Barbri Real Property MC Review

Question 1

Two partners bought a commercial building from an owner. They paid cash for the building and took title as joint tenants with right of survivorship. Several years later, the first partner executed a mortgage on the building to secure a personal loan to a bank. The second partner had no knowledge of the mortgage to the bank. The state in which the commercial building is located recognizes the lien theory of mortgages. The first partner died before paying off his loan. He left all of his property by will to his daughter, his only heir.

Who has title to the commercial building?

Answer 1

The second partner has title free and clear of the mortgage.

In a joint tenancy with right of survivorship, when one owner dies, their share goes automatically to the surviving owner.

The surviving partner isn’t responsible for the mortgage, since she didn’t sign it.

The state follows the “lien theory”, which means taking out a mortgage does not break (sever) the joint tenancy.

Question 2

A landowner conveyed her parcel of land to “my brother and my sister jointly, with right of survivorship.” Shortly thereafter, the brother was in an automobile accident. The driver of the other vehicle sued the brother on a theory of negligence, and obtained a judgment in the amount of $250,000. Because the brother did not have insurance or enough cash to satisfy the judgment, the driver levied on the brother’s interest in the land.

What interest will the driver most likely take?

Answer 2

An undivided one-half interest, regardless of whether the brother and the sister’s title to the land is construed as a joint tenancy or a tenancy in common.

A person (like the driver here) who gets a lien on someone’s share in property owned jointly still ends up with a half-interest in the land, no matter how the original owners (the brother and sister) held the title.

Joint tenancy means both owners share the property equally and if one dies, the other automatically gets everything.

Tenancy in common also means equal ownership, but no automatic inheritance—each person’s share can go to someone else when they die.

In this case, the document giving the brother and sister the land says “right of survivorship,” which usually means joint tenancy.

Whether it’s a joint tenancy or tenancy in common, the driver can claim an undivided half-interest in the land through foreclosure. The other half remains with the other original owner, unless the property is formally divided (partitioned).

Question 3

A landlord leased an apartment to a tenant for five years. The lease provided that the landlord will: (i) keep the apartment building at a comfortable temperature 24 hours per day, and (ii) have the carpets cleaned once a year. Two years later, the landlord began turning off the air conditioning at 10 p.m. The tenant’s apartment became hot and stuffy, and she demanded that the landlord honor the covenant. The landlord refused. The following month, the pipes burst in the tenant’s only bathroom, rendering it unusable. The resultant flooding soiled some of the carpeting, which had not been cleaned in the past 12 months. The tenant reported the problems to the landlord, who did not return the tenant’s phone calls.

Which of the following will entitle the tenant to terminate the lease?

Answer 3

Only that the landlord did not fix the bathroom pipes (makes place uninhabitable).

Had the tenant terminated the lease and claimed constructive eviction, he could’ve cited the soiled carpets and lack of 24/7 a/c, but he remained in possession.

Question 4

A man had rented a woman’s home from her for seven years. When the time came to sign a new lease, the woman decided that because the man had always been a quiet tenant, she would continue to charge him only $350 per month rent instead of the $500 to $550 she could probably get otherwise. The new lease was for a period of five years, and by its terms, the man was specifically prohibited from assigning the lease without the woman’s specific written consent. About a year later, the man got married and moved into his new wife’s home. Instead of giving up his lease, the man sublet the property to a friend for $500 a month. The man did not get the woman’s permission to sublease the property.

If the woman brings an action to either eject the friend from the premises or to recover damages from the man for subletting the premises without her consent, what is the most likely result?

Answer 4

The woman will have no cause of action for either ejectment or damages.

restraints on alienation strictly construed — covenant prohibiting assignment doesn’t prohibit subleasing & vice versa

So, LL’s prohibition against assignment doesn’t prohibit subleasing

*LL’s can terminate a lease under lease terms or statute, if they have a legit prohibition against transfers in lease

Question 5

A high-volume pleasure-boat retailer entered into a written contract to sell a customer a power boat for $120,000. The retailer could obtain from the manufacturer, for $90,500, as many of these boats as it could sell. As the contract provided, the customer paid the retailer $40,000 in advance and promised to pay the full balance on delivery of the boat. The contract contained no provision for liquidated damages. Prior to the agreed delivery date, the customer notified the retailer that he would be financially unable to conclude the purchase; the retailer thereafter resold the boat that the customer had ordered to a third person for $120,000 cash.

