Real Property Flashcards

Question 1

Q

Inter-Vivos Gift

Answer

A

Inter-Vivos Gift
A voluntary transfer of property by one to another without consideration. Once made it is irrevocable if it has donative intent, delivery, and acceptance of the gift.

Question 2

Q

Fee Simple

Answer

A

Present Possessory Estate
A property is held in fee simple absolute if it is fully under the control of the individual, with no interests of reverter or reentry. Property owned in fee simple absolute may be freely transferred according to the wishes of the property owner. A property owner may transfer party of the their property pursuant to a valid deed, creating two estates.

Question 3

Q

Fee Simple Determinable

Answer

A

Fee Simple Determinable
Property automatically terminates and reverts back to the grantor upon the happening of a given event or condition. Absolute restraints on alienation are void. (i.e. To A so long as he practices law – If A stops practicing law, property automatically reverts back to grantor). Grantor retains a possibility of reverter. If the conveyance was invalid due to an absolute restraint on alienation then a fee simple absolute is conveyed.

Question 4

Q

Fee Simple Subject to Condition Subsequent

Answer

A

Fee Simple Subject to Condition Subsequent
A fee simple subject to condition subsequent is created by granting land but reserving the right to terminate the estate upon the happening of a stated event. If the event or condition occurs, the grantee still retains the title until the grantor takes some action to exercise his right of reentry. Clear durational language must carve out a right of reentry for grantor (i.e. to A, but if he wins the lottery, grantor reserves the right of reentry for grantor).

Question 5

Q

Fee simple subject to Executory Interest

Answer

A

Fee simple subject to Executory Interest
A fee simple subject to executory interest is a fee simple estate automatically transfers to a third party upon the happening of a given event or condition. Absolute restraints on alienation are void. (e.g. To A but if A is ever arrested, to B).

Question 6

Q

Life estate

Answer

A

Life estate
A life estate is a present possessory interest in the land for the life of the being. The person with the life estate is known as the life tenant and is responsible for interest on mortgage and taxes. They also must not commit waste. A remainder is a future interest in a third person, other than the grantor, that arises immediately upon the termination of the life estate. A life estate is alienable, devisable, and descendible. A remainder that automatically becomes possessory upon the natural expiration of the preceding estate is vested. A vested remained subject to open is only if there is a class of takes. The class closes if one member calls for their share.

Question 7

Q

Concurrent Estates
Tenancy by the Entirety

Answer

A

A marital estate that can only be created between married partners who share the right of survivorship. Special protections include creditors of one spouse cannot reach the tenancy and a unilateral conveyance by one is invalid

Question 8

Q

Concurrent Estates
Tenancy by the Entirety
Termination

Answer

A

Termination
The right of survivorship may be severed by death, divorce, mutual agreement, or execution by a joint creditor. It cannot be terminated by involuntary termination.

Question 9

Q

Concurrent Estates
Tenancy in Common

Answer

A

Tenancy in Common
A tenancy in common is the default estate created by a transfer of real property to two or more people. Each co-tenant owns an individual part, with the right to possess and enjoy the whole. The interest is descendible, devisable, and transferable. There is no right of survivorship. To sell, mortgage, lease, or otherwise transfer all or part of the interest in the property without consent of the other co tenants does not terminate the tenancy in common. Modernly, tenancy in common is presumed unless the right of survivorship is clearly expressed.

Question 10

Q

Concurrent Estates
Joint Tenancy

Answer

A

Joint Tenancy
A joint tenancy is an estate in land held concurrently by two or more co-tenants. The feature that distinguishes a joint tenancy from a tenancy in common is the right of survivorship. When one joint tenant dies, the surviving co-tenants automatically take the property free of the deceased tenant’s interests. The interest is transferable(alienable) but not devisable or descendible.

Question 11

Q

Concurrent Estates
Joint Tenancy
Creation

Answer

A

Creation
At common law, four unities are required to create a joint tenancy: the unities of time, title, interest, and possession. This means the interest must have vested at the same time, have been acquired by the same instrument, be of the same type and duration, and give identical rights to enjoyment. The grantor must make a clear expression of the intent to create the right of survivorship.

Question 12

Q

Concurrent Estates
Joint Tenancy
Severance

Answer

A

A joint tenancy can be terminated by sale, partition, or mortgage. One joint tenants unilateral sale creates a tenancy in common. i.e. a joint tenant’s inter vivos conveyance of his undivided interest destroys the joint tenancy, and the transferee takes as a tenancy in common. Partition may be voluntary or involuntary. Partition in kind is the physical division of the property. A partition may also be a forced sale(court action) and the proceeds divided proportionately

Question 13

Q

Concurrent Estates
Joint Tenancy
Severance
Effects of Mortgage

Answer

A

Effects of Mortgage
The effect of one co-tenant mortgaging her interest, depends on how mortgages are characterized in that jurisdiction. In the majority of states, a mortgage is regarded as a lien on title; thus, one joint tenant’s execution of a mortgage on her interest does not by itself cause a severance. However in the minority of states, a mortgage is regarded as a transfer of title, which destroys the unity of title, severing joint tenancy thus the co-tenants hold the property as tenants in common.

Question 14

Q

Concurrent Estates
Rights and Duties of CoOwners

Answer

A

Each co-owner has the right to use and enjoy the whole.
1. Rent payments
2. Repairs
3. Improvements
4. Taxes and Mortgages
5. Profits
6. Waste

Question 15

Q

Concurrent Estates
Rights and Duties of CoOwners
Rent Payment

Answer

A

Rent Payments
A tenant in possession need not reimburse her co-tenant for the rental value of her use of the land unless there has been an ouster. An ouster occurs if one tenant wrongfully excludes another from possession of the premises. An ousted co-tenant is entitled to receive his share of the fair rental value of the property for the time he was wrongfully deprived of possession. Rent income by 3rd party is equally divided by owners. *If ousted, do adverse Possession

Question 16

Q

Concurrent Estates
Rights and Duties of CoOwners
Repairs

Answer

A

Repairs
A co-tenant who pays more than her pro rata share of the cost of reasonable and necessary repairs is entitled to contribution from the other co-tenants in actions for accounting or partition, provided they notified the other cotenants of the need.

Question 17

Q

Concurrent Estates
Rights and Duties of CoOwners
Improvements

Answer

A

Improvements
A co-tenant who has made improvements has no affirmative right to contribution unless there is a partition. They are liable for the decrease in the property value (Ameliorative Waste).

Question 18

Q

Concurrent Estates
Rights and Duties of CoOwners
Taxes and Mortgages

Answer

A

Taxes and Mortgages
Each co-tenant has a duty to pay her share of taxes and payments due on mortgages on the entire property. A tenant who is not in sole possession can pay the taxes and then compel contribution from the other co-tenants. However, a co-tenant in sole possession will receive reimbursement only for the amount that exceeds the rental value of the property.
*exp. here, bill paid all the taxes on the house; however, he was in sole possession as well. As a result, Bill will have a claim against Executor for reimbursement only if Bill paid more in taxes than the rental value of the property.

Question 19

Q

Concurrent Estates
Rights and Duties of CoOwners
Profits

Answer

A

Profits
Co-tenant in possession has a right to retain profits from their own use of the property. However, a co-tenant out of possession has a right to share in net from third party renters and net profits from exploitation of the land.

