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147 Cards in this Set

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EASEMENTS
the holder of an easement has the right to use a tract of land (called servient) for a special purpose, but has no right to possess and enjoy the tract of land.

Easements subject the owner of a servient land to the limitation that he cannot interfere with the right of special use created in the easement holder.
AFFIRMATIVE EASEMENTS
An affirmative easement is the right of one person to enter the property of another and “do something thereon”.
NEGATIVE EASMENTS
A negative easement prevents the owner of land from using the land for a purpose or in a way that would otherwise be permitted.
NOTICE
A buyer of land will have notice if:

he has actual knowledge of the easement,

if there was record of the easement he will be assumed to have done a title search,

or by constructive (physical) notice
EASEMENT APPURTENANT
an easement attached to and benefiting a dominant estate and burdening a servient estate.

If the dominant land is sold but no easement is mentioned the easement will run with the land automatically.

If the servient land is sold but no easement is mentioned the buyer will take subject to the easement if he had notice of it when he bought it.
EASEMENT IN GROSS
an easement that is a personal right of its holder to a use of another's land and that is not dependent on ownership of a dominant estate called also personal easement.
EXPRESS EASEMENT
Any easement for more than one year must be in writing and signed by the holder of the servient tenement, as required by the Statute of Frauds.

An express grant of an easement must comply with all the formalities of a deed.
AN IMPLIED EASEMENT REQUIRES FOUR ELEMENTS
Common ownership

Reasonably apparent use at severance

A quasi-easement before severance, and

a reasonably necessary,

or in Arizona a very convenient use to enjoy the dominant estate.
EASEMENT BY NECESSITY
An easement by necessity is created and implied by law where a land owner has no other means of access to the land.

In Arizona, courts have recognized an easement by necessity when necessary to provide “reasonable access” to property.
IMPLIED EASEMENT (BY OPERATION OF LAW)
When an owner severs property into two parcels in such a way that an already

existing,
obvious, and
continuous use

of one parcel (as for access) is necessary for the reasonable enjoyment of the other parcel.

The type of easement is an exception to the writing requirement of the Statute of Frauds.
EASEMENT BY PRESCRIPTION
The long and continuous use of property may give rise to an easement by prescription. A prescriptive easement requires the use to be: open and notorious, continuous and uninterrupted , adverse for the statutory period of 10 years in Arizona.
EXTENT OF THE ENCUMBERANCE OF AN EASEMENT
The manner in which the easement is dictates the scope and the extent of the encumbrance on the property.
SCOPE OF EXPRESS EASEMENTS
the grantor of an express easement can specify the nature, extent and precise location of the easement.
SCOPE OF IMPLIED AND NECESSARY EASEMENTS
an implied or necessary easement, the nature, extent and location must be reasonable under the circumstances.
SCOPE OF PRESCRIPTIVE EASEMENTS
a prescriptive easement based upon historic use, the easement will be limited to the nature, extent and location of the prior use.
TERMINATION OF EASEMENT
an easement is presumed to be of perpetual duration unless the grant specifically expresses a limit to the interest.
EXPRESS STATED CONDITIONS
the original easement grant may specify when or under what conditions the easement will terminate.
MERGER
if the same person acquires ownership of both the easement and the servient estate, the dominant and servient estates merge and the easement is destroyed and will not automatically be revived.
RELEASE
any type of easement can be terminated by deed of release from the owner of the easement to the owner of the servient land.
ABANDONMENT
an easement is terminated when its holder demonstrates by physical action an intent to permanently abandon an easement.
ESTOPPEL
oral expressions of an intent to abandon do not terminate an easement unless in writing (release) or by action (abandonment). But if the owner of the servient estate changes his position in reasonable reliance on the representations made or conduct by the owner of the easement, the easement terminates by estoppel.
TERMINATION OF AN EASEMENT BY PRESCRIPTION
to terminate by prescription there must be adverse, continuous interruption of the use for the prescription period. (10 years in AZ).
TERMINATION OF AN EASEMENT BY NECESSITY
an easement created by necessity terminates when the necessity ends.
CONDEMNATION AND DESTRUCTION
condemnation of the servient estate terminates all easements. The easement holder may get compensation.
LICENSES
A license is a revocable, inalienable privilege to the holder to go upon the land of another.
PROFITS
Profits entitle the holder of the benefit to take some resources from the servient estate.
COVENANTS RUNNING WITH THE LAND
a covenant should be in writing, be given for consideration, be notarized, state that it binds and benefits future owners, successors and assignees.
COVENANTS REQUIREMENTS FOR BURDEN TO RUN
if the following requirements are met, any successor interest to the burdened estate will be bound by the covenant.

