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MBE > MBE Rapid Fire > Real Property > Flashcards

Real Property Flashcards

1
Q

What are 4 types of present possessory estates?

A
  1. Fee simple absolute;
  2. Defeasible estate;
    • fee simple determinable;
    • fee simple subject to condition subsequent; and
    • fee simple subject to executory limitation
  3. Life estate;
  4. Non-freehold estates (leasehold estate)
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2
Q

What are the duties/obligations of a life tenant?

A
  1. Pay property taxes & mortgage interest;
  2. Make reasonable repairs;
  3. Not commit waste; and
  4. Pay insurance premiums (some jurisdictions)
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3
Q

What is the doctrine of waste and the 3 types of waste?

A

Life tenant must keep property in the same condition as when she took ownership.

3 types:

  1. Affirmative (“voluntary”) waste
  2. Permissive waste
  3. Ameliorative waste
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4
Q

What are defeasible fees and what are the 3 types?

A

A fee estate of potentially infinite duration that can be terminated upon the occurrence of a specified event

  1. Fee simple determinable
  2. Fee simple subject to condition subsequent
  3. Fee simple subject to executory interest
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5
Q

What is a fee simple determinable?

What type of language creates it?

A

Property interest that terminates automatically upon the happening of a named future event.

Created with specific durational language (“until,” “while,” “so long as”)

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6
Q

What is the future interest in a fee simple determinable?

A

Possibility of reverter: automatically reverts back to the grantor if condition happens

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7
Q

What is a fee simple subject to a condition subsequent?

What type of language creates it?

A

Gives grantor power/right to terminate interest upon occurrence of a specific event.

Created with specific, conditional language: “on condition that,” “provided,” “if”

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8
Q

If language identifying the type of defeasible fee is ambiguous, then what is the default treatment?

A
  • Fee simple subject to a condition subsequent is preferred over fee simple determinable (because there is no automatic forfeiture)
  • Covenant is preferred over a defeasible estate
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9
Q

What is a fee simple subject to an executory interest?

What type of language creates it?

A

An estate that is subject to a future interest by a third party, and upon occurrence of an event, the estate will automatically divest in favor of the third party.

Created with specific conditional language: “To A, but if A doesn’t finish law school, then to B and B’s heirs”

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10
Q

What types of future interests can a grantor have?

A
  1. Reversion (O conveys life estate);
  2. Possibility of reverter (O conveys fee simple determinable);
  3. Right of entry
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11
Q

Differentiate between the power of termination and possibility of reverter

A

Power of termination:

  • Must be expressly retained by grantor in the conveyance
  • When the event happens the property does not automatically revert back to the grantor, the grantor must re-take the property
  • Descendable; devisable, not transferrable inter vivos (majority rule)

Possibility of reverter:

  • Automatically created whether or not grantor expressly reserves the right in conveyance
  • When the event happens the property automatically reverts to the grantor
  • Descendible, devisable, transferrable
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12
Q

Define

contingent remainders

A

Remainders that are either:

  • Created for an unknown beneficiary (“To A for life then to B’s heirs” if B has no children yet); or
  • Subject to a condition precedent (“To A for life then to B and her heirs if B passes the bar”)
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13
Q

What is a vested remainder and what are the 3 types?

A

Interest that is:

  1. Created in an ascertainable grantee; and
  2. Not subject to any condition precedent other than termination of the preceding estate

Types:

  1. Indefeasibly vested
  2. Vested remainder subject to total divestment
  3. Vested remainder subject to open
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14
Q

What types of future interests are retained by third parties?

A
  1. Remainder
    • Vested
    • Contingent
  2. Executory interest
    • Shifting
    • Springing
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15
Q

What is an indefeasibly vested remainder?

A

Grantee takes possession upon termination of prior estate, no conditions attached

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16
Q

Distinguish a shifting vs. springing executory interest

A

Shifting: cuts short a third party’s interest (“To A and her heirs but if B passes the bar, then to B)

Springing: cuts short the grantor’s interest (“To A if she passes the bar”)

💡Memory tip:

ShifTing (divests third party)

SprinGing (divests grantor)

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17
Q

What are the main qualities of a tenancy in common?

