Real Property Flashcards
1
Q
What is the hallmark of a concurrent estate
A
right to enjoy and possess the whole
2
Q
What are the three forms of concurrent ownership?
A
Joint tenancy, tenancy by the entirety, and tenancy in common
3
Q
What are the 3 distinguishing characteristics of the joint tenancy?
A
1) Right of survivorship
2) Alienability intervivos
3) Not descendable (w/o will) or devisable (w/ will)
4
Q
What is required to create a joint tenancy?
A
The Four Unities (T-TIP)
T- At the same time
T - by the same title (ie by the same deed will or other doc)
I - identical and equal interests
P - rights to Possess the whole
+ a Clear expression of a right of survivorship (otherwise presumed to be a tenancy in common)
5
Q
Do Tenants in common have to have equal intersts?
A
No (but equal interests are presumed)
6
Q
What are the ways for a joint tenancy to become a tenancy in common?
A
Sale/conveyance - the transferee takes as a tenant in common (but the remaining joint tenants continue in a joint tenancy). But if the joint tenants convey together in equal parts, the joint interests are not severed but the transferee takes as a tenant in common.
Unilateral sale/conveyance severs. Severance happens when the contract of sale is signed (not when legal title passes)
Severance and partition - can be by voluntary agreement, by judicial action calling for partition in kind (physical division if in best interest of all parties - usually when acreage and easily divisible), or by judicial action calling for forced sale (best when not easily divisible like a house)
7
Q
Will a mortgage on a joint tenant’s interest sever the joint tenancy?
A
No (severs only on foreclosure sale - majority lien theory states)
Yes (in title theory states - minority view is that granting mortgage actually transfers the grantor’s title to the mortgagee)
8
Q
One joint tenant kills another, what is the effect?
A
The joint tenant’s joint property becomes a tenancy in common
9
Q
What is a tenancy by the entirety?
A
a martial estate between married spouses who take a fictitious single person with right of survivorship
10
Q
How is a tenancy by the entirety created?
A
In the states that recognize it, it arises presumptively in any conveyance to the married spouses unless the language of the grant clearly indicates otherwise. Clear indication of a joint tenancy means no tenancy by the entirety is created
11
Q
What is the hallmark of the tenancy by the entirety?
A
creditors of one spouse cannot touch this tenancy for satisfaction of a debt, and one spouse acting alone cannot defeat the right of survivorship by unilaterally conveying to a third party, a deed/mortgage executed by one spouse is ineffective
12
Q
When is a tenancy by the entirety severed?
A
1) Death
2) divorce (but not legal separation
3) mutual agreement
4) execution by a joint creditor of both spouses
Transforms into a tenancy in common
13
Q
What is distinctive about the tenancy in common?
A
- No right of survivorship
- Joint grantees are presumed to be tenants in common
- Interests devisable, descendable, and alienable
- Unequal shares are ok
14
Q
What are the damages for an ouster?
A
If one of two concurrent owners ousts the other, the ousted concurrent owner can recover 1/2 of the fair rental value of the property (ie can recover their share of the fair rental value)
15
Q
Do profits from a co-tenant’s personal enjoyment of exclusive possession need to be shared?
A
No (e.g. one co-tenant leaves voluntarily and the other lives there alone)
16
Q
Do profits generated from third parties need to be shared?
A
YEs, a co-tenant who leases all or part of the premises must account to their co-tenants with a fair share of the income
Co-tenants must also share the profits from exploitations of the land such as mining
17
Q
Is it possible for one co-tenant to adversely possess theater?
A
No - because each co-tenant has a right to possess the whole, cannot adversely possess unless their is an ouster
18
Q
What are the co-tenant responsibilities as to the carrying costs of the property? What are carrying costs?
A
carrying costs = taxes and mortgage payments
Must be split according to % ownership
19
Q
What repairs can be split among co-tenants according to their % ownership? What must be done first?
What’s the vocab word here?
A
“right to contribution” for necessary repairs provided that they gave NOTICE to other co-tenants of the need for repairs
20
Q
Must unilateral improvements made by one co-tenant without approval be divided among other co-tenants?
A
No - no right to contribution for unilateral unapproved improvements, but at partition, the party that made the change will have their share increased by any increase in value from the improvements and decreased in value by any decrease in value
21
Q
What are the three types of waste? What types of waste are actionable?
A
Voluntary waste - willful destruction (or “improvement” that decreases value)
Permissive waste - neglect
Ameliorative waste - unilateral change that increase value
All three types are actionable even if there is no decrease in value
22
Q
Can co-tenants limit their right to partition?
A
Yes as long as they are limited to a reasonable time
23
Q
What is a key implication of the duty of fair dealing among co-tenants?
A
if one co-tenant acquires an outstanding title or lien that may affect the estate, the acquisition is deemed to be for the benefit of all other co-tenants as well
24
Q
What interest does the landlord have when a leasehold estate has been given?
A
a reversion
25
What are the 4 types of leasehold estates?
What is another term for non leasehold estate?
1) tenancy for years
2) periodic tenancy
3) Tenancy at will
4) tenancy at sufferance
Nonfreehold estate
26
How can you identify a tenancy for years?
Spot the end date of the lease (could be short or long term)
27
What kind of notice is needed to terminate a tenancy for years?
None - tenancy terminates automatically at the end of the lease
28
What is a right of reentry?
If a lease covenant is broken by the tenant, it allows the landlord to terminate the lease
failure to pay rent is breaking a lease covenant (and a right of reentry is often implied for failure to pay rent, even if it is not provided for in the lease)
29
I'm drafting a tenancy for years lease for a one year lease, what do I need to remember?
Leases of GREATER THAN ONE YEAR must be in writing (SOF Compliant)
30
What is a hallmark of a periodic tenancy?
It renews automatically at set intervals until either landlord or tenant gives notice of termination
31
How can you create a periodic tenancy?
1) Expressly ("month to month" type language)
2) By Implication/Operation of Law either by
A) no mention of duration but rent paid at intervals
B) Oral term of years in violation of SOF with periodic rent payments
C) in a residential lease when the landlord elects to holdover (by accepting rent) a tenant who has stayed past the end of the original lease (implied periodic tenancy based on frequency of rent payments)
32
How much notice must be given to terminate a periodic tenancy?
At common law at least the length of one period unless otherwise agreed, and notice must be timed to terminate the lease at the end of a period
BUT for leases where the period is one year
under common law 6 mo notice required
under the restatement one month of notice is required (bar exam follow Rst)
33
What is the hallmark of a tenancy at will?
no fixed period or term - lasts until either landlord or tenant terminates
34
How is a tenancy at will created?
usually must be express ("to T for as long as L or T desires")
Absent express agreement, if there is a periodic payment of rent, a periodic tenancy will be created
If the lease only gives the landlord the right to terminate, a similar right will be implied for the tenant. (but reverse does not apply to benefit the landlord)
35
How can you terminate a tenancy at will?
Either party can end (but most states require notice and a reasonable time to "quit" (ie vacate))
Can also be terminated by operation of law (if death of one party or commission of waste)
36
How is a tenancy at sufferance created?
when a tenant wrongfully holds over (ie they assert possession past the expiration of their lease)
A tenancy at sufferance is given to this tenant so that the landlord can recover rent for the period of the holdover
37
How does a tenancy at sufferance end?
If the landlord accepts rent, then a periodic tenancy is created by implication.
If the landlord evicts the tenant, that also works
38
What are the landlord's two options in dealing with a holdover tenant?
1) Evict the tenant
2) bind the tenant to a new periodic tenancy (the various promises in the original lease become part of the new tenancy for the additional term.)
If RESIDENTIAL tenant: usually month to month regardless of original lease term
If COMMERCIAL tenant: can be held to a new year to year periodic tenancy if the original lease term was for one year or more. If the original term was < 1 year, it's usually a month to month
39
Can a landlord increase the rent on a holdover tenant?