Intent
Notice
Horizontal Privity
INTENT
the original parties to the covenant must have intended that successors in interest be bound by the terms. May be inferred from circumstances surrounding the creation. Notice
HORIZONTAL PRIVITY
There is horizontal privity where the original covenantor, at the moment of conveyance, had a simultaneous interest in land
COVENANTS REQUIREMENTS FOR BENEFITS TO RUN
If the following three requirements are met the promisee’s successor interest may enforce the covenant:

Intent
Vertical Privity
Touch and Concern
VERTICAL PRIVITY
To be bound the successor in interest to the covenanting party must hold the entire durational interest held by the covenantor at the time he made the covenant.
TOUCH AND CONCERN
a covenant touches and concerns the land if it restricts the holder of the servient parcel in his use or obligates the holder of a servient parcel to do something with his land.
REMEDY FOR BREACH OF A REAL COVENANT
A breach of a real covenant is remedied by an award of money damages, collectible from the defendant’s assets.
INJUNCTION FOR BREACH OF A REAL COVENANT
If an injunction is sought, the promise must be enforced as an equitable servitude rather than a real covenant.
EQUITABLE SERVITUDES
an equitable servitude is a covenant that regardless of whether it runs with the land at law, equity will enforce against the assignees of the burdened land that had notice of the covenant.
CREATION OF AN EQUITABLE SERVITUDE
by covenants contained in a writing that satisfies the Statute of Frauds. Negative Equitable Servitudes may be implied from a common scheme for development of a residential subdivision.
EQUITABLE SERVITUDE REQUIREMENTS FOR BURDEN TO RUN
Intent,
actual, inquiry, or record of notice,
touches and concerns
EQUITABLE SERVITUDE REQUIREMENTS BENEFITS TO RUN
Intent,
touches and concerns
DEFENSES TO ENFORCEMENT OF EQUITABLE SERVITUDE
Unclean Hands acquiescence estoppel laches neighborhood has changed
ADVERSE POSSESSION
Title to real property may be acquired by adverse possession. Title by adverse possession results from the operation of the statute of limitations for trespass.
REQUIREMENTS FOR ADVERSE POSSESSION
Open and Notorious Continuous Exclusive Actual Non-Permissive (hostile) Statutory period
OPEN AND NOTORIOUS
possession must be visible but title owner need not get actual notice
CONTINUOUS
must be continuous throughout the statutory period.
EXCLUSIVE
the possessor may not be sharing with the true owner or the public.
ACTUAL
only gain title to land actually possessing.
NON-PERMISSIVE (HOSTILE)
possessor enters without the owner’s permission.
STATUTORY PERIOD
In Arizona it is 10 years.
DISABILITY AND ADVERSE POSSESSION
the statutory period does not begin to run if the true owner was under some disability to sue when the cause of action first occurred.
TYPES OF LEASEHOLDS
A landlord-tenant relationship can result from any one of the following four tenancies: fixed term, periodic, tenancy at will, tenancy at sufferance.
FIXED TERM
(TENANCY FOR YEARS)
an estate with the beginning and the ending dates fixed in advance.

1. Formation – usually created by written leases. Under the Statute of Frauds a writing is required unless the lease is for less than a year.

2. Duration – The duration of the estate may be measured in days, weeks, months, or years.

3. Termination – A tenancy for years automatically at its termination date. Also terminates upon surrender if the tenant relinquishes his/her leasehold interest to the landlord, and the landlord accepts.
PERIODIC TENANCY
is a tenancy for successive periods of time, e.g., year to year, month to month, or until terminated by proper notice by either party.

1. Formation – The parties may expressly contract for a periodic tenancy or one may be implied from a provision for periodic rental payments.

