Real Property

Question 1

The words “from O to O and A as joint tenants with right of survivorship” creates what type of interest?

Answer 1

A tenancy in common because the four unities are not met

Question 2

If an easement is said to be surcharged, this means:

Answer 2

the easement’s legal scope was exceeded

Question 3

Exceeding the scope of an easement (does/does not) terminate the easement.

Answer 3

does not

Question 4

What is the servient landowner’s remedy for a surcharged easement?

Answer 4

The landowner may enjoin the excess use or sue for damages if the land has been harmed

Question 5

In what circumstance might a quasi-easement be implied and what are the requirements?

Answer 5

A quasi-easement might be implied when a landowner divides a parcel and sells the lots to two different people. The requirements are:
(1) the previous use on the servient part of the parcel was apparent and continuous
(2) the parties expected that the use would survive division because it is reasonably necessary to the dominant tenement’s use and enjoyment of the property.

Note that actual knowledge on the part of the servient landowner is irrelevant, the issue is whether the use was apparent and continuous.

Question 6

A landowner and her neighbor owned adjoining parcels of land. The landowner’s property was situated to the west of the neighbor’s property. A highway ran along the east of the neighbor’s property. Twelve years ago, the landowner asked the neighbor if it would be all right for the landowner to use an eight-foot strip along the northern part of the neighbor’s land to access the highway. The only other way for the landowner to get to the highway was to use a one-lane unpaved road that meandered through the woods for two miles. The neighbor agreed, and the landowner used the strip of land regularly to access the highway. The statutory period for adverse possession in this jurisdiction is 10 years.

What is the landowner’s interest in the neighbor’s eight-foot strip of land?

Answer 6

A mere license to use the land.

Question 7

Unless an easement is implied or created by necessity or prescription, it must be _________ to be valid.

Answer 7

In writing, due to the Statute of Frauds

Question 8

How much notice is required to terminate a year-to-year periodic tenancy?

Answer 8

six months, or 1 month under the restatement (1 mo is the preferred approach for the exam)

Question 9

How is a tenancy at will terminated?

Answer 9

(1) at common law, immediately upon election of either party
(2) under the modern approach, after notice & reasonable time to vacate
(3) by operation of law, if
(a) either party dies
(b) the tenant commits waste
(c) the tenant attempts to assign the tenancy
(d) the landlord transfers his interest in the property
(e) the landlord executes a term lease to a third party

Question 10

What is the hold-over doctrine?

Answer 10

If a tenant continues in possession after their right to possession has ended, the landlord may
(1) evict the tenant
(2) bind the tenant to a new periodic tenancy, based on the way the rent was computed under the original lease

Question 11

What are the hold-over doctrine rules specific to commercial tenants?

Answer 11

Commercial tenants may be held to a year-to-year periodic tenancy if the original lease term was for one year or more.

If the original term was less than one year, the new tenancy is presumed to be a month-to-month tenancy.

Question 12

What is required for a valid deed?

Answer 12

(1) writing
(2) signed by the grantor
(3) unambiguous description of the land
(4) identification of the parties by name or description
(5) words of intent to transfer

Question 13

Is a deed granting Blackacre “to grantee” valid?

Answer 13

No, unless the grantee later names himself in the deed.

Question 14

What is the statutory period for adverse possession?

Answer 14

The statute of limitations for an ejectment action

Question 15

Do recording statutes protect purchasers against grants obtained via adverse possession?

Answer 15

No

Question 16

What are the three types of notice and what do they mean?

Answer 16

Actual- what the purchase actually knows
Inquiry- notice of what the purchaser would have discovered by making a reasonable inquiry into the property (either by inspecting the chain of title or the physical land)
Record- notice that is imputed to the purchaser of a properly recorded deed in the grantee’s chain of title

Question 17

O grants “to A, but if he ever tries to sell within his lifetime, to B.” Is this conveyance valid?

Answer 17

No, because it is an absolute forfeiture restraint on a fee simple estate.