If the landlord notifies the tenant BEFORE the lease expires that occupancy after termination will be at an increased rent, then a holdover tenant is deemed to have agreed to the increased rent
40
What are some exceptions to the holdover doctrine where the landlord cannot bind the tenant to a new tenancy?
1) if the tenant remains in possession only for a few hours or only leaves a few articles of personal property OR
2) the delay is not the tenants fault (e.g. severe illness)
41
What is the common law rule about the covenants in leases?
What is the modern rule?
They were independent of each other (if one party breached by failing to pay rent or repair) then the other party could recover damages but obligations persisted
LL can terminate for nonpayment of rent and T can terminate for breach of covenant of quiet enjoyment or implied warranty of habitability
42
What are the three things to know about options to purchase attached to leases?
1) as long as option is contained in the lease, the consideration for the lease supports the option
2) if the option is silent as to duration, the option lasts for the duration of the lease
3) RAP does not apply to options attached to leases (but does apply to options generally)
43
What are the tenants 3 main duties?
Repair, not commit waste, and pay rent
44
What is the tenant's duty to repair when the lease is silent?
T must maintain the premises by making routine repairs. Does not have to fix ordinary wear and tear
45
What is the tenant's duty not to commit waste? What are the 3 types of waste?
```
Voluntary Waste (overt deliberate destruction)
Permissive Waste (when tenant fails to take reasonable steps to protect premises from damage)
Ameliorative Waste (if T unilaterally alters the property, T is liable for cost to restore it to original condition even if the changes increased value - modern exception if T is long term, value does not decrease, and change reflects substantial and changes in the neighborhood that deprives the property of its original use)
```
46
What is the tenants duty to repair when there is an express covenant in the lease imposing the duty to repair on T?
Destruction of property and generally
If Property destroyed, at common law, T was responsible for the loss even if not at fault. Under majority view, tenant may end the lease if premises destroyed without T's fault
If residential -> LL still obligated to repair under nonwaivable implied warranty of habitability
if nonresidential -> T obligated to repair including ordinary wear and tear (absent typical contractual modification)
47
What are LL's options if T refuses to pay rent and retains possession?
evict (still entitled to rent due)
continue the relationship and sue for rent due
Self help is a bad idea (civil and criminal liability)
48
What are LL's options if T refuses to pay rent and is no longer in possession?
SIR
LL can treat as implicit offer of SURRENDER which if LL accepts, ends the lease
IGNORE the abandonment and continue to charge rent (few states allow this)
RE-LET the premises on the vacating tenant's behalf and hold them liable for any deficiency
Under the majority rule, LL must at least try to relet
49
What are the typical restrictions on security deposits
1) usually limited to one month's rent
2) usually require LL to pay interest on the deposit
3) usually allow statutory or punitive damages for improper refusal to return a security deposit
50
What happens to a LL-T relationship if the entire leasehold is taken by eminent domain (ie condemned)
What if only part is condemned?
If fully condemned -> T's liability for rent is extinguished and lessee is entitled to compensation
If taking is temporary or partial-> tenant must continue to pay rent but is entitled to compensation from the taking
51
Tenant is using the premises for illegal purposes, what can LL do?
terminate the lease or obtain damages and injunctive relief
52
What are the landlord's 3 main obligations?
1) Duty to deliver possession
2) Implied covenant of quiet enjoyment
3) Implied warranty of habitability
53
What happens if there is still a holdover tenant when LL is supposed to deliver possession to a new tenant?
the LL has breach the duty to deliver possession and T is entitled to damages
54
When does the implied covenant of quiet enjoyment apply? What does it provide?
It is implied into every residential and commercial lease
Provides the right to use the premises without interference from the landlord or a paramount title holder (e.g. a prior mortgagee that forecloses)
55
What are the two ways that a LL can breach the covenant of quiet enjoyment by wrongful eviction?
Can be actual or constructive eviction, as for actual eviction...
1) actual eviction (LL/paramount title holder/holdover tenant excluding tenant from the entire leased premises - terminates the obligation to pay rent)
2) partial eviction (excluded from part of the premises - if by the LL, then relieves T of obligation to pay any rent - if by paramount title holder then relieves T of obligation to pay rent for part of the premises)
56
How can LL breach the covenant of quiet enjoyment by constructive eviction?
What's the remedy
Constructive eviction is when landlord'd breach of duty renders the premises unsuitable for occupancy
SING
Substantial Interference (by LL's actions or failures or LL's agent)
Notice (of the problem given to LL and fail to fix)
Goodbye (vacate)
Terminate the lease and seek damages
57
Is the LL responsible under the implied covenant of quiet enjoyment for the actions of other tenants?
Generally No BUT
- LL must abate a nuisance on the site
- LL must control the common areas
58
When does the implied warranty of habitability apply?
What is provided?
That's the key difference from constructive eviction
Most jurisdiction imply it not residential leases (NOT commercial) and it is not waivable.
Provides that the premises be fit for basic human habitation (standard set by case law and housing code)
There is no requirement to move out for breach of implied warranty of habitability, but must move out to claim constructive eviction!
59
What can T do when the implied warranty of habitability is breached?
T can pick one of MR3
Move out and terminate lease
Repair and deduct
Reduce rent or withhold all rent until the court determines a fair rental value (place in escrow to show good faith)
Remain in possession, pay full rent, and affirmatively seek damages
60
What is a retaliatory eviction?
LL may not terminate a lease or otherwise penalize a tenant for tenant's exercise of their legal rights (e.g. reporting housing code violation).
Rebuttable presumption of retaliatory motive if landlord acts within 90-180 days of tenant exercising their rights
61
What are the two main anti-discrimination statutes for housing?
Civil Rights Act (bar racial and ethnic discrimination in the sale or rental of all property)
Fair Housing Act (protects tenants and potential tenants from discrimination baed on race, color, religion, national origin, sex, disability as well as familial status)
62
What are the two key exceptions from the fair housing act?
1) owner occupied buildings with four or fewer units in which persons live independently of each other
2) single family homes sold or rented by an owner who owns no more than three single family homes
63
What is the fair housing act's regulation of advertising?
FHA prevents making, printing, or publishing any notice or ad that indicates a preference or limitation base don a protected category. Applies to both the advertiser and the publisher - the exemptions for owner occupied and single family do not apply
64
What is required for disabled tenants under the fair housing act?
Must permit disabled tenants to make reasonable modifications to their premises and make reasonable accommodations to their rules, policies, and services to afford the disabled person an equal opportunity to use the dwelling
65
What is the difference in an assignment and an sublease?
```
Assignment = T transfers entire remaining term
Sublease = T transfers part of the remaining term
```
66
Can a landlord prohibit assignment or subleasing?
How are these clauses construed?
Yes, can require prior written approval, but consent to one transfer is considered as a waiver of future right to approve unless the landlord expressly reserves that right.
If LL was aware of assignment and did not objection (e.g. by accepting rent from assignee), approval deemed waived
Prohibitions on one of either assignment or subleasing are not construed to apply to the other
67
What is the legal relationship created by assignment?
Assignee stands in the shoes of the original Tenant. In privity of estate with LL and each is liable for the covenants in the lease that run with the land. Not in privity of contract. Assignee owes rent DIRECTLY to LL.
Assignor is no longer in privity of estate with LL but is still in privity of contract and is bound by it. Assignor still secondarily obligated to pay rent (or for any other covenant violation).
Need either privity of contract or privity of estate to enforce a covenant against someone
68
Can a tenant assign a tenancy at will?
No - attempted assignment of a tenancy at will will terminate the tenancy at will by operation of law
69
When does a covenant run with the land [LL/Tenant context]?
What are the implications of this for assignees/sublessees paying rent
If the original parties so intend and the covenant touches and concerns the land
Assignee owes rent DIRECTLY to LL. Sublessee does not (must go through sublessor)
70
What is the legal relationship created by a sublease?
