Real Property (Short)

Front 1

Identify the 3 Interests in Land

Back 1

1. The Estate

2. The Easement

3. The Restrictive Covenant

Front 2

FEE SIMPLE ABSOLUTE (FSA)

Back 2

The FSA is potentially infinite in duration.

FSA must be fully ALIENABLE: No direct restraints on transfer of ownership of FSA. Any attempt to put a direct restrain on alienation is VOID -- which means you ignore the restriction.

Front 3

LIFE ESTATE

Back 3

The life estate may be granted EXPRESSLY or may arise by IMPLICATION.

The life estate is never measured by time--only measured by life.

The MODERN rule ALLOWS a provision that terminates the life estate IF the life tenant attempts to convey away the life estate.

Front 4

LIFE ESTATE PUR AUTRE VIE

Back 4

(A life estate measured by the life of another).

Modern Rule: If the life tenant dies before the measuring life dies, the life estate passes to the estate of the deceased life tenant and continues in place until the measuring life dies.

Front 5

WASTE

Back 5

Life tenant MAINTAINS the estate--this expresses both the maximum and the minimum that the life tenant can do on the land.

Three types of waste:

1. Voluntary waste

2. Permissive waste

3. Ameliorative waste

Front 6

VOLUNTARY WASTE

Back 6

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

Front 7

PERMISSIVE WASTE

Back 7

FAILURE TO MAINTAIN. Tenant must do 3 things to avoid liability for permissive waste:

1) REPAIRS -- Life tenant has an obligation to make ordinary repairs but not replacement.

2) TAXES -- The tenant must pay ALL taxes on the property.

3) MORTGAGE DEBT -- Life tenant must pay the interest on any mortgage indebtedness on the property but is not required to make any principal payments. The holder of the future interest generally must pay the principal.

4) INSURANCE -- Life tenant does NOT have to insure the property. However, the life tenant does have an insurance interest.

Front 8

AMELIORATIVE WASTE

Back 8

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

CAVEAT: If CHANGED CONDITIONS have made the property RELATIVELY WORTHLESS, then the life tenant can alter the property without incurring liability to the holder of the future interest.

Front 9

FUTURE INTERESTS

Back 9

The INTEREST exists now but possession will not take place--if at all--until some time in the future.

Future interests retained by GRANTOR:
1. REVERSION
2. POSSIBILITY OF REVERTER
3. RIGHT OF RE-ENTRY

Future interests given to GRANTEE:
1. REMAINDER
2. EXECUTORY INTEREST

Front 10

REVERSION

Back 10

A reversion in the grantor arises whenever the grantor conveys away LESS than the FULL durational estate that the grantor had.

Ex: O to A for life. A later conveys the property to B.

A has a life estate.
O has a reversion.

Front 11

POSSIBILITY OF REVERTER

Back 11

Whenever the grantor conveys a fee simple determinable (FSD), the grantor automatically retains a possibility of reverter.

MAGIC WORDS:
--so long as
--while
--during
--until

The FSD will determine (or end) AUTOMATICALLY at the occurrence of some event.

Ex: O to A and his heirs for so long as no liquor is consumed on the premises.

A has a FSD.

Front 12

RIGHT OF RE-ENTRY

Back 12

(Power of Termination) Title does not go back to the grantor automatically when the condition is broken; grantor must do something to retake the property.

MAGIC WORDS:
--provided, however
--but if
--on condition that

Ex: O conveys Blackacre 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.

Title then stays in A until the grantor O exercises his right of re-entry.

Front 13

REMAINDER in Grantee

Back 13

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

Remainders are either VESTED or CONTINGENT.

Front 14

VESTED REMAINDER

Back 14

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

Front 15

CONTINGENT REMAINDER

Back 15

If there is a condition that the grantee must satisfy before his interest in the property will become possessory, he will have a contingent remainder.

Ex: O conveys Blackacre to A for life, then to B and his heirs if B survives A.

A: Life estate
B: Remainder in fee simple
O: Reversion

B has a contingent remainder.

Front 16

CLASS GIFTS: Vested Remainder Subject to Open

Back 16

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., the children of A).

Ex: O conveys Blackacre to A for life, then to A's children. At the time O makes this grant, A has three children: B, C, and D.

A has a life estate.
B, C, and D have a vested remainder subject to open. The vested remainder is subject to open to allow for the birth of future siblings.

Front 17

CLASS GIFTS: Rule of Convenience

Back 17

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

Ex: O to A's Children by will. At the time the will is executed, A has two children: B and C. After the will is executed but before O dies, A has another child, D, and B dies. Then O dies. Two year later, A has another child, E.

