California Real Estate Principles(13Th Ed.) Ch. 3

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Encumbrance

Back 1

a non possessory interest in real property that is held by someone who is not the owner. Anything that burdens or affects the title or the use of the property.

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financial encumbrances

Back 2

encumbrances which affect the title.

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Non-Financial Encumbrances

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encumbrances that affect the use of the property, such as an easement, a building restriction, an encroachment, or a lease.

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Types of non-financial encumbrances

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easements, building restrictions, and zoning requirements and encroachments.

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Lien

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an obligation to pay a financial encumbrance that may be voluntary of involuntary.

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Voluntary Lien

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A financial encumbrance created when an owner chooses to borrow money, using the property as security for the loan.

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Involuntary Lien

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A financial encumbrance placed against property when the owner does not pay taxes or a debt owed.

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Specified Lien

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A lien placed against a certain property, such as a mechanic's lien, trust deed, attachment, property tax lien, and lis pendens.

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General Lien

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A lien affecting all property of the owner, such as a judgment lien or federal or state income tax lien.

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All liens are encumbrances but ___________________

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_________________________ but not all encumbrances are liens.

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Trust Deed

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A security instrument that conveys naked legal title of real property.

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Mechanic's Lien

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may be placed against a property by anyone who supplies labor, services, or materials used for improvements on real property and who did not receive payment for the improvements.

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Notice of Non Responsibility

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A notice posted by the owner upon discovery of unauthorized work on their property. Must be recorded and posted on the property.

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Lien having priority over any other liens filed after the commencement of labor or delivery of materials(with the exception of government liens like taxes).

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A mechanic's lien has priority over

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Tax Lien

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Goes against the property when government taxes, such as income or property taxes, are unpaid.

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Special Assessments

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are levied against property owners to pay for local improvements, such as underground utilities, street repair, or water projects.

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Lis Pendens(pendency of action)

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a recorded notice that indicates pending litigation affecting the title on a property. Clouds the title.

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Attachment Lien(writ of attachment)

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The process by which the court holds the real or personal property of a defendant as security for a possibe judgment pending the outcome of a lawsuit. Valid for 3 years, does not terminate on death.

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A Judgment

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the final determination of the rights of parties in a lawsuit by the court.

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Abstract of Judgment

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A summary of the court decision. When it is recorded it is a general lien on all non-exempt property owned or acquired by the judgment debtor for 10 years in the county in which it is filed.

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Execution Sale

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A court ordered sale property to satisfy a judgment.

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Writ of Execution

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Issued to order an execution sale.

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Easement

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The right to enter or use someone else's land for a specified purpose.

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Ingress

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The right to enter onto a property using an easement

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Egress

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The right to exit a property using an easement.

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Easement In Gross

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An easement with no dominant tenement, the most common type of easement.

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Appurtenant Easement

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An easement which automatically goes with the sale of the dominant tenement. The deeds do not need to mention them for them to be valid.

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Servient Tenement

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The land giving the easement, or being used as an easement.

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Dominant Tenement

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The land receiving the benefit of an easement.

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License

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Permission to use property, may be revoked at any time. Not an easement.

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Easements are recorded

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The dominant tenement records it.

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Express Grant

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The servient tenement grants the easement this way, or by deed.

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Express Reservation

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How the seller of a parcel who owns adjoining land reserves an easement or right of way over the former property. Created at the time of sale with a deed or express agreement.

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Implied Grant or Reservation

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The existence of an easement is obvious and necessary at the time a property is conveyed, even though no mention is made of it in the deed.

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An Easement by Necessity

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Created when a parcel is completely land locked and has no access. Automatically terminated when another way to enter and leave the property becomes available.

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Prescription

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The process of acquiring an interest, not ownership, in a certain property.

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Easement by Prescription

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An easement created by continuous and uninterrupted use, by a single party, for a period of five years. Must be against owner's wishes, open and notorious.

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Requirements for Terminating an Easement

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ADAM E. LEE
Abandonment
Destruction of the servient tenement
Adverse possession
Merger
Express release
Legal proceedings
Estoppel
Excessive

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Abandonment

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The obvious and intentional surrender of an easement. Non-use: If the prescriptive easement is not used for a period of five years, the easement is terminated.

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Destruction of The Servient Tenement

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If the government takes the servient tenement for its use, as in eminent domain, the easement is terinated.

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Adverse Possession

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The owner of the servient tenement may, by his own use, prevent the dominant tenement from using the easement for a period of five years, terminating the easement.

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Merger

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If the same person owns both the dominant and servient tenements, the easement is terminated.

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Express Release

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The owner of the dominant tenement is the only one who can release an easement. A usual way would be to sign a quitclaim deed.

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Legal Proceedings

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In order to terminate an easement, the owner of the servient tenement would bring an action to quiet the title against the owner of the dominant tenement.

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Quiet Title Action

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A lawsuit to establish or settle title to real property.

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Estoppel

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A legal doctrine which prevents a person from denying something to be true or a fact which is contrary to previous statements made by that person.

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Restriction

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A limitation placed on the use of property, usually to assure that land use is consistent within a certain area.

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Private Restrictions

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Placed by a present or past owner and affect only a specific property or development.

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Zoning(public restriction)

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Government restrictions that benefit the public.

