Real Property Flashcards
What is the header statement on adverse possession?
Under adverse possession, possession for the statutory period can create title to real property.
What are the 5 ways to acquire land?
Adverse possession
Land sale contract
Security interest in land through mortgage
Deed (e.g., by gift)
Conveyance (by will)
What are the 4 elements of adverse possession?
(1) Actual and exclusive
(2) Open and notorious
(3) Hostile
(4) Continuous for the statutory period
Define actual and exclusive
Adverse possessor must use the property exclusive of the true owner and of the public although one can rent the property (and stay on it)
An adverse possessor can only gain land on the land they occupy while under color of title, where the adverse possessor was conveyed title but the deed was not valid, the possessor will claim the whole property, unless the true owner is living on a portion of the property.
If typical owner would only use property in summer, adverse possessor may also use property seasonally.
Define open and notorious
Entry must be so open and notorious that it would put a reasonable owner on notice of the trespass
Define hostile
Possession must without the owner’s consent.
Boundary dispute, ouster, and a claim of right are sufficient.
Define continuous through the statutory period and tacking.
Once the statutory period starts, the owner cannot reenter, or else the period starts over. When the period passes, the possessor can file an action to quiet title.
Tacking is allowed, where a possessor can add the time of another possessor to meet the period, so long as the two are in privity. Transfer must be voluntary; abandonment or forceful removing insufficient and restart SoL time
Define tolling/disabilities.
The Statute of Limitations will not run against a true owner who has a disability (e.g., minor, incompetent) at the inception of the adverse possession. Disabilities cannot be added.
Adverse Possession and Future Interests
Rule: Statute of limitations does not begin to run until a grantor asserts his right of rentry, because until that time, the grantee’s continued possession of the land is proper.
When Real Covenant in Play
* If an adverse possessor uses the land in violation of a real covenant, she takes title free of the covenant even if she had knowledge of it. However, if she complies with the covenant for the statutory period, she takes title subject to the real covenant.
Exam Tip – Adverse possession fact triggers
Attempted transfer of property that is ineffective and the purported new owner acts like an owner (contract fails to meet SOF, deed not property delivered, etc.)
Fact pattern includes events occurring 15 to 20 years in the past
Seasonal use of a property, such as a vacation home or hunting cabin
Building is placed over the property line and onto neighbor’s land
What is the 2 step process in a land sale contract?
(1) Land Sale Contract where the seller conveys equitable title
(2) Closing where the seller conveys legal title
Step 1: The land sale contract, which conveys equitable title. The land contract endures until Step 2.
Time in between Step 1 and Step 2
* Buyer investigates seller’s title and if defective, buyer must notify seller and give seller opportunity to cure
* Risk of loss on buyer
Step 2: Closing (where the deed passes legal title and becomes the operative document).
* Seller provides form to buyer notifying buyer of any physical defects of which seller is aware. Failure to disclose a known defect makes seller liable for defect after closing. No duty to disclose visible defects.
Step 3: Buyer records deed to protect her title against a subsequent purchaser for value.
What happens when title passes from the seller to the buyer?
The land sale contract is extinguished along with the implied covenant of marketability. Only basis for a suit after title passes is by suing on the deed and any express covenants therein.
Recall the 6 possible covenants
* Seisin
* Right to convey
* Encumbrances
* Quiet enjoyment
* Warranty
* Further assurances
What does the Land Sale Contract require and what is the exception?
A land sale contract must contain the essential terms - parties, price, and an adequate description of the party, and be signed by the party to be bound, in order to satisfy the Statute of Frauds.
Time is typically not of the essence in real estate contracts.
Exception - court may enforce an oral contract if partial performance is met
Payment + [Possession or Improvements]
Define marketable title.
The seller promises to provide marketable title at closing which is title free from reasonable doubt of litigation. The covenant is extinguished at closing and any promises merge into the deed (under the doctrine of merger).
Examples of unmarketable title
- A violation of a zoning ordinance (even if the government hasn’t imposed liability, because the government has the power to do so)
- Easement that reduces value to the buyer
- Easement that is unknown to the buyer
- A significant encroachment
- Mortgages: Exception: Seller may satisfy a mortgage at closing with the land sale proceeds.
- Liens
- Landowner with future interest on the land (e.g., possibility of reverter)
- Covenants
Examples of still marketable title
- A visible easement that is known to the buyer
- A beneficial easement to the buyer, like a utility easement
- A very slight encroachment onto an adjacent landowner’s land
- An encroachment where the owner encroached upon indicated that he will not sue on it
- An encroachment that has existed for so many decades that it has become legal by adverse possession
- Mortgage that is not satisfied by closing (because the mortgage runs with the land and will encumber the title in the hands of the buyer)
What is the rule on mortgages and the closing? What right does the seller have?
A seller has the right to satisfy a mortgage or a lien at closing with the proceeds of the sale. Thus, prior to closing, the buyer cannot claim that title is unmarketable because it is subject to a mortgage so long as the mortgage is paid off by closing.
Define the doctrine of equitable conversion
Under the doctrine of equitable conversion, equitable title passes to the buyer at the time of the signing of the land sale contract. At this time, any risk of loss passes to the buyer unless the contract provides otherwise. This means that if the property is destroyed (through no fault of either party) or if either party dies, the real property belongs to the buyer.
What must the buyer do if they determine the seller’s title is not marketable?
The buyer must notify the seller and give the seller reasonable time to cure defects, even if this requires extending the closing date, and even if time is of the essence.
If the seller fails to cure marketable title, what are the buyer’s 3 options?
(1) Rescind the contract
(2) Sue for damages
(3) Obtain specific performance (and also obtain a pro rata abatement of the purchase price)
What is the relationship between a quit claim deed and marketable title?
None. The quitclaim deed does not remove an implied covenant to provide marketable title
What option does the seller have if the buyer walks away from the contract and the seller has offered to cure?
Obtain specific performance
Exam Tip: Avoid answer choices referring to the implied covenant of marketability if the closing has passed. After deed changes hands, seller is no longer liable on this implied covenant. The seller is then liable only for express promises made in the deed.
Exam Tips - Marketable Title
- Encumbrances, such as outstanding mortgage or lien (but seller has until escrow closes to pay it off)
- Record chain of title indicating seller does not have a full interest in the property to convey
- Easement that reduces “full enjoyment” of the premises
- Use restrictions, such as real covenants
- Rule regarding visible and known encumbrances is different for the real estate contract (pre-closing) and the deed (post-closing). For real estate contracts, purchaser is presumed to have contracted to accept the land subject to visible easements (and therefore such easements do not impair marketability). For deeds, covenants against encumbrances is breached even if the grantee knew of the encumbrance.
Define a deed.
A deed is a document that serves to pass legal title from the grantor to the grantee.
If you define a deed, what are the other rules you are going to list?
What happens under doctrine of merger
What terms are required in a land sale contract
Whether oral conditions are binding when the deed is passed
What are the rules about oral conditions during the time the deed is passed?
When the grantor delivers a deed directly to the grantee, any oral conditions are not binding.
When the grantor delivers a deed to a third party, oral conditions are binding, and title will transfer only when the condition is satisfied.
What are the 3 requirements for a deed to be valid?
The 3 requirements for a valid deed are:
(1) Identification of the parties;
(2) In writing and signed by the grantor;
(3) Adequate description of the party
- No consideration is required (may be an inter vivos gift)
- Difference between conveyance by deed and a land sale contract is that in a land sale contract, consideration is required.
What are the 2 requirements for valid delivery of a deed?
(1) Words of intent to transfer land (e.g., word ‘transfer’ is sufficient; AND
(2) Acceptance (presumed).
o A deed does not have to be physically delivered; it comes down to question of intent.
o If grantor retains possession of deed, presume delivery failed. If grantee in possession of deed, delivery presumed.
o Delivery also presumed if acknowledged by grantor in front of a notary or recorded.
o Title passes immediately upon proper delivery and is then not revocable
o Recording is NEVER required for a deed to be valid
Exam Tip - Deeds and PER
All types of evidence, regardless of timing, are admissible to prove the grantor’s intent to pass title.
