Review

Question 1

Can a remaindermen take from a life estate free from encumbrances where the life tenant failed to pay taxes or interest?

Answer 1

No!

Gov’t/mtgee can FORECLOSE on the property, which will CUT OFF the interest to the remaindermen

Question 2

In a fee simple subject to condition subsequent, how does grantor exercise RIGHT to terminate?

Answer 2

Must file an ejectment action

Question 3

What future interests follow the various estates in land?

Answer 3

Fee simple absolute = No future interest

Fee tail = Reversion (if held by grantor)

Fee simple determinable = Possibility of reverter

Fee simple subject to condition subsequent = Right of reentry/ power of termination

Fee simple subject to executory interest = Shifting/springingexecutory interest (3d party) [which is subject to the RAP!]

Life estate = Reversion (if held by grantor) Remainder (if held by a 3d party)

Question 4

How is JT destroyed?

Answer 4

“S-P-A-M”

1) SALE: JT can sell/trnfr her interest during her lifetime (EVEN w/o the knowledge/consent of the other tenants)

Buyer becomes a tenant in common
If there were originally 3 or more JTs, then among the remaining joint tenants the joint tenancy survives

Equitable conversion: simply entering into Kto sell severs JT

2) PARTITION: 3 variations to partition and sever a JT

A - Voluntary Agreement: peaceful severance (no need for ct to step in)

B - Partition in Kind: judicial action for physical division IF in best interests of ALL parties (more likely if the property is bountiful)

C - Forced Sale: judicial actionIF sale in best interests of ALL; proceeds divided proportionally (more likely when JT is in a single property)

3) AND MORTGAGE: Depends on jx theory…

Title Theory: mortgage/lien severs (minority rule)

Lien Theory: mortgage/lien does NOT sever (NY DISTINCTION: NYfollows this rule)

NON-EXAMPLE - Creditor

Question 5

How is liability in a lease handled under an assignment?

Answer 5

1) Assignment: T may freely transfer interest in whole

E.g. T1 has 10 months remaining on a 2-yr term of years.
T1 transfers all 10 months to T2.
Once assigned, LL and assignee are in privity of estate (each is liable to the other for the cov’ts in the original lease); BUT they are not in privity of K unless assignee assumed all promises in the orig lease

If lease is assigned AGAIN, the original assignee loses privity of estate and the NEW assignee is now in privity of estate w/ the LL

LL and assignor remain secondarily liable to each other (as there is privity of K)

NY DISTINCTION: default rule is no assignment (unless you get written consent from LL)

Question 6

What is theHold-Over Doctrine?

NOTE: NY Distinction

Answer 6

If a T CONTINUES to possess property after his lease is up, the LL can:

(i) evict T; OR
(ii) hold T to NEW TENANCY

Commercial T = May be held to a yr-to-yr (if the lease was for ≥ 1yr) OR mo-to-mo (if the lease was for < 1yr)

Residential T = can ONLY be held to mo-to-mo (REGARDLESS of lease term)

If there is NOTICE of rent increase BEFORE lease expires, then new tenancy will be at increased rent

NY DISTINCTION: The LL’s acceptance of rent subsequent to the expiration of the term will create an IMPLIED month-to-month periodic tenancy (unless otherwise agreed)

If a T who holds a lease of INDEFINITE duration, and henotifies LL of intention to VACATE premises, but fails to leave, the LL MAY CHARGE 2X the rent

Question 7

How does abandonment of easement work?

Answer 7

Easement holder must demonstrate by affirmative action the intent to never use the easement agains

NOTE: Mere NON-USE NOT enough to create abandonment; you need an AFFIRMATIVE ACT, showing intent to abandon

Question 8

What is common development notice?

Answer 8

When a developer divides land up into various pieces and limits their use, all future tenants can enforce against nonconforming tenant AS LONG AS

(1) Original developer recorded this in original deed AND
(2) Other land conforms

Question 9

What is a tenant’s duty to repair?

NOTE: NY Distinction

Answer 9

1) Lease is SILENT?
T must maintain (but nothing more) the premises ANDmake ordinary repairs

T must NOT commit waste (voluntary, permissive, ameliorative)

Fixtures: a T may NOT remove a fixture (voluntary waste)

Std: Objective intent

2) EXPRESS COV’T to maintain property?

At common law historically: T was liable for any loss to the property INCLUDING loss due to force of nature

Today’s majority view: T is off the hook for natural disasters (gives T the option to END lease)

NY DISTINCTION: T is off hook UNLESS he made express agmt to restore property when destroyed

Question 10

What are 2 implied promises in everyland K?