2. Termination - A periodic tenancy may be held over for an indefinite succession of the same period of time as that initially agreed to. Thus, a periodic tenancy does not automatically terminate at the end of any period but renews for the next successive period.
TENANCY AT WILL
The tenancy at will exists for an indefinite period. It is terminable at the will of either landlord or tenant.

1. Formation – A tenancy at will can arise by:
a. express agreement between landlord and tenant
b. unless the tenancy at will arose by express agreement, acceptance by the landlord of regular, periodic rent payments results is a periodic tenancy in many states

2. Termination – Either the landlord or the tenant may terminate the tenancy at any time.
TENANCY AT SUFFERANCE
arises when a tenant wrongfully remains in possession after the expiration of a lawful tenancy and lasts until the landlord takes steps to evict the tenant.
EXPRESS PROVISIONS OF LEASE
Both the tenant and landlord must comply with all provisions contained in the lease.
DUTY TO PAY RENT
tenant has a duty to pay rent as provided for in the lease. If a tenant effectively conveys back (surrenders) his leasehold to the landlord, the tenant’s liability for future rent ends.
DUTY TO REPAIR
Unless the lease provides otherwise, the tenant has no duty to make any substantial repairs, however the tenant must make ordinary repairs to keep the property in the same condition as at the commencement of the lease term. This excludes ordinary wear and tear.
WASTE
Voluntary waste results when a tenant intentionally or negligently damages the premises. A tenant cannot damage or commit waste on the leased premises. A tenant is liable to the landlord for all voluntary waste.
TENANT LIABILITIES UPON MOVING OUT
A tenant must return the premises in the same nature and character as received and is liable for the cost of restoration if it is not.
DUTY NOT TO USE PREMISES FOR ILLEGAL PURPOSES
If the tenant uses the premises for an illegal purpose, and the landlord is not a party to the illegal use, the landlord may terminate the lease and obtain damages and injunctive relief.
EVICTION (UNLAWFUL DETAINER)
If a tenant breaches a duty the landlord may start the Arizona residential eviction process by providing the tenant with a written notice of default called a “five day notice” letter. At a minimum, the five day notice must tell the tenant that the tenant is behind in the rent and that the lease will terminate unless the tenant pays the entire amount due.
DAMAGES
Upon termination of the tenancy, property or money held by the landlord as prepaid rent and security may be applied to the payment of all rent, and subject to a landlord's duty to mitigate, all charges as specified in the signed lease agreement, including the amount of damages which the landlord has suffered by reason of the tenant's breach of duty to repair.
LIEN
If the tenant refuses or fails to pay rent the landlord shall have a lien upon as much personal property as is necessary to secure payment of the rent.

The landlord may sell theproperty if the rent is not paid within sixty days.
LIKE LIEN
When premises are sublet or the lease is assigned, the landlord shall have a like lien against the sublessee or assignee as the landlord has against the tenant and may enforce it in the same manner as a lien.
DUTY TO DELIVER POSSESSION OF PREMISES
the landlord must put the tenant in actual possession of the premises at the beginning of the leasehold term.
COVENANT OF QUIET ENJOYMENT
Every lease has an implied covenant that the property comes free of interference with the tenant’s quiet enjoyment and possession of the premises. This covenant may be breached by:

actual eviction

partial eviction or

constructive eviction.
PARTIAL EVICTION
physical exclusion from part of the premises. Is a breach of Quiet Enjoyment.
CONSTRUCTIVE EVICTION
property rendered uninhabitable. Is a breach of Quiet Enjoyment.
IMPLIED WARRANTY OF HABITABILITY
the landlord must provide a premises suitable to live in.
TENANT REMEDY FOR BREACH OF IMPLIED WARRANTY OF HABITABILITY
the premises must be suitable to live in if it is not the tenant may:

Terminate the lease

Make repairs and offset the cost against future rent

Abate the rent to an amount equal to the fair market value in view of the defects

