000,000. He paid the seller a down payment of $1,000,000 and secured a mortgage from a bank for $4,000,000. The interest rate on the mortgage loan was fixed at 7% for a term of 30 years. In order to secure the loan in a timely manner, he signed documents at closing in which he waived his right to redeem the property in the event of foreclosure. He had an attorney represent him at the closing. For four years, income from the record company and selling ostrich eggs to local eateries was sufficient to pay the $27,000 per month mortgage payment. Due to a downturn in the demand for the man’s type of music, and the loss of numerous ostriches from. disease, he defaulted on the mortgage loan. The bank commenced foreclosure proceedings. The bank had the property appraised at $8,000,000. After hearing about the appraisal, the man borrowed money from his music industry friends. The judge granted the bank’s motion for summary judgment and set a date for a sheriff’s sale. The man tendered a check to the bank in the amount sufficient pay off the mortgage and all debt otherwise due on the loan. The bank refused to accept his payment. His attorney filed a motion to dismiss the foreclosure suit.
Should the motion be granted?
(C) No, because he may only redeem the property after the foreclosure sale.
(A) Yes, because he was entitled to redeem the property even after the foreclosure sale.
(B) Yes, because the waiver of the right to redeem was invalid.
(D) No, because he waived the equitable right of redemption.
(B) Yes, because the waiver of the right to redeem was invalid.
Senior Bank held a $100,000 purchase-money mortgage on a cottage. Since the cottage was too small, the owner took a $50,000 mortgage from Junior Bank to build a new media room extension on the cottage. The initial terms of the first mortgage included a 5% interest rate for a term of 15 years. The owner was having trouble making her payments. After she called Senior Bank to discuss the issue, Senior Bank offered to modify her loan. The modification increased the term to 30 years and lowered the monthly payment accordingly. The owner defaulted on the loan. Senior Bank filed a foreclosure complaint against the owner and Junior Bank. Junior Bank filed an answer claiming that its mortgage had priority over Senior Bank’s mortgage to the extent of the material prejudice against it. The jurisdiction followed the lien theory of mortgages.
Did Junior Bank’s mortgage have priority?
(A) No, because Senior Bank’s mortgage was a purchase-money mortgage.
(B) No, because the loan modification did not materially prejudice Junior Bank’s interest.
(D) Yes, because the loan modification materially prejudiced Junior Bank’s interest.
(C) Yes, because Senior Bank modified its mortgage
(B) No, because the loan modification did not materially prejudice Junior Bank’s interest.
An environmentalist conveyed a tract of land “to the people of the state, but if any portion of the tract shall ever be used for any commercial purpose or otherwise converted from its natural state (with exception for recreational, scientific, or educational purposes), then the grantor or his successors in interest may re-enter as of the grantor’s former estate.”
What is the state’s ownership interest in the tract of land?
(A) Fee simple determinable.
(B) Fee simple subject to condition subsequent.
(C) Easement appurtenant.
(D) Determinable fee subject to an executory interest.
(B) Fee simple subject to condition subsequent.
A manufacturer of component parts supplied pedals to a large bicycle producer. One of the pedals ended up being defective but was still placed on a bicycle because the producer was not aware that the pedal was defective. The bicycle was later sold to a father, who bought it for his son. Two weeks after the purchase of the bicycle, the defective pedal broke when the son was riding his bicycle at a local park. As a result, the boy crashed into an elderly man, who suffered serious injuries. The elderly man filed a strict product liability action against the bicycle producer.
Will the elderly man prevail in his lawsuit?
(A) Yes, because the bicycle producer is in the chain of distribution.
(B) Yes, because of the consumer expectation test standard.
(C) No, because the defect is the fault of the manufacturer of component parts.
(D) No, because the elderly man was not using the defective product.
(A) Yes, because the bicycle producer is in the chain of distribution.
A tattoo parlor had a sign in the window that said “Temporary Tattoos Also Available.” The tattoo artist showed a customer samples of her work. The customer picked out a design, and paid to have the tattoo done. The customer thought that he was getting a temporary tattoo, but did not communicate this to the artist. The artist gave the customer the tattoo. After several weeks, the customer concluded that the tattoo was permanent, not temporary. He brought an action against the tattoo artist for battery.
Will the customer’s suit against the tattoo artist for battery be successful?
(A) No, because the customer gave his express consent to the tattoo.
(B) No, because the customer gave his implied consent to the tattoo.
(C) Yes, because the customer’s consent to the tattoo was obtained by fraud.
(D) Yes, because the customer’s consent was based on a mistake.
(A) No, because the customer gave his express consent to the tattoo.
A tenant entered into a two-year lease with a landlord for an apartment. Six months into the lease, the tenant fell asleep while smoking and caused a fire that destroyed the apartment. As a result, the tenant moved out. The next month, the landlord demanded that the tenant pay rent, but the tenant refused,, citing the destruction of the property. The landlord sued to recover the unpaid rent.
