Real Property

Question 1

Remainders

Answer 1

A remainder is a future interest in a third person that can become possessory on the natural expiration of the preceding estate.

A remainder must be expressly created.

e.g. O Conveys to A for life, then to B and his heirs. B has a remainder.

O conveys to A for life then to B and his heirs one day after A’s death. B does not have a remainder because there is a gap.

Question 2

Can a remainder cut short a preceding estate?

Answer 2

No, and it can never follow a fee simple estate which is potentially infinite duration.

Question 3

what are the 3 types of vested remainder?

Answer 3

1) indefeasibly vested remainder
2) vested remainder subject to open
3) Vest remainder subject to total divestment

Question 4

Contingent remainder

Answer 4

Contingent remainders

(1) are those created in unborn or
(2) unascertained person or
(3) subject to a condition precedent

Question 5

Equitable conversion doctrine (buy/sell of land)

Answer 5

(1) When a buyer and seller enter into a land sale agreement, at the moment of signing, the buyer bears the risk of loss (buyer = equitable owner of the property).
(2) if the property is damaged or destroyed and that bearing the risk of loss is justified by the equitable conversion doctrine.

• Buyer should buy insurance at the moment of signing the purchase agreement to cover his liability.
  Court can order full contract price with specific performance.

Question 6

What does “good and marketable title” mean?

Answer 6

It means property is free and clear of all encumbrances

Question 7

Can a seller earmark a portion of the sale price in order to (pay off) / erase any encumbrances at the closing?

Answer 7

Yes

Question 8

what is a fixutre?

Answer 8

Definition: A fixture is a chattel that becomes attached to the real property.

Tip: when dealing with fixture question:
Check what type of property this is (i.e. residential or commercial property)

Residential property: The litmus test to determine whether a tenant can remove fixtures from residential property, is “how much damage will be caused to the property if the fixutre is removed”. (e.g. minimal damanage, yes tenant can remove. The more damage to the property, the more unlikely tenant can remove).

Commercial property: follows a “Trade Fixtures doctrine” - prior to the expiration of the commercial lease, a commercial tenant can remove all trade fixtures.

• Exception to trade fixtures doctrine: a commercial tenant will not be allowed to remove the trade fixtures, is if you are dealing with accession.

An accession is a structural addition to the real property (like a balcony) cannot be removed by any tenant.

Question 9

What is an accession?

Answer 9

An accession is a structural addition to the real property (like a balcony) cannot be removed by any tenant.

Question 10

What are the types of recording statute

Answer 10

1) Notice statute statute
2) Race recording statute
3) Race notice statute

Question 11

Shelter doctrine

Answer 11

The shelter rule is a doctrine in the common law of property under which a grantee who has received an interest in property from a bona fide purchaser will also be protected as a bona fide purchaser, even if the grantee would not legally qualify for this status.

Question 12

lateral and subjascent support means

Answer 12

A landlord has the right to have their land supported laterally and subjascently by their negibhoring land owner.
It means land in their “natural condition”, free of any human made structures.

If damages caused to your property due to neighbor removing too much lateral support, you will need to prove “negligent” on the part of neighbor. (under the theory of strict liability) for the damages to the land.

Question 13

If L leases property to T, and L subsequently assigns L’s interest to L2, whom may T hold liable when X, a paramount title holder, ejects T?

Answer 13

Ans: L or L2

f L leases property to T, and L subsequently assigns L’s interest to L2, T may hold L or L2 liable when X, a paramount title holder, ejects T.

A landlord may assign the rents and reversion interest that he owns. The assignee is liable to the tenants for performance of all covenants made by the original landlord in the lease, provided that those covenants run with the land.

The original landlord also remains liable on all of the covenants he made in the lease. X’s evicting T from the entire leased premises breaches the covenant of quiet enjoyment, which runs with the land. Thus, L and L2 are personally liable to T.

Question 14

Which of the following statements is correct regarding covenants against assignment or sublease?

A
If a tenant transfers her interest in violation of a covenant against assignment or sublease, the transfer is void.

B
A covenant against assignment prevents the tenant from subleasing her interest.

C
If a landlord consents to one transfer that violates a covenant against assignment or sublease, he waives his right to avoid future transfers.

D
A covenant against assignment or sublease is an unreasonable restraint on alienation.

Answer 14

C - Rule of Dumpor’s case

If a landlord consents to one transfer that violates a covenant against assignment or sublease, he waives his right to avoid future transfers. This is the Rule in Dumpor’s Case. The landlord may reserve the right to avoid future transfers, but such reservation must take place at the time of granting consent.

