Real Property Distinctions Flashcards
Fee Simple Detreminable
Limited by specific durational language, terminates automatically.
Possibility of Reverter
Interest remaining in grantor following a fee simple determinable.
Not subject to RAP.
Fee Simple Subject to Condition Subsequent
Grantor reserves the right to terminate the estate with conditional language.
Requires re-entry.
Right of reentry
Interest remaining in grantor following a fee simple subject to condition subsequent.
Not subject to RAP and transferable.
fee simple subject to executory interest
Fee simple limited by durational or conditional language where the future interest is with a third party
executory interest
interest held by the third party following a fee simple subject to executory interest
Life tenant’s rights and duties
- right to possess
- right to collect rents/profits, lease or mortgage (must pay taxes on income or rental value of land)
- Duty not to commit waste
Kinds of waste
1) Affirmative
2) Permissive
3) Ameliorative
Ameliorative waste
A change in use of the property increases its value but changes its character. Permitted when a substantial and permanent change in the neighborhood makes it necessary in order to continue reasonable use of the property, so long as the property value is not diminished.
Reversion
Future interest in grantor following a life estate.
Remainder
Future interest in a third party following a life estate, subject to RAP.
Vested remainder
Not subject to any conditions precedent PLUS an ascertainable grantee
Vested subject to open
Vested in at least one member of the class, but the class is not closed.
Rule of convenience
Closes the class when any class member is entitled to immediate possession.
Shifting executory interest
Estate shifts from one grantee to another.
Springing executory interest
Estate shifts from grantor to a third party upon the occurrence of an event.
Rule Against Perpetuities
Future interests only valid if the must vest or fail by the end of a life in being plus 21 years.
Applies to:
- Contingent remainders
- Vested remainders subject to open
- Executory interests,
- Powers of appointment
- ROFR
- Options
Does not apply to charitable trusts.
Joint Tenancy Unities
Four:
(1) Possession
(2) Interest (must be identical)
(3) Time
(4) Title
In TX, no automatic right of survivorship
Rights and Duties of Co-Tenants
- Liable to other co-tenants for third-party rents
- Can collect contribution for operating expenses, but not for repairs or improvements
Types of tenancies
1) Tenancy for years (any fixed period of time)
2) Periodic tenancy (may occur with a holdover tenant)
3) Tenancy at will
4) Tenancy at sufferance (holdover tenant)
Termination of a Periodic Tenancy
For month-to-month, terminates on the later of the day given in the notice or one month after the notice.
For less than one month, terminates the day given in the notice or the day following the expiration period, whichever is later.
Changing the locks
With a commercial lease, a written notice must be placed on the front door. For a residential lease, the right must be provided on the lease, and the landlord has to give the tenant the new key upon demand.
Eviction Notice
Must provide at least 3 days notice.
Security Deposit
Residential landlord must return the security deposit within 30 days after the tenant surrenders premises, less damages or charges.
Anticipatory Breach
1) Maintain lease and sue for rent as it becomes due
2) Repossess, sue for present value of future rentals minus reasonable cash market value of property for the remainder of the term
3) Repossess, release the property, sue tenant for the difference
4) If lease permits, declare it forfeited and relieve tenant of liability for future lease
Warranty of habitability
Residential. Premises must be fit for basic human habitation.
Breach of the warranty of habitability
Tenant must notify landlord and give a reasonable time to repair, and tenant may refuse to pay rent and make reasonable repairs or seek damages.
In TX, the landlord must make a diligent effort to repair the condition if (1) tenant gives notice, (2) tenant is not delinquent when notice is given and (3) the condition materially affects the health and safety of an ordinary tenant
Covenant of quiet enjoyment
Tenant has a right to quiet use and enjoyment of the premises without interference from landlord. Landlord has a duty to control other tenants’ nuisance in common areas.
Kinds of Eviction
1) Actual
2) Partial
3) Constructive
4) Retaliatory
Tort Liability of Landlord
Modern trend - general duty of reasonable care and liability for defects existing prior to tenant’s occupancy, failure to make required repairs and criminal activities of third parties who injure tenants.
Attornment
Tenant’s acknowledgment of a new landlord. Usually arises in residential leases upon payment of rent to assignee, but formal acknowledgment may be required in commercial leases.
Assignment Limitation in Texas
Tenant may not assign or sublet without the prior consent of landlord.
