Limitations on Property Rights

Question 1

What are the 4 government limitations?

Answer 1

Think P.E.T.E.
P-Police Power: Right of government to limit private use activities when it’s in the publics best interest to do so.
-Zoning: governs land use (residential, commercial, etc.). Dictates purpose, height, lot sizes, etc.
-Building codes: governs how you build
E-Eminent Domain: right of government to force the sale of privately owned property if it is in the public’s best interest to do so. Government will condemn property, pay the owner what it is worth, & take it.
T-Taxes: municipal property taxes.
E-Escheat: Reversionary interest in privately owned property held by the state.
-example: when someone owns property and that person dies without leaving a valid will & no heirs, the government ends up w/ the property.

Question 2

What are the three ways to avoid zoning laws?

Answer 2

1. Non-conforming use: Get grandfathered in.
2. Variance: Special allowance - up to the town.
3. Conditional use permit: A constrained variance (example: you can use the property commercially ONLY is you use it for what the town wants.

Question 3

Certificate of Occupancy (C/O)

Answer 3

Part of building codes.

This proves the property was built up to code & is safe for occupancy.

Question 4

How do un-pulled permits affect the future sale of a property?

Answer 4

Un-pulled permits for improvements can hinder the sale of a property.

Question 5

Municipal Property Taxes

Answer 5

Taxes assessed against your property by the town of city.
Pays for most things the town or city does.
Taxes run w/ the land.

Question 6

What happens when property taxes go unpaid.

Answer 6

Towns can foreclose on the property.
Super priority lien.
There is an “equitable right of redemption”.

Question 7

Equitable Right of Redemption

Answer 7

Town forecloses on your property, but you’re given 1 year (from the date of sale) to pay back the taxes (plus the interest to whoever covered the payment).
-If not paid in 1 year, whoever covered the payment for the year will end up w/ the property.

Question 8

How are tax values decided?

Answer 8

Taxes are charged on the assessed value of the property.

Question 9

How are taxes charged?

Answer 9

Taxes are charged in mills.

$1 per $1,000

Question 10

When are taxes paid?

Answer 10

They are either paid quarterly or semi-annually on a fiscal year from July 1st to June 30th.
(-8/1, 11/1, 2/1, 5/1 - in MA)

Question 11

What are special assessments when it comes to taxes?

Answer 11

Charges for improvements made to your property by the town. (like sewer hookup, street lighting, etc.)

Question 12

What are “special districts” when it comes to taxes?

Answer 12

Tax districts that charge adjacent homeowners for services they receive. (like homes around parks pay more because they benefit from the park)

Question 13

What is the annual property tax on a $100,000 home assessed at 40% with a millage rate of $20 per $1,000?

Answer 13

$100,000 x .4 = $40,000 (assessed value)
$40,000 / $1,000 = 40 (payments)
40 x $20 = $800 tax bill

Question 14

What are the 2 private limitations?

Answer 14

Covenants: contractual limitations in a subdivision.
-Must be uniformly applied to all homeowners (think HOA).
Deed Restrictions: contractual limitations written into your deed.
-Applies to all present and future owners.
-Violation of this could result in loss of property. Property would revert to whoever wrote in the restriction of their heirs.

Question 15

Conflicts between public & private restrictions:

Answer 15

If there is a conflict between private & public restrictions, the more restrictive prevails.

Question 16

CERCLA

Answer 16

Federal environmental law.
Empowers EPA to go after those who contaminate real estate.
Superfund Act is a trust that provides money to the EPA for clean up of contamination.

Question 17

SARA

Answer 17

Federal environmental law.
Amendment of CERCLA-(Superfund Amendments & Reauthorization Act of 1986).
Provides for innocent land owner status; which allows the land owner to say they didn’t know about the contamination & that they will clean it up and not get in trouble for the contamination.

Question 18

MA oil & hazardous release prevention & response Act (21E)

Answer 18

The MA superfund act.
Empowers the Dept. of Environmental Protection to have the same authority as the EPA does in CERCLA; they go after those who contaminate real estate. They also have a “superfund”.
It bands new underground oil tanks.
21E certificate proves that properties are not contaminated.

Question 19

Clean Water Act (CWA)

Answer 19

Federal environmental law.

Law designed to clean up our navigable water ways.

Question 20

National Flood Insurance Program (NFIP)

Answer 20

Federal environmental law.
Designed to provide insurance to properties in high risk flood zones.
Mandatory to have this if the property is in a high risk flood zone & you have a federally backed mortgage.
(Flood zones are covered by FEMA)

Question 21

Wetlands Protection Act

Answer 21

MA law
Protects wetlands (land that is annually or semi-annually wet).
Cannot make any substantial alterations to the wetland & you need to maintain a buffer zone of 100 ft. around the wetland.