Answer 10

1) Seller promises to provide MARKETABLE title at the closing

Std = free from reasonable doubt (i.e. free from litigation or the threat of litigation)

UNMARKETABLE TITLE = Title acq’d by adverse possession (even if just PART of title) BUT, if the seller brings a successful c/a action to quiet title and is successful, then CAN sell

Encumberances (no servitudes or mtgs UNLESS waived by buyer)

[NOTE: seller has a right satisfy existing mtg w/ sale proceeds]

Zoning violations (BUT not when blackacre is subject to an adverse zoning req)

No Encumbrance if: (i) visible to buyer and (ii) enhances value of property

2) Seller promises not to make any false stmt of material fact

Seller is liable for failure to disclose LATENT material defects

Even if K states a general disclaimer of liability (e.g. “property sold as is”), it wont relieve seller from liability for FRAUD or FAILURE to disclose

Question 11

*What is a general warranty deed AND it’s 6 cov’ts?

Answer 11

Warrants against ALL defects in title, INCLUDING those due to grantors predecessors 3 present cov’ts whereSOL starts running from the instance of delivery at closing

1) Cov’t of seisin = promise that the grantor owns this estate
2) Cov’t of right to convey = promise that grantor has the pwr to trnfr (i.e. he’s under no RESTRAINT or DISABILITY like age/sound mind)
3) Cov’t against encumbrances = promise that there are NO servitudes or mtgs on blackacre

3 future cov’ts where SOL for breach does not begin to run UNTIL the breach occurs (e.g. the date of the disturbance)

1) Cov’t for quiet enjoyment = promise that grantee won’t be DISTURBED in possession by a 3d party’s lawful claim of title

NOTE: This includes freedom from possible Hold-Over.

2) Con’t of warranty = promise that grantor will defend grantee against lawful claims of title asserted by others (indemnification)
3) Cov’t for further assurances = promise that grantor will do what’s needed to perfect to the title in the future (post-closing)

Question 12

How is mtg priority determined?

Answer 12

Creditors MUST properly record interest to get priority

Std: 1st in time, first in right

EXCEPTIONS:

Purchase money mtg (loan for land acquisition): has superpriority against EXISTING non-PMM loanson property

NOTE: PMMs do NOT have superpriority vs. loans made SUBSEQUENTLY(i.e. the regular priority rules apply)

Subordination agmts are permissible

Question 13

What happens when a mtg’r sells land with a valid mtg in place?

Answer 13

Lien remains on the land SO LONG AS the mtg was properly recorded p/t rule of the recording statue(recording statutes protect both BFPs and mtg’ees)

Apply the recording system rules p/t the operative recording statute

“Assumed the mtg” - BOTH buyer and seller/debtor are personally liable to the creditor/mtg’ee

“Subject to mtg” - ONLY seller/debtor (not buyer) is personally liable to the creditor/mtg’ee [BUT if seller/debtor doesn’t pay, creditor will foreclose on land]

Question 14

What are 3 key features of the foreclosure process?

Answer 14

1) Judicial proceeding - Mtg’ee looks to land for debt satisfaction; Proceeding yields sale of land; proceeds go to (in order)…
a) attorney fees, costs; b) each interest in priority; c) surplus back to debtor
2) Deficiency action - when sale does NOT cover amount of loan, mtg’ee can bring a deficiency action against debtor for the shortfall
3) Termination - Once mtg is foreclosed, all jr interests to the foreclosing interest are TERMINATED (i.e. once sr creditors foreclose,land cannot be looked to again for satisfaction of junior lienholders)

BUT if jr forecloses, senior lienholders can STILL look to the land; land sold by junior lienholder at foreclosure sale taken subject to senior lienholders (buyer not liable, but land still has lien)

Necessary parties (creditors w/ interests below foreclosing party; the debtor/mtg’r) MUST be joined in the action OR they preserve their claim despite the foreclosure sale

Question 15

*Which language controls - that of K or deed?

Answer 15

Deed

Question 16

How does one terminate a deed?

Answer 16

You have to draw up a new deed.

NOTE: Destruction of deed and saying that you want to cancel it is NOT ENOUGH

Question 17

When is reformation possible?

Answer 17

(i) Mutual mistake
(ii) Drafting error
(iii) One party’s mistake – only if induced by misrepresentation or inequitable conduct

NOTE: Make sure the mistake/error is over something that is actually key to the agreement (don’t confuse acreage over physical desc)

Question 18

How do you create an affirmative easement?