Statute of Frauds Exception
- Part performance - buyer takes possession of the land, buyer remits all or part of the purchase price and/or buyer makes substantial improvements (requires at least two)
- Full performance
- Detrimental reliance
- Admission
Implied warranty of fitness
Only for new homes - requires disclosure of known material physical defects not readily observable/known to buyer.
Implied warranty of good and workmanlike construction cannot be disclaimed.
Implied warranty of habitability waived if buyer has knowledge of latent defects
Liquidated Damages
LDs of no more than 10% have been found to be reasonable.
Uniform Vendor and Purchaser Risk Act
- If property is destroyed or uninhabitable before tile or possession passes, the seller cannot enforce the contract and the buyer can recover any portion of the price paid.
- If title had passed, buyer must pay the contract price.
Adverse Possession
1) Continuous/uninterrupted for statute of limitations
2) Actual (open and notorious)
3) Hostile
4) Exclusive
Statute of limitations for adverse possession
25 years, except:
- 10 years if 160 acres or less and the claimant has cultivated crops or otherwise enjoyed the property
- 5 years if claimant has paid taxes, is claiming under deed, and has cultivated, used or enjoyed the property
- 3 years if tile or color of title seems irregular or was improperly recorded
Valid deed requirements
1) identified parties
2) grantor’s signature
3) words of transfer
4) reasonably definite property description (extrinsic evidence admissible)
Strips and gores doctrine
When the deed conveys land abutting a street, public highway, or railroad right-of-way, title to the center of the street or public highway, or railroad right-of-way passes by the deed.
Recording requirements
1) Signed by grantor
2) in the presence of two or more subscribing witnesses or before and certified by an officer authorized to take acknowledgments or oaths
Priority against subsequent purchasers for value
Pure notice in TX
Kinds of notice
1) Actual
2) Inquiry (reasonable investigation)
3) Constructive (properly recorded in chain of title)
Types of deeds
1) General warranty
2) Special warranty
3) Quitclaim
Warranties in General Warranty Deed
Present covenants:
1) Seisin - grantor owns land as described in deed
2) Right to convey
3) Against encumbrances - no undeclared encumbrance
Future covenants:
1) Quiet enjoyment
2) Warranty - Grantor to defend against third party’s claim
3) Further assurances - Grantor to do whatever future acts reasonably necessary to pass title perfectly
Texas protection of residences in mortgages
When the buyer of land to be used as a residence is in default after paying at least 40% of the amount due, or the equivalent of 48 monthly payments, seller may sell the buyer’s interest but may not enforce rescission or forfeiture and acceleration.
Methods of foreclosure
1) Judicially supervised sale;
2) Private sale
3) Strict foreclosure
4) Nonjudicial foreclosure if a power-of-sale clause exists
Statute of limitations for deficiency judgment
Action to recover deficiency must be brought within 2 years
Kinds of easements
1) Express
2) Implied by necessity
3) Implied by implication
4) Prescription (adverse possession, 10 years)
5) Estoppel
Transfer of easement
- Easement appurtenant - benefit transfers automatically with dominant estate
- Easement in gross - personal and not transferable unless expressly provided for in the instrument.
Termination of easements
1) Release in writing
2) Merger into title
3) Severance
4) Abandonment
5) Destruction/condemnation
Covenants running with the land
1) Writing
2) Intent
3) Touch/concern
4) Notice (for the burden to run)
5) Privity (horizontal for the burden to run and vertical)
Equitable Servitudes
Intent for restriction to be enforceable by and against successors
- Touch/concern (no privity required)
- Notice (actual, constructive or inquiry)
Water rights
In Texas, prior appropriation, but landowner owns groundwater.
Lateral support rights
Undeveloped - strictly liable to adjoining land.
Improvements - Strictly liable only if adjoining land would have collapsed in its undeveloped state, otherwise negligence-based.
Subjacent Support
Owner of the mineral rights is strictly liable to support the land and any buildings that were there there at the time of conveyance.
Texas homestead
Rural - no more than 200 acres for a family, 100 for an individual
Urban - Not more than 10 acres and property in city limits and served by municipality (fire, police, three utilities)
Nonjudicial foreclosure
For residential property, a notice of default must be served by certified mail and provide at least 20 days to cure the default before notice of sale will be given.
- After the 20 days’ notice, notice of the sale must be filed with the county clerk, posted on the courthouse door, and served on the debtor by certified mail at least 21 days before the sale date.
- Equity of redemption - The seller must notify a purchaser who is in default their right to cure the debt and allow the purchaser at least 60 days to do so.
