Property > Real Property Test 1 Flashcards
(4) A seller entered into a written contract to sell his factory to a manufacturer. Before the closing date, the manufacturer found an alternate site that was better suited to her business. The manufacturer notified the seller that she would not be going through with the closing. The seller sued the manufacturer for specific performance.Which choice B or D will cause the court to rule in favor of the manufacturer and why?B. The factory violates the setback requirement of the zoning ordinance.D. Access to the factory is by way of an easement over adjoining property.
B. The title is unmarketable if the zoning ordinance is violated.Cannot sue for specific performance.IMPLIED COVENANT in every land sale contract that at closing the title will be marketable.Generally zoning restrictions do not affect the marketability of title, but an EXISTING VIOLATION of a zoning ordinance renders title unmarketable.
(4) A seller entered into a written contract to sell his factory to a manufacturer. Before the closing date, the manufacturer found an alternate site that was better suited to her business. The manufacturer notified the seller that she would not be going through with the closing. The seller sued the manufacturer for specific performance.If access to the factory is by way of an easement over adjoining property, will the court rule in favor of the manufacturer?
No. An easement is an encumbrance that can render title unmarketable, but this easement encumbers the ADJOINING property, not this property.
(7) A landowner sustained injuries in a boating accident that required an extended hospital stay. During his absence a trespasser entered into a contract with an accountant to purchase the landowner’s land. The trespasser forged the landowner’s signature on a quitclaim deed, which the accountant promptly and properly recorded. Two months later the accountant received notice that he was being transferred, so he conveyed the land by a general warranty deed. The buyer promptly and properly recorded the deed. The following month, the landowner returned to his land and ejected the buyer. The jurisdiction in which the land is located has the following statute: “No unrecorded conveyance or mortgage of real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded”.Under which theory is the buyer most likely to have a remedy?C. The accountant breached the covenant of right to convey.D. Buyer is protected under the shelter rule
C. Most likely there is breach of the covenant of right to convey.A general warrant deed is one in which the grantor covenants against title defects created by himself and prior title holders. One of the usual covenants contained in a general warranty deed is the covenant of right to convey, which is a covenant the grantor has the power and authority to make the grant. It is a present covenant that is breached, if at all, at the time of conveyance if the grantor is not the owner. If there is a breach, the grantee has a cause of action against the statute of limitations begins to run at the time of conveyance. Here, the deed from the trespasser to the accountant was void because it was forged. Thus the accountant was not the owner of the land at the time of conveyance to the buyer, and the buyer has a cause of action against the accountant for breach of the covenant to convey.
(7) A landowner sustained injuries in a boating accident that required an extended hospital stay. During his absence a trespasser entered into a contract with an accountant to purchase the landowner’s land. The trespasser forged the landowner’s signature on a quitclaim deed, which the accountant promptly and properly recorded. Two months later the accountant received notice that he was being transferred, so he conveyed the land by a general warranty deed. The buyer promptly and properly recorded the deed. The following month, the landowner returned to his land and ejected the buyer. The jurisdiction in which the land is located has the following statute: “No unrecorded conveyance or mortgage of real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded”.Why isn’t the Buyer protected under the shelter rule? What is the shelter rule?
The Shelter rule does NOT protect the buyer.Under the shelter rule, a person who takes from a bona fide purchaser (BFP) will prevail against any interest that the transferor-BFP would have prevailed against. Here the accountant would not prevail in a claim against the landowner because the accountant’s deed from the trespasser is void. Thus, the buyer likewise would not prevail.
(7) A landowner sustained injuries in a boating accident that required an extended hospital stay. During his absence a trespasser entered into a contract with an accountant to purchase the landowner’s land. The trespasser forged the landowner’s signature on a quitclaim deed, which the accountant promptly and properly recorded. Two months later the accountant received notice that he was being transferred, so he conveyed the land by a general warranty deed. The buyer promptly and properly recorded the deed. The following month, the landowner returned to his land and ejected the buyer. The jurisdiction in which the land is located has the following statute: “No unrecorded conveyance or mortgage of real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded”.What is the relevance of the jurisdiction’s statute?
This notice type recording statute is irrelevant here.
(7) What is the covenant of right to convey?
A covenant of right to convey, which one in which the grantor has the power and authority to make the grant.
(8) A father executed a deed to his art gallery “ to my daughter for her life, and on my daughter’s death to her children; provided however that if my daughter stops painting, to my brother.” The daughter has two children and is still painting. At the time of the grant the interest of the daughter’s two children is best described as:B. A vested remainder subject to open and to total divestmentC. A vested remainder subject to open
B. Vested remainder subject to open and to total divestment.The daughter’s two children have a remainder because on the expiration of the daughter’s life estate, they will be entitled to possession of the property. The remainder is not subject to a condition precedent and the beneficiaries are in existence and ascertained so the remainder is VESTED, NOT contingent. The remainder is subject to OPEN because the daughter may have more children. The reminder is subject to total divestment because the daughter’s children’s right to possession is subject to being defeated by the daughter’s ceasing to paint.
(8) What is a remainder?
A remainder is a future interest created in a transferee that is capable of taking in possession on the natural termination of the preceding estate.
(8) When is a remainder vested?
A remainder is vested if the beneficiaries are ASCERTAINABLE and their taking of possession is NOT subject to a CONDITION PRECEDENT.
(8) What is a vested remainder subject to open?
A vested remainder created in a class of persons that is certain to take.
(8) What is a vested remainder subject to total divestment?
Vested remainders may be subject to total divestment if possession is subject to being defeated by the happening of a condition subsequent.
(9) A landlord owned an apartment building. Needing money to make some repairs he went to the bank and got a loan. The bank loaned $100,000 secured by a mortgage on the apartments. the landlord defaulted on the mortgage payments. The bank instituted foreclosure proceedings and wishes to take possession of the building in order to collect rent from the property.Does the bank have the right to take possession of the apartment building before foreclosure?B. Yes, if the jurisdiction follows title theory.C. No, because the landlord has a right to redeem the property before the foreclosure sale.
The bank may take possession of the apartment building before foreclosure if the jurisdiction follows the title theory.The mortgagee is entitled to possession on demand at any time.
(9) What is title theory?
Title is in the mortgagee (lender) until the mortgage has been satisfied or disclosed.The mortgagee is entitled to possession on demand at any time.
(9) A landlord owned an apartment building. Needing money to make some repairs he went to the bank and got a loan. The bank loaned $100,000 secured by a mortgage on the apartments. the landlord defaulted on the mortgage payments. The bank instituted foreclosure proceedings and wishes to take possession of the building in order to collect rent from the property.Does the bank have the right to take possession of the apartment building before foreclosure?Why doesn’t the landlord have a right to redeem the property before the foreclosure sale.
Although the mortgagor has the right to redeem the property by paying off the amount due before the foreclosure sale, the equitable right of redemption does not affect the bank’s right to possession before foreclosure.
