Real Property Flashcards
This too shall pass, so will we.
What is the priority ranking for descriptions of land in a deed?
- Natural monuments (e.g., “From Moss Lake to the oak tree)
- Artificial monuments (e.g., “From the Empire State Building to Statue of Liberty.”)
- Course measurements (e.g., “North 25 degrees”)
- Distance measurements (e.g., “East 45 feet to Grace Street.”
- General monuments (e.g., “The 10 acres known as Blackacre.”)
What is the result of the sudden, perceptible change of a watercourse that serves as a boundary to real property?
No change to the riparian landowners’ property rights
Against whom may a grantee invoke the doctrine of estoppel by deed?
The grantor only.
What is estoppel by deed?
Under the doctrine of estoppel by deed, if a grantor purports to convey an estate that he does not then own, his subsequent acquisition of title to the property automatically inures to the benefit of that grantee.
In other words, the grantor impliedly covenants that he will convey title upon its acquisition and is estopped to deny that he acquired title on the grantee’s behalf.
Is a living grantee required in order to transfer legal title to real property?
Yes, always.
Property cannot be conveyed to a grantee who does not exist. Thus, a deed to a grantee who is dead at the time of delivery is void.
Is a competent grantor required to transfer legal title to real property?
No.
Is a grantee required to provide consideration in order to make a deed valid?
No. No consideration is required to make a deed valid.
What are the requirements for a validly conveyed deed?
- At least donative intent,
- Delivery, and
- Acceptance
In order to be a bona fide purchaser, you must provide __________________ consideration.
Valuable.
When a watercourse or body of water forms the boundary of a parcel of real property, accretion causes the legal boundary to change due to __________.
the slow and imperceptible deposit of soil.
What is the correct order of priority for allocating foreclosure sale proceeds
- Expenses of the sale, including attorneys’ fees, and court costs;
- The principal and accrued interest on the foreclosing party’s loan;
- Any junior lienors in the order of their priority; and then
- The mortgagor.
Is the lender allowed to bid on a property at a foreclosure sale?
Yes, and in many cases the lender is the sole bidder.
What does it mean for an easement to be surcharged?
The easement’s legal scope was exceeded
What is a present possessory estate?
interest in land that gives the holder the right to present possession
What are the characteristics of a fee simple absolute?
- largest estate recognized by law
- can be sold, divided, devised, or inherited
- potentially indefinite duration
True or False: a fee simple is presumed in the absence of express contrary intent
True
What is a defeasible fee?
a fee simple estate that can be terminated upon the happening of a stated event
What future interest accompanies a fee simple determinable?
Possibility of reverter
Does a fee simple determinable automatically revert to grantor if its stated condition or event happens?
Yes.
What type of language creates a fee simple determinable?
durational language such as: so long as, while , during, or until
Is a fee simple determinable alienable?
yes, but the grantee takes subject to the estates being terminated by the specified event.
Is a possibility of reverter transferable? descendible? devisable?
Yes
What is a fee simple on condition subsequent?
estate in which the grantor reserves the right to terminate the estate upon the happening of a stated event.
does a fee simple on condition subsequent automatically terminate if the stated condition manifests?
No, the grantor must go in and take back the estate
What type of language creates a fee simple on condition subsequent?
conditional language: upon condition that, provided that but if, and if it happens that.
Is a right of reentry transferable (1) intervivos? (2)devisable? (3) descendible
(1) no
(2) most states say yes
(3) all states say yes
If a condition contains durational and a power of termination, which defeasible fee will courts presume?
a fee simple on condition subsequent
What is a fee simple subject to an executory interest?
an estate that terminates upon the happening of a stated event and then passes to a third party rather than reverting to the grantor or giving the grantor a right to terminate
What is the result if a condition or limitation is found to violate public policy?
the court will strike the condition and the grantee will take free of the invalid restraint
Is a fee tail a valid estate under the modern law in most jurisdictions?
No, an attempt to create one will result in a fee simple
What is a life estate?
an estate that is measured but he life or lives of one or more persons
What are the types of life estate?
(1) for the life of grantee
(2) life estate pur autre vie
What is a life estate pur autre vie?
it is a life estate that is measured by the life other than the grantee’s
Example: O –> A for life ; A–>B, B has a life estate pur autre vie
What rights does a life tenant have?
ordinary uses and profits fo the land
What duty does a life tenant have?
Duty not to commit waste
May a future interest holder sue for damages against a life tenant who has committed waste? May they seek to enjoin the action?
they may sue for both damages and an injunction
When exploiting natural resources (affirmative waste), a life tenant is generally limited to situations when:
(1) its necessary for repair or maintenance of the land;
(2) land is only suitable for such use
(3) it is expressly or impliedly permitted by the grantor
What is the open mines doctrine?
if mining was done on the land prior to the life estate, the life tenant can continue mining, but is limited to the mines already open.
What are the life tenant’s obligations under the doctrine of permissive waste?
(1) preserve the land and structures in a reasonable state of repair;
(2) pay interest on mortgages (not principle)
(3) pay ordinary taxes on the land
(4) pay special assessments for public improvements of short duration
Is the life tenant obligated to insure the property for the benefit of remaindermen?
No
Is the life tenant responsible for damages caused by a third-party tortfeasor?
No
What is ameliorative waste?
a change that benefits the property economically.