Who will prevail?
(A) The tenant, because the property has been destroyed.
(B) The tenant because he has moved out of the property.
(C) The landlord, because the tenant negligently caused the destruction.
(D) The landlord, because the tenant leased only part of the property.
(C) The landlord, because the tenant negligently caused the destruction.
Explanation
The correct answer is:The landlord, because the tenant negligently caused the destruction.
Discussion of correct answer:At modern law, when leased property is destroyed, the tenant is relieved from the duty to pay rent, and there is no longer any distinction between a tenant who leases part or all of a building. However, there is an exception to this rule–where the tenant intentionally or negligently causes the destruction, the tenant will not be relieved from liability. Because the tenant here negligently caused the fire that destroyed the apartment, he will not be excused from paying rent.
Discussion of incorrect answers:
Incorrect. The tenant, because the property has been destroyed. At modern law, when leased property is destroyed, the tenant is relieved from the duty to pay rent, and there is no longer any distinction between a tenant who leases part or all of a building. However, there is an exception to this rule–where the tenant intentionally or negligently causes the destruction, the tenant will not be relieved from liability. Because the tenant here negligently caused the fire that destroyed the apartment, he will not be excused from paying rent.
Incorrect. The tenant, because he has moved out of the property. This answer choice appears to be asserting a constructive eviction defense–that the tenant can no longer use the premises and has in fact moved out. However, the destruction here was caused by the tenant’s negligence, and as a result, the tenant will not be relieved from liability for paying rent.
Incorrect. The landlord, because the tenant leased only part of the property. This answer is incorrect because it is asserting the common law rule, not the modern law rule, and even then, is doing so incorrectly. At common law, a tenant who leased all of the premises was not relieved from liability when the property was destroyed because the tenant would still have possession of the land. However, a tenant who leased only a portion of the building was relieved if the property was destroyed. At modern law, however, there is no distinction between leasing all or part of the property; either way, the destruction of the property will relieve the tenant of his obligations. However, there is an exception to this rule where the tenant intentionally or negligently causes the destruction, which is the case here.
A rancher had a loan with a bank secured by a mortgage on his ranch. The mortgage deed contained a provision at the time of creation waiving the rancher’s right to redeem in the event of foreclosure. The rancher defaulted on the loan, and the bank foreclosed on the ranch. A buyer bought the ranch for $150,000 at a public foreclosure sale. The amount due on the note was $160,000. Two months after the foreclosure sale, the rancher received a large inheritance. A statute in the jurisdiction provides: “A mortgagor shall have the right to redeem the mortgaged property within six months after a foreclosure sale by matching the foreclosure price.“
Can the rancher redeem the ranch from the buyer for $150,000?
(A) No, because the rancher waived the right to redeem in the event of default and foreclosure.
(B) No, because the rancher did not exercise the right to redeem before the foreclosure sale took place.
(C) Yes, because the buyer was on notice of the rancher’s interest in the ranch.
(D) Yes, because the rancher may redeem the ranch from the buyer within six months of the foreclosure sale.
(D) Yes, because the rancher may redeem the ranch from the buyer within six months of the foreclosure sale.
A six-year-old boy often came onto a neighbor’s property to play basketball in the neighbor’s driveway, shooting at the basket attached to the neighbor’s garage. The neighbor often returned home from work to find the boy playing in the driveway. The neighbor decided to dig a well to provide irrigation for his lawn and garden. As the work was being done, the contractor left a large piece of equipment in the yard every evening. One day, after the contractor’s employees had gone home for the evening, the boy came over to play basketball. Curious, he began to climb around the machine, which was able to be started by simply pushing a button; no key was required. The child began to press each button and turn each handle he could reach. Eventually, he pressed the ignition button and the machine began to move. Scared, the child jumped from the still running machine and landed on a pile of dirt, breaking his ankle. The machine continued on its path and eventually struck a support beam in the neighbor’s deck, causing the deck and a section of the roof to collapse. The child’s parents filed suit on his behalf, naming as defendants both the neighbor and the contractor.
In a pure comparative negligence jurisdiction, who will prevail?
A. The neighbor, because he had no duty to maintain or inspect the equipment.
B. The neighbor, because the child was a trespasser.
C. The child, because the neighbor is strictly liable for injuries due to unusually dangerous activities on his property.
D. The child, because it was reasonably foreseeable that he would be on the neighbor’s property.
D. The child, because it was reasonably foreseeable that he would be on the neighbor’s property.
One morning, a small, frail, elderly man was waiting at a crowded bus stop for the city bus to go to the local senior center. When the bus arrived, a shopper, who was carrying a large handbag, got on in front of him. As the man struggled to manage the steep stairs onto the bus, the shopper’s handbag, which was quite heavy, swung back and hit him, throwing him off balance. The man fell back into the street and broke his hip. It was later revealed that the shopper had been carrying a large handgun in her purse, which was what had made the bag so heavy. While the shopper had a permit for the weapon, the jurisdiction in question had enacted an ordinance prohibiting the carrying of concealed weapons. The man files a lawsuit against the shopper to recover his medical expenses on grounds of negligence per se.