Question 18

State the ways in which a deed can be delivered

Answer 18

(1) physical delivery
(2) delivery by mail or agent
(3) delivery to third party (with instructions = valid, without instructions = valid if third party is grantee’s agent)
(4) grantor expresses intent that title pass immediately

Question 19

What are the covenants in a special warranty deed?

Answer 19

the six covenants of a general warranty deed, only on behalf of the grantor himself and not his predecessors

present covenants:
- seisin (grantor has ownership)
- right to convey (power to transfer)
- against encumbrances

future covenants
- quiet enjoyment (no third party will later claim lawful title)
- warrant (grantor will defend against reasonable claims of title)
- further assurances (grantor will do whatever is needed to perfect grantee’s title)

Question 20

A zoning violation in existence at the time of a conveyance violates which deed covenant?

Answer 20

The covenant against encumbrances

Question 21

A statutory special warranty deed implies what two covenants?

Answer 21

(1) the grantor has not previously conveyed the same estate to anyone else
(2) covenant against encumbrances

Question 22

What is the result if a husband and wife own property as tenants by the entirety and the husband attempts to unilaterally convey the property to a third party?

Answer 22

The conveyance has no effect (as to either interest) and the husband and wife remain the owners as tenants by the entirety.

Question 23

Describe the effect of condemnation on a landlord-tenant relationship

Answer 23

If the entire leasehold is condemned, the tenant’s liability for rent is extinguished. If only part of the leasehold is condemned, the tenant is not discharged from the rent obligation, but is entitled to compensation for the taking.

Question 24

L leases to T1. T1 assigns to T2. T2 assigns to T3. T3 fails to pay rent.

What would need to be true in order for L to go after T2 for unpaid rent?

Answer 24

(1) T2 promised L directly to be responsible for the rent (creating a contract relationship between L and T2)
(2) T2 promised T1 to be responsible for the rent (L becomes a third-party beneficiary of the K between T1 and T2)

Question 25

A landlord who owned a strip mall entered into a written five-year lease of one of the units with a discount retail perfumery. The lease provided for a monthly rent of $1,000, payable on or before the first day of each month. The perfumery dutifully paid its rent on time for two years and three months. At that time, with the oral permission of the landlord, the perfumery transferred its interest in the remainder of the lease to a dry cleaner in writing, and added a clause requiring the dry cleaner to get permission from the perfumery for any subsequent assignments. The dry cleaner promptly paid rent to the landlord for 14 months, and then asked the landlord to approve a transfer of its interest in the lease to a video rental store. The landlord gave her oral assent. To obtain the perfumery’s approval of the transfer to the video store, the dry cleaner wrote a letter to the perfumery, promising that if any problems arose and anyone tried to go after the perfumery for money, the dry cleaner would “make it good.”

After the perfumery sent a letter back to the dry cleaner agreeing to the transfer, the dry cleaner executed a written transfer of its interest to the video store. The video store promptly paid rent for three months. Having failed to make any profits, the video store ceased paying any rent to the landlord and cannot be located. The landlord has been unable to find anyone interested in the unit.

Given that any judgment against the video store would be worthless, from whom can the landlord collect the unpaid rent owed on the lease?

Answer 25

Both the perfumery and the dry cleaner

Question 26

Three years before his death, a landowner leased his land to an oil company. The lease gave the lessee the right to drill for oil and gas for a period of 25 years and provided for the payment of a royalty for oil and gas removed. While the landowner was alive, no oil or gas was discovered. Upon his death, he devised the land to his son for life, remainder to his grandson. The residue of his estate was left to his widow. The year after the landowner died, oil was discovered on the land, and royalties became due.

To whom should the royalties be paid?

Answer 26

The son. The right to receive royalties from oil or minerals extracted from a parcel of land is appurtenant to the right of ownership of that land, and it therefore goes to the current possessor of the real estate.

Question 27

What is a “secret” deed and what effect does it have on a joint tenancy?

Answer 27

A secret deed is a deed that is to take effect only upon the grantor’s death. The secret deed severs the joint tenancy unless the grantee does not know about the deed until after the death, in which case the joint tenancy remains intact and the grantor’s interest passes to the other joint tenant through the right of survivorship.