When may a life tenant alter or demolish existing buildings? (i.e. not liable for ameliorative waste)
(1) the market value of the future interests is not diminished; AND
(2) the remaindermen do not object; OR
(3) a substantial and permanent change in the neighborhood conditions has deprived the property in tis current form of reasonable productivity or usefulness
Is a leasehold tenant (as compared with a life tenant) liable for ameliorative waste if the neighborhood has changed and the market value of the premises was increased?
Yes.
May a life tenant seek a partition sale if the land he has interest in is practically worthless?
Yes, and the proceeds are put in trust and she is entitled to the income.
What is a reversion?
its the estate left in the grantor who coneys less than what she owns.
Example: O conveys “to A for life.” O then has a reversion
Is a reversion alienable, devisable, or inheritable?
Yes to all three
Can the holder of a reversion sue for waste and tortious damages to their reversionary interest?
Yes
Is a reversion subject to the rule against perpetuity?
No, because it is always a vested interest
What is a remainder?
its a future interest in a third person that can become possessory on natural expiration of the preceding estate
Can a remainder ever divest the present possessory estate?
No
Must the remainder be expressly created in the same instrument creating the preceding possessory estate?
Yes
What is an indefeasibly vested remainder?
remainder is one created in an existing and ascertained person, and not subject too a condition precedent
What is a vested remainder subject to open?
it is a vested remainder created in a class of persons that is certain to become possessory, but is uncut to diminution e.g. by the birth of additional persons who will share
What is a vested remainder subject to total divestment>
it is a vested remainder that is subject to a condition subsequent
Example: O conveys “to A for life, then to B and his heirs, nit if B dies unmarried, then toe C and his heirs”
What is a contingent remainder?
A remainder that is created in unborn or unascertained persons, or **subject to a condition precedent
** Example: O conveys to A for life, then to B and his heirs if B marries C
What is an executory interest?
its a future interest in third party that either divest a transferred preceding freehold estate (shifting) or follow a gap in possession or cut short a grantor’s estate (springing)
Example (shifting): O conveys to A for life, then to B; but if B predeceases A, the to C and his heirs. C has a shifting executory interest because
Example (springing): O conveys to A when A marries B. A has a springing executory interest
Is a vested remainder transferable, descendible, and devisable?
Yes to all three
Are contingent remainder sand executory interests transferable, descendible, and devisable?
At common law: no
Modern law: Yes to all three
What is the rule of convenience?
Under the rule of convenience, in the absence of express contrary intent, a class closes when some member of the class can call for distribution of her share of the class gift.
What is the rule against perpetuities?
No interest in property is valid unless it must best, if at all, not later than 21 years after some life in being at the creation of the interest.
What interests does RAP apply to?
contingent remainders, executory interests, vested remainders subject to open, options to purchase , rights of first refusal and powers of appointment.
True or False: any restriction on the transferability of a legal interest is void
True
What are the three types of restraints on alienation?
(1) disabling restraints, under which attempted transfers are ineffective; (ii) forfeiture restraints, under which an attempted transfer forgets the interests; and (iii) promissory restraints under which an attempted transfer breaches a covenant
Are all absolute retains on fee simple estates are void?
yes, but forfeiture or promissory restraints on fee simple estates for a limited time and reasonable purpose may be upheld
What is a joint tenancy?
a concurrent estate who’s distinguishing feature is the right of survivorship;
What is the right of survivorship?
it provides that when one join tenant dies, the property is feed from her concurrent interests and her survivors do not succeed to it
What are the four unities required to create a joint tenancy at common law?
PITT:
Possession: they must have the same right to possession
Interest: the interests must be identical
Time: they must take title at the same time
Title: they must take title by the same instrument
What is required in addition to the four unities to create a joint tenancy at common law?
a clear expression of a right of survivorship; otherwise a conveyance to two or more people is presumed to be a tenancy in common
What will sever a joint tenancy?
(1) inter vivos conveyance
2) mortgage on a joint tenant’s interest in a title theory state (minority rule
Will a judgment lien on the Joint tenant’s property sever a joint tenancy?
No, unless the property is sold at a foreclosure sale
What is a tenancy by the entirety?
it is a martial estate akin to joint tenancy.
What can sever a tenancy by the entirety?
death, divorce, mutual agreement or execution by joint creditor of both the spouses
What is a tenancy in common?
current estate with no right of survivorship
True or false, under modern law, courts presume a joint tenancy.
false, courts presume a tenancy in common
What are the rights of a co-tenant?
(1) the right to possess all portion of the property but has no right to exclusive possession of any part
(2) the right to retain profits from her own use of the property, but she must share in net rents from third parties and any profits gained from exploitations of the land such as mining.
May a joint tenant encumber her interest in the property? (ex. by mortgage or lien)
Yes
What is the effect of a mortgage on the interest of a co-tenant?
the mortgagee can foreclose only on the mortgaging co-tenant’s interest
True or false: any co-tenant has a right to judicial partition?
True
What are the two types of partition?
(1) In kind: physical division of land amount co-tenants
(2) by sale and division of the proceeds
Is a co-tenent who pays more than her share of necessary repairs is entitled to contrition from the other co-tenants?
Yes, if she notified them of the need for repairs
Is there a right of contribution from other co-tenants for the cost of improvements?
No, unless there is a partition
Can a co-tenant demand contribution for taxes or mortgage payments rapid on the entire property?