Answer 18

“P-I-N-G” circumstances…

1) Prescription: acquired b/c of adverse possession
Adverse possession = C-O-A-H = - Continuous use for statutory period (NYS: 10 yrs);
- Open/notorious;
- Actual use;
- Hostile (no permission)

2) Implication: requiring (i) use that’s apparent; AND (ii) parties expect survival of easement b/c it’s reasonably necessary to the dominant tenement’s use/enjoyment
3) Necessity:if grantor conveys landlocked tenement easement will be implied (NOTE: the grantor can CHOOSE where to locate the easement)

Non-example: Neighbor buys adjoining land and later wants an easement

4) Grant: An easement that endures for more than 1 yr MUST be in writing (to satisfy SOF) that complies w/ the formal elements of a deed (deed of easement) Can and SHOULD be recorded

Question 19

What are fixtures and can they be removed?

Answer 19

Fixture = moveable chattel, by virtue of annexation to real property, objectively shows intent to improve (heating systems, custom storm windows, furnace, certain lights)

NOTE: Can also be fixture if not affixed but “uniquely adapted to the realty”

A T may NOT remove a fixture (voluntary waste) UNLESS

(i) Removed before lease ends AND
(ii) removal leaves no damage on premises

Fixture status determined by:

(1) express agreement (agmt that says no fixture);
(2) whether removal cause substantial harm (if so, yes); OR
(3) if it’s a COMMERCIAL piece of property, a commercial T prior to expiration of a lease is entitled to remove all trade fixtures (i.e.Trade Fixtures Doctrine)

NOTE: For trespasser annexation, they lose it and are liable for reasonable rental value on the land on which she annexed chatel

Question 20

What is the tenancy for years?

Answer 20

Lease for a FIXED PD of time (i.e. 2 DAYS – 50 yrs) (Estate for Years or Term of Years)

NO notice requirement for termination b/c agreement states at outset when lease expires

If term = +1 yr (366 days) must be in writing (SOF)

Question 21

If T has right to stay as long as she’d like, what interest is created?

Answer 21

A life estate determinable

Question 22

What is the Rule in Dumpor’s Case?

Answer 22

If a L consents to one transfer that would otherwise violate a covenant against assignment or sublease, he waives his right to assert that future transfers breach the lease

Question 23

What is a tenancy at will?

NOTE: NY Distinction

Answer 23

A tenancy for NO FIXED duration

Must be expressly agreed-to: if not, court will treat as implied periodic tenancy

Tenancy may be terminated by EITHER PARTY at ANY TIME (but a reasonable demand to vacate is usually needed)

NOTE: If lease gives only the L the right to terminate at will, a similar right generally will be implied in favor of the T

NY DISTINCTION: in NY the terminating LL must give a MINIMUM of 30 days written notice of termination

Question 24

What is an easement?

Answer 24

Nonpossessory interest entitling holder (dominant tenement) to some use of another’s land (servient tenement)

1) Can either be affirmative OR negative

Affirmative: go onto servient land and do something

Negative: bar servient landowner from doing something; ONLY”L-A-S-S” types, which must be in writing/sighed…

Light; Air; Support (underground);

Streamwater from artificial flow (irrigation)

2) Can either be apurtenant to land OR held in gross

Easement appurtenant to dominant tenement: directly benefits property of dominant tenement (i.e. must be 2 pieces of property)

Transfer: passes automatically w/ land trnfrEVEN w/o mention; except if purchaser of servient land is BFP w/o NOTICE

Easement in gross: personal pecuniary benefit to holder, NOT land(e.g. put up a billboard; swim in another’s pond).

Transfer: NOT transferable UNLESS commercial purpose (e.g. using a lake for fishing to benefit a tuna fish company)
3)Scope of easement: limited to terms of creation; no unilateral expansion

NOTE: If one goes beyond scope, the servient landowner may enjoin the use.

Question 25

What is a profit?

Answer 25

Name for an easement that entitles holder to enter servient land AND take from (i.e. from soil or substance of soil)

Minerals, timber, oil

Termination: When surcharged

Question 26

What is a license?

Answer 26

A mere privilege, freely revocable (unless estoppel applies), to enter land for a delineated purpose (weakest of the servitudes family)

May or may not be for consideration

Classic cases…

1) Tickets (e.g. movie)
2) Neighbors “taking at the fence”: when oral “easement” violates SOF, becomes license

Estoppel applies ONLY when licensee has invested substantial $/labor in reasonable reliance

E.g.: An oral attempt to create a perpetual easement

Question 27

When will a covenant “run with the land” (i.e. benefitting successors)?