A
  1. No right of survivorship;
  2. Freely devisable, transferrable, alienable;
  3. Right to possess the whole; and
  4. Right to partition
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18
Q

How is a joint tenancy created?

A

Must have the Four Unities (“PITT”):

  1. Unity of Possession: equal right of possession;
  2. Unity of Interest: equal interest with co-tenants;
  3. Unity of Title: same conveyance; and
  4. Unity of Time: interests created at the same time
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19
Q

What are two key differences between joint tenancy and tenancy in common?

A
  • A joint tenancy creates a right of survivorship and a tenancy in common does not
  • Tenancy in common only requires unity of possession (not the 4 unities like a JT)
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20
Q

Define

tenancy by the entirety

A

A joint tenancy between a married couple that has:

  • Right of survivorship
  • No right to partition
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21
Q

What happens when a joint tenant transfers the interest?

A

The joint tenancy remains intact between remaining joint tenants and the interest sold is held as a tenancy in common between all parties

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22
Q

If one joint tenant mortgages their interest in land, what happens in a lien theory vs. a title theory state?

A

Lien: JT is not severed

Title: JT is severed

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23
Q

What is a leasehold (landlord/tenant) estate and what are the 4 types?

A

Estate created & governed by a lease signed between the parties.

Types:

  1. Tenancy for years;
  2. Periodic tenancy;
  3. Tenancy at will; and
  4. Tenancy at sufferance
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24
Q

What are the 4 basic duties of a tenant?

A
  1. Pay rent;
  2. Not commit waste (affirmative/voluntary, ameliorative, or permissive);
  3. Not use the premises for an illegal purpose; and
  4. Protect third party invitees from foreseeable dangers on the premises
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25
Q

If the tenant abandons the property, is the landlord required to mitigate damages?

A

Majority: Yes, should make good faith effort to rent to other tenants and can seek damages from tenant for losses.

Minority: No, landlord can seek damages for all unpaid rent

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26
Q

What are a landlord’s tort liabilities?

A

Landlords have a duty of reasonable care → can be liable for injuries:

  • In common areas & non-common areas if defect is hidden;
  • From existing defects that landlord knew of and failed to notify tenant about;
  • From negligent repairs made by landlord; and
  • From failure to make repairs required by housing code
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27
Q

What is an assignment and to whom is the assignee liable?

A

Transfer of the entire lease to new tenant (assignee)

Assignee is in privity with landlord and liable for all rent owed to the landlord

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28
Q

If the property is condemned, does the tenant need to continue making rent payments?

A

If partial (tenant still has partial use of the property) or temporary: Yes, but tenant is entitled to compensation for dispossession from condemnation

If full condemndation: No

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29
Q

Can you transfer:

  1. An easement appurtenant?
  2. Easement in gross?
A
  1. Yes, transferred automatically b/c attached to the dominant estate. Does not need to be explicitly stated in the transfer.
  2. Not transferrable unless for commercial purpose
30
Q

What are 4 ways in which an easement can be created?

A
  1. Expressly (signed in, writing);
  2. Prescription;
  3. Implication; or
  4. Necessity
31
Q

What is an easement by implication and how is it created?

A

Easement implied by prior use.

Exists when:

  1. Easement existed on a single tract of land that was subsequently severed into the servient and dominant estate;
  2. Prior use was continous and apparent;
  3. Parties intended the easement to continue; and
  4. Easement is reasonably necessary for enjoyment of dominant estate
32
Q

When can an easement be implied without prior use?

A
  • If lots are sold in a subdivision with a recorded plat or map
  • If holder has a profit-à-prendre that makes it necessary to use the land to extract materials
33
Q

What is an easement by necessity and how is it created?

A

Easement is absolutely necessary to access the property

Created if:

  1. Dominant and servient estates were once a single parcel under common ownership; and
  2. Severance of the parcel made the easement absolutely necessary
34
Q

What happens if property is sold to bona fide purchaser without notice of the easement?