Yes
What is a leasehold?
an estate in land under which the tenant has a present possessory interest in the leased premises and the landlord has a future interest (reversion)
What is a tenancy for years?
it is a leasehold for a fixed period of time
Example: L rents to T for two years
How is a tenancy for years created?
usually by a written leases, Statute of Frauds is created if lease is for more than one year
When does a tenancy for years end?
automatically at its termination date
What is the result if a tenant breaches a covenant contained in the lease?
the landlord retains a right of entry, which allows her to terminate the lease if the tenant breaches
What is a periodic tenancy?
it is a leasehold that continues for successive periods until terminated by proper notice by either party
How is a periodic tenancy tenancy created?
Either by:
(1) express agreement
(2) implication
(3) operation of law
How is a periodic tenancy terminated?
upon proper notice of termination given.
How much notice is required before a periodic tenancy can be terminated?
one full period in advance notice is required
How much notice is required to terminate a year-to-year lease?
at least six-month’s notice
What is a tenancy at will?
it is a leasehold that is terminal at the will of either the landlord or the tenant
How is a tenancy at will created?
generally, by express agreement that the lease can be terminated at any time. Absent such agreement, period rent payments will cause a court to treat it as a periodic tenancy
How is a tenancy at will terminated?
most states require notice and a reasonable time to quit; OR by operation of law (death, commission of waste)
What is a tenancy at sufferance?
It is a leasehold that is created when tenant wrgongfully remains in possession after the expiration f a awful tenancy
When is a tenancy at sufferance terminated?
until the landlord takes steps to evict the tenant.
Is notice required to terminate a tenancy at sufferance?
No
What is the hold-over doctrine?
if a tenant continues in possession after his right to possession has ended, the landlord may:
(1) evict her; OR
(2) bind her to a new periodic tenancy.
True or false: a residential tenant can be held to a new year-to-year tenancy if the original tenancy was for a year or more?
False, only commercial tenants can be committed to a year to year tenancy if he retains possession after his right to possession has ended
What is a lease?
it is contract that governs the landlord-tenant relationship
True or false: at common law, covenants in leases were independent, meaning that if one party breached a covenant, the other party could recover damages but still had to perform his promises and could not terminate the landlord-tenant relationship.
True.
What are the modern exceptions to the common law rule that covenants in leases were independent
(1) constructive eviction
(2) implied warranty of habitability
(3) landlord’s right to terminate the lease for non-payment
What is required under the tenant’s duty to repair (doctrine of waste)?
under this duty, a tenant cannot damage the leased premises.
When has a tenant committed voluntary waste in a landlord-tenant relationship?
(1) when the tenant intentionally or negligently damages the premises or exploits minerals on the property
When has a tenant commit permissive waste in a landlord-tenant relationship?
When the tenant fails to take reasonable steps to protect the premises from damages from the elements. The tenant is liable for all ordinary repairs’ excluding ordinary wear and tear.
When does a tenant commit ameliorative waste in a landlord-tenant relationship?
when the tenant alters the leased property, thereby increasing its value. Generally, the tenant will be liable for the cost of restoration.
NOTE: Modern trend will permit a tenant to make this type of change if he is along-term tenant and the change reflects changes in the neighborhood
True or false: if a leased premises is destroyed without the fault of either party, then neither party has a duty to restore but the tenant must continue paying rent.
true, but most states have statutes allowing a tenant to terminate in this situation.
May a commercial tenant covenant to repair?
Yes, and landlord will be able to sue for damages if tenant breaches
Is a landlord permitted to retain a deposit above the amount of actual damages incurred?
No.
What are a landlord’s remedies when a tenant fails to pay rent but stays on property?
(1) sue for rent; or
(2) evict
True or false: at common law the landlord had no duty to repair or maintain a leased premises?
True, but this has been modified by statute in most states
What is the duty to deliver possession of the premises in the landlord-tenant context?
Rule in most states that requires the landlord to put the tenant in actual possession of the premises at the beginning of the leasehold term.
How would a landlord breach her duty to deliver possession of the premises?
By failing to evict a hold-over tenant
What is the implied covenant of quiet enjoyment?
it is implied in every lease that provides that the landlord, nor any paramount title holder will interfere with the tenant’s quite enjoyment and possession of the premises.
How can the covenant of quiet enjoyment be breached ?
(1) actual eviction: landlord, hold-over tenant, or paramount title holder excludes the tenant from the entire leased premises.
(2) Partial Eviction: occurs when the tenant is physically excluded form only part of the leased premises.
(2) Constructive Eviction: occurs when the landlords breach of duty renders the premises unsuitable for occupancy
If a tenant is partially evicted from the premises, is she obligated to pay rent for the portion of rent she retains possession of?
No, it relieves the tenant of the obligation to pay rent for the entire premises
What elements must a tenant establish to claim constructive eviction?
(1) the landlord breached a duty to the tenant
(2) the breach substantially material deprived the tenant of her use and enjoyment of the premises
(3) The tenant gave the landlord notice and a reasonable time to repair
(4) after such reasonable time the tenant vacated the premises
If a tenant successfully establishes constructive eviction, what remedies may she seek?
(1) termination of the lease; AND
(2) damages
What is the implied warranty of habitability?
applied in most jurisdictions, it is a covenant of habitability that is implied into residential leases.
Is the implied warranty of habitability waivable by a tenant?
No
What are the standards of living required by the implied warranty of habitability?
they are governed by the local housing codes
What are a tenant’s remedies if a landlord breaches the implied warranty of habitability?
(1) terminate the lease
(2) make repairs and offset the cost against future rent;
(3) abate the rent to an amount equal to the fair rental value in view of the defects; OR
(4) remain in possession, pay full rent, and sue for damages
Does the implied warranty of habitability apply to commercial leases?