Ambiguities in the deed
- Insufficient description of the land: Title is not transferred.
- Description is ambiguous (rather than vague or inadequate), outside Parole Evidence will likely be admitted.
- Land description left blank: Deed is void unless grantee explicitly given authority to fill in the description.
- Name of grantee left blank: Court presumes person taking delivery has authority to fill in the name of the grantee. If the grantee fills in a name, the deed is valid.
- Delivery: If the condition is that the grantee survives the grantor indicates that the grantor does not intend to part with anything until death. Thus, there is no delivery.
What is the rule on instructions given to a third party about delivery of the deed?
- Delivery to a third party with instructions on delivering deed is sufficient
- Delivery to a third party without instructions is sufficient only if third party is the agent (lawyer insufficient)
Also recall, deeds may be effective to convey property even if recorded after the grantor’s death
Deed Delivery – Exam Fact Triggers
- Handing the deed to a third party with instructions
- Placing the deed somewhere, such as a locked box
What are the 3 main types of deeds?
(1) Quit claim deed
(2) General warranty deed
(3) Special warranty deed
What is a quit claim deed?
In a quit claim deed, the grantor makes no covenants. The grantor is not responsible for issues that arise after closing. However, a quit claim deed does not remove the implied covenant of marketable title.
What is the opening sentence on the general warranty?
A general warranty deed contains 6 covenants, which the grantor makes on behalf of himself and prior titleholders.
A present covenant is breached only at delivery while a future covenant is breached if the grantee is disturbed in possession.
o EXAM TIP
Look for a warranty deed issue where there is an undisclosed easement.
What are the 6 covenants?
(1) Seisin
(2) Right to convey
(3) Covenant against encumbrances
(4) Warranty of quiet enjoyment
(5) Warranty of title
(6) Warranty of further assurances
What are the 3 covenants breached at the time of delivery of the deed and what does each mean?
(1) Covenant of Seisin: That grantor has the interest he is conveying
(2) Covenant of the right to convey: That grantor has the right (e.g., capacity) to convey the property.
(3) Covenant Against Encumbrances: That grantor warrants there are no servitudes or mortgages on the land (even if purchaser had notice of them)
What are the 3 future covenants that are breached in the future?
(1) Covenant of Quiet Enjoyment: Grantor promises grantee will not be disturbed by someone with a third party claim
(2) Warranty of Title: Grantor promises to defend grantee should there be any lawful third party claims
(3) Further assurances: Grantor promises to do whatever is reasonably necessary to perfect title if it later turns out to be imperfect
What is a special warranty deed?
The grantor covenants against title defects created by the grantor.
What are the 2 promises in a statutory special warranty deed?
(1) Covenant of seisin
(2) Covenant against encumbrances
What is the difference between a voidable and a void deed? Listen only
A void deed will be set aside by the court even if the property passed to a BFP
* Examples: Forged deeds, deeds never delivered, issued to a nonexistent grantee, obtained by fraud
* Situation: Joint tenant forges other tenants names. Conveyance works as a severance. Buyer holds TIC w joint tenant whose signature was forged.
A voidable deed will be set aside only if the property has not passed to a BFP
* Examples: Executed by minors or incapacitated persons, and those obtained through fraud/duress/undue influence/mistake/breach of fiduciary duty.
What are the damages for title issues?
Damages awarded are the lesser of either the purchase price or the cost to defend the title
What are the damages for encumbrances?
Damages awarded are the lesser of two
Difference between contract price and value of land with encumbrance
or
cost of removing encumbrance
Defenses - listen
Defined: Defenses to breaches of covenants can include:
* Unclean hands
* Laches
* Waiver
* Note: similar to land sales contract defenses
Define recording acts.
A recording act regulates the recording of deeds and other interests in property. Recording acts also determine priority between parties claiming interest in the same property.
Under the common law, without a recording act in place, first in time, first in right, applied.
Note: If someone records a conveyance, then a BFP issue can never arise because notice would exist and BFPs must take without notice.
Which 5 instruments for interest in land does a recording act apply to?
Conveyances
Mortgages
Life estates
Restrictive covenants
Easements
What is the rule for a pure race jurisdiction?
In a pure race jurisdiction, whoever records first wins. Actual notice is irrelevant and you will not see the word notice in the act, like you do for the other two acts.
“A conveyance…is not valid against the subsequent purchaser, unless the conveyance is recorded first”
What is the rule for a pure notice act?
In a pure notice jurisdiction, the subsequent BFP who records wins.
Whichever BFP enters last, wins.
“No conveyance…shall be good…against a subsequent purchaser for value…without notice…unless the conveyance is recorded”
In a race notice jurisdiction, an individual is protected if they are a BFP and if they record first.
Language: “No conveyance…shall be good…against a purchaser for value…without notice (A), AND whose conveyance is first recorded (B)”
Look for the word “and”
What is the rule to remember regarding recording acts and donees, heirs, and devisees, and what is the exception called and define it
Recording acts do not protect donees, heirs, and devises because they don’t take “for value” unless the Shelter Rule applies.
Shelter Rule: One who takes from a BFP, will prevail against any entity that the transferor BFP would have prevailed against. In other words, the transferee “takes shelter” in the status of his transferor, and thereby “steps into the shoes” of the transferor.
What are the 3 ways to provide notice and define each?
(1) Actual - literal knowledge
(2) Inquiry - what a reasonable inquiry would have discovered, where inspecting the property is considered a reasonable inquiry step.
(3) Constructive - what a search of the chain of title (public records) would have shown
Note
- Presence of 3rd party on property sufficient
- Deed reference to unrecorded instrument sufficient
- Absence of grantor deed from chain of title sufficient, because grantee should insist on seeing it
What is a wild deed?
A wild deed is recorded but not connected to the chain of title and thus is incapable of giving constructive notice. The last person will win.
Define estoppel by deed.
If one purports to convey interest in property (that he does not own), and then he later obtains the interest, the grantor will be estopped from denying the validity of the first conveyance.
* Estoppel by deed does not apply to a transfer by quit claim deed.
Exam Tips
Exam Tip on Notice: The issue of “notice” can arise in several ways:
* Recording acts
* Sale to a BFP as a defense to an easement (especially inquiry notice)
* Equitable servitudes (including implied reciprocal servitudes)
* Real covenants (for burden to run with the land)
Also, recall on Quitclaim Deeds
Grantees are not charged with some kind of notice just because the grantor gives them a quit claim deed.
What is the general rule for conveyance by a will?
Property may be conveyed by will at the testator’s death. A will is only effective upon death.
What is ademption?
If, at the testator’s death, the testator no longer owns the specific property that was devised, the gift fails, and the planned beneficiary gets nothing.
What is lapse?
A lapse occurs when the beneficiary of a gift in a will dies before the testator.
What is the common law and modern law rule for lapse?
Under the common law, if a gift lapsed, the gift was void. Under the modern law, if a gift lapses, the beneficiary’s living descendants take the gift.
What is the majority and minority rule regarding liens or mortgages on one’s property when the will is executed?
Under the majority rule, the will must expressly provide who pays for the encumbrance.
Under the minority rule, exoneration applies, where the one who receives the estate is exonerated and does not have to pay off the encumbrance, rather the estate pays it off first.
EXAM TIP
* Intersection of wills and real property for a cross-over question.
When does abatement occur?
When the estate assets are not sufficient to pay all claims and satisfy all bequests.
What is the order of priority with respect to how gifts are abated / prioritized?
(1) Property passing by intestacy
(2) Residuary estate
(3) General legacies
(4) Specific devises and requests
How are conflicts of law treated for real property and personal property as it relatese to wills?
For real property, state in which property is located applies.
For personal property, state in which testator is domiciled at time of death applies.
Define a mortgage.
A mortgage is a financing arrangement where land is a collateral for the loan.
What 2 documents are comprised of in a mortgage?