Question 20

Q

Concurrent Estates
Rights and Duties of CoOwners
Waste

Answer

A

Waste (Voluntary, permissive, ameliorative)

A co-owner must not commit waste. An action for waste resides during the life of the ownership, they do not have to wait for partition.

Voluntary - Willful destruction
Permissive - neglect
Ameliorative - nonconsensual changes that enhance value.

Question 21

Q

Land Sale Contracts: Process

Answer

A

When parties convey land it is a two step process: first the parties enter into a contract for the sale of land and then there is a period of escrow. Following escrow, closing occurs in which the land sale contract merges into the deed, the deed is delivered and at that point finished.

Often tested with marketable title, breach of warranty combined with easements, equitable servitudes and real covenants.

Question 22

Q

Land Sale Contract

Answer

A

A contract for conveyance of an interest in real property governs until time of closing at which time deeds become operating document under the merger doctrine. The land sale contract generally specifies the time of closing. If one party fails to perform on the date specified in the contract, it generally is not a problem so long as performance is rendered within a reasonable time (i.e. two months).

Question 23

Q

Land Sale Contract
Contract law Requirements

Answer

A

Contract law Requirements
A valid k for land sale must satisfy the Sof. To satisfy the SoF it must be in writing, identifying the parties, signed by the party to be bound, with a description of the land and with consideration. However, promissory estoppel and partial performance may be valid exceptions to the writing requirement.
Description- Must be unambiguous of where the property is defined.

Question 24

Q

Land Sale Contract
Contract law Requirements
Ambiguous Clause

Answer

A

Ambiguous clause
When the parties’ intent cannot be determined from the evidence, an ambiguous clause will render the entire contract void for indefiniteness.

Question 25

Q

Land Sale Contract
Contract law Requirements

Exception: Doctrine of Part Performance

Answer

A

Doctrine of Part Performance
Equity will decree specific performance of an oral k for the sale of land if at least 2 of the following are performed: if the buyer takes possession; pays all or part of the purchase price, and/or makes substantial improvements.
(value as a whole, how much paid thus far, how people are behaving- as a true owner might do)

Question 26

Q

Land Sale Contract
Contract law Requirements

Exception: Promissory Estoppel

Answer

A

promissory estoppel
Promissory estoppel operates as a valid exception where a party reasonably and foreseeably relied on the land sale k to his detriment and would suffer hardship if the contract is not enforced.

Question 27

Q

Land Sale Contract
Contract law Requirements
Equitable Conversion - Risk of Loss

Answer

A

During escrow (after land sale contract but before deed delivery), buyer has interest in the real property, but seller has interest in the personal property (the right to proceeds of the sale). The seller holds legal trust for buyer. If the property is destroyed before closing through no fault of the parties, buyer bears the risk of loss. The parties may contract differently. The seller must credit any insurance proceeds from loss against the purchase price. Some states have statutes that provide opposite results or risk of loss can be contracted for.

Question 28

Q

Land Sale Contract
Contract law Requirements
Equitable Conversion - Risk of Loss
Party Dies

Answer

A

Party Dies
The contract will proceed if a party in the transaction dies.

Question 29

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title

Answer

A

Promise of Marketable Title usually tested as encumbrances
In every land sale k, the seller has a duty to convey marketable title to the buyer at closing. Marketable title is title that is free from reasonable doubt and from an unreasonable risk of litigation. Defects that render title unmarketable are: title acquired by adverse possession that has not yet been quieted; future interest holders that have no agreed to transfer; private encumbrances; violation of zoning ordinance; or significant physical defect. To provide marketable title, the seller must provide buyer with (1) proof of title, (2) title free on encumbrances, (3) and valid legal title as of the date of closing. *title is encumbered when there is an undisclosed easement, covenant or mortgage or someone owns an option to purchase an easement etc, An easement that benefits the burdened estate, and is visible or known to the buyer does not render title unmarketable.

Question 30

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
-Defect in Title

Answer

A

Defect
If there is a defect in title rendering title unmarketable, it must be fixed or cured before closing. If seller cannot deliver marketable title then buyer can rescind the k without penalty or may waive the requirement.

Question 31

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
Promise to Not Make Any False Statements of Material Facts

Answer

A

Promise to Not Make Any False Statements of Material Facts
Most jurisdictions impose a duty on the seller to disclose latent material defects or material lies or material defects to the buyer. Material defects substantially impact: value of the property; desirability of the property; or health and safety of the occupants. A defect may be disclaimed if clear and specific.

Question 32

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
Promise to Not Make Any False Statements of Material Facts

Caveat Emptor

Answer

A

Caveat Emptor
Buyer beware. You can buy whatever you want. A General Disclaimer of liability ‘AS IS” will not excuse efforts of concealment or fraud.

Exception: Builder/Vendor
Generally, a conveyance of real property contains no warranties of quality or fitness for the purpose intended, but there is a recognized exception for the sale of a new house by the builder. There is an implied warranty that the new house is designed and constructed in a reasonably “workmanlike” manner and suitable for human habitation. Thus, in this case, the buyer would appear to have no claim against the seller unless he was the builder, in which case she could claim that the house was not constructed in a reasonably “workmanlike” manner

Question 33

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
Promise to Not Make Any False Statements of Material Facts
Caveat Emptor

Remedy for Breach of Land Sale K

Answer

A

The buyer must notify seller before closing and give reasonable time for seller to cure defects. If buyer fails to notify seller before closing, contract merges with the deed and seller is not liable.

If seller fails to cure, buyer can:

1) Rescind
2) Seek Damages – a non-breaching party to a land sale contract may recover the difference between the contract price and the value of the property at the time of breach.
3) Demand Specific Performance (SP) – permanent injunction where court orders D to perform contract as promised- Usually preferred because real property is unique
- Requirements for SP –(A) K is valid
(b) K conditions imposed on the P is satisfied (c) Inadequate legal remedy (d) property unique
(e) Mutuality of performance – both parties must be eligible to have their performance under K ordered by court (f) Injunction cannot be too difficult for court to enforce
(g) No defenses such as laches/unclean hands, or any defenses to underlying K
(4) File suit to quiet title

Question 34

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
Promise to Not Make Any False Statements of Material Facts
Caveat Emptor
Remedies for breach of Land sale K

Merger Doctrine

Answer

A

Merger Doctrine
Covenants under the land sale contract are merged into the deed and cannot be enforced unless the covenant is also in the deed. Prior to closing any liability must be based on a provision in the land sale contract. After closing, any liability must be based on a deed warranty.

Question 35

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed

Lawfully Executed

Answer

A

Lawfully Executed : in writing, contain words of conveyance, signed by grantor, identifying parties, describing the property

Question 36

Q

Land Sale Contract
Contract law Requirements
Promise of Marketable Title
Promise to Not Make Any False Statements of Material Facts
Caveat Emptor
Remedies for breach of Land sale K
Merger Doctrine

Deed Transfer By Deed

Answer

A

DEED- Transfer by deed
Deed passes legal title to the buyer. It must be lawfully executed, delivered and accepted by the grantee.
 Lawfully Executed : in writing, contain words of conveyance, signed by grantor, identifying parties, describing the property

Question 37

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed

Delivered

Answer

A

 Delivered : present intent to be bound irrespective of whether or not the deed itself is delivered. It is permissible to use mail, or an agent. If there is a deed with an oral condition, the oral condition does not apply. Look at the control grantor continues to have, and that it is not just a life estate built in.
Courts recognize that a valid and binding gift can be made where the grantor retains a life estate and possession of the gift, with a present remainder interest being conveyed to and vested in the grantee.

