Section 3: CA Property Ownership Flashcards
Real Property and the Bundle of Rights; Real Estate, Real Property, and Personal Property; Forms of Real Estate Property Ownership; Real Estate Trusts
Land + air/space
+ attached nature
+ underground
Definition of Land
Land + attached items
Definition of Real Estate
Real Estate + rights
bundle of rights included in property ownership
Definition of Real Property
The right to draw water from underground resources (such as wells) for the landowner’s use.
PERCOLATING
The right to access and use rivers, streams, and other flowing bodies of water adjacent to the property.
RIPARIAN
The right to access and use ponds, lakes, oceans, and other stationary bodies of water bordering the property.
LITTORAL
A legal doctrine that grants water rights to the first individual or entity to take water from a source for beneficial use. It s granted by the state based on need and use rather than adjacency.
Doctrine of Prior Appropriation
The property is owned and may be possessed by the title holder.
The right of
POSSESSION
(bundle of rights)
The owner controls the use of the property. OR the right to determine interest in the property for others.
The right of
CONTROL
(bundle of rights)
The right to decide who may or may not access the property. OR the right to refuse other interests in your property
The right of
EXCLUSION
(bundle of rights)
The ability of the owner to use the property in any legal manner. OR The right to possess the land without harassment or interference
The right of
ENJOYMENT
(bundle of rights)
The right to sell or convey the property.
The right of
DISPOSITION
(bundle of rights)
Land isn’t interchangeable. One piece of land isn’t exactly like another.
UNIQUENESS
physical characteristics
While improvements may deteriorate over time, the land itself can’t be destroyed.
INDESTRUCTABILITY
physical characteristics
The geographic location of a piece of land is fixed; it can never be changed.
IMMOBILITY
physical characteristics
What Real Property Use are these:
- Single-family homes
- Multi-family dwellings
RESIDENTIAL
What Real Property Use are these:
- Restaurants
- Retail stores
- Hotels
- Parking facilities
COMMERCIAL
What Real Property Use are these:
- Light manufacturing
- Heavy manufacturing
- Warehouses
- Distribution centers
INDUSTRIAL
What Real Property Use are these:
- Timberland
- Pastureland
- Farms
- Orchards
AGRICULTURAL
What Real Property Use are these:
- Churches
- Hospitals
- Jails
- Courthouses
- College/university campuses
- Public schools
- Libraries
SPECIAL PURPOSE
A set of business laws created in the 1950s that regulate financial contracts dealing with personal property (not real estate itself). The code has nine articles, each dealing with different aspects of banking and loans.
The Uniform Commercial Code (UCC)
Whether the item is attached to the property and how permanent the attachment is
Method of annexation
Determining if an item is a fixture
How the item is situated or adapted to the real property.
Adaptability of item to land’s use
Determining if an item is a fixture
If there’s a dispute between the person who added the item and the person who removed it. The courts tend to favor a tenant’s take on an item over the landlord’s, and a buyer over a seller.
Relationship of the parties
Determining if an item is a fixture
A person’s original intentions may change over time, or an item that was intended to be temporary may end up physically attached to the property, which can change the item from temporary to permanent.
Intention in placing item on land
Determining if an item is a fixture
If the parties have agreed that an item will stay or go, then that agreement meets the legal test. To be safe, the agreement should be in writing.
Agreement of the parties
Determining if an item is a fixture
A form of legal life estate and refers to a WIFE’s interest in the real estate owned by her deceased HUSBAND. Dower isn’t recognized in all states.
DOWER
A form of legal life estate and refers to a HUSBAND’s interest in the real estate owned by his deceased WIFE. Curtesy isn’t recognized in all states.
CURTESY
The state’s power to claim property when an owner dies without a will and without heirs or creditors.
ESCHEAT
Provides the most complete form of ownership and includes the bundle of rights.
FEE SIMPLE ABSOLUTE
An inheritable freehold estate. Can will the property and/or successor can inherit the property.