No
If the lease is silent on this matter, may a tenant transfer her leasehold interest?
Yes, in whole or in part.
What is an assignment of a leasehold interest?
It is a transfer of a tenant’s entire remaining leasehold interest to a 3rd party.
What is a sublease of a leasehold interest?
It is a transfer of part of a tenant’s interest in the remaining leasehold to a 3rd party
What is the consequence if a tenant makes a valid assignment to an assignee?
The assignee stands in the shoes of the original tenant in a direct relation with the landlord;
The assignee and the landlord are in privity of estate and each is liable to the other on all covenant in the lease that run with the land
When does a covenant run with the land?
when the original parties so intend and if the covenant touches and concerns the land
Does a covenant to pay rent run with the land?
Yes, it must be paid directly to the landlord
Is a sublessee in privity with the landlord?
No, a sublessee pays rent to the original lessee. The sublessee is not personally liable to the landlord for rent or for the performance of any of the covenants in the main lease unless the sublessee expressly assumes the covenants
Can a sublessee enforce the covenants contained in the main lease against the landlord?
No, they are not in privity
Can a sublessee enforce the implied warranty of habitability against the landlord?
Yes
True or false: Lease covenant restricting assignment and sublease are strictly construed against the tenant.
False, they are strictly construed against the landlord.
If a landlord is aware of a violation against a covenant of assignment and does not object, has she waived that objection?
Yes
If a tenant assigned or subslets in violation of lease, is the transfer void?
No, it is voidable at the election of the landlord, who may also sue for damages
Is the tenant’s consent required for the landlord to assignhis right to rent payment and reversionary land interest?
No
When a landlord assigns his interest, must the tenant begin paying rent to the assignee?
Yes, after the tenant is given reasonable notice of the assignment.
True or false: when a landlord assigns his interest, the benefit of all tenant covenants that touch and concern the land runs with the landlords estate to the new owner.
True
Doe the burden of the landlord’s covenants that touch and concern the land run with the landlord’s estate to a valid assignee?
yes, thus the assignee is liable for the performance of those covenants.
If a landlord assigns his interest, does she remain liable on all of the covenants she made in the lease?
Yes, because the original landlord is in privity of contract with the tenant
Is the tenant’s obligation to pay rent extinguished if the leased premises is condemned?
Yes, but only if the entire leasehold is taken by eminent domain.
Is the lessee entitled to compensation if all or part of her estate is taken by eminent domain?
Yes, the lessee is entitled to a share
True or false: at common law the landlord had a duty to make the premises safe
False, at common law the landlord had no duty to make the premises safe. Subject to 6 exceptions
What are the exceptions to the common law rule that a landlord had no duty to make the leased premises safe?
(1) concealed dangerous conditions (latent defects)
(2) common areas
(3) public use
(4) furnished short-term residences
(5) negligent repairs by landlord
(6) landlord contracts to repair
What is required of the landlord under the concealed dangerous condition exception to the prohibition on landlord tort liability?
If at the time the lease is entered into, the landlord knows of should know of a dangerous condition the the tenant could not discover by reasonable inspection, the landlord must disclose. If she fails, the landlord will be liable for any injuries resulting from the condition.
Does a landlord have a duty of reasonable care in maintaining common areas?
Yes, in places such as halls, elevators
When is a landlord liable to members of the public?
(1) she knowns or should have known of a dangerous condition;
(2) has reason to believe the tenant may admit the pubic before repairing the condition; AND
(3) fails to repair the condition
What is the modern trend regarding tort liability of a landlord?
courts are now holding that landlord owes a general duty of reasonable care toward residential tenants and will be held liable for injury resulting from ordinary negligence if he had notice of defect and a opportunity to repair it.
What is a fixture?
it is a chattel that has been so affixed to land that is ceased being personal property and has become part of the realty.
Does a fixture pass with the ownership of the land, or through the owners personal property
It passes with ownership of the land
When are items likely to be considered sufficiently “affixed” so as to call them fixtures?
(1) they are so incorporated as to lose their identity (bricks); OR
(2) items that are identifiable but whose remove would cause considerable damage
True or false: a common ownership case in the context of fixtures, is one in which the person who brings the chattel to the land owns both the chattel and the land
true
In a common ownership case in the context of fixtures what is the test for evaluating whether an item is a fixture of the property?
Ask: what was the objective intention of the party who may the annexation?
The intention is determined by:
(1) the nature of the article,
(2) the manner of attachment,
(3) the amount of damage that would be caused by its removal, and
(4) the adaptation of the item to the use of the realty.
What is a divided ownership case in the context of fixtures?
the chattel is owned and brought to the realty by someone other than the landowner.
May the landlord and a tenant agree on whether an annexed chattel is a fixture?
Yes, and it will be controlling
May a tenant remove a chattel she installed?
yes if the removal does not substantially damage the premises or destroy the chattel
What are the common nonpossessory interests in land?
(1) easements
(2) profits
(3) covenants
(4) servitudes
What right to the land does an easement holder have?
the right to use another tract of land for a special purpose, but has no right to possess or enjoy that land
If no time limited is stated, how long is an easement presumed to be for ?
perpetual duration
What is an affirmative easement?
an easement that gives the right to the holder to make affirmative use of the land.
What is an negative easement?
One where the holder is entitled to compel the possessor of the servant tenement to refrain from engaging in an activity on the servant estate.