Question 28

Do recording statutes protect buyers who record land sale contracts rather than deeds?

Answer 28

Yes.

Question 29

If there is a hold-over tenant occupying a leased premises at the beginning of the lease term, what covenant has the landlord breached?

Answer 29

The covenant of quiet enjoyment (via actual eviction).

Question 30

An entrepreneur opened a specialized business on her land. After using up most of her capital to purchase inventory, however, the entrepreneur needed more funds and asked her friend for a $30,000 loan, to be secured by the business’s inventory. The friend declined the loan. A desperate entrepreneur then told the friend she would convey the land, which had a fair market value of $100,000, to him if he would give her the loan at the current market rate of interest. The friend agreed, and the entrepreneur conveyed the land to the friend the next day. At that time, the friend gave the entrepreneur $30,000 in cash, and the parties orally agreed that the entrepreneur would pay the friend back at the rate of $1,000 per month, and that after the loan was paid in full, the friend would reconvey the land to the entrepreneur. The friend immediately recorded his deed to the land.

The entrepreneur made three $1,000 payments to the friend and then paid no more. She continued to live on the land but, being very much in debt, could not repay the loan. The friend, meanwhile, had received an offer to buy the land for $100,000.

Can the friend sell the property?

Answer 30

Yes, but only after foreclosing on the property. This transaction will be characterized as an equitable mortgage.

Factors to consider:
(1) the existence of a debt or promise of payment by the grantor
(2) the grantee’s promise to return the land if the debt is paid
(3) the difference between the amount advanced and the value of the property
(4) the degree of the grantor’s financial distress
(5) the parties’ prior negotiations

Question 31

A wealthy widow died, devising all of her property (real and personal) by will to her friend. However, just before her death, the widow deeded a small office building to a women’s rights organization for use “as long as they work to promote the passage of the Equal Rights Amendment (‘ERA’); however, if they fail to work to promote its passage or the ERA is passed within 20 years of the date of the deed, the property shall pass to a nonprofit organization that assists young female entrepreneurs.” Although this jurisdiction is a common law one with respect to all real property matters, the state’s probate laws provide that future interests or estates in real property may be passed by will or descent in the same manner as present interests. The common law Rule Against Perpetuities applies in this jurisdiction.

What interest does the women’s rights organization have in the office building?

Answer 31

A fee simple subject to an executory limitation.

This is an example of a charity-to-charity exception to the RAP.

Question 32

A landlord leased a vacant commercial building to a tenant for a 10-year term. On taking possession, the tenant installed a bar, booths, special lighting, and a raised dance floor. The bar and booths were simply placed on the floor and were not secured to it. The lights were installed by a qualified electrician and were directly wired into the building’s electrical system. The special dance floor was bolted to the building’s cement floor by installation crews from the company that made the dance floor. After installation of the above, the tenant then operated her business for almost 10 years. At that time, she decided that business was so good that she would move to a larger space down the street. She told the landlord that she would not be renewing her lease and that she would be removing the lights, booths, bar, and dance floor. The landlord told her that none of the installations could be removed because they are now part of the building.

If a court were called upon to resolve this dispute, how would it likely rule?

Answer 32

All of the items listed may be removed either because they were not affixed to the real property or because they were used in the tenant’s business and thus may properly be termed trade fixtures. As long as the tenant can remove trade fixtures with little damage to the real property, the tenant may always take them when the tenant moves.

Question 33

What is the covenant of the right to convey in a general warranty deed, how is it breached, and what are the remedies?

Answer 33

A general warranty deed is one in which the grantor covenants against title defects created both by himself and by all prior titleholders. The right to convey is a covenant that the grantor has the power and authority to make the grant. It is breached, it at all, at the time of conveyances if the grantor is not the owner of the interest he purports to convey. The grantee has a cause of action against which the statute of limitations begins to run at the time of the conveyance.

Question 34

What is the title theory of mortgages?