Will the man prevail?
A. No, because the harm was not of the type that the statute was designed to prevent.
B. No, because the man’s injuries were unforeseeably extensive.
C. Yes, because the handbag was heavy due to the gun, and the man was within the class of people the statute was designed to prevent.
D. Yes, because the man can prove causation and damages.
A. No, because the harm was not of the type that the statute was designed to prevent.
A jeweler arranged to purchase a strip mall for $1 million and obtained a loan from a local bank for the full purchase price. Over the course of the next few years, several tenants left the strip mall. In an effort to revive the strip mall, the jeweler arranged to convey the strip mall to one of her regular customers, who was the beneficiary of a trust fund and had recently come into a great deal of money. The customer agreed in writing to assume the jeweler’s mortgage. After several months, however, when business at the strip mall still had not improved, the customer stopped making the mortgage payments on the property.
From which party or parties may the bank pursue payment of the mortgage?
A. The jeweler only, because the jeweler did not obtain a novation.
B. The customer only, because the customer agreed to assume the mortgage.
C. The customer only, because the customer took the strip mall subject to the mortgage.
D. The jeweler or the customer, because both parties are personally liable for the mortgage payments.
D. The jeweler or the customer, because both parties are personally liable for the mortgage payments.
Discussion of correct answer: Under the facts presented, the jeweler was the original mortgagor of the strip mall, and the bank was the mortgagee. If a mortgagor transfers the property “subject to the mortgage” and mortgage payments are not made, the mortgagee may foreclose and force the property to be sold, but the transferee does not have personal liability for the debt. In contrast, if the transferee of mortgaged real property “assumes the mortgage” and mortgage payments are not made, the mortgagee may foreclose and force the property to be sold, and, in addition, the transferee is personally liable for any deficiency. Finally, in a novation, the transferee of real property and the mortgagee agree that the transferee will assume the mortgage and the mortgagor will be released from liability. In this case, the customer assumed the mortgage, and is therefore personally liable for payment of the amount still owed to the bank. However, given that the bank never agreed to release the jeweler from liability, no novation occurred, and the jeweler likewise remains personally liable for the remaining mortgage payments. As such, the bank may pursue payment from either party, and this answer is correct.
A colonel had never forgiven his only son for refusing to follow in his footsteps as a career military officer. When the colonel became too ill to enjoy riding the horses he kept on his ranch, he conveyed it to his lifelong friend and fellow military retiree, “for life, remainder to the children of my son.” At the time of this conveyance, the son was married but had no children.
After the conveyance of the ranch, which of the following best describes the interest that the son’s children hold in the ranch?
A contingent remainder.
A shifting executory interest.
A springing executory interest.
They have no interest in the ranch.
The correct answer is: A contingent remainder.
Discussion of correct answer: The future interest created in a third party that follows a life estate (or estate for years) created in a grantee is a remainder. Remainders may be vested or contingent. A vested remainder is one that is: (1) created in an ascertained person; and (2) is not subject to a condition precedent. A remainder not possessing these characteristics is contingent. In this problem, the colonel conveyed a life estate in the ranch to his dear friend, followed by a remainder to the unborn children of the colonel’s son. Because those children of the son are unborn (and therefore unascertained), their remainder interest is contingent; as each child (if any) is born, that child’s interest would vest, subject to open (i.e., subject to reduction by the birth of another child to the son).
A tenant rented an apartment from a landlord. The landlord did not have the tenant enter into a written lease.
Which of the following is not an implied duty of the tenant at the end of his tenancy?
(A) To find a new tenant.
(B) Not to commit waste.
(C) To leave the place in the condition it was rented, reasonable wear and tear excepted.
(D) To leave at the end of the tenancy.
(A) To find a new tenant.
An investor purchased Blackacre from the owner for $250,000, paying $50,000 as a down payment, and issuing a mortgage on Blackacre to secure payment of the remaining $200,000 plus interest over a period of 10 years. The mortgage arrangement called for the investor to pay $2,000 per month, with $800 allocated to interest and the rest to principal. Two years later the investor died, leaving a will devising Blackacre “to my wife for life, remainder to my daughter.”
Between the wife and the daughter, how should the burden for payment be allocated?
(A) The daughter is obligated to pay the interest, and the wife is obligated to pay the principal.
(D) The wife is obligated to pay both the principal and the interest.
(B) The daughter is obligated to pay the principal, and the wife is obligated pay the interest.
(C) The daughter is obligated to pay both the principal and the interest.
(B) The daughter is obligated to pay the principal, and the wife is obligated pay the interest.