--The gift to A's children is a class gift.
--B's estate gets nothing. Members of a class who predecease the testator are eliminated.
--C and D take.
--E gets nothing because, under the rule of convenience, the class CLOSES when the testator dies.

Front 18

EXECUTORY INTEREST

Back 18

An executory interest operates to cut short the estate that comes before it.

Ex: O conveys Blackacre to A so long as the property is used for residential purposes; and if the property is ever used for other than residential purposes, then to B and heirs.

--A has a fee simple subject to an executory interest.
--B has an executory interest.

Front 19

The RULE AGAINST PERPETUITIES (RAP)

Back 19

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

PUBLIC POLICY: To promote free transferability of land by preventing remote vesting. We want to make it easy to transfer title to Blackacre.

The RAP ALWAYS applies to executory interests and contingent remainders and vested remainders subject to open. If a future interest violates the RAP, it is VOIDED. So, cross out language of the conveyance that violates the rule.

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

Front 20

JOINT TENANCY (JT)

Back 20

The 4 UNITIES must be persent at the outset in order to create a JT (T-TIP Test):

1. Unity of TIME. All JT interests must have vested at the same time.

2. Unity of TITLE. The grant to all JTs must be the same instrument (e.g., one deed).

3. Unity of INTEREST. All JTs must take the same kind and the same amount of interest.

4. Unity of POSSESSION. All JTs must have identical rights of possession.

General RULE: To create a JT, the language of conveyance must clearly reflect the grantor's INTENT to create a JT.

Under the Majority Rule today, certain magic words must be used:
--"as joint tenants, with right of survivorship" or "in joint tenancy with right of survivorship."

The JT carries a RIGHT OF SURVIVORSHIP. The surviving tenants take automatically on the death of a JT.

Front 21

TENANCY IN COMMON (TIC)

Back 21

NO unities are required EXCEPT one: Unity of POSSESSION, which means that each co-tenant is entitled to possess the whole of the property.

MODERN presumption is to favor the TIC. TIC is the DEFAULT tenancy. So, if a JT is not properly created, then it results in a TIC.

This estate is FREELY ALIENABLE (meaning, each co-tenant may do what they want with it, like sell their half, mortgage their half, give it away, etc.).

Any TIC can force a partition.

In a TIC, there is no right of survivorship.

Front 22

TENANCY BY THE ENTIRETY (TBE)

Back 22

Requires the four unities, PLUS the unity of MARRIAGE.

At CL, any grant of a concurrent estate to a Husband and Wife would give rise to a TBE provided the four unities were present.

NOTE: This is only tested on the MBE because CA is a CP jxn!!

TBE has a right of survivorship.

But, no right of partition.

Termination can be by:
1. Death
2. Mutual agreement in writing
3. Divorce
4. Execution by a joint creditor

Front 23

LL-TENANT ESTATES (Non-Freehold Estates)

Back 23

The FOUR Landlord-Tenant Estates are:

1. Estate for Years (or Tenancy for Years)

2. Periodic Tenancy

3. Tenancy at Will

4. Tenancy at Sufferance

Front 24

Tenancy for Years

Back 24

Key phrase is "specified time."

Must specify two dates: a definite beginning and ending date.

The estate is measured by a FIXED period of time--no matter how short.

BUT, also remember that the Statute of Frauds (SOF) requires that any tenancy for years for over 1 year be in writing.

KEY ELEMENT: NO NOTICE is required between landlord and tenant to terminate a tenancy for years.

Front 25

Periodic Tenancy

Back 25

Key phrase is "repeating."

The estate rolls on and on--until one party gives proper notice.

CREATION:

a. By express agreement

b. By implication: No agreement to duration

c. By operation of law:
1. Oral lease that violates SOF
2. Holdover tenant

A periodic tenancy MUST BE TERMINATED BY GIVING PROPER NOTICE.

Front 26

Tenancy at Will

Back 26

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

Termination by operation of law:
--death of either party
--waste by the tenant
--assignment by the tenant
--transfer of title by LL
--Lease by the LL to 3rd party

Front 27

Tenancy at Sufferance: The Holdover Tenant

Back 27

This type of tenancy refers to the bare POSSESSION that a tenant has of the property when the tenant wrongfully holds over.

LL's options:

1. Sue to evict (sue in trespass and to recover damages for the holdover).

2. Impose a new periodic tenancy.

RAISED RENT: If the LL gives the T notice of the increase in rent BEFORE the expiration of the lease, then the LL may properly demand payment of the higher rent amount if the tenant holds over.