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CC&Rs

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Covenants, Conditions, and Restrictions.

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Declaration of Restrictions

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Gives each owner the right to enforce the CC&Rs.

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Covenant

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A promise to do or not do certain things.

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Injunction

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A court order forcing a person to do or not do an act.

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Condition

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Mostly the same thing as a covenant, a promise to do or not do something(usually a limitation on the use of the property) except the penalty for breaking a condition is return the property to the grantor.

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Condition Subsequent

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A restriction placed in a deed at the time of conveyance for future use of the property. Upon breach of the condition subsequent, the grantor may take back the property.

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Condition Precedent

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Requires that a certain event, or condition, occur before title can pass to the new owner. Must be taken care of preceding the transaction.

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Public Restrictions

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Primarily zoning laws which promote public health or general public welfare.

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Non-conforming use

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Legal use of property that at one period was established and maintained at the time of its original construction but no longer conforms to the current zoning law.

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Grandfather Clause

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An expression used in law that permits the continuation of a use or business to proceed because the current law denies permission.

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Variance

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An allowable difference to the zoning laws for a structure or land use. May be granted to someone who petitions to use property in a way that is currently prohibited by zoning laws.

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Encroachment

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A permanent improvement, such as a fence, wall, driveway or roof, that extends over the lot line into adjacent property owned by another.

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Homestead Property

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The home(primary residence) occupied by a family that is exempt from the claims of, or eviction by, unsecured creditors.

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Homestead Exemption

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A lien that protects a certain amount of equity in a person's home by limiting the amount of liability for certain debts against which a home can be used to satisfy a judgment.

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A Homestead Declaration

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A declaration of homestead is a recorded notice a property owner files to protect the equity in his or her real property. Only protects real property.

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Abandonment of Homestead

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Must be filed in order to obtain a homestead on a new property.

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Will

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An instrument disposing of property after death.

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Testator

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A person who makes a will.

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Testate

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When a person dies leaving a valid will.

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Intestate

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When a person dies not leaving a will.

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Devise

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A gift of real property by will.

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Bequest(legacy)

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A gift of money or personal property by will.

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Codicil

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A change in will before the maker's death.

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Witnessed Will

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A will usually prepared by an attorney and signed by the maker(testator) and two witnesses.

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Statutory Form Will

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A "fill in the blanks" will created to meet the requirements of Probate Code 6240.

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Holographic Will

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A will written entirely in the handwriting of the testator(maker) and is dated and signed by the testator.

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Probate

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The legal process to prove a will is valid. Held in superior court.

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Executor or Executrix

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A person named in a will to represent and handle the estate of the deceased.

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Administrator or Administratrix

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Someone appointed by the court to administer an estate when there is no will.

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Succession

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The legal transfer of a person's interest in real and personal property under the laws of descent and distribution.

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Intestate Succession

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When a person inherits property as a result of someone dying without a will.

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Accession

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A process by which there is an addition or reduction to property by the efforts of natural forces.

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Accretion

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The gradual and imperceptible ADDITION of land to a parcel by the natural deposition and accumulation of alluvium(alluvion) upon the bank of a stream or rivery.

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Alluvium

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The gradual build up of soil.

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Alluvial Deposit

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Sand or mud, carried by water and deposited on land.

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Reliction

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The process of land adjacent to a watercourse covered by water becoming uncovered because of receeding water. A slow and imperceptible recession and the recession must be permanent.

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Erosion

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The gradual wearing way of land by natural processes of water, wind, or glacial ice. The opposite of accretion.

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Avulsion

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The process by which the action of water causes a sudden, perceptible loss of OR addition to land. Original landowner has 1 year to claim land lost to avulsion.

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Adverse Possession

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The ability to obtain title by occupying land for a statutory time period without the permission of the owner. Land cannot be publically owned.

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Requirements to Acquire Ownership through Adverse Possession

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Open possession(some assertion of control, such as fencing or use)
Notorious possession(i.e., such as reasonable owner of the property would recognize)
Continuous for a five year time period
Pay property taxes on property for the five years.
Hostile(not with owner's permission)
Adverse to a claim of right(adverse possessor must claim title)
Must also file a lawsuit to QUIET TITLE against person who owned property.

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Alienated

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To transfer, convey, or sell property to another. The act of transferring ownership, title, or interest.

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Private Grant

Back 91

When a written instrument is used to transfer title.

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Real property may be transferred(alienated) in these 4 ways.

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Private grand, public grant, public dedication, or operation of law(court action).

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Instrument

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A Formal legal document, such as a contract, deed, or will.

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Grant Deed

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The most frequently used instrument in California to transfer title of real party. Parties involved are the grantor and grantee.

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A grant deed must contain

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A grant clause and two implied warranties by the grantor.

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Implied warranties of a grant deed.

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The grantor has not already conveyed title to any other person.
The estate is free from encumbrance other than those dislosed by the grantor.

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Et Ux.

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Meaning "and wife" on a grant deed.

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Ficticious Business Name(or assumed name)

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A business name other than the name of the person who has registered the business. Example:
Bill Hernandez, DBA"South Coast Peroperty Management"

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The purpose of recording a deed.

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Protecting the chain of title is the purpose of

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Chain of Title

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A sequential record of changes in ownership showing the connection from one owner to the next.