An actress had owned Fernwood, a 100-acre tract, for most of her ninety years. Fernwood was located in the town of Boone, which has little land available for development other than the actress’ property. Developers had approached the actress for three decades with offers to purchase Fernwood, but she refused all overtures. When the actress determined that she was facing her final decline, she decided to resolve the issue of the future ownership of Fernwood and began to consider offers. Eventually, when friends asked her who the new owner was, the actress would only reply, “That’s all taken care of.”
The actress died leaving no heirs. Following her death, two parties emerged claiming ownership of Fernwood or a portion thereof. One was a developer planning a subdivision on the tract; the other was a director claiming to own the 10 central acres of the tract. The developer produced a properly executed land sale contract in which the actress agreed to convey Fernwood to the developer for $1.5 million. The director produced a handwritten document signed by the actress in which she agreed to sell to the director 10 acres of Fernwood “chosen and bounded by the buyer” for the price of $1,500 per acre to be paid in cash. The contract the director produced was dated one week prior to the contract produced by the developer. A site visit to Fernwood revealed stakes placed by the director bounding the central 10 acres of the 100-acre tract. The developer’s loss of the 10 acres would severely constrict the planned subdivision roadways and configuration.
If the developer sues to quiet title to Fernwood’s 100 acres, what is the most likely outcome?
The developer will prevail, if he has already started making improvements on the property.
The developer will prevail, because the actress-director land sale contract does not contain an essential term.
The director will prevail, because the actress-director agreement is signed by the party to be charged.
The director will prevail, because the boundary of the 10-acre tract within Fernwood is accurately marked by stakes.
The correct answer is: The developer will prevail, because the actress-director land sale contract does not contain an essential term.
Discussion of correct answer: The statute of frauds requires land sale contracts to be in writing, be signed by the party to be charged, and contain the essential terms of the contract, including the parties, a description of the property, and the terms and conditions of price and payment. Even if the actress-director agreement contains the signature of the party to be charged, the contract must comply with all of the other requirements of the statute of frauds. Here, the physical marking of the boundary of a tract purported to be conveyed by a land sale contract does not satisfy the statute of frauds.
At a family gathering to celebrate the Fourth of July, an uncle saw his favorite niece, who was just about to start college in his hometown. Knowing that she needed a place to stay, he proposed that she rent a room in a house that he owned, located just off campus, for $500 a month until she graduated. The niece was elated to find something so close and reasonably priced. They shook hands on the deal, and the niece moved in on August 1.
One month prior to the niece’s graduation, the uncle’s lawyer sent a letter to the niece demanding that she vacate the premises on the day after her graduation. On graduation day, the niece sent her uncle a check for the next month’s rent. The following day, the uncle brought an action to evict her.
What is the proper outcome?
(A) The niece is entitled to stay, because she and her uncle entered into a periodic tenancy, which was automatically renewed.
(B) The niece is entitled to stay until the uncle provides her with written notice of his intent to rent the apartment to someone else.
(C) The uncle may evict the niece, because she is a tenant at sufferance.
(D) The uncle may evict the niece, because he sent a letter demanding that she vacate the premises.
(C) The uncle may evict the niece, because she is a tenant at sufferance.
A man owned Debtacre. The man borrowed $50,000 from a bank and issued a mortgage on Debtacre to the bank to secure repayment of the debt. The bank immediately recorded the mortgage. Six months later the man borrowed $25,000 from his friend and gave his friend a mortgage on Debtacre to secure repayment of the debt. The friend immediately recorded her mortgage. Two months later the man then borrowed $20,000 from his father and gave his father a mortgage on Debtacre to secure repayment of the debt. The father immediately recorded his mortgage. One month later the man defaulted on the debt to bank and bank foreclosed. Both the friend and the father were notified of the foreclosure proceeding. At the foreclosure sale the father bought the property for $30,000. The $30,000 was paid to the bank. However, the bank was still owed an additional $10,000 on the original debt. The man had made no payments to either the friend or the father, so the full amounts of those debts are still owed.
Which of the following properly describes how title to Debtacre is held?
A. The father owns Debtacre free and clear of any mortgage interest.
B. The bank only has a mortgage on Debtacre for $10,000.
C. The friend only has a mortgage on Debtacre from $25,000.
D. The bank has a mortgage on Debtacre for $10,000 and the friend has a mortgage on Debtacre for $25,000.
A. The father owns Debtacre free and clear of any mortgage interest.
A farmer died owning 10 acres of farmland, part of a once-large tract of farmland that was now almost completely surrounded by housing developments. In the last few years before his death, the farmer used the acres fronting a local road for his home and to run a small farmers’ market, at which he sold produce grown on the “back” acres of his property. The farmer had no other access to these back acres other than via a dirt road that ran from the back acres past his house and out to the public road. The farmer left the property to his daughter.