The promissory note and the mortgage
Exception: Equitable mortgage where buyer delivers deed to lender rather than signing anything; parole evidence is allowed to show intent of parties
Define the purchase money mortgage
Borrower takes out a loan for the purpose of purchasing property.
Define the future advance mortgage
Borrower takes out another line of credit to fund a project.
What are the 2 types of mortgage theories and define both
Lien theory - mortgage is only a lien on the property, borrower can sell.
Title theory - borrower cannot sell until fully pays off loan. bank holds title.
Listen
Due on Sale Clause
o Under a due on sale clause, the lender may demand full payment of the loan if the mortgagor transfers any interest in the property without the lender’s consent.
What are the rules around mortgages and transfers including on modification
Mortgages are transferable. If a grantee assumes the mortgage, they are personally liable, and the mortgagor is secondarily liable. If the grantee does not assume the mortgage “takes subject to”, the grantee does not have personal liability.
Once a transferee assumes a mortgage, any modification done by the transferee immediately releases the original mortgagor of any liability. Thus, no one can come after the original mortgagor for a deficiency.
What is the rule around mortgages and recording acts?
Recording acts also apply to mortgages. Recording statutes protect mortgagees. If recorded, the mortgage sticks with the land. This means that the mortgagee can foreclose on the land if necessary.
In notice state, mortgagor wins if a BFP, in order to not reward the prior bank that did not record. Race Notice State, mortgagor wins if a BFP and recorded deed before prior mortgage recorded.
Define a foreclosure
A foreclosure is a forced sale of property where the proceeds of the sale are used to satisfy the outstanding debt.
Define the foreclosure rules
Foreclosure destroys all interests junior to the mortgage being foreclosed. If the proceeds are not enough to cover the debt, the lender may seek a deficiency judgment against the borrower. All junior interests must be joined as necessary parties in the action, or that party’s interest will remain on the land.
Those with senior interests are not impacted by the foreclosure. After land is sold, proceeds are paid in priority order:
(1) Attorneys fees and costs associated with foreclosure
(2) Senior interests including PPM
(3) Junior interests
(4) Mortgagor (if any excess remains)
Sub Rules
Senior lienors who did not foreclose receive no proceeds and their lien remains on the property.
PPM has priority over non-PPM who executed at the same time unless the recording act changes the result
A mortgage that is properly recorded may take priority over one that is not
Buyer at auction takes subject to the senior interest that has not been paid. The auction buyer is not personally liable on the senior debt, but sooner or later senior lien will come after the property for satisfaction.
Define equitable redemption
Under equitable redemption, before the time of the foreclosure sale, the borrower has the opportunity to pay all missed payments including plus interest.
Equitable redemption can never be waived.
Define acceleration clause
If mortgage contained an acceleration clause, the full balance of the mortgage must be paid in order to redeem the house.
Define statutory redemption
Under statutory redemption, the borrower can recover the land after the foreclosure sale if they pay the foreclosure sales price. This window is typically 6 months to a year post foreclosure sale.
What is a deed of trust?
A deed of trust is a security interest where the borrower gives a deed of trust to a third party trustee (e.g., the lender’s lawyer), and in the event of default, the lender instructs the trustee to foreclose the deed of trust by sale.
What is an installment land contract?
An installment contract occurs where a buyer makes a down payment ands pays the balance in installments, and the seller retains the title until the balance is paid off in full.
o Note: Difference between installment contract and mortgage: buyer does not receive a deed until land paid off, and vender gets forfeiture rather than foreclosure. Typically, if buyer in default, seller gets back the property and gets to keep the installment payments.
- Sale Leaseback: Under a sale leaseback, the court may determine this was a disguised mortgage.
- Equitable Vendor Lien: Seller transfers title to the buyer, and purchase price or portion remains unpaid.
What are the 4 types of present possessory interests?
Fee simple
Fee simple defeasible
Life estate
Fee tail
Define a fee simple absolute.
A fee simple absolute is a present possessory interest of absolute ownership of potentially infinite duration. The interest is devisable, descendible, or freely transferrable.
- “To A” or “To A and his heirs”
- Presumed in the absence of contrary intent (that is, the common law words “and his heirs” is not necessary). Thus, “To A” is sufficient to create the fee simple absolute.
- Freely transferable, devisable by will, and descendible through intestacy
- Future Interest in Grantor: None
- Future Interest in Third Party: None
Define a fee simple defeasible
A fee simple defeasible is a present possessory interest that is subject to forfeiture by the occurrence or non occurrence of a stated condition. There are 3 types:
Fee simple defeasible subject to a condition subsequent
Fee simple defeasible determinable
Fee simple determinable subject to an executory limitation
Define a fee simple determinable and any future interest
A fee simple determinable terminates at the occurrence of a specified event and grants in the grantor a possibility of reverter. If the event occurs, the interest automatically reverts back to the grantor. It is transferable, devisable, and descendible.
o Created by words of duration such as “so long as,” “during,” “while,” “until,” or “unless”
o Words limitation duration must be used. Grants that say “for the purpose of” and “to be used for” are mere expressions of motive.
o Transferable, devisable, descendible, but always subject to the attached condition.
o If the condition is violated forfeiture is automatic.
o Accompanying Future Interest for Grantor: Possibility of reverter
The possibility of reverter is transferable, devisable, descendible
Fee Simple Subject to Condition Subsequent
A fee simple subject to a condition subsequent is a defeasible fee in which the grantor reserves the right to enter upon the happening of a stated event. On the occurrence of this event, the grantee’s estate continues until the grantor exercises her power of termination (also called a right of reentry).
o Use of conditional words like “but if”, “provided that,” or “upon condition that”
o Conclusion on Essay: Thus, Andy’s conveyance set up a fee simple subject to a condition subsequent.
o Power of Termination
The interest retained is the power of termination, the future interest reserved by the transferor. The grantor can elect whether or not to terminate the grantee’s estate, and he may waive his right by express agreement or conduct. Inaction does not constitute waiver.
o Right of reentry
Not transferable as a gift, but they are devisable and descendible
o Note: A conveyance that contains duration (determinable) words and a power of termination should be construed to be a fee simple subject to condition subsequent.
What is a fee simple subject to an executory limitation?
A fee simple subject to an executory limitation is a conveyance subject to a condition and then passes to a third party rather than reverting to the grantor.
o “To A, but if X event occurs, then to B.”
Listen
- Notes on Construction for Defeasible Fees
o Words of desire, hope, intention do not create a defeasible fee. In each of the following, A is vested with a fee simple absolute, not a defeasible fee
“To A for the purpose of constructing a day care center.”
“To A with the hope that he becomes a lawyer.”
“To A with the expectation he uses the premise as a store.”
Define fee tail
A fee tail is a present possessory estate where inheritability is limited to lineal heirs.
Most jurisdictions have abolished this.
- Created: “to A and the heirs of his body.”
- Most Jx have abolished, and to attempt to create one results in a fee simple.
Define a life estate and what issue to raise along with it?
A life estate is a present possessory estate for the duration of one’s life. Upon the grantee’s death, the estate goes back to the granter (who retained a reversion interest).
The life tenant must not commit waste.
- “To A for life”
o Not: “To A for 50 years” or “To A for life, but in no event more than 10 years.” Both of these create a leasehold interest. - Life estate pur autre vie: Similar to a life estate but lasts for the lifetime of an identified third party (not the life tenant).
- Accompanying Future Interest
o If the future interest is held by O, it is called a reversion.
o If it is held by a third party, it is called a remainder.
What are the 3 types of waste and define each?
(1) Affirmative: Voluntary act that decreases the value of the property.
(2) Permissive: A neglectful act that decreases the value of the property.
(3) Ameliorative: unilateral act that increases the value of the property.
Duties of Life Tenant
Reasonable repairs, pay ordinary taxes up to FMV, pay interest on mortgage, pay special assessments of short duration
o Future interest holder may sue for damages, enjoin acts, or seek reimbursement if they try and repair
What are the 3 future interests for a grantor and define each and is RAP relevant?
