Real Property Flashcards
Fee Simple
Default estate, O to A
Defeasible fee
Conveyance in fee simple in which the grantor places express conditions on the conveyance. Capable of lasting forever, but may be terminated by the occurrence of an event
A defeasible fee gives the grantee a present possessory interest in the property, but reserves a future interest in the property in favor of the grantor or a third party
Three types of defeasible fees
fee simple determinable, fee simple subject to condition subsequent, and fee simple subject to executory interest
Fee simple determinable
A fee simple determinable is a conditional conveyance in which the grantor retains a possibility of reverter. The possibility of reverter vests automatically.
Created with durational language: “while the property is used for farming,” “during the property’s use as a farm,” “until the property is no longer used as a farm.”
Fee simple subject to condition subsequent
A fee simple subject to condition subsequent is a conditional conveyance in which the grantor retains a right of entry. The right of entry does NOT vest automatically when the condition fails. A fee simple subject to condition subsequent is created when the grantor uses conditional language, such as “provided that the property is used for farming”
Fee simple subject to executory interest
A fee simple subject to executory interest is a conditional conveyance in which a third party is granted an executory interest in the property.
Life estate
Present possessory estate limited by a person’s life, transferable and terminates upon the death of the measuring life.
Reversion
Land goes back to the grantor after the life estate terminates, grantor retains a reversion
Remainder
Possession of the land goes to a third party after the life estate terminates
Vested remainder
Given to ascertained grantee AND not subject to a condition precedent
Contingent remainder
no ascertainable grantee or subject to a condition subsequent
Tenancy in common
A tenancy in common is the default estate created by a conveyance of real property to two or more people. Each tenant in common has:
- a separate but undivided interest in the property
- the right to possess and enjoy the entire property AND
- the right to transfer their interest in the property freely during their lifetime or at death (NO right of survivorship)
Join Tenancy and Right of Survivorship
A joint tenancy is a conveyance of real property to two or more people that is distinguished by a right of survivorship, whereby the surviving joint tenants automatically take the deceased tenant’s property interest.
CANNOT pass property interest by will or intestate succession
Joint tenancy creation
Grantor: (1) makes a clear expression of intent to create AND (2) uses the survivorship language. Need four unities (time, title, interest, possession)
Joint tenant grants a mortgage interest
In a lien theory jurisdiction, the mortgage is treated as a lien and does NOT terminate the joint tenancy; in a title theory (minority view) the mortgage will terminate the joint tenancy, and the tenants will then hold the property as tenants in common
Cotenant operating expenses
Divided based on the ownership interests of each cotenant
Cotenant and rent payments
Rent payments received from a third party’s possession of the property, minus operating expenses, are divided based on the ownership interests of each cotenant
Cotenant and repair costs
Repair costs are NOT divided between the cotenants. However, the cotenant who pays for the repairs can get credit for the repairs in a partition action
Cotenant and Improvement costs
Not divded between the cotenants.
Ouster
Each cotenant has the right to possess ALL of the property, regardless of ownership share. An ouster occurs if a cotenant denies another cotenant access to the property. If this occurs, the ousted tenant can: (1) get an injunction granting access to the property;OR (2) recover damages for the value of the use while ousted
Partition
A partition is an equitable remedy that is available unilaterally to joint tenants and tenants in common. There are two types of partition actions:
(1) a partition in kind that physically divides the property into distinct portions. Courts have a preference for physical divisions
(2) a partition by sale involves selling the property and dividing the proceeds from the same among the cotenant based on their ownership interests. Courts will order a partition by sale if a partition in kind is not practicable or not fair to all parties
Tenancy for years
A tenancy for years is an interest that lasts for a fixed and ascertainable amount of time. If the term is longer than one year, then the agreement must be in writing because of the statute of frauds. A tenancy for years automatically terminates when the term expires
Periodic Tenancy
A periodic tenancy is a repetitive and ongoing interest that continues for a set period of time UNTIL it is terminated by proper notice from either party
Proper notice requires the terminating party to give notice before the start of what will be the last term. The notice is effective on the last day of the term
Parties must intent to create a periodic tenancy. Intent can be express or implied
Tenancy at Will
A tenancy at will continues until it is terminated by either party. It may be terminated at any time for any reason, and may be terminated without notice. If either party dies, the tenancy at will is terminated. Generally must be created by express agreement
Tenancy at Sufferance
A tenancy at sufferance is created when the tenant refuses to vacate the premises after his lease has terminated. This situation creates a temporary tenancy, where the terms of the prior lease control, until: (1) the landlord evicts the tenant; (2) the landlord re-leases the property to the tenant; OR (3) the tenant voluntarily vacates.