What are the only types of negative easements allowed?
(1) light
(2) air
(3) lateral and subjacent support;
(4) flow of artificial stream;
(5) scenic view in a minority of jurisdiction
What is an easement appurtenant?
an easement that benefits the holder in his physical use or enjoyment of another tract of land.
What is the (1) dominant tenement of an easement appurtenant? (2) The servient tenement?
(1) dominant is the tenement that will benefit from the easement
(2) servient is the tenement that is subject to the easement right
Does an easement appurtenant pass with the transfer of the benefited land if it is not mentioned in the conveyance?
Yes
Does the burden of the easement appurtenant pass with the servient estate?
Yes, unless the new owner is a bona fide purchaser with no actual or constructive notice.
Can an easement appurtenant be transferred apart from the dominant tenement?
No, it will pass with the transfer of the dominant tenement
What is an easement in gross
right to use the servient tenement independent of his possession of another tract of land. The easement benefits the holder, not a dominant tenement
Is an easement in gross transferable?
(1) no if it is for the pleasure of the easement holder (swimming in a pond on blackacre)
(2) yes if it is for commercial or economic interest
What methods may create a valid easement?
(1) express grant or reservation
(2) implication; and
(3) prescription
Must an express easement be memorized in writing?
Yes if its is over one year in duration, and it must be signed by the holder of the servient estate
how is an easement by implication created?
by operation of law. There are three types.
What are the three types of easements by implication?
(1) easement implied from existing use (quasi-easement)
(2) easement implied without any existing use
(3) easement by necessity
When is a quasi easement implied?
(1) prior to the division of a single tract;
(2) an apparent and continuous use exists on the servient estate
(3) that is reasonably necessary for the enjoyment of the dominant part; AND
(4) court determines that the parties intended the use to continue after division of the land
When does an easement by necessity arise?
when a landowner sells a portion of her tract and by this division, deprives one lot of access to a public road or utility line.
When an easement by necessity is created, who determines the location of the easement?
The owner of the servient estate
What are the requirements to establish and easement by prescription?
Use must be:
(1) open and notorious
(2) adverse
(3) continuous and uninterrupted
(4) for a statutory period
Does overuse or misuse of an easement terminate the easement?
No, the proper remedy is an injunction against the misconduct
Who has the duty to repair the easement?
the easement holder if he is the sole user; but if both parties are using, the court will apportion the costs
How can an easement be terminated?
(1) stated condition is the original grant of easement
(2) merger (same person acquires ownership of both the easement ant he serpent estate).
(3) Release by a deed of release
(4) Abandonment (demonstration by physical act an intent to permanently abandon the easement (non-use is never enough)
(5) Estoppel (oral expression of an intent to abandon committed in writing or accompanied by action)
(6) Prescription
(7) Necessity (easements created by necessity expire as soon as the necessity ends
(8) Condemnation and Destruction
What is a license?
a privilege granted to the license holder to go upon the land of another.
Is a license an interest in land?
No, it is a privilege that is freely revocable at the will of th licensor
True or false, a failed attempt at creating an easement will create a license
True
What is a profit?
A profit entitles the holder of the benefit to take some resources from the servient estate.
What rules of easements govern profits as well?
rules governing creation, alienation, and termination.
What happens when a profit is surcharged?
the profit may be extinguished.
What is a real covenant?
it is a written promise, normally found in a deed, to do something on the land, or promise not to do something on the land.
Does a real covenant run with the land?
yes, which means that subsequent owners may enforce or be burdened by the covenants
What are the requirements for a burden of a real covenant to run with the land (it will make any successor in interest to the burden estate bound the covenant as if she agreed to it herself)?
WITHN
Writing Intent for successors to be bound Touches and concerns the land Horizontal and Vertical privity Notice (actual, inquiry, or record notice)
What does it mean for a real covenant to touch and concern the land?
Negative covenants: touch and concern the land if they restrict the holder of the servient estate in his use of the part of the land
Affirmative covenants touch and concern the land if they require the holder of the servient estate to do something, which increase his obligation in connection with his enjoyment of the land.
What is horizontal privity?
At the time the promisor entered into the covenant with the promisee, the two must have shared some interest in the land independent of the covenant. (grantor-grantee, landlord-tenant, mortgage-mortgagor)
What are the requirements for a benefit to run i.e. the promisee’s successor in interest may enforce the covenant?
WITV
Writing
Intent that the successor be able to enforce the covenant
Touch and concern the land
Vertical Privity
What is the general remedy for a breach of a real covenant?
damages, if an injunction is pursued, it will be analyzed as an equitable servitude.
What is an equitable servitude?
covenant that , regardless of whether it runs with the land at law, equity will enforce against the assignees of the burdened land who have notice of the covenant.
What is the remedy when an equitable servitude covenant is broken?
an injunction
How may an equitable servitude be created?
writing that satisfies the statute of frauds, subject to one exception.
what is the one exception to the requirement that an equitable servitude be in writing?
where it is implied because of a common scheme or development
What are the requirements to create an equitable servitude?
WITNES
Writing (generally, with an exception)
Intent for the covenant to run
Notice (assignee’s have noice) (actual, inquiry, record)
Equitable Servitude
What are the defenses to enforcement of an equitable servitude ?
(1) unclean hands
(2) acquiescence
(3) estoppel
(4) laches
(5) neighborhood has changed so significantly that enforcement would be inequitable
What is the Common Scheme Doctrine?