Parol evidence allowed to prove intent:
a. The following create a strong presumption of present intent to transfer:
1. Recording the deed
2. Grantor physically delivering deed to grantee

Question 38

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed

Accepted by Grantee

Answer

A

 Accepted by Grantee : The recipients’ express rejection of the deed will defeat delivery. Once the conditions of escrow are met, title passes to the grantee.

Question 39

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed

Deed Types

Answer

A

Deed passes legal title to the buyer. There are 3 types of deeds: Quitclaim deed, General Warranty, & statutory warranty deed. Head note for deed we address

Question 40

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Quitclaim

Answer

A

Quitclaim
No covenants of title are included or implied. Releases whatever interest the grantor has. This provides the least amount of title protection.

Question 41

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Statutory Special Warranty Deed

Answer

A

Statutory Special Warranty Deed
Some states enforce promises by statute. The two promises are made by the grantor only on behalf of himself(not any predecessor grantor). Promise 1) he has not conveyed estate to anyone other than grantee and 2) the estate is free from encumbrances made by the grantor.

Question 42

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

General warranty

Answer

A

General warranty
Is the best deed a buyer can hope for. The grantor warrants title against all defects, even if the grantor did not cause the defects. It typically contains 6 covenants.

Question 43

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Present Covenants

Answer

A

Breached if ever at the time of delivery. the SoL for breach starts to run at the time of delivery. Remedy of breach is damages.

Seisan
Right to Convey
Against Encumberances

Question 44

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Present Covenants
Seisan

Answer

A

Seisan -
the grantor warrants that grantor owns the estate and no other person has a conflicting present or future possessory interest.

Question 45

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Present Covenants
Right to convey

Answer

A

Right to convey -
Warrants grantor has the right to convey, this means no temporary restraints, and is under no legal disability.(prevents conveyance)

Question 46

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Present Covenants
Against encumbrances

Answer

A

Against encumbrances -
warrants there are no visible or invisible encumbrances such as servitudes or mortgages, against the title or interest conveyed. . If mortgage will be satisfied by the closing of the contract then it does not effect the covenant against encumbrances. This also may be a breach of seisan or right to convey. Covenant considered breached even if buyer had notice of encumbrance.

Question 47

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Future Covenants

Answer

A

Future Covenants -
Not breached if ever until grantee is disturbed in possession (ouster). SoL runs upon breach. Must tell grader when sol begins to run. Remedy for breach is purchase price+interest.

Quiet Enjoyment
Warranty
Further Assurances

Question 48

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Future Covenants
Quiet Enjoyment

Answer

A

Quiet Enjoyment – Only if claim is about title to property, claim for nuisance would not apply.
Grantee won’t be disturbed in possession by 3rd party’s lawful claim of title.

Question 49

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Future Covenants
Warranty

Answer

A

Warranty –
Grantor promises to defend against lawful claim of title. (future developments that extend into the grantee’s property boundary.) Furthermore, liability on the covenant of warranty or for further assurances does not arise unless the party claiming breach gives the covenanting party notice of the claim against the title she conveyed.

Question 50

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types
General warranty

Future Covenants
Further assurances

Answer

A

Further assurances –
Grantor promises to do whatever is needed in the future to perfect title.

Question 51

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title

Answer

A

if a prior conveyance or interest is not recorded, a subsequent purchaser/mortgagee may be protected under a recording statute Recording acts apply to every instrument by which an interest in land can be created or modified or can be recorded, including conveyances, mortgages, life estates, restrictive covenants, easements, etc.

First in Time, First in Right
Recording Statutes
Bona fide Purchaser

Question 52

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
First In Time, First In Right

Answer

A

First in Time, First in Right
Under common law, if a grantor transfer the same piece of property to multiple grantees, the first grantee to receive the deed acquires rightful title. In the absence of a recording statute, the common law rule controls.
However, every state has adopted a recording statute that modifies the common law rule. The concept of notice is crucial to apply these modified recording statutes.

Question 53

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes

Answer

A

Recording Statutes (mostly only relevant when subsequent purchasers involved)
There are three types of recording statutes that have been adopted by states to resolve competing claims to title. They are: Race statutes; notice statutes; race-notice statutes.

Question 54

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Race Statutes

Answer

A

Race statutes .(look for “Records first”)
The first purchaser for value to record acquires title, regardless of notice. Good faith not req

Question 55

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Notice Statutes

Answer

A

Notice Statutes ( look for “good faith” or “for value”)
A subsequent BFP acquires title if the purchase is made without notice of the prior conveyance.

Question 56

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Race Notice Statutes

Answer

A

Race-Notice statues ( look for a combination of “record first” and “for value”)
A subsequent BFP acquires title if: the purchase is made without notice of the prior unrecorded conveyance; AND the subsequent purchaser records first.

Question 57

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Bona Fide Purchaser

Answer

A

Bonafide purchaser
To be a bona fide purchaser one must purchase the property for value (substantial pecuniary consideration), and without notice. The three types of notice: Actual notice, constructive notice and inquiry notice.

Question 58

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Bona Fide Purchaser
Actual Notice

Answer

A

Actual notice
A subsequent purchaser has actual notice when he has personal knowledge of the prior interest.

Question 59

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Bona Fide Purchaser
Record Notice

Answer

A

Record notice
A subsequent purchaser is on record notice when the prior interest is properly recorded. (valid recordation puts entire public on notice).

Sub issue: Wild deed
If a deed is not recorded properly, it is considered a wild deed. This does NOT put the subsequent purchasers on constructive notice.

Question 60

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Bona Fide Purchaser
Inquiry Notice

Answer

A

Inquiry notice
A subsequent purchaser has inquiry notice when a reasonable investigation would have revealed the existence of prior claims (eg someone clearly living on property in question). If another person is in possession then the buyer has inquiry notice regardless whether they investigated.

Question 61

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Recording Statutes
Bona Fide Purchaser
Inquiry Notice
-Shelter Rule

Answer

A

Shelter Rule
One who takes from a BFP will “stand in the shoes” of BFP and prevail against any claim the BFP would have prevailed against, even if the transferee had actual notice of a prior conveyance
Protects donees, heirs, or devisees of BFPs who do not qualify as BFPs and not receive protection under recording statutes (because they are not purchasers for value)

Question 62

Q

Land Sale Contract
Merger Doctrine
Transfer By Deed
Deed Types

Competing Claims to Title
Estoppel By Deed

Answer

A

Estoppel by Deed – TRICKY TRICKSTER
A grantor who conveys unowned property by warranty deed is estopped from subsequently acquiring the same land.
-Title automatically passes to the benefit of grantee, who can accept or reject the transfer.
–Prevents one from conveying land they do not presently own & later validly acquire (like through will)
—Estoppel by deed does not apply to transfer by quitclaim deed.