- (1) Possibility of reverter (following fee simple determinable)
- (2) Right of reentry (following fee simple subject to a condition subsequent)
- (3) Reversion (potentially following a life estate)
o A reversion is the estate left in a grantor who conveys less than they own
Example: “To A for 99 years”
o Transferable, devisable, inheritable
o Holder can sue for waste and for tortious damage to the interest
RAP does NOT apply because all of these are vested
What are the 3 broad categories of future interests for transferees?
(1) Contingent remainder
(2) Vested remainder
(3) Executory interest
What is a contingent remainder? 2 requirements
A contingent remainder is a future possessory interest in the transferee where the interest is (1) created in an unborn or unascertainable person and/or (2) subject to a condition precedent
Unborn or Unascertained Persons
A remainder here is contingent because no one is ready to take possession if the preceding estate ends.
O conveys “to A for life, then to B’s first child.” B has no children.
“A to life, then to B’s heirs.” Both are alive, but a living person has no heirs. Thus, the remainder is contingent.
“A to life, then to B’s children who survive A.” A is still alive. B’s children have a contingent remainder.
Subject to a Condition Precedent
Condition has to be satisfied beforehand
“A for life, then, if B graduates, to B.”
B must first satisfy a condition precedent before he can take.
notes on what is abolished
Rule in Shelley’s Case - Remainders are not recognized and A takes the life estate and the remainder
Abolished
o Destructibility of contingent remainders - At common law, a contingent remainder was destroyed if it was still contingent at the time the preceding estate ended.
Abolished
- Doctrine of Worthier Title: A remainder in the grantor’s heirs is invalid and becomes a reversion in the grantor.
o Example: “To A for life, then to the heirs of O.” Here, O gets a reversion.
abolished
What are vested remainders 2 situations
Vested remainders are future possessory interests in the transferee where the transferee is a (1) ascertainable person and (2) not subject to a condition precedent
What are the 3 types of vested remainders?
(1) Indefeasible
(2) Subject to open
(3) Subject to condition subsequent
listen
(1) Indefeasibly Vested Remainder
* 100% certainty
* “To A for life, then to B.” Both people alive.
When does a class open? When does it close?
- A class is open when it is possible for others to join.
- A class if closed (that is, no one born after may share in gift) when some member of the class can call for distribution.
o Womb rule: Persons in gestation at time the class closes are included in the class. - Members of the class can call for distribution at termination of proceeding estate (death of husband who had life estate).
listen
(3) Vested Remainder Subject to Total Divestment Subject to divestment due to condition subsequent
What is an executory interest
Executory Interest is an interest in favor of a future grantee and follows a fee simple subject to an executory limitation.
what are the two types
- (1) Shifting executory interest cuts short the prior interest
- (2) Springing executory interest cuts short the grantor’s interest
What is the rule on alienation?
A court might invalidate a conveyance on public policy grounds. A restriction might be void if it violates the rule against alienation. Forfeiture restraints occur when an attempted transfer results in a forfeiture of the interest. Disabling restraints occur when any transfer is deemed ineffective.
Define the rule against perpetuities
Under RAP, an interest must vest within 21 years of the death of a life in being at the time of the conveyance.
What are the 5 areas RAP applies to?
(1) Contingent remainders
(2) Vested remainders subject to open
(3) Executory interests
(4) Option in gross or right of first refusal to purchase land
(5) Powers of appointment
listen
- RAP does not apply to certain interests because it is not possible for them to violate RAP
o Vested remainders (vest at creation) other than open
o Reversion (vests at creation)
o Possibility of reverter (vests at creation)
o Right of reentry (vests at creation) - 3 Step Approach to Assess RAP
o (1) Determine the future interest to see if RAP applies
o (2) Identify the measuring life in being and the triggering event
o (3) Analyze whether after the death plus 21 years will we know if it has vested or not.
o Violation of the Rule destroys only the offending interest.
o Example of violation – an executory interest that follows a defeasible fee, with no limit on the time within which it must vest violates RAP.
What is the general rule for all concurrent estates?
All co-tenants share the right to possession and enjoyment of the property.
What are the 3 types of joint property ownership
Joint tenancy
Tenancy in common
Tenancy by the entirety
Define all of the rules you know for joint tenancy
A joint tenancy is a concurrent estate in land with the right of survivorship; when one tenant dies, the surviving co-tenants take the property free of the deceased tenant’s interest.
Four unities are required to create a joint tenancy. Joint tenants must take their interest [PITT].
* Possession: With same right to possession.
* Interest: With identical, equal interests.
* Time: At the same time.
* Title: All joint tenants must acquire title by the same instrument or by a joint adverse possession.
A conveyance by sale or by gift severs a joint tenancy. The transferee takes as a tenant in common. A joint tenancy cannot be devised by will.
A majority of states apply the lien theory in which a mortgage does not sever the tenancy. A minority of states apply the title theory, in which a mortgage does sever a joint tenancy. A joint tenant is not held liable to a mortgage that they did not enter into.
- Partition actions, foreclosure actions, and a murder sever a joint tenancy.
- Courts are split as to whether a lease severs a joint tenancy.
listen to notes on joint tenancy
- Bar Exam – If exam identifies parties as joint tenants, this means joint tenants with the right of survivorship. Do not apply the presumption that any conveyance to two or more persons is a tenancy in common.
- At common law, joint tenancy was presumed. Modern Law: Tenancy in common presumed.
- Conclusion: Bill now owns an undivided interest in the house.
Define a tenancy in common
A tenancy in common is a concurrent estate between two or more co-tenants with no right of survivorship.
What are the attributes of a tenancy in common
- No right of survivorship
- Created by the severance of the above tenancies
- Default tenancy if nothing else was specified
- Equal right to occupy: Each co-tenant has a joint right to possession of the whole property and owns an interest in the property jointly with another.
- Equal shares are presumed but are not required.
- Co-tenant may:
o Sell
o Will
o Gift his interest
o Implication
New grantee steps in shoes of grantor - At common law, joint tenancy presumed
- Modernly, tenancy in common is presumed where there are multiple owners
Define a tenancy by the entirery
A tenancy by the entirety is a concurrent estate created only between married persons, who take as a fictitious “one person” with the right of survivorship. Some jurisdictions accept same sex marriage.
Name all rules you know about tenancy by the entirerty
- Expressly created or presumed in some states by a grant to spouses
- Recognized in 25 states, but not recognized in community property states
- Neither tenant can unilaterally convey their share to another or encumber the property
o Example: The wife cannot mortgage her interest.
o Example: Deed or mortgage executed by only spouse is ineffective. - Creditors of only spouse cannot touch this tenancy for satisfaction of the debt.
- If a conveyance to spouses is unclear as to the type of estate created, most states presume that it creates a tenancy by the entirety.
- Do not assume tenancy by entirety just because at some point the couple marries
o Rule: If a man and woman take title to the land as joint tenants prior to their marriage, their subsequent marriage does not affect the nature of their title.
o Compare: When any conveyance is given to married partners, there is a presumption of a tenancy by the entirety.
4 ways to sever a tenancy by the entirety
divorce
death
agreement
execution of a joint creditor of both the spouses
What is the possession rule for all co-tenants
Each co-tenant has the right to possess the whole property, but no tenant has the right to exclusively possess any right of the property
Define ouster
Each co tenant has the right to possess and enjoy all portions of the property. An ouster occurs if a tenant is wrongfully excluded (e.g., by a co-tenant claiming exclusive possession).
What is an ousted tenant entitled to?
an ousted co-tenant is entitled to her share of the fair market rental value of the property for the time she was wrongfully deprived of possession
what is the rule related to adverse possession
unless there is an ouster, a co-tenant cannot acquire title to the whole
does a co-tenant in exclusive possession have a duty to pay rent to the other tenants?
