Property

Front 1

What is the rule regarding AP and FSCS and the Right of Reentry?

Back 1

* The clock will not start to run until the grantor exercises his right of entry.

Hint 1

When he sees the drinking and smoking, the AP clock doesn’t start running until he comes back and takes the property.

Front 2

What is the rule regarding AP and FSD and the Possibility of Reverter

Back 2

* In the case of a FSD, the happening of the condition starts the clock running for purposes of AP. Under the law of future interest, title went back to the Grantor (on the possibility of reverter) when the condition operated.

Hint 2

Vodka, smokes on property. X storms out after seeing it, and the clock begins to run

Front 3

What is the doctrine of constructive adverse possession?

Back 3

*An exception to AP. It expands the kernel of actual possession out to the full extent of the color of title under which the adverse possessor makes his claim of right to the property. CAP

Hint 3

This would allow X to adverse possess 85 of 100 acres. He’d get the 85 by AP and the other 15 by CAP

Front 4

What are the two limitations to constructive adverse possession?

Back 4

*[1] The amount of land that is actually possessed must bear a reasonable relation to the whole. [2] The property must be unitary, which means that the parcel of land must be one seamless whole.

Hint 4

The 100 acre land had the 85 divided by the 15 with a highway. This would prevent CAP.

Front 5

Is there a right of survivorship in a TIC?

Back 5

NO

Hint 5

So John’s estate would take John’s place after he died. 30

Front 6

Conveyancing – K of Sale & Escrow Period – What is the general rule for valid legal title on the day of closing?

Back 6

* The seller must give buyer valid legal title on the day of closing

Hint 6

MBE will give you dates and make you work through it.

Front 7

What two ways can a periodic tenancy be created by operation of law?

Back 7

[1] Oral lease that violates the SOF*; [2] Holdover Tenant

Hint 7

If an oral 5-year lease was accepted and the first month’s rent was sent and accepted. The landlord’s acceptance of rent checks results in a periodic tenancy that arises by operation of law, even though the lease itself violates SOF. The period covered by the rent check that the landlord accepted determines the period of the tenancy.

Front 8

What is the general rule for an express easement?

Back 8

[1] Must be in writing; [2] must be signed by the holder of the servient estate; [3] it must satisfy all the deed formalities. *

Hint 8

Cross-reference RP III lecture on the conveyance an interest in land, including deed formalities and recording statutes.

Front 9

Requirement #2 to enforce a restrictive covenant at law – Notice – generally & different types of notice

Back 9

Notice to the person against whom enforcement is sought. Three kinds: [1] Actual Notice; [2] Constructive Notice* [3] Inquiry Notice

Hint 9

Constructive Notice – the notice that is imparted b/c the restriction is contained in a deed that has been duly recorded in the buyer’s direct chain of title.

Front 10

What are the criteria for notice of termination of a periodic tenancy?

Back 10

*To be valid, notice must satisfy two independent criteria: [1] Enough Time – an amount of time equal to the length of the period of the tenancy except in the case of year-to-year tenancy, which generally requires only 6 months notice; [2] Effective Date – to be valid the effective date specified in the notice must be at the end of the period of the tenancy

Hint 10

By private agreement in the lease, the parties may lengthen or shorten or otherwise modify these common law notice requirements.

Front 11

What is the general rule for liability of successive landlords on the lease when a tenant sues the landlord?

Back 11

The Original landlord continues to be liable to original tenant b/c of privity of K. But successor landlords may be liable to original tenant if there is either privity o contract – or - privity of estate and the lease covenant runs w/ the land. *

Hint 11

But a successor landlord can expressly assume an obligation

Front 12

Conveyancing – K of Sale & Escrow Period – Part Performance – how do you satisfy the second requirement of having the acts of partial performance clearly proving up the existence of a contract?

Back 12

* Look for the buyer to take possession of the property – I – [1] Buyer paid full (or close to full) purchase price; OR [2] Buyer built improvements on the property; OR [3] In general, look to see that the Buyer took possession of the property and then took some further action (in partial performance of the K) that clearly proves up the existence of a K.

Hint 12

Be careful of oral contracts and cash payments. The cash payments being made on a regular basis might be consistent with some form of tenancy.

Front 13

Estate for Years (or Tenancy for Years) – Key phrase

Back 13

Specified Time. Don’t’ focus on “years” b/c it can be a few days.*

Hint 13

Arnold transfers the ranch to Sly for a period from June 1, 2004 to June 5, 2004. Tenancy for Years

Front 14

How many requirements are needed to enforce the benefit of a covenant at law when the s-i-i is the Π?

Back 14

Three – Intent, Touch & Concern, & Vertical Privity* (NO horizontal!)

Hint 14

A succeeding possessory estate would do the trick.

Front 15

What is a good way to recognize if something touches and concerns the land?

Back 15

If performance of the covenant (promise) makes the land more valuable or more useful, then the covenant touches and concerns the land. *

Hint 15

A promise to repair a fence touches and concerns where a promise to pick up the mail in town does not (b/c it’s personal to grantee).

Front 16

Should the language in a grant indicate a right of survivorship?

Back 16

Yes. It must be expressly stated.

Hint 16

“To John, Paul, Ringo, and George jointly”  Tenancy in Common

Front 17

What are the four ways in which a j/t can be severed?

Back 17

[1] Sale; [2] Mortgage; [3] Contract of Sale; [4] Creditor’s Sale of the interest in j/t

Hint 17

[1] Ringo conveys ¼ of his interest in the j/t by deed to Bob. [2] In 1971 Ringo mortgages his ¼ interest in the j/t. [3] On Jan. 1, Ringo enters into a K of sale of his interest in the j/t, w/ closing to be on 4/1. (Severance happens on Jan.1 b/c of Doctrine of Equitable Conversion) [4] Suppose Ringo had business reversals and a creditor sought to reach his interest in the j/t. (if Ringo dies before Creditor’s sale, there is no severance.)

Front 18

Concurrent Estates of Land – Incidents of Co-ownership – Accountability – general rule

Back 18

One co-tenant does not have to account to another co-tenant for his share of the profits, subject to four exceptions. (hint)

Hint 18

[1] Ouster – accounting is required if one co-tenant is either keeping a co-tenant off the property; or claiming a right of exclusive possession; [2] Agreement to share; [3] Lease of the property by a co-tenant to third party; [4] Depletion of natural resources 31

Front 19

How does a landlord’s partial eviction occur?

Back 19

[1] Where the landlord physically excludes the tenant from only some portion of the leased property.* [2] Can also occur where some third party, who holds paramount title, retakes the property and physically excludes the tenant from that portion of the leased premises.

Hint 19

[1] Landlord takes over a basement and tells tenant he can’t use. Tenant can stay on what’s left and stay for free. Few times where tenant gets the benefit in property law.

Front 20

Concurrent Estates of Land – Incidents of Co-ownership – Contribution for [1] Improvements; [2] Repairs; [3] Paying mortgage; [4] Paying taxes

Back 20

*[1] Improvements – NO; [2] Yes; [3] Yes; [4] Yes

Hint 20

[1] Although there is no current right of contribution, any monies expended for improvements (or any non-necessary repairs) may be recouped later – at time of sale of the property or on a partitioning of the property; [2] but only for necessary repairs; [3] Contribution is required for any mortgage on the property that has been signed by all the co-tenants; [4] Contribution is required towards all governmentally imposed obligations such as property taxes or assessments for curbs, streets, sewers, etc.

Front 21

In a concurrent estate of land, what are the incidents of co-ownership?

Back 21

[1] Possession; [2] Accountability; [3] Contribution. “Co-Tenant” refers to any of the multiple owners of any of the three concurrent estates)

Front 22

What are the three concurrent estates of land?

Back 22

[1] Joint Tenancy; [2] Tenancy in Common; [3] Tenancy by the Entirety

Front 23

Concurrent Estates of Land – Incidents of Co-ownership – Possession – general rule

Back 23

Each co-tenant has the right to possess the whole of the property – consistent with the same right in every other co-tenant.

Front 24

What happens if a j/t is not created properly?

Back 24

It becomes a tenancy in common.

Front 25

Under concurrent estates in land, which is the default tenancy?

Back 25

TIC

Front 26

What is the alienability of a TIC?

Back 26

Freely alienable – each co-tenant may do what they want (sell, mortgage, put in will, etc.)

Front 27

Describe the partition of a TIC

Back 27

Any tenant in common can force a partition.

Front 28

What are the unities in a Tenancy by the Entirety?

Back 28

The Four Unities + Unity of Marriage

Front 29

What is the general rule of the tenancy by the entirety?

Back 29

At CL, any grant of a concurrent estate to a husband and wife would give rise to a tenancy by the Entirety provided the four unities were present

Front 30

Tenancy by the Entirety – Right of survivorship?

Back 30

Yes

Front 31

Tenancy by the Entirety – Right of Partition?

Back 31

No

Front 32

Tenancy by the Entirety – severable by unilateral act of one of the co-tenants?

Back 32

No

Front 33

Tenancy by the Entirety – How can you terminate?

Back 33

[1] Death; [2] Mutual agreement in writing; [3] divorce; [4] Execution by a joint creditor (an individual creditor can’t reach)

Front 34

What are the unities in a tenancy in common (TIC)?

Back 34

No unities are required except for the unity of possession, which means each co-tenant is entitled to possess the whole of the property.

Front 35

What are the two strategies for property questions?

Back 35

[1] Identify & describe the three interests in land – (a) Estate, (b) Easement, (c) Restrictive Covenant; [2] How can these interests be acquired, retained, and transferred?

Front 36

What are the two present possessory estates?

Back 36

Freehold and non-freehold

Front 37

What is the key word for estates?

Back 37

Possession

Front 38

Estates w/ future rights of possession are called ______

Back 38

Future interests

Front 39

The non-freehold estates are the _____ estates

Back 39

Landlord-tenant

Front 40

What are the freehold estates?

Back 40

[1] Fee Simple (including Defeasible Fees); [2] Life Estate; [3] Fee Tail

Front 41

How long will an FSA last?

Back 41

Potentially infinite duration – potentially could last forever

Front 42

FSA must be fully _________

Back 42

Alienable

Front 43

FSA must be fully alienable: No _______ restraints on transfer of ownership of FSA

Back 43

Direct

Front 44

General Rule for FSA: Any attempt to put a direct restraint on alienation is __________ - which means you ________

Back 44

VOID; ignore the restriction

Front 45

FSA Rule – Distinguish language of “condition” from restrictions on “transferability.” Conditions _______ be imposed on the exercise of a FSA, but any attempt to limit the right to transfer is _______

Back 45

May be imposed; VOID. Ex: John wills the farm to Yoko but provided that if Yoko allows Paul onto the property, then the farm goes to Shaun. This is ok.

Front 46

Can you have a Right of First Refusal under FSA?

Back 46

Yes. Modern exception upholds validity of Rights of First Refusal.

Front 47

Courts will presume a FSA was granted – unless language shows _______ to do otherwise

Back 47

A clear intent

Front 48

What is a fee tail?

Back 48

At CL, the fee tail was a device to lock the property into the Grantee’s family.

Front 49

What was the CL language for a Fee tail?

Back 49

“To A and the heirs of his body” or “To A and his bodily heirs”

Front 50

What is the modern presumption for a fee tail?

Back 50

Fee tail language will create a FSA unless the Bar Exam questions says to apply CL rule.

Front 51

Life Estate may be granted ______ or arise _________

Back 51

Expressly; by implication

Front 52

Key Rule for Life Estate: LE is ________ by time – only measured by _________

Back 52

Never measured; life

Front 53

To Elvis for Life. Does he have a LE?

Back 53

No

Front 54

What does an implied LE look like?

Back 54

Lyndon leaves the ranch “to Lucy and Lynda after the death of my beloved wife Lady Bird.” Her LE is created by necessary implication form the terms of the testator’s will.

Front 55

What is a LE Pur Autre Vie?

Back 55

A LE measured by the life of another

Front 56

“O conveys BA to Tarzan for the life of Jane.” At CL, what happens to Tarzan’s estate if Tarzan dies but Jane (the measuring life) is still alive?

Back 56

Seisin is vacant. So anybody takes.

Front 57

“O conveys BA to Tarzan for the life of Jane.” What’s the modern rule?

Back 57

If the Life tenant dies before the measuring life dies, the LE passes to the estate of the deceased life tenant and continues in place until the measuring life dies.

Front 58

“O conveys BA to Tarzan for the life of Jane.” Modern Rule - If the Life tenant dies before the measuring life dies, the LE passes to the estate of the deceased life tenant and continues in place until the measuring life dies. Tarzan’s LE ___________. His LE was measured by _________ - NOT ______

Back 58

Terminates; measured by Jane’s life – NOT his life.

Front 59

To Tarzan, and on Tarzan’s death, to Jane. What interest does Tarzan have?

Back 59

LE

Front 60

Some years ago, Garth conveyed his mansion in Nashville “to Reba for life.” Later Reba sold her LE to her agent, Al. What happens to the mansion if AL should die before Reba dies? [1] Reba holds a LE and Reba’s (the grantee’s) life is ___________. [2] So Al holds a _______ measured by ________. [3] If Al dies before Reba, the modern rule says that the LE passes to ______ and continues until _______.

Back 60

[1] Measuring life; [2] LE measured by Reba’s life; [3] Al’s estate and continues until Reba dies.

Front 61

What’s the general rule for transferring the LE?

Back 61

If the life tenant dies before the measuring life dies, the life estate just passes to the estate of the LE and continues until the measuring life dies.

Front 62

LE and Restraints on Alienation – the Modern rule ¬¬¬_________ a provision that terminates the LE if the Life tenant attempts to convey away the LE.

Back 62

Allows

Front 63

Life estate questions usually have a second question attached that deals with ______

Back 63

Waste

Front 64

General rule of the law of waste:

Back 64

Life tenant maintains the estate. Key word is maintain which expresses BOTH the maximum and the minimum that the life tenant can do to the land.

Front 65

Law of Waste – General Rule: Life Tenant _______________ the estate.