Sublessee pays rent to sublessor who then pays to LL
LL and subleasee are neither in privity of contract or privity of estate.Sublessee is not liable to LL for any of the covenants (inc rent) unless sublessee expressly assumes the covenants.
LL and sublessor relationship remains fully in tact
71
What happens to a sublease if the LL terminates the main lease (for nonpayment of rent or otherwise)?
sublease terminates automatically
72
Can a subleasee enforce covenants made by the LL in the main lease?
Generally no except a residential subleasee may be able to enforce the implied warranty of habitability against the landlord
73
What happens if a tenant assigns or sublets in violation of a lease provision?
LL may terminate the lease or sue for damages but the transfer is not void
74
Is tenant's consent required for LL to assign their rents or reversion interest?
How is such an assignment done?
No - tenant consent not required
LL usually assigns as part of the deed when LL conveys a building to a new owner
75
If LL assigns to buyer, what rights does buyer have against tenant?
Once tenants are given notice, they must recognize and pay rent to the new owner as their LL. Benefit of all tenant covenants (inc rent) run with the land to Buyer
76
If LL assigns to buyer, what is buyer's liability to tenants?
What is LL's continued liability
Buyer is liable to tenant for the performance of all covenants that run with the land. (privity of estate)
LL remains liable for all of the covenants that they made in the lease (privity of contract)
77
Is the landlord under any duty to make premises safe?
```
Under common law: No - caveat leasee, but there are 5 exceptions:
CLAPS
Common areas
Latent defects
Assumption of Repairs
Public use rule
Short-term lease of furnished dwelling
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Under modern rule, LL owes a duty of reasonable care towards residential tenants and is liable in tort for injuries from ordinary negligence if the LL had notice of a defect and an opportunity to repair
78
What are the details of the latent defects exception to caveat leasee
LL must warn of latent defects that LL knows or should have known otherwise LL will be liable for resulting injuries. If T is warned and accepts premises anyway LL is off the hook + no duty to repair
79
What are the details of the assumption of repairs exception to caveat leasee?
LL is under no duty to repair under tort law, but once repairs are undertaken, LL must complete them with reasonable care
80
What are the details of the public use exception to caveat leasee?
IF (1) a LL leases a public space (e.g. convention hall or museum) and (2)should know because of the significant nature of the defect and the short length of the lease that the tenant will not repair
THEN LL is liable for any defects on the premises that cause injury to members of the public
81
What are the details of the short term lease of a furnished dwelling exception to caveat leasee?
LL who rents a fully furnished premises for a short period (like a summer cottage) is responsible for ANY defective condition that proximately injures a tenant (regardless if they knew of the defect)
82
What is the modern rule's approach to LL tort liability for defects arising after tenant takes possession?
LL held to have notice of defects existing before the tenant took possession, but is not liable in tort for defects arising after T takes possession unless LL knew or should have known of them
83
What is the modern rule's approach to LL tort liability if LL has a statutory duty to repair?
if LL has a statutory duty to repair and does not, then LL is liable in tort for injuries resulting from failure to repair or negligence in making repair
84
What is the modern rule's approach to LL tort liability, what is LL's responsibility for security?
If LL failed to comply with housing code provisions dealing with security, maintain ordinary security measures or provide advertised security measures, then LL lis liable in tort for criminal acts of third parties
85
What is a fixture?
A fixture is chattel that is so affixed to the land that it has ceased being personal property and becomes part of the realty. A fixture passes with the ownership of the land.
Chattel is fixture when it is either:
1) so incorporated into the realty that it loses its identity
2) affixed to the realty such that its removal would cause considerable damage to the premises
86
What is a common ownership case (fixtures context)
Person who brings the chattel to the land owns the chattel and the realty.
Property becomes a fixture if the owner intended it. Intent is judged by: 1) nature of the article 2) manner of attachment 3) amount of damage that would be caused by its removal 4) adaptation of the item to the use of the realty
87
What is a divided ownership case (fixtures context).
What is the key vocabulary word here?
What is the trade fixtures doctrine?
What are the implications in the LL-T context and life tenant and remainder man context?
What about licensee case? Trespasser case?
chattel is owned and brought by someone other than the owner of the realty.
Accession describes the annex's intent to make the chattel a permanent part of the realty (including all structural additions)
Trade Fixtures Doctrine says Commercial tenants can remove all trade fixtures before the expiration of the lease
Agreement between landlord and tenant controls on determination of if something is a fixture. Absent an agreement, T is deemed to lack intent to annex and can remove unless removal would substantially damage the premises or destroy the chattel. Annexed chattel must be removed by the end of the lease otherwise the tenant is responsible for the cost of restoring to original condition
Same rules apply for life tenant and remainderman and licensees
Trespassers normally lose their annexations but some courts allow a good faith trespasser to recover the value added to the realty (not construction costs)
88
What is an easement
a grant of a nonpossessory property interest that entitles its holder to some form of use or enjoyment of another's land
89
What is the presumed duration of an easement?
Perpetual (unless the grant specifically limits the interest
90
What are the two types of easement?
Affirmative (most common) - right to go on to another's land and do something
Negative (limited to certain circumstances) - entitles the holder to prevent the servient landowner from doing something that would otherwise be permissible
91
What are the 4 types of permissible negative easements?
LASS
Light, Air, Support, Stream water from artificial flow
Minority of states allow negative easements for scenic view
92
How can you create a negative easement?
Only expressly in a writing signed by the grantor - not natural or automatic right to a negative easement
93
What are the two different relationships between burdened and benefitted in easement context?
Appurtenant - benefits the holder in use/enjoyment of land (need two parcels - dominant and servient)
In Gross - confers benefit to a holder for a personal or pecuniary advantage unrelated to use of land (only servient parcel)
94
What are common types of easements in gross?
Right to place a billboard on another's lot, right to swim in another's pond, utility company's right to lay power lines
95
When does the benefit of an easement appurtenant pass on with transfer of the dominant tenement?
Can the easement be transferred separately from the land?
automatically - REGARDLESS if it is mentioned in the conveyance
No - unless it is a conveyance to the owner of the servient tenement to extinguish the easement. An attempted transfer fails but does not terminate the easement
96
When does the burden of an easement appurtenant pass on with transfer of the servient tenement?
automatically - UNLESS the new owner is a BFP without notice of the easement
97
When is the benefit of an easement in gross transferrable?
Only for commercial purposes
e.g. if easement in gross to swim in pond, that easement can't be transferred because it's for pleasure not commercial use
98
What are the 4 methods of creating an easement?
```
PINGE
Prescription
Implication
Necessity
Grant
Express Reservation
```
99
What is required to create an easement by grant?
must be in writing signed by the holder of the servient tenement unless its term is <1 year (removing it from SOF)
*the writing must also comply with all of the requirements of a deed* (the writing is actually called a deed of easement)
100
What are the methods of creating an easement by implication?
Created by operation of law (so exception from SoF)
Can be implied from preexisting use or without any listing use
101
What is required to create an easement by implication from preexisting use?
This is called a "quasi-easement"
2 Elements:
1) the previous use on the servient part was apparent and continuous AND
2) the parties expected that the use would survive division because it is reasonably necessary to the dominant tenement's use and enjoyment
102
What is required to create an easement by implication without preexisting use?
2 Routes
Route 1: Subdivision Plat
When lots sold in a subdivision with reference to a plat or map showing streets leading to lots, buyers of those lots have implied easements to use the streets to access their lots
Route 2: Profit a Pendre
Holder of a profit a prendre has an implied easement to pass over servient land to use it to extract the products under the profit
103
What is required to create an easement by necessity?
Landowner conveys a portion of their land with no way out except over some part of the grantor's remaining land - owner of the servient parcel has the right to locate the easement
104
What is required to create an easement by prescription?