The daughter sold the front four acres of the land, including the old homestead, to an entrepreneur and the remaining six acres to a construction company for the purpose of building townhouses. Neither deed contained any mention of an easement involving the dirt road. The entrepreneur planned to run a small home-based business on the property, supplying baked goods for her friend’s catering business. The construction company’s land had access to the public road only by means of the dirt road across the entrepreneur’s land. The construction company had no problem moving construction equipment over the dirt road, but now sought to pave the road in order to begin bringing in customers to look at their model homes. The entrepreneur refused to allow the construction company to pave the road because she feared that the noise and traffic would cause her cakes to fall.
If the construction company requests court permission to pave the road, in whose favor should the court rule?
For the construction company, because it has an implied easement and the right to repair and maintain it.
For the construction company, because its pavement of the road is within the reasonable contemplation of the parties.
For the entrepreneur, because the deed to the construction company did not expressly grant an easement across the entrepreneur’s property.
For the entrepreneur, because the owner of the servient estate has the ultimate right to control the maintenance of an easement.
The correct answer is:For the construction company, because its pavement of the road is within the reasonable contemplation of the parties.
Discussion of correct answer:The owner of an implied easement has a limited right to upgrade the easement, and generally may not develop or upgrade it beyond the reasonable contemplation of the parties at the time the property was divided. This answer is correct because the daughter sold the land to the construction company knowing that it would be used for townhouses and that the homeowners would need access to the public road. It was thus reasonably within the contemplation of the daughter and the construction company that the road would eventually need to be paved.
A pre-med student and a biology student lived together in a rental house off-campus. During the semester break, the campus dormitories were closed, and students were not permitted to stay on campus. An education student, who lived on campus, asked the pre-med student if he could spend the semester break at his house. The pre-med student, who was going to visit his family during the break, agreed. The pre-med student gave the education student a key to the house and told him, “My room is yours.” Then the pre-med student left town, leaving a note on the table for the biology student, informing him that the education student would be staying for the break.
That afternoon, the biology student came home after class but did not notice the pre-med student’s note. Late that night, the biology student was awakened by the sound of someone downstairs. He came down to investigate and discovered the education student in the hallway outside of the pre-med student’s room. Before the education student had a chance to explain, the biology student seized him, opened the front door, and pushed him out. The education student fell and fractured his leg.
Will the biology student face liability for forcibly removing the education student from the house?
(A) No, because the biology student can successfully assert self-defense.
(B) No, because the biology student used non-deadly force.
(C) Yes, because the biology student had a duty to retreat.
(D) Yes, because the education student was privileged to be in the house.
(A) No, because the biology student can successfully assert self-defense.
A landscaper entered into a commercial lease with a tailor who planned to operate a tailoring factory on the leased premises. During the term of the lease, the tailor firmly affixed $20,000 worth of state-of-the-art storage racks to the wall of the premises. At the end of the lease term, the tailor vacated the premises without removing the racks, and the landscaper leased the premises to the owner of a taxidermy business. The taxidermy business moved into the premises immediately after the expiration of the tailor’s lease. One day after the expiration of the tailor’s lease, the tailor’s shop foreman returned to the premises to remove the storage racks that the tailor had installed. The taxidermist refused to allow the foreman to remove the racks. The jurisdiction follows the majority rule. The tailor filed suit against the landscaper to recover the storage racks.
Who should prevail?
A The landscaper, because the racks now belong to him.
B The landscaper, because the tailor may not use self-help to remove trade fixtures left over from an expired tenancy.
C The tailor, because his ownership of storage racks was not affected by the termination of the lease.
D The tailor, because the racks are not part of the realty.
C The tailor, because his ownership of storage racks was not affected by the termination of the lease.
Discussion of correct answer: A vacating tenant’s ownership of trade fixtures is in fact affected by termination of the lease. If a vacating tenant does not remove trade fixtures from the leased premises within a reasonable time after the termination of the lease, ownership of the trade fixtures passes to the landlord. Here, given that the tailor attempted to remove the shelves one day after the termination date of the his lease, the tailor still owns the racks and may remove them. However, if the tailor had not attempted to remove the racks within a “reasonable time” after the termination of the lease, ownership of the shelves would have passed to the landscaper.
A businesswoman worked at her company’s headquarters. She was informed by her boss that for the next 6 months her presence would be needed at one of the company’s satellite offices. The businesswoman found an apartment near the satellite office and signed a six-month lease of the apartment to begin January 1 at a rent of $1,000 per month. The businesswoman moved into the apartment on January 1, and paid the rent each month for the six month period. Near the end of June the businesswoman’s boss informed her that her continued presence would be required at the satellite office for an additional month.
On July 1, the businesswoman gave the apartment owner a check for $1,000, telling the apartment owner that she would be staying a while longer. The apartment owner accepted the check. The businesswoman then learned that her presence at the satellite office would not be required after July. On July 31, the businesswoman vacated the apartment and moved back to her home near the company headquarters. The apartment owner brought suit against the businesswoman for rent due.
