Titles Flashcards
How does adverse possession (AP) work?
You need:
- Continuous/uninterrupted
-> through statutory period (e.g. 10 (many states), 15 or 20 years)
-> seasonal use okay if consistent with type of property (e.g. vacation home)
-> tacking permitted, but no gaps and via non-hostile connections only (e.g. descent, devise, contract, or deed) - Actual
-> open/notorious physical presence by AP or another whose possession is attributable to AP; constructive AP gives title to whole - Hostile - must possess the land without owner’s permission
-> majority of jurisdictions - ignore subjective intent, instead, must show objective intent to claim land as his own
-> minority of jurisdictions - consider subjective intent:
—–> good faith 0 must believe the property is unowned or that he owns it
—-> bad faith - aggressive trespass - Exclusivity - possession cannot be shared with true owner; but two or more people can adversely possess as tenants in common
How do you carry out the delivery of a deed?
At time of transfer, grantor must intend to make present transfer of property interest to grantee
-> typically, intent is shown by delivery of the deed
-> execution and recording - creates a rebuttable presumption that the deed is to be presently operative
-> parol evidence admissible to establish intent when grantor keeps deed
Transfer to grantor’s agent is not delivery but transfer to grantee’s agent is.
Transfer to third party with a condition Is not delivery if grantor keeps absolute right to recover deed, but if not, treated like future property interest.
If conditioned upon death, grantor must intend to make a present gift upon grantor’s death in order for it to be valid.
Acceptance presumed for beneficial transfers.
What is a deed?
A legal instrument that transfers ownership.
Many states allow real estate brokers to prepare real estate sales K; some states limit this to form Ks and some require attorney review
-> non-attorneys may prepare mortgage lending docs
-> jurisdictions are split as to requirement of attorney at closing, but non-attorney may not answer legal questions
Valid deed requirements:
- identified parties
- grantor’s signature
- words of transfer
- reasonably definite property description (extrinsic evidence is admissible)
Agent may execute deed
- equal dignities rule - agent authorization for real estate Ks must be in writing
What do recording acts do and are they required? What are the three different types of recording acts?
Recording a deed is not required for a deed to be valid and convey good title to the transferee. BUT recording acts are state laws that help resolve multiple claims of ownership against a real property.
- Notice statute
-> Bona Fide Purchaser (BFP) who is a purchaser for value without notice of prior interest PREVAILS over prior grantee who failed to record
-> must record in order to protect own interest (aka previal) in real property against subsequent purchaser (e.g., of a notice statute => “no conveyance/mortgage of real property good against subsequent BFP unless same be recorded according to law”) - Race statute (race to record it first)
-> first to record prevails - regardless of knowledge of prior conflicting interests (e.g., “no conveyance/mortgage of real property good against subsequent purchaser of value unless first recorded by law”) - Race-notice statute
-> subsequent BFP protected only if he takes without notice of a prior interest and is first to record (e.g., “no conveyance/mortgage of RP good against subsequent BFP unless first recorded by law”)
How does notice of recording acts work for recording statutes?
Notice - tested as of the time of the conveyance; notice obtained after conveyance does not prevent purchaser from benefitting from recording
-> actual - a grantee with actual, personal knowledge of prior interest cannot prevail under notice or race-notice statute
-> inquiry - if reasonable investigation would disclose prior claims, a grantee cannot prevail under notice or race-notice statute (e.g. of a situation that gives rise to inquiry notice = someone other than grantor has possession or documents referenced in chain of title)
-> record - grantee is held to have constructive notice of all prior conveyances that were properly recorded
What is title insurance?
Protects policy holder (owner or lender) against defects that could have been uncovered by careful title search or forged/undeliverable/unenforceable deeds.
What are the types of general warranty within a deed?
Present covenants
- seisin - grantor owns land as described in deed
- right to convey - grantor has right to transfer title
- against encumbrances - no undeclared encumbrances against land
Future covenants
- quiet enjoyment - grantee not disturbed in possession by third party’s lawful claim
- warranty - grantor will defend grantee against third party’s claim
- further assurances - grantor will do whatever future acts reasonably necessary to pass title if later determined title is imperfect
What is a special warranty within a deed?
Same covenants of title as general warranty deed, but only warrants against defects arising during the time grantor has title.
What is a quitclaim deed?
No covenants of title
How does a conveyance by will work?
The language can be a specific devise (states specific property that will be left to a specific person) or residuary clause (states property in general terms that will be left to a specific person)
Special situations
- ademption - devise of real property fails because the testator no longer owns the property upon death
- lapse - devise of real property can also fail if the beneficiary named in the will dies before the testator and no alternate beneficiary or is named
–> anti-lapse statute - prevents a gift from lapsing by (1) any named family heir’s estate receiving the gift if that family heir dies before the testator (statutes state that the family heirs are only immediate relatives), OR (2) if the person receiving the gift isn’t immediate family and they die before the testator, then the gift gets placed in the “residuary property” bucket and whoever is intended to receive that then gets it
How does conveyance by operation of law work?
It’s a form of intestate succession in which you simply follow the law
How does conveyance by trust work?
Trust - a fiduciary relationship wherein one or more trustees are called upon to manage, protect, and invest certain property and any income generated therefrom for the benefit of one or more named beneficiaries
-> inter vivos trust - created when the settlor (person who creates the trust) conveys his property (res) to the trustee while the settlor is alive
-> testamentary trust - created by the settlor in his will
-> pour over trust - created by settlor during his life but not funded until his death by a devise in his will
What are the differing forms of restraint on legal interests?
Disabling restraint - total prohibition on the transfer of the property interest by its owner; always VOID.
Forfeiture restraint - property is forfeited if the interest owner attempts to transfer his interest; restraint on a future interest or a life estate can be valid.
Promissory restraints - a promise by the property interest holder not to transfer the property interest; enforceable by an injunction or a suit seeking damages for breaking the promise; BUT restraint on a life estate can be valid.
What are prohibited restraints?
An absolute restraint on alienation of a fee simple is void because any person who owns a fee simple interest in real property has that right; any restraint based on race, ethnicity, or religion is not enforceable.
What are permissible restraints?
Restraints on the use of property (e.g. covenants) are generally permissible.