When is contractual duty to pay rent suspended?
Premises are destroyed, landlord completely or partially evicts the tenant, OR the landlord materially breaches on the lease
Implied warranty of habitability
Implied in every residential lease and requires landlords to maintain their property so that it is reasonably suitable for basic human needs. Tenant CANNOT waive.
Tenant options for breach of implied warranty of habitability
Vacate the premises and terminate the lease, withhold or reduce the rent, remedy the defect and offset the costs against the rent OR defend against eviction
Implied covenant of quiet enjoyment
Every lease includes an implied covenant of quiet enjoyment, which prevents the landlord from taking action that makes the premises wholly or substantially unsuitable for their intended purposes resulting in the constructive eviction of the tenant
Constructive eviction
SING! significant interference that made the premises unsuitable for their intended purpose, the tenant notified the landlord of the problem, the landlord did NOT correct the problem and the tenant actually vacated
Assignments
Complete transfer of the tenant’s entire remaining term under the lease. The landlord can collect rent from the assignee (privity of estate) OR the original tenant (privity of contract)
Subleases
A sublease is a transfer of less than the tenant’s entire remaining term under the lease. In a sublease, the landlord can ONLY collect rent from the original tenant (because there is privity of contract and estate). The subtenant ONLY has rent obligations to the original tenant
Surrender
A surrender terminates the lease agreement and ends the landlord-tenant relationship between both parties (releases both parties from their duties and obligations under the lease agreement). A surrender occurs when: (1) a tenant returns possession of the leased premises to the landlord before the expiration of the lease; AND (2) the landlord consents
Abandonment
An abandonment occurs when the tenant unilaterally returns possession of the leased premises before the lease expires WITHOUT the landlord’s consent. Here, the tenant will have to continue paying rent until the landlord is able to find a replacement tenant. If the tenant refuses to pay rent, the landlord is entitled to damages for the difference between the original rent and the rent received from the replacement tenant.
Duty to Mitigate
Under the majority rule, the landlord has a duty to mitigate damages if the tenant abandons the property early or is evicted by making reasonable efforts to re-rent the property to another tenant.
Under the minority rule, the landlord does NOT have to mitigate damages.
Real covenant
A real covenant is a promise concerning the use of the land that runs to successors of the promise. It typically requires the holder to either do something or refrain from doing something to the land.
Benefit of covenant to run
WITV
Burden of covenant to run
WITNVH
Equitable Servitudes
An equitable servitude operates like a real covenant with easier requirements. Main difference is the remedy! Remember that–ES is for injunctive relief. WITNES
Implied Reciprocal Servitudes
Implied reciprocal servitudes arise in planned subdivisions, Most jurisdictions impose the following: (1) intent to create a servitude on all plots (common scheme); (2) servitude must be negative (refrain from doing something); and (3) the party against whom enforcement of the servitude is sought must have actual, constructive, inquiry notice
Easement
Easement is a right held by one person to use another’s land. Created by grant or by reservation.
Implied Easement by Implication
(1) before a tract is divided, an apparent and continuous use exists on the servient part; (2) the use is reasonably necessary for the enjoyment of the dominant part; and (3) a court determines that the parties intended the use to continue
Without pre-existing use: (1) subdivision plat; (2) profit a prendre (implied easement to pass over the surface of the servient land and to use it as reasonably necessary to extract from the servient property its minerals or some product of the servient property)
Implied Easement by Necessity
(1) a single tract of land is divided by a common owner and a piece of land is conveyed to another and (2) necessity arose when the land was divided into two separate estates where one of the properties became virtually useless without the easement
Implied Easement by Prescription
(1) hostile; (2) open and notorious; (3) continuous for the statutory period. Unlike adverse possession, the use does not need to be exclusive.
Termination of easement
END CRAMP
Estoppel (servient landowner
materially changes position in reasonable reliance that easement
won’t be enforced); Necessity; Destruction of servient land;
Condemnation of servient land by eminent domain; Release (in
writing); Abandonment (phys action by holder expressing intent
never to use again); Merger (if separated again later, doesn’t
automatically revive); Prescription (servient owner interferes)
Fixtures
A fixture is tangible personal property that is attached to real property in such a manner that it is treated as part of the real property when determining its ownership.