Front 28

DUTIES OF THE TENANT

Back 28

1. DUTY TO PAY RENT

2. DUTY TO MAINTAIN PREMISES

If the lease is silent, the T is still subject to the CL duty not to commit waste.

If the lease includes a covenant to repair, an express covenant makes the tenant the absolute insurer of the property. The MAJORITY view is that once the tenant covenants to repair, he is liable for EVERYTHING--including ordinary wear and tear. BUT, if the premises are destroyed without the tenant's fault, the tenant will be under no duty to rebuild the structure.

3. DUTY not to use the premises for ILLEGAL PURPOSES

4. DUTY NOT TO ABANDON THE PREMISES

Front 29

DUTIES OF THE LANDLORD

Back 29

1. DUTY TO DELIVER POSSESSION OF THE LEASED PREMISES

2. IMPLIED WARRANTY OF HABITABILITY

At CL, there was NO DUTY to deliver the leased premises in habitable condition. Today, there exists an implied warranty of habitability, but ONLY FOR RESIDENTIAL PROPERTIES.

3. IMPLIED COVENANT OF QUIET ENJOYMENT

Front 30

Tenant's Remedies for Breach of Implied Warranty of Habitability

Back 30

1) Tenant can move out AND end the lease (w/ no further lease obligation). OR

2) Tenant can stay on the property AND sue for damages.

3) A growing number of states also allow the T to make reasonable repairs and deduct this cost from future rent payments ("repair and deduct")

Front 31

Implied Covenant of Quiet Enjoyment

Back 31

Every lease includes the LL's implied promise not to interfere with the tenant's QUIET ENJOYMENT of the leased premises.

This implied promise is included in EVERY lease--residential, commercial, or otherwise.

The LL may breach this implied promise in 3 ways:

1) TOTAL EVICTION
2) PARTIAL EVICTION
3) CONSTRUCTIVE EVICTION

Front 32

TOTAL EVICTION

Back 32

Physically excluding the tenant from the premises (e.g., changing the locks). Lease is then over.

Front 33

PARTIAL EVICTION

Back 33

Partial eviction occurs where the LL physically excludes the tenant from only some portion of the leased property.

Ex: LL comes to the property and changes the lock to the basement, saying he needs to store some stuff there. What can the tenant do? Stay on what's left in the lease AND stay for free! But, be careful if the partial eviction is by a 3rd party (if so, the rent is proportionally reduced to reflect the amount taken).

Front 34

CONSTRUCTIVE EVICTION

Back 34

A constructive breach occurs where the LL fails to provide some service that the LL is obligated to provide AND that failure makes the property UNINHABITABLE.

3 requirements:

1. It must be the LL's failure to provide some service, not some 3rd party's failure.

2. There must be a SUBSTANTIAL interference with the tenant's quiet enjoyment of the property (e.g., LOTS of cockroaches, not just one).

3. Tenant must abandon the premises within a REASONABLE TIME after the breach.

Front 35

Tort Liability of Landlord

Back 35

General CL RULE: NO duty imposed on the LL.

FIVE EXCEPTIONS:

1. LATENT DEFECTS

2. SHORT TERM LEASE of furnished dwelling

3. COMMON AREAS (aka "common passageways under LL's control)

4. NEGLIGENT REPAIRS undertaken by LL

5. PUBLIC USE EXCEPTION.

Front 36

FIXTURES: Four Factors of Determining Intent

Back 36

1) DEGREE OF ATTACHMENT

2) GENERAL CUSTOM

3) DEGREE OF HARM TO PREMISES ON REMOVAL

4) TRADE FIXTURES -- Trade fixtures are NOT considered fixtures and can ALWAYS be removed.

Front 37

EASEMENT

Back 37

An easement is a NON-POSSESSORY interest in land involving a RIGHT to USE the land.

1st step is to CLASSIFY the easement:

--easement appurtenant
--easements in gross

2nd step is to specify METHOD OF CREATION

Front 38

Easement Appurtenant

Back 38

Any time the easement DIRECTLY BENEFITS the USE and enjoyment of a SPECIFIC PARCEL of land, it is classified as an easement appurtenant.

The BURDENED PROPERTY is the SERVIENT ESTATE.

The BENEFITED PROPERTY is the DOMINANT ESTATE.

Front 39

Easement in Gross

Back 39

An easement in gross occurs where there is NO DOMINANT estate because there is only ONE PARCEL of land involved, which is the property BURDENED by the easement--or the servient estate.

