Real property Flashcards
Freehold Estates: What are the three species of defeasible fees?
Fee simple determinable
Fee simple subject to condition subsequent
Fee simple subject to an executory limitation.
What is a fee simple determinable?
Language: Clear Durational Language - language providing that upon the happening of a stated event, the land is to revert to the grantor
Automatic!
Duration: Potentially infinite, so long as event does not occur.
FI: Possibility of reverter (held by grantor).
FSDPOR: Fee Simple Determinable, Possibility Of Reverter.
NY term:
Fee simple determinable
“Fee on limitation”
What is a fee simple subject to condition subsequent?
To A, but if X event happens, grantor reserves the right to reenter and retake.”
Grantor must carve out right of entry.
Not automatic - must exercise right!
Duration: Potentially infinite, so long as event does not occur.
FI: Right of entry/power of termination (held by grantor)
NY term:
Fee simple subject to condition precedent
Fee on condition
NY term:
Right of entry / power of termination
Right of re-acquisition
What is a fee simple subject to an executory limitation?
To A, but if X event occurs, then to B.”
Duration: Potentially infinite, so long as stated contingency does not occur.
FI: Shifting Executory interest (held by third party).
(Just like FSD, only now, if the condition is broken, estate is automatically forfeit in favor of someone other than O, grantor.)
Life estate: Future interest?
Reversion - if to Grantor
Remainder - if to 3rd party
What is a remainder?
Future interest in GRANTEE (not O)
Preceding estate of known fixed duration (life estate / number of years)
Never after defeasible fee. Doesn’t cut off prior transferee. Not executory interest.
Vested remainder
Created in ascertained person. No CP.
3 types of vested remainder
Indefeasibly vested
Vested subject to complete defeasance
Vested subject to open
- Indefeasibly vested remainder
Certain to acquire. No conditions.
If predeceases condition - to heirs (CL)
- Vested remainder subject to complete defeasance / total divestment
Condition subsequent. (If CP would be a contingent remainder)
Remainderman’s possession could be cut short by a condition subsequent.
NY term:
Vested remainder subject to complete defeasance
“Remainder vested subject to complete defeasance”
just switched some words around
How to distinguish between CP and CS
CP: before - “if, then” - might not happen –> contingent remainder
CS: after “provided that” - will happen but might not continue –> vested remainder subject to complete defeasance
- Vested subject to open
Class/category not yet closed
At least one already qualified to take (if not –>contingent)
Closes when max membership set, persons born afterwards are excluded
(i.e. whenever any member can demand possession)
Fetus included.
Contingent remainder
Created in unascertained/unborn person(s) OR subject to CP.
NY term:
Contingent remainder AND executory interest are both called:
Remainder subject to CP.
Abolished rule:
“Destructability of contingent remainders”
If still contingent when previous estate ended –> remainder destroyed.
Instead: Grantor with contingent remainder’s springing executory interest.
Abolished rule (everywhere): "Shelley's case" "To A and then to A's heirs"
Becomes FSA.
Instead: Becomes life estate + contingent remainder + O reversion if no heirs.
Abolished rule (in NY):
“Rule of worthier title”
Life estate to A then to O’s heirs.
No remainder in grantor’s heirs. becomes reversion to O.
[Abolished only in NY]
2 types of executory interest
Cuts short interest in O or heirs: “springing”
Cuts short interest in 3rd party: “shifting” – always follows defeasible fee.
When are absolute restrains on alientation voided?
When not linked to reasonable time-limited purpose
Must state TIME and PURPOSE
Tenant entitlement in life estate?
Entitled to all ordinary uses and profits from land.
Must not commit “waste” (i.e. injury to future interest holders)
Three types of “waste”
Voluntary/affirmative
Permissive
Ameliorative
Voluntary/affirmative waste
“Actual overt conduct which causes diminution of value”
Cannot consume/exploit natural resources
4 types of permitted “voluntary waste”
PURGE: Prior Use (was already used for exploitation / open mines) Repairs Granted right to do so Land suitable only for Exploitation
Permissive waste
Must maintain in good repair and pay ordinary taxes.
(to extent of income from land;
to extent of fair rental value - if no income)
Ameliorative waste
Not allowed to enhance value!
EXC: All remaindermen are known and they CONSENT.
NY Reasonable improvements OK unless remaindermen OBJECT (default - allowed)
RAP
Paula’s 4-step test
- Identify future interest
- Identify CP to vesting
- Idenify measuring life
- Certainty after death + 21y?
Future interests subject to RAP
Contingent remainder
Executory interest
Vested remainder subject to open (some)
Future interests NOT subject to RAP
Future interest in Grantor: POR, right of entry, reversion
Indefeasibly vested remainders
Vested remainder subject to complete defeasance [STRANGE!]
Charity to charity transfers [not initial transfer to charity]
Gift to open class conditioned upon members surving beyond 21y?
Violates CL RAP (since someone still might be born and then need to wait 21y).
“Bad as to one, bad as to all” - CP for each member must occur within RAP period.
Otherwise - entire gift void.
Executory interest with no limit on time for vesting
Violates RAP.
What happens when future executory interest violating RAP is stricken?
If provision not gramatically sound anymore - entire condition is stricken.
(The result is that O no longer has a POR, and A has FSA!)
(Better for O to state “to A so long as, then to?.)
RAP Reform (not NY): "Wait and See" / "2nd Look"
Validity of suspect future interest determined on basis of
“facts as they now exist, at conclusion of measuring life”.
