Real Property _ Ownership Flashcards
Fee Simple Absolute
Estates in Land
- 100% of ownership forever
- infinite duration
A gives B property -> FSA / absolute ownership
Life Estate
Estates in Land
- Rights and control for life
- Cannot commit waste
- “O to A for life”
- Note: Life Tenants can’t commit waste; they MUST pay interest and taxes on the property. They DO NOT have to pay the mortage (Remainderman pays mortgage)
LE creates a reversion back to grantor OR it can create a remainder.
“O to A for life” = Reversion to O after A dies
“O to A for life, then to B” = A: LE & B: remainder
Reversion
Estates in Land
Interest goes back to grantor
Interest & Taxes
Life Tenant; Estates in Land
Life Tenant MUST PAY INTEREST & TAXES
Life Estate: Who pays the mortgage?
“O to A for life, then to B”
Estates in Land
RemainderMAN!
Remainderman pays the PRINCIPAL of the mortgage;
Life Tenant pays TAXES and INTEREST of mortgage
Vested Remainder v. Contingent Remainder
Estates in Land
Vested Remainder: Automatic transfer
vs.
Contingent Remainder: Subject to an event (if it fails, goes back to grantor)
Example:
Vested Remainder:
o Jon conveys Greenacre to you for your life, then
to Bob
Contingent Remainder:
o Jon conveys Greenacre to you for your life, then
to Bob if he’s married.
So if Bob isn’t married, then it goes to Jon after “you” pass.
Vested Remainder Subject to Open/Partial
Divestmen
Estates in Land
- Refers to a class of people
- One must be alive
Example:
o Jon conveys Greenacre to you for your life, then to
Bob’s children
Vested Remainder Subject to Total
Divestment:
Estates in Land
- If a person’s interest can be wiped out
Example:
o Jon to you for your life, then to C, but if C has no
kid’s then to D
Fee Simple Determinable:
Estates in Land
- “so long as” or “as long as”
- can be terminated upon the happening of a stated event
- conditions that violate public policy are struck down (ie. penalizing marriage)
- invalid if restraint on alientation; BUT courts todal uphold validity of Rights of First Refusal
Example:
o Jon conveys Greenacre to you as long as you use it
as a museum
Fill this in for Fee Simple Absolute
Estates in Land
Fee Simple Absolute
EX: “To {Person}”
Infinite Duration
Fill this out for “FEE SIMPLE DETERMINABLE”
Estates in Land
Present Estate: Fee Simple Determinable
Example: “To David and his Heirs [‘for so long as’] / [while]/[during]/[until]*
(Need to use statements of DURATION not motive/purpose)
* Duration: As long as conditoin is met, then automaitcally goes back to grantor
* Grantor future interest: Possibility of Reverter = Reversion
* 3P Future Interest: Fee Simple Subject to Executory Interest
Possibility of Reverter:
Estates in Land
- AUTOMATICALLY reverts to grantor if
condition is not met
Fee Simple Subject to Condition Subsequent:
Estates in Land
- If a future event occurs, then grantor has
right of reentry - “but if”
Example:
o Jon conveys Greenacre to you but if the Jets ever
win the Superbowl Jon gets the property back
Right of Reentry:
Estates in Land
Grantor must act to get the land back (physically, it’s not an automatic event like reversion)
Fill this out for: Fee Simple Subject to Condition Subsequent
Estates in Land
Present Estate: Fee Simple Subject to Condition Subsequent
Example: “To David & heirs [so long as][but it][upon condition that][provided that]
*NOTE: conveyance that contains both DURATIONAL LANGUAGE and a POWER OF TERMINATOIN will likely be construed as created a FSSCS because forfeiture is OPTIONAL
Duration: Until happening of stated condition AND reentry by grantor
Grantor’s Future Interest: Right of ReEntry
3P Future Interest: Fee Simple Subject to Executory Interest
Fee Simple Subject to Executory Interest
Estates in Land
FSSEI is a fee simple estate that terminates upon the happening of a stated event and then passes to a 3P rather than reverting to grantor or giving the grantor a right to terminate; the 3P has an executory interest.
EX: FSDF & FSSCS + “to 3P”
Duration: As long as condition is met / happening of event, then to 3P
Grantor’s Future Interest: N/A
3P Future Interest: Executory Interest
RULE AGAINST PERPETUITIES
Estates in Land
Rule Against Perpetuities:
* Interest must vest within 21 years of the life in
being
Joint Tenancy
Concurrent Estates
Joint Tenancy:
* Right of Survivorship
* Trumps a will
* Conveyance SEVERS a Joint Tenancy to
a Tenancy in Common
Rule:
A joint tenancy creates a right of survivorship whereby the surviving party takes a
decedent’s interest in a piece of property. To create a joint tenancy, four unities must be
present: (1) time; (2) title; (3) interest; and (4) possession. Additionally, the instrument
conveying the joint tenancy must state the right of survivorship.
Name and Define each of the 4 unities in a joint tenancy (and also right of survivorship)
Concurrent Estates
Time
The interest must be created at the same time.
Title
The interest to the joint tenants must be conveyed in the same instrument.
Interest
The joint tenants must have the same kind of interest and the same amount of interest.
Possession
All joint tenants must have the same rights of possession.
NOTE: Joint tenants all have an equal right to possess the whole property; however, joint tenants may choose not to exercise that right.
Right of Survivorship
Finally, the instrument conveying title must state the right of survivorship.
Severance of Joint Tenancy
Concurrent Estates
A joint tenancy is severed when one of the four unities is disturbed.
A joint tenant can convey what he or she owns, not the entire estate.
A joint tenancy may be disturbed by one joint tenant executing a mortgage.
An inter vivos conveyance severs a joint
tenancy.
When a joint tenant conveys his or her interest to another individual, the individual takes the property as a tenant in common.
Severance of Joint Tenancy
Lien Theory (Majority) v Title Theory (Minority)
Concurrent Estates
In a lien theory jurisdiction, a mortgage does not sever a joint tenancy because the mortgage is viewed as a lien, rather than a title transfer.
In a title theory jurisdiction, a mortgage severs a joint tenancy because once the mortgage is executed, title passes from the mortgagor to the mortgagee despite title returning to the mortgagor when the mortgage is satisfied.