Front 40

Easement Creation: EXPRESS EASEMENT

Back 40

Express easement arises from:

a) express grant of an easement to someone else;

b) express reservation of an easement when the land is sold to another person.

An EXPRESS easement must:

1) be in WRITING;
2) be signed by the holder of the servient estate; and
3) satisfy all the deed formalities.

NOTE: Easements of less than 1 yr do not have to be in writing.

Front 41

Easement Creation: IMPLIED EASEMENT

Back 41

Implied easements arise in 2 situations:

1) Previous use by common grantor:

There must be a previous use by a common owner and this previous use must be: (a) apparent; (b) continuous; and (c) reasonably necessary.

2) Absolute right of access rule:

If a person is landlocked, they have an absolute right to an easement, but the owner of the servient estate may choose the location as long as it is a reasonable choice)

Front 42

Easement Creation: EASEMENT BY PRESCRIPTION

Back 42

Easements by prescription are like title by adverse possession. There are FOUR requirements:

1) Use must be ADVERSE to the true owner;

2) Use must be CONTINUOUS and UNINTERRUPTED and must last for the specified statutory period (20 yrs at CL; be careful for seasonal use--OK);

3) Use is visible and notorious or made with the owner's knowledge; and

4) Use is without the owner's permission AND remember--Oral permission is enough to destroy the hostility needed to establish a prescriptive easement.

Front 43

Scope of the EASEMENT

Back 43

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

Where an easement is SILENT, there are TWO PRESUMPTIONS:

1) Unless otherwise specified, an easement is presumed to be perpetual in duration.

2) The use presumed is that of REASONABLE DEVELOPMENT of the dominant estate.

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

REMEDY for excessive use: ENJOIN the use but do not terminate the easement.

Front 44

Termination of an Easement

Back 44

An easement may end by reason of its own terms.

1. DOCTRINE OF MERGER (whenever the dominant and the servient estates come together in the same owner, the easement is automatically terminated).

2. DEED OF RELEASE (must be in writing and satisfy SOF)

3. ABANDONMENT BY ACTION (Mere non-use does NOT constitute abandonment, but you can abandon through action).

4. TERMINATION BY ESTOPPEL (requires a representation of relinquishment by the holder and the holder of the servient estate must make a change in her position in reliance on that representation).

5. TERMINATION BY PRESCRIPTION (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 45

LICENSE

Back 45

A license is a limited privilege to USE the land in the possession of the licensor. A license is not a property interest; it is a CONTRACT right.

A license can ALWAYS be revoked at will by the licensor.

TICKETS are always licenses (no property right).

If an easement is attempted but fails due to the statute of frauds, a LICENSE is created.

Front 46

PROFITS

Back 46

A profit gives the right to go onto the land of another and take away a natural resource.

Along with the profit goes the IMPLIED EASEMENT to go onto the land to remove the natural resource.

Front 47

RESTRICTIVE COVENANT

Back 47

A restrictive covenant gives the holder of the interest the right to RESTRICT some third party in the USE of his or her land.

Restrictive covenants are either:

a) COVENANTS (promises) running with the land; and

b) EQUITABLE SERVITUDES.

BOTH involve a WRITTEN PROMISE that imposes restriction on the use of land. The only DIFFERENCE is the theory used to enforce the terms of the restriction.

Front 48

4 Requirements to Enforce a RESTRICTIVE COVENANT

Back 48

1) INTENT -- The parties must intend that the restriction run with the land.

2) NOTICE -- The person must have either actual, constructive or inquiry notice.

3) TOUCH AND CONCERN -- (RULE) If the performance of the covenant makes that land more valuable or more useful, the covenant touches and concerns the land. NOTE: covenants not to compete DO touch and concern the land.

4) PRIVITY -- Horizontal and Vertical.

Front 49

Determining PRIVITY in a RESTRICTIVE COVENANT

Back 49

BURDEN: Successor-in-Interest is the DEFENDANT--requires both:

a) VERTICAL PRIVITY -- refers to those who subsequently obtain the property subject to the covenant. They must take the FULL ESTATE.

b) HORIZONTAL PRIVITY -- refers to the original parties to the peromise. They must share some interest in the land independent of the covenant. To establish horizontal privity, there must be a conveyance of the property between the original properties.

BENEFIT: Successor-in-Interest is PLAINTIFF:

a) VERTICAL PRIVITY -- On the benefit side, the general rule is that the holder of any succeeding possessory estate may enforce the benefit of the promise as a covenant at law.