Answer 34

The title theory states that the mortgagee has the title to the property until the mortgage has been satisfied or foreclosed. Under the title theory, a mortgagee is entitled to possession on demand at any time.

Note that the equitable right of redemption does not affect the mortgagee’s right to possession before foreclosure.

Question 35

When is a deed presumed to be delivered?

Answer 35

(1) handed to grantee
(2) acknowledged by the grantor before a notary
(3) recorded

note that in the last two, the grantor can maintain physical possession of the deed and grantee does not need to be aware of the deed

Question 36

What is the legal effect of a grantee destroying a deed or giving a deed back to the grantor after she has accepted the deed?

Answer 36

None. Title passes on acceptance of the deed, and the deed becomes mere evidence of the grantee’s title.

Question 37

O conveys to A for life, then to B; but if B predeceases A, to C.

What interests do the parties have?

Answer 37

A - life estate
B - vested remainder subject to total divestment (if B does not survive A)
C - shifting executory interest (divests B’s interest if B does not survive A)

Question 38

O conveys to charity A, but if the premises are no longer used as a museum, to charity B.

What interests do the parties have?

Answer 38

charity A has a fee simple subject to an executory interest.

charity B has an executory interest.

Note that the RAP does not apply pursuant to the charity-to-charity exclusion.

Question 39

A mansion has been in a landowner’s family homestead for 100 years. It is in a mixed use area of a city, which has also been zoned for apartment buildings. Many homes in the area have been torn down to build new apartment structures. The landowner wants to sell the mansion but does not want the house torn down or the land used for an apartment building.

Which of the following will most successfully accomplish his objective?

(A) A restrictive covenant
(B) a negative easement
(C) a fee simple determinable
(D) a right of first refusal in the landowner and his heirs and assigns

Answer 39

A fee simple determinable.

A covenant does not run with the land or bind successive owners unless there is a benefitted estate, which is not present here.

An easement would be “in gross,” and would automatically terminate at the landowner’s death.

A right of first refusal given to a grantee and “his heirs and assigns” is invalid because it violates the RAP.

Question 40

Explain why the conveyance “O to A for life, then to A’s widow for life, then to A’s children” is valid but “O to A for life, then to A’s widow for life, then to A’s surviving children” is not.

Answer 40

The interest “to A’s children” vests at A’s death.

The interest “to A’s surviving children” vests at A’s widow’s death. Because of the “unborn widow” problem, the widow cannot be a measuring life and this interest could vest more than 21 years after A’s death.

Question 41

A seller conveys property to a buyer via a special warranty deed. The buyer discovers that the seller built a well on the property in violation of a zoning ordinance. The seller was not aware of the zoning ordinance. Does the buyer have a claim against the seller?

Answer 41

Yes. The seller has breached the present covenant against encumbrances.

Question 42

A landowner included in his will a provision giving “all of my property, both real and personal, wherever situated, to my widow for life, and after her death to any of our children who may survive her.”

What is the gift to the children?

Answer 42

A contingent remainder.

Note that this interest does NOT violate the RAP because both the widow and the landowner’s children will be lives in being at the landowner’s death.

Question 43

A landowner owned two heavily wooded adjoining parcels of land containing a number of lakes. She conveyed the eastern parcel, which contained a hunting resort, consisting of a number of rental cabins, to a neighbor. The deed transferring the parcel also granted to “the neighbor, his heirs and assigns, and to invited guests of the resort all hunting rights and use of the woods on the western parcel for the benefit of the resort.”

What type of interest was created by this grant?

Answer 43

A profit appurtenant.

Rights to remove game from land can only be granted through a profit, not an easement.

The profit is appurtenant because it was intended to benefit the dominant parcel (the grant expressly states that it is “for the benefit of the resort”).

A profit appurtenant can only be transferred with the dominant estate. A profit in gross could be transferred apart from the dominant estate.

Question 44

When is an easement by necessity terminated?

Answer 44

As soon as the necessity ends (regardless of whether the holder of the easement intends to try to enforce the easement after the necessity ends).

