Real Property

Question 1

Can a LL restrict cotenants’ ability to transfer their rights under the lease with an express lease provision?

Answer 1

Yes - and only the LL, as a beneficiary, may enforce the provision, not a co-tenant

Question 2

Subrogation allows a third party to take a senior mortgage’s priority when the third party:

Answer 2

(1) fully pays off the senior mortgage, and

(2) has no actual knowledge of junior interests

Question 3

When a mortgagor transfers mortgaged property to someone who assumes the mortgage:

Answer 3

The transferee becomes primarily liable for the mortgage and the mortgagor becomes secondarily liable as a surety

If the mortgagor pays the mortgage debt after the transferee defaults, mortgagor can seek reimbursement

Question 4

In a race-notice jurisdiction, a bona fide purchasor who:

Answer 4

(1) lacks notice, and
(2) records first will prevail

*A BFP cannot rely on a forged or altered document to establish priority since that document is void

Question 5

The equitable right of redemption allows a debtor to avoid foreclosure by:

Answer 5

Paying the FULL amount of the outstanding debt

*This means that a tenant can only redeem co-owned property by paying the amount owed by ALL tenants

Question 6

A subsequent assignment of the same right:

Answer 6

revokes any prior revocable assignment (gift)

Question 7

Seller of residential property can disclaim the duty to disclose known material defects if:

Answer 7

(1) the disclaimer is clearly and specifically stated in the sales contract, and
(2) the seller has not fraudulently misrepresented or concealed the condition of the property

Question 8

“No conveyance or mortgage of real property shall be good against subsequent purchasers for value unless the same be first recorded according to law”

Answer 8

Race recording statute

Question 9

Fixtures built on real property and items incorporated into structure become part of realty, but can be removed if:

Answer 9

(1) seller reserves the right to remove fixtures in the sale contract, or
(2) leased property can be restored to former condition without damage in reasonable time

Question 10

Distribution of Foreclosure Proceeds

Answer 10

Process (attorney), senior mortgage, junior mortgage

Question 11

Tenants have a duty to:

Answer 11

Pay rent, avoid waste, and make repairs in non-residential leases

Absolute duty to repair clause in residential least will likely be void

Question 12

A co-tenant can only compel other co-tenants to share expenses for repairs if:

Answer 12

(i) the repairs are necessary, and
(ii) the co-tenant seeks accounting or partition

*No right to reimbursement for improvements or overuse

Question 13

Fee simple determinable

Answer 13

Limited by specific durational language (so long as, while, during, until)

• Automatically terminates upon happening of stated event
• Future interest: grantor retains possibility of reverter

Question 14

FS subject to condition subsequent

Answer 14

Present fee that is limited by specific conditional language (upon condition that, provided that, but if, if it happens that)
- Future interest: right of entry

Question 15

A life estate holder’s (life tenant) rights/duties include:

Answer 15

Right to possess, right to collect rent, lease/sell/mortgage, duty not to commit waste, obligation to pay all ordinary taxes on the land

Question 16

Reversion

Answer 16

Held by grantor who transfers LE without conveying the remaining FI to a third party

Question 17

Possibility of Reverter

Answer 17

FI retained by grantor when FSD is conveyed

Question 18

Right of reentry

Answer 18

FI retained by grantor after a FSSCS is granted

Question 19

Remainder

Answer 19

FI that becomes possessory upon the natural expiration of a prior estate that is created in the same conveyance in which the remainder is created

Question 20

If transferee assumes the mortgage, then:

Answer 20

then transferee becomes primarily liable and borrower becomes secondarily liable

*IF borrower makes payments, she can seek reimbursement from transferee

Question 21

In a general warranty deed, what are the present and future covenants?

Answer 21

Present:

(1) Seisin - grantor owns land described in deed
(2) Right to convey - grantor has right to transfer title
(3) Against encumbrances - no undeclared encumbrances against land

Future:

(1) Quiet enjoyment - grantee not disturbed in possession by third party
(2) General warranty - grantor will defend against third party claim
(3) Further assurances - grantor will do whatever future acts reasonably necessary to pass title if later determined title is imperfect

Question 22

What are the requirements of a real covenant?

Answer 22

(1) Writing,
(2) Intent,
(3) touch and concern (benefit or burden must affect promisee/promisor as owners of land),
(4) Notice (for the burden only, must be constructive or actual),
(5) Privity

• Modern trend requires no privity
• A subsequent PURCHASER of property who does not have notice of a burdening covenant is not bound by it if protected by the recording act

Question 23

Equitable servitude

Answer 23

Covenants about land use that are enforced by injunction (no privity required)

(i) writing,
(ii) intent for restriction to be enforceable by and against successors,
(iii) must touch/concern, and
(iv) if the servitude is to be enforced against a purchaser, the purchaser must have notice

Question 24

Pursuant to the statute of frauds, a land sales contract must:

Answer 24

(1) be in writing,
(2) signed by the party to be charged,
(3) and contain all essential terms (parties, property description, terms of price/payment)