Question 15

An assignment

Answer 15

An assignee is in privity of estate with the landlord and is liable for all covenants that run with the land, including the covenant to pay rent. The original tenant (assignor) remains in privity of contract with the landlord and is liable for the rent reserved in the lease if the assignee abandons the property. Therefore, the tenant is liable to the landlord for the remaining rent.

Question 16

True or false

Clauses restricting assignment or sublease are not considered to be restraints on alienation.

Answer 16

True

Question 17

Does the landlord’s promise in a lease to maintain the property terminate upon sale of the property?

Answer 17

No, A landlord’s promise in a lease to maintain the property does not terminate because the property is sold.

Although no longer in privity of estate, the original landlord and tenant remain in privity of contract, and the original landlord remains liable on the covenant unless there is a ovation.

A novation substitutes a new party for an original party to the contract. It requires the assent of all parties and completely releases the original party.

Question 18

What is a novation?

Answer 18

A novation substitutes a new party for an original party to the contract. It requires the assent of all parties and completely releases the original party.

Question 19

What are the 2 ways for a tenant to transfer the right to possession under a lease?

Answer 19

There are two ways for a tenant to transfer the right to possession under a lease:

(1) assignment (transferring the entire period of time remaining under the lease) and
(2) sublease (transferring only a portion of the time remaining under the lease).

Restraints on alienation are traditionally strictly construed. Thus, a covenant prohibiting assignment does not prohibit subleasing and vice versa. Hence, this prohibition against assignment would not be read to include a prohibition against subleasing. A landlord would have no cause of action against the the original tenant.

If a tenant transfers (assigns or sublets) in violation of a prohibition in the lease against transfers, the transfer is not void, but the landlord usually may terminate the lease under either the lease terms or a statute. Here, however, there is no cause of action because subleasing was not prohibited.

Question 20

To acquire a prescriptive easement on property, the claimant’s use does not need to be __________.

Answer 20

Exclusive use is not required in order to acquire a prescriptive easement. Acquiring a prescriptive easement is analogous to acquiring property by adverse possession, except that the use need not be exclusive (i.e., the user may share the use with the owner or other easement claimants).

The use must be:

1. Open and notorious;
2. Adverse; and
3. Continuous and uninterrupted for the statutory period.

Question 21

If an easement is said to be surcharged, this means…..

Answer 21

If an easement is said to be surcharged, this means the easement’s legal scope was exceeded.

The holder of an easement has the right to use another’s land (i.e., the servient tenement), but has no right to possess the land.

The scope of an easement is determined by the reasonable intent of the original parties, and when the scope has been specified, these specifics will govern. However, when an easement’s scope has been set out only in general language, courts will interpret it to accommodate the holder’s present and future reasonable needs. In either event, if the easement holder uses the easement in a way that exceeds its legal scope, the easement is surcharged.

The servient landowner may enjoin the excess use and possibly sue for damages if the land has been harmed. However, the easement does NOT terminate by operation of law, nor does such use give the servient owner a power of termination.

Question 22

How will an easement be terminated?

Answer 22

Condemnation of the servient estate will terminate an easement. The easement holder may be entitled to compensation for the value lost.

Note:
Use of the easement beyond its legal scope will not terminate an easement. Instead, the easement is surcharged, and the servient owner may sue to enjoin the use.

Nonuse of the easement for the statutory period will not terminate an easement. An easement can be extinguished by the easement holder’s physical act of abandonment (e.g., erection of a permanent structure over the easement). However, mere nonuse, even for a long period of time, is insufficient to constitute an abandonment of the easement. To terminate the easement, the nonuse must be combined with other evidence of intent to abandon it.

Voluntary destruction of the servient estate (e.g., tearing down a building to erect a new one) will not terminate an easement. On the other hand, involuntary destruction of the servient estate (e.g., by fire or flood) will extinguish the easement.

Question 23

Is a long period of nonuse sufficient to terminate an easement?

Answer 23

Yes, a long period of nonuse is sufficient to terminate an easement if it is accompanied by other evidence of intent to abandon the easement (e.g., the easement holder erects a permanent structure blocking off the easement). However, a long period of nonuse on its own, even if it continues for the statutory period, is insufficient to constitute abandonment.
An easement MAY be terminated by prescription. However, this is not accomplished through the easement holder’s nonuse. Rather, one must interfere with the easement through long continued possession and enjoyment of the servient estate in a way that would indicate to the public that no easement right existed. This is analogous to a landowner losing title to land by adverse possession.
Generally, the release of an easement interest must satisfy the Statute of Frauds. However, a release is only one way to terminate an easement. A release from the owner of the easement interest to the owner of the servient tenement is effectively a conveyance and must satisfy the formalities required to create an easement. By contrast, an easement may be abandoned if the holder manifests an intent never to use the easement again, evidenced by either physical acts or oral expressions of a desire to abandon accompanied by a long period of nonuse.