COAH
Continuous and uninterrupted use for the statutory period
Open and notorious
Actual use (need not be exclusive)
Hostile (w/o servient owner's permission)
*generally cannot be acquired over public land
105
What is required to create an easement by express reservation?
An easement by reservation arises when a grantor conveys title to land by reserves the right to continue to use the tract for a special purpose - Grantor can ONLY RESERVE AN EASEMENT FOR THEMSELVES (not for a third party) an attempt to reserve for a third party is void
106
What determines the scope of an easement?
The terms of the grant or the conditions that created it.
if no terms in the grant, then courts assume the easement is intended to meet present and future needs, but if the dominant parcel is subdivided (or additional abutting/adjacent tracts that are folded in), owners will not succeed to the easement if that would unreasonably burden the servient estate. (if overburden, then the remedy is an injunction against overuse, not termination of the easement)
107
Who bears the cost of making repairs to an easement?
If the dominant parcel is the only one to use the easement, then the dominant parcel must pay alll repairs, but if both dominant and servient parcel use the easement, then they apportion the costs
108
What are the eight ways of terminating an easement
```
END CRAMPS
Estoppel
Necessity
Destruction
Condemnation
Release
Abandonment
Merger
Prescription
Stated Conditions
```
109
How does an easement terminate under stated conditions?
Not all easements are perpetual, it may terminate under its own terms
110
How does an easement terminate under Estoppel?
An oral expression of intent is usually ineffective (because SOF), but of servient owner materially changes position in reasonable reliance on easement holder's assurances/representations, the easement terminates through estoppel
111
How does an easement terminate under Necessity?
Easements created by necessity disappear when the necessity disappears UNLESS the easement was reduced to an express easement
112
How does an easement terminate under Destruction?
Destruction of the SERVIENT land (other than through willful conduct of the servient owner) terminates the easement
113
How does an easement terminate under Condemnation?
Condemnation of the SERVIENT land by govt eminent domain will terminate the easement - courts are split as to if the easement holders are entitled to compensation
114
How does an easement terminate under Release?
A release given by the easement holder to the servient landowner is effective IF IN WRITING (SOF Compliant)(works for appurtenant or in gross easements)
115
How does an easement terminate under Abandonment?
There must be PHYSICAL ACTION indicating an intent to never use the easement again (like building a fence) - mere non use or verbal indication of intent to abandon is not enough
116
How does an easement terminate under Merger?
if the title to the easement and the servient estate are owned by the same person, the easement disappears - to recreate, must start from scratch
117
How does an easement terminate under Prescription?
Must meet the elements of adverse possession (COAH)
Continuous interference for the statutory period
Open and notorious
Actual
Hostile
118
Who owns a common wall or driveway?
What are each party's obligations with regard to the wall/driveway
Whoevers land it sits on, but there are cross easements of support such that both parties can use it and neither party can unilaterally destroy it
Each agrees to be mutually responsible for maintaining the wall/driveway and the benefits and burdens of the original promise run with the land as covenants
119
Are common walls and driveways subject to SOF?
Yes, to create an express party wall or driveway agreement, SOF must be satisfied, BUT an irrevocable license can result of there is detrimental reliance on an oral agreement.
Party walls and driveways can also result form implication or prescription
120
What is a license?
privilege to enter another's land for some purpose - (unlike an easement) it is not an interest in land - removable at will and unalienable
121
What happens if you try to transfer a license?
The license is revoked by operation of law
122
Is a writing needed to create a license?
No because it is not an interest in land, so SOF does not apply
123
What happens if an attempted creation of an easement fails due to SOF?
A license is created
124
When can a license be revoked?
What are some instances of irrevocable licenses?
At will unless estoppel applies
(the classic cases are tickets and neighbors talking by the fence attempting to create an oral easement)
license can be revoked even if you gave value for it
Irrevocable license exists so that a buyer of chattel can enter the property to remove the chattel or a future interest holder can enter to inspect for waste
125
When does estoppel apply to prevent the revocation of a license? What exists if estoppel applies?
When the licensee has invested substantial money, labor or both in reasonable reliance on the license's continuation
- the result is an easement by estoppel which lasts until the holder receives sufficient benefit to reimburse him for his expeditures
126
What are the rules for creating and terminating profits?
The same as the rules for easements (can be a profit in gross or a profit appurtenant)
But a profit can also be terminated by surcharge which is when the holder of the profit misuses the profit and overly burdens the servient estate
127
What is a covenant?
A written (contractual) promise to do or not to do something related to the land
128
Contrast a covenant with an easement
covenants are not a grant of a property interest, covenants are contractual limitations or promises with regard to property
129
Where are real covenants usually found?
in deeds
130
what are the two types of covenant?
Negative (ie restrictive - promise to refrain from doing something) and
Affirmative (a promise to do something related to the land)
131
How do you know if a covenant analysis or an equitable servitude analysis should apply to a given set of facts?
They are similar, but if plaintiff wants money damages, they need a covenant
If plaintiff wants an injunction, they need an equitable servitude
132
What is the important to ask with covenants?
Determining if the covenant runs with the land (ie can the covenant bind successors)
133
What are the two levels of analysis for determining if a covenant runs with the land?
the burdened side and the benefitted side (both must run for the covenant to be forcable) - analyze the burden side first because that is the more difficult one to meet
134
What are the requirements for the burden of a covenant to run with the land?
IF the following are met, the burdened estate will be bound by the covenant as if they themselves had agreed to it (WITHVN)
Writing
Intent
Touch and Concern
Horizontal Privity
Vertical Privity
Notice (if required by the recording act)
135
Describe the Writing requirement for a benefit/burden of a covenant to run with the land.
The original promise between the original covenanting parties must be in writing (must be SOF Compliant)
136
Describe the Intent requirement for a benefit/burden of a covenant to run with the land.
The original covenanting parties must have intended that the covenant would run with the land. Intent can be inferred from the circumstances but is usually present in the conveyance itself (courts are generous in finding intent)
137
Describe the Touch and Concern requirement for a benefit/burden of a covenant to run with the land.
The covenant must affect the parties legal relations as landowners and not simply as members of the community at large
Covenants to pay HOA fees and covenants not to compete do touch and concern the land
138
Describe the Horizontal Privity requirement for a burden of a covenant to run with the land.
Horizontal privity nexus between the original promising parties and requires that they be in "succession of estate" meaning that they were in a grantor-grantee, landlord tenant, or mortgagor-mortgagee relationship when the covenant was created
139
Describe the Vertical Privity requirement for a benefit/burden of a covenant to run with the land.
There must be some non hostile nexus (e.g. contract, devise, descent) between the successor in interest and the covenantor.
The grantee must have received the entire durational estate that the covenanting party had to give (If LL owns in fee simple, a tenant is not bound)
140
Describe the Notice requirement for a burden of a covenant to run with the land.
The successor must have had notice of the covenant when he took. Could be actual, inquiry or record notice
This is because under modern recording acts a subsequent purchaser for value takes free of covenants if no notice
If covenant was recorded further up the chain of title, buyer is on notice of it
141
What are the requirements for a the benefit of a covenant to run with the land?
```
WITV
Writing (SOF Compliant)
Intent
Touch and Concern
Vertical Privity
```
142
How can a covenant be terminated?
same methods as easements ENDCRAMPS
(plus can become unenforceable if the WITHVN/WITV elements are lacking such that the burden/benefit does not run with the land)
143
What is an equitable servitude?
a promise that equity will enforce against successors of the burdened land regardless of whether it runs with the land at law unless the successor is a BFP for value and without notice
144
What is required to create an enforceable equitable servitude?
WITNES
Writing (usually but not always b/c common scheme doctrine exception)
Intent
Touch and Concern
Notice (if required by the recording act)
= Equitable Servitude
145
What is unique about the notice requirement for an enforceable equitable servitude?
the notice requirement for an enforceable equitable servitude requires actual, inquiry, or record notice APART from the recording acts
(in most states) No notice required if the successor to the burdened land is not a purchaser (ie no notice required if donee, adverse possessor)
146
What is the implied equitable servitude or the common scheme doctrine?