–> No “what if” “anything possible”
RAP Reform (not NY): Uniform Statutory Rule Against Perpetuities
Provides alternative 90-year vesting period.
RAP Reform (not NY): Cy Pres
“as near as possible”
Court power to reform transfer in a way most closely matching grantor’s intent, whilee complying with RAP.
[Under “Wait and See” and USRAP]
RAP Reform (also NY!): Age contingency reduction
Reduction of offensive age contingencies to 21.
[Under “Wait and See” and USRAP]
RAP Reform in NY?
Reforms: - Age contingencies reduced to 21y. - Fertile octogenarian - 55y. - No suspension of absolute power of alienation if > life+21y No Wait and See, no Cy pres.]
CONCURRENT OWNERSHIP
3 forms:
Joint tenancy
Tenancy by the entirety
Tenancy in common
Joint tenancy is:
2 or more own WITH right of survivorship
Joint tenancy: Transferability
Transferable inter-vivos.
But not devisable/descendable (because of survivorship)
Joint tenancy: Creation
4 unities: - Same time - Same title - Identical equal interests - With right to possess as a whole AND Grantor must clearly state right of survivorship. No default.
Joint tenancy: Use of straw man?
MBE: Needed when single holder wants to add a joint tenant.
NY No need.
Joint tenancy: Severance - sale during lifetime
Buyer becomes tenant in common.
Joint tenancy severed as soon as sale agreement signed (“equitable conversion”)
OK to sell secretly.
Joint tenancy: Severance - partition
- Voluntary agreement.
- Partition in kind: Judicial action for physical division
- Forced sale, proceeds divided equally.
Joint tenancy: Severance - mortgage
Execution of mortgage does NOT sever joint tenancy (NY + majority - “lien theory”)
(Minority - “title theory”)
Tenancy by the entirety
Protected marital interest WITH right of survivorship
NY default for couples
Tenancy by the entirety: Creation
H&W sharing right of survivorship “as fictitious single person”
Default! Any conveyance made to H&W unless stated otherwise.
Tenancy by the entirety: Creditors of only one spouse
Creditor of one spouse can’t touch tenancy.
NY One spouse can mortgage his own share. Right of survivorship cannot be compromised.
Tenancy by the entirety: Unilateral conveyance
Spouse can’t transfer share to third party without other spouse approval.
Tenancy in common
2 or more own WITHOUT right of survivorship
Tenancy in common - features
Each owns individual part, with right to possess whole.
Descendible, devisable, alienable.
No survivorship rights.
Favored by presumption!
Tenancy in common - can tenant demand rent for being absent?
No.
Tenancy in common - can tenant demarcate property?
No - actionable ouster.
Tenancy in common - one tenant rents out portion
Other tenants entitled to proportionate amount of rental payments.
Tenancy in common - tenant acquires other tenant’s title through adverse possession?
MBE: No. Only by ouster (incl hostility)
NY: Yes if in possession for 20y - “implied ouster”
Tenancy in common - repairs, carrying costs by one tenant?
Entitles to “contribution” from other tenants.
Only repairs, not improvements, except credit at partition for increased value
LEASEHOLD ESTATES
4 types
Tenancy for years
Periodic tenancy
Tenancy at will
Tenancy at sufferance
Tenancy for years
Fixed time.
No notice before expiration.
SoF: >1y must be in writing
Periodic tenancy
Successive intervals until one party gives notice.
Expressly or by implication (contract mentions payment intervals but not lease period, oral term of years in violation of SoF)
Or by Holdover –> implied tenancy for terms of payment.
Periodic tenancy - holdover in NY?
Implied month-to-month tenancy unless agreed otherwise.
Periodic tenancy - when does it end
At conclusion of natural lease period only.
Tenancy at will
No fixed period. Endures as long as either wants.
Payment of regular rent –> implied periodic.
Tenancy at will - when terminated?
By either party upon reasonable demand.
NY Landlord gives at least 30 days.
Tenancy at sufferance
When tenant WRONGFULLY holds over.
Tenant gets ‘leasehold estate’ to allow landlord to collect rent.
Tenancy at sufferance - when terminated?
Until L evicts or holds T for new term.
NY Acceptance of rent creates implied month-to-month periodic tenancy.
TENANT’S DUTIES
3 types
3rd parties
Repair
Pay rent
Tenant duty to 3rd parties
Keep in reasonable repair.
Liable to 3rd parties even when Lessor promised to make repairs.
Tenant duty to repair; law of fixtures
To maintain.
No “waste”.
Fixtures = intent to permanently improve; cannot remove.
“Fixtures pass with ownership of land”
When is tenant’s installation a “fixture”?
When removal doesn’t cause substantial harm “in objective judgment” –> NOT a fixture
Causes = intention to install fixture.
When premises destroyed AND tenant ha obligation to maintain in good condition?
Majority: T may end lease if premises destroyed without T’s fault.
NY T may end lease when lessee does not give express undertaking to restore.
(CL: T responsible for any loss including force of nature)
Failure to pay rent - self help?
NO!
Huge damages in NY.
Only: eviction through court, or continue and sue for rent
Failure to pay rent while T is not in possession?
L can decide whether to “surrender”, “ignore” or “relet”
Failure to pay - “surrender”
Implies offer of surrender of leasehold.
But if >1y, must be in writing under SoF, no implication.
Failure to pay - “ignore” (only NY)
As if T still in possession, hold liable for deficiency in rent payments.
NY + minority
Failure to pay - “re-let” (not NY)
Good faith effort to re-let in order to mitigate damages.
Not required in NY