Remain in possession, pay full rent, and sue for damages
DUTY TO AVOID RETALIATORY EVICTION
A landlord may not retaliate by increasing rent or decreasing services or by threatening to bring an action for possession after:

complaints to a governmental agency

complaints to the landlord

organization of or membership in tenants' union.
ASSIGNMENTS AND SUBLEASES
absent an express restriction in the lease, a tenant may freely transfer a leasehold interest, in whole or in part.
ASSIGNMENT
A complete transfer of the entire remaining term is an assignment. The assignee and tenant are liable to each other for all covenants in the lease that run with the land.
SUBLEASE
if the tenant retains any part of the remaining term (other than a right to reenter upon breach) the transfer is a sublease. A sublease is the tenant of the original lessee and usually pays rent to the original lessee. A sublessee is not personally liable to the landlord for rent or for the performance of any covenants in the main lease unless the sublessee expressly assumes the covenants.
WHAT IF THE ORIGINAL LESSEE DOES NOT PAY RENT
The landlord may terminate the main lease for nonpayment of rent or breach of other covenants if the lease so states of the power is given by statute. Sublease automatically terminates with the main lease.
COVENANTS BETWEEN THE SUBLESSEE AND THE LANDLORD
A sublessee cannot enforce any covenants made by the landlord in the main lease.
COVENANTS AGAINST ASSIGNMENT OR SUBLEASE
Covenants against assignments or subleases are strictly construed against the landlord.
ASSIGNMENT BY LANDLORDS
a landlord may assign the rents and reversion interests he owns. The tenants consent is not required.
LANDLORD LIABILITY FOR LATENT DEFECTS
if at the time the lease is entered into, the landlord knows (or should know) of a dangerous condition that the tenant could not discover by reasonable inspection, the landlord must disclose (not repair) it. Otherwise the landlord will be liable for any injuries resulting from the condition. If tenant accepts after disclosure he assumes the risks.
LANDLORD LIABILITY FOR PUBLIC AREAS
a landlord is liable for injuries to members of the public if, at the time of the lease, he knows (or should know) of a dangerous condition, has reason to believe the tenant may admit the public before repairing the condition; and fails to repair the condition
DUTY TO COMPLETE REPAIRS
although the landlord is not liable for injuries from dangerous conditions arising after the tenant takes possession, if the landlord undertakes such repairs, he owes a duty of reasonable care.
DUTY OF REASONABLE CARE
the landlord also has a general duty of reasonable care toward residential tenants, and will be held liable for injuries resulting from ordinary negligence if he had notice of the defect and had an opportunity to repair.
CONCURRENT OWNERSHIP
An estate in land can be held concurrently by several persons, all of whom have the right enjoyment and possession of the land.
JOINT TENANCY
A joint tenancy's distinguishing feature is the right of survivorship. When one joint dies, the property is freed from her concurrent interest - (her survivors do not succeed it).
CREATION OF A JOINT TENANCY
The common law requires four unities to create a joint tenancy: time, title, interest, possession-; i.e., They must take identical interests, at the same time, by the same-instrument, with the right to possession. Thus, all interests in a joint tenancy must be equal shares. If there are three joint tenants, they each own an undivided one-third interest.
SEVERANCE OF A JOINT TENANCY
under certain circumstances, the right of survivorship is severed (i.e., terminated) and a tenancy in common results.
EFFECT OF ONE JOINT TENANT MURDERING ANOTHER
Conceptually, a joint tenant who murders the other joint tenant should not lose her right of survivorship. In some jurisdictions, statutes change this result; in others, a constructive trust is imposed for the decedent's estate.
TENANCY BY THE ENTIRETY
A tenancy by the entirety is a marital estate akin to joint tenancy. In common law jurisdictions it arises presumptively in any conveyance to a husband and wife. Only death, divorce, mutual agreement, or execution by a joint creditor of both the husband and wife can sever a tenancy by the entirety. An individual spouse cannot conveyor encumber tenancy by the entirety property. A deed or mortgage executed by only one spouse is ineffective.
TENANCY IN COMMON
A tenancy in common is a concurrent estate with no right of survivorship. Tenants can hold different interests in the property, but each is entitled to possession of the whole. Interests are alienable, devisable, and inheritable. Today, multiple grantees are presumed to take as tenants in common, not as joint tenants.
INTER VIVOS CONVEYANCE
a voluntary or involuntary conveyance by a joint tenant of her undivided interest destroys the joint tenancy. The transferee takes as a tenant in common. When there are more than two joint tenants, conveyance by one destroys the joint tenancy only to the extent of the conveyor's interest. Severance may not occur where one joint tenant does not transfer her entire interest.
JUDGMENT LIENS
Usually when a plaintiff obtains a money judgment against a defendant, that judgment becomes a lien on the defendant's real property in the county where the judgment is docketed. The lien runs with the land, burdening it until the judgment is paid or the lien expires (usually 10 years). If such a lien is acquired against a joint tenant, it does not sever the joint tenancy until it is actually sold at a foreclosure sale.
EFFECT OF MORTGAGE ON JOINT TENANCY
In most states, a mortgage is a lien on title and does not sever a joint tenancy. Severance occurs only if the mortgage is foreclosed and the property is sold.
CONTRACT TO CONVEY
Severance results if one joint tenant contracts to convey her interest, but the courts are split on whether an executory contract by all joint tenants works a severance.
TESTAMENTARY DISPOSITION HAS NO EFFECT
A will is ineffective to work a severance because at death the testator's interest vanishes.
CO-TENANT RIGHT OF POSSESSION
Each co-tenant has the right to possess all portions of the property but has no right to exclusive possession of any part. A co-tenant out of possession cannot bring a possessory action unless she is "ousted"
CO-TENANT RIGHT TO RENTS AND PROFITS
In most states, a co-tenant in possession has the right to retain profits from her own use of the property; i. e., she need not share profits with other co-tenants absent ouster or an agreement to the contrary. She must, however, share net rents from third parties and net profits gained from exploitations of land, such as mining.
EFFECT OF ENCUMBERANCES ON A CO-TENANCY
A joint tenant or tenant in common may encumber her interest (e.g., by mortgage or judgment lien), but may not encumber the interests of other co-tenants.
CO-TENANT JUDICIAL PARTITIONS
Any co-tenant has a right to judicial partition, either in kind (physical division of land among co-tenants) or by sale and division of proceeds.