A

Easement is unenforceable against the BFP

35
Q

8 ways to terminate an easement

A
  1. Destruction of servient estate;
  2. Release;
  3. Abandonment;
  4. Estoppel;
  5. Severance;
  6. Prescription;
  7. Merger;
  8. Expiration; or
  9. End of necessity
36
Q

Differentiate between a license and an easement

A

Licenses:

  • Freely revocable (unless detrimental reliance or coupled with interest)
  • Privilege, not an interest in land
  • Can be created without consideration or writing (no SOF requirement)

Easements:

  • Last for specific period or indefinitely
  • Interest in land
  • Must satisfy SOF
37
Q

Elements for an equitable servitude

A
  1. Writing: original agreement in writing;
  2. Intent: original parties must intend to bind successors;
  3. Touches and concerns the land;
  4. Notice: burdened party had actual, record, or inquiry notice (not required for benefit to run)
38
Q

What is required for the benefit of a covenant to run with the land?

A
  1. Writing: original agreement in writing;
  2. Intent: parties intended benefit to run;
  3. Touches and concerns the land; and
  4. Successor is in vertical privity with original parties

⚠️ Horizontal privity is not required

39
Q

What is required for the burden of a covenant to run with the land?

A
  1. Writing: original agreement in writing;
  2. Intent: parties intended to bind successors (courts are liberal in finding requisite intent);
  3. Touches and concerns the land;
  4. Horizontal and vertical privity; and
  5. Notice: successor had notice of the covenant when she took
40
Q

Define

lateral support rights

A

Landowners have the right to lateral support from adjoining land

41
Q

Define

subadjacent support rights

A

Surface structures have the right to support from underneath the land.

Can arise if landowner allows another party mine, tunnel, or build an underground parking structure → party must ensure surface structures are adequately supported.

*Subjacent means “underground”

42
Q

What is zoning and from where is the power derived?

A

Governmental regulation and control of land use.

Derived from the police powers.

43
Q

When does a zoning regulation constitute a regulatory taking?

A

When it deprives the owner of ANY economically viable use

See Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978)

44
Q

What types of zoning regulations are invalid/void?

A
  • Discriminatory against suspect class (must show discriminatory purpose, not just effect);
  • Not rationally related to the general public welfare;
  • Unauthorized or in excess of authority; or
  • Too restrictive
45
Q

Define

mortgage

A

A security interest in real property between a borrower and lender that secures the performance of an obligation (typically repayment of a loan)

46
Q

Define

equitable mortgage

A

Lender secures the mortgage by taking possession of all the original title documents of the property. Lender has the right to sell the property, foreclose, and appoint a receiver if the borrower doesn’t pay.

47
Q

Who has the title and right to the property interest in a:

  1. Lien theory jurisdiction (majority)
  2. Title theory jurisdiction (minority)
A
  1. Lien: Mortgagor-borrower has title and right to possession. Mortgagee-lender has a lien on the interest.
  2. Title: Mortgagee-lender has title and right to possession
48
Q

If a mortgagor transfers the property, who is liable upon default if the buyer:

  1. Assumes the mortgage?
  2. Takes subject to the mortgage?
A

If the buyer/transferee “assumes” the mortgage:

  • Buyer/transferee is primarily liable for the loan
  • Mortgagor is secondarily liable unless released by transferee

If buyer/transferee takes “subject to” the mortgage:

  • Mortgagor is primarily liable
  • Buyer/transferee incurs no liability to repay the loan
49
Q

What is foreclosure?

A

When the borrower fails to make timely payments, the lender can foreclose on the property and use the proceeds to satisfy the debt owed

50
Q

Define

right of redemption

A

After default, at any time prior to the foreclosure sale, a debtor can redeem title to the property by paying the full debt amount

More info: Right of Redemption

51
Q

What is an acceleration clause?

A

Requires the borrower to pay the full amount owed upon default

More info: Acceleration Clause

52
Q

What are the 3 types of foreclosure?

A

Judical

  • ​​Sale is supervised by the court

Nonjudicial (“power of sale”)

  • Property is sold without court supervision
  • ​​Common in deed of trust states
  • Mortgage/deed of trust must contain a “power-of-sale” clause

Strict

  • Lender seeks court order for borrower to pay within a specified time frame. If borrower cannot pay, lender takes title to the property
  • Minority method
53
Q

In a foreclosure sale, who gets priority for the proceeds?