Question 24

An easement implied by operation of law (quasi easement)

Answer 24

an easement implied by operation of law (“quasi-easement”). An easement may be implied if, prior to the time the tract is divided, a use exists on the “servient part” that is reasonably necessary for the enjoyment of the “dominant part,” and a court determines that the parties intended the use to continue after division of the property. To give rise to an easement, a use must be apparent and continuous at the time the tract is divided.

Question 25

License

Answer 25

a “license” (i.e., a revocable privilege) to use the land.

Question 26

Easement

Answer 26

an easement is an interest in land therefore, take note that the Statute of Frauds applies.

If an agreement between the landowner and the holder of the access was not in writing; the Statute of Frauds requirements for the creation of an express easement were not met, it would create a license instead of Easement.

Question 27

Easement by necessity

Answer 27

An easement by necessity is created when the owner of land sells a part of it and deprives the part sold of access to the public road.

Question 28

Prescriptive easement

Answer 28

To acquire a prescriptive easement, the use must be open and notorious, adverse, and continuous and uninterrupted for the statutory period.

Question 29

An easement by necessity

Answer 29

An easement by necessity arises when the owner of a tract of land sells a part of the tract and by this division deprives one lot of access to a public road or utility line. The owner of the servient parcel has the right to locate the easement, provided the location is reasonably convenient.

Question 30

Easement appurtenant

Answer 30

An easement is deemed appurtenant when the right of special use benefits the easement holder in her physical use or enjoyment of another tract of land.

The land subject to the easement is the servient tenement, while the land having the benefit of the easement is the dominant tenement. The benefit of an easement appurtenant passes with transfers of the benefited land, regardless of whether the easement is mentioned in the conveyance.

All who possess or subsequently succeed to title to the dominant tenement are entitled to the benefit of the easement.

e.g. The easement granted to the developer was an easement appurtenant because the right to use the private road across the northern parcel (the servient tenement) benefited the developer in her use and enjoyment of the southern parcel (the dominant tenement) by providing her with the most convenient access to the public highway. Thus, when the developer sold the benefited land to the investor, the benefit of the easement also passed to the investor as an incident of possession of the southern parcel.

Question 31

In a residential subdivision, will a commercial builder be bound by a residential-use restriction that was omitted from his deed?

Answer 31

Yes if the builder had inquiry notice of a common scheme for development.

An equitable servitude is a covenant (i.e., a promise to do or not do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of it. Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, in the absence of a writing, reciprocal negative servitudes may be implied if:
1. There is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant); and 2. The grantee had actual, record, or inquiry notice of the covenant.
Thus, the builder may be bound without actual notice of restrictive covenants in the deeds to other lots. In a residential subdivision, the builder would be on inquiry notice of a common scheme for development if the neighborhood appeared to conform to common restrictions. Thus, the builder would be bound by the residential-use restriction.
Even though there is no written restrictive covenant in the deed to the builder’s lot, the restriction may be enforced as a reciprocal negative servitude, discussed above.
To be bound by the restriction, the builder need NOT be in horizontal privity with the developer. Horizontal privity requires that the original parties to a real covenant shared some interest in the land independent of the covenant at the time they entered it (e.g., as grantor and grantee). Horizontal privity is required to enforce the burden of a real covenant at law, but it is not required to enforce the burden of an equitable servitude.

Question 32

Equitable servitude

Answer 32

An equitable servitude is a covenant (i.e., a promise to do or not do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of it. Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, in the absence of a writing, reciprocal negative servitudes may be implied if:
1. There is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant); and 2. The grantee had actual, record, or inquiry notice of the covenant.
Thus, the builder may be bound without actual notice of restrictive covenants in the deeds to other lots. In a residential subdivision, the builder would be on inquiry notice of a common scheme for development if the neighborhood appeared to conform to common restrictions. Thus, the builder would be bound by the residential-use restriction.

Question 33

Which of the following is not required for the burden of an equitable servitude to run to successors in interest?

Answer 33

Vertical privity between the covenantor and his successor in interest is not required for the burden of an equitable servitude to run to successors in interest. An equitable servitude is a covenant (i.e., a promise to do or not to do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of the covenant. The burden of an equitable servitude will run to successors in interest if: 1. The covenanting parties intended that successors in interest be bound by the covenant; 2. The successor in interest has notice of the covenant (if she has given value); and 3. The covenant touches and concerns the land (i.e., it benefits the covenantor and his successor in their use and enjoyment of the burdened land). Horizontal privity between the original covenanting parties and vertical privity between the covenantor and his successor in interest are not required.