2) NO horizontal privity is required to enforce the benefit of a restrictive covenant.

Front 50

EQUITABLE SERVITUDES: 3 Requirements to Obtain an INJUNCTION to Enforce the Burden of the Promise

Back 50

1) INTENT that the restriction be enforceable by successors-in-interest;

2) The restriction must TOUCH and CONCERN the land;

3) NOTICE to the subsequent purchaser (actual, constructive, or inquiry).

NO PRIVITY of any kind is required to enforce the promise in equity as an equitable servitude.

Front 51

EQUITABLE SERVITUDES: Requirements to Establish a Mutual Right of Enforcement

Back 51

1. An INTENT to impose a SERVITUDE (a restriction on use) on ALL land in the subdivision;

2. NOTICE (actual, constructive, or inquiry);

DEFENSES:

1. Unclean hands
2. Acquiescence
3. Laches
4. Estoppel

Front 52

ADVERSE POSSESSION

Back 52

Six Requirements: H-E-L-U-V-A

1. HOSTILE (X is on the land with no right to be there)

2. EXCLUSIVE (X must be excluding others from possessing the property)

3. LASTING (The possession must last for the statutory period; CL is 20 yrs)

4. UNINTERRUPTED USE (continuous use that an ordinary owner would make)

5. VISIBLE (open + notorious)

6. ACTUAL [POSSESSION] (X must actually possess the land to obtain title.

--The true owner DOES NOT have to know what's going on.

--The adverse possessor (X) DOES NOT have to think he owns it (GF/bad faith is irrelevant).

Front 53

Constructive ADVERSE POSSESSION

Back 53

The Doctrine of Constructive Adverse Possession 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.

LIMITATIONS:

1) the amount of land actually possessed must bear a REASONABLE relation to the whole.

2) the property must be UNITARY, which means that the land is a seamless whole (i.e., no highway splitting it in two).

LEASED LAND constitutes possession for purposes of Adverse Possession.

Front 54

CONVEYANCING: Requirements under the Statute of Frauds

Back 54

Any contract for the 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. A description of the property;

2. Names of the parties; and

3. The PRICE to be paid.

EXCEPTION: Doctrine of Part Performance.

Front 55

MARKETABLE TITLE

Back 55

Every land sale contract contains an IMPLIED WARRANTY that the seller will deliver MARKETABLE TITLE to the buyer at close of escrow.

Marketable title is title that a reasonably prudent buyer would accept, which means that MINOR defects do not matter (e.g., land is 6" off; not 6 feet)

To satisfy this warranty the seller must provide buyer with 3 things:

1) Proof of Title

2) Title Free of Encumbrances (e.g., no easements, no restrictive covenants, no mortgages, no options, etc.)

3) Valid Legal Title on Day of Closing.

Front 56

2 Requirements for a Deed to Pass

Back 56

1. EXECUTION:

--Deed is subject to the SOF, and therefore must be in writing and signed by the SELLER (but not the buyer)

--the deed must DESCRIBE THE LAND with sufficient accuracy (otherwise it will be void for vagueness)

2. DELIVERY:

--The legal test for delivery is solely a question of whether the Grantor had the necessary INTENT to pass title. NO PHYSICAL TRANSFER is required.

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

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

Front 57

PRESENT and FUTURE COVENANTS

Back 57

PRESENT:

1. Covenant of Seisin
2. Covenant of Right to Convey
3. Covenant Against Encumbrances

FUTURE:

1. Covenant of Quiet Enjoyment
2. Covenant of Warranty
3. Covenant of Further Assurances--The "Mop-Up" Covenant

BREACH of a Covenant of Title:
Where there is a breach of warranty, plaintiff's damages will be limited to the amount of purchase price received by the warrantor plus any incidental damages.

Front 58

Subsequent Sale to a Bona Fide Purchaser for Value (BFP)

Back 58

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 (which gives the Grantor an implied covenant that the title will be conveyed to the Grantee).

Front 59

Types of RECORDING STATUTES

Back 59

There are 3 types of RECORDING STATUES:

1. NOTICE STATUTE

2. RACE STATUTE

3. RACE-NOTICE STATUTE

Front 60

Bona Fide Purchaser (BFP)

Back 60

A BFP is a bona fide purchaser for value who takes wthout notice.

Unless there is an explicit claim of fraud, any consideration that is OUT OF POCKET is enough to be considered VALUE.

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

One who purports to take property as an heir, devisee, or donee cannot be a BFP (because they have not given anything out-of-pocket).

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