If the customer sues the retailer for restitution of the $40,000 advance payment, which of the following should the court decide?

Answer 5

The customer’s claim should be upheld in the amount of $40,000 minus the amount of the retailer’s lost profit under its contract with the customer.

correct measure of damages is lost profits of the retailer.

When the seller is a dealer and the traditional measure of damages is inadequate to put him in as good a position as he would be in if the sale went through, then the measure of damages is lost profit. Here, since the dealer could have ordered as many boats as there were buyers, he actually lost his profit on this sale.

Question 6

A mass marketer contracted with a political campaign to send out mass mailings to voters for $100,000. It subcontracted with a printer to print brochures for $20,000 over a period of several weeks. The printer would be paid on a weekly basis. After providing $15,000 of printing services the first few weeks, the printer unjustifiably refused to perform any additional work for the marketer. The marketer had paid the printer $10,000 to that point, and had to pay another printer $12,000 to print the balance of the brochures. The marketer sued the printer for breach of contract, and the printer counterclaimed for the reasonable value of the benefits conferred on the marketer and not paid.

What will be the outcome of this litigation?

Answer 6

The marketer should recover $2,000, the excess it had to pay over the contract price to get the performance the printer had promised.

The normal measure of damages is expectation damages.

The marketer has a legally enforceable right to have the work under the printer contract performed for $20,000.

Because the marketer paid the printer $10,000 and needed to spend $12,000 to have the printing completed by a third party, the marketer has spent $22,000. This establishes the marketer’s right to seek $2,000 from the printer for its breach.

Question 7

A golf pro entered into an employment contract with a country club to be its golf pro. The agreement specified that the golf pro would run the pro shop and provide private instruction to members from April through September of each year for the next five years, at a monthly salary of $5,000, plus instructional fees. During those months, the club’s other instructor was playing on the professional tour and was unavailable.

On March 15, the club’s manager received an e-mail from the golf pro, stating: “Made the final cut in Sarasota Winter Open. May not be able to get to club by April 1. Could be delayed until 5th if playoff necessary.” The club’s manager asked his attorney whether he should bring an immediate action against the golf pro for breach of contract.

Which of the following is the most accurate advice for the manager?

Answer 7

Do not file suit; the golf pro has not repudiated the contract.

*this is a fav MBE Q

*NOT anticipatory repudiation — prospective inability to perform

Language may constitute an expression of doubt as to one’s ability to perform under the contract without being an outright refusal.

If the fact pattern language amounts to a prospective inability to perform, the innocent party may suspend performance until he receives adequate assurances that performance will be forthcoming.

Here, the golf pro’s e-mail does not constitute an anticipatory repudiation because he merely states that he “may not” get to the club by April 1

Question 8

A dealer in oriental rugs acquired an antique rug measuring 24 feet by 36 feet. A banker inspected the rug and orally agreed to buy it for the asking price of $65,000, provided he was successful in purchasing the house he was trying to buy, because it had a living room large enough to accommodate the rug. The sale agreement was later reduced to writing, but the provision concerning the purchase of the house was not included in the written agreement.

If the banker is unsuccessful in acquiring the house he wants because the owner decided not to sell, and the dealer sues the banker for the purchase price, what is the most likely result?