Question 63

Q

Landlord – Tenant (Non-Freehold estate)

Answer

A

1) tenancy for years
2) periodic Tenancy
3) tenancy at Will
4) tenancy at sufferance - holdover doctrine

Question 64

Q

Landlord – Tenant
Tenancy for Years

Answer

A

A tenancy for years is a leasehold estate for a fixed, determined period of time; ends automatically at termination date and notice is not required. If the term is greater than 1 year then the agreement must be in writing to satisfy the statute of Frauds.

Answer 65

A

An agreement for interest in real property must be in writing and signed by the person to be charged in order to be enforceable.

Answer 66

A

Periodic Tenancy *holdover tenant creates implied periodic tenancy
A periodic tenancy is a repetitive and ongoing interest that continues until it is terminated by proper notice from either party. The periodic tendency is measured by the payment of rent in specific intervals. The parties must intend to create this interest by: express agreement, implication, or operation of law.(“week to week” “month to month”, ”year to year”)

Answer 67

A

Express
Specified terms of the lease agreement or agreement.

Implied
Land is leased with no mention of duration, payments are made in successive intervals. Or an oral agreement in the term of years that violates SOF.

Answer 68

A

Holdover
A periodic tenancy can arise by implication if the landlord elects to holdover a tenant who has wrongfully stayed past the conclusion of the lease. This tenancy is measured by the way rent is tendered.

Answer 69

A

Proper Notice- Termination
Written notice is required to terminate a periodic tenancy since it is automatically renewed in the absence of notice of termination. At common law, notice must be in accordance with the length of the time period of the lease, except if the lease exceeds 6 months (180 days), only 6 months notice is required. Can agree to lengthen or shorten notice time so long as reasonable.

Answer 70

A

Tenancy at Will
A tenancy at will is a lease for no fixed period of duration and terminable at will of either landlord or tenant; and requires express agreement that the lease may be terminated at any time. There must be a reasonable demand and time to vacate.
-Regular payments of rent will cause a court to treat it as an implied periodic tenancy.

Answer 71

A

Tenancy at Sufferance – Holdover doctrine
A tenancy at sufferance is created when the tenant has wrongfully held over past the expiration of the lease. The landlord has the election to either move to lawfully evict the tenant or decides to hold the tenant to a new periodic tenancy.

*apply periodic tenancy if tenant makes payments

The landlord must not engage in self-help to remove the tenant.

Answer 72

A

Tenant Duties
Tenant has a duty to maintain the premises and pay rent.

1) Liability to 3p
2) Duty to repair where lease is silent
i) Fixtures/improvements
ii)Trade fixture
iii) Waste
3) Duty to Pay Rent
i) T breaches but still in Possession
ii) T breaches but NOT in Possession

Answer 73

A

Liabilities to Third Parties
Tenant is liable for injuries sustained by third parties, that tenant invites even where the landlord promised to make repairs.

Answer 74

A

Tenant must maintain the premises and make ordinary repairs. Tenant must not commit waste.

Answer 75

A

Fixtures/Improvements
A fixture is a once removable chattel that by virtue of its annexation to realty, objectively shows the intent to improve realty, unless an agreement is made otherwise. Fixtures pass with the ownership of land. When Tenant removes a fixture tenant commits voluntary waste. However, Tenant may remove chattel as long as removal doesn’t cause substantial harm to premises or is a trade fixture.

Answer 76

A

Trade Fixture
Chattel affixed to the property by commercial tenant for use in business. There is a strong presumption that trade fixtures are removable. Tenant is responsible for repairing any damage resulting from its removal.

Answer 77

A

Waste
The tenant must not commit waste.
Affirmative or voluntary waste is actual or overt destruction.
Permissive waste or neglect is a failure to protect or preserve land.
Ameliorative waste is a change that economically benefits property but w/out consent of land owner & future interests.

Answer 78

A

Duty to Pay Rent
Tenant breaches the duty to pay rent but is still in Possession

The landlord can proceed against the wrongdoer through lawful eviction proceedings or the landlord can continue the relationship and sue for rent owed. If the landlord moves to evict, they are still entitled to rent from the wrongdoer, now a tenant at sufferance, until the tenant vacates. Landlord must NOT engage in self-help.(no changing locks or moving possessions)

Answer 79

A

Breach of covenant
With the exception of the covenant to pay rent, covenants in a lease are independent of one another. If one party breaches a covenant, the other party can recover damages but still must perform.

Answer 80

A

Tenant breaches the duty to pay rent but is NOT in Possession

The landlord has three remedies if the tenant is no longer in possession of the premises with time still left on the lease.

S Surrender- Landlord can treat the abandonment as surrender, which is when tenant shows by words or conduct that they want to give up the lease. If lasting greater than 1 year must be in writing.

I Ignore the abandonment and hold the tenant liable. Minority of states allows the landlord to do nothing & let damages accrue.

R Re-let the premises on the wrongdoers behalf, holding wrongdoer liable for any deficiencies. LL reas. goodfaith attempt to re-let.

Answer 81

A

Duty to deliver possession
Implied Covenant of Quiet Enjoyment
i. Actual Eviction
ii. Partial Eviction
iii. Constructive Eviction
Implied Warranty of Habitability
Retaliatory Eviction
Landlord Tort liability - Caveat

Answer 82

A

Duty to Deliver Possession - English Rule – majority

The landlord must provide the new tenant with legal possession of the lease (lease, keys etc) and actual physical possession of the premises.

if at the start of the new tenants lease, a prior holdover is still in possession than landlord is in breach and the new tenant gets damages

American Rule - minority
The landlord need only provide the new tenant with legal possession of the lease.

Answer 83

A

Implied Covenant of Quiet Enjoyment

Applies to both residential and commercial leases. Tenant has a right to use and enjoy the premises. The landlord implicitly promises to provide the tenant with implied use of the premises. Landlord must not permit a nuisance on site and the landlord must control common areas. LL is not responsible for actions of other tenants.

Answer 84

A

Actual Eviction

Landlord breaches the implied convent if they exclude the tenant from entire premises and tenant does not have to pay rent.

Answer 85

A

Partial Eviction

Landlord breaches by excluding the tenant from part of the leased premises and tenant does not have to pay rent.

Answer 86

A

Constructive Eviction
Landlord breaches the implied covenant by causing the premises to be uninhabitable. The tenant may either: vacate within a reasonable time; or tenant can terminate lease and sue for damages.

There must be substantial interference due to landlords action or failure to act; tenant must notify landlord of the problem and landlord must fail to act meaningfully; tenant must vacate within a reasonable time after landlord fails to fix the problem.

**i.e. tenant lives above landlord and the landlord loved stinky cheese, it was so stinky it breached the tenants quiet enjoyment.

***heating is out and it is the summer in the desert. **Hot water heater was scalding hot so tenants couldn’t use water without it cooling.

**Landlord cuts open wall with mold and does shoddy job, mold spreads through the unit and breaches Quiet enjoyment of tenant by impacting their health.

Answer 87

A

Implied Warranty of Habitability
no heat in winter, no plumbing, no running water

Applies only in residential domain and is not waivable. The premises must be fit for basic human habitation. The standards may be applied by local housing codes or case law. It is not waivable. Tenant needs to make a lawful notification to housing authorities. Landlord cannot retaliate in the subsequent 90 days. If breached, tenant may:

vacate and terminate lease;
make reasonable repairs and deduct costs;
may reduce or withhold rent(must place in escrow to show good faith);
may remain in possession, pay rent and seek damages.