A
  1. Debts incurred by the foreclosure (attorney’s fees, etc); then
  2. Senior mortgages; then
  3. Junior mortgages
54
Q

How do you determine what interests take priority (i.e. which is senior and junior) in a foreclosure sale?

A

Generally, follow the “first in time, first in right” rule, unless an exception applies

55
Q

What are the exceptions to the “first in time, first in right” rule?

A
  1. Purchase money mortgage: Priority over all liens, regardless of when they were recorded
  2. Recorded mortgages have priority over unrecorded mortgages;
  3. Non-guaranteed advances from future-advance mortgages;
  4. Subordination by senior mortgagee to subsequent interest;
  5. Modification; and
  6. After-acquired property
56
Q

How are interests affected by a foreclosure sale?

A
  • Junior interests are extinguished
  • Buyer buys the property subject to the senior interests
57
Q

What is the Doctrine of Marshaling Assets?

A

Holder of a senior security interest must proceed:

  1. First, against property without junior security interests;
  2. Second, against property that has whichever junior interest was more recently created; and
  3. Lastly, against property that has whichever junior interest was more remotely created
58
Q

Elements of adverse possession

A

Trespasser’s possession is:

  1. Continuous for duration of statutory period;
  2. Open and notorious;
  3. Actual;
  4. Hostile; and
  5. Exclusive
59
Q

Requirements for a land sale contract to satisfy the SOF

A
  1. In writing;
  2. Signed by the parties to be bound;
  3. Contain essential terms of the deal (description of the land, consideration to be paid, etc)
60
Q

What defects render a title unmarketable?

A
  1. Encumberances;
    • Covenants
    • Easements
    • Mortgages
    • Liens
  2. Title acquired by adverse possession;
  3. ​Zoning violations;
  4. Incurable and undisclosed physical defects; and
  5. Future interests that have not consented to transfer
61
Q

What can the buyer do if they discover the title is unmarketable?

A

Notify the seller before the closing date and give them a reasonable time to cure defects

If seller doesn’t cure, buyer can seek specific performance, damages, and an action to quiet title

⚠️ If buyer doesn’t notify seller beforehand, deed controls b/c of the merger doctrine and seller is not liable

62
Q

What’s the doctrine of merger and its effect?

A

Once the deed is transferred/conveyed to the buyer, the contract merges with the deed and the deed controls, not the contract.

⭐️ This means that whatever obligations the seller had under the contract are not enforceable unless they are also contained in the deed.

63
Q

What is the doctrine of equitable conversion?

A

Helps determine who bears the risk of loss. Holds that once the buyer signs K to purchase land at a later date, but before closing:

  • Buyer has equitable title; and
  • Seller has legal title
64
Q

Under the doctrine of equitable conversion, who bears the risk of loss if the property is destroyed prior to closing?

A

Holder of the equitable title (the buyer), regardless of whether buyer took possession yet

65
Q

What’s the exception to the doctrine of equitable conversion?

A

Buyer will not bear the risk of loss if loss is attributable to the intentional or negligent acts of the seller

66
Q

What is required for a deed to be effective?

A
  1. In writing and signed by grantor;
  2. Describe the parties and the land;
  3. Delivered (i.e. seller must have present intent to transfer the interest)
67
Q

Define

general warranty deed

A

Contains 6 present and future covenants of title that cover the property’s entire history

Present:

  1. Seisin;
  2. Right to convey; and
  3. Against encumbrances

Future:

  1. Quiet enjoyment;
  2. Warranty; and
  3. Further assurances
68
Q

Define

special warranty deed

A

Contains the same covenants of title as a general warranty deed, but only for the period of the seller’s ownership of the land → does not contain any warranties for what happened before the grantor took ownership

69
Q

Define

bona fide purchaser for value (BFP)

A

Buyer who:

  1. Purchases property for value;
  2. Without notice of any prior claims
70
Q

What are the 3 types of notice?

A
  1. Actual;
  2. Record (also called constructive notice); and
  3. Inquiry
71
Q

Who prevails in a notice jurisdiction?

A

Subsequent bona fide purchaser who lacks notice of an earlier interest will prevail

72
Q

Who prevails in a race-notice jurisdiction?

A

First BFP to properly record

MBE Rapid Fire (8 decks)

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