Real Property Flashcards
Vested Remainder
A remainder that automatically becomes possessory upon the natural expiration of the preceding estate.
Limitations- Vested Remainders cannot:
a) Be subject to any condition precedent; or
b) Vest in an unknown or unascertained person.
3 Types of Vested Remainders:
1) Indefeasibly vested remainder- becomes possessory immediately upon termination of the prior estate (to A for life, then to B).
2) Vested remainder subject to total divestment- subject to some condition subsequent, such that the remainderman could be divested after taking possession (to A for life, remainder to B; but if B weds, to C).
3) Vested Remainder subject to open (class gift)- remainder vested in a described class of takers, at least one of whom is capable of taking possession (by virtue of being alive) (to A for life, remainder to children of B and their heirs”; B has one child, who has a vested remainder subject to open {because B may have more heirs}.
Open vs. Closed class- class stays open to allow for future members and closes when no new members can be created (life tenant dies).
Rule of Convenience- class closes whenever any member can call for distribution of her share.
Contingent Remainder
A remainder will be contingent if it is either:
a) Subject to a condition precedent, or
b) Created in favor of an unascertained or unborn person.
Subject to Condition Precedent- remainder’s taking is contingent on the occurrence of some event or condition.
-Once the event or condition occurs, the interest automatically becomes an indefeasibly vested remainder (to A for life, then to B and his heirs when B gets married…If B is unmarried at the time of the conveyance, A has a life estate, B has a contingent remainder (because marriage is a condition precedent), and grantor has a reversion in case B is not married when A dies; If B gets married he has an indefeasibly vested remainder).
Subject to unborn or unascertained persons- a remainder is contingent if it is created in favor of unborn or unascertained persons (to A for life, then to B’s heirs…If B has no children at the time of the conveyance, remainder is contingent because heirs of B cannot be ascertained until B dies).
Rule of Destructibility
At common law, a contingent remainder is destroyed if it remains contingent (the condition not satisfied) when the preceding estate ends (O grants to A for life, then to B once he goes to law school; A dies and B has not gone to law school…At common law, B gets nothing; at modern law, a reversion to grantor or grantor’s heirs until grantee satisfies the condition).
Merger (Shelley’s Rule)
Arises when a conveyance attempts to give a life estate to grantee with remainder to grantee’s heirs.
At common law, the two estates merge (“to A for life, then to A’s heirs”…and A is alive)
Common Law- remainder merges and A has a fee simple absolute.
Modern rule- A has a life estate and his heirs have contingent remainders; O has a reversion because A could die without heirs.
Doctrine of Worthier Title
Arises when grantor creates a life estate in another but creates a future interest in grantor’s heirs.
(O grants “to A for life, then to O’s heirs”)
Under the doctrine, the contingent remainder in O’s heirs is void; A instead has a life estate and O has a reversion.
Shifting Executory Interest
Always follows a defeasible fee.
Cuts short someone other than the Grantor
(to A, so long as the property is used for storage. But if used for any other purpose, to B)
-A has a fee simple subject to an executory interest
-B has a shifting executory interest- If A stops using the property for storage, A’s interest is cut short (not the grantor’s).
Springing Executory Interest
Cuts short the interest of the Grantor or his heirs.
(To A, if and when he gets married)
A has an executory interest
Grantee has a fee simple subject to an executory interest; If A gets married, possession springs from Grantor to A.
Analyzing a Conveyance subject to RAP
1) Determine the interest being granted;
2) Apply RAP to any interest for which RAP applies;
3) If conveyance violates RAP, stroke only the violating portion.
What remains = new conveyance
Tenancy in Common
An estate with multiple tenants in which each co-tenant owns a distinct, undivided interest and each has a right to possession of the whole estate.
Characteristics:
Freely Transferable- each interest is freely descendible, devisable, and alienable.
Co-tenants only share the right to possession.
No survivorship rights- a co-tenants interest can be transferred to heirs upon her death
Partition- a co-tenant can force partition at any time and take sole ownership of her share in the estate while the remaining parties hold their interests as tenants in common.
Modern law favors tenancy in common; it is the default concurrent estate.
Joint Tenancy
Creation- 4 conditions must concurrently exist when the tenants take their interests:
1) Time- JT’s must take their interest at the same time;
2) Title- JT’s must receive their conveyance through the same instrument;
3) Interest- JT’s must take equal and identical interests; and
4) Possession- JT’s must have equal possessory rights.
(alienable but not devisable or descendible).