Answer 88

A

Retaliatory Eviction

Tenant may not be evicted, have a periodic lease terminated, or have a tenancy for years not renewed because tenant has asserted that property not habitable and made a lawful notification to local authorities.

Answer 89

A

Landlord Tort Liability - Caveat

LL under no duty to make the premises safe.
Exceptions to Common Law:
- Landlord must maintain common areas;
- Landlord must warn tenant of all latent defects(hidden) that LL should have known about or actually knew about;
- Assumption of repairs(LL voluntary makes repairs must be in a reasonable workmanlike manner);
- Duty to keep spaces open to the public safe(think of short term rentals like 1 night party space);
- Short term lease of a furnished property LL is liable for any defect that hurts the tenant.

Answer 90

A

An interest in a lease is transferable unless the parties expressly agree otherwise. Prohibitions against assignment and/or subleasing are enforceable.

Answer 91

A

Assignment: a transfer in tenant’s entire interest- all rights and obligations- remaining on lease term.
- New tenant personally liable to landlord for rent because there is privity.
- Old tenant is also liable to landlord for rent, unless landlord specifically releases old tenant by novation.

Answer 92

A

Consequences of Assignment:

The assignee stands in the shoes of the original tenant in a direct relationship with the landlord. Thus, Obligor and assignee are in privity of estate and each is liable to the other on all lease covenants that run with the land.

Answer 93

A

Original Tenant remains liable: although original tenant is no longer in privity of estate after the assignment, they remain in privity of contract (unless there is a novation).

Answer 94

A

Covenants that Run with the Land:

A covenant runs with the land if the original parties to the lease so intend, and if the covenant touches and concerns the leased land. To touch and concern the leased land, the agreement must burden one part while benefiting the other, respecting their interests in the property.
Covenants regarding the duration of the lease run with the land. (agreement for an additional 5 year lease upon written request is binding).

Answer 95

A

Sublease:

the transfer of anything less than tenant’s entire interest remaining on lease term.
- New tenant not personally liable to landlord for rent because sublease does not provide privity between new tenant and landlord.
- Old tenant liable to landlord for rent because there is privity.

Answer 96

A

Heaven and Hell Doctrine

The land owner has the right to everything on the surface, below the surface and above the land.

Answer 97

A

Adverse Possession

Possession for a statutorily prescribed period of time, can, if certain elements are met, ripen into title. The possessor must show an actual entry giving exclusive possession that is open and notorious, adverse(hostile) and continuous throughout the statutory period.

Answer 98

A

Actual and Exclusive

The adverse possessor must actually enter and take exclusive possession of the property; that is used in the same manner as that a reasonable owner would. This could be partial or complete possession of the parcel. Exclusive means the owner is excluded from the premises and the property is not open to the public. (putting up a fence, changing locks, physical occupation).

Partial Possession: a reasonable percentage of the property must be actually used. The possessor can only claim possession of the property actually used.

Answer 99

A

Open and Notorious
For possession to be open and notorious, claimant’s act must be Readily visible and conspicuous so that a reasonable owner who inspects the land will receive notice. Seasonal use allowed.

If Possession starts with consent then the possessor does not become adverse until the possessor makes clear she is claiming hostilely.

Answer 100

A

Adverse/Hostile

Occupying without the consent of the owner with the intent to remain against all others. Good faith mistake that the claimant has good title to the land does not negate the possession being adverse to the owner.

Boundary Disputes: when a property owner occupies land thinking it;s his own mistakenly, possession can be deemed hostile.

Answer 101

A

Ouster of a co-tenant is required to find hostile possession with concurrent property owners since all co-tenants have equal rights to possession of property. When a co-tenant refuses to allow another co-tenant access to property, the ousted co-tenant may bring a court action against the possessor to regain possession with the possessor.

Answer 102

A

Continuous for the Statutory Period

Possession must be continuous for the statutory period. At common law the statutory period is 20 years, in some states it is less, in California it is 5 years.

*California requires Payment of the taxes, for other states payment of property taxes is good evidence of a claim of right *

The continuous possession must be that of a reasonable owner, it depends on the nature and character of the land (seasonal).
Seasonal use may still satisfy continuous possession if it is the way a typical owner of similar property would use the land.

Answer 103

A

Color of Title

Adverse possessor entered pursuant to some written instrument that purported to convey him title to the land, but for some unknown reason and unknown to the claimant the instrument is defective and does not in fact convey anything. (napkins, text, any writing)

there is no written instrument here, therefore there is no title to discuss

Answer 104

A

Tacking

Must be more than 1 adverse possessor. The predecessor possessor has privity with the second possessor (renter, family).

Answer 105

A

Disabilities

If disability is present at the time of the adverse possession then the possession will toll. Infancy, Imprisonment, insanity (institutionalized for mental health, or maybe dementia diagnosis- may not be able to assert their right as an owner, a degenerative cognitive issue. Addiction falls into the DSM5 and may be arguable as a disability of mental health).

Answer 106

A

Quiet Title

Adverse possession does not convey marketable title. If elements are satisfied then X has the ability to “quiet title” in his name in order to make the property marketable.

Answer 107

A

EQUITABLE ESTOPPEL

owner may be equitably estopped: an owner may not make a claim against a bona fide purchaser of property if the owner gave someone else title to, or the apparent authority to dispose of, the property. However, if the owner has not conveyed any indicia of ownership or apparent authority to the vendor, equitable estoppel is inappropriate.

Vested ascertainable persons, not subject to a condition precedent.

Answer 108

A

Accession by Innocent Trespasser -

Trespasser Cannot Recover
Where a trespasser adds value to the original owners chattel, the original owner retains title and the trespasser cannot sue for compensation for the value of his labor or materials added.

Answer 109

A

Private property shall not be taken for public use without compensation.
(1) A per se taking is a permanent physical invasion or depriving all economic value.
(2) A regulatory action is a taking that does not meet the per se requirements, but the courts will consider (a) economic impact, (2) benefit of the community and (3) the extent of interference with expectations.

Here, [plaintiff] will argue the value of their land has been taken away as there is no economic use of their land since they only wanted [facts]. The economic impact on [plaintiff] could be great if they cannot be productive with the land, the interference is substantial since the [fact] is the sole purpose of the land so they cannot do what they intended. However, government has a very important interest in protecting its growing infrastructure [facts] because it will benefit the public by supplying resources.

Answer 110

A

5th Amendment- Takings - eminent domain

The power of the government to take private property for public purposes is known as eminent domain. The takings clause of the 5th amendment acts as a check on this power. It provides that private property may be taken; for public use; with just compensation.

Answer 111

A

Private property is owned by a private individual and may be taken by condemnation.
Describe the property, & who it belongs to.

Answer 112

A

A taking is deemed for public use as long as there is a reasonable belief that it will benefit the public: health, safety, welfare, and economic gain.