Back 65

Maintains

Front 66

Law of Waste – General Rule: Life tenant maintains the estate. Key word is maintain which expresses both the ______ and the _______ that life tenant can do with the land.

Back 66

Maximum & minimum

Front 67

Definition of Voluntary Waste

Back 67

Voluntary waste is any affirmative action beyond the right of maintenance that causes harm to the premises.

Front 68

Voluntary Waste – Definition: Voluntary is any ______ action beyond the right of ________ that causes _________ to the premises.

Back 68

Affirmative; maintenance; harm

Front 69

Voluntary Waste - “Maintain” means life tenant may continue the _______ of the land.

Back 69

Normal use

Front 70

Any ____ is voluntary waste for which the life tenant may be liable to the holder of future interest.

Back 70

Change of use

Front 71

Any change of use is voluntary waste for which the life tenant may ________

Back 71

Be liable to the holder of future interest.

Front 72

General rule for Open Mines Doctrine under Voluntary Waste

Back 72

Depletion of natural resources constitutes waste unless consumption of such resources constitutes the normal use of the land; as in the case of a LE in a cola mine or granite quarry.

Front 73

Does the sale of harvestable crops involve waste?

Back 73

NO

Front 74

What is permissive waste?

Back 74

Failure to maintain – Tenant must do three things to avoid liability for permissive waste – Repairs, Taxes, and mortgage debt

Front 75

Permissive Waste – Repairs – General Rule

Back 75

Life tenant has obligation to make ordinary repairs but NOT replacements

Front 76

Permissive Waste – Repairs – General Rule: Life tenant has obligation to make ordinary repairs but NOT _________

Back 76

Replacements

Front 77

Three things to avoid liability for permissive waste

Back 77

Repairs, Taxes, Mortgage Debt

Front 78

If the roof leaks, does a Life Tenant have a duty to replace it?

Back 78

No. A duty to fix it but not replace it.

Front 79

Life tenant’s repair obligation is ______ to the amount of rents and profits received from the land. However, if there are NO rents and profits, then the repair obligation is limited to reasonable rental value of land if the life tenant is ________.

Back 79

Limited; using the land

Front 80

If a life tenant is receiving no income from the property and is not otherwise using the property, then life tenant has what kind of repair obligation?

Back 80

None

Front 81

Permissive Waste – Taxes - What’s the general rule?

Back 81

The tenant must pay all taxes on the property

Front 82

Permissive Waste – Taxes – what obligation is there to pay taxes?

Back 82

Same as for repairs/mortgage debt. The obligation extends only to the amount of rents and profits received from the land; or if there are no rents and profits received, then it is limited to the reasonable rental value of the land if the life tenant is using the land.

Front 83

Permissive Waste – Taxes - What happens if the life tenant fails to pay taxes on the property?

Back 83

The holder of the future interest must be sure that the taxes are paid b/c a tax sale will eliminate the future interest. The buyer at tax sale takes the property free and clear of the future interest.

Front 84

Permissive Waste – Taxes - What happens if the life tenant fails to pay taxes on the property? The holder of the future interest must be sure that the taxes are paid b/c a tax sale will _________ the future interest. The buyer at tax sale takes the property free and clear of the future interest.

Back 84

eliminate

Front 85

Permissive Waste – Mortgage Debt – General Rule

Back 85

Life Tenant must pay interest on any Mtg indebtedness on the property but is NOT required to make any principal payments. The holder of the future interest generally must pay the principal.

Front 86

Permissive Waste – Mortgage Debt – General Rule - Life Tenant must pay _________ on any Mtg indebtedness on the property but is NOT required to make any _____ payments. The holder of the future interest generally must pay the principal.

Back 86

Interest; principal

Front 87

Permissive Waste – Mortgage Debt – what obligation is there to pay interest?

Back 87

Same as for Taxes/Repairs. Interest obligation is limited to the amount of rents and profits receive; however, if there are no rents and profits, then the obligation is limited to reasonable rental value of the land if the life tenant is using the land.

Front 88

Permissive Waste – Insurance – does life tenant have a duty to insure the property?

Back 88

No

Front 89

Permissive Waste – Insurance – life tenant does not have to insure the property. However, life tenant does have __________

Back 89

An insurable interest

Front 90

What’s the general rule for ameliorative waste?

Back 90

Ameliorative waste occurs when the life tenant alters the property substantially but life tenant’s activity increases the value of the land.

Front 91

What’s the general rule for ameliorative waste? Ameliorative waste occurs when the life tenant alters the property substantially but life tenant’s activity _______ the value of the land.

Back 91

Increases

Front 92

Ameliorative Waste – general rule + four words to remember

Back 92

If changed conditions have made the property relatively worthless, then the life tenant can alter the property w/o incurring liability to the holder of the future interest. 4 words – Changed Conditions & Relatively Worthless

Front 93

All freehold estates carry with them the concept of _______

Back 93

Seisin

Front 94

The holder of Seisin is the ______

Back 94

Taxpayer

Front 95

At the moment that each and every conveyance of BA takes effect, property law wants to know who has Seisin at _______ times and under ________ possible circumstances

Back 95

All; all

Front 96

At the moment that each and every conveyance of BA takes effect, property law wants to know who has Seisin at ______ and _________

Back 96

All times and under all possible circumstances

Front 97

General rule for future interests – the interests exists now, but ____ will not take place – if it takes place at all – until _______

Back 97

Possession; some time in the future

Front 98

The future interest exists now – when it is created – but will not become _____ until some time later

Back 98

Possessory

Front 99

Multi-state future interest questions fall into to two topics: what are they?

Back 99

Classification Rules & RAP

Front 100

Two categories of future interests – Future interests retained by _____ and future interests given to ________

Back 100

Grantor; grantee

Front 101

What are the future interests retained by the grantor?

Back 101

[1] Reversion; [2] Possibility of Reverter; [3] Right of Entry

Front 102

What are the future interest given to the grantee?

Back 102

[1] Remainder; [2] Executory Interest

Front 103

Future interests in the Grantor – Reversion – General Rule:

Back 103

A Reversion in the Grantor arises whenever the Grantor conveys away less than the full durational estate that the grantor had.

Front 104

Future interests in the Grantor – Reversion – General Rule: A Reversion in the Grantor arises whenever the Grantor conveys away ________ than the ______ durational estate that the grantor had.

Back 104

Less; full

Front 105

“O conveys BA to A for life. Later A conveys BA to B for life.” What does each have?

Back 105

[A] LE. [B] LE measured by B’s life and by A’s life. [O] Reversion in Fee Simple

Front 106

“O conveys BA to A for life. Later A conveys BA to B for life.” [1] What happens to BA if B dies before A does? [2] Where will the property go when B dies? [3] What interest did A keep when A conveyed a LE to B? [4] What happens to BA if A dies before B does? [5] When A dies, where will the property go?

Back 106

[1] When B dies, B’s interest terminates. [2] Back to A. [3] A kept Reversion for Life. [4] When A dies, B’s interest terminates b/c A could convey only a LE measured by A’s life. [5] When A dies, BA goes to O by way of Reversion.

Front 107

“O conveys BA to A for life. Later A conveys BA to B for life.” What result if A is 86 years old at time A conveys BA to B for life and B is 20 years old?

Back 107

[A] Reversion for life. [B] LE measured by B’s life and A’s life. [C] Reversion in Fee Simple. Remember, the ages of parties is usually NOT RELEVANT

Front 108

“O conveys BA to A for life and A is 86 years old at the time of this conveyance. Later, A leases BA to B for 50 years.” What interests do A & B have in BA?

Back 108

[A] Reversion for Life; [B] Landlord-Tenant Estate

Front 109

“O conveys BA to A for life and A is 86 years old at the time of this conveyance. Later, A leases BA to B for 50 years. Ten years after A gives B the 50 year lease, A dies.” What result?

Back 109

[A] Nothing; [B] Nothing; [O] Reversion

Front 110

In general, property law assumes that ______

Back 110

Anything is possible

Front 111

Possibility of Reverter in the Grantor – “O conveys BA to A and his heirs for so long as no liquor is consumed on the premises.” [1] What estate does A receive?

Back 111

Fee Simple Determinable

Front 112

When does the FSD estate terminate?

Back 112

FSD will DETERMINE (or end) AUTOMATICALLY on the occurrence of some event.

Front 113

What’s the general rule for a FSD?

Back 113

Whenever the grantor conveys a FSD, the Grantor automatically retains a possibility of a reverter

Front 114

A possibility of a reverter only goes with _____

Back 114

A FSD

Front 115

What magic words help identify a FSD?

Back 115

[1] So long as; [2] While; [3] during; [4] until

Front 116

Right of Re-Entry in the Grantor (or power of termination) – “O conveys BA to A and her heirs; provided, however, that if liquor is ever consumed on the premises then O or O’s heirs shall have the right to re-enter and retake the premises” What interests?

Back 116

[A] Fee simple on condition subsequent; [O] Right of Entry

Front 117

When does the Fee Simple on Condition Subsequent (FSCS) terminate?

Back 117

[1] Title does NOT go back to the Grantor automatically when the condition is broken. [2] Instead O must do something to retake property. [3] Title stays in the Grantee A until the Grantor O exercises his Right of Entry.

Front 118

Whenever Grantor conveys a FSCS, grantor keeps ______

Back 118

Right of Entry

Front 119

Magic words to identify FSCS:

Back 119

[1] Provided, however; [2] But if; [3] On condition that

Front 120

To create a FSCS, the magic words must be followed by language where the Grantor expressly _____ the right to re-enter and retake the property.

Back 120

Reserves

Front 121

For a FSCS, words dealing w/ hope have _______ on title.

Back 121

No effect. “for the purpose of.”

Front 122

O conveys BA to WFU for the purpose of building a gym. If WFU later builds a theater on BA, will WFU lose title to BA?

Back 122

No. Words dealing w/ hope have no effect on title. “for the purpose of”

Front 123

Transferability of Future interests in the grantor – Remember, all future interests in grantor are ______

Back 123

Vested

Front 124

Transferability of Future interests in the grantor – Reversions – [1] Subject to RAP? [2] Freely Transferable on death? [3] Freely transferable inter vivos?

Back 124

[1] NO; [2] YES; [3] YES

Front 125

Transferability of Future interests in the grantor – Possibility of Reverter – [1] Subject to RAP? [2] Freely Transferable on death? [3] Freely transferable inter vivos?

Back 125

[1] NO; [2] YES; [3] YES

Front 126

Transferability of Future interests in the grantor – Right of Entry – [1] Subject to RAP? [2] Freely Transferable on death? [3] Freely transferable inter vivos?

Back 126

[1] NO – vested; [2] YES; [3] NO

Front 127

How do you spot a remainder?

Back 127

A remainder is a future interest in a third party grantee that comes naturally and immediately on the termination of the preceding estate.

Front 128

A remainder is a future interest in a third party grantee that comes _______ and _________ on the ________ of the preceding estate.

Back 128

Naturally; immediately; termination

Front 129

Remainders are either ______ or __________

Back 129

Vested or contingent.

Front 130

General Rule: A remainder is _______ if nothing stands in the way of its becoming possessory on the natural expiration of the preceding estate. (i.e., taker is ascertainable and no conditions to taking)

Back 130

Vested

Front 131

What does it mean to take on the natural expiration of the preceding estate?

Back 131

Taker is ascertainable and there are no conditions to taking.

Front 132

“O conveys BA to A for life; and then on A’s death to B and heirs.” Who takes?

Back 132

[A] LE; [B] Remainder in FS; [O] Nothing. At the moment the conveyance in made, B takes a vested remainder in the FS. Even if B is dead when A dies, the property will go to B’s estate. The property will never go back to O.

Front 133

Which one is contingent and which one is vested? “O conveys BA to A for life; and then on A’s death to B and heirs.” And “O conveys BA to A for life, then to B and his heirs if B survives A.”

Back 133

“O conveys BA to A for life; and then on A’s death to B and heirs” is vested. “O conveys BA to A for life, then to B and his heirs if B survives A” is contingent.

Front 134

“O conveys BA to A for life, then to B and his heirs if B survives A.” What is this? Who gets what?

Back 134

Vested Remainder in Grantee. [A] LE; [B] Contingent Remainder in FS; [O] Reversion.

Front 135

“O conveys BA to A for life, then to B and his heirs if B survives A.” Why does B take a contingent remainder?

Back 135

Because there is a contingency (i.e., a survivorship clause) that B must satisfy before his interest in BA will become possessory.

Front 136

“O conveys BA to A for life, then to B and his heirs if B survives A.” What happens to the property if B dies before A?

Back 136

The law assumes that the contingency plan is for the property to go back to O by way of reversion.

Front 137

“O conveys BA to A for life, then to B and his heirs when B reaches 21.” At the time of conveyance, B is 15 years old. What is this? Who takes?

Back 137

Contingent remainder in grantee. [A] LE; [B] Contingent Remainder in FS; [O] Reversion

Front 138

“O conveys BA to A for life, then to B and his heirs when B reaches 21.” What happens when B’s interest when he celebrates his 21st birthday and A is till alive?

Back 138

B’s interest is now a vested remainder b/c B satisfied the age contingency.

Front 139

“O conveys BA to A for life, then to B and his heirs when B reaches 21.” At the time of A’s death, B is 18 years old. What happens to BA when A dies?

Back 139

Under modern majority rule, BA goes back to O by way of reversion, who will hold the property in FS subject to an executory interest and B holds the executory interest.

Front 140

“O conveys BA to A for life, then to A’s children.” At the time O makes this grant, A has three children, B, C, D.

Back 140

Class Gift – Vested Remainder subject to open. [A] LE; [B, C, D] Vested remainder subject to open.

Front 141

What is another name for a vested remainder subject to open?

Back 141

A vested remainder subject to partial divestment.

Front 142

What’s the general Rule for class gifts – vested remainder subject to open?