Suppose A subdivides her land into 50 lots, and 45 deeds contain a restrictive covenant restricting the land to residential use, then subsequently grants one of the five deeds without the covenant to a commercial developer
Under the doctrine of equitable servitude, the court will imply reciprocal negative servitude to hold the unrestricted lot holder to the promise.
What two elements must be shown to establish a common scheme sufficient to enforce a negative equitable servitude?
(1) intent on the part of the developer to subject all parcels to a restriction;AND
(2) the defendant lot hold has notice of the promise contained in the prior deeds (actual, inquiry, or record)
How may an equitable servitude be terminated?
(1) written release
(2) merger of the benefited and burdened estate
(3) condemnation of the burdened property
Title by adverse possession is based on the statue of limitation for what cause of action?
ejectment
What are the elements of adverse possession?
(1) actual entry giving exclusive possession; that is
(2) open and notorious (sufficient to put the landowner on notice of the adverse possesser’s occupation);
(3) adverse (hostile);
(4) continuous thought the statutory period.
When does the statute of limitation for adverse possession begin to run?
whenever the true owner can first bring suit
When may an adverse possesses obtain the whole parcel without actually occupying an entire parcel?
(1) AP occupies a reasonable portion of the parcel; AND
(2) occupation is under color of title
What portion of a land does an adverse possessor gain title to?
only the land she actually occupies
When will occupation be sufficiently open and notorious in order to constitute adverse possession?
when the occupation must be sufficiently apparent to put the true owner on notice that a trespass is occurring
When will occupation be sufficiently hostile in order to constitute adverse possession?
when the possessor enters without the owner’s permission
When may an adverse possessor tack per own possession on to the periods of adverse possession of her predecessors?
When they are in privity
Is it required that an adverse possessor pay property taxes?
Generally, no
May a statute of limitation ever be tolled for purposes of adverse possession?
Yes, but only if the true owner was disabled (minority, imprisonment, insanity) at the time the cause of action accrued
When does the statute of limitations for adverse possession begin to run against the holder of a future interest in land?
Only when that interest becomes possessory
Is an adverse possessor bound by restrictive covenants contained in the true owners deed?
If she violates the covenant during the limitations period, then no, she takes free of the covenant.
If she complies with the covenant, she takes title subject to the restriction
Must a land sale contract be in writing with the signature of the party to be charged?
Yes, to satisfy the statute of frauds
If an oral land contract sale is entered in to, under what conditions will be exempt from the statute of frauds?
When the buyer completes 2 out of 3:
(1) takes possession
(2) makes substantial improvements
(3) payment of the purchase price
What is the doctrine of equitable conversion?
Once a land sale contract is entered into, the buyer is considered the owner of the real property, and the seller’s interest (money from the sale) is considered personal property
Who is entitled to possession of real property after the land sale contract is entered but before closing has happened?
The seller
Who bears the risk of loss once a land sale contract for has been signed?
the buyer
If a buyer dies after signing a land sale contract, may their heirs or devisees demand a conveyance of the land at closing?
Yes
If a seller dies after signing a land sale contract, are their heirs or devisees required to covey title at closing?
Yes
True or False: every land sale contract has an implied covenant of marketable title?
True
What is promised in the implied covenant of marketable title?
that the seller will provide marketable title at closing
What is marketable title?
title that is reasonably free form doubt.
In order to be marketable, must title be perfect?
no, but it must be free of questions that present an unreasonable risk of litigation
Is title acquired by adverse possession unmarketable?
Yes.
What nonpossessory interests in land will render title unmarketable?
(1) mortgages (that cannot be satisfied with the sale price of the current land contract)
(2) liens
(3) restrictive covenants
(4) easements; and
(5) significant encroachments
Will the existence of a zoning ordinance restricting property to certain uses render title unmarketable?
No
Will the fact that a property is currently in violation of a zoning ordinance make title unmarketable?
Yes
May a buyer enforce the implied covenant of marketable titled after closing has occurred?
No, the covenant extinguishes at that time and the seller is only liable for express promises make in the deed.
What is the remedy if title is not marketable?
the buyer must first notify the seller and give the seller a reasonable amount of time to cure.
If the seller does not cure, the buyer may sue for specific performance with abatement, damages, rescission, ad a quiet title suit as long as she files suit before closing
Is the closing date contained in a contract absolutely binding?
No, there is a presumption that time is not of the essence and a party can tender performance within a reasonable time after closing (2 months).
What is the calculation of damages for breach of a land sale contract?
market value on the date of the breach - the contract price + incidental damages
May a buyer seek specific performance of a land sale contract?
Yes, because land is unique
If a buyer wishes to proceed with a sale despite title being unmarketable, can she still seek a remedy?
Yes, specific performance with an abatement of the purchase price
When will a court recognize a warranty of fitness or quality in the sale of land?
When the sale is for a new construction house by the builder
Under what theories will a seller of an existing building be liable to the buyer for defects in the property?
(1) fraud
(2) active concealment
(3) failure to disclose
Is a general disclaimer in a land sale contact sufficient to limit a seller’s liability for defects?
No, the disclaimer must identify specific types of defects in order to be upheld
Who is protected under an owner’s title insurance policy?
the owner only
Who is protected under a lender’s title insurance policy?
any assignment of the mortgage loan
What does a deed do?
transfers title to an interest in real property
What are the formalities required for a valid deed?
(1) writing
(2) signed by the grantor
(3) reasonably identifies the parties and the land
What is required to convey real property by inter vivos gift?