Answer 113

A

Kelo
The government may take private property not only for its own direct use, but also to transfer the property to another private party. To challenge this taking as not being made for public use, the challenger must prove that the transfer of property is NOT rationally related to any conceivable public purpose. (very difficult to prove)

Answer 114

A

Just Compensation

Just compensation is measured by payment of fair market value- the reasonable value of the property at the time of the taking. The value is measured in terms of loss to the owner, not the benefit to the government.(relocation/moving costs not included).

Answer 115

A

Taking v Regulation

Taking is the physical invasion of ones property and requires just compensation. A regulation is allowing the state to taking property for the public’s interest without compensation. Some regulations do not meet the requirements and constitute as a taking.

Answer 116

A

Physical Invasion

Actual physical entry onto the property.

Answer 117

A

Regulatory Taking

The tenth amendment allows states to regulate the use and development of land for protection of the health, safety, and general welfare of its citizens.

A governmental regulation clearly results in a taking when the regulation results in a permanent physical occupation of the property per se taking(install cable box).

Or when the regulation leaves no economically viable use of the property.

Courts will determine whether a regulatory taking occurred by balancing private and community interest under the three Penn Central factors:

Answer 118

A

Penn Central factors:
1. The economic impact of the regulation on the claimant;
2. The extent to which the interference with the reasonable investment-backed expectations regarding the use of the property(owner’s primary expectation of use of the property) AND
3. The character of the regulation. The court has upheld land-use regulations that destroyed or adversely affected recognized real property interests in instances where the government reasonably concluded that the health, safety, morals, or general welfare would be promoted by prohibiting particular contemplated uses of the land. ( the degree to which it will benefit society, how the regulation distributes the burdens and benefits among property owners, whether the regulation violates any of the owner’s essential attributes of property ownership, such as the right to exclude others from the property.)

Answer 119

A

Zoning

Zoning regulations must be reasonable, not arbitrary and have a substantial relation to public health. Zoning ordinances may give rise to an equal protection clause if similarly situated people are treated differently.

Answer 120

A

Types of Zoning Ordinances

1) Cumulative
2) Noncumulative
i) Variance
ii) Nonconforming use

Answer 121

A

Cumulative

Creates a hierarchy of uses of land; land zoned for a particular use may be used for the stated purpose or for any higher purpose (a house built in an industrial zone , but a factory cannot be built in a residential zone).
NonCumulative

Answer 122

A

NonCumulative

Land may only be used for the purpose it is zoned.

Answer 123

A

Variance

A property owner may obtain a zoning variance(waiver) by administrative action if 1) ordinance imposes a hardship due to unique features of the property, and 2) the variance will not be contrary to public welfare(harm to neighboring areas).

Answer 124

A

Nonconforming Use

Use of the property that was allowed under zoning regulations at the time the use was established but is no longer permitted under new zoning laws. Some statutes allowing nonconforming use to continue and some provide for termination but reasonable amortization provisions. Amortization provides a time frame for owners to comply with new zoning regulations.

If a landowner is required to immediately discontinue use it is a “taking”.

If amortization period is unreasonable it is a taking.

Answer 125

A

Improvements and Rebuilding

Majority of jurisdictions find that any change or improvement must comply with new zoning regulation and that if structure is destroyed, the rebuilt building must comply with zoning regulations.

Answer 126

A

Exaction as a taking

Conditions placed on the approval of permits do not constitute an uncompensated taking under the 5th amendment if:

An essential nexus between legitimate state interest and the conditions imposed on the property owner; AND
The government makes an individualized determination that the condition is roughly proportional( in nature and extent) to advancing that state interest.

Answer 127

A

Just Compensation, FMV, loss to owner, Injunction

Answer 128

A

Zoning ordinances may be enacted to regulate the location of adult theaters and bookstores. So long as the regulation is not to prevent the expression of speech but to prohibit secondary effects.

Answer 129

A

Obscenity: Miller Test

Obscenity is unprotected speech. In order for material to be obscene, and thus unprotected, it must, on the whole, “appeal to the prurient interest in sex” (as judged by contemporary community standards); depict or describe sexual conduct(as specifically defined by state law) in a patently offensive way, and lack “serious literary, artistic, political, or scientific value”( using a national reasonable person standard).

Answer 130

A

Content-Based Regulations – Per Se Unconstitutional

It is presumptively unconstitutional to place burdens on speech because of its content, except for certain categories of unprotected speech. Content-based regulations on protected speech are subject to strict scrutiny. Under the strict scrutiny standard, the government must prove that the regulation is necessary to meet that compelling government interest. (since statute concerns only those who have a particular purpose or message such as preventing begging, then it will be content-based.) compelling is essential or necessary. Substantial is more than legitimate.

Here, [Discuss whether the government’s regulation of speech is content-based. Look at the language of the statute for this. It is presumptively unconstitutional and subject to strict scrutiny].

Answer 131

A

Easements
License
Profits

Answer 132

A

First establish that the easement is created. Then establish whether it is appurtenant or gross and whether it is affirmative or negative. Then address the scope and finally whether the easement was terminated. Usually, whether an easement has been terminated is by bona fide purchaser- occasionally by necessity, prescription or implication.

Answer 133

A

An easement is the grant of a nonpossessory interest that entitles its holder to some form of use or enjoyment of another’s land called the servient tenement.

Answer 134

A

Creation

An easement may be affirmative or negative.

Affirmative/Negative (Only discuss ones that are present and break them into different headers)

Answer 135

A

A negative easement entitles holder to prevent the servient landowner from doing something that would otherwise be permissible. It may only be created expressly (in writing and signed by grantor). A negative easement may only be acquired for light, air, support, streamwater from an artificial flow. In a minority of states a scenic view is an additional negative easement.
Here, the easement [entitles the holder to do something on another’s tract of land/ prevents a landowner from doing something on their own land] because [facts].
Thus, the easement is [affirmative/ negative].

Answer 136

A

A right to do something on the land is an affirmative easement. There are four types: P, I, N, G.

Answer 137

A

Affirmative (only analyze what is present)

Prescription - An easement acquired by satisfying the elements of Adverse Possession, Actual entry that need not be exclusive, open and notorious, hostile use without the servient owner’s consent.

Implication
Necessity
Grant AKA Express

Answer 138

A

Affirmative (only analyze what is present)

Prescription

Implication - AKA easement implied from apparent previous use and the easement’s continuation is reasonably necessary for the dominant’s use and enjoyment.

Necessity
Grant AKA Express

Answer 139

A

Affirmative (only analyze what is present)

Prescription
Implication

Necessity - Traditionally obtained by a landlocked situation where there is no reasonable means of ingress or egress to the property. Conveyance of a part of the land with no way out.

Grant AKA Express

Answer 140

A

Affirmative (only analyze what is present)

Prescription
Implication
Necessity

Grant AKA Express - An easement to endure more than one year must be in writing that comports to all the elements of a deed called “deed of easement.”

Answer 141

A

An easement may be appurtenant to the land or held in gross.

Answer 142

A

Appurtenant (relevant to)

An easement is deemed appurtenant when it benefits the holder in his physical use and enjoyment of his property. This requires two parcels of land; a dominant tenement is a parcel of land which derives the benefits of the easement; a servient tenement suffers the burden of the easement. (identify - “parcel is the dominant tenement because ___”)

Answer 143

A

[Transferability: Easement appurtenant passes automatically with the dominant tenement regardless if it was mentioned in the conveyance. The burden of an easement appurtenant will pass with the servient land, unless the purchaser is a bona fide purchaser without notice of the easement. Notice may be actual, inquiry(constructive), or by record.]