Question 25

Part Performance SOF Exception

Answer 25

SOF requirements are excepted if buyer takes possession of land, buyer remits all or part of purchase price, and/or buyer makes substantial improvements (at least two of the three acts must be present)

Question 26

The doctrine of equitable conversion places the risk of loss on:

Answer 26

the buyer unless the jurisdiction follows the UVPRA

Question 27

Easements can be terminated by

Answer 27

Release, merger, severance, abandonment, destruction, prescription, estoppel

Question 28

“No conveyance or mortgage of real property shall be good against subsequent purchasers for for value and without notice unless the same be recorded according to law”

Answer 28

Notice statute

BFP (purchaser for value without notice) of prior interest prevails over prior grantee who failed to record

Question 29

“No conveyance/mortgage of real property good against subsequent BFP unless first recorded by law”

Answer 29

Race-notice statute

Subsequent BFP protected only if he takes without notice and is first to record

Question 30

Implied warranty of fitness or suitability is:

Answer 30

implied with the sale of every new home

Question 31

Equity of Redemption

Answer 31

After default but before foreclosure sale, mortgagor may regain title by paying amount of loan obligation currently owed, plus interest

Question 32

Pre-foreclosure rights in lien and title theory states

Answer 32

Lien Theory - mortgagee cannot take possession before foreclosure

Title Theory - mortgagee theoretically entitled to possession at any time (but typically cannot take possession until default by mortgage terms)

Question 33

Must the owner of collateral subject to a security interest ensure, in good faith, that the value of the security interest does not decrease?

Answer 33

YES

Question 34

An inter vivos transfer by a joint tenant of his property interest:

Answer 34

Severs the joint tenancy, which converts it into a tenancy in common

*If there are more than two joint tenants, then a a severance does not automatically affect the joint tenancy of all joint tenants

Question 35

Once a developer has relinquished control:

Answer 35

the HOA has the power to terminate without penalty any contract or lease between the association and the developer, or an affiliate of the developer

Question 36

A profit is a:

Answer 36

nonpossessory right to enter another’s land and remove specific natural resources

*Analyzed similar to easements and cannot be created by necessity

Question 37

Doctrine of Retaliatory Eviction

Answer 37

LL may not evict a residential tenant as retaliation for the tenant’s reporting a housing code violation to the appropriate authorities OR for refusing to pay rent when the LL breaches the warranty of habitability

Question 38

The hardship for which a variance is sought may not:

Answer 38

be created by the owner who seeks the variance

Question 39

Rule of Convenience

Answer 39

Rule of interpretation which provides that membership in a class closes whenever any member of the class is entitled to immediate possession of a share of the class gift

***DOES NOT APPLY when grantor specifies class should remain open.
EX: "regardless of when born"

Question 40

Recovery on Mortgage W/O Acceleration Clause

Answer 40

Although a mortgagee may bring a foreclosure action whenever a mortgage obligation whenever a mortgage obligation is in default, the mortgagee is only entitled to collect th amount of the obligation that is currently due and owing unless the mortgage contains an acceleration clause

Question 41

Implied Reciprocal Servitude

Answer 41

An implied reciprocal servitude must meet the following requirements to be enforceable:

(i) there must be intent to create a servitude on all real property interests (common scheme),
(ii) the servitude must be negative (a promise to refrain from doing something), and
(iii) the party against whom the enforcement of the servitude is sought must have actual, record, or inquiry notice

Question 42

Generally, zoning ordinance must make provisions for:

Answer 42

property with an existing nonconforming use - can be lost in various ways, including enlargement of the nonconforming use

Question 43

Anti-Lapse Statute prevents:

Answer 43

gifts from lapsing only when those gifts were given to a FAMILY member within a certain statutory degree

Question 44

Although the CL RAP applies to options to purchase real property, it does not apply to:

Answer 44

An option to purchase the property that is held by a CURRENT leasehold tenant

Question 45

Once the location of an express easement is fixed, under the majority rule:

Answer 45

The owner of the servient estate may not unilaterally change the location of the easement

Servient estate: land that is subject to an easement that benefits another parcel (dominant estate is the benefited parcel

Question 46

LL Duty to Mitigate

Answer 46

Under the majority rule, LL who is aware that a tenant has abandoned her leasehold interest is under a duty to mitigate damages by making reasonable efforts to re-rent the premises

*Failure to do so reduces recovery

Question 47

A mortgagor may waive the right to redeem after the mortgage has been executed in exchange for:

Answer 47

good and valuable consideration

Question 48

In order for a property owner who is in the process of building a structure when a zoning ordinance is adopted that prohibits such a structure to convince a court that his right to build has vested:

Answer 48

The owner must have acquired a building permit prior to the date that the zoning ordinance took effect

Question 49

Equity of Redemption

Answer 49

After default but before mortgage sale, mortgagor may regain title by paying amount of loan obligation currently owed, plus interest

• Cannot clog this right through circumventing