Back 142

Where the remainder interest is conveyed to a class of unnamed persons whose members are not yet fully known, the class remains open to allow for future persons who qualify as class members by satisfying the class description (i.e., children of A)

Front 143

Testator’s will devises BA “to A’s children.” At the time the will is executed, A has 2 children – B &C. After the will is executed and before testator dies, A has another child, D, and one of the other children, B, dies. Then the testator dies. Finally, two years after testator’s death, A has another child, E. The gift “to A’s children” is a ________

Back 143

Class gift.

Front 144

Under a rule of convenience, the class closes for a class gift whenever __________. The rule of convenience is a rule of _________, not a rule of ___________.

Back 144

Under a rule of convenience, the class closes for a class gift whenever any class member is entitled to a distribution. The rule of convenience is a rule of construction, not a rule of law.

Front 145

Members of a class who predecease the testator are ______. Their gift ______ (unless the _______ applies)

Back 145

Eliminated; lapses; anti-lapse statute

Front 146

Once the class gift is established, when the will is executed, the class remains ______ in order to _________.

Back 146

Remains open in order to accommodate those who come later and satisfy the class definition.

Front 147

Under a class gift, later born children ______ unless _______

Back 147

Lose out unless they were gestation at time of T’s death.

Front 148

If the Grantee is not in existence (i.e., is not _________) at the time the conveyance takes effect, then the remainder is _________ on the grantee being born and therefore _______.

Back 148

Ascertainable; contingent; ascertainable.

Front 149

“O conveys BA to Harry for life, then to Harry’s widow.” At the time of this conveyance is made, Harry is married to Sally. The widow’s interest is _______ b/c the exact identity of the take is not ascertainable until Harry dies, at which time we can identify the person who _______.

Back 149

Contingent; who turns out to be Harry’s widow.

Front 150

“O conveys BA to Harry for life, then to Harry’s widow.” At the time of this conveyance is made, Harry is married to Sally. What does Sally get? What does O get?

Back 150

Sally gets nothing. O keeps a reversion b/c the property will go back to O if Harry should be unmarried at the time of his death, leaving behind no widow.

Front 151

Remainders (whether vested or contingent) will become possessory, if at all, only upon ______.

Back 151

The natural expiration of the estate that comes before them.

Front 152

Remainders (whether vested or contingent) will become possessory, if at all, only upon the natural expiration of the estate that comes before them. So remainders NEVER/ALWAYS affect the estate that comes before them.

Back 152

Never

Front 153

How do you identify an executory interest?

Back 153

It operates to cut short the estate that comes before it.

Front 154

Do remainders follow a fee simple?

Back 154

NEVER.

Front 155

If a future interest in a grantee is not a remainder, then it must be a ________

Back 155

Executory interest

Front 156

“O conveys BA to A for life, then to B and his heirs; but if at B’s death B is not survived by issue, then to C and her heirs.” Who takes?

Back 156

[A] LE; [B] Vested remainder in fee simple subject to executory interest; [C] executory interest

Front 157

A vested remainder subject to an executory interest is sometimes called a ________ or _________

Back 157

Vested remainder subject to total divestment; Vested remainder subject to an executory limitation.

Front 158

Rule and strategy for labeling executory interests.

Back 158

Always label the interests in the order the grants are made. Pay careful attention to punctuation – look to see if a contingency is made part of the first estate given to a grantee or if it has been made part of the gift over following the earlier estate.

Front 159

Helpful words for executory interests.

Back 159

Look for “but if, then to”

Front 160

“O conveys BA to Ross for life, then to Phoebe; but if coffee is ever consumed on the property, then the property should go to Rachel.” Who has what?

Back 160

[Ross] LE; [Phoebe] Vested remainder in fee simple subject to total divestment – or – vested remainder in fee simple subject to executory interest; [Rachel] – Executory interest

Front 161

“O conveys BA to Ross for life, then to Phoebe; but if coffee is ever consumed on the property, then the property should go back to Rachel.” If Ross cuts down all the shade trees on BA, can Rachel sue for waste?

Back 161

NO, b/c holders of executory interest do not have standing to sue for waste.

Front 162

“O conveys BA to Ross for life, then to Phoebe; but if coffee is ever consumed on the property, then the property should go back to Rachel.” If Ross cuts down all the shade trees on BA, can Phoebe sue for waste?

Back 162

Yes, b/c Phoebe – the holder of the remainder – has standing to sue for waste.

Front 163

Do holders of executory interests have standing to sue for waste?

Back 163

No

Front 164

The types of defeasible fees are:

Back 164

[1] Fee Simple Determinable; [2] Fee Simple subject to condition subsequent; [3] fee simple subject to executory interest

Front 165

What’s the traditional statement of RAP?

Back 165

No interest is good unless it must vest, if at all, not later than 21 years after the death of some life in being at the creation of the interest.

Front 166

What’s the modified version of RAP?

Back 166

No interest will be valid unless it must vest – if it is going to vest all– w/in 21 years after the death of some life in being who was alive at the moment the conveyance was made.

Front 167

What public policy is promoted by RAP?

Back 167

To promote free transferability of land by preventing Remote Vesting.

Front 168

RAP always applies to ______ and ________ and ________

Back 168

Executory interests; contingent remainders vested remainders subject to open

Front 169

“O conveys BA to A and his heirs so long as no liquor is consumed on the premises; and if liquor is ever consumed on the premises, title shall go to B and her heirs.” What are the intended grants?

Back 169

[A] Fee simple subject to executory interest; [B] Executory interest in FS; [O] Nothing b/c O intended to convey away his entire interest in BA.

Front 170

“O conveys BA to A and his heirs so long as no liquor is consumed on the premises; and if liquor is ever consumed on the premises, title shall go to B and her heirs.” What happens to B’s future interest under RAP?

Back 170

It is voided b/c it violates the rule. This executory interest is void b/c it is entirely possible that many generations will pass before liquor is consumed on the property – which may occur at a time that is outside lives in being plus 21 years.

Front 171

What key question should you always ask under RAP?

Back 171

Could this future interest possibly vest in the grantee outside the time period of the Rule (i.e., is it possible that everyone alive at the time of the grant dies – plus more than 21 years go by – before that interest might vest?) If the answer is yes, then the interest is void.

Front 172

What happens if a future interest is rendered void under RAP?

Back 172

Cross out language of the conveyance that violates the rule. Often, it will be everything after the semi-colon.

Front 173

“O conveys BA to A and his heirs so long as no liquor is consumed on the premises; and if liquor is ever consumed on the premises, title shall go to B and her heirs.” What is left after application of RAP?

Back 173

[A] FSD; [B] nothing; [O] Possibility of Reverter. O’s possibility of reverter is vested and therefore not subject to RAP. Whenever liquor is consumed on the property, BA will revert back to O.

Front 174

“O conveys BA to A and his heirs so long as no liquor is consumed on the premises; and if liquor is ever consumed on the premises, title shall go to B and her heirs.” Assume that 5 years after the conveyance of BA to A, liquor is consumed on the premises. Is B’s interest valid under RAP? Who takes what?

Back 174

NO. [A] FSD; [B] Nothing; [O] Possibility of Reverter

Front 175

What is the rule about determining when RAP applies?

Back 175

Validity of an interest under RAP is determine at the time the conveyance is made – at the time the interest is created. We do NOT wait and see what actually happens.

Front 176

When do you look at RAP in situations w/ a will?

Back 176

IF transfer is made by will – apply the RAP as of time of Testator’s death – when the will takes effect.

Front 177

If a transfer is made by deed – apply the terms of the RAP as of ______

Back 177

The time the deed takes effect.

Front 178

What is the Uniform Statutory RAP

Back 178

Codified RAP and in addition provides for an alternative 90 year vesting period. Thus, it adopts a wait and see approach to determine whether vesting actually occurs w/in 90 years. The exam will tell us if we need to use this.

Front 179

What is a RAP savings clause example and why use it?

Back 179

“…during the lifetime of A or B or within 21 years after the death of the survivor of A or B…” This language is included in order to save a grant from violating RAP by making sure that vesting must occur w/in the time period. No possibility of remote vesting. But this will still leave a possibility of reverter in the grantor b/c once B/s executory interest is extinguished by its own terms, all that’s left is a FSD in A and O automatically keeps a Possibility of reverter.

Front 180

“O conveys BA to A and her heirs; provided, however, that if the premises shall ever cease to be used for residential purposes, then B has the right to re-enter and retake the premises.” Who takes? Why is this tricky?

Back 180

[A] Fee simple subject to executory interest; [B] Executory interest; [O] nothing. Tricky – The language used in the conveyance looks like it is trying to create a right of entry in the grantee, B. But a Right of Entry can be created in favor of the grantor only. So B, as the grantee, has to take either a remainder or an executory interest. Don’t be fooled by the use of extraneous words in the language of the grant.

Front 181

“O conveys BA to A and her heirs; provided, however, that if the premises shall ever cease to be used for residential purposes, then B has the right to re-enter and retake the premises.” Does this violate RAP?

Back 181

Yes. It is entirely possible that the property may be used for non-residential purposes outside the time period of the Rule.

Front 182

“O conveys BA to A and her heirs; provided, however, that if the premises shall ever cease to be used for residential purposes, then B has the right to re-enter and retake the premises.” What interests are left after application of RAP?

Back 182

[A] FSA; [B] nothing b/c B’s executory interest is void under RAP and therefore we strike it out; [O] nothing

Front 183

Right of First Refusal and RAP – general rule

Back 183

Contingent interests in property, such as options and rights of first refusal, violate RAP if they could possibly be exercised outside the time period of the rule.

Front 184

Bilbo conveys BA to Frodo and his heirs; but if Frodo and his heirs ever try to sell the property, Gandalf and his heirs have a right of first refusal. RAP apply? Violate?

Back 184

The grant of the right of first refusal violates RAP. It is entirely possible that the condition could be violated – thereby triggering Gandalf’s right of first refusal – way outside the frame of RAP. Exercise of this right of first refusal does not have to occur w/in the lives of the named parties. Instead, exercise could occur any time in the future. So Gandalf gets nothing and Frodo gets FSA.

Front 185

For the charity to charity exception to RAP to apply, both transferees _______

Back 185

Must be a charity.

Front 186

Class gifts and RAP – general rule

Back 186

Age contingency beyond 21 in an open class and RAP (arises where class is open and the gift over is contingent on class member reaching a certain age.)

Front 187

Testator dies w/ a will devising BA to A for life, then to such of A’s children as reach age 30. A has no children at the time of Testator’s death. What are the intended grants?

Back 187

[A] LE; [A’s children] – this is a remainder that is contingent in two respects – (i) the taker(s) still must be ascertained; and (ii) the taker(s) must reach age 30. [O] Reversion – just in case no child of A is born and reaches age 30 before A dies. But remember, RAP applies here.

Front 188

Testator dies w/ a will devising BA to A for life, then to such of A’s children as reach age 30. A has no children at the time of Testator’s death. Does RAP apply to void the gift over to the class of A’s children who reach 30?

Back 188

Yes. Ask yourself – could this remainder possibly vest later than lives in being plus 21 years? Yes, since A could have a child after Testator dies, and that child’s interest would not vest until that child reaches age 30.

Front 189

Testator dies w/ a will devising BA to A for life, then to such of A’s children as reach age 30. A has no children at the time of Testator’s death. What if the language of the conveyance was “to such of A’s children as reach 21?”

Back 189

Then the gift would be valid, b/c it is clear – at the moment the conveyance is made – that a child will be born to A and will reach age 21, if at all, w/in 21 years (plus any period of gestation) of some life in being – that is, within 21 years of someone who was alive at the moment the conveyance is made. Here, we use A (the biological parent) as the measuring life.

Front 190

Class gift – whenever the language used in the grant puts the age contingency beyond 21, the conveyance _______

Back 190

Loses its link to a life in being.

Front 191

“O conveys BA to Mary for life, then to such of Mary’s children as reach the age of 30.” Mary is now 87, and she has three children, all in their 60’s. What are the attempted grants? Does RAP apply to void the gift over to those of Mary’s children who reach age 30?

Back 191

[Mary] LE; [Mary’s children] Vested remainder subject to open – to allow for the birth of future siblings who reach age 30. RAP applies b/c of the Fertile Octogenarian rule – which conclusively presumes that Mary might have another child, regardless of her age or medical condition. So it ends up that [Mary] LE; [Mary’s children] Nothing; [O] Reversion

Front 192

What types of conditions are included in Fertile Octogenarian Rule?

Back 192

Coma, hysterectomy, etc. It doesn’t really matter. She’ll be considered fertile.

Front 193

“O conveys BA to Mary for life, then to such of Mary’s children as reach the age of 30.” Mary is now 87, and she has three children, all in their 60’s. What do Mary’s children get?

Back 193

They take nothing b/c this class gift violates RAP.

Front 194

General rule for class gifts + RAP

Back 194

If RAP operates to void the gift over to any member of the class b/c their interest might vest outside the time frame of the rule, then all class members lose. The entire class gift is void, even if there are persons who satisfy the class definition and therefore appear vested in their interests.

Front 195

What is the old maxim for a class gift?

Back 195

Bad as to one – bad as to ALL! Look carefully at the facts to be sure that there is no possibility that a class member’s gift might vest outside the time period of the Rule.

Front 196

General rule regarding creation of joint tenancies

Back 196

The four unities must be present at the outset in order to create a joint tenancy.

Front 197

What are the four unities and what are they test for?

Back 197

Joint tenancy – Unity of TIME; Unity of TITLE; Unity of INTEREST; Unity of POSSESSION

Front 198

Describe the Four Unities test

Back 198

TTIP – [T] Unity of TIME – all joint tenancy interests must have vested at the same time; [T] Unity of TITLE – The grant to all joint tenants must be by the same instrument; [I] Unity of Interest – All joint tenants must take the same kind and same amount of interest; [P] Unity of Possession – all joint tenants must have same/identical rights of possession.

Front 199

General Rule – to create a joint tenancy, the language of conveyance must clearly reflect _______

Back 199

The grantor’s intent to create a j/t

Front 200

In concurrent estates in land, what is the modern presumption in favor of?

Back 200

Tenancy in Common. So if the intent of the grantor is unclear, the modern rule presumes in favor of a Tenancy in Common.