Answer 8

The banker will prevail because he was unable to acquire the house he wanted.

parol evidence rule exception: parol evidence is admissible to show a condition precedent to the existence of a contract

contract btwn bank and dealer for sale and purchase of rug was only effective if banker got house he wanted —> banker can show this even tho it wasn’t reduced to writing (condition precedent to to a written agreement’s enforceability may be shown by parol evidence)

Question 9

A gourmet food company entered into a long-term contract with an airline, under which the food company would supply the airline with 5 million gourmet dinners over a five-year period at a special rate of $2 per unit. The food company insisted as a term of the contract that the airline agree to purchase from a microwave supplier, and to install in each of its planes, a microwave oven specifically designed to heat frozen dinners, in part because the food company owned considerable stock in the microwave supplier. The contract between the food company and the airline had a clause that authorized “oral modifications by the contracting parties.”

One month after the contract was signed but before any dinners were delivered, the airline informed the food company that it would have difficulty complying with the provision requiring purchase of the supplier’s microwaves because the supplier’s products had increased dramatically in price. Subsequent negotiations between the food company and the airline led to an oral agreement to increase the price per dinner to $2.08 per unit and eliminate the supplier’s microwave requirement.

If the supplier sues the airline for enforcement of the contract, what will be the most likely result?

Answer 9

Judgment for the airline, because the supplier’s rights had not vested when the modification took place.

*this is fav MBE Q

rights of 3rd party beneficiary don’t vest until: 1.) manifests assent (in manner parties invite/request), 2.) learns of contract & detrimentally relies on it, 3.) brings lawsuit to enforce its rights.

until 3rd party’s rights have vested, modification of the contract can take place w/o consent of the 3rd party.

supplier didn’t bring suit on the contract before it was modified (or detrimentally relied, or assented to contract), so its rights hadn’t vested —> contracting parties free to modify contract

oral mod will be enforceable btwn food company & airline ONLY if SoF exception applies (eg, parties admit mod or perform contract as modified), but a court probz wouldn’t allow supplier to use SoF to prevent parties from admitting their modification

Question 10

A catering company entered into a written contract with a dish supplier to purchase 5,000 plastic dishes at $.10 per dish. The contract called for the supplier to deliver the 5,000 dishes to the caterer on or before October 1. On October 1, the supplier delivered only 3,000 dishes to the caterer. The supplier informed the caterer that it was experiencing manufacturing delays and would deliver the other 2,000 dishes by October 31 at the latest. The caterer accepted delivery of the 3,000 dishes, but because it had a number of catering jobs lined up for early October, the caterer was forced to purchase 2,000 dishes from another supplier at a price of $.12 per dish. The supplier demanded that the caterer pay $300 for the 3,000 dishes delivered, but the caterer refused to pay anything.

If the supplier sues the caterer for breach of contract, what will the supplier recover?

Answer 10

$260, the price under the contract for the 3,000 dishes that were delivered less $40, which is the extra cost incurred by the caterer to obtain the balance of the dishes.

Art 2, UCC — goods fail conformity to contract, buyer may accept goods and pay contract price for goods accepted, BUT buyer has right to offset its damages

buyer can “cover” (UCC 2-712) by making reasonable purchase of substitute goods & then recover as damages difference btwn contract price & “cover” price (2000x.02=40)

Buyer can still sue even if it accepts goods (doesn’t have to expressly reserve its rights)

Question 11

A parks and recreation association placed an order for 100 12-inch softballs with a softball manufacturer. The order stated that the association would pay the current market price for the softballs and requested prompt shipment. The manufacturer promptly shipped 100 16-inch softballs to the association because the manufacturer’s shipping director negligently misread the size listed on the shipping instructions.

Which of the following best describes the association’s rights and duties upon arrival of the 16-inch softballs?

Answer 11

A contract was formed by the manufacturer’s prompt shipment of the 16-inch softballs, but the association is not required to accept the softballs and may sue the manufacturer for its damages.

