Rights and Interests in Land Flashcards
Real property taxes are computed based on the property’s:
assessed value. Assessed value x Tax value = Property tax
The process by which government exercises its power to take private lands for public use is:
condemnation. The process is condemnation. The power is eminent domain.
What is not a governmental power:
deed restrictions are private restrictions on the use or sale of a property.
Under police power, building codes would determine:
the types of plumbing and electrical materials allowed. The height and structure requirements and methods of construction to be used are also determined by b building codes. Zoning codes determine acceptable land uses.
The term estate refers to:
the collection or bundle of rights held by someone who has a possessory interest in a piece of real estate.
When an individual or entity holds a claim against another’s property, it is a:
lien which secures payment of indebtedness.
Real property rights are those of:
land, government, and ownership. Not deed rights.
What would be used by a purchaser to reveal encroachments?
A survey would be used to discover zoning setback violations or encroachments.
Which lien has first priority?
Government liens for property taxes and special assessments always have top priority.
The grantor of a life estate may retain:
reversionary rights. Ownership in fee simple reverts to the grantor at the end of the life estate.
If Anna grants a life estate to Ben and specifies that title will be transferred to Carl upon the death of Ben, who has what interests?
Ben is the life tenant. Ben owns the property. Carl is the remainderman. Ann, the grantor, has a reversionary interest.
The holder of a fee estate:
has the right to sell, will, or give the property away, which is known as ALIENATION.
A married couple has been granted the right to occupy and use a 10 acre tract of land forever. What kind of estate does the couple hold?
A fee simple estate - the right to occupy and use land forever.
In most life estates, the life tenant may:
sell the property, lease the property, improve the property. They may not be willed because most life estates terminate upon death of the life tenant. One exception: a life estate per auto vie, in which the life of someone other than the life tenant is used as the measuring life.
Encumbrances are:
Liens, easements and restrictive covenants are encumbrances.
An estate that lasts only so long as a specified condition is met is known as a:
A qualified fee estate (defeasible estate) - a form of ownership that can be lost by violating a condition in the end granting the ownership interest.
The right of the government to establish zoning and land use laws is an exercise of:
Police power - the government’s right to enact and enforce laws to protect the health, safety, morals, and general welfare of the public (including land use laws).
The grantor of a qualified fee has set the requirement that the property “must be used only as a school”; this requirement is known as a:
Deed condition - used to create the requirements of qualified fee estates.
A leasehold estate with a definite expiration date that does NOT require notice by either party is:
an estate for years - has a specific termination date.
Which governmental right is exercised when the state acquires private property through condemnation and makes a payment of just compensation?
Power of eminent domain.
What is the difference between a freehold and leasehold estate?
Freehold estates are of indefinite duration. Leaseholds will terminate.
A holder/owner of a life estate (life tenant):
owns the property and has title and possession of the property. The remainder estate belongs to the party who will obtain title upon death of the measuring life.
An irrevocable right to use the lands of another is called:
an easement.
A holder of a freehold estate has rights of:
ownership.
What is not an estate of ownership?
An estate for years - is a right of possession, not ownership. Life tenancy, like all other freehold estates, is an estate of ownership.
What is not an interest in land?
Granting someone permission to use one’s land creates a license, which is not an interest in land.
Which estate does NOT terminate on the death of the holder of the estate?
Estate for years - a contract and terminates on the date specified in the lease, not upon death of the lessor or lessee.
The property Sam bought 30 years ago had an appurtenant easement for access. Twenty years ago the county built a new road and Sam has not used the easement since that time. When Sam sells the property, the easement:
remains in place and will transfer with the property. Easements can be terminated by release, merger, or abandonment. If an easement is abandoned and the property owner wants to have it returned, typically the servant property must prove abandonment in court.
Protection on a primary home against certain creditors is known as:
homestead rights - protect a primary home from foreclosure by certain lien holders.
Revocable, nonexclusive permission to use property is called:
a license - can be revoked and it typically gives nonexclusive permission to use a property.
General real property taxes are called:
ad valorem taxes - because the amount of the tax is based on the value of the property.
If property is abandoned or person dies intestate and without heirs, the property will escheat to the state. - PETE memory aid.
Escheat is the governments reversionary right when a property is abandoned. P - police power E - eminent domain T - taxation E - escheat
What is an estate?
An estate is an interest in property. There are two types: Freehold estates (estates of ownership) - indefinite duration ; Leasehold estates (estates of possession) - may be terminated.
Three freehold estates are: fee simple absolute; fee simple defeasible (qualified fee) ; life estate.