How much rent, if any, is the apartment owner likely to receive?
(A) Nothing, because the businesswoman effectively terminated the lease when she moved out on July 31.
(B) $1,000 for the month of August.
(C) $5,000 for the months of August through December.
(D) $6,000 for the months of August through January.
(B) $1,000 for the month of August.
A developer owns a large tract of land that she has subdivided into 80 smaller parcels and plans to develop as a residential community. She creates a development scheme for the property and begins to sell lots to buyers. As part of the development scheme, the developer constructs an extensive set of running and bicycling trails throughout the property. In the deed to each lot, the developer inserts a restriction that the lot will not be used for any other purpose other than the construction of a single-family residence. The developer has no land-use plans for the land other than the residential lots and the trail system. The deeds contain a provision guaranteeing lot owners access to the trails. Each deed also contains a clause obligating every lot owner to pay an annual fee to maintain the trails. Finally, the developer inserts a provision in each deed stating that both the benefit of using the system of trails and the burden of the annual maintenance fee shall transfer to any subsequent owner of a lot in the development.
Which of the following options offers the developer the best means of enforcing the requirement that each buyer of a lot pay an annual fee to maintain the trail system?
Express easement.
Easement by implication.
Covenant.
Personal contractual agreement between the developer and each purchaser.
The correct answer is: Covenant.
Discussion of correct answer: Covenants are restrictions on the right to use land that run with the land. Here, the requirement that each purchaser of a lot in the development pay an annual fee to maintain the trail system is a restriction that is intended to run with the land and constitutes a covenant. As such, this is the best response.
A father took out a loan from a lender and, as security for the loan, gave the lender a mortgage on his land. The father and the lender executed a promissory note. The father later conveyed the land to his son subject to the mortgage. When the loan payments to the lender went into default, the lender foreclosed on the land. The proceeds of the foreclosure sale did not cover the amount owed to the lender.
Who is personally liable to the lender for the deficiency?
(A) Both the father and the son.
(B) The father, but not the son.
(C) The son, but not the father.
(D) Neither the father not the son.
(B) The father, but not the son.
A doctor was the first person to purchase a parcel of land in Pine Bluff, a hilly, wooded tract of land in the north woods. The deed conveying the lot contained a reasonable description of the property, but when the doctor placed boundary markers on his property line he mistook one stone outcropping for another and bounded property not his own. The doctor built a house on the outcropping, affording him a spectacular view of the forest below. The doctor lived on the property for seven years before other people began to buy lots in the Pine Bluff tract. He noticed houses being constructed in the valley below, and one day a surveyor appeared at the doctor’s door informing him that his own house was located on a parcel recently purchased by a chiropractor. The doctor immediately brought an action to quiet title, and the court found that he held legal title by adverse possession.
With the increasing development on the Pine Bluff tract, the doctor decided to move to a more remote location and placed his property on the market. The doctor entered a properly executed purchase and sale agreement with a dentist. While preparing for the closing, the attorney for the dentist discovered that a roadway constructed by the doctor on the west side of his property encroached minimally on his neighbor’s land for several hundred yards, then encroached substantially at a point where the roadway swung around the stone outcropping on which the doctor’s house sat. When informed of the encroachment, the doctor was surprised. Because of the topography of the land, it was not possible to move the roadway completely onto the doctor’s land without blasting the stone outcropping. At the closing, the dentist refused to tender performance on grounds that the doctor could not tender marketable title because of the encroachment on his neighbor’s land and because the doctor’s claim of title was based on adverse possession.
If the doctor brings suit for specific performance, what is the most likely outcome?
The dentist will prevail, because the roadway encroachment renders title unmarketable.
The dentist will prevail, because the doctor’s claim of title by adverse possession renders title unmarketable.
The doctor will prevail, because he holds legal title to the property by adverse possession as declared by the court.
The doctor will prevail, because the roadway encumbrance does not destroy marketable title where it does not materially interfere with the use of his land.
The correct answer is: The dentist will prevail, because the roadway encroachment renders title unmarketable.
Discussion of correct answer: An encumbrance is a legal interest or liability on property that affects the marketability of title. Some encumbrances, such as easements that benefit the land, do not render title unmarketable; others, such as covenants and easements that restrict the buyer’s use and enjoyment of the land, do render title unmarketable. The roadway encroachment represents a potential lawsuit that the dentist could be forced to resolve if he purchases the doctor’s land. The dentist’s purchase of the land would include “purchasing a lawsuit.” Because the doctor cannot assure him otherwise, title is unmarketable and the dentist need not perform his obligations under the purchase and sale agreement. As a remedy, the dentist can rescind the contract and recover any down payment.
Brother 1 and Brother 2 own real estate together that is occupied by Brother 1. Brother 1 wanted to obtain a loan to purchase a motor home, but the bank insisted on a mortgage. Brother 2, receiving none of the benefits, refused to sign the note, but did sign the mortgage. Brother 1 defaulted on the mortgage payments.