Front 201

What are the magic words that must be used to create a joint tenancy?

Back 201

“as joint tenants, with right of survivorship”; or “in joint tenancy with right of survivorship”

Front 202

What’s the general rule for a j/t and a ROS?

Back 202

J/t carries a ROS (right of survivorship). The surviving joint tenants take automatically on death of a joint tenant.

Front 203

What’s the general rule for a Right of Partition under a J/T?

Back 203

If any joint tenant wants to be relieved of common ownership, he or she can do so by asking that the property be partitioned.

Front 204

What happens when you partition a property under a j/t?

Back 204

In partitioning the property, lines are drawn and the party seeking a partitioning is no longer a joint tenant and will own his portion outright.

Front 205

How does a partition occur under a j/t?

Back 205

Partition can occur by voluntary agreement between the parties. If the parties cannot reach an agreement, then a judicial action seeking a partition may be brought.

Front 206

How can a j/t be severed?

Back 206

Severance occurs whenever any one of the unities is disturbed.

Front 207

What is an ineffective way to sever a j/t?

Back 207

By will. It must be severed during lifetime.

Front 208

What is the majority rule for mortgaging an interest in a j/t? The minority rule?

Back 208

[Majority Rule] In a lien theory state, there is NO severance of the j/t. When the mortgage is executed, a lien attaches to the title, but title is not transferred. So the unities are NOT disturbed. [Minority Rule] In a title theory state there is a severance of the j/t. When the mortgage is executed, title passes from mortgagor to mortgagee, even though title goes back to the mortgagor when the mortgage is satisfied. Unities are disturbed.

Front 209

What’s the general rule for a creditor’s sale of the interest in a j/t?

Back 209

There is NO severance until the judicial sale actually takes place. Title passes to surviving joint tenants and judgment creditor has no recourse against the property

Front 210

Concurrent Estates of Land – Incidents of Co-ownership – Accountability – 4 exceptions to general rule

Back 210

[1] Ouster – accounting is required if one co-tenant is either keeping a co-tenant off the property; or claiming a right of exclusive possession; [2] Agreement to share; [3] Lease of the property by a co-tenant to third party; [4] Depletion of natural resources

Front 211

Concurrent Estates of Land – Incidents of Co-ownership – What is Contribution?

Back 211

Contribution concerns the right of one co-tenant to force the other co-tenants to pay their fair share of some expenditure made on the property. The right to contribution depends on what type of expenditure was made on the property.

Front 212

Non-Freehold estates – what are the four Landlord-Tenant Estates?

Back 212

[1] Estate for Years (or Tenancy for Years); [2] Periodic Tenancy; [3] Tenancy at Will; [4] Tenancy at Sufferance

Front 213

Estate for Years (or Tenancy for Years) – What must it specify?

Back 213

Must specify two dates – Definite beginning date & Definite ending date

Front 214

Any estate measured by a fixed period of time – no matter how short – is a _____

Back 214

Tenancy for years

Front 215

Estate for Years (or Tenancy for Years) – Statute of Frauds – what’s the rule?

Back 215

Any Tenancy for Years for over 1 year must be in writing. A one year tenancy may be oral

Front 216

Does a one year tenancy have to be in writing?

Back 216

No. can be oral

Front 217

Estate for Years (or Tenancy for Years) – When is notice required?

Back 217

No notice is required between landlord and tenant to terminate the tenancy for years.

Front 218

Periodic Tenancy – key phrase -

Back 218

Repeating

Front 219

Periodic Tenancy – Repeating is the key phrase. Why?

Back 219

This estate rolls on and on until one party gives proper notice

Front 220

Periodic Tenancy – Creation – Three ways

Back 220

[1] By express agreement; [2] by implication (no agreement as to duration); [3] By operation of law – two ways – (a) Oral lease that violates SOF, (b) Holdover Tenant

Front 221

What is the general rule for creating a periodic tenancy by implication?

Back 221

If the lease does not specify how long the tenancy is to last, then it is presumed to be a periodic tenancy measured by the rent payment (e.g., a month-to-month periodic tenancy arises if the rent is to be paid monthly)

Front 222

What is a holdover tenant?

Back 222

A tenant who was on the property under a valid lease but the lease has expired – and the tenant nonetheless remains on the property

Front 223

What is the general rule when a landlord accepts a rent check from a holdover tenant?

Back 223

When the landlord accepts a rent check from a holdover tenant, a periodic tenancy is created by operation of law for the period specified in the rent check.*

Front 224

How does a periodic tenancy terminate?

Back 224

By giving proper notice

Front 225

Define a Tenancy at Will

Back 225

Either party can terminate this tenancy at any time, without notice

Front 226

What is the notice requirement for a Tenancy at Will?

Back 226

No notice is required to terminate this very fragile tenancy

Front 227

Termination of a Tenancy at Will by Operation of Law – 5 ways

Back 227

[1] Death of either party; [2] Waste by Tenant; [3] Assignment by Tenant; [4] Transfer of Title by Landlord; [5] Lease by Landlord to third party

Front 228

When does a Tenancy at Sufferance (The Holdover Tenant) occur?

Back 228

In only one situation – this type of tenancy refers to the bare possession that a tenant has of the property when that tenant wrongfully holds over.

Front 229

What are the landlord’s options in a Tenancy at Sufferance (The Holdover Tenant)?

Back 229

[1] Sue to Evict; [2] Impose a New Periodic Tenancy

Front 230

How does a landlord sue to evict in a Tenancy at Sufferance (The Holdover Tenant)?

Back 230

Sue in trespass and recover damages

Front 231

How can a landlord impose new periodic tenancy in a Tenancy at Sufferance (The Holdover Tenant)?

Back 231

[1] The landlord may elect to treat the tenant as a new periodic tenant; [2] if the old expired tenancy was for less than a year, the new tenancy will be measured by the period covered by the rent payment. In the case of residential property, the new period will usually be month-to-month. [3] In the case of leases for commercial property, if the old, expired tenancy was for a year or more, the new periodic tenancy that the landlord may elect to impose will be for year-to-year. [4] The landlord may not impose a new periodic tenancy is it is not reasonable under the circumstances, e.g., tenant’s moving van is late by a few hours, etc.

Front 232

What is the general rule for a raised rent situation in a Tenancy at Sufferance (The Holdover Tenant)?

Back 232

If the landlord gives the tenant notice of the increase in rent before the expiration of the lease, then the landlord may properly demand payment of the higher rent amount if the tenant holds over.

Front 233

What are the duties of a tenant?

Back 233

[1] Duty to Pay rent; [2] Duty to maintain premises;

Front 234

What duty is there for the tenant to maintain the premises when the lease is silent?

Back 234

Tenant is still subject to CL duty not to commit waste.

Front 235

What is the majority’s view of tenant’s responsibility regarding waste?

Back 235

Under modern majority view, if the leased premises are destroyed w/o the tenant’s fault, the tenant generally will be given the option to terminate the lease.

Front 236

If a lease includes a tenant’s covenant to repair, what duty does the tenant have to maintain the premises?

Back 236

A covenant to repair & maintain makes the tenant the absolute insurer of the property – w/ the CL exception that the tenant was not responsible for ordinary wear and tear.

Front 237

What’s the modern view of a tenant’s duty to maintain the premises when the lease includes a tenant’s covenant to repair?

Back 237

The tenant is liable for everything, including ordinary wear & tear – unless the parties agreement expressly excludes this responsibility from the tenant’s repair covenant.

Front 238

Under the modern view of a tenant’s duty to maintain the premises when the lease includes a tenant’s covenant to repair, what happens when the leased premises are destroyed?

Back 238

If it’s destroyed w/o the tenant’s fault, the tenant generally will not be required to rebuild the structure – even if the lease includes the tenant’s covenant to repair – unless the lease expressly includes this type of repair.

Front 239

Common Law view of a landlord’s remedies when a tenant fails to pay rent

Back 239

Landlord could sue for damages, but was only allowed to collect the amount in arrears. He could NOT terminate the lease.

Front 240

Modern view of a landlord’s remedies when a tenant fails to pay rent

Back 240

All states allow the landlord to sue for damages AND terminate the lease, thus evicting the tenant.

Front 241

What are the two options a landlord has when the tenant unjustifiably abandons?

Back 241

[1] Landlord accepts the tenant’s offer of abandonment; [2] landlord relets the premises, holding the tenant liable for any deficiency.

Front 242

When a tenant unjustifiably abandons and the landlord accepts the tenant’s offer of abandonment, what happens? What are the tenant’s obligations?

Back 242

The landlord may elect to treat the abandonment as the tenant’s offer of surrender of the leasehold, which the landlord accepts by retaking the premises and thereby terminating the lease. The tenant has no further obligations.

Front 243

When a tenant unjustifiably abandons and the landlord relets the premises holding the tenant liable for any deficiency, what is the landlord essentially doing?

Back 243

He is mitigating the tenant’s damages, and holding the tenant liable for any deficiencies.

Front 244

When a tenant unjustifiably abandons and the landlord relets the premises holding the tenant liable for any deficiency, what happens at common law?

Back 244

At common law, the landlord was under NO such duty to mitigate tenant’s damages. The landlord could leave the property vacant for the remainder of the lease and hold the tenant liable for the rent amount.

Front 245

When a tenant unjustifiably abandons and the landlord relets the premises holding the tenant liable for any deficiency, what happens under the modern majority rule?

Back 245

The landlord must make a reasonable effort to mitigate the tenant’s damages.

Front 246

What are the duties of a landlord?

Back 246

[1] Duty to deliver possession of the leased premises; [2] Duty regarding Condition of the leased premises; [3] Implied covenant of Quiet enjoyment

Front 247

What is a landlord’s duty to deliver possession of the leased premises?

Back 247

The landlord must deliver possession of the leased premises to the tenant when the lease begins. If the landlord cannot deliver actual possession, the landlord is in breach of the lease.

Front 248

What is a landlord’s duty regarding the condition of leased premises at CL?

Back 248

The landlord has not duty to deliver the leased premises in a habitable condition – lease involves transfer of an estate

Front 249

What is a landlord’s duty regarding the condition of leased premises under the modern majority?

Back 249

There is an implied warranty of fitness or habitability only for residential property. It provides that the leased premises are reasonably suited for residential use. There is no duty for non-residential use.

Front 250

What are the tenant’s remedies for the landlord’s breach of the implied warranty of habitability?

Back 250

[1] tenant can move out and end the lease; [2] tenant can stay on the property and sue for damages; [3] a growing # of states allow the tenant to make reasonable repairs and deduct this cost from future rent payments (“repair & deduct”) tenant must give notice.

Front 251

As a duty of a landlord, what is the general rule for implied covenant of quiet enjoyment?

Back 251

Every lease includes the landlord’s implied promise not to interfere w/ the tenant’s quiet enjoyment of the leased premises. This implied promise is included in every lease – residential, commercial or otherwise.

Front 252

How does a landlord breach the implied covenant of quiet enjoyment?

Back 252

[1] Total eviction; [2] Partial eviction; [3] Constructive Eviction

Front 253

What’s the general rule for a partial eviction?

Back 253

If there is a partial eviction by someone other than the landlord, the rent is proportionately reduced to reflect the amount taken. Otherwise, it’s free.

Front 254

What is a constructive eviction? When does it occur?

Back 254

This type of breach does not involve an actual physical exclusion of the tenant from all or some part of the leased premises. It occurs where the landlord fails to provide some service that the landlord is obligated to provide and that failure makes the property uninhabitable.

Front 255

What are the three requirements for a constructive eviction?

Back 255

[1] It must be the landlord’s failure to provide some service, not some third party’s failure; [2] There must be a substantial interference with the tenant’s quiet enjoyment of property. [3] Tenant must abandon within a reasonable time.

Front 256

What is an assignment?

Back 256

When you transfer All

Front 257

What is a sublease?

Back 257

When you transfer only a part

Front 258

What is the key to knowing how to answer questions regarding assignments?

Back 258

A lease involves both of the following: [1] A lease is a contract, creating privity of contract between the parties to the lease agreement. [2] A lease is also a conveyance of an estate, of an interest in land, thereby creating privity of estate between the parties. These are separate and independent grounds for liability on lease obligations.

Front 259

Assignment – general rule of liability

Back 259

A tenant is liable to the landlord for rent if there is either privity of estate or privity of contract

Front 260

Assignment – who has privity of estate?

Back 260

Only between present landlord and present tenant

Front 261

Assignment – who has privity of contract?

Back 261

Exists only where there is an agreement between the landlord and the particular tenant from whom the landlord seeks to recover the rent.

Front 262

What is the Assignee’s liability on other lease covenants?

Back 262

Covenant (promise) to pay rent always runs w/ the land and therefore is enforceable based on either privity of estate or privity of contract. As to other covenants (promises) contained in the lease, the general rule is that a covenant will run w/ the land if it touches and concerns the land

Front 263

Under a sublease, what is the subtenant’s liability for rent?

Back 263

The landlord can recover rent from anyone with whom he is in privity (either privity of estate or privity of K). In the case of a sublease, the sublessor keeps the estate; the estate is not transferred to the sublessee.

Front 264

In the case of a sublease, who keeps the estate?

Back 264

The sublessor. T he estate is not transferred to the sublessee.

Front 265

What is a non-assignment clause? What’s another name for it?

Back 265

A/k/a non-sublease. A clause in the lease that says the tenant may not assign or sublet without the express permission of the landlord.

Front 266

Describe the validity of a non-assignment clause.

Back 266

Even though it’s a restraint on alienation, all courts say it’s valid and fully enforceable. But courts will strictly construe such clauses, so a non-assignment clause generally does not prohibit a sub-lease and vice versa. Violation of a non-assignment or non-sublease clause merely makes the attempted transfer voidable at the option of the landlord.

Front 267

What’s the general rule regarding waiver of non-assignment and non-sublease clauses?

Back 267

Permission given once means that a non-assignment/non-sublease clause is waived altogether – unless the landlord states otherwise at the time of giving permission, i.e., at the time he consents to the transfer

Front 268

What if there was no assignment but a landlord accepts a check from an assignee?