What are the three freehold estates?
fee simple absolute; fee simple defeasible (qualified fee) ; life estate.
What is the Fee simple absolute estate?
The greatest, most complete form of ownership.
What is the Fee simple defeasible ownership?
a “qualified” fee because this type of estate always has a condition that must be met. If the deed condition is broken, the estate may revert to the grantor or the grantor’s heirs.
What is a life estate?
An estate measured by someone’s lifetime. The person who will receive the property when the life estate ends holds a reversionary or remainder interest. If no remainder man is named, the estate reverts to the grantor or the grantor’s heirs.
What is a leasehold estate?
An estate of possession and is a non ownership interest in property. The lessor (landlord) accepts rent from the lessee (tenant) in exchange for possession.
There are four types of leasehold estates:
Estate for years
Estate from period to period
Estate at will
Estate at Sufferance.
What are the four types of leasehold estates?
Estate (tenancy) for years - specific termination date. No advanced notice required. Specified beginning and end date. Tenant expected to vacate without notice. “Binding contract”. Death of landlord or tenant does not terminate the contract. Sale of property does not terminate. Purchaser of property can buy subject to existing lease.
Estate from period to period (periodic estate tenancy) - renews automatically for set period upon payment of rent. Terminated by advance notice of either party.
Estate (tenancy) at will - Indefinite duration - tenant occupies at landlord’s discretion. No fixed term. Terminated by notice, death, or sale of property.
Estate (tenancy) at sufferance - Holdover tenant after legal tenancy expires (lowest estate). Owner may evict tenant or accept rent. If rent is accepted from tenant at sufferance estate at sufferance becomes a periodic estate. Created when a tenant remains in possession at the end of agreed lease term without consent of landlord. Tenant gives notice to vacate but stays on after. “Three day notice to pay or quit” - first step in the eviction notice. The landlord files “unlawful detainer” - legal name for eviction.
What is an encumbrance?
An encumbrance is any right, claim, or interest in property held by someone other than the property owner or the one who has legal right of possession. There are four kinds of encumbrances: Easements Encroachments Deed restrictions Property liens
What are the four encumbrances.
Easements
Encroachments
Deed restrictions
Property liens
What are easements?
Easements are the right to use the lands of another for a specific purpose.
Appurtenant easement - has a dominant tenement (landlocked property owner) and a servient tenement (burdened by easement). Transfers with the land. doesn’t increase dominant estate’s size, but may increase in value.
Easement in gross - has no dominant tenement, only servient. Commercial easement held by company, government, or person. ie., utility easement.
Easement by necessity - granted by the courts to a private owner to precent creation of landlocked property. It is only granted if there is no other access. This easement is only available to private owners and not public utilities, railroads, or governments.
Easement by prescription (by implication) - Owner knows for a long time and doesn’t prevent. If they did it for 5 years it is ok. This is the only easement that can be terminated by non-use after 5 years.
Three ways easements can be terminated?
Merger - holder of dominant interest acquires the fervent property or vice versa.
Release - holder of dominant interest releases rights to servient owner (via quitclaim deed). Unless the easement is released, it will transfer with the deed.
Abandonment - not automatic. It must be proven in court. Easement is lost if it is unused for 5 years. Only applies to “easement by prescription”
What are Deed restrictions?
Privately created limitations on land use. They apply to present and future owners. I.e. restrictive covenants imposed on all lots within a subdivision by the original developer. Like the Homeowners Association.
Common deed restrictions are CC&R’s
Covenance - a fine if broken
Conditions - a fine if broken
Restrictions - goals is to maintain property values.
Need 2/3 vote of HOA to change restrictions.
What is a lien?
A lien is a financial encumbrance against property. Dollar burden attached to property. Money claim. May be specific or general.
Specific liens - against a specific property. Most common are government real property tax liens, mechanic’s liens (construction liens), and mortgages.
Judgement and IRS liens are general liens against all of a person’s assets.
What is a voluntary lien?
One agreed to by property owner (mortgage).
Involuntary lien?
One imposed without agreement of property owner (government tax, mechanics, judgement lien)
Tax lien has priority regardless of date of records.
Specific lien?
Applies only to identified property (mortgage on specific parcel of real estate).
General lien?
Applies to all property the debtor owns, such as a judgement.
What is an encroachment?
An unauthorized use of someone else’s property, typically physical object intruding onto neighboring property. Most encroachments are unintentional. A survey would reveal an encroachment.
What is a license?
Similar to an easement - grants permission to enter another’s property for a specific purpose. A license does not create an interest in property and is not an encumbrance against the title. A license can be revoked at any time.