Art 2, UCC applies
-contract is created by shipment of either conforming or nonconforming goods

shipment constitutes acceptance, not counteroffer & where a buyer rejects nonconforming tender, they’re under no obligation to reship goods to seller

they can reject nonconforming goods & sue for damages OR accept shipment, notify seller of breach, pay contract price, and seek damages even after accepting nonconforming goods

Question 12

The proprietor of a men’s shop contracted on May 1 with a wholesaler of shirts to buy 300 men’s long-sleeve white cotton shirts for $4 per shirt, or $1,200. The parties each signed a purchase order calling for delivery of the shirts to the proprietor’s place of business and payment of the purchase price on July 1. Two days later, the wholesaler discovered that he had made a mistake in his price quote. He told the proprietor that, unless the proprietor paid him $8 per shirt, or a total price of $2,400, he would not be able to deliver the shirts. The proprietor refused to pay anything more than $1,200. When the wholesaler failed to deliver the shirts on July 1, the proprietor purchased 300 comparable shirts for $8 per shirt and brought suit against the wholesaler for damages.

What is the likely result of this lawsuit?

Answer 12

The wholesaler will prevail if the proprietor had reason to know on May 1 that the wholesaler made a mistake in quoting the price of $4 per shirt.

Where one party makes a unilateral mistake about a basic assumption on which the contract is based, and the other party knew or had reason to know of the mistake, the mistaken party will be allowed to rescind the contract

there is a substantial disparity between the contract price of $4 per shirt and the market value of the shirts at wholesale, which seems to be $8 per shirt. If the proprietor, because of the disparity in price, was or should have been aware that the wholesaler had made a mistake, the wholesaler will be able to rescind the contract and therefore will prevail.

***Making a unilateral mistake alone, however, is not sufficient to allow the mistaken party to rescind the contract.
- A contract can be rescinded for unilateral mistake ONLY when the other party knew of the mistake or when the mistake was so obvious that the other party should have known that the first party made a mistake

Question 13

A large producer of bread wrote to a distributor of flour, asking, “How much will you charge to supply my needs for flour for the next year?” The distributor replied in writing that it could supply the producer with all the flour it would need next year at a specified price per pound. The producer wrote back, “Your offer to supply me with flour is hereby accepted, provided that you agree to a 10% discount if payment is made within 10 days from date of billing.”

What should the producer’s reply concerning a 10% discount be characterized as?

Answer 13

A rejection of the distributor’s offer.

Battle of forms.

The producer’s reply is a conditional acceptance, which is a rejection of the offer.

an acceptance containing additional or different terms is effective unless the offeree expressly makes his acceptance conditional on assent by the offeror to the additional terms. When an acceptance is made expressly conditional on the acceptance of new terms, it is a rejection of the offer.

The conditional acceptance is essentially a new offer, and the original offeror may form a contract by expressly assenting to the new terms.

Question 14

After a difficult divorce, a mother wrote to her son and daughter the following:

“In consideration of your emotional support for me during that trying time and your love and affection for me, I promise to divide my estate between you in equal shares. You know you can count on your mother’s word.”

The daughter thereafter continued her usual practice of calling her mother once a week and visiting her at Christmas and on her birthday until her mother died three years later. Shortly after the funeral, the daughter learned that the mother’s will made the son the sole legatee.

If the daughter sues the executor of the mother’s estate for one-half of that estate, based on the mother’s letter to her, will she win?

Answer 14

No, because the mother’s promise was not supported by consideration.

The daughter will lose because there is no consideration to support the promise. Promises to make gifts in the future are unenforceable even if they are in writing and are intended by the promisor to be enforceable

the emotional support given to the mother by her daughter was not bargained-for consideration. It was voluntarily given before there was any promise to leave property by will, and therefore does not make the promise enforceable. In order to be part of the bargain, the element of consideration must be part of the bargained-for exchange. Thus, if the mother had said to her daughter, “If you will give me emotional support, I will leave you half my estate,” the emotional support thereafter given by the daughter would have been bargained for by the mother in exchange for part of her estate. Because the daughter gave her support gratuitously before the promise, the mother’s promise did not induce the legal detriment, and was therefore not supported by consideration.

Question 15

On September 1, an art collector offered to sell one of his expensive paintings to a buyer. The buyer, who was a friend of the collector, wanted a few days to make up her mind, so the collector and the buyer decided that the collector would keep his offer to her open until September 8 in exchange for a payment of $5. Later that week an art investor tendered to the collector double what he was asking for the painting. On the morning of September 8, the buyer telephoned the collector to tell him that she wanted the painting but his phone was out of order, so she wrote out a check for the agreed-on amount and dropped it into a mailbox before leaving town. On September 9 the collector, not having heard from the buyer, sold the painting to the investor.