Question 22

Endangered Species Act

Answer 22

Federal law
Impacts what you can build.
Protects endangered species.

Question 23

Coastal Zone Management Act (CZMA)

Answer 23

Federal law.

Designates coastal zones that you can’t do much with.

Question 24

LEED Certification

Answer 24

Suit of ratings established by the U.S. Green Builders Council designed to encourage environmentally friendly building.
-If you build a building in an environmentally friendly way, as described by the certification, you get a certain ranking from 1-100. The higher you rank, the more you get in permitting incentives, tax incentives, etc.

Question 25

Accretion

Answer 25

The addition to land by wind or water,

Question 26

Alluvion

Answer 26

Deposit of detrital material by action of water.

Question 27

Alluvium

Answer 27

Detrital material deposited by alluvion (sand, silt).

Question 28

Aeolian Soil

Answer 28

Loose soil deposited by action of wind (sand, gravel, etc.)

Question 29

Avulsion

Answer 29

Sudden removal of land & deposit of it elsewhere by water.

Question 30

Erosion

Answer 30

Gradual removal of land by wind or water.

Question 31

Reliction

Answer 31

Sudden retreat of water, increasing land.

Question 32

Easements

Answer 32

Right of way across another’s property.
Runs w/ the land.
The property w/ the right is the dominant tenement. The land encumbered is the servient tenement.

Question 33

Easement Appurtenant

Answer 33

Concerning 2 adjacent lots of land (where one lot has the right over the other one).

Question 34

What are the 4 ways to create an easement appurtenant?

Answer 34

1. Deed: It is written in the deed.
2. Implication: Where you did not put it in the deed, but you intended to or the situation makes it clear that you meant to.
3. Necessity: Where it is not in the deed, but the easement is necessary for one of the lots of land to be accessible.
4. Prescription: Where you “take” an easement created by ONCHA (Openly Notoriously Continuous Hostile Act) so long as you have been using the easement as such for more than 20 years.

Question 35

Easements in Gross

Answer 35

Personally held easements.
-Example: you sell a property w/ a dock, but you want to continue to use the dock. This allows you to continue to use the dock for the span of your life. It is not inheritable.

Question 36

Encroachment

Answer 36

Similar to easement by prescription for someone’s stuff (like a fence).
Intrusion of an improvement of someone else’s land.
ONCHA >20 years.
Discovered by survey.
The person with the encroachment can end up owning the land that it sits on.

Question 37

What are the two types of liens?

Answer 37

General Liens: covers all property (personal & real).

Specific Liens: covers just one piece of property (usually real estate).

Question 38

Mortgage

Answer 38

Voluntary lien.
Lien for the purpose of securing a real estate loan.
Mortgage is the lien, not the loan, thus:
Mortgagor=Borrower Mortgagee=Bank

Question 39

Installment Sales Contracts

Answer 39

Voluntary lien.
Agree to make payments for property & don’t receive legal title until you make your final payment.
Equitable Title: A future right to acquire legal title.

Question 40

Property Tax Liens

Answer 40

Involuntary lien.

Lien for unpaid property taxes.

Question 41

Federal Tax Liens

Answer 41

Involuntary lien.

General lien for delinquent federal taxes.

Question 42

Estate Tax Lien

Answer 42

Involuntary lien.

A lien against an estate for unpaid taxes.

Question 43

Mechanic’s Lien

Answer 43

Involuntary lien.
A protection for contractors against non-payment.
-Needs to be satisfied before the sale of a property or else the buyer’s bank will not finance.

Question 44

Judgments

Answer 44

Final decision by a court, can result in a sheriff’s sale (sale for a court’s judgement to be satisfied; like a lawsuit).

Question 45

Attachments (in terms of liens)

Answer 45

Legal seizure of a property to satisfy a possible judgement. (Attaches real estate in lawsuit).

Question 46

Lis Pendens

Answer 46

Records notice of attachments in lawsuit.

Question 47

In what order are liens paid?

Answer 47

“first in time-first in right”

Question 48

Tom wants to build a neighborhood pharmacy in an area zoned for residential use. What would most likely be used to obtain permission for this store?

Answer 48

A conditional use permit.

Question 49

A deed restriction is applicable to…

Answer 49

All owners present & future.

Question 50

Escheat occurs when…

Answer 50

A property owner dies without heirs or a valid will.

Question 51

Millage rates are measured in…

Answer 51

$1 per $1,000

Question 52

Emma wants to build a 3 story home on a vacant lot of land she recently purchased. Her town’s zoning bylaws allow for 2.5 story homes, & her housing development CC & R’s allow for up to 3.5 story homes. How tall can Emma build?

Answer 52

2.5 stories.