Allows an equitable servitude to be enforceable even without a writing but ITN of WITNES still apply (need intent, touch and concern and notice
147
What is another name for an implied equitable servitude?
Recriprocal negative servitude
148
What are the elements of the common scheme doctrine?
#1: When sales began the subdivider had a general scheme of residential development which included D's lot. The scheme may be evidenced by a recorded plat, a general pattern of restrictions or oral representation to early buyers
#2: D had notice of the promise contained in those prior deeds when it took (if D took before the common scheme emerged, there is no common scheme doctrine)
149
What are equitable defenses to an equitable servitude?
1) CHANGED CONDITIONS (so significant that the enforcement would be inequitable - limited pockets of change not good enough)
2) The person seeking enforcement is violating a similar restriction on their own land (UNCLEAN HANDS)
3) A benefitted party ACQUIESCED in the violation of the servitude
4) The benefitted party acted in a way that a reasonable person in the burdened party's position would believe that the covenant was abandoned or waived (ESTOPPEL)
5) LACHES
150
How can an equitable servitude be terminated?
Via the normal ENDCRAMPS methods applicable to easements/covenants
151
How does title by adverse possession work?
Title is acquired when the SOL for ejectment expires
152
What are the elements of Adverse Possession?
CONAEH
```
Continuous
Open
Notorious
Actual
Exclusive
Hostile for the Statutory period
```
153
Describe the continuous element of adverse possession
To be continuous, the occupancy can't be intermittent but also does not have to be constant - only has to be of a type that a usual owner would make
154
When is possession Open and Notorious for adverse possession?
Must be sufficiently apparent to put the true power on notice that a trespass is occurring
155
What does actual exclusive possession mean?
the adverse possessor must actually possess at least some part of the land. Color of title allows adverse possessor to constructively possess the entire parcel as long as she is in actual possession of a reasonable portion of the parcel. But the parcel must be UNITARY - dividedness messes it up
Exclusive possession means cannot share possession with the true owner or the public (two or more people could adversely possess together and take as tenants in common)
156
What does it mean for adverse possession to be hostile?
Adverse possessor must ENTER without the true owner's permission. Grantors and tenants staying on land post conveyance are presumed to be there with permission
157
What is a claim of right in the context of adverse possession?
when someone assumes possession with that they mistakenly believe is a valid title - that possession is considered to be hostile and adverse (claim of right is basically the same thing as hostility)
158
when does the SOL on ejectment (adv period) begin to run?
When the true owner can first bring a suit. Filing a suit will nonstop the period from running - the suit must be pursued to judgment
159
When can adverse possessors tack each other's holding periods?
as long as there is privity between them (any non-hostile nexus, could be conveyance, devise, descent)
160
Does a disability of the true owner toll the SOL for ejectment (Adv poss period)?
Only if the true owner is disabled at the inception of the adverse possession. Disability includes insanity, minority, medical incapacity.
If a minor inherits property's the adv poss period continues to run (as long as minor did not have a future interest - if future interest, then SOL begins to run only once the future interests becomes possessory.)
161
When does the SOL begin to run against future interest holders?
When the future interest becomes possessory
162
Does an adverse possessor take land subject to covenants in the true owner's deed?
If the adverse possessor has been using consistently with the covenant, then yes
If the adverse possessor has been using inconsistently with the covenant, then no - EVEN IF the adverse possessor had notice of the covenant
163
What are the two phases in conveying real estate?
If A contracts to sell and B to buy Blackacre and during the escrow period, A or B dies, what can the other force?
1) the land contract which conveys equitable title
~ Escrow period~
2) the closing when legal title passes
They can each force specific performance. And if the deceased party devised their real and personal property to different people, the shares are calculated as if the $ was paid and property received at the moment of contracting.
So if buyer dies, the taker of the buyer's real property can compel the taker of the personal property to pay for the property out of their share of the estate
164
What rules apply to each phase in the conveying process?
Contract rules apply in the escrow period
Post close (absent fraud) only the deed (and real property rules) apply
165
What are the elements required by the SOF on a land sale contract?
1) Signature of the party sought to be bound
2) identify the parties
3) describe the property
4) include the price (or a means of determining the price
166
What is the result of the parties contract for the purchase and sale of a piece of property and they overestimate the size of the property?
The purchaser can seek specific performance with a pro rata reduction in price.
Remember, all land is unique, so the preferred remedy for breach of a land contract is specific performance
167
When can a land sale contract still be enforcable without an SOF compliant writing?
If the oral contract is certain and clear and there is partial performance.
Partial performance requires 2 of the following 3:
1) Possession
2) Payment (in part or full)
3) Substantial improvements
168
The right of possession rests with the party that holds (equitable or legal) title.
The risk of loss rests with the party that holds (equitable or legal) title.
Legal
Equitable
169
If a piece of real property is destroyed after the contract is signed and before the closing (in the escrow period), who bears the risk of loss?
The buyer unless the contract specifies otherwise
BUT even though the risk of loss is on the buyer, the seller must credit any fire or casualty insurance proceeds they receive against the purchase price the buyer is required to pay
170
What happens if a buyer or seller dies after the signing of the contract and before the closing (in the escrow period)?
The buyer is deemed to own the property (as of the moment of signing) and seller has a right to the purchase price (as of the moment of signing).
Contract remains enforceable and the buyer's estate has the interest in real property and seller's estate has interest in the proceeds as personal property
171
What are the two promises implied in every land sale contract?
1) Seller will provide marketable title
| 2) Seller will not make false statements of material fact
172
What is marketable title?
title reasonably free from doubt and the threat of litigation.
Common Defects that render title unmarketable include:
- Defects in the chain of title (e.g. adverse possession)
- Encumberaces (mortgages, liens, easements, covenants)
- Zoning violations
173
One square inch of a property rests on adverse possession - is the title marketable?
No - for title to be marketable, seller must provide GOOD RECORD TITLE
174
What kinds of encumberances render title unmarketable?
mortgages, liens, restrictive covenants, easements, options to purchase and significant encroachments.
If an encroachment is very slight (inches) and doesn't inconvenience the owner, the encroachment wont render title unmarketable
Known/beneficial or visible easements won't render title unmarketable
175
A buyer sees that the seller has a mortgage/lis penden/tax lien on the property that the seller plans to satisfy with the sale proceeds. Is this unmarketable title and a violation of the covenant to provide marketable title?
No. Seller has a right to satisfy any encumberance using the proceeds of a sale and this does not prevent seller from conveying marketable title
176
There is a tiny zoning violation on the property - does this render title unmarketable?
Yes. Zoning restrictions don't affect marketability of title but zoning violations do
177
Does a future interest held by an unborn or unascertained claimant, does that affect the ability to convey marketable title?
Yes - those kinds of future interests makes it impossible to convey marketable title
178
At what point in the conveyancing process must title be marketable?
On the day of closing (seller has until then to resolve any problems). As long as time is not of the essence, the buyer has to give the seller a reasonable amount of time to cure the defects. One month of delay is usually reasonable.
179
180
What is the buyer's remedy if title is not marketable?
Buyer must notify seller that title is not marketable and give the seller time to cure.
If seller fails to cure, buyer can seek rescission, damages, specific performance with abatement, and a quiet title suit
BUT IF CLOSING OCCURS, buyer can only look to the warranties in the deed and not the implied covenant of marketable title
181
Do the implied covenant of marketable title and the implied duty not to make false statements survive the deed?
No, but the implied promise not to make false statements survives the deed if the seller...
1) made a knowing false statement of material fact that the buyer relied on,
2) actively concealed the defect or
3) failed to disclose known defects on the property
182
When is a seller liable for breach of the implied promise not to make false statements of material fact?