Who is entitled to the painting?

Answer 15

The investor, because the collector sold the painting to the investor on September 9 before receiving the buyer’s check.

mailbox rule doesn’t apply to option contracts, so acceptance IS NOT effective on dispatch.

no acceptance during time period, so offer lapses.

Question 16

For the first two years of the contract, the microbrewery placed its orders on the first of each month for either four or five barrels of barley. At the beginning of the third year of the contract, an article about the microbrewery appeared in a national newspaper, causing its popularity to soar. The following month, the microbrewery placed an order for 20 barrels of barley. The farm could not meet the increased demand and refused to deliver the 20 barrels. The microbrewery sued the farm for breach of contract.

Will the microbrewery be successful in its suit?

Answer 16

No, because its order for 20 barrels of barley was unreasonably disproportionate to its previous orders over a two-year period.

UCC, quantities subject to requirements contracts may not be unreasonably disproportionate to any stated estimate, or if no estimate, to any normal or otherwise comparable prior requirements

Jan order was 5x larger than previous orders over 2-yr period, so unreasonably disproportionate to comparable prior reqs

Question 17

A homeowner mailed a letter to a prospective buyer on January 15 offering to sell her house for $25,000. The letter was delivered to the buyer on January 17. The buyer mailed a letter to the homeowner on January 19 stating that she accepted the offer.

The buyer’s letter of January 19 operates as an acceptance even under which of the following circumstances?

Answer 17

The buyer’s letter is lost by the post office.

Even if the post office loses the acceptance, a contract is formed. Under the mailbox rule, the acceptance becomes effective when the letter is put out of the possession of the offeree, i.e., when it is properly posted

Question 18

A landlord entered into a written four-year lease with a tenant for an apartment in the landlord’s apartment house. The tenant’s lease, and all leases in the apartment house, prohibited the playing of musical instruments between 10 p.m. and 8 a.m. The lease required the tenant to pay the rent on a monthly basis. Two years into the lease, the tenant assigned the lease to a nurse with the landlord’s permission. The nurse then assigned the lease to his brother with the landlord’s permission. The brother went into possession. A neighboring tenant in the same apartment house insisted upon playing a trumpet in a loud manner between 2 a.m. and 4 a.m. The brother complained to the landlord without success. Unable to sleep each night, the brother abandoned his apartment after occupying it for two months.

If the landlord sues the nurse for the rent due during the period after the nurse’s brother left, what would be the nurse’s best defense?

Answer 18

Lack of privity of estate.

nurse is assignee of tenant, no privity of estate (terminated when she assigned to bro)

no breach quiet enjoyment bc LL only owes that to tenant & his successors in interest (who have privity of estate)

Question 19

A property owner owned a tract of commercial property that he conveyed in joint tenancy to his twin sons as a birthday present. Unfortunately, a few years after the conveyance, the property owner and his sons had a serious falling out over how to run the family business. The property owner no longer wished the sons to control valuable commercial property, and so he demanded that they return the deed with which he conveyed the property to them. The sons returned the deed, and the property owner destroyed it. A few months later, one of the twins learned that he was seriously ill and not likely to live much longer. He executed a quitclaim deed conveying “any interest I have in the commercial property conveyed to me and my brother from my father” to his daughter. The twin who conveyed the property subsequently died.

Who owns the property?