Generally, a chattel is considered a fixture if the owner of real property intends for the chattel to become a fixture by attaching it to the real property. Such intent is judged by applying the objective, reasonable person standard that examines such factors as:
(1) the importance of the chattel to the real property
(2) whether the chattel was specially designed for use on the real property AND
(3) the amount of damage that removal of the chattel would cause to the real property
Land Sale Contract Requirement
Be in writing and signed by the party charged (SOF) and contain all the essential terms.
Exceptions to writing requirement for land sale contracts
possession, payment, improvement. Promissory estoppel or detrimental reliance will operate as a valid exception where a party reasonably and foreseeably relied on the land sale contract to his detriment and would suffer hardship if the contract is not enforced
Merger
Covenants under the land sale contract are merged into the deed and CANNOT be enforced unless the covenant is also in the deed.
Two stages:
Contract state, prior to closing any liability must be based on a provision in the land sale contract.
Deed state, after closing any liability must be based on a deed warranty.
Implied covenant of marketable title
In every land sale contract, the seller has a duty to covey marketable title to the buyer at closing. Defects:
(1) title acquired by adverse possession that has not yet been quieted
(2) future interest holders that have not agreed to the transfer
(3) private encumbrances (mortgage, covenant, option, easement)
(4) violation of a zoning ordnance
(5) significant physical defect
ALL FRIENDS ENJOY ZOOS, DUH.
What happens if there is a defect in title making it unmarketable?
Must be fixed or cured BEFORE closing. If seller cannot deliver marketable title at closing, buyer can rescind without penalty.
Purchaser may choose to waive the requirement that the seller deliver marketable title. However, seller CANNOT cancel a land sale contract for failure to deliver marketable title if the buyer chooses to waive the requirement.
Implied Warranty of Fitness and Suitability
The implied warranty of fitness or suitability applies to defects in new construction. It protects against latent defects and warrants that the new construction is safe and fit for human habitation.
In most jurisdictions, both the initial purchaser and subsequent purchasers may recover damages. In other jurisdictions, only the initial purchaser can enforce this warranty.
Duty to disclose defects
Most jurisdictions impose a duty on the seller to disclose material defects to the buyer. Material defects are defects that substantially impact the (1) value of property (2) desirability of property, or (3) health and safety of its occupants.
Equitable Conversion and Risk of Loss
Purchaser holds equitable title during the period between the execution of the contract and the closing and delivery of the deed. During this period:
(1) the purchaser is responsible for any damages to the property; AND
(2) the seller, as holder of legal title, has the right to possess the property.
Adverse Possession
COHENS
Continuous, open and hostile, exclusive, notorious, for statutory period
Valid Deed
(1) satisfy SOF; (2) identify the parties; (3) describe the property sufficiently; and (4) be delivered and accepted
Delivery!!
A deed is delivered when the grantor demonstrates a present intent to transfer the property (physical transfer of a deed is not required–present intent can be demonstrated orally). A deed is NOT delivered if the delivery is revocable. A grantor can make a valid deliver to an agent.
Deed Types
(1) general warranty; (2) special warranty; (3) quitclaim.
General warranty deed
General warranty deed provides the greatest level of protection; grantor warrants title against all defects, EVEN IF the grantor did not cause the defects
Special warranty deed
provides less title protection than general warranty deeds. Warrants titles against defects caused by the grantor
Quitclaim deed
Provide the least amount of title protection; makes no warranties as to the health of the title
Present covenants
seisin, right to convey, covenant against encumbrances
SEC
Future covenants
quiet enjoyment (grantor promises to defend against future challenges to the grantee’s title to the property), covenant of warranty (grantor promises to defend against future developments that extend into the grantee’s property boundary), covenant of further assurances (promises to do what is reasonably necessary to cure future problems with title).
Contract of sale
Before a deed is delivered, the contract of sale is signed. Under equitable conversion, as soon as the contract is signed (but before closing) the buyer’s interest is real property and the seller’s interest is personal property. Thus, the risk of loss remains on the buyer under equitable conversion, even if the seller remains in possession and control of the land.
Start recording act essay with common law
Under common law, a grantor can convey only those rights that the grantor had at the time of conveyance. Thus. common law follows the first in time first in right principle. All states have recording statutes that change the results of the common law principle