(1) donative intent;
(2) delivery; AND
(3) acceptance
Will a void deed be set aside by the court if the property has passed to a bona fide purchaser?
Yes, void is void
Will a voidable deed be set aside by the court if the property has passed to a bona fide purchaser?
No
What deeds will be void?
Those that are:
(1) forged
(2) never delivered
(3) issued to a non-existing grantee
(4) obtained by fraud in the factum
What deeds will be voidable?
Those that are:
(1) executed by minors or incapacitated persons
(2) those obtained by fraud in the inducement
(3) duress
(4) undue influence
(5) mistake
(6) breach of fiduciary duty
What is required for a land description to be sufficient?
It must provide good lead to the identity of the property
What is the consequence if a land description contains a description that is too indefinite?
the title remains in the grantor, but the court may reform the deed
When will a court reform a deed?
(1) mutual mistake
(2) scrivener’s error
(3) unilateral mistake cause by misrepresentation or other inequitable conduct
What is required for a deed to be effective?
It must be:
(1) delivered and
(2) acceptance
What is delivery?
delivery refers to the grantor’s intention to make deed presently effective even if possession is postponed.
How may delivery be conducted?
(1) manual delivery
(2) notarized acknowledgement
(3) or any method showing the grantor’s intent to deliver
Is parol evidence allowed to show grantor’s intent to deliver?
Yes, but not to show that delivery is conditional
What requirements must be met to have valid delivery when grantor gives a deed to a third party with the intentions that the deed be given to the grantee?
(1) grant must give instructions to the third party directing her to give the deed to grantee; OR
(2) the third party must be the agent of the grantor
True or False: most states presume acceptance?
True
What are the three types of deeds used to coney property interests?
(1) general warranty deed;
(2) special warranty deed; and
(3) quit claim deed
What covenants are contained in a general warranty deed?
(1) seisen;
(2) right to convey;
(3) Encumbrances;
(4) Quiet Enjoyment;
(5) Warranty
(6) Further assurances
What is the covenant of seisen?
grantor covenants that she has the estate she purports to convey. She must have both title and possession at the time of the grant
What is the covenant of Right to Convey?
grantor covenants that she has the authority to make the grant. Title alone is sufficient to satisfy
What is the covenant against Encumbrances?
grantor covenants against the existence of physical (encroachments) or title encumbrances (mortgages)
What is the covenant of warranty?
grantor agrees to defend against reasonable claims of title by a third party and to compensate the grantee for any loss sustained by the claim of superior title
What is the covenant of Right for further assurances?
grantor promises to perform acts reasonably necessary to perfect title conveyed
What title covenants can only be breached at the time of conveyance?
seisen, right to coney, against encumbrances
What title covenants are breached only upon disturbance of the grantees possession?
future title covenants: Quiet enjoyment, warranty, further assurances
Do future title covenants run with the estate?
Yes
What is the special warranty deed?
a deed using the word grant, which creates by implication two assurances against acts fo the grantor ONLY:
(1) that the grantor has not conveyed the same estate or any interest therein to anyone other than the grantee; AND
(2) that the estate is free from encumbrances made by the grantor
What is a quitclaim deed?
a deed that releases what interest the grantor has.
What covenants are contained in a quitclaim deed?
No covenants are contained in a quitclaim deed
Who is protected by recording acts?
BFPs and Mortgagees
What does a recording act protect a BFP from?
secret interests perviously created and provide a mechanism for earlier grantees to give notice though recordation
Is recording required to have a valid deed?
No
True or false: proper recordation gives constructive notice of the first conveyance to everyone, so there can be no subsequent BFPs
True
What are the types of recording statutes?
(1) notice
(2) race-notice
(3) race
What who prevails in a notice jurisdiction?
a subsequent BFP prevails over a prior grantee who failed to record. They key is that the subsequent purchase had no actual or constructive notice at the time of the conveyance
Who prevails in a race-notice jurisdiction?
a subsequent BFP is protected only if she takes without notice and records before the prior grantee
Are donees, heirs, and devisees protected by the recording acts?
No, because they do not pay valuable consideration
True or false: a person who takes real property from a BFP will not prevail if that person had notice of a prior unrecorded conveyance.
False, a person who takes from a BFP is protected against any interest that the BFP would have prevailed against
What is included in actual notice?
knowledge obtained from any source
When does a person have record notice?
a subsequent purchaser will be held to have record notice only if the dee is question is reported in the chain of title, which means that is recorded in such manner that searcher could reasonably find it .
Does a wild deed give constructive notice?
No
True or False: a person may be charged with inquiry or record notice even if they make no affirmative inquiry into the chain of title/object of inquiry?
True
Is love and affection valuable consideration to make a subsequent purchaser of land a BFP?
No, the consideration must be of some pecuniary value
Is a subsequent purchaser charged with record notice of an instrument that is filed with the recorders office but then misindexed?
Yes, but they may have a cause of action against the recorder
What are the 6 types of security interests in land?
(1) Mortgage**
(2) Deed of Trust**
(3) Installment Land Contract**
(4) Absolute Deed
(5) Sale-Leaseback
(6) Equitable Vendor’s Lien
** most important
Who is the mortgagor?
the debtor
Who is the mortgagee?
the lender
What happens when someone creates a deed of trust?
the trustor gives a deed of trust to a third-party trustee, who is usually closely connected to the lender (the beneficiary).
When does a purchaser obtain legal title under an installment land contract?
when the full contract price has been paid off.