What liability does Brother 2 after Brother 1 defaulted on the mortgage?
(C) He will be personally liable to the bank if it obtains a judgment in foreclosure.
(B) He will be personally liable to the bank for both a judgment in foreclosure and for a deficiency judgment.
(D) He will be liable to the bank if it obtains a judgment in foreclosure, but will not owe for a deficiency judgment the bank might obtain.
(A) He will owe the bank for any deficiency judgment it obtains.
(D) He will be liable to the bank if it obtains a judgment in foreclosure, but will not owe for a deficiency judgment the bank might obtain.
An aspiring actress owned a farm, but wanted to move to the big city and pursue her dream of acting in movies. The actress executed a written deed granting title of her property to its faithful caretaker, who properly recorded the deed. The state in which the farm is located has a recording act that reads, “A conveyance of an estate in land shall not be valid as against any subsequent purchaser for value, mortgagee, or judgment creditor, except such persons having notice of it, unless the conveyance is properly recorded.”
The aspiring actress did indeed quickly become a successful, though temperamental, star. A few years after arriving in the city, she quit the production of a film for “artistic” reasons. The producers sued her for breach of contract and the court awarded them a $200,000 judgment. The producers promptly recorded a judgment lien against the farm. The producers had no actual notice of the earlier conveyance of the property to the caretaker and did not make a search of the title records. The producers then sought enforcement of the judgment lien.
Will the court enforce the judgment lien against the farm?
Yes, because the recording of the judgment lien revoked the earlier deed of the property to the caretaker.
Yes, because as a donee, the caretaker was not a purchaser for value, mortgagee, or judgment creditor protected by the recording act.
No, because the producers are not purchasers for value.
No, because the caretaker properly recorded the deed to the property.
The correct answer is: No, because the caretaker properly recorded the deed to the property.
Discussion of correct answer: This state recording act is designed to protect only those who take property “without notice.” Each transaction must be examined to determine whether the purchaser had actual, inquiry, or constructive notice of any other claims to the same property. The caretaker promptly recorded the deed to the farm prior to the producer’s judgment lien. The law charges a subsequent claimant with constructive notice of all prior conveyances affecting the subject property that have been properly recorded. Therefore, the producers cannot be protected by the recording act; they have constructive notice of the deed to the caretaker.
A brother and sister inherited their childhood home from their father as tenants in common. The brother lived on the property with his father at the time the father died. The sister lived in a distant city. After their father’s funeral, the brother continued to live on the property. There was no discussion between the siblings concerning their common ownership, nor had there ever been any The brother paid all taxes, insurance, and other carrying charges on the property. He paid no rent or other compensation to his sister, nor did she request any such payment. Thirty years later, a series of disputes arose between the siblings for the first time concerning their respective rights. The jurisdiction recognizes the usual common law types of co-tenancies, and there is no applicable legislation on the subject. The jurisdiction has a 20-year adverse possession statute. The brother now claims fee simple title and brings an action against the sister to quiet title in himself.
For whom should the court rule?
(A) The brother, because he has exercised the type of occupancy ordinarily considered sufficient to satisfy the adverse possession requirements.
(B) The brother, because the acts of the parties indicate that the sister acquiesced to the brother’s right of ownership.
(C) The sister, because there is no evidence that the brother has performed sufficient acts to constitute her ouster.
(D) The sister, because one co-tenant cannot acquire title by adverse possession against another.
(C) The sister, because there is no evidence that the brother has performed sufficient acts to constitute her ouster.
A tenant entered into a two-year lease with a landlord for an apartment. At the start of the lease term, the tenant had several friends help unload her belongings from the moving truck. Later that day, wanting to see what the apartment’s view was like, one of the tenant’s friends attempted to open the sliding glass door that led to the tenant’s balcony. However, the handle appeared to be stuck. When she pulled slightly harder, the handle came off, hitting the friend in the face and causing her to suffer a deep laceration. The previous tenant had notified the landlord of the issue, but apparently, the maintenance crew never fixed the door.
Which of the following arguments would provide the landlord with his best defense?
(A) He warned the tenant of the glass door when she did a walkthrough the week before the tenant signed the lease.
(B) The injury was sustained by a guest of the tenant.
(C) The injury did not occur in a common area of the building.
(D) The maintenance crew, and not the landlord, was the proximate cause of the friend’s injury.
(A) He warned the tenant of the glass door when she did a walkthrough the week before the tenant signed the lease.
A woman leased an apartment on January 1 for a one-year term with rent payable on the first day of the month. Her lease specified that no assignments would be permitted without express written approval from the landlord. Eight months later the woman received an unexpected promotion which resulted in a transfer to a different city. Her younger brother jumped at the chance to take over his sister’s remaining lease. The woman paid rent on the first day of September, and her brother moved in the following day.