Back 268

The landlord’s acceptance of rent payment from an assignee approves the assignment. Also, the landlord’s acceptance of rent payment waives the no assignment clause permanently. Courts are quick to find waiver!!

Front 269

What two issues arise when the state takes property that is under a lease pursuant to the exercise of the state’s power of eminent domain?

Back 269

[1] Is the tenant’s rent obligation excused? [2] Will the tenant share in the condemnation award?

Front 270

How do you approach issues arising under eminent domain and leases?

Back 270

Ask: [1] is the tenant’s rent obligation excused? [2] Will the tenant share in the condemnation award? To answer these issues, you must FIRST decide whether all or only a portion of the leasehold property has been taken by the state. The rules are different in a partial condemnation and in a complete taking.

Front 271

What is the general rule for a partial condemnation in an eminent domain issue in lease situations?

Back 271

A partial taking by eminent domain does not release the tenant from the obligation to pay full rent. In the case of a partial taking, the tenant will get an amount equal to the rent that was to be paid over the remainder of the lease term for that portion of the property that was condemned.

Front 272

What happens with a complete taking of leasehold property?

Back 272

A complete taking extinguishes the lease and the tenant is thereby excused from paying any further rent. In the case of a complete taking, the tenant will share in the condemnation award only to the extent that the fair rental value of the property exceeds the amount of rent due under the lease.

Front 273

What is the general common law rule for tort liability of landlord and tenant?

Back 273

NO duty imposed on the landlord. There is no duty to tenant or tenant’s invitee for injuries sustained on the premises during the period of the lease. There are five defects.

Front 274

What are the five defects to the CL rule that no duty is imposed on the landlord in tort situations?

Back 274

[1] Latent defects; [2] Short term lease of a furnished dwelling (summer cottage in Maine rule); [3] Common passageways under Landlord’s control; [4] Negligent repairs undertaken by landlord; [5] Public use exceptions

Front 275

What is a latent defect?

Back 275

A defect that the tenant does not now of and a reasonable person in the tenant’s position would not discover.

Front 276

What is the scope of the landlord’s duty concerning a latent defect?

Back 276

The landlord must disclose the defect but is under not duty to repair

Front 277

Exception to no duty imposed on the landlord for tort liability – Latent Defects – general rule

Back 277

Landlord is under a duty to disclose latent defects which the landlord either knows or has reason to know of

Front 278

Exception to no duty imposed on the landlord for tort liability – Short term lease of a furnished dwelling – general rule

Back 278

Summer cottage in Maine rule. The rental of a furnished dwelling for a short term makes the landlord liable for defects, even if the landlord neither knows nor has reason to know of such defects.

Front 279

Exception to no duty imposed on the landlord for tort liability – Short term lease of a furnished dwelling – what is “short term”?

Back 279

3 months

Front 280

Exception to no duty imposed on the landlord for tort liability – Common Passageways under Landlord’s control – general rule

Back 280

Landlord will be liable if the landlord failed to exercise reasonable care.

Front 281

Exception to no duty imposed on the landlord for tort liability – Common Passageways under Landlord’s control – what is a common area?

Back 281

Areas that the landlord still exercises dominion and control over

Front 282

Exception to no duty imposed on the landlord for tort liability – Negligent Repairs undertaken by landlord – rationale

Back 282

Courts treat Landlord’s conduct in making the earlier repairs as creating the deceptive appearance of safety and the courts treat this conduct as negligence. Doesn’t matter how conscientious he is.

Front 283

Exception to no duty imposed on the landlord for tort liability – Public Use Exception – three requirements to invoke

Back 283

[1] Landlord must know (or should know) of major defects; [2] Landlord must know (or should know) tenant will not fix the defect; [3] Landlord must know (or should know) that the public will be using the premises

Front 284

What is the general rule for a tenant’s tort liability?

Back 284

Tenant is ALWAYS liable to a third party invitee for negligent failure to correct dangerous conditions on the leased premises, regardless of whether the landlord may be liable as well.

Front 285

Two exam situations for fixtures

Back 285

[1] Landowner contracts to sell property and the contract is silent as to whether the seller can remove the chattel before closing; [2] Tenant has installed some item of personal property and the lease agreement is silent as to whether the tenant can remove t he chattel when he reaches the leased premises.

Front 286

General rule for fixtures

Back 286

Fixtures become part of the real property and cannot be removed by sellers or tenants

Front 287

When is an item of personal property to be treated as a fixture?

Back 287

The analysis turns on intent. Did the one doing the installing intend that the item of personal property remain with the real property as a fixture? Express Intent – If there is an agreement between the parties – the terms of the agreement control

Front 288

If there is no agreement between the parties as to what to do with fixtures, what four factors are relevant to determine intent?

Back 288

[1] Degree of Attachment; [2] General Custom; [3] Degree of harm to premises on removal; [4] Trade fixtures

Front 289

Fixtures – Degree of Attachment, generally

Back 289

The more that has to be done to attach the item, the more likely there is intent for the item to remain with the property as a fixture

Front 290

Fixtures – general custom, generally

Back 290

Is this the type of thing that sellers or tenants normally take w/ them when they leave?

Front 291

Fixtures – Degree of harm to premises on removal, generally

Back 291

Courts tend to favor tenants on this point. If the tenant can remove the item without substantial damage to the premises, then courts generally allow an inference that there was no intent that the item become a fixture.

Front 292

Fixtures – Trade Fixtures – generally

Back 292

Trade fixtures are NOT considered fixtures. They are chattels or items of personal property used in a trade or business.

Front 293

Can trade fixtures be removed? Example?

Back 293

Always. A power saw in a lumber mill.

Front 294

If an item of personal property is not a fixture, when can the item be removed (from tenant’s situation and seller’s situation)

Back 294

Tenant’s – the items must be removed before the tenant vacates at the end of the lease. Seller’s – The seller must remove the item before closing – or the seller will loose the chattel

Front 295

What is an easement?

Back 295

A non-possessory interest in land involving a right to use the land.

Front 296

What is the key concept for easements?

Back 296

The right of use

Front 297

What are the four main steps for dealing with easement questions?

Back 297

[1] Classify the easement; [2] Look at Method of creation; [3] Transfer of Easements; [4] scope of use of easement

Front 298

What are the types of easements?

Back 298

[1] Easements appurtenant; [2] Easements in gross

Front 299

What is an easement appurtenant? What is the burdened property called? The benefited property?

Back 299

Any time the easement directly benefits the use and enjoyment of a specific parcel of land. Burdened property = Servient. Benefitted Property = Dominant

Front 300

What is an easement in gross? What is a classic example?

Back 300

It occurs where there is no dominant estate b/c there is only one parcel of land involved, which is the property burdened by the easement – or the servient estate. Ex: Utility putting pipes underground or a railroad laying tracks.

Front 301

What are the different ways an easement can be created?

Back 301

[1] Express Easement; [2] Implied Easement; [3] Easement by Prescription

Front 302

What are the two ways and express easement may arise?

Back 302

[1] Express grant of an easement to someone else; [2] Express reservation of an easement when land is sold to another person

Front 303

Do easements of a year or less need to be in writing?

Back 303

No

Front 304

How can implied easements arise?

Back 304

[1] previous use by a common grantor (owner)(this can arise when an owner of a large piece of land sells off a smaller chunk); [2] Absolute right of access rule

Front 305

How can you obtain an implied easement by previous use by a common grantor/owner?

Back 305

There must be a previous use by a common owner and this previous use must satisfy three requirements: [1] Continuous; [2] Apparent (open & obvious); [3] Reasonably necessary

Front 306

What is the general rule for an absolute right of access rule?

Back 306

Ex: Bill has no way off his property after selling a portion of it to George. The owner of the servient estate (George) can choose the location of the easement so long as the choice is a reasonable one.

Front 307

How do easements by prescription arise?

Back 307

Very much like title arises by adverse possession.

Front 308

What are the requirements to establish a prescriptive easement?

Back 308

[1] Use must be adverse to the true owner (i.e., a trespass on title); [2] Use must be continuous and uninterrupted and must last for the specified statutory period (20 years at common law) (seasonal use may satisfy this req’t if appropriate under the circumstances (fishing cabin used in summer); [3] Use is visible and notorious or made w/ owner’s knowledge; [4] Use is without the owner’s permission (note – oral permission is enough to destroy hostility needed to establish a prescriptive easement)

Front 309

What happens when you transfer the dominant estate in easement appurtenant situations?

Back 309

The benefit is transferred automatically along with the dominant estate, whether or not the easement is mentioned in the deed of conveyance. All who subsequently succeed to title to the dominant estate become entitled to the benefit of the easement appurtenant.

Front 310

Can you transfer the easement appurtenant separately from the dominant estate?

Back 310

No

Front 311

Can an easement in gross that is commercial be transferred?

Back 311

Always

Front 312

Can an easement that is personal be transferred?

Back 312

No

Front 313

What is the general rule regarding the transfer of the servient estate?

Back 313

Easements are always binding on subsequent holders of servient estates – even if the easement is not specifically mentioned in the deed of conveyance – provided the subsequent holder had notice of the easement.

Front 314

What are the ways that a successor-in-interest to the servient estate may be put on notice of the easement?

Back 314

[1] Actual Knowledge or Notice; [2] Constructive Notice – arises from the fact that the document creating the easement is duly recorded in the buyer’s direct chain of title; [3] Inquiry Notice – arises from the buyer’s physical inspection of the land and the visible appearance of the easement on the land – OR – the notice that arises from the buyer’s inspection of the public records contained in the buyer’s direct chain of title

Front 315

What is the general rule for scope of use of easement?

Back 315

The specific terms of the easement control on questions of use.

Front 316

What are the two presumptions where the easement is silent on use?

Back 316

[1] unless otherwise specified, an easement is presumed to be perpetual (lasts forever); [2] the use presumed is that of reasonable development of dominant estate

Front 317

When an easement is silent on use, what is the general rule regarding reasonable development of the dominant estate?

Back 317

Reasonable development is that development which would likely have been contemplated by the parties at the time the easement was granted.

Front 318

Can an easement be used to benefit other estates besides the dominant estate?

Back 318

No. An easement can be used only to benefit the dominant estate.

Front 319

What is the remedy for excessive use of an easement?

Back 319

Enjoin the excessive use, but do not terminate the easement.

Front 320

There are four rules for repair of the easement.

Back 320

[1] The holder of the benefit of the easement (dominant estate) is responsible for making any necessary repairs to the easement. [2] The holder of the easement (dominant estate) can always go on the servient estate to repair the easement, even if the terms of the easement do not specifically provide for that right; [3] the holder of the easement must make a reasonable restoration of the servient estate after making repairs to the easement; [4] unless the easement says otherwise, the holder of the servient estate has no repair obligation.

Front 321

Generally, does the holder of a servient estate have a repair obligation?

Back 321

No

Front 322

What are the six ways an easement can be terminated?

Back 322

[1] Unity of Ownership – Doctrine of merger; [2] Deed of Release; [3] Abandonment by Action; [4] Termination by estoppel; [5] Termination by Prescription; [6] Termination of Easements Created by Necessity

Front 323

An easement may end by reason of its ______

Back 323

Own terms

Front 324

What’s the general rule for termination of an easement by unity of ownership?

Back 324

Whenever the dominant estate and the servient estates come together in the same owner, easement is terminated. Note – it cannot automatically revive if the owner sells part of the lot.

Front 325

What requirements are there for a deed of release to terminate an easement?

Back 325

The release must be in writing (satisfy the SOF) and must comply w/ all of the deed formalities.

Front 326

What’s the general rule for termination of an easement by abandonment by action?

Back 326

Mere non-use does not constitute abandonment. The intent to abandon must be manifested by the holder of the dominant estate taking some physical action that would show his intent to abandon. Need the ACTION

Front 327

What are two requirements for terminating an easement by estoppel?

Back 327

[1] A representation of relinquishment of the easement by the holder of the dominant estate; AND [2] the holder of the servient estate must make a change in his position in reliance on that representation.

Front 328

What’s the general rule for terminating an easement by prescription?

Back 328

The owner of the servient estate must stop the use of the easement – AND – must keep it stopped for the period of time required by the applicable statute of limitations.

Front 329

What’s the general rule for termination of easements created by necessity?

Back 329

Once the necessity that gave rise to an implied easement ceases to exist, then the implied easement will automatically terminate.

Front 330

What’s the rule for implied easements for view and sunlight?

Back 330

There are NO implied easements for view or sunlight.

Front 331

What’s a license?

Back 331

[1] A limited privilege to USE land in the possession of the licensor; [2] NOT a property interest; [3] is a contract right; [4] can always be revoked at the will of the licensor; [5] if the revocation is wrongful, the licensor may have to pay contract damages

Front 332

What’s the general rule for tickets and what are their classification?

Back 332

All tickets are licenses. Ticket holders do not acquire any property rights in the ticket, although they may sue for damages for breach of contract.

Front 333

How is an irrevocable license created?

Back 333

[1] If an easement is attempted but fails due to SOF, a license is created. [2] if money is spent on property in furtherance of an oral license, then that license becomes irrevocable

Front 334

What happens when an easement fails due to the SOF?

Back 334

A license is created.

Front 335

What are profits?

Back 335

A profit gives the right to go on to the land of another and take away natural resources (e.g., timber, coal, etc.). Along w/ the profit goes the implied easement to go on the land and remove the natural resource. Use the easement rules to analyze any situation involving a profit.

Front 336

How should you analyze profits situations on the exam?

Back 336

Use the easement rules to analyze any situation involving a profit.

Front 337

What does a restrictive covenant do?

Back 337

It gives the holder of the interest the right to restrict some third party in the use of his land.

Front 338

What are the two categories of restrictive covenants? What do they involve? What are the differences?

Back 338

[1] Covenants or promises) running w/ the land at law; and [2] Equitable servitude. Both involve a written promise (usually contained in a deed) that imposes a restriction on the use of land. The only difference is the theory used to enforce the terms of the restriction.