Answer 19

The living twin and the deceased twin’s daughter as tenants in common.

conveyance of co-tenant’s interest in JT severs it to tenancy in common w/other co-tenants

Question 20

A landlord who owned a strip mall entered into a written five-year lease of one of the units with a discount retail perfumery. The lease provided for a monthly rent of $1,000, payable on or before the first day of each month. The perfumery dutifully paid its rent on time for two years and three months. At that time, with the oral permission of the landlord, the perfumery transferred its interest in the remainder of the lease to a dry cleaner in writing, and added a clause requiring the dry cleaner to get permission from the perfumery for any subsequent assignments. The dry cleaner promptly paid rent to the landlord for 14 months, and then asked the landlord to approve a transfer of its interest in the lease to a jewelry store. The landlord gave her oral assent. To obtain the perfumery’s approval of the transfer to the jewelry store, the dry cleaner wrote a letter to the perfumery, promising that if any problems arose and anyone tried to go after the perfumery for money, the dry cleaner would “make it good.”

After the perfumery sent a letter back to the dry cleaner agreeing to the transfer, the dry cleaner executed a written transfer of its interest to the jewelry store. The jewelry store promptly paid rent for three months. Having failed to make any profits, the jewelry store ceased paying any rent to the landlord and cannot be located. The landlord has been unable to find anyone interested in the unit.

Given that any judgment against the jewelry store would be worthless, from whom can the landlord collect the unpaid rent owed on the lease?

Answer 20

Either the perfumery or the dry cleaner.

this is assignment (OG tenant still has privity of contract)

here, assignee (dry cleaner) PROMISED the og tenant (perfumery) he’d pay all future rent, so the LL can sue the assignee as a 3rd party beneficiary of promise to OG tenant —> dry cleaner (assignee) made a promise to perfumery regarding obligation perfumery owed to LL (“make it good” if rent issues came up)

Question 21

On April 15, a seller entered into a valid written agreement to sell her home to a buyer for $175,000. The provisions of the agreement provided that closing would be at the buyer’s attorney’s office on May 15, and that the seller would deliver to the buyer marketable title, free and clear of all encumbrances.

On the date of closing, the seller offered to the buyer the deed to the house, but the buyer refused to go ahead with the purchase because his attorney told him that a contractor who had done work on the house had recorded a lis pendens on May 1 against the property regarding a $10,000 contract dispute he had with the seller. The seller indicated that she was unaware of the lien, but that she was willing to go ahead with the sale and set aside funds from the purchase price to cover the contractor’s claim until the dispute was resolved. The buyer still refused to proceed, stating that the seller had breached the contract.

If the seller brings an action against the buyer for specific performance, what is the probable result?

Answer 21

The seller prevails, because an implied term of their contract was that she could use the proceeds to clear any encumbrance on the title.

in a contract for the sale of real property, the seller of the land is entitled to use the proceeds of the sale to clear title if she can ensure that the purchaser will be protected. The seller’s offer to escrow the funds in this case should act as such guarantee.

*although there will be litigation over the contract dispute, the litigation will not affect the title to the land because the contractor is claiming only money damages and not an interest in the property.

Question 22

A buyer entered into a written contract with a seller to purchase his commercial property for $100,000. The contract did not specify the quality of title to be conveyed, and made no mention of easements or reservations. The closing was set for November 25, three months from the signing of the contract. Shortly thereafter, the buyer obtained a survey of the property, which revealed that the city had an easement for the public sidewalk that ran in front of the store. Because this actually enhanced the value of the property, the buyer did not mention it to the seller.

Subsequently, the buyer found a better location for her business. On November 1, the buyer notified the seller that she no longer intended to purchase the property. The seller told her that he intended to hold her to her contract. At closing, the buyer refused to tender the purchase price, claiming that the seller’s title is unmarketable and citing the sidewalk easement as proof of that fact.

In a suit for specific performance, will the seller likely prevail?

Answer 22

Yes, because the buyer was aware of the visible easement and it enhanced the value of the property.

The seller will prevail in his suit for specific performance because the easement was visible, the buyer was aware of it at the time she entered into the contract (i.e., she knew a public sidewalk ran in front of the store), and the easement enhanced the value of the property.

if an easement is not provided for in the contract, it usually renders the seller’s title unmarketable. There is an exception, however. A majority of courts have held that a beneficial easement that was visible or known to the buyer does not constitute an encumbrance.

the sidewalk easement does not impair the marketability of the seller’s title.