Answer 27

First analyze BURDEN side then BENEFIT side…

Burden (hard): To run, you’ d need “W-I-T-H-N”…

1) Writing: the original promise has to be in writing
2) Intent: original parties intended covenant to run
3) Touch & concern land: the promise must affect the parties’ legal relations as landowners (and NOT simply as members of public at large)

E.g., homeowners assn. fees; covenant not-to-compete DO touch/concern

4) Horizontal AND vertical privity Horizontal privity refers to the nexus b/t original parties A & B requiring that they’d be in succession of estate (i.e. grantor-grantee; landlord-tenant; mortgager-mortgagee) <
1) Writing: see above
2) Intent: see above
3) Touch and concern land: see above
4) Vertical privity(ONLY): see above

Question 28

How do you create an express equitable servitude?

Answer 28

To create an equitable servitude that will BIND successors, there must be “W-I-T-N-E-S”…

1) Writing: original promise was in writing
2) Intent: original parties intended for promise to run and bind successors
3) Touch and concern the land: the promise must affect parties as landowners
4) Notice: the assignee of burdened land had notice of promise =
5) Equitable
6) Servitude

PRIVITY is not necessary!

Question 29

What is a cross-easement?

Answer 29

An easement implied for adjoining landowners who share a common wall or driveway

Question 30

What is the difference b/t a covenant and an equitable servitude?

Answer 30

1) IF π seeks monetary damages =covenant

2) IF π seeks injuction/equitable relief =equitable servitude

Question 31

How can an owner’s disability affect adverse possession?

Answer 31

SOL on an adverse possession claim will NOT run against a true owner who is afflicted by a disability (i.e. infancy, insanity, imprisonment) AT THE START of the adverse possession

CANNOT TACK!!!!!

Question 32

What is impact of AP on future interest?

Answer 32

AP can get the current interest, but future interest remains intact.

Question 33

What is adverse possession?

Answer 33

Possession, for a statutorily prescribed pd of time, can, if certain elements are met, ripen into TITLE

NOTE: IF AP happens in violation of recorded real covenant, AP takes free of that covenant.

NOTE: SOL begins to run against someone who holds a future interest that was created before the adverse possession commenced when the interest becomes possessory.

Question 34

What is color of title?

Answer 34

Document that purports to—but does not actually—give someone title to land

Question 35

May a claimant gain title to a tract of land by AP if she has color of title to the entire tract but occupies only a portion of it?

Answer 35

Yes, if there is a reasonable proportion between the portion occupied and the whole tract

Question 36

What are the features of a joint tenancy?

Answer 36

1) The right of survivorship:

When 1 JT dies, his share passes AUTOMATICALLY to surviving JTs

NOTE: Creditors can’t touch

NOTE: If second to LAST JT dies (i.e. only 1 is left), the JT ENDS

2) A JT’s interest is alienable but is NOT devisable (via will) or descendable (via intestacy) b/c of the right of survivorship

Question 37

Can vested interests be freely transferred inter vivos?

Answer 37

Yes and accessible to creditors.

Question 38

What are the 3 types of waste that a life tenant can commit?

NOTE: NY Distinction

Answer 38

REFERENCE: When estate CREATED

1) Voluntary or affirmative waste = overt conduct that causes a drop in value (i.e. willful destruction, consumption of natural resource on property) “PU-R-G-E” EXCEPTIONS…

Prior Use, meaning that prior to grant, the land was used for exploitation; life tenant can CONTINUE to exploit (unless otherwise agreed) and subject to Open Mines Doctrine (if mining was done on land, the life tenant can mine from existing mines, BUT NOT new ones) Repairs, meaning the life tenant may consume natural resources for

REPAIRS and MAINTENANCE

Granted, meaning the life tenant may exploit if GRANTED that right

Exploitation, meaning the land is suitable ONLY to exploit (e.g.a quarry)

2) Permissive waste or neglect = this occurs when the land falls into disrepair

The life tenant must simply MAINTAIN the premises in reasonably good repair

MUSTpay all ordinary TAXES and INTEREST on mtgs (NOT principal)

NOTE: if the life tenant fails to pay taxes or interest, the gov’t/mtgee can FORECLOSE on the property, which will CUT OFF the interest to the remaindermen

3) Ameliorative waste = the life tenant must not engage in acts that ENHANCE the property value, UNLESS all future interest holders are KNOWN and CONSENT

EXCEPTION: if changed conditions have rendered a piece of property UNIHABITABLE, we will allow a life tenant to tear down that structure and replace (Changed Condition Doctrine)

Policy = protects the sentimental value for future interests

NY DISTINCTION = Life tenant MAY make reasonable improvements UNLESS remaindermen object