Question 34

May a grantee be bound by a covenant that does not appear in his deed or chain of title?

Answer 34

A grantee may be bound by a covenant that does not appear in his deed or chain of title if there is a common scheme for development and the grantee had notice of the covenant. An equitable servitude is a covenant (i.e., a promise to do or not to do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against successors to the burdened land who have notice of the covenant. Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, in the absence of a writing, negative equitable servitudes may be implied if (i) there is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant), and (ii) the grantee had actual, record, or inquiry notice of the covenant.
Except as explained above, a grantee may not be bound by a covenant that does not appear in his deed or chain of title even if the covenant touches and concerns the land. The burden of an equitable servitude will run to successors in interest if: (i) the covenanting parties intended that successors in interest be bound by the covenant; (ii) the successor in interest has notice of the covenant; and (iii) the covenant touches and concerns the land (i.e., it benefits the covenantor and her successor in their use and enjoyment of the burdened land). In the absence of a writing, however, the servitude will not be enforced unless there is a common scheme for development as explained above.
A grantee may be bound by a covenant that does not appear in his deed or chain of title even if the deed contains a covenant against encumbrances. This is a covenant contained in a general warranty deed assuring that there are neither visible encumbrances (e.g., easements) nor invisible encumbrances (e.g., mortgages) against the title or interest conveyed. The presence of this covenant does not affect the ability of a successor in interest to the covenantee to enforce an equitable servitude.
A grantee also may be bound by a covenant that does not appear in his deed or chain of title even if the deed is a quitclaim deed. This type of deed conveys whatever interest, if any, the grantor has in the property. It does not affect the ability of a successor in interest to the covenantee to enforce an equitable servitude.

Question 35

What is required for the burden of an equitable servitude to run to a subsequent purchaser of the land?

Answer 35

For the burden of an equitable servitude to run to a subsequent purchaser of the land, the purchaser must:
(1) have notice of the covenant.

An equitable servitude is a covenant (i.e., a promise to do or not do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of it. The burden of an equitable servitude will run to a subsequent purchaser if:
1. The covenanting parties intended that successors in interest be bound by the covenant; 2. The purchaser has notice of the covenant; and 3. The covenant touches and concerns the land (i.e., it benefits the covenantor and his successor in their use and enjoyment of the burdened land). The requisite notice may be acquired through actual notice (direct knowledge of the covenants in the prior deeds); inquiry notice (the neighborhood appears to conform to common restrictions); or record notice (if the prior deeds are in the grantee’s chain of title he will, under the recording acts, have constructive notice of their contents). Thus, there the restriction need not be in the buyer’s record chain of title for the buyer to be burdened by it-as long as the buyer has some kind of notice.

Question 36

Horizontal Privity

Answer 36

Horizontal privity means the
(1) original parties to a real covenant shared some interest in the land independent of the covenant at the time they entered it (e.g., as grantor and grantee).

Horizontal privity is required to enforce the burden of a real covenant at law, but it is not required to enforce the burden of an equitable servitude.

Question 37

A common scheme for development

Answer 37

A common scheme for development is not required for the burden of a written equitable servitude to run to a subsequent purchaser.

(i) a common scheme for development existed at the time that sales of parcels in the subdivision began; and (ii) there was notice of the existence of the covenant to the party sued.

Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, reciprocal negative servitudes may be implied absent a writing if there is a common scheme for the development of a subdivision and the grantee had actual, record, or inquiry notice of restrictions that do not appear in his deed. The common scheme exception applies only to negative covenants and equitable servitudes; affirmative covenants must be in writing.

Question 38

What does a promise that touches and concerns the land mean?

Answer 38

a promise that touches and concerns the land. A covenant touches and concerns the land (1) when it makes the land itself more useful or (2) valuable to the benefited party.

Question 39

How is an equitable servitude created by covenants?

Answer 39

in writing to satisfy statute of fraud

Question 40

Reciprocal Negative Servitudes

Answer 40

Two requirements must be met before reciprocal negative servitudes will be implied:

(i) a common scheme for development, and
(ii) notice of the covenants.

The second requirement may be satisfied by actual notice, record notice, or inquiry notice.

Question 41

A private nuisance

Answer 41

A private nuisance is a (1) substantial,
(2) unreasonable interference with another person’s use or enjoyment of her property.

The interference must be offensive, inconvenient, or annoying to the average person in the community. It is not a substantial interference if it merely interferes with a specialized use of the land.