What does a forfeiture clause in an installment land contract allow a vendor to do?
cancel the contract, retake possession, and retain all money paid
True or false: the mortgage can be validly transferred without a note.
False. In some jurisdictions the note will automatically transfer with the mortgage; In others the transfer will be void.
True or false: If a note can be transferred without the mortgage but the mortgage will follow the note
true
What method of transfer will allow a transferee to become a holder in due course upon the transfer to her of a mortgagee’s interest in a mortgage?
If it is indorsed and delivered to the transferee
What are the requirements to become a holder in due course?
(1) the note must be negotiable in form (payable to the bearer, with a promise to pay a sum certain, and no other promises)
(2) note must be indorsed
(3) note must be delivered to the transferee
(4) the transferee must take the note in good faith and must pay value for it
What are the benefits of holder in due course status?
the holder in due course takes the note free of any personal defense of the maker, but is still subject to real defenses
What are the personal defenses?
failure of consideration, fraud in the inducement, waiver, estoppel, and payment
What are the real defenses?
infancy, other incapacity, duress, illegality, fraud in the execution, forgery, discharge in insolvency and any other insolvency
What is the effect of a mortgagor transferring her interest in the property to a transferee?
The grantee takes the property:
1) subject to the mortgage (not personally liable); or
(2) assuming the mortgage (becoming personally liable
If a transferee takes property assuming a prior mortgage, does the original mortgagor remain liable on the mortgage?
Yes, the mortgagor remains secondarily liable as a surety.
Who may a mortgagee sue on the debt of the mortgaged property when the mortgagor has transferred her interest to a transferee who has assumed the mortgage?
The mortgagee may sue either
What is the result if a mortgagor transfers her interest and the transferee takes subject to the mortgage, and the mortgage subsequently goes into default?
The loan may be foreclosed wiping out the transferee’s interest
What is a due-on-sale clause?
they allow the lender to demand full payment of the loan if the mortgagor transfers any interest in the property without the lender’s consent
May a mortgagee take possession of a mortgaged property upon default in a lien theory state?
In most states, No. Under the lien theory of mortgages, which states that the mortgagee is considered the older of a security interest only and the mortgagor is deemed to owner of the land until foreclosure.
May a mortgagee take possession of a mortgaged property upon default in a title theory state?
Yes, under the title theory, legal title is in the mortgagee until the mortgage has been satisfied and the mortgagee is entitled to possession upon demand at any time
True or False: all states allow non judicial power of sale, while some states allow for judicial sale.
false. All states allow judicial sale and some states allow nonjudicial sales through the power of sale
May a lender bid on a property it foreclosed upon?
Yes.
What does equitable redemption allow?
It allows the mortgagor, at any time prior to the foreclosure sale, to redeem the property by paying the amount due.
What is the effect on equitable redemption if the mortgage contains an acceleration clause?
the full balance of the note or mortgage must be paid to redeem.
What is statutory redemption?
In half the state, mortgagors are allowed to redeem the property for some fixed period after the foreclosure sale has occurred by paying the foreclosure price.
What is the general rule for priority of distribution of foreclosure sale assets?
a mortgage’s priority is usually determine by the time it was placed no the property.
Does a foreclosure destroy interests that are senior to that being foreclosed on?
No.
Does a foreclosure destroy interests that are junior to that being foreclosed on?
Yes, as long as the junior interest was joined in the foreclosure action
True or false: a purchase money mortgage has priority over mortgages liens and other claims that arise prior to the mortgagor acquisition of title.
True
True or false: the order that a mortgagee records its mortgage in is irrelevant to its priority.
False, a mortgagee’s failure to record may effect its position under certain recording statutes
In what order will the proceeds of a foreclosure sale be paid out?
(1) expenses of the sale, attorneys fees and court costs;
(2) the principal and a cured interest on the foreclose loan;
(3) any other junior interest in the order of their priority;
(4) any left over to the mortgagor.
What remedy does a junior interest that is not fully satisfied have against the mortgagor?
They may seek a deficiency judgment
What is the most common remedy available to a vendor in the event of a default of an installment land contract?
forfeiture.
What theories will a court employ to avoid the harsh result of forfeiture?
(1) equity of redemption (grace period to pay the accelerated full balance of the contract and keep the land)
(2) restitution (requires vendor to refund the purchaser any amount already pay that exceeds the vendor’s damages)
(3) treat as a mortgage (requires a foreclosure sale)
(4) waiver (vendors acceptance of late payments waives right of strict performance)
(5) Election of remedies
True or false: an owner of real property has the exclusive right to use and possess the surface, the airspace, and the soil of the property
true
True or false: A landowner is strictly liable if his excavation causes adjacent land to subside
true
True or false: a landowner is always strictly liable for damage to land and buildings caused by excavation.
False: the landowner only liable if it shown that the land would have collapsed in its natural state. If not, she is liable if the excavation was done negligently
What are the two major systems for determine allocation fo water in watercourses?
(1) riparian doctrine
(2) prior appropriation doctrine
Who owns the water under riparian doctrine?
those who own the land bordering the water course
Who owns the water under the prior appropriation doctrine?
those who are first to put the water to beneficial use
What are the remedies for a possessor for invasions on his land?
(1) trespass (land invaded by tangible physical object)
(2) private nuisance (land invaded by intangibles such as odors or noise)
(3) Continuing trespass
(4) Ejectment or unlawful detainer (equitable remedy)