No
A co-tenant in possession has no duty to account to another co-tenant for the rental value of his own occupancy of the premises or any profits retained from his own use of land.
what are the 2 exceptions
the co tenant in exclusive possession must share
(1) profits from exploitations of land
(2) profits from leasing all or most of the premise to a third party
note: o A co-tenant is solely responsible for his own losses from his use of the property and may not seek contribution.
what is the rule regarding co tenants and taxes and interset on mortgage
Co-tenants are responsible for their proportionate share of taxes and mortgage interest payments.
what can a co-tenant do who is not in sole possession regarding taxes do
o A co-tenant not in sole possession who pays the taxes can compel contribution from other co-tenants.
up to what amount is a co-tenant in sole possession reimbursed regarding taxes
o A co-tenant in sole possession is reimbursed for taxes only for the amount that exceeds the rental value of the property.
what is the rule on repairs and the exception
Where a co-tenant has made payments on behalf of the property for taxes, repairs, or mortgage payments that are in excess of his pro rata share, he may seek contribution, but there is no automatic right to collect the pro rata share from the co-tenant. The co-tenant may deduct these payments from rents received or seek reimbursement “off the top” if the property is sold.
Exception: Repair is necessary and you ask other person for help and they refuse. Then you can demand payment.
listen
Effect of One Concurrent Owner Encumbering the Property
* Rule: A joint tenant may only encumber her own interest and may not encumber the interests of other co-tenants.
* Example: Mortgage or judgment lien
Duty of Fair Dealing
* Rule: General duty of fair dealing between all co-tenants
* Exam Tip – If exam raises issue where one co-tenant gets a lien that impacts other co-tenants
what rule should you always bring in co tenancy?
Waste - a co-tenant shall not commit waste
APA
affirmative
permissive
ameleriotive
define partition
partition occurs where a court orders that the property is divided or the property is ordered sold and the proceeds distributed. court will order partition if practical for the parties.
* 3 Types
o Voluntary
o Partition in Kind (preferred): Physical division
o Partition in Sale: Court forces sale and proceeds proportional
* Accounting: Each co-tenant has right to accounting and reimbursement for taxes or repairs paid in excess of his proportionate share.
Encumbrance: A co-tenant may encumber his own share of the property with a loan or judgement lien but may not encumber the share of his co-tenant.
listen exam tips
Typical joint ownership issues may include possible severance, such as an inter vivos conveyance of one co-tenant’s interest, and/or accounting issues among the co-tenants.
Essays often start with a joint tenancy that is severed resulting in a tenancy in common.
when is a tenancy created and what are the 4 types of tenancies?
A tenancy is created when an owner of land conveys to another a lesser interest in the property
(1) tenancy for years
(2) tenancy at will
(3) periodic tenancy
(4) tenancy at sufferage
define a tenancy at years as well as the termination rule
a tenancy of years is a lease for a fixed period of time
the lease naturally terminates at the end of the specified period. no notice is required.
in most states, a year to year tenancy must satisfy the statute of frauds
note
A tenancy for years ends automatically on its termination date, without either party giving notice, but may terminate prematurely when the tenant exercises a remedy for the landlord’s breach.
Example: “To T for 10 years”
define a periodic tenancy and all the rules associated with it
a periodic tenancy is a lease which automatically continues for successive intervals until either party gives notice of termination
in a year to year lease, under the common law, six months was required, in the modern law, one month is required
in a month to month lease, one month is required
a tenancy in sufferance who is held over converts into a periodic tenancy
a period tenancy can be implied where the lease mentions no duration but payment is made in set intervals
an oral tenancy for year to year violates statute of frauds
Termination
* Rule: Written notice required since it is automatically renewed.
* Death does not terminate at the death of either party
* Notice must be at least equal to length of period itself and should terminate lease at end of a period
* Holdover Tenant
* Rule
o A holder tenant remains on the premise after their lease is terminated and tenders rent.
* Implication
o Considered to have periodic tenancy with period equal to period of the previous lease.
What are the landowner’s rights when dealing with a hold over tenant?
The landlord may:
(1) Treat the tenant as a trespasser and evict
(2) Treat the tenant as a holdover tenant and renew the lease
what is the new lease period for a holdover tenant for residential and for commercial
residential - hold them a month to month no matter the terms of the original lease
commercial - hold a year to year tenant to year to year
is it ok for landlord to increase rent due on tenant who switched from being holdover tenant to having periodic tenancy?
yes
Hold tenant to increase in rent so long as it is reasonable or the tenant had notice of an increase in rent.
define a tenancy at will
a tenancy at will is created when there is a no stated duration. The tenancy can last so long as either party desires. It can be terminated at any time.
Example: “To T for as long as L or T desires”
notes on tenancy at will
Creation
* Created by express agreement or by implication where tenant takes possession with permission, but there is no specific start date or time period identified for paying rent
* Note: Unless parties agree otherwise, the payment of regular rent will be viewed by court as an implied periodic tenancy
* If lease gives only landlord right to terminate, similar right will be implied in favor of the tenant, but this will not work vice versa
what are the 4 ways a tenancy at will can terminate
(1) death of either party
(2) tenant commits waste
(3) tenant attempts to assign his tenancy
(4) landlord transfers her interest in the property or gives term lease to a third person
Define a tenancy at sufferance and discuss termination
A tenancy at sufferance arises a when a tenant holds over, or remains in possession after the termination of their tenancy. A tenancy at sufferance gives rise to a periodic tenancy.
Termination - no notice from landlord is required and lasts so long as landlord needs to decide
listen to notes on tenancy at sufferance
Landlord Options
* (1) Evict tenant
* (2) Create a periodic tenancy by accepting rent (implied acceptance), or express acceptance by telling tenant its ok to stay
Hold Over Doctrine
* The maximum tenancy that can be created is year-to-year tenancy.
* Commercial Tenants
o Commercial tenants may be held to a new year-to-year periodic tenancy if the original lease term was for one year or more.
* Exceptions – where no hold over exists
o Tenant remains in possession for only a few hours after termination or leaves a few articles of personal property behind
o Delay is not the tenant’s fault (e.g., severe illness).
o Note: In above cases, landlord cannot bind tenant to a new tenancy.
What is the tenant’s duty to repair?
The tenant must maintain the premises and make ordinary repairs, except for those for wear and tear.
The tenant must not commit waste (affirmative, permissive, ameliorative)
Fixtures pass with the land
The only defense is that the lease shifted the burden of repair to the landlord
What is the tenant’s duty to pay rent and how was it treated in the common law versus modern law?
The tenant has the duty to pay rent. In the common law, covenants in a lease were independent of each other, meaning that the landlord’s breach did not excuse the tenant’s duty to pay rent.
In the modern law, if a breach is material, one’s party’s performance may be excused after proper notice and a time to cure.
If the tenant breaches a duty and leaves the premise - what 3 options does the landlord have?
SIR
(1) Treat abandonment as a surrender
(2) Ignore - hold the T responsible for unpaid rent
(3) Relet and sue for the differences (landlord can recover all costs of reletting, unpaid rent, difference in rent)
Common law - no duty to mitigate
Modern law - duty to mitigate
what option does the landlord have if the tenant breaches and remains on property and what is the other point to mention
Ejectment action
most states prohibit self help. the landlord is not allowed to change locks, physically remove the tenant, etc.
what are the rules regarding the rent deposit
(1) Rent deposit can be held for tenant not paying rent or tenant damaging premise. illegal activity by tenant is not sufficient.
(2) landlord must put rent into escrow account
(3) landlord may not collect interest on rent
(4) one month rent is the default
(5) any clause attempting to avoid these laws is void
can you name 6 landlord duties
(1) duty to deliver possession
(2) implied covenant of quiet enjoyment
(3) implied warranty of habitability
(4) duty to repair
(5) no retaliatory eviction
(6) no discrimination in sales or leases
what is the duty to deliver possession?