Front 339

If the plaintiff wants money damages, what is the restriction called?

Back 339

Covenant at Law

Front 340

If the plaintiff wants an injunction, what is the restriction called?

Back 340

Equitable Servitude.

Front 341

What are the four requirements to enforce a restrictive covenant at law?

Back 341

[1] Intent; [2] Notice; [3] Touch & Concern; [4] Privity

Front 342

Requirement #1 to enforce a restrictive covenant at law – Intent – generally

Back 342

The parties must intend that the restriction run w/ the land.

Front 343

Requirement #1 to enforce a restrictive covenant at law – Touch and Concern the Land – generally

Back 343

Use the same common sense test for touch and concern that is in assignments of landlord-tenant law. Rule: If performance of the covenant (promise) makes the land more valuable or more useful, the covenant touches and concerns the land. Note: Covenants to compete DO touch and concern the land.

Front 344

Requirement #1 to enforce a restrictive covenant at law – Privity generally

Back 344

Here, Privity simply refers to a conveyance between the parties. Two kinds – horizontal and vertical

Front 345

To determine what kind of privity must be present to enforce a restrictive covenant at law, we must distinguish the _____ from the ______ of the covenant.

Back 345

Benefit from the burden of the covenant.

Front 346

What is a bar exam hint for dealing with questions regarding privity under restrictive covenants at law?

Back 346

To determine what kind of privity is required, look to the facts of the question to see who the successor-in-interest is.

Front 347

Restrictive covenant at law – Privity – if the facts of the question show that the successor-in-interest is the Π, we know that __________

Back 347

That person is trying to establish that the benefit of the covenant runs to the Π.

Front 348

Restrictive covenant at law – Privity – if the facts of the question show that the successor-in-interest is the Δ, then we know that ______________

Back 348

The Π is trying to establish that the burden of the covenant runs to and binds the Δ.

Front 349

When the successor-in-interest is the Δ and the Π is trying to show that the burden of the covenant runs to and binds the Δ, what kind of privity is required?

Back 349

Both. Vertical Privity – refers to those who subsequently obtain the property subject to the covenant. These successors must take the full estate held by their predecessors. Horizontal Privity (refers to the original parties to the promise) – these two parties must share some interest in the land independent of the covenant. There must be a conveyance of the property between the original parties.

Front 350

What does horizontal privity refer to?

Back 350

The original parties to the promise.

Front 351

What must happen to establish horizontal privity?

Back 351

There must be a conveyance of the property between the original parties.

Front 352

When the successor-in-interest is the Π and he is trying to show that the benefit of the covenant runs to him, what privity is needed.

Back 352

ONLY Vertical Privity. On the benefit side, the general rule is: The holder of any succeeding possessory estate may enforce t he benefit of t he promise as a covenant at law. NO horizontal privity is required to enforce the benefit of a restrictive covenant.

Front 353

How many requirements are necessary to enforce the burden of a covenant at law when the s-i-i is the Δ?

Back 353

Four – Intent, notice, touch and concern, and Privity (Both)

Front 354

Equitable servitudes – what are the three requirements to obtain an injunction to enforce the burden of the promise as an equitable servitude?

Back 354

[1] Intent that the restriction can be enforced by Successors-in-Interest; [2] The restriction must touch and concern the land; [3] Notice to the subsequent purchaser (actual, constructive, inquiry). Note – NO privity (of any kind) is required to enforce the promise in equity as an equitable servitude.

Front 355

What are the requirements to enforce the benefit of a covenant (promise) as an equitable servitude?

Back 355

[1] Intent and [2] touch & concern.

Front 356

What’s the reasoning behind the enforcement of subdivision restrictions (reciprocal negative servitudes – or – mutual rights of Enforcement)

Back 356

This doctrine is relied on to allow each lot owner in a residential subdivision to enforce a restriction on use against every other lot owner in the subdivision.

Front 357

What are the requirements to establish a mutual right of enforcement?

Back 357

[1] An intent to impose a servitude (a restriction on use) on ALL land in the subdivision; [2] Notice (actual, constructive, inquiry)

Front 358

When looking at the intent to impose a servitude (a restriction on use) on all land in the subdivision, what is helpful to look at?

Back 358

A common building plan. The common building plan can be reflected in a recorded map. There can be a pattern of development that reflects the intent that each lot in the subdivision be restricted to residential use.

Front 359

Give an example of a dedication in a plan.

Back 359

In a plan for pleasant valley subdivision, 10 acres are reserved for a city park. The city can compel the use of the land as a park by construing the use restriction as a dedication, since the recorded subdivision plan has this land marked for use as a city park.

Front 360

What are the defenses to an enforcement of Covenant as an Equitable Servitude?

Back 360

[1] Unclean hands – Π has made same use of her property; [2] Acquiescence – Π let other neighboring land owners do the same thing on their lots; [3] Laches – Π sat by while Δ built the office building and only complained after the building project was completed; [4] Estoppel – Π represented that she had no problems w/ Δ’s plans to construct an office building

Front 361

What are the ways to terminate covenants or servitudes?

Back 361

[1] Deed of Release; [2] Merger – Unity of Ownership; [3] Changed Conditions

Front 362

Can you void residential use only restrictions by virtue of the changed conditions?

Back 362

Yes, if ALL the lots in the subdivision are affected. Rule – If all the lots in the entire subdivision are affected, then the use restriction will be eliminated. This is an ALL OR NOTHING proposition!

Front 363

Mnemonic for Adverse Possession

Back 363

H-E-L-U-V-A – [1] Hostile; [2] Exclusive; [3] Lasting; [4] Uninterrupted; [5] Visible; [6] Actual. If even one is missing, there is no AP.

Front 364

Statutes of limitations in ejectment cut off the True Owner’s right to recover possession of her land. Once this statute runs, the true owner loses _________

Back 364

Title to the property

Front 365

The issue in adverse possession cases is whether _____

Back 365

X being on the True owner’s land is merely a trespass or whether X has obtained title to the land by adverse possession.

Front 366

AP – H______?

Back 366

Hostile – X is on the land w/ no right to be there.

Front 367

AP – E ______?

Back 367

Exclusive – X must be excluding others from possessing the property

Front 368

AP - L______?

Back 368

Lasting – the possession must last for the statutory period. Apply the relevant time period as specified in the facts of the question. If no such time period is specified, use the common law period of 20 years.

Front 369

AP - U______?

Back 369

Uninterrupted – the kind of continuous waste that an ordinary owner of the property would make.

Front 370

AP - V______?

Back 370

Visible – X’s use and possession of the property is out in the OPEN (“Open & Notorious”)

Front 371

AP - A______?

Back 371

Actual – X, the adverse possessor, must actually possess the land to obtain title. There are two exceptions – The following things are not required: [1] O, the true owner, does not have to know what’s going on. [2] X, the adverse possessor, does not have to think he owns it.

Front 372

What is color of title?

Back 372

X makes some claim to title of the land, but his claim is not valid.

Front 373

What are the two exceptions to Adverse Possession?

Back 373

[1] Constructive Adverse Possession (CAP); [2] Leased Land

Front 374

Describe Leased Land and how it’s an exception to AP

Back 374

Leasing land to a 3rd party constitutes possession for purposes of adverse possession.

Front 375

Can you have AP against concurrent owners?

Back 375

NO adverse possession against a co-tenant unless the co-tenant in possession excludes the other co-tenants from possession and the statutory period runs. The exclusion starts the clock running for purposes of AP.

Front 376

What is the rule regarding AP and a Life Tenant and a Remainderman?

Back 376

The AP clock does NOT start to run against the holder of a future interest until that interest becomes possessory. (So X can adverse possess against a life estate holder, but not to the owner of the FS that follows until that FS holder obtains possession.)

Front 377

What is the goal of AP?

Back 377

To get the true owner to wake up, smell the coffee and go to the court house for an action for ejectment.

Front 378

General rule of tacking and AP

Back 378

An adverse possessor can tack together successive periods of adverse possession in order to satisfy the statutory period. Just as you can tack successive periods of AP, you can tack successive periods of true ownership. But Remember – NO GAPS IN POSSESSION!!!!

Front 379

AP and Disabilities – types and general rule

Back 379

The Three “I’s” – Infancy, Incarceration, Insanity. If the true owner is suffering from any of these three disabilities at the time the period of AP begins, then the clock for AP will NOT start to run until the True Owner is free of the disability.

Front 380

What happens with an intervening disability and AP?

Back 380

An intervening disability does not stop the clock. If the disability was NOT in existence on the day the AP begins, it will not keep the clock from running.

Front 381

Can you tack disabilities in AP?

Back 381

No. Ex: X, the true owner, was a minor when the period of AP began, and just before turning 18, he went insane. The statutory period begins running when he turns 18 even though he’s still crazy.

Front 382

Can you adversely possess government land?

Back 382

No

Front 383

Is AP title marketable?

Back 383

No. To make it marketable, there must be a court action to quiet title.

Front 384

What is the process for conveyancing?

Back 384

It’s a two-step process. First is the K of sale. Later, at the closing comes the actual conveyance – at which time real property concepts will control once again.

Front 385

Conveyancing – K of Sale & Escrow Period – what’s the general background?

Back 385

The K of sale of real property is governed by K law principles. K of sale exists from the moment it is signed until the deed is transferred at closing. This time period is generally referred to as the escrow period and during the escrow period, K law principles apply.

Front 386

What is the escrow period?

Back 386

The time from when the K of sale is signed until the time when the deed is transferred at closing.

Front 387

Conveyancing – K of Sale & Escrow Period – SOF general rule

Back 387

Any K for sale of any interest in real property must be in writing and signed by the one who is sued. This signed writing must include: [1] Description of property; [2] Names of the parties; [3] Price

Front 388

Conveyancing – K of Sale & Escrow Period – SOF – Doctrine of Part Performance – what is it and what requirements must be satisfied?

Back 388

Part Performance is an exception to SOF. Two Requirements: [1] The oral contract must be clear; and [2] The acts of partial performance must clearly prove up the existence of the K.

Front 389

Conveyancing – K of Sale & Escrow Period – Risk of Loss: Doctrine of Equitable Conversion – who bears the risk at CL?

Back 389

CL – Buyer bears risk b/c of equitable conversion. Once the K is signed, equity treats the property as buyer’s land, and therefore, the buyer bears the risk of loss. Since Equity stands ready to enforce the K for sale of an interest in real property through specific performance, equity treats the buyers as the owner of the property – even if the seller has remained in possession and control of the property. Note – this applies only if Seller is not at fault.

Front 390

Conveyancing – K of Sale & Escrow Period – Death of a party before close of escrow – general rule?

Back 390

B/c of equitable conversion, if either party to the K dies before closing, equity will still order specific performance of the K if necessary. The death of either party generally will not affect the rights of the parties as set out in the K.

Front 391

Conveyancing – K of Sale & Escrow Period – What happens if Seller dies before closing?

Back 391

Buyer will close the sale w/ Seller’s estate. Buyer will deliver the purchase price to seller’s estate. Seller’s interest is in personal property (i.e., the purchase price).

Front 392

Conveyancing – K of Sale & Escrow Period – What happens if Buyer dies before closing?

Back 392

Seller will close the sale w/ the buyer’s estate. Seller will deliver title to the property to buyer’s estate. Buyer’s interest is in real property

Front 393

Conveyancing – K of Sale & Escrow Period – What is the general rule for marketable title?

Back 393

Every land sale K contains an implied warranty that the Seller will deliver marketable title to the Buyer at close of escrow.

Front 394

Conveyancing – K of Sale & Escrow Period – Define Marketable title

Back 394

Marketable title is title that a reasonably prudent buyer would accept, which means minor defects do not matter (since they do not present significant threat of litigation).

Front 395

Conveyancing – K of Sale & Escrow Period – How does a seller satisfy the implied warranty to deliver marketable title?

Back 395

Seller must provide buyer w/ three things: [1] Proof of title – giver buyer some tangible evidence of title; [2] Title free of encumbrances; [3] Valid legal title as of date of closing

Front 396

What is the general rule of having a title free of encumbrances?

Back 396

Seller must give buyer title free of encumbrances – that is, no easements, no restrictive covenants, no mortgages, no options, etc. – other than those that have been previously disclosed to the buyer.

Front 397

Is a valid option an encumbrance?

Back 397

Yes. This is a breach of the warranty of marketable title.

Front 398

What are examples of encumbrances?

Back 398

Easements, restrictive covenants, mortgages, as well as any other type of private restrictions that have not been disclosed to the buyer.

Front 399

Is zoning an encumbrance?

Back 399

No. But violations of a zoning ordinance do constitute an encumbrance of title.

Front 400

Do violations of housing or building and safety constitute encumbrances?

Back 400

No

Front 401

Are mortgages considered to be encumbrances?

Back 401

Yes. However, a mortgage that will be satisfied out of the proceeds of the sale of the property is NOT an encumbrance.

Front 402

Conveyancing – K of Sale & Escrow Period – what if the buyer determines that the seller’s title is not marketable?

Back 402

Buyer must notify the seller of any defect in title and allow the seller a reasonable time to cure the defect – even if that means postponing the day for closing.

Front 403

Conveyancing – K of Sale & Escrow Period – What are the buyer’s remedies for Seller’s failure to deliver marketable title?

Back 403

[1] Rescission; [2] Damages; [3] Specific Performance – which will be coupled w/ a reduction in the purchase price to reflect the defects in seller’s title.

Front 404

Conveyancing – K of Sale & Escrow Period – Time of Performance – how do you know the date for closing?

Back 404

The K will specify the date for closing.

Front 405

Conveyancing – K of Sale & Escrow Period – What if one of the parties to the K fails to perform on the date specified in the K?

Back 405

No problem results as long as performance is rendered w/in a reasonable time. Reasonable Time = 2 months

Front 406

Conveyancing – K of Sale & Escrow Period – Time of Performance – General Rule

Back 406

Time is NOT of the essence in a land sale K unless: [1] The K says otherwise, OR [2] The facts make clear that the parties intend that time is of the essence.