Need all of:
1) Seller must know or have reason to know of the defect
2) seller must realize that the buyer is unlikely to discover the defect and
3) defect must be serious enough that the buyer would probably reconsider the purchase
183
Can seller avoid liability for false statements of material fact with disclaimers like "as is" or "with all faults"?
No, but if the disclaimer identifies a particular kind of defect (seller is not liable for any defects in the roof) then it will likely be upheld
184
Is there an implied warranty of habitability or fitness in real estate transactions?
No. Caveat emptor is the norm (with the exception of new home construction where there is a warranty of fitness or quality. Can also sue the builder for negligence perhaps even if builder is not seller)
185
Is time of the essence in real estate contracts? What's the effect?
Presumed no. a party that is late in tendering their own performance can still enforce the contract if they tender their performance within a reasonable time after the closing date (e.g. 2 months). Still liable for incidential losses if late though.
But presumption is overcome if the contract states, circumstances indicate the parties intent for time to be of the essence, or one party gives the other notice that time is of the essence
186
What is the order for the tendering of seller and buyer's performances in a real estate contract?
concurrent conditions, so neither party is in breach until the other tenders performance
187
When is a party to a real estate contract's duty to perform excused?
IF the other party has repudiated or it is impossinle for the other party to perform (e.g. unmarketable title can't be cured)
188
What are the remedies for breach of a real estate sales contract?
nonbreaching party entitled to either:
1. Damages (contract price - market value plus incidential costs) OR
2. Specific performance OR
3. liquidated damages (earnest money - very common)
189
What can a buyer get if they wish to proceed with a contract despite unmarketable title?
specific performance with an abatement of the purchase price
190
What is the role of a real estate broker?
Seller's agent (but should disclose material information about the property if they have actual knowledge of it)
191
What is an exclusive listing agreement?
| What is a right to sell agreement?
Exclusive listing agreement is an exchange of the broker's best efforts for the commission. Commission might be collectible even if another agent sells the property.
A right to sell agreement precludes a seller from selling the property themselves without paying the commission
192
What is title insurance?
What's the difference in an owners policy and a lender's policy?
Insures that good record title of the property exists as of the policy's date and promises to defend the record title if litigated.
An owner's policy protects only the person who owns the policy (either the owner of the property or a lender) and does not run with the land to subsequent purchasers.
A lender's policy follows any subsequent assignment of the mortgage loan
193
What happens at closing?
The contract "merges" with the deed and disappears. Deed becomes the controlling document and the buyer becomes the legal owner of the house and has right of possession.
194
What elements are required in a valid deed?
LEAD = Lawfully executed and delivered
Lawful execution requires:
1) writing signed by the grantor
2) unambiguous description of the land
3) identification of the parties by name or description
4) Words of intent to transfer
(no need to recite consideration and consideration is not required to make a deed valid)
195
What happens if the description of land in the deed is not sufficient to provide a "good lead"?
What happens if there is a discrepancy between the physical description and the acreage number in the land being conveyed - Deed implications and contract implications
If only ambiguous, can use parole evidence to clear it up
But if still too uncertain, grantor retains title because the deed fails.
Deed Implications: The physical description trumps the number, but reformation is granted if there is mutual mistake or unilateral mistake and misrep is involved. If the parties are bargaining based on the physical description and not the number, no reformation.
Contract Implications: If the contract overstates the acreage, can get specific perf with pro rata reduction in price
196
What is the effect if a deed is delivered with the name of the grantee bank?
What is the effect if the deed is delivered and the land description is left blank?
Court presumes the person taking delivery has authority to fill it in, so if the person fills in a name, the deed is valid.
Deed is void unless the grantee was explicitly given authority to fill in the description
197
What is needed to effectuate the "delivery" requirement of executing a deed?
Delivery turns on grantor's intent that title pass immediately (even if possession is postponed). Delivery could be satisfied by physical delivery by any means or without physical delivery if there is other indication of present intent (rebuttable presumptions at work and all extrensic evidence permitted)
198
What happens if the transferee of a deed rejects the deed?
The delivery requirement fails and the deed does not pass title. Acceptance is presumed so the transferee needs to reject expressly
199
What are the rebuttable presumptions concerning delivery of a deed?
If grantor retains possession of the deed it is presumed that it has not been delivered
Delivery is presumed if...
- the grantee has possession of the deed
- The deed is handed to the grantee
- The deed is acknowledged by the grantor in front of a notary
- The deed is recorded
200
What is the effect if a deed without conditions is transferred to the grantee with an oral condition?
Outside evidence is not permitted to show conditions when an unconditional deed is given directly to the grantee. The oral condition would be unprovable and so should be ignored
201
What is the effect of a deed containing a written condition?
The written condition is valid. (if the condition is the grantor's death a future interest is created)
202
Is delivery of a deed to a third-party with instructions to deliver the deed to the intended grantee considered valid delivery?
It depends on if the third-party is an agent of the grantor or the grantee
A delivery to the grantor's lawyer is probably not a delivery but a delivery to the grantee's lawyer probably is
203
What is an escrow transaction?
Grantor delivers an executed deed to a third-party with instructions the deed is to be delivered to the grantee once certain conditions are met.
If Grantor gives the escrow agent written instructions, the grantor is bound, but if grantor gives the escrow agent oral instructions the grantor can change the oral instructions and recall the deed from the escrow agent unless there is a written contract of sale
204
What are the rules on if a grantor can recall a deed put in donative escrow with conditions?
If the condition is something other than the grantor's death the grantor may retrieve the dead.
If the condition is the grantor's death, the grantor cannot get the deed back because they intended to presently convey a future interest
205
What is the effect of a condition of survival?
It does not convey a future interest. "Only if the grantee survives the grantor" indicates that the grantor does not intend to part with anything until death thus there is no delivery
206
What are the 5 types of deeds used to convey property? What is the difference between them?
```
The general warranty deed
The special warranty deed
The quit claim deed
The special warranty deed
The statutory special warranty deed
```
The difference is the strength of the covenants for title
207
Covenants for title based on the type of deed have nothing to do with real covenants
true
208
What are the characteristics of a quit claim deed?
The grantor isn't even promising that he has title to convey - there are no covenants for title whatsoever.
209
What are the characteristics of the general warranty deed?
It warrants against all defects and title including those attributable to the grantor's predecessors.
6 covenants for title
210
What are the six covenants for title associated with the general warranty deed?
Present Covenants (SOL starts to run at delivery)
1 – the covenant of seisin (grantor owns the estate)
2 – the covenant of the right to convey (including no temporary constraints on capacity to convey)
3 – a covenant against encumbrances (no servitudes, easements or liens/mortgages)
Future Covenants (SOL starts to run when grantee is disturbed in possession)
4 – the covenant of quiet enjoyment (grantor promises grantee will not be disturbed in possession by a third party with lawful claim of title)
5 – the covenant of warranty (grantor promises to defend against reasonable claim of title by a third party and to compensate grantee for any loss)
6 – the covenant of further assurances (grantor promises to do what is needed to protect grantee's title)
211
What is the special warranty deed?
Contains the same covenants as the general warranty deed but made only on behalf of the grantor himself and not on predecessors and interest
212
What is the statutory special warranty deed?
Some states have statutes that imply this type of deed if the deed uses the word "grant" in a conveyance without designation of the type of deed.
Makes two guarantees on behalf of the grantor only (not predecessor in interest):
1. grantor has not previously conveyed the property
2. estate is free from encumbrances made by the grantor
213
Can covenants entitled be enforced by remote grantees?
Present covenants cannot be enforced by remote grantees and don't run with the land
Future covenants run with the grantee's estate.
214
What is the effect of a line of general warranty deeds?
If the last grantee is affected by a lawful claim of title may sue anyone up the line, but many states cap recovery at the amount of consideration that the covenantor received
215
What is the difference in a voidable and void deed?
A voidable deed will be set aside only if the property has not passed to a BFP.
A void deed will be set aside even if the property has passed to a BFP.