Under the American rule, the landlord must put the tenant in legal possession on the first day of the lease, whereas under the British rule, the landlord must put the tenant also under physical possession on the first day of the lease.
define the ICQE - implied covenant of quiet enjoymnet
implied in every commercial or residential lease is the landlord’s promise that he nor someone with superior title will interfere with the tenant’s quiet use and enjoyment of the premise. Examples of breach include eviction or a hold over tenant in the apartment for more than a few days.
what is the rule on partial eviction as it pertains to a landlord versus someone with superior title
If the partial eviction is due to the landlord’s actions, the tenant may withhold the entire rent
if the partial eviction is due to the superior title holder’s actions, the tenant must pay for the portion retained
what is one way the IWH or ICQE can be breached and what are the requirements?
by constructive eviction - SiNG
(1) substantial interference
(2) notice and a reasonable time to cure
(3) tenant leaves - get out
tenant remedies - seek damages
define the implied warranty of habitability
implied in every residential lease is landlord’s promise that the premise will be fit for human habitation. courts apply the local housing code if one is available, or else the court asks whether the conditions are reasonably suitable for human residence. In the interest of public policy, the warranty is non waivable.
what are a tenant’s 4 options upon a breach of the warranty of habitability?
MRRR
(1) move out (as per constructive eviction)
(2) repair and deduct expenses from rent due
(3) reduce rent
(4) remain
in a sale of land, is there an implied warranty of habitability? what is the exception
No. Buyer Beware.
Exception
Sale of new home by a builder
what is the common law rule on the landlord’s duty to repair
under the common law, a landlord had no duty to repair or maintain the premises. any duty must have been provided for in the lease or required by statute
what is the modern law rule on the landlord’s duty to repair? 5 areas
under the modern law, the landlord must
(1) maintain the common area
(2) warn of any latent defects
(3) complete repairs of anything landlord assumed
(4) repair public use premises of short term duration (lease)
(5) repair furnished dwellings of short term duration
what is the rule on landlord duty as it relates to acts of other tenants
the landlord is not liable to the tenant for wrongful acts of other tenants but must abate a nuisance
what is the modern trend on reasonable duty of care and when can a landlord be held liable
the landlord owes a general duty of reasonable care toward residential tenants, and will be held liable in injuries in tort resulting from ordinary negligence if:
(1) landlord had notice of defect; AND
(2) an opportunity to repair it
note
o Legal Duty to Repair
If the landlord has a statutory duty to repair (for example, housing codes), the landlord is liable in tort for injuries resulting from the landlord’s failure to repair or negligence in making repairs.
what is the rule on retaliatory eviction and the assumption of wrongdoing?
a tenant may not be evicted or his/her lease not renewed due to the tenant’s complaint that the premises are not habitable
retaliation is assumed if the landlord takes such action within 3-6 months of the complaint
what are the 2 acts related to discrimination
Civil Rights Act of 1964
Fair Housing Act of of 1968
define civil rights act
The Civil Rights Act bars discrimination in the sale or rental of all property
define the Fair Housing Act
The Fair Housing Act protects tenants and prospective tenants from discrimination based on protected classes including familial housing (exception senior housing)
what are the 2 exemptions for the fair housing act?
(1) Owner occupied dwellings with less than 5 units
(2) single family homes where owner owns less than 4 single family homes
what are the prohibited actions under the Fair Housing Act
- refusing to rent or to sell
- providing different terms or conditions
- falsely representing that the dwelling is not available
- discriminatory advertising, for which the exemptions above do NOT apply and for which the newspaper may also be liable
- providing reasonable accommodations whereby the landlord must allow disabled tenants to make reasonable modifications to existing premises at the tenants own expense
listen - issue clusters
Exam Tips – Issue Clusters
Condition of rental premises, implied warranty of habitability, implied covenant of quiet enjoyment, constructive eviction, and possibly retaliatory eviction. Often, if one issue is present, they all will be.
define assignment - when it is occurs as well as a statement on privity of contract and privity of estate
Assignment occurs when the assignor transfers his entire remaining interest under the lease to another.
The landlord and assignee are in privity of estate with each other, and are liable to each other for all covenants the run with the land (i.e., touch and concern the land). The landlord and assignor retain their privity of contract with each other, which means the landlord may seek any unpaid rent from the assignor (though the assignee pays the rent under normal circumstances).
The path to releasing an assignor from their obligations is through a novation, where 2 parties agree to substitute one party for a new one. No writing is required.
Define a sublease - mention privity details and any other details you can think of
A sublease is the transfer of a portion of the remaining term under a lease.
Under a sublease, the sublessee is in privity of contract and privity of estate with the sublessor. The sublessor remains liable to the landlord on all covenants. The landlord remains liable to the sublessor on all covenants. The sublessor becomes the sublessee’s landlord. The sublessor remains liable for all rent payments.
o Sublessor: issues the lease
o Lessee: person lease is granted to
what is the rule on objections to assignments by landlords? by other roommates?
Another roommate has no right to contest a transfer because she is not the beneficiary of the non-assignment.
By accepting rent from the new assignee, the landlord waives any right to sue for breaching a non-assignment clause.
listen to option to purchase
o Where option to purchase is attached to a lease, the consideration for the lease supports the option. Because it is an interest in land, it must be a signed writing. The option lasts as long as the lease.
Define a fixture
Fixture is chattel that is so affixed to the land that they may be deemed part of the real estate
5 Factor Analysis to Determine If Fixture
* (1) Method of attachment
* (2) Adaptability
* (3) Removal
* (4) Intention
* (5) Agreement – Controlling Factor
what is the rule on annexed (removable) chattel
Annexed (removable) chattels must be removed by the end of the lease term and the tenant is responsible for repairing any damage caused by removal.
what is the common ownership rule
under common ownership rules, the annexor’s objective intent determines whether the items are fixtures
what is the divided ownership rule
under divided ownership cases, the item’s owner can remove it only if this would not leave unrepairable damage to the premise
what is constructive annexation?
Under constructive annexation, items not physically attached to land are fixtures if they are so uniquely adapted to the real estate that it makes no sense to separate them (e.g., keys to doors).
what are trade fixtures and the rule on them
Trade fixtures are those that are affixed to the real estate by a commercial tenant for use in business. There is a strong presumption that trade fixtures are removable. The tenant is responsible for repairing any damage resulting from its removal.
listen to exam tip
EXAM TIP
* Look for issues cluster of waste and fixtures since they are usually both present if one is. Note that the issue of waste can also arise in relation to the conduct of a life tenant.
what are the 3 types of servitudes
easement
real covenant
equitable servitude
Define an easement (first sentence)
An easement is a non-possessory interest in land granted to a third party.
Define how an easement is created.
An easement is created expressly or impliedly. While an express easement is created by grant (and must satisfy the Statute of Frauds), an implied easement can be created by prior use, implication, or prescription.
What is the first classification
An easement can be classified as affirmative or negative. An affirmative easement gives the third party a right to perform an act on the servient land (e.g., cross my driveway), while a negative easement restrict a landowner from performing an act (e.g., do not obstruct the view).
second classification
Easements may also be classified as in gross or appurtenant. An in gross easement gives an individual a benefit that is not tied to the land, and does not run with the land.
An appurtenant easement benefits a particular piece of land (i.e., the dominant estate) and burdens a piece of land (i.e., the servient estate). An appurtenant easement runs with the land.
define scope of easement
A scope includes only normal, foreseeable development. The dominant owner may not exceed the easement’s scope, or else the easement is surcharged. The servient landowner may sue for damages, though the easement will not be terminated.
define transfer of easement
When a servient parcel is transferred, the easement will run with the land unless the subsequent buyer is a bona fide purchaser. A bona fide purchaser is one who pays value and takes with no notice of the servititude.
Go into all types of recording acts
Go into all types of notice (actual, inquiry, constructive)
Go into Shelter Rule
5 ways to create an easement
(1) Expressly created through a signed writing that satisfies the Statute of Frauds
(2) Easement implied by prior use
(3) Easement by necessity
(4) Easement by prescription
(5) Easement by estoppel
Define implied easement by prior use - 4 elements
(1) Land was originally one parcel;
(2) Land severed;
(3) Use apparent and continuous such that parties would have expected it to continue once the land was divided; AND
(4) Reasonable necessity.
Define easement by necessity - 3 elements
(1) Land was originally one parcel;
(2) Land severed and became landlocked; AND
(3) Strict necessity.
Define easement by prescription - 4 elements
(1) Actual use; (recall, exclusive use not required)
(2) Open and notorious;
(3) Hostile; AND
(4) Continuous for the statutory period.