Question 45

A lease gives a lessee, his heirs, and assigns an option to purchase the land at any point during the lease term. Is this provision subject to the RAP?

Answer 45

No, unless the lessee assigns his interest so that the option is separated from the leasehold estate.

Question 46

During her teenage years, a niece had often been told by her elderly aunt that when she died, she would leave the niece her beach house. Fifteen years later, the aunt was still the record title owner of the property and remained in good health. The niece grew impatient and decided to sell the property. She conveyed title to the beach house by quitclaim deed to a doctor for $150,000. The doctor did not conduct a title search and recorded the deed immediately.

Five years later, the aunt died and devised the beach house to the niece.

The niece is now contesting the doctor’s title and claiming ownership of the beach house, and the doctor counterclaims.

Which party has title to the property?

Answer 46

The niece, because estoppel by deed does not apply to quitclaim deeds.

Question 47

What test is applied to determine the validity of a rule imposed by an association governing a common-interest community?

Answer 47

The rule is valid if it is reasonably related to furthering a legitimate purpose of the association.

Question 48

What test is applied to determine the validity of rules contained in the deeds or declarations of a common-interest community?

Answer 48

The rule is valid unless it is illegal, unconstitutional, or against public policy.

Question 49

A landowner embarked on an expedition into a remote jungle, leaving no means to communicate with him. Because property values suddenly began plummeting in the landowner’s neighborhood, his son believed that it was imperative to sell his father’s property before it became worthless. Having no way to speak to his father ahead of time, the son prepared a deed conveying the property to a buyer, but left the line for the buyer’s name blank. He then signed his father’s name on it as the grantor, and handed the deed to the buyer. The deed, however, did not include any language regarding the amount the father was to receive in exchange for the property. The buyer believed that the son was the owner of the property. When the father returned, he was happy that the property had been sold.

What is the legal effect of the landowner’s approval of the sale?

Answer 49

None. The deed is void because the father’s signature was forged. The father’s subsequent ratification of the conveyance is irrelevant.

Question 50

What are the requirements for a written easement to be terminated by estoppel?

Answer 50

(1) conduct or assertion by the owner of the easement
(2) reasonable reliance by the owner of the servient tenement
(3) a change of position

Question 51

A landowner granted to his adjoining neighbor a written easement in a driveway that crosses the southwest corner of the landowner’s property. The easement was not recorded. A statute of the jurisdiction in which the landowner’s and neighbor’s properties are located provides: “No unrecorded interest in real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded.”

If the landowner sells his property to a purchaser for value who is unaware of the easement, is the easement terminated?

Answer 51

No, because the purchaser will have inquiry notice of the easement.

Question 52

What is constructive annexation?

Answer 52

When an article of personal property becomes an integral part of the real property, even though it is not physically annexed or connected to the property.

Question 53

What are the essential terms of a land sale contract? (i.e. the terms that would have to be included in a writing to satisfy the statute of frauds)

Answer 53

(1) description of the property
(2) identification of the parties to the contract
(3) price
(4) signature of the party to be charged

Question 54

What is the covenant of warranty in a deed?

Answer 54

A covenant of warranty is a promise on the part of the seller to defend the title against anyone who unlawfully claims title to the property being conveyed.

Question 55

When is a seller liable to the buyer for failure to disclose a fact regarding the land?

Answer 55

When the seller fails to disclose problems that could affect the property’s value or desirability, especially if the problem is not discoverable by the buyer.

Question 56

What is title insurance?

Answer 56

Title insurance is an insurance policy that insures that a good record title of the property exists as of the policy’s date and agrees to defend the record title if litigated.

Question 57

What is an “owner’s” title policy?

Answer 57

A title insurance policy that protects only the person who owns the policy (could be the property owner or the mortgage lender) and does not run with the land to subsequent purchasers.

Question 58

What is a “lender’s” title policy?

Answer 58

A title insurance policy that follows any assignment of the mortgage loan. A lender’s policy terminates when the mortgage loan is paid off.