Front 407

Conveyancing – K of Sale & Escrow Period – Is time of the essence in land sale contracts?

Back 407

NO. Unless: [1] the K says otherwise; OR [2] The facts make clear that the parties intend that time is of the essence.

Front 408

Conveyancing – K of Sale & Escrow Period – What if the K includes a time of the essence clause and it is violated?

Back 408

The party who failed to perform on time is in total breach and therefore cannot enforce the K.

Front 409

Remedies for breach of K for sale of Real Property – What is the measure for damages?

Back 409

The measure of damages is generally the difference between the K price and the value of the property as of the date of breach

Front 410

What is a liquidated damages clause?

Back 410

A provision that says Buyer’s deposit can be forfeited in the event of Buyer’s breach. It will be enforced as long as the amount is reasonable – which means that it should not exceed 10% of k price.

Front 411

Remedies for breach of K for sale of Real Property – is Specific performance available to buyer? To seller?

Back 411

Available to buyer b/c land is unique. Available to Seller.

Front 412

Remedies for breach of K for sale of Real Property – what happens at CL if there are defects on the property that render the property unfit for ordinary purposes?

Back 412

At CL, Caveat Emptor! Buyer cannot recover from seller. However, there was a CL exception that while the Seller has no obligation to disclose any defects to the buyer, the seller cannot actively conceal such defects.

Front 413

Remedies for breach of K for sale of Real Property – what happens under the modern approach if there are defects on the property that render the property unfit for ordinary purposes?

Back 413

There is a duty to disclose to prospective buyer serious defects in the property that the seller knows of and which are not obvious to buyer. This is now the majority rule in cases of sales of residential property.

Front 414

Remedies for breach of K for sale of Real Property – Modern rule of Implied Warranty of Fitness – what happens in majority of states?

Back 414

There is an implied warranty of fitness (or merchantability) that applies only to the sale of new residential housing by a builder/seller. But the CL rule of Caveat Emptor continues to apply in all other situations, such as commercial paper, sale of agricultural land, sale of industrial land, and everything else.

Front 415

Conveyancing – Deed Formalities – general rule

Back 415

Once the deed has been accepted at closing, the K is extinguished

Front 416

Conveyancing – Deed Formalities – what happens on closing?

Back 416

The K merges into the deed and all K provisions are extinguished unless: [1] K specifies they survive closing; OR [2] They are included in the deed itself.

Front 417

What two requirements must be satisfied for the deed to pass title?

Back 417

[1] Execution and [2] Delivery

Front 418

Conveyancing – deed formalities – describe the relationship w/ the SOF

Back 418

The deed is subject to the SOF, just like the K of sale. There must be a writing signed by the seller

Front 419

Conveyancing – Deed Formalities – general rule of execution of the deed

Back 419

The deed must describe the land w/ sufficient accuracy in order to pass title. That means the description must enable you to identify the property that is being transferred. If you can’t identify the property, then the deed is void for vagueness and nothing gets transferred.

Front 420

What happens if you can’t identify the property in a deed?

Back 420

The deed is void for vagueness and nothing gets transferred.

Front 421

What kind of description controls in a deed?

Back 421

A land description by metes and bounds will control over description by acreage or any other description.

Front 422

Conveyancing – Deed Formalities – Delivery of the deed – general rule

Back 422

The legal test for delivery is solely a question of whether the grantor had the necessary intent to pass title. No physical transfer of the deed is required.

Front 423

Conveyancing – Deed Formalities – Delivery of the deed – do you need physical delivery?

Back 423

No. -

Front 424

Conveyancing – Deed Formalities – what kind of presumption does recording a deed raise?

Back 424

It raises a presumption of delivery, even if the Grantee knows nothing about the deed.

Front 425

Conveyancing – Deed Formalities – what happens once delivery occurs?

Back 425

Title passes. Returning the deed to the Grantor has no effect on title.

Front 426

Conveyancing – Deed Formalities – can you use parol evidence to show intent regarding delivery?

Back 426

Yes, if showing the Grantor’s intent regarding delivery

Front 427

Conveyancing – Deed Formalities – if the grantor dies and the deed is still in his possession, what happens?

Back 427

There is a presumption of no delivery, which may be rebutted by Grantee.

Front 428

Conveyancing – Deed Formalities – what if the grantor hands over the deed as a delivery of a future interest? Ex: the deed language is “to A, but not until I die,” and the deed is handed to grantee. This is ….

Back 428

A valid delivery of a future interest. O has LE and A has vested remainder in FS

Front 429

Conveyancing – Deed Formalities – what if the grantor hands over the deed as an Oral Condition. Ex: The deed language is “Xena to Hercules,” but in handing over the deed Xena tells Hercules that “of course, this won’t become effective unless you vaporate Gabriella.”

Back 429

Xena – Nothing. Hercules – FSA. The plurality says to ignore the oral condition and consider delivery complete.

Front 430

Conveyancing – Deed Formalities – what if the grantor hands over the deed with the delivery conditioned on Grantee’s payment of purchase price?

Back 430

This is valid provided: [1] Grantor makes delivery of deed to a third party in escrow. Grantor instructs escrow agent to deliver deed to grantee when the condition is satisfied (oral instructions are sufficient); and once the grantor delivers the deed to the escrow agent, the grantor cannot get the deed back. So long as the grantee satisfies the condition, then the grantee gets the property.

Front 431

Conveyancing – Deed Formalities – must the delivery be accepted to be valid?

Back 431

Delivery of a deed is valid only if the deed is accepted. Acceptance will be implied, unless the facts show otherwise. Consideration is not required in order for the deed to be valid.

Front 432

Conveyancing – Covenants of Title – what is a quitclaim deed?

Back 432

The grantor makes no promises regarding title

Front 433

Conveyancing – Covenants of Title – what happens when a grantor makes promises regarding title?

Back 433

These are called Covenants for Title.

Front 434

Conveyancing – Covenants of Title – Deeds that include the six traditional forms of Covenants for Title are called _______

Back 434

General Warranty Deeds

Front 435

Conveyancing – Covenants of Title – What are the different Covenants?

Back 435

3 Present Covenants – [1] Cov. of Seisin; [2] Cov. of Right to Convey; [3] Cov. against Encumbrances. 3 Future Covenants – [1] Cov. of Quiet Enjoyment; [2] Covenant of Warranty; [3] Covenant of Further Assurances (the mop-up covenant)

Front 436

Conveyancing – Covenants of Title – how are Present Covenants breached?

Back 436

A present covenant is breached, if at all, at the moment the conveyance is made; and therefore the buyer can sue on a present covenant immediately. These three present covenants are personal to the grantee and do not run w/ the land.

Front 437

Conveyancing – Covenants of Title – which of the present covenants represent the seller’s promise that seller has title and possession and can validly convey both?

Back 437

Cov. of Seisin and Cov. of Right to convey

Front 438

Conveyancing – Covenants of Title – Present Covenants – What does the Seller promise when he makes a Cov. Against Encumbrances?

Back 438

That there are NO encumbrances – other than those that have been previously been disclosed to the buyer.

Front 439

Conveyancing – Covenants of Title – How are Future Covenants breached?

Back 439

A future covenant is not breached immediately, i.e., at the time the conveyance is made. A future covenant is breached, if at all, at some later date when the Grantee is disturbed in possession. Future covenants do run with the land and therefore can be enforced by all subsequent purchasers.

Front 440

Conveyancing – Covenants of Title – Which two future covenants represent the Seller’s promise to protect the buyer against anyone who comes along later and claims paramount title to the property?

Back 440

Covenant of Quiet Enjoyment & covenant of Warranty

Front 441

Conveyancing – Covenants of Title – what is the covenant of Further Assurances?

Back 441

If Seller omitted something required to pass valid title, Seller promises to do whatever is necessary to pass title to buyer.

Front 442

Conveyancing – Covenants of Title – Do future covenants run with the land?

Back 442

Yes. This means that they can be enforced by any subsequent purchaser.

Front 443

Conveyancing – Covenants of Title – What are the damages when there is a breach of warranty?

Back 443

Π’s damages will be limited to the amount of purchase price received by the warrantor plus incidental damages.

Front 444

Conveyancing – Estoppel by Deed Doctrine – What is the definition?

Back 444

Courts say that the Grantor gave an implied covenant that title will be conveyed to the Grantee. Therefore, that Grantee can sue to compel the transfer of title from the grantor.

Front 445

Conveyancing – Estoppel by Deed Doctrine – What happens w/ a sale to a BFP?

Back 445

A Sale to a BFP will cut off the rights of an earlier Grantee and therefore will cut off that Grantee’s right to rely on the Estoppel by Deed Doctrine.

Front 446

Conveyancing by Will – What is the general rule of Ademption?

Back 446

If the will purports to devise a specific parcel of land, but testator does not own the land at time of her death, the gift is adeemed. This means that the testamentary gift fails and it will not be replaced by other property.

Front 447

Conveyancing by Will – does Ademption apply to a gift of property that was subject to an executory contract of sale?

Back 447

No. It does NOT apply to a gift of property that was subject to an executory contract of sale (“in escrow”) at the time of the testator’s death; instead the devisee will receive the proceeds from the sale of the property.

Front 448

Conveyancing by Will – how does Exoneration happen?

Back 448

If the devised property is subject to a mortgage or other lien, that lien must be exonerated from the testator’s estate. That is, the devisee is entitled to have the lien paid off from the testator’s residuary estate. The property will pass to the devisee free of the lien. The growing trend is to abolish this doctrine, which means that devisee will take the property subject to the mortgage.

Front 449

Conveyancing by Will – Lapse and anti-lapse statutes at CL and under the Modern Rule

Back 449

CL – if the beneficiary died before the testator, the gift in the will lapsed – that is the gift was VOID. Modern Rule – Majority of the states have adopted anti-lapse statutes that prevent lapse by allowing the gift to pass to certain relatives of the predeceasing beneficiary.

Front 450

Ownership Interests in Trust – What is a Trust?

Back 450

An express private trust is created, in writing, by a settlor who transfers title to real property to a trustee, who holds and manages the property subject to a Fiduciary duty to use the highest care and skill for the benefit of the beneficiaries of the trust.

Front 451

Ownership Interests in Trust – How is a trust created?

Back 451

A trust can be created inter vivos by deed OR by a will at death

Front 452

Ownership Interests in Trust – Trustees – what do they hold, what are their duties, and what happens when they die?

Back 452

A trustee holds legal title to real property. Trustee must act in accordance with the Settlor’s written instructions (if any). The trustee is subject to strict fiduciary duty (must be highest decree of care). If the trustee dies, the court can appoint a substitute.

Front 453

Ownership Interests in Trust – is a trust subject to RAP?

Back 453

Yes. The rule operates in exactly the same manner in the case of trusts, as it did earlier when we discussed the application of the rule to transfers by deed.

Front 454

Ownership Interests in Trust – What is a charitable trust?

Back 454

Unlike express private trusts, charitable trusts do NOT have named individuals as beneficiaries. Instead, the beneficiaries of charitable trusts are either established charities OR large groups of persons (Katrina victims – no named individuals). Also, there is the charity-to-charity exception to RAP

Front 455

Ownership Interests in Trust – what is the Cy Pres Doctrine?

Back 455

A court may alter the terms of a charitable trust in order to further the Settlor’s intent, (i.e., “cy pres” meaning “as near as can be.”)

Front 456

What fundamentally distinguishes real and personal property?

Back 456

Retention of interests in real property once such interests are acquired is what fundamentally distinguishes real from personal

Front 457

What is the essential purpose of recording statutes?

Back 457

[1] The purpose of these statutes is to change the CL rule of “first in time, first in Right”. [2] In order to protect the interests of subsequent purchasers in certain situations; [3] generally speaking, the purpose of the recording statute is to let the subsequent purchaser keep the property – provided that the subsequent purchaser can meet the requirements of the applicable recording statute.

Front 458

What happens if the subsequent purchaser does not satisfy the requirements of the applicable recording statute?

Back 458

Apply the CL rule – First in Time, First in Right. Under the CL rule, subsequent purchasers always LOSE.

Front 459

Is an unrecorded deed valid between the original parties?

Back 459

Yes. Just as valid between the original parties as a recorded deed recording only serves to give notice of the deed.

Front 460

How does recording occur?

Back 460

[1] Court clerk files a copy of the deed in a book (or microfilm). He makes note of the volume and page number where the copy of this deed can be found. [2] The clerk will then index this information in two indices (a) Grantor Index and (b) Grantee Index

Front 461

How does the court clerk list in a grantor index?

Back 461

The clerk lists the transaction alphabetically by Grantor, noting the name of the Grantee, a brief description of the property, and citing to the volume and page number of the book (microfilm) where a fully copy of the deed can be found.

Front 462

How does a court clerk list in a grantee index?

Back 462

The clerk lists the same information as that in a grantor index – alphabetically by grantee.

Front 463

What are the three types of recording acts?

Back 463

[1] Notice; [2] Race; [3] Race-Notice

Front 464

Who does a notice jdxn protect and how?

Back 464

A Notice Statute protects subsequent Grantees who are BFPs. The sole inquiry is notice and therefore a notice statute protects a subsequent purchaser for value who takes w/o notice of the earlier conveyance. Recording is important only to the extent that it imparts constructive notice of the earlier conveyance.

Front 465

What is a BFP?

Back 465

A purchaser for value who takes without notice of the earlier transaction.

Front 466

What is the general description of a Race jurisdiction?

Back 466

Notice is irrelevant. Whoever records first keeps the property. Subsequent purchaser does not have to be a BFP.

Front 467

What is the two-part test for a Race-Notice Jdxn?

Back 467

It protects all subsequent grantees who are BFPs for value who: [1] take without notice & [2] are the first to record.

Front 468

What is the strategy for identifying the type of recording statute?

Back 468

[1] Look for words Without Notice – or the words – In Good Faith – which means the statute is either a Notice OR a Race-Notice statute. [2] Look for the words Recorded First or First Recorded – which indicate a Race-Notice statute. If these words are NOT present, then the statute is a Notice statute. [3] If the quoted language does NOT include the word Notice or the words – In Good Faith – then it is a pure Race act.