Tenancy by the Entirety (severance)
4 ways to sever, which creates a tenancy in common:
1) Death of one co-tenant;
2) Mutual agreement of the parties in writing;
3) Issuance of a divorce decree; and
4) Execution by a joint creditor (foreclosure).
Tenancy for Years
-Lasts for a fixed period of time;
-Requires a definitive beginning and end date;
-If duration is longer than one year, lease must be in writing;
-Terminates automatically at the end of the fixed period (no notice is required);
-Also referred to as an “estate for years,” “term for years,” or “fixed term tenancy.”
Periodic Tenancy
A leasehold that is continuous for successive intervals (weeks or months) until either party gives notice of termination.
Creation-
-Express agreement- conveyed to tenant for agreed interval
-Implication- a lease that does not specify duration, but provides for rent to be paid at set intervals
-Operation of Law- 2 situations:
1) Invalid lease- if tenant takes possession despite an invalid lease, periodic tenancy arises upon the landlord’s acceptance of payment (period of the tenancy is determined by the period the payment covers;
2) Holdover tenant- if landlord accepts rent from a holdover tenant, a periodic tenancy arises for the period the payment covers.
Termination- occurs when the tenant gives proper notice, which requires:
1) Sufficient time- tenant must give notice one full period in advance; year to year tenancies require 6 months notice;
2) Effective Date- effective date of termination must be at the end of the period of the tenancy.
(Parties can agree to modify these requirements).
Tenancy at Will
A tenancy with no fixed duration, terminable by either party at any time without notice.
Creation- express agreement
-Without an express agreement, courts will treat the release as an implied periodic tenancy.
Termination- by will or operation of law
-By will- either party can terminate the lease at any time without notice, but a reasonable demand to vacate the premises is usually required.
-By operation of law- occurs upon any of the following:
1) Death of either party;
2) Waste by the tenant;
3) Assignment by the tenant;
4) Transfer of title by the landlord; or
5) Lease by the landlord to a third party.
Landlord’s Remedies for Tenant Breach
If tenant breaches his leasehold duties, landlord’s options depend on whether tenant retains possession.
Tenant retains possession- landlord may:
a) File for notice of eviction; or
b) Continue the lease and sue for rent due.
Tenant abandons premises- landlord may
a) Surrender- treat the abandonment as tenant’s surrender and accept it, releasing the tenant from the lease; or
b) Ignore (minority rule)- hold tenant liable for unpaid rent; or
c) Re-let (majority rule)- lease premises to new tenants and hold the breaching tenant liable for any losses.
No self-help
Security Deposit
No retaliatory eviction
Implied Covenant of Quiet Enjoyment
A tenant has an implied right to quiet use and enjoyment of the premises, without interference from the landlord.
Actual Eviction- landlord wrongfully evicts or excludes tenant from property.
Constructive Eviction- landlord’s actions or inactions render the property uninhabitable.
Elements:
1) Substantial Interference- major and/or chronic problems;
2) Notice- tenant must inform the landlord and give him a reasonable opportunity to repair; landlord must fail to act meaningfully; and
3) Vacate- tenant must vacate within a reasonable period after the landlord fails to repair.
Implied Warranty of Habitability
Residential property must be fit for basic human dwelling
Characteristics:
-Not applicable to commercial leases;
-Absolute duty – cannot be modified by lease terms;
-Local code or case law specifies the standard for a breach;
(no heat in winter; no plumbing; no water, etc.).
Tenant’s remedies for landlord breach:
1) Move- vacate premises and terminate the lease;
2) Repair- make reasonable repairs and deduct the costs from future rent;
3) Reduce or withhold rent- until a court determines the fair rental value given the breach;
4) Remain- and seek money damages.
Landlord Tort Liability to Tenant
Landlord is liable for injuries involving:
1) Common Areas- duty of reasonable care (stairways, hallways);
2) Latent Defects- duty to disclose he should reasonably know of;
3) Assumption of Repairs- negligence standard (negligent repairs LL chooses to undertake);
4) Public Use- liable for known defects if he knows the property is for public use and tenant is unlikely to repair (concert hall, convention center);
Seasonal or short-term lease of a furnished dwelling- LL is liable for defects that cause harm to tenant.
Assignment
Entire leasehold transfers from tenant to assignee.
-Assignee is in privity of estate with LL (the two are bound by all covenants that run with the land;
-Assignor remains in privity of contract with LL;
-Assignee owes rent directly to LL, but assignor may be held liable for unpaid rent.