FEE SIMPLE
Permits the recovery of fee simple ownership if certain conditions aren’t met.
FEE SIMPLE DEFEASIBLE
aka QUALIFIED FEE
The estate continues unless a specific even occurs, in which case ownership may revert to the owner or the owner’s successors. Usually recognized by the words “but if” in the deed.
FEE ON CONDITION
Estate that includes ownership, possession, and control for someone’s lifetime.
LIFE ESTATE
Abuse of a property by a person who holds interest through a life estate. The life tenant is responsible for reasonable property maintenance, repairs, etc.
ACT OF WASTE
LIfe estate is created by a property owner who grants an estate to someone for the duration of another individual’s life.
PUR AUTRIE VIE
A life estate in which property title reverts to the owner upon the death of the life tenant.
REVERSIONARY INTEREST
Refers to the remainderman’s right to fee simple title upon the death of the life tenant.
REMAINDER INTERESTS
A life estate with remainder interests refers to a situation in which a PERSON named by the owner when forming the estate receives title to the property upon the death of the life tenant.
REMAINDERMAN
Estate for a specified period of time; e.g., a one-year lease or a six-month lease.
ESTATE FOR YEARS
Renews itself automatically at the end of each lease period unless one of the parties to the lease terminates it. This type of lease often results when an estate for years ends.
A month-to-month lease is a periodic estate.
PERIODIC ESTATE
A tenancy for an unknown period of time. Either party can terminate the lease by giving notice to the other party.
ESTATE AT WILL
Estate that gives the owner special protections in property used as a family home.
HOMESTEAD
One person owns the property, and all other interests are severed.
ESTATE IN SEVERALTY
Each person is entitled to possession of the whole. If one dies, that person’s ownership is inheritable, and doesn’t necessarily pass to the other owner(s).
They don’t necessarily have equal interests in a property.
TENANCY IN COMMON
co-ownership
Equal ownership with undivided rights of possession and requires unity of four separate conditions:
1) all owners must have the same type of interest in the property,
2) all must receive their title at the same time from the same source,
3) all must have the same percentage of ownership,
4) all must have the right to undivided possession in the property.
Joint tenancy includes the right of survivorship, meaning when one joint tenant dies, that person’s share automatically goes to the other surviving joint tenant(s).
JOINT TENANCY
co-ownership
Has the right of survivorship. Only available to married couples, this form of ownership also includes unity of time, title, interest, possession, and marriage.
Tenancy by the entirety can’t be reduced to tenancy in common or joint tenancy. Such a change of ownership would require divorce, an annulment, or for the couple to amend the title.
TENANCY BY THE ENTIRETY
co-ownership
Joint tenants may sell their personal share of ownership; however, the buyer of that share does NOT become a joint tenant, because the required four unities do not exist. The new buyer didn’t receive a title at the same time as the other tenants, so the unity of time is destroyed.
Therefore, the new owner is a tenant in common. The remaining tenants continue as joint tenants, with the right of survivorship shared between them. The new buyer, as a tenant in common, has an inheritable share.
TERMINATION OF JOINT TENANCIES
A tenancy in common, each person is entitled to possession of the whole. To terminate, bring legal action to allow each tenant to have a specific, divided portion (partition) of the property exclusively.
In cases where it’s impossible to do an equitable split, a court may order the sale of the property and determine the appropriate share of proceeds to be distributed to the tenants in common.
TERMINATION OF CO-OWNERSHIP BY PARTITION
Is a land trust a revocable trust?
TRUE or FALSE ?
TRUE.
Because the trust is a grantor trust that’s revocable, they accept that transfer that it was done for estate planning. In fact, it’s protected under the Garn St. Germain Act (the federal depository act) that prevents lenders from accelerating notes whenever there’s a transfer into a grantor trust.
It is formed specifically to hold real estate—real property is the only asset within the trust.
A LAND TRUST
A testamentary trust avoids probate.
TRUE of FALSE?
FALSE.
Property placed in a testamentary trust does not avoid probate.