This right may be exercised at any time

Restraints on partition by co-tenants are valid, provided they are limited to a reasonable time.
CO-TENANT DUTY ON IMPROVEMENTS
There is no right of contribution for the cost of improvements unless there is a partition.
CO-TENANT DUTY TO REPAIR
A co-tenant who pays more than her pro rata share of necessary repairs is entitled to contribution from the other co-tenants, provided she has notified the other cotenants of the need for repairs.
CO-TENANT DUTY TO PAY TAXES AND MORTGAGES
Contribution can be demanded for taxes or mortgage payments paid on the entire property. However, reimbursement to a co-tenant in sole possession is limited to the extent that expenditures exceed the rental value of her use.
CO-TENANT DUTY OF FAIR DEALING
A confidential relationship exists among co-tenants; e.g., one co-tenant's acquisition an outstanding title or lien that may affect the estate is deemed to be on behalf of other co-tenants.
EFFECT OF STATUTE OF FRAUDS ON A LAND SALE CONTRACT
A contract must be in writing and contain the signature of the party to be charged and the essential terms (e.g., parties, description of land, price). Part performance (e.g., possession, substantial improvements, payment of purchase price) can take a contract out of the statute.
LAND SALE CONTRACTS AND DOCTRINE OF EQUITABLE CONVERSION
once a contract is signed, equity regards the buyer as the owner of the real property. The seller's interest (the right to the proceeds of sale) is considered personal property. The bare legal title that remains in the seller is considered to be held in trust for the buyer. The right to possession follows the bare legal title, however; thus, the seller is entitled to possession until closing.
MARKETABLE TITLE
Every contract contains an implied warranty that the seller will provide marketable title (title reasonably free from doubt) at closing. It need not be perfect title, but must be free of questions that present an unreasonable risk of litigation.
UNMARKETABLE TITLE
Title may be unmarketable because of a defect in the chain of title (e.g., variation in land description in deeds, defectively executed deed, evidence that a prior grantor lacked capacity to convey).
TIME FOR PERFORMANCE ON A LAND SALE CONTRACT
Courts presume that time is not "of the essence" in real estate contracts. Thus, the closing date is not absolutely binding, and a party late in tendering her own performance can still enforce the contract if she tenders within a reasonable time (e.g., two months) after the closing date.
LAND SALE CONTRACTS TIME IS OF THE ESSENCE WHEN:
the contract so states, ii.
LAND SALE CONTRACTS AND TENDER OF PERFORMANCE
The buyer's obligation to pay and the seller's obligation to convey are concurrent conditions. Thus, neither party is in breach until the other tenders performance (even if the closing date passes). If neither party tenders performance, the closing date is extended until one of them does so.
LAND SALE CONTRACTS AND REPUDIATION
A party need not tender performance if the other party has repudiated the contract or it is impossible.
LAND SALE CONTRACTS REMEDIES
The buyer must notify the seller that his title is unmarketable and give him reasonable time to cure the defects. If the seller fails to cure the defects, the buyer's remedies include rescission, damages, specific performance with abatement, and a quiet title suit. But if closing occurs, the contract and deed merge, and the seller's liability on the implied contractual warranty ends.
WARRANTY OF FITNESS OR QUALITY-NEW CONSTRUCTION ONLY