Tacking allowed.
Define easement by estoppel - 2 elements
(1) Reliance on license to detriment; AND
(2) With knowledge and consent of burdened property.
what is the rule on maintenance and repair of easements
The dominant owner has the duty to make repairs if she is the sole user of the easement. If she is not the sole user, the court will apportion repair costs based on use.
What is an easement by reservation?
An easement by reservation arises when a landowner conveys land but reserves the right to use the tract for a special purpose. This is a type of in gross easement.
(i.e., builder conveys parking lot but reserves right to use 5 spaces).
What are the 7 ways to terminate an easement? What is the mnemonic?
END CRAMP
(1) Estoppel
(2) Necessity
(3) Destruction
(4) Condemnation
(5) Release in writing
(6) Merger
(7) Prescription
define estoppel for termination
An easement is terminated when the servient owner materially changes position in reliance that the easement will no longer be enforced.
define termination by necessity
An easement by necessity ends when the necessity ends.
define termination by desctruction
Involuntary destruction of servient land ends the easement.
define termination by condemnation
Condemnation of servient estate by eminent domain.
define termination by release in writing
the dominant owner may release the servient owner of the easement provided the release is in writing
define termination by abandonment - 2 requirements
an easement is terminated by abandonment when there is an
(1) Intent to terminate; AND
(2) Physical manifestation of the intent.
Words alone or mere non use is insufficient.
Define termination by merger.
An easement is terminated when a single owner holds title to the dominant and servient parcels.
Define termination by prescription
An easement is terminated where the servient owner uses the easement without consent from the dominant holder, continuously through the statutory period
7 steps for easement essay not including BFP
Recording Acts
Notice
Shelter Rule
(1) Define easement overall sentence
(2) Identify how easements are created (4 ways)
(3) Identify first classification – affirmative or negative
(4) Identify second classification – in gross or appurtenant including transfer
(5) Discuss scope of easement
(6) Discuss repair of easement
(7) Discuss termination of easement
listen to exam tips on easements
EXAM TIP – Easement fact triggers
Right to use of an adjacent parking lot for a business
Right to use specified parking spaces
Right to use a driveway, road, or pathway
EXAM Tip – Issue Spotting
Notice (since sale to a BFP would cause an easement not to transfer), especially inquiry notice since easements are often visible upon inspection
Deed delivery
Recording acts
Warranty deeds (since an undisclosed easement would violate many of the warranties)
Define a profit
A profit entitles the holder to enter the servient land to extract resources from the servient land. Misuse of the profit will result in a surcharge. A profit generally shares the same rules as easements.
Examples: Mining minerals, drilling for oil, removing timber, hunting, fishing).
Define a license.
A license if the right to use another’s land for a specific purpose. It is freely revocable unless applies to bar revocation. Estoppel will only apply if the licensee has invested a substantial amount of money in reasonable reliance on the continuation of the license. A license is personal to the licensee and cannot be transferred.
3 situations that create a license
(1) Oral agreement of an easement produces a license, unless estoppel applies
(2) Easement not in writing produces a license
(3) Ticket cases create a license
three theories of liability to enforce a servitude
(1) Real Covenant
(2) Equitable Servitude
(3) Reciprocal Servitude Implied from a Common Scheme
Example: Cora (C) will assert three different theories: (1) that there was a covenant, the burden of which ran to Buyer (B), and the benefit of which runs to C, (2) that there was an equitable servitude, the burden of which runs to B, and the benefit of which runs to C, and (3) that a negative reciprocal servitude can be implied from a common scheme initiated by Developer (D). C will sue under a covenant theory to obtain damages in the form of the series of $600 payments, or will sue under an equitable servitude theory to require B to pay the $600.
real covenant - first theory to enforce liability
Real covenants occur when owners of property covenant to engage or refrain from certain behaviors related to the land. The usual remedy is money damages.
5 requirements for burden of covenant to run
(1) Intent for the covenant to run with the land to successors in interest;
(2) Notice;
(3) Covenant touches and concerns the land;
(4) Privity (both horizontal privity between the original parties and vertical privity between the succeeding parties; AND
(5) Covenant between the original parties in a writing that complies with the Statute of Frauds
Define intent
It must be the intent of the parties to the contract that the covenant run with the land. Intent can be inferred from circumstances or evidenced by language in the conveyance creating the covenant.
Example: The covenant stated that it applied to the grantees as well as “their heirs, successors, and assigns.”
Define notice and as us under the common or modern law
Under the common law, a subsequent purchaser was burdened with the covenant regardless of whether she had notice.
Under modern recording statutes, a purchaser of land must be on notice that the covenant exists, or else it will not be enforceable.
Successors of the burdened land who are not purchasers (for example, donees) are bound by the covenant whether or not they had notice.
define Covenant Touches and Concerns the Land
A covenant touches and concerns the land when it affects the legal relationship of the parties as landowners and not merely as members of the community at large.
define horizontal privity
original parties when entering covenant shared some interest in the land independent of the covenant
define vertical privity - complete and general
Complete vertical privity between the succeeding parties – entire property interest, nothing short of that, must be passed along to the successor in interest against whom the burden is sought to be enforced.
* General vertical privity
Vertical privity will usually be satisfied so long as the relationship between the two parties is not hostile (e.g., no adverse possession)
Exam Tip – When tested on bar exam, other VP and HP have been present and easy to establish.
define statute of frauds requirement
As will all contracts regarding real property, the contract must comply with the Statute of Frauds.
Example: For the burden to run to B, there must be a writing that satisfies the statute of frauds. Here, the original deed was properly written and recorded. Developer inserted the clause covenanting payment in all of the deeds given to the original 10 purchasers. Therefore, there is a writing satisfying the statute of frauds.
Note on writing: An equitable servitude may be created by a writing, even if one party does not sign it, so long as the party to be charged accepted the deed and recorded it, we will assume it satisfies Statute of Frauds.
4 requirements for benefit of real covenant to run
(1) Intent for the covenant to run with the land to successors in interest;
(2) Covenant touches and concerns the land;
(3) Vertical privity; AND
(4) Covenant between the original parties in a writing that complies with the Statute of Frauds
Note: Where HP is lacking, the B-1 successor can enforce the covenant against the original promisor (A), but not against the promisor’s successor.
Exam Tip: When tested on bar exam, VP present and easy to establish.
what type of remedy sought in real covenant
Rule: A breach of a real covenant is remedied by money damages.
Analysis: Because all 5 elements are met, the burden to pay the $600 for security services ran with the land from the seller to the buyer.
Conclusion: Cora may sue Buyer for damages for breach of a real covenant.
what is the rule for termination of covenants
Rule: As with all other nonpossessory interests, a covenant may be terminated by [same list as for easements]. END CRAMP and changed conditions.
what is the second theory to enforce liability and what are the 2 differences between it and a real covenant
Rule: An equitable servitude is similar to a real covenant but has two important differences. First, an equitable servitude requires a showing of intent, notice, touch and concern, and compliance with the Statute of Frauds (similar to a required showing in a real covenant). However, an equitable servitude does not require privity. Second, an equitable servitude is accompanied by a request for injunctive relief.
what is the third legal theory to enforce liability
Reciprocal Servitude Implied from a Common Scheme
define Reciprocal Servitude Implied from a Common Scheme - 2 elements
Rule: A reciprocal negative servitude can be implied from a developer’s actions where a developer develops a number of plots of land with a common scheme apparent from the development, and the grantee had notice of the covenant. Each lot owner can enforce the covenant against every other lot owner.
Note: No writing required. Constructive notice can be found if the deeds were recorded.