Answer 144

A

Gross - $$$$
Confers upon its holder only a personal, or financial benefit, not linked to the easement holder’s use or enjoyment of their land. The servient land is burdened and there is no dominant tenement.(identify servient tenement).

Answer 145

A

[Transferability: Easements in gross are not assignable/transferable unless they are for commercial purposes. * right to place billboard on another’s lot, right to swim in another’s pond*]

Answer 146

A

Scope of Easement

The scope is set by the terms or conditions that created it. There cannot be any unilateral expansion of an easement to benefit the dominant parcel.
“The easement allows parcel A, the dominant tenement, to utilize 15 ft along the west border of parcel B, the servient tenement”. Address if the party exceeds the scope that was originally given.

Answer 147

A

Surcharge

When an easement holder exceeds the scope of use, the easement is surcharged and a court may grant a servient estate holder an injunction to stop the excess use, which does not terminate the easement, and damages.

Answer 148

A

Duty to Repair

If the easement holder is the only party making use of the easement, that party has the duty to make repairs, and absent an agreement otherwise, the owner of the servient estate has no duty to repair. If the easement is nonexclusive (i.e. both the owner of the servient and dominant estate may use it), both have a duty to repair and a court will apportion costs between them based on relative use.

Answer 149

A

Termination of Easements
(put in even if no termination and state no termination)

END CRAMP

An easement may terminate by estoppel; necessity; involuntary destruction; condemnation; release; abandonment; merger doctrine; prescription.

Answer 150

A

Estoppel

The servient owner materially changes his/her position on the reasonable reliance of the easement holders assurance that the easement will no longer be enforced.

Dominant tenement is estopped from engaging in the easement. look for spending money.

Answer 151

A

Bona Fide Purchaser
A purchaser for value who takes without notice of the easement doesn’t take on the burden of the easement. Notice may be actual, constructive, or by inquiry.

Answer 152

A

Necessity

An easement created by necessity ends as soon as the necessity expires. However, if the easement attributable to necessity was nonetheless created by an express grant as well it will not end when the need ends. (if necessity is destroyed ie tunnel in mt collapses, then the necessity is created again and restart analysis at creation)

Answer 153

A

Involuntary Destruction

Destruction of the servient land is an appropriate termination unless you fall into a category, other than through the willful conduct of the Servient owner. If a Servient owner destroys the land in some way to end the easement to negatively impact the dominant tenement. That is not an acceptable termination.

Answer 154

A

Condemnation

Condemnation of a servient estate terminates the easement when the government exercises eminent domain.

Answer 155

A

Release

A written release given by the easement holder to the servient holder will terminate the easement.

Answer 156

A

Abandonment

The easement holder must demonstrate by physical action the intent to never use the easement again. *ie. dominant tenement holder blocks their own easement access like with a fence. If there is NO physical action, it is not sufficient to terminate the easement.

Answer 157

A

Merger Doctrine

The easement is extinguished when title to the easement and title to the servient land become vested in the same owner. i.e.same owner buys own parcels of land. If land sold again, the new owner cannot reactivate the old easement because it terminated when the lands merged. They would have to create a new easement.

Answer 158

A

Prescription

An easement may be terminated HOAC
-Hostile - entry without owner’s permission

Open and Notorious - visible occupation of land to afford true owner notice and use as the owner would make.

-Actual - actual use must be made in order to determine the scope of the prescriptive easement.

-Continuous - uninterrupted for statutory period

Answer 159

A

License (always will be subsequent related issue to easement- is fall back to easement not properly created)

A license does not convey possessory interest in land, it is a mere privilege to enter another’s land for some delineated purpose. Licenses are not subject to the SoF and thus are freely revocable unless estoppel applies to bar revocation. Estoppel only applies when the licensee has invested substantial money or labor in reasonable reliance on the licenses continuation. **Tickets create freely revocable licenses.

Answer 160

A

The SOF requires that any conveyance of an interest in land of duration longer than one year must be memorialized in writing to be enforceable. If a party attempts to create an easement orally, the result is the creation of a license (a revocable privilege). *** however, if an oral attempt to create an easement is subsequently “executed”, to the extent that it would be inequitable to permit its revocation (e.g., the licensee has expended substantial funds in reliance), the licensor may be estopped to revoke the license.]

Answer 161

A

Profit

The Profit entitles the holder the right to enter servient land and take from it the soil or some natural resource. The profit shares all the rules of easements.

Answer 162

A

Encumbrances – Usually issue cluster with marketable title or breach of warranty.

Generally, mortgages, liens, easements, and covenants render title unmarketable unless the buyer waives them.

Answer 163

A

Covenant - (when plaintiff seeks money damages - apply covenant)

A covenant starts off as a promise regarding the use of 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.
*When the plaintiff wants money damages to be made whole, construe the promise at law as a covenant.

1) Burden to Run
2) Benefit to Run

Answer 164

A

Burden to Run - WITHN

The burden of the covenant is being subject to or bound by it. For the burden of the covenant to run with the land at law: the original promise had to be in writing; the original parties intended that the burden would run; the promise affects the parties as land owners and not citizens at large; horizontal and vertical privity are both needed for the burden to succeed in running from A to A1.

Answer 165

A

Writing
The promise must be included in the writing in the original covenant. (usually in the deed). It must satisfy the statute of frauds. If it doesn’t, look for exceptions such as detrimental reliance, equitable estoppel.

Intent
Touch & Concern of the land
Vertical Privity
Horizontal Privity
Notice

Answer 166

A

Writing

Intent
> The parties must intend the rights and duties run with the land. Look for language such as “his successors, and heirs,” or the fact that they wrote it onto the deed. Why did they intend to do it, what actions or verbage did they use?

Touch & Concern of the land
Vertical Privity
Horizontal Privity
Notice

Answer 167

A

Writing
Intent

Touch & Concern of the land
>The promise needs to relate to the parties legal relationship as landowners.

Vertical Privity
Horizontal Privity
Notice

Answer 168

A

Writing
Intent
Touch & Concern of the land

Vertical Privity
> Established with a non-hostile nexus between the original landholder and the successor. Cannot be satisfied by adverse possession (hostile). The successor must take the original landholder’s entire interest (i.e. not a life estate)

Horizontal Privity
Notice

Answer 169

A

Writing
Intent
Touch & Concern of the land
Vertical Privity

Horizontal Privity
>The original parties to the covenant must have had a conveyance(be in privity)of the estate, i.e. landlord tenant, grantor/grantee or happen to be each other’s debtor/creditor in the land transaction.

Notice

Answer 170

A

Writing
Intent
Touch & Concern of the land
Vertical Privity
Horizontal Privity

Notice
>The subsequent purchaser must have notice of the covenant or they are not bound in equity. (Actual, Constructive- recorded in chain of title, Inquiry)

Answer 171

A

Benefit to Run – WITV - NO HORIZONTAL PRIVITY NEEDED to RUN.

Does the benefit of A’s promise to B run from B to B1?

The benefit of the covenant is the ability to enforce it. The original promise must be in writing; the original parties intended that the benefit would run; the promise affects the parties as landowners/ it pertains to their rights and duties as landowners; vertical privity as a non-hostile nexus between B and B1.