Contacts of sale and deeds of real property carry no implied warranty of quality or fitness for purpose. However, a majority of courts now recognize a warranty of fitness or quality in the sale of a new house.
SALE OF EXISTING LAND AND BUILDINGS-LIABILITY FOR DEFECTS
The seller of existing buildings (not new construction) may be liable to the purchaser for defects such as a leaky roof, flooding basement, or termite infestation, on any of several different theories:
LAND SALE CONTRACTS AND MISREPRESENTATION AND FRAUD
The seller is liable for defects about which he knowingly or negligently made a false statement of fact to the buyer if the buyer relied on the statement and it materially affected the value of the property.
ACTIVE CONCEALMENT
The seller will be liable for defects, even without making any statements, if he took steps to conceal the defects (e.g., wallpapering over water damage).
FAILURE TO DISCLOSE
Most states hold a seller liable for failure to disclose defects if: (i) he knows or has reason to know of the defect; (ii) the defect is not apparent, and the seller knows the buyer is unlikely to discover it upon ordinary inspection; and (iii) the defect is serious and would probably cause the buyer to reconsider the purchase if known. Factors increasing the likelihood that liability will be imposed in these cases include whether the property is a personal residence, whether the defect is dangerous, and whether the seller created the defect or made a failed attempt to repair it.
CONTRACTOR NEGLIGENCE
A person may sue a builder for negligence in performing a building contract. Some courts permit the ultimate vendee to sue the builder despite lack of privity.
LAND SALE CONTRACTS AND DISCLAIMERS OF LIABILITY
A general disclaimer in the sales contract (e.g., "property sold as is" or "with all defects") is not sufficient to overcome a seller's liability for fraud, concealment, or (in the states that recognize it) failure to disclose. If the disclaimer identifies specific types of defects (e.g., "seller is not liable for any defects in the roof'), it will likely be upheld.
DEEDS
A deed is a legal instrument used to grant a right. The deed is best known as the method of transferring title to real estate from one person to another.
DEED FORMALITIES
a deed must be in writing, be signed by the grantor, and reasonably identify the parties and the land
VOID DEEDS
A void deed will be set aside even if the property passed to a BFP, but a voidable deed will be set aside only if the property has not passed to a BFP.
DESCRIPTION OF LAND IN A DEED
is sufficient if it provides a good lead to the identity of the property.
DELIVERY AND ACCEPTANCE OF A DEED
a deed is not effective unless it has been delivered and accepted. Delivery refers to grantor’s intention to make a deed presently effective even if possession is postponed. Acceptance by a grantee is presumed in most states and dates back to the date the deed was delivered into escrow.
COVENANTS IN DEEDS
A deed may contain any or all of the following present or future covenants: seisen, right to convey, against encumbrances, warranty, quiet enjoyment, further assurances.
PRESENT COVENANTS
Seisen – grantor has right to both title an possession at the time of the grant

Right to convey – has the authority to grant

Against encumbrances – there are no physical or title encumbrances (i.e. mortgages)
FUTURE COVENANTS
Warranty – agrees to defend against reasonable claims of title by a third party

Quiet enjoyment – grantee will not be disturbed in possession by a third party’s lawful claim to title