What is an escheat?
The government’s reversionary right when a property is abandoned. It is exercised when owner dies intestate (no will) and without heirs. Government has 2 years to seek heirs (due diligence). They can hold property for 3 years.
What is a homestead exemption?
Created by state statue to protect a primary residence against creditors. It protects against forced sale on judgments and debits for personal loans and credit cards.
Typically does not protect against mortgage liens, property tax liens, or mechanics’ liens that are attached to the real property.
Amount of protection differs in value of homestead rights and who may receive them.
Homestead value protection amount:
Single person: $75,000 of equity is protected
Family unit: $100,000 of equity is protected
Persons age 65 or older, the disabled, or persons age 55 or older with low income: $175,000 of equity is protected.
Homeowners equity is: Market value of home - any liens and encumbrances.
Homeowners equity is =
Market value of home - any liens and encumbrances.
Ingress is:
the right to enter a property (easement)
Egress is:
the right to exit a property (easement)
Two ways the government can acquire privately held land:
escheat and eminent domain
Public control of land use by the government is known as:
Police power
A right to use or enjoy that one person has in the lands of another for a specific purpose is an:
easement.
Dominant tenement - benefits
Servient tenement - burdened
Easement in gross - only a servient property burdened by utility company.
A tenants right to possess real estate for the term of a lease is a:
Leasehold estate - aka, “Less than freehold estate” (Chattel real - real property interest (LEASED)
(Chattel - tangible, moveable personal property (OWNED)
A tree limb that overhands into a neighbor’s yard is an example of an
encroachment.
What is not revocable where as a license is?
An easement.
A claim that one person has against the land of another to secure payment of a debt is a:
lien (payment, cash, money).
Liens can be specific or general, voluntary or involuntary.
A person who has not been paid for work performed on real property may record a:
Mechanics’ lien. Can be placed by licensed contractors, workers, or suppliers for materials of work done on a property.
A party wall or a shared driveway is an example of an:
Easement appurtenant. AKA: an easement of ingress and egress.
The right of an owner to occupy a parcel of real estate forever is a:
fee simple absolute - the highest form of estate of ownership.
The type of lien that takes priority over all others is:
a Government lien (for property taxes). Doesn’t follow the rule of “first in time, first in right”
As part of their right to govern land use, local municipalities enact and enforce:
Zoning ordinances.
A freehold estate is an estate of ownership with an:
indefinite duration.
Leasehold estates are estates of possession with a:
definite duration.
Zoning laws are set at a:
local level.
What is a freehold estate?
Land ownership that can be held for an unlimited time, or the period of ownership may be limited in some way.
What is a fee simple estate?
AKA “present possessory interest”. Carries the maximum bundle of rights. Right to use property now and for indefinite period in the future.
What is a fee simple absolute?
Highest, most complete form of ownership.
What is a fee simple subject to a power of termination (fee simple defeasible)?
If the right of possession is restricted in some way.
A fee simple estate may be granted subject to a:
limitation on the use of the property or a condition that the property holder must or must not perform. The power of termination expires 30 years after the recording of the document creating it unless extended for another 30 years.
A power of termination:
will not expire during the lifetime of the grantor, if the grantor is a natural person and made without consideration to a governmental entity or a tax exempt organization.
What is a fee simple estate subject to a condition subsequent?
Some action or activity that the fee simple owner must no perform. If the condition is broke, the former owner can retake possession of the property. Enforcement of a fee simple subject to a power of termination or condition subsequent is by filing a notice of that intention of bringing a civil action.
What is a life estate?
The owner of a life estate has the right to possession and use of the property, bu the estate lasts only as long as the life of a person(s) identified in the deed or will that creates the estate. The measuring life is that of the holder of the life estate.
When the right of possession returns to the original property owner when the estate ends,
the original owner has reversion.
If the right of possession goes to a third person when the life estate ends,
the person has a remainder.
The holder of the life estate (life tenant) must:
keep up the property and taxes. If life tenant pays debts, i.e. mortgage, this benefits the reversioner and remainder man so life tenant is entitled to reimbursement.
Value of the life estates is based on:
the life expectancy of the individuals against whose life the estate is measured.
The use of life estate can be transferred by:
gift, lease, or sale, but the right to use and possession ends with the measuring life.
Special cases where life estate is measured life of someone other than the holder. If life tenant dies before that of which the estate life is measured,
the life tenant’s interest passes to that person’s heirs and will last until the end of the measuring life. The reversioner or remainder man can give, sell, or lease that interest, but no right of possession will take effect until the termination of the life estate.