216
What kinds of defects lead to a void deed?
Forged deed. deed that was never delivered, deed issued to a nonexistent grantee, deed that was obtained by fraud in the factum (grantor did not realize she was executing a deed)
217
What kinds of defects lead to voidable deeds?
Deeds executed by minors or incapacitated persons, deeds obtained through fraud in the inducement, duress, undue influence, mistake, breach of fiduciary duty
218
What happens if a joint owner attempts to convey the entire property by forging the signatures of the other owners?
Conveyance valid as to the interest with the genuine signature but void as to the others
If joint tenancy, there would be a severance. Buyer would hold as tenant in common with the joint tenants whose signatures were forged
219
What are the two types of fraudulent conveyances?
| What are the implications of a FC for bar exam purposes?
A deed can be set aside by the grantor's creditors if it was made
1) with actual intent to hinder/delay/defraud creditors
2) without receiving REV and debtor was insolvent oe became insolvent as a result of the transfer
Deed will be set aside UNLESS grantee took in good faith and paid REV
220
What are the 3 most important closing documents other than the deed?
1) Closing disclosure - residential mortgage lenders must provide a closing disclosure to the mortgagor at least 3 business days before closing which provides interest, principal, and closing cost amounts and specifies the amount of cash needed to close
2) Notification of Defects - list of knows defects given to buyer. If seller knew of a defect but did not disclose it, seller is liable to buyer after the fact
3) Environmental Report - owner of real property must pay to cure any environmental damage even if it occurred before they purchased so buyer/seller negotiate environmental reps
221
What is the remedy if the mortgagee fails to provide the closing disclosure within the required time?
The mortgagor may be able to cancel the mortgage or recover damages
222
What are the 3 elements required for gift of real estate via inter vivos gift?
1) Donative Intent
2) Delivery
3) Acceptance
223
What is ademption?
if a testator devises a SPECIFIC ITEM in his will but no longer owns it at the time of death, the gift fails and devisee gets nothing
224
What is the rule for ademption in the context of a real estate that has been signed but has not closed
equitable conversion says that the seller should be deemed to own the cash and buyer should be deemed to own personal property, BUT ademption doctrine says that the devisee gets the sale proceeds instead of the real estate. Ademption doctrine trumps the equitable conversion doctrine
225
What is the rule for ademption if real property is damaged before death and insurance proceeds are paid after death?
The devisee gets the insurance proceeds when they are paid
Same thing happens if the government condemns property
226
What is the exoneration doctrine?
The exoneration doctrine has mostly fallen out of favor, but is says that devisees of real estate are entitled to have liens and mortgages encumbering their property to be paid off by the residuary estate
227
What is "lapse"? What are the rules that deal with it
Lapse is when the beneficiary of a gift in a will dies before the testator.
Terms of the will govern if the issue is addressed
Under common law, if lapse occurred, the gift was void.
However, nearly all states now have "anti-lapse" statutes that prevent lapse by permitting the gift to pass to the predeceasing beneficiary's living decendants in certain circumstances (but scope varies)
228
What is the common scope of an anti-lapse statute?
Many anti-lapse statutes apply only when the named beneficiary is a descendant of the testator and variations increase the scope from there.
229
How does an anti-lapse statute practically distribute the devise to the living successors to the predeceasing beneificary?
The money/property is given directly to the living successors - not to the predeceased's estate, so property will never pass to a predeceasing beneficiary's spouse under an anti-lapse statute
230
How does an anti-lapse statute apply to a class gift?
If a class member is within the coverage of an anti-lapse statute, the issue of the class member will take the deceased class member's share of the gift
231
What is abatement?
If the estate assets are not sufficient to pay all claims against the estate and satisfy all devises and bequests, the gifts are abated (reduced) in the following order:
1) property passing by intestacy
2) residuary estate
3) general legacies
4) specific devises ad bequests
232
What is the common law rule for which conveyance prevails if it is conveyed more than once by the same grantor?
First in time, first in right
233
What is the aim of the recording system?
To protect subsequent BFPs from prior interests they could not know about
234
What is the rule for a race statute?
In a race jurisdiction, B wins if he records property before A
235
What is the rule for a notice statute?
In a notice jurisdiction, B wins if he was a BFP when he took
*true even if B never records
236
What is the rule for a race-notice statute?
In a race notice jurisdiction, B wins if he was a BFP when he took and recorded before A
237
What is a BFP?
A purchaser/mortgage lender who gave substantial value and did not have notice of the prior conveyance
238
If B paid less than FMV for the property can he still be a BFP?
Yes, as long as the value paid was substantial
239
What are the three types of notice that prevent a later purchaser from being a BFP?
1) Actual Notice
2) Inquiry Notice
3) Record Notice
240
What does inquiry notice require of the later purchaser?
Requires reasonably inspection of the actual premises
Requires any references to unrecorded transactions in the chain of title to be reasonably investigated
241
What is record notice?
A later purchaser is on notice of an earlier conveyance if it was property recorded within the chain of title.
242
How do you identify a race statute?
Look for absence of "without notice" and presence of "first"
A conveyance of an estate in land shall not be valid against a subsequent purchaser for value unless the conveyance is first recorded.
243
How do you identify a notice statute?
Look for presence of "without notice" and the absence of "first"
A conveyance of an estate in land shall not be valid against a subsequent purchaser for value WITHOUT NOTICE unless the conveyance is [] recorded.
244
How do you identify a race notice statute?
Look for presence of "without notice" and "first"
Any conveyance of an interest in land shall not be valid against any subsequent purchaser for value WITHOUT NOTICE thereof whose conveyance is FIRST recorded.
245
What is the shelter rule?
It protects any grantee of a BFP against anyone that the BFP would have prevailed against - including donees and those with notice of the prior conveyance. Grantee steps into the shoes of the BFP. This rules is to protect the BFP's ability to sell.
246
What is a wild deed? What is the effect?
A recorded deed that is not in the chain of title. Because it is not in the chain of title, it cannot be found by the subsequent purchaser so it does not impart constructive notice
247
What is estoppel by deed?
If a party sells a property that they do not have and then later actually acquires the property, they cannot challenge the validity of their own prior conveyance.
But estoppel by deed is only PERSONAL estoppel and does not help a grantee of the hollow transfer against G2 if the grantor again transfers his (this time good) title to G2
248
Is a restrictive covenant recorded in the deed of a neighboring lot from he same grantor that encompasses the subject lot considered to be in the chain of title of the subject lot?
Court are split, but the better view is that these covenants are not in the chain of title
249
Are judgment creditors protected by a recording act if they file a lien on real property?
Most states say no. Mortgage lenders are protected and judgment creditors are not because mortgage lenders gave value in specific reliance on recourse to the property.
250
Who is the mortgagor and who is the mortgagee?
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Mortgagor = the person who bought the house (borrower)
Mortgagee = the lender
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251
Is a mortgage subject to SoF?
Yes
252
How can a mortgagee transfer their interest in the mortgage?
EITHER:
- endorse the note and deliver it to the transferee OR
- execute a separate document of assignment
The mortgage automatically follows the note
253
What are the two possible results for the mortgage when a mortgagor transfers their interest in the property?
1) Grantee assumes the mortgage by agreeing to be personally liable on it (seller remains secondarily liable as surety)
2) Grantee takes subject to the mortgage but is not personally liable for it (this is the default absent express assumption)
254
Can a mortgagee be protected by a recording statute as a BFP?
Yes but must be a mortgagee for value (can't receive the mortgage on account of a preexisting debt)
255
If a bank records a mortgage on property to secure a loan, that loan is mostly repaid and then a later loan is made, when is priority established for the later value loaned?
The later loan does not have the same priority as the earlier loan. The new loan sets priority as of that date
256
If a loan is modified to make it more burdensome after a buyer assumes a mortgage is the seller/original mortgagor still on the hook as surety?