: Not getting money damages.
name a few legal theories to enforce the real covenant or equitable servitude or implied reciprocal servitude
An assignment or delegation is not valid
A condition has not been met
5 Equitable Defenses to Enforcement
(1) Unclean hands
(2) Laches
(3) Estoppel
(4) Acquiescence
(5) Changed Neighborhood Conditions
define unclean hands in this context
- Where person seeking enforcement is violating a similar restriction on his own land
define laches in this context
- Where the benefitted party fails to bring suit against the violator within a reasonable time
define estoppel in this context
- Rule: Where benefited party acted in a such a way that a reasonable person would believe the covenant was abandoned or waived.
define acquiescence
- Rule: Where benefitted party acquiesced to the violation of the servitude.
define changed Neighborhood Conditions
- Rule: This applies in situations where there have been drastic changes to the land and the surroundings such that it makes it unreasonable to comply with the former restrictions placed by covenants/equitable servitudes/implied reciprocal servitudes. However, this is a very high bar to establish. Mere pockets of limited change are never good enough.
listen exam tips and other
Termination and Modification of Equitable Servitudes
Same as for covenants
Exam TIP – Equitable Servitude Fact Triggers – injunction sought
Prohibition against opening a store or restaurant or competing business within a specific area
Prohibition against allowing another similar store to lease space in same shopping center
CCR’s of a condo prohibiting certain conduct, such as in artist community only allowing on-premises sale of art made in house
Covenant in an apartment lease, such as not to disturb other tenants
Subdivision owners must pay annual fee to one security company
Real covenants and equitable servitudes are very similar. On exam, typically acceptable to analyze one or the other since elements are mostly similar if the facts do not state which remedy is sought.
However, it is best to note the differences, too, such as the remedy allowed under each.
define the zoning rule
The Tenth Amendment allows states to regulate the use and development of land through zoning.
Zoning are government regulations that restrict the use of land.
2 elements to make a zoning regulation valid
(1) Reasonable; AND
(2) Substantial relation to public benefits.
2 types of zoning ordinances
(1) cumulative
(2) non cumulative
define cumulative
Cumulative ordinances create a hierarchy in the use of land. Land zones for a particular use may be used for the stated purpose or for any higher use
Example: house could be built in an industrial zone, but a factory could not be built in a residential zone)
define non cumulative
land may only be used for the purpose it is zoned
define special use permit
special use permit must be obtained even thought the zoning is proper for the intended use
It is often required for hospitals, funeral homes, etc.
define a variance
a variance is permission to depart from a zoning restriction
2 requirements for a variance to be obtained
(1) Unnecessary hardship; AND
(2) Due to unique facets of the property or practical difficulty.
Note: The harm to the neighboring areas will also be considered.
define a non conforming use
A non-conforming use is use of a property that was allowed under zoning regulations in the past but is no longer allowed
- Some statutes: Allow nonconforming use to continue
- Other statutes: Provide for termination of these uses by reasonable amortization provisions (provide time frame for owners to comply with the new zoning regulations.
what is one of the key issues to assess on an essay if zoning is brought up?
Takings - Constitutional Law Fifth Amendment
Listen
Condos, HOAs, Coops
Each owner holds a share of the condo in fee simple and she owns as a tenant in common with all of the other subdivision residents with regard to the common elements (common hallways, gym, pool, etc).
Each condo owner belongs to HOA which oversees common elements and with Board oversees rules. Each condo owner takes along with the restrictive covenants (CC&R)
CC&R “Covenants, conditions and restrictions”: HOA rules or restrictions on each owner’s use of their property.
Each owner has to pay annual dues to HOA used for maintenance of common elements, and if monthly fees not enough to cover operational expense, a one time fee is assessed (a Special Assessment)
Coop – Mortgage is on the entire building. Each coop owner has shares in the company. Each owner does not pay the mortgage, they pay fees to the company which pays the mortgage.
what is the general rule for ownership of land and those types of rights
An owner of real property has the exclusive right to use and possess the soil, surface, and airspace of the property.
what is the rule for interference with sublateral support of the land in its natural state
Rule: A landowner is strictly liable for harm to land while in its natural state.
what is the rule for interference with sublateral support of the land in its non-natural state
Improved Lands
* Rule: Liability may arise when one interferes with another’s sublateral property rights. In cases where a neighbor excavates and causes a disturbance in their neighbor’s sublateral support for their property, the neighbor whose property was damaged may have a cause of action under either a negligence theory or a strict liability theory. Which theory applies depends on whether or not the claimant can show by clear and convincing evidence that her property and the weight of her buildings did not contribute to the damage. That is, there would have been damage regardless of whether or not her buildings were constructed. If the claimant can show that his buildings/improvements did not contribute to the ultimate injury, he can make out a claim for strict liability. If the claimant cannot make this showing, he must make out a case in negligence.
What is the rule for subjacent support
Underground occupants (e.g., miners), liable for negligence for any harm caused.
3 types of water
watercourses (streams, river, lakes)
surface waters (snow, seepage)
water beneath surface (water from wells)
2 theories for one’s use of watercourses and which is majority
(1) Riparian
(2) Prior appropriation
define riparian doctrine
Under the Riparian doctrine, water belongs to those who own the land bordering the waterhouse. Riparians have right to reasonable use of water and is only liable if her use unreasonably interferes
define prior appropriation doctrine
minority rule - used in CA
water belongs to the state, can be obtained by permit, allocation of water is first in time first in right no matter what the use is
rule for surface waters
A landowner can use surface waters within their boundaries for any purpose they desire.
Examples: Rainfall, melting snow, seepage that has not settled in anywhere
3 theories of rights to use surface waters - which is majority rule and define
common enemy approach where owner can take and protective measure to get rid of surface water or combat its flow (e.g., build dam) so long as not unnecessary damage to others lands
listen to 2 other theories
- (2) Natural flow theory: Owners cannot alter natural drainage patterns.
- (3) Reasonable use doctrine: Allows owner to act reasonably. Balancing the utility of the use against the gravity of the harm.
define rule for water beneath surface
A surface owner may make reasonable use of water from beneath the surface of land
what is the rule for right to airspace
right to airspace is not exclusive but the owner is entitled to freedom from excessive noise
right to exclude define
The possessor of land has the right to be from trespass and nuisance.
define trespass - 2 elements
(1) Land is invaded by a tangible physical object; AND
(2) That interferes with the claimant’s right of exclusive possession.
define private nuisance - 2 elements
Private nuisance occurs when
(1) Landowner invaded by intangibles; AND
(2) Substantially interferance with his use or enjoyment of her land.
public nuisance - 2 elements
Public nuisance occurs when
(1) Invasion of intangibles; AND
(2) Unreasonable interferance with the health, safety or property rights of a broad segment of the community
rule for when recovery is available on a public nuisance claim asserted by an individual - 2 requirements
(1) Suffered unique damage; AND
(2) That is not suffered by the public at large.
listen to notes on nuisance
Interference is substantial when it would be offensive to an average person in the community, as opposed to the plaintiff’s hypersensitivity.
Interference is unreasonable when the severity of the inflicted injury outweighs the utility of the defendant’s conduct. To make this balancing determination, courts take into account the neighborhood, land values, existence of alternatives to the defendant., etc.
what is key cross over issue with a nuisance question
takings - con law - fifth amendment
listen to exam tips
- EXAM TIP
Profits, licenses, water rights, and the right to lateral and subjacent support are infrequently tested but have been tested recently.
Exam Tip
Nuisance, inherently dangerous activities, negligence, and strict liability can all come up on the same essay. A nuisance question. And then negligence or strict liability for sublateral support issues. - If essay raises issue of land support, you may need to go through a negligence analysis too if land collapses that may not have collapsed in its natural state.
listen to remedies
- Where a party breaches a land-sale contract, the non-breaching party may recover:
Compensatory damages for any foreseeable harm. Must show causation, certainty, foreseeability, and unavoidable damages
Specific Performance. Must show (1) inadequate legal remedy, (2) definite and certain contract terms, (3) feasibility of enforcement, (4) mutuality of enforcement, and (5) lack of defenses
Injunction where there is interference with one’s property rights. Must show: (1) inadequate legal remedy, (2) property right, (3) feasibility of enforcement, (4) balance of hardships, (5) lack of defenses.
Defenses include: unclean hands, laches, freedom of speech, freedom of association.
Failure to meet a condition
Failure to disclose material fact