Further assurances – grantor promises to perform acts reasonably necessary to perfect title conveyed
NOTICE RECORDING
Arizona is a notice recording state. Under a notice statute, a subsequent BFP (person who pays value and has no notice of the prior instrument) prevails over a prior grantee who failed to record. Subsequent BFP is protected against prior grantee regardless of whether they record or not.
PURE RACE STATUTES
Race statutes give priority to whoever records first. In other words, whoever records first wins and actual notice is irrelevant.
RACE-NOTICE
Race-notice statutes give priority to a subsequent bonafide purchaser who had no constructive, inquiry or actual notice of the prior unrecorded interest and was the first to record. In other words, the subsequent bfp wins but must record first and have no notice.
SECURITY INTEREST
A security interest is a property interest created by agreement or by operation of law over assets to secure the performance of an obligation
MORTGAGES
A legal mortgage arises when the assets are conveyed to the secured party as security for the obligations, but subject to a right to have the assets reconveyed when the obligations are performed
DEED OF TRUST
A deed of trust is a lien on property. It is used in place of a mortgage. A deed of trust involves three parties. The trustor, the lender as the beneficiary, and a neutral third party as the trustee. The deed of trust is cancelled when the debt is paid. Until then, the trustee has the power to foreclose if the debt is not paid.
INSTALLMENT LAND CONTRACT
An installment contract for the sale of land whereby the seller (vendor) holds legal title and the buyer (vendee) has equitable title until the sales price is paid in full.
ABSOLUTE DEED OR EQUITABLE MORTGAGE
An equitable mortgage can arise in two different ways - either as a legal mortgage which was never perfected by conveying the underlying assets, or by specifically creating a mortgage as an equitable mortgage.
ACCELERATION CLAUSE
A clause in a mortgage note or contract stating that upon default of a payment due, the balance of the debt or obligation should at once become due and payable.
SALE-LEASEBACK
An arrangement where a person sells property to another but immediately rents it from the purchaser.
FORECLOSURE
A legal proceeding where property used to secure a debt is sold to pay off that debt when the borrower has defaulted on loan payments or broken other terms of the mortgage agreement.
REDEMPTION
At anytime before the foreclosure sale, the mortgagor has the right to redeem the land or free it of the mortgage by paying off the amount due, together with any accrued interest.
PRIORITIES
Generally, the priority of a mortgage is determined by the time it was placed on the property. When a mortgage is foreclosed, the buyer at the sale will take title as it existed when the mortgage was placed on the property. Foreclosure of junior interests will not affect senior interests, the buyer takes subject to the senior interests.
PROCEEDS OF A FORECLOSURE
are used first to pay expenses of the sale, attorneys’ fees and court costs, then pay the principal and accrued interest, next to pay junior liens and other junior interests in order of priority.
TRANSFERS BY MORTGAGOR AND MORTGAGEE
All parties to a mortgage or deed of trust can transfer their interests. The mortgagor transfers by deeding the property. The mortgagee transfers by endorsing the note and executing a separate assignment. The note and mortgage must pass to the same person for the transfer to be complete.
NATURAL RIGHTS
An owner of real property has the exclusive right to use and possess the surface, the airspace, and the soil of the property.
RIGHT IN AIRSPACE
the right to airspace above a parcel is not exclusive, but the owner is entitled to freedom from excessive noise.
LATERAL AND SUBJACENT SUPPORT
Ownership of land includes the right to have the land supported in its natural state by adjoining land. A landowner is strictly liable if his excavation causes adjacent land to subside. In Arizona, notice of excavation must be given to protect against surprise.
WATER RIGHTS
If water comes from underground (is percolating) the riparian or prior appropriation doctrines apply. If the water passes over the land but has no channel it is surface water. Natural flow, common enemy and reasonable use applies.
RIPARIAN DOCTRINE
water belongs to those who own the land bordering the watercourse. Riparian rights attach to all contiguous tracts held by the same owner as long as one abuts the water. This has been abolished in Arizona.
PRIOR APPROPRIATION DOCTRINE
In Arizona, a proposed water user must apply for a permit. The permit will fix the amount allotted. Preference is given to domestic and family purposes over irrigation and stock watering, power and mining, and recreation and wildlife. These rights are transferable.