No - original mortgagor is let off the hook 100%
257
What is a due on sale clause?
Allows the lender to demand payment in full on the loan if the mortgagor transfers any interest in the property without the lender's consent
258
What procedure is required for a mortgagee to foreclose on a property?
What happens if a junior lien is not given notice/joined?
1) Must use a proper judicial proceeding
2) Join all junior interest holders and the debtor (else that party's interest remains on the property)
If the junior lien is not given notice/joined, then the junior lien is not discharged and the junior lien does not get any money from the foreclosure sale
259
Is the buyer at a foreclosure sale personally liable on a senior mortgage that is not discharged in the sale?
No, but the sr mortgagee can still foreclose against the land so it's a good idea to pay it off
260
What is the default common law rule as to priority
You have no priority vs another creditor until you record.
| Once recorded, it's first in time first in right by default
261
What is so great about a purchase money mortgage?
It jumps to first priority ahead of any floating liens but is subject to defeat by later liens if the purchase money mortgage not recorded.
262
When does the equitable right of redemption end? How does one exercise it?
What is the statutory right of redemption and when does that end? How does one exercise it?
Date of sale
Can exercise it by paying off past due balance and interest and costs UNLESS there is an acceleration clause and then would need to pay off the entire balance and interest and costs
Owner's Statutory right of redemption exists in about half the states and ends after some statutory period AFTER the the sale. Can be exercised by paying the statutorily defined amount which is usually the foreclosure sale price
Lienholder's statutory right of redemption allows a junior lienholder to pay off the debt secured by a senior lien before the foreclosure sale. If exercised, the junior lienholder is subrogated to the senior's rights against the mortgagor
263
Can the mortgagor waive the right to redeem in the mortgage itself?
No - can't "clog the equity of redemption"
264
If owner owns a dominant parcel in fee simple and acquires a life estate in the servient parcel, is the easement extinguished by merger?
No - For the easement to terminate by merger, duration of the servient estate must be equal to or longer than the duration of the dominant estate (ie the duration of the easement)
265
No encumbrance created by a life tenant can extend beyond the life tenancy
true
266
How can a life tenancy end early?
If the life tenant commits waste or renounces the life estate
267
If there is a will making a class gift and...
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a class member predeceases the testator, do the class member's heirs take?
What if the class member survives the testator and then dies before the class closes, does the class member's heirs take?
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No
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Yes
Class member has to survive the testator for their heirs to take, but if survives testator, then can die before the class closes and heirs can still take
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268
What are limitations on zoning power?
Subject to the same limitations as all state police power - Due process and Equal Protection Clauses of 14th amd and the takings clause of the 5th amd
269
What is a zoning variance?
grants a landowner permission to depart from the zoning ordinance
270
What must someone seeking a variance show?
How is a request for variance reviewed?
Must show:
1) Undue hardship (hardship you did not impose yourself)
2) If granted, the variance would not decrease neighboring property values
Variance application is reviewed by a zoning board
271
When are zoning ordinances invalid?
If they:
1) have no reasonable relation to public welfare, are too restrictive,
2) are discriminatory as to a particular parcel,
3) are beyond the grant of authority,
4) violate due process, or
5) are racially discriminatory
272
Can a once lawful use of a piece of property be eliminated by zoning?
What is this called?
What are the restrictions on the use?
No this is called a nonconforming use- if the property is currently being used for that use, just comp must be provided
The nonconforming use cannot be extended or intensified in a way that constitutes a substantial change. Can make reasonable changes to repair or make them practicable for their purposes. If there is any doubt as to whether a change is substantial or insubstantial, the doubt is resolved against allowing the change
273
What is a cumulative zoning scheme?
Creates a hierarchy of uses where land can be used for the zoned use or any higher use
274
What is a noncumulative zoning scheme?
Property can only be used for the purpose for which it is zoned
275
What is a special use permit and when must it be obtained?
A special use permit is one that must be obtained even though the zoning is proper because the intended use is in a special category like a hospital, funeral home, drive in business, etc (usually for safety reasons)
276
What does a person own when they own a condo?
Each owner owns the interior of their unit and an undivided interest in the exterior and common elements as tenant in common
277
What is the structure and function of an HOA?
Each condo owner is a member of the HOA. Members elect the board and board manages the property and enforces rules. The association is a legal entity such as a corp or LLC
278
How does a HOA make and enforce rules?
HOAs pass charters and bylaws that create rules that are included in a "declaration of covenants, conditions and restrictions" (CC&R) which are restrictive covenants/equitable servitudes.
These are enforced by the board
279
What if the fees paid to the HOA are not sufficient to pay for necessary expenses?
A one time special assessment is made
280
What are cooperatives?
| What's special about them for property purposes?
In a cooperative, title to land and buildings is held by a corp that leases individual apartments to its shareholders.
Shareholder-tenants are economically interdependent, so direct restraints on alienation are valid
281
What is an owner's right to lateral support?
An owner has the right to lateral support of their land in its natural state (strict liability)
Can sue neighbor for damages to improved property if the neighbor was negligent in digging.
If can show that land would have been harmed even in natural state, then can recover from neighbor under strict liability even if land is improved
282
What are the duties fo an underground occupant of land?
Strict liability to support the surface and buildings existing on the date the subjacent estate was created.
Liability fo subsequently erected buildings requires negligence
283
What are the two system for determining allocation of water in watercourses?
1) Riparian doctrine
| 2) Prior appropriation doctrine
284
What is the prior appropriation doctrine
Water initially belongs to the state but the right to divert it and use it can be acquired by an individual through their actual use, regardless of whether or not they are a riparian owner.
Rights determined by priority of beneficial use (usually first in time first in right). Rights can be lost by abandonment
285
What is the riparian doctrine?
Water belongs to those who own land bordering the waterway.
| Riparian rights attach to all contiguous trans held by the same owner as long as one of the tracts abuts the water.
286
What are the 3 versions of the riparian doctrine?
1) Natural Flow theory: Riparian owner's use is enjoyable if it results in a substantial or material diminution of the water's quantity, quality or velocity
2) Reasonable use theory: Most Common: Riparian owner can make reasonable use (reasonable = does not substantially interfere with the use of others
3) Natural v Artificial Use: Natural uses (consumption/gardening) prevail over artificial uses (irrigation and mfg)
287
What are the 5 systems governing the use of groundwater (or "percolating" water)?
1) Absolute ownership doctrine (can take all you want including for export)
2) Reasonable Use Doctrine (can take all you want but export right limited if interferes with others)
3) Correlative Rights Doctrine (owners of overlying land own the water basin as joint tenants so reasonable use allowed for their own use)
4) Appropriative Rights Doctrine (priority of use, not ownership of overlying land, determines)
5) Restatement Approach (owner of surface can pump reasonable share unless harms neighboring landowners or surface water users)
288
What is surface water?
Water that flows without a channel over land and has not yet reached a watercourse or basin
289
Who can use surface water?
Landowners can use surface water within their boundaries for whatever purpose they want
290
What are the theories for liability for alterations of surface water?
1) Natural Flow Theory (Owners cannot alter natural drainage patterns - but most states have softened the rule to allow reasonable changes)
2) Common Enemy Doctrine (owner can take any protective measures to get rid of water or combat its flow - but most states have softened to prohibit unnecessary damage to others land)
3) Reasonable Use Theory (Balances the utility of the use against the gravity of the harm)
291
Does a landowner have a right to the airspace above their house?
Yes, landowners have a right to the airspace above their house but it is not exclusive.
Owner entitled to freedom from excessive noise
292
Is frustration of purpose ever grounds to terminate a lease?
No
293
When a deed of trust is foreclosed, is a judicial proceeding and sale required?
Usually no but must be permitted by the state
294
If a conveyance from O says "to B for life and then to by surviving children" who do the children have to outlive to be considered "surviving"? O or B?
The children have to survive B. If a child survives O and then predeceases B, the child's heirs take nothing
