Week 10 (Law of REAL Property & Mortgages of Land)

Question 1

What is real property

Answer 1

Real property is the legal interests recognized and protected by law
-“bundle of rights or interest in lands”
-land use is public

Question 2

what are the 2 categories of interest in land

Answer 2

1. Estates in time
   -(own something for a specific period)
2. Interests less than Estates
   -(you do not own it completely, right to use but not own)

Question 3

What are the different types of Estate in Time

Answer 3

1. Freehold estates
   -indefinite period, no end date
2. Life estate (indefinite)
   -held for the life of the person; once dead, it goes to someone else
3. Leasehold estates
   -interest in land for a definite time with possession (renting an apartment for a year)
4. Concurrent interests in estates - sharing titles
   -you and someone else both own something together (inheriting house w sibling)
5. Tenancy in common
   -you and someone both own a house but not share it together
6. Joint tenancy
   -own something together, if one person dies the ownership goes to the other person

Question 4

What are the different types of Interests less than estates

Answer 4

1. Easements
   -giving someone permission to use your land for something specific, letting a neighbour walk through YOUR backyard to get to his
   -not for exclusive possession
   A special right to give to someone who owns a piece of land to do something on someone else’s land, like walking through it.

-easement by prescription is easement that is allowed for 20 years, cannot be removed set in stone

2. mutual easement
   -shared driveways between neighbours
3. Right of way
   -type of easement that gives someone the right to travel through your land, letting utility workers access power lines
4. Restrictive covenants
   -set of rules for how a piece of land can be used set by the person who sold it (not allowing buildings over a certain height in a neighbourhood)

Question 5

What are the requirements for right of way easement

Answer 5

1.must be a servient and dominant tenant
2.dominant - the one benefitting from the right of way
3. servient - ‘serves’/allows the crossover

Question 6

what are ways the interests of land can be transferred

Answer 6

1. by sale or gift
2. by expropriation

Question 7

what can a potential purchaser buy

Answer 7

title insurance to cover↓
title in subject land
defect, charge, lien, or other interest
lack of access to property
costs of defending title of property

Question 8

What is adverse possession

Answer 8

Adverse possession is like squatter’s rights. If someone uses land without permission for a long time, and the real owner doesn’t do anything about it, the person using the land can sometimes become the legal owner

basically if someone has been doing work to the land, could take is over

Question 9

Why is adverse possession require 10 years but ease for prescription requires 20 years

Answer 9

Adverse possession is when someone gains ownership of land (GAINS OWNERSHIP)by using it without permission for a long time, and the real owner doesn’t do anything about it.

Easement by prescription (right to use land) is when someone gains the right to use someone else’s land in a specific way (like walking through it) by using it openly and continuously for a long time, without permission, and the real owner doesn’t do anything about it.

Question 10

what does a mortgagor (receives money) promise?

Answer 10

-pay principal, debt, accrued interest, either at maturity or in required instalments
-keep property adequate insurance
-pay taxes on land and buildings
-keep premises in a reasonable state of repair

Question 11

what does mortgagee (lends money)

Answer 11

1.explore necessary discharge of mortgage upon repayment in full
2. leave mortgagor in possession and not interfere with his use and enjoyment of the mortgaged premises so as long as mortgagor observes all covenants

Question 12

what are the remedies for the mortgagee

Answer 12

1.sue mortgagor to repay debt
2. dispossess mortgagor and occupy land itself or sell land
3. to proceed with an action for power of sale or foreclosure

Question 13

what is the power of sale

Answer 13

*Under Sale by the Court and Power of Sale, a mortgagee may arrange to have the land sold and still sue the mortgagor to recover the balance of the debt (deficiency)
-the bank can take ur house and sell it back if you cannot make payment

*After Foreclosure, the mortgagee cannot demand repayment of the remaining debt from the mortgagor (deficiency)

Question 14

what is a foreclosure?

Answer 14

1.mortgagee cannot demand 2.repayment of the remaining debt from the morgagor
3. bank takes the owernship
if there is excess value, bank gets to keep it
4. bank goes to court and asks for a time limit in which mortgagor can redeem

Question 15

what are the rights of the primary mortgagor

Question 16

what is a second mortgage and what are the rights of the second MORTGAGEE (person who gives, bank)

Answer 16

second mortgage is an additional loan you take out on the house
-another way to borrow money

Rights of a Second Mortgagee
-must wait in line for the first mortgage holder
*Ranks behind the first mortgagee
*Interest is in equity of redemption, not legal title
*May foreclose on property
*First mortgagee has first claim on proceeds of sale

Question 17

how can a mortgagees interest in land be transferred↓

Answer 17

1.selling mortgage
2. purchaser of mortgage is bound by usual rules of assignment in contract
3. debtor is not bound by the assignment until receiving notice of it
4. purchaser of mortgage takes the mortgage subject to the equities and the state of the mortgage account between mortgagor and mortgagee

Question 18

what is a reverse mortgage

Answer 18

Where the property is fully paid for, and the owner may give a mortgage and receive lump sum periodic payments from the bank

SOMEONE WOULD DO THIS IF THEY ARE HOUSE-RICH AND CASH POOR

Question 19

Describe the two main classifications of interests in land. Distinguish between freehold and leasehold estates.

Answer 19

The two main classifications of interests in land are “estates in time” (that give someone exclusive possession in land for some period of time) and “interests less than estates” (rights to use land for specific purposes that are not exclusive). A “freehold estate” is for either an infinite time (“fee simple”) or an indefinite time (“life estate”), whereas a “leasehold estate” is for a definite time

Question 20

What are the principal differences between joint tenancy and tenancy in common?

Answer 20

The distinguishing feature is the right of survivorship. Only in a joint
tenancy does the surviving joint tenant automatically receive full title to the property on the death of the other. In a tenancy in common, each owns a half (or designated percentage) share, which can be disposed of independently and forms part of the estate of the tenant in common upon his death

Question 21

Peter Green owned and operated Green’s General Hardware as well as the lands and buildings where he carried on business. His younger brother, John, worked for him as manager, as did his daughter, Susan. Peter died, leaving a will in which he gave the business and real property to John for life, with the remainder to Susan at John’s death. John and Susan could not agree on how to run the business. John wanted to push sales and expansion as quickly as possible; Susan feared that such action would make the business unstable—she preferred to build more slowly, consolidating the gains of the business. The dispute became heated, and John fired Susan. Within a few years the business was in serious financial difficulty. John had allowed several buildings, including a warehouse, to fall into disrepair. Susan sought by court action to force John to keep the buildings in good repair. Should she succeed? Why?
John died and left a will giving his whole estate, including the business and buildings, to his wife. Who is entitled to the business, and why?

Answer 21

This problem concerns the rights and duties or a life tenant (John) and the position of the remainderman (Susan). A life tenant is not required to repair the buildings, unless the instrument creating the life interest imposes on the life tenant in an “obligation to keep the property in a good state of repair”. Since Peter’s will contained no such provision, Susan cannot force John to keep the buildings in good repair. If John undertook repairs, he could not force Susan to contribute to the cost.

Since John holds the “life estate”, his interest in the land ceases automatically upon his death.  He cannot pass on any interest in the land by will or otherwise, and Susan is entitled to it as the remainderman specified in Peter’s Will.   As a practical matter, if the property is to be sold, few purchasers would be interested in purchasing a property subject to a life estate.  However, John and Susan could combine their interests to convey “fee simple” in the land.