On September 29, the landlord came to the apartment. He said that he wanted to inform all of his tenants that the water was scheduled to be turned off the following day for routine repairs. The brother informed the landlord that his sister had moved, and that he had assumed her lease. He gave the landlord a check for October’s rent. The landlord accepted and deposited the check. The following month, the landlord sued the woman for unlawful assignment.
If the woman wins, it will most likely be for what reason?
A The brother paid his rent in a timely fashion.
B There was no mention of a prohibition against subletting in the woman’s lease.
C The landlord waived his right to object to the assignment by accepting and depositing the brother’s check.
D The brother, as a relative of the original tenant, had a legal right to occupy the premises.
C The landlord waived his right to object to the assignment by accepting and depositing the brother’s check.
An accountant leased a single-family home from a landlord for $700 per month and signed a three year lease. Six month later, the accountant received a one year work assignment overseas and leased the home to a baker for one year for $800 per month. Each month, the baker sent $800 to the accountant, $700 of which the accountant sent to the landlord. With three months remaining on the baker’s lease, the accountant stopped sending rent to the landlord.
Who may the landlord sue for unpaid rent?
A. Both the accountant and the baker.
B. The accountant only.
C. The baker only.
D. Neither the accountant nor the baker.
B. The accountant only.
A skier had skied for many years. The skier was proceeding down a relatively steep hill on an advanced course by a series of traverses. He was crossing the slope a number of times to diminish the angle of descent the skiing equivalent of switchbacks in hiking. At the same time a ski instructor, who was also the owner of her own ski school and a member of the ski patrol, came straight down the hill, saw the skier midway across the hill in one of his traverses, and attempted to ski behind the skier. The ski instructor miscalculated the speed at which the skier was traveling, and ran directly into him, fracturing the skier’s knee.
The ski instructor’s conduct will be judged against which of the following standards?
A. The conduct of a reasonably prudent person.
B. The conduct of a reasonably prudent person in an emergency.
C. The conduct of a reasonably prudent person with superior skiing knowledge and expertise.
D. The conduct of a reasonably prudent person with the same age, knowledge, and experience.
C. The conduct of a reasonably prudent person with superior skiing knowledge and expertise.
A football player owned a 100-acre ranch with a house, an Olympic-size swimming pool, a small pool house, and a six-car temperature controlled garage. The player was transferred to another city so he entered into a one-year written lease with a basketball player. The lease agreement provided that the basketball player would be entitled to possession of the land, house, and garage. The lease also contained an anti-assignment clause and a provision explicitly prohibiting subletting without the football player’s express written consent.
Which of the following arrangements would not violate the lease?
A The basketball player allowed his teammate to park an Italian luxury car in the garage for $100 per month.
B The basketball player allowed his cousin to stay at the pool house for two weeks in exchange for a $25 per week.
C The basketball player allowed his friend to come onto the property to remove small amounts of gravel, which he uses in his paving business.
D The basketball player allowed his friends to swim in the pool seven days a week and provided dry towels in exchange for a $10 per day towel fee.
D The basketball player allowed his friends to swim in the pool seven days a week and provided dry towels in exchange for a $10 per day towel fee.
A man owned a small ranch just outside of a city. During the early part of the century, his predecessor-in-interest had granted an express easement to a local mining company to construct, maintain, and operate a railroad line across his property, part of a spur line that ran from coal deposits in the nearby foothills to the city.
Just after the man had acquired the ranch, coal was largely replaced as a source of fuel by natural gas and electricity produced from oil-fired plants, and the mining company stopped mining coal in the foothills and stopped using the rail line. After a few years, the mining company removed the ties, which had become popular building materials, and the rails, which were sold for scrap metal.
About four years ago, the man planted fruit orchards on his property, a portion of which occupied all of the land formerly used by the mining company’s right-of-way. Recently, long and continuous increases in the cost of oil and the collapse of the nuclear power industry made coal mining a profitable venture again. Fifteen years after it last used the rail line, the mining company notified the man that it intended to reconstruct its rail line over the right-of-way granted by his predecessor.
If the man successfully obtains judicial intervention to prevent the mining company from using the right-of-way, what is the best reasoning?
Use of the right-of-way under these circumstances would be a substantial burden upon the servient tenement.
The mining company’s easement terminated when the purpose for which it was granted ceased to be practical.
The mining company’s conduct during the 15 years of non-use evidenced an intent to abandon the easement.
Non-use for a period greater than the statutory period for adverse possession terminates an easement.
The correct answer is: The mining company’s conduct during the 15 years of non-use evidenced an intent to abandon the easement.
Discussion of correct answer: Termination of an easement by abandonment requires non-use plus some act that demonstrates the easement holder’s intent to abandon. The removal of the railroad ties and rails is the sort of additional act that evidences an intent to abandon and is the best explanation for why the man would be able to prevent the mining company from using the easement again.