Answer 172

A

Writing
Discuss the writing and parties.

Intent
Touch & Concern of the land
Vertical Privity

Answer 173

A

Writing

Intent
> Why did they intend to do it, what actions or verbage did they use?

Touch & Concern of the land
Vertical Privity

Answer 174

A

Writing
Intent

Touch & Concern of the land
>The promise needs to relate to the parties legal relationship as landowners.

Vertical Privity

Answer 175

A

Writing
Intent
Touch & Concern of the land

Vertical Privity
>Established with a non-hostile nexus between the original landholder and the successor. Cannot be satisfied by adverse possession (hostile). The successor need only take some interest in the estate (could be a life estate).

Answer 176

A

Equitable Servitude (injunction to enforce burden) – WITTNES

An equitable servitude is a promise regarding land that equity will enforce against successors; it is accompanied by injunctive relief.

To creating a binding ES: the original promise must be in writing; the parties intended the promise will bind successors; the promise affects the parties as landowners; the successors of the burdened land had notice of the promise when they took.

Most courts view this as an equitable property interest, thus Privity is NOT required to bind successors.

Answer 177

A

Writing
Discuss the writing and parties.

Intent
Why did they intend to do it, what actions or verbage did they use?

Touch & Concern of the land
The promise needs to relate to the parties legal relationship as landowners.

Notice
The successors of the burdened land had notice of the promise. (Actual, Inquiry(neighborhood conforms to the common restriction), record).

Answer 178

A

Implied ES - General or Common Scheme Doctrine

Always arises in the context of a subdivision. If a covenant in a subdivision deed is silent as to who holds its benefit, any neighbor in the subdivision will be entitled to enforce if the covenant is found to have existed at the time he purchased the lot and there was an original intent to create a servitude on all the plots. Writing not req’d. The servitude must be negative.

Answer 179

A

Notice

To be bound by the terms of the equitable servitude defendant must have had actual or inquiry notice. The majority of states do not obligate the lot holder to know the history of deeds for the properties surrounding the lot. Inquiry notice, the neighborhood appears to conform to common restrictions. Actual notice is direct notice of the covenants in prior deeds.

Answer 180

A

Equitable defense - Pervasive Change use

The change in the use of the community is so pervasive & not just mere pockets of change that the restrictions should be lifted.

Answer 181

A

Generally tested with Joint tenancies and whether an execution of the mortgage severs the joint tenancy. It can be tested as buyer taking out a new mortgage on newly purchased property.

A mortgage is a security interest given by the mortgagor/borrower to the morgagee/lender whereby a loan is made and if it is not paid in full, the sheriff may sell the land at a court-ordered foreclosure sale. The land is used as collateral for the repayment of debt.

Answer 182

A

Mortgage Components

A mortgage consists of a promissory note which is a personal promise from the borrower to repay the loan making them personally liable if they default and deficiency judgment is sought, and the mortgage itself which secures the note to the property as collateral.

Answer 183

A

Equitable Mortgage – Aka Deed of Trust

Debtor give creditor a deed to his land as collateral for the debt(instead of executing a mortgage). If the loan is not paid in full, the trustee can either obtain a court order for a foreclosure sale on the property or sell the property for themselves at public option.

Answer 184

A

Acceleration clauses

terms in loan agreements that require mortgagor to pay off full loan immediately if certain conditions are met (e.g., if mortgagor misses too many payments)

Answer 185

A

Mortgagor transfer

where mortgagor sells property, mortgage remains on land (i.e., grantee takes “subject to” the mortgage)
Mortgagor remains liable to mortgagee for the loan.

Answer 186

A

Assumption

grantee promises to pay existing mortgage loan. Grantee becomes primarily liable to mortgagee; original party is secondarily liable as surety

Answer 187

A

A mortgagee (creditor) can transfer her interest by

1) Endorsing the mortgage note and delivering it to transferee

2) Executing a separate assignment of the mortgage interest

Answer 188

A

Holder in due course

a holder in due course lender takes a mortgage note free of any personal defenses mortgagor could have raised against original mortgagee (e.g., lack of consideration, fraudulent inducement). He still remains subject to real defenses (e.g., duress, fraud, etc.)

Answer 189

A

Requirements for holder in due course status

1) Negotiable note – must be made payable to the named mortgagee

2) Indorsed – note must be signed by the named mortgagee

3) Delivered – note must be delivered to the transferee, and

4) Good faith and value paid – transferee must take the note in good faith (i.e., without notice of illegality) and pay value

Answer 190

A

upon default by mortgagor, mortgagee can satisfy debt through foreclosure by judicial action. Property is sold to satisfy the debt in whole or in part

Answer 191

A

Deficiency judgment

if the debt exceeds sale proceeds, mortgagee can file suit against mortgagor for debt balance only if: There was a judicial foreclosure; Loan was not a Purchase Money Mortgage. (Mortgage taken out for the original purchase of the property).

Answer 192

A

Excess

if proceeds exceed the debt balance, junior liens are paid in order of priority and then remaining to the buyer

Answer 193

A

Priority of creditors

after land sold, proceeds are used to satisfy debt secured by property. Creditors must record their interests, and recorded interests take priority in the order recorded. Any debts secured by property are paid in chronological order (senior mortgages superior to junior mortgages)

Answer 194

A

Purchase money mortgages (PMM) – superior to all interests

PMM is given either to the seller as part of the purchase price or to a third-party lender (if both, seller’s PMM is senior to the third-party lender). Creditors can agree to subordinate priority to a junior creditor.

PMM may not also get deficiency judgment against debtor.

Answer 195

A

Junior interests

terminated by foreclosure of a superior claim. I.e., upon foreclosure, junior interest holders cannot look to the land to satisfy debts. Junior interests can seek a deficiency judgment against debtor, but they have no interest in the subject property

Necessary parties – junior interests are necessary parties and must be included in a senior foreclosure action. Otherwise, the junior interest will remain on the land

Answer 196

A

Senior interests

unaffected by junior interest foreclosures. Buyer of foreclosed property takes it subject to senior interests. Buyer is not liable for senior debt, but the senior mortgage remains on the land (so they can get that interest!)

Answer 197

A

Order of payment

1) Fees for attorneys/trustees

2) PMM or secured senior interests

3) Secured junior interests (foreclosure of senior interests will destroy all junior interests)

4) Unsecured interests

Answer 198

A

> Redemption in equity

at any time prior to the foreclosure sale, mortgagor can redeem the property by paying the amount that’s due

> Statutory right of redemption

some jurisdictions allow mortgagor, for a certain period, to buy back the property after foreclosure sale

Answer 199

A

Deed in lieu of foreclosure

to avoid foreclosure, mortgagor can agree to give mortgagee deed to property. Such transactions will be valid as long as they are fair and reasonable under the circumstances

Answer 200

A

Mortgagee possession

mortgagee’s right to possession prior to foreclosure depends on the jurisdiction

Lien theory(MBE’s) – no right to possess prior to foreclosure

Title theory – right to possess at any time upon demand
Mortgagee can always take possession with mortgagor’s consent or abandonment
Mortgagee in possession assumes the risk of: Accounting for rents, Managing property, and Tort liability

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