Front 469

What kind of recording statute? Without Notice

Back 469

Notice or Race-Notice

Front 470

What kind of recording statute? In Good Faith

Back 470

Notice or Race-Notice

Front 471

What kind of recording statute? Recorded First

Back 471

Race-Notice

Front 472

What kind of recording statute? First Recorded

Back 472

Race-Notice

Front 473

What kind of recording statute? No mention of First Recorded or Recorded First

Back 473

Notice

Front 474

What kind of recording statute? If there is no mention of Notice

Back 474

Race

Front 475

What kind of recording statute? If there is no mention of In Good Faith

Back 475

Race

Front 476

What is the general rule for a BFP?

Back 476

A BFP is a bona fide purchaser for value who takes without notice

Front 477

What is the general rule for purchasing for value?

Back 477

Unless there is an explicit claim of fraud, any consideration that is out of pocket (i.e., more than a mere peppercorn) is enough to be considered value.

Front 478

Does a bargain basement sale qualify as purchasing for value?

Back 478

Yes.

Front 479

BFP – Purchase for Value – what happens when the transferee is an heir, donee, or devisee?

Back 479

One who purports to take property as an heir, devisee or donee cannot be a BFP (as they are not out-of-pocket anything), and therefore cannot prevail over the claim of an earlier grantee.

Front 480

BFP – Purchase for Value – what is the shelter rule exception?

Back 480

Anyone (even heirs, donees, or devisees) can take shelter under the rights of a BFP.

Front 481

BFP – Purchase for Value – Describe actual notice

Back 481

If the subsequent purchaser had actual notice of the prior unrecorded conveyance, then the subsequent purchaser is NOT a BFP.

Front 482

BFP – Purchase for Value – Does the shelter rule exception apply to actual notice?

Back 482

Yes. Anyone (even those who actually knew of an earlier conveyance) can shelter under the rights of a BFP. Moral of the story – In order to protect the right of the BFP to sell the property and convey good title, the shelter rule protects anyone who takes form a BFP – regardless whether they are purchasers for value and no matter what they know.

Front 483

BFP – Purchase for Value – Describe Record Notice

Back 483

It’s a constructive notice arising from the record. In order to impart notice, a deed must be recorded in the buyer’s direct chain of title – so that a subsequent purchaser can find it and inspect it.

Front 484

What are the three types of notice for a BFP under recording statutes?

Back 484

[1] Actual; [2] Record; [3] Inquiry

Front 485

BFP – Purchase for Value – Describe Inquiry notice

Back 485

In order to be a BFP who takes w/o notice, the subsequent purchaser must examine the land and must make inquiry as to any unexplained uses or possessions. The subsequent purchaser will be charged w/ notice of whatever such a physical inspection of the property would reveal.

Front 486

What subsequent interests are protected by the recording statutes?

Back 486

[1] Subsequent mortgages. But NOT judgment creditors.

Front 487

How do you construct a chain of title using the Grantee index?

Back 487

Look up seller’s name and find name of seller’s grantor, then look up name of that person’s grantor, and so on, going backwards in time for whatever period of time is required by the marketable title statute.

Front 488

How do you adverse each link using the grantor index?

Back 488

Look up the name of the last grantor found in the chain of title just constructed and see if that person recorded any interest on the property, starting from the time they got the property until the time they passed title onto the next link in the chain of title. Specifically, look to see if Grantor placed any encumbrances (easements, mortgages, etc.) on the property. Alternatively, look to see if the Grantor conveyed the property to someone else before passing the property on to the next link in the chain. Repeat this search for each Grantor in the chain of title leading down to prospective seller.

Front 489

What is the concept of legal blinders and why is it important?

Back 489

It means that the title searcher examines only the actions taken by the grantor during the period of record ownership by grantor. It’s key to understanding what is disclosed during the course of a title search. Therefore, the title searcher does NOT look for anything that a Grantor may have done before obtaining title to the property. Nor does the title searcher look for anything that a grantor may have done after passing title on to the next grantor – on to the next link in the chain of ownership.

Front 490

Legal Blinders summary

Back 490

The title searcher looks only at the Grantor’s actions during his or her period of record ownership.

Front 491

Legal Blinders – What ways can a deed by filed at courthouse and not be in chain of title?

Back 491

If the deed was recorded too early or too late.

Front 492

What are the roles of inquiry notice in the title search? (2 rules)

Back 492

[1] where a reading of the deeds on record discloses an unrecorded transaction, then the subsequent purchaser has to make inquiry in order to take w/o notice and qualify as a BFP. Subsequent purchasers are on notice of anything that is mentioned in a deed recorded in the direct chain of title. [2] To qualify as a BFP w/o Inquiry notice, the subsequent purchaser must make a physical inspection of the property – and must investigate any unexplained possessions or any unexplained uses of the property.

Front 493

What is a security interest in real property?

Back 493

A devise used to secure a loan on the property. Typically, the loan is reflected in a promissory note given by the borrower and the security interest is reflected in a separate written instrument.

Front 494

What is a mortgage?

Back 494

A mtg is given by the debtor (mortgagor) to the creditor (mortgagee)

Front 495

What happens if a loan is not paid in full in mortgage situations?

Back 495

If the loan is not paid in full, the sheriff sells the land at a court ordered foreclosure sale

Front 496

What is an equitable mortgage?

Back 496

An absolute deed w/ separate promise of reconveyance.

Front 497

How do you foreclose upon equitable mortgages and sale leasebacks?

Back 497

Like mortgages. They receive all the protections of a mortgage.

Front 498

What happens with a deed of trust?

Back 498

It’s given by the debtor to a third party trustee, who holds it until the loan is paid in full.

Front 499

What happens if the loan in a deed of trust situation is not paid back?

Back 499

The trustee can do one of the following: [1] Trustee can obtain a court order for a foreclosure sale of the property; OR [2] Trustee can sell the property by himself at a public auction.

Front 500

What’s a land sale contract?

Back 500

The installment land sale contract refers to the arrangement where the debtor signs a contract promising to make payments to the seller/lender BUT the seller keeps title to the property until the loan is paid in full.

Front 501

What’s the debtor’s right of redemption?

Back 501

The Equity of Redemption. At any time, right up until the moment of the foreclosure sale, the debtor can redeem the property by paying the amount that is due and payable – the amount in arrears (plus interest) unless the mortgage includes an acceleration clause.

Front 502

What is an acceleration clause?

Back 502

It means that the debtor must pay off the entire balance of the mortgage in order to redeem the property.

Front 503

Can you waive the equity of redemption?

Back 503

The EoR cannot be waived in the original mortgage or deed of trust – BUT can be waived later if there is separate consideration for the waiver (i.e., as when borrower later loses his job and so lender agrees to extend maturity date of loan.

Front 504

What happens if an attempt to waive the equity of redemption occurs?

Back 504

An attempt to waive the right to redemption in the original mortgage or deed of trust is generally referred to as clogging the equity of redemption and is prohibited.

Front 505

What is a statutory right of redemption?

Back 505

Approximately half the states allow the mortgagor (borrower) a statutory right to redeem the property for some fixed period of time after the foreclosure sale has occurred (typically six months to a year)

Front 506

What is the general rule on priorities of payment of multiple mortgages?

Back 506

Where there are multiple mortgages on a single property, priority is allocated based on the CL rule of First in time, First I Right unless that order is changed by the terms of the applicable recording statute.

Front 507

What happens when there are multiple mortgages on a single property and a mortgage was not recorded or recorded late?

Back 507

You may have to apply the terms of the applicable recording statute to determine how to allocate priorities among multiple mortgages. The recording statute is to be applied in the same way as if you were dealing w/ a deed.

Front 508

What happens in a voluntary subordination?

Back 508

A senior mortgage may agree to subordinate to a junior mortgage (mtg that comes later in time)

Front 509

What is a Purchase Money Mortgage?

Back 509

A PMM is a mortgage taken out to buy the property.

Front 510

What is the general rule of a PMM? Does a PMM of a seller or 3rd party lender have priority?

Back 510

It receives priority over any other mortgages executed at about the same time – even if the other mortgages are recorded first. A PMM given by the seller gets priority over a PMM given by a 3rd party lender, such as a bank.

Front 511

What happens to changes in senior mortgages?

Back 511

If the mortgagor does anything to increase a senior mortgage, (e.g., borrower more money or increases interest rate), then that senior mortgage loses its priority over junior mortgages – BUT ONLY to the extent of the change.

Front 512

What is the rule of foreclosure and junior & senior interests?

Back 512

Foreclosure wipes out all junior interests (interests coming later) – BUT foreclosure does not wipe out senior interests (those that came earlier in time). Senior interests just continue in place; the buyer will take the property subject to the senior interest. On foreclosure, ALL junior interests (liens, easements, leases, etc.) are wiped out in foreclosure of a senior mortgage.

Front 513

What protections are given to junior interests in foreclosures?

Back 513

They have the right to pay off any mortgage being foreclosed on in order to keep their junior interests from being wiped out. Thus, junior interests are a necessary party to any foreclosure proceeding. If they are NOT made a party to any foreclosure, then their junior interests are NOT eliminated by the foreclosure.

Front 514

What’s the order of payment of proceeds from a foreclosure sale?

Back 514

[1] Pay cost of foreclosure; [2] Pay off mortgage that was foreclosed on; [3] Pay off junior interest; [4] pay any remaining balance to mortgagor.

Front 515

What happens if the mortgage was foreclosed on, but the foreclosure sale does not raise sufficient funds to pay off the mortgage?

Back 515

Allow the mortgagee/creditor to sue the debtor personally for the balance due.

Front 516

What is a forfeiture clause?

Back 516

If a debtor misses a payment, the seller can cancel the K, keep all the monies paid to date, and retake the property.

Front 517

How is a forfeiture clause enforced?

Back 517

If the seller chooses to enforce the forfeiture clause, the seller is limited to that remedy and cannot obtain damages or specific performance.

Front 518

What happens to a mortgage when a mortgagor transfers the property?

Back 518

Whenever the grantor transfers title to the property, the grantee automatically takes the property subject to the mortgage. The mortgage still has to be paid – OR – the mortgagee will foreclose on the property. So the grantee is subject to losing the property in a foreclosure sale.

Front 519

What is the grantee’s personal liability on the mortgage when the mortgagor transfers the property? What happens if the mortgagee and grantee modify the obligation?

Back 519

The grantee will not be personally liable on the mortgage unless the grantee specifically assumes the mortgage. If the modify the obligation, then the original mortgagor is release of all liability.

Front 520

What’s the general rule when a mortgagee transfers a note?

Back 520

The mortgagee can freely transfer the note and the mortgage will always follow the note it secures.

Front 521

Is a holder in due course bound by payments to a prior mortgagee?

Back 521

A holder in due course is NOT bound by payments to a prior mortgagee even if the mortgagor knew nothing about the transfer of the note to the successor mortgagee, a holder in due course.

Front 522

To be treated as a holder in due course, the following requirements must be met:

Back 522

[1] the note must be negotiable, which means that it must be either (a) payable to bearer or (b) payable to the order of a named payee; [2] The original note must be endorsed by the named payee; [3] the original note must be delivered to the transferee; [4] the transferee must take the note in good faith and must pay value for it.

Front 523

What is a due on sale clause?

Back 523

It says that if the mortgagor transfers the property without the Mortgagee’s consent, the full amount of the loan becomes immediately due and payable. These are ENFORCEABLE

Front 524

What’s the general rule of security interests in fixtures?

Back 524

A seller of a fixture who provides a PMSI in the chattel must make a UCC Article 9 fixture filing w/in 20 days after attachment. If the seller of that chattel made the filing in a timely manner, Seller may move the fixture w/o regard to the priority of the earlier mortgage – the earlier security interest on the property. BUT, if a fixture filing is NOT made in a timely manner, then the seller’s security interest in the chattel is subordinate to the earlier mortgage on the property.

Front 525

What are the general rules for lateral support – support from the sides?

Back 525

A landowner has the right to have her land supported by adjoining landowners and strict liability if the land is not supported. The landowner will be strictly liable for improvements to land only if the land would have collapsed anyway, even without the weight of the improvement, i.e., if the land would have collapsed anyway, even w/o these buildings on it.

Front 526

What is the general rule for subjacent support – support of the surface from the bottom?

Back 526

Problems involving Rights of subjacent support arise where the mineral rights have been legally severed from the surface rights. Surface owners have the right to have their land supported from the bottom and strict liability will result if the land is not supported.

Front 527

What is the scope of subjacent support?

Back 527

This right extends to the land and to those improvements that were existing on the land as of the date the mineral rights were severed from the fee simple.

Front 528

What is riparian?

Back 528

It refers to those whose property borders on a lake or stream

Front 529

What’s the majority rule for riparian rights for domestic use? For non-domestic use?

Back 529

A riparian owner may use all water needed for domestic purposes. Riparian owners are limited to a reasonable use for non-domestic purposes, that is, commercial or industrial uses.

Front 530

What’s the minority rule for rivers and lakes?

Back 530

Prior Appropriation. First in time takes! The first person who makes beneficial use of water from a lake or stream has that right protected against those who come later, so long as the use continues. Priority in time determines all rights.

Front 531

What’s the rule for underground water?

Back 531

Landowner is entitled to reasonable use of ground water, although the landowner must use it on the property and NOT export it elsewhere.

Front 532

What’s the rule for surface water (runoff or flood water)?

Back 532

No majority rule. There are two competing approaches, each w/ about half the states. [1] Natural Flow approach; [2] Common Enemy Approach

Front 533

What’s the natural flow approach for surface water (runoff or flood water)?

Back 533

This requires a landowner not to make any changes at all in the flow of the flood water as it rushes across the surface of the land. But it is almost impossible to follow this approach and still make productive use of the land. Therefore, modern courts allow the landowner to take reasonable means to deal w/ surface waters.

Front 534

What’s the common enemy approach for surface water (runoff or flood water)?

Back 534

Landowner can do anything he wants with floodwater – whether reasonable or not.