Therefore, the buyer’s excuse for her nonperformance is not valid, and because land is involved, the seller can get specific performance of the contract for purchase of the property.

Question 23

A seller owned a two-acre tract of land, on which he built a single-family residence. The seller entered into a contract to sell the land to a buyer for $200,000. One week before closing, the buyer had a survey of the property conducted. It revealed that a portion of the seller’s house was 5.98 feet from the sideline. The applicable zoning ordinance requires a six-foot sideline setback. The buyer refused to go ahead with the purchase of the land on the ground that the seller’s title was not marketable.

If the seller brings suit against the buyer for specific performance, will he prevail?

Answer 23

No, because the seller’s title is unmarketable.

The seller will not prevail because his title was unmarketable. There is an implied covenant in every land sale contract that at closing the seller will provide the buyer with title that is marketable. It need not be perfect title, but it must be free from questions that might present an unreasonable risk of litigation.

Because the placement of the seller’s house violated the zoning ordinance, the buyer could be subject to suit.

Question 24

To satisfy a debt owed to a creditor, a son executed and delivered to the creditor a warranty deed to a large tract of undeveloped land. The creditor promptly recorded the deed. Shortly thereafter, she built a house on the property and has lived there ever since. The son never actually owned the land. It belonged to his father, but the father had promised to leave the property to the son.

Later, the father died and his will devised the property to the son. Pressed for money, the son then sold the land to an investor by warranty deed, which the investor promptly recorded. Although the investor paid full value for the property, he purchased it strictly for investment and never visited the site. He therefore did not realize that the creditor was living there, and knew nothing of the son’s earlier deed to the creditor.

The jurisdiction in which the land is located has the following statute: “A conveyance of an estate in land (other than a lease for less than one year) shall not be valid against any subsequent purchaser for value without notice thereof unless the conveyance is recorded.”

Which of the following is the most likely outcome of a quiet title action brought by the creditor against the investor?

Answer 24

The creditor prevails, because the investor was not a purchaser for value without notice of the creditor’s interest.

☑️ Basic Facts Recap:
-The son deeded land to the creditor, but he didn’t actually own it yet (his father owned it).

-The creditor recorded her deed and moved in.

-Later, the father died and left the land to the son in his will.

-The son sold the land to an investor, who recorded the deed.

-The investor never visited the property and didn’t know about the creditor living there.

🔑 Key Legal Concepts:
1. Estoppel by Deed:
If someone (like the son) deeds property they don’t own, and then later gets title, that title automatically goes to the first grantee (the creditor).

BUT: This only works against the original grantor (the son), not necessarily future buyers.

2. Bona Fide Purchaser (BFP):
   A BFP is someone who buys property for value and without notice of any prior claims.

A BFP is protected under the recording acts if they meet those conditions.

3. Inquiry/Constructive Notice:
   If someone is living on the land, a buyer is expected to check.

If they don’t, the law treats them as if they knew whatever they would have learned from checking (i.e., they’re on notice).

✅ The creditor prevails, because the investor was not a purchaser for value without notice.
The investor would have seen that the creditor lived there if he visited.

That means the investor is on notice of her interest (called inquiry notice).

Because he had notice, he is not a bona fide purchaser, so he doesn’t get good title over the creditor.

Question 25

A landowner gratuitously conveyed his interest in land to a friend by quitclaim deed. The friend promptly and properly recorded her deed. Six months later, the landowner conveyed his interest in the same land to an investor for $50,000 by warranty deed, which was promptly and properly recorded. As between the friend and the investor, who has the superior right to title to the land?

Answer 25

The friend, regardless of the type of recording statute. -The friend recorded her deed before the landowner sold to the investor. -That means the investor had record notice of the friend’s ownership at the time of purchase. -Since the investor had notice, he is not a bona fide purchaser, so he cannot win under any recording statute. -It doesn't matter that the friend got the property for free (as a gift) or by quitclaim deed—recording protects her.

Question 26

On February 10, an owner took out a $10,000 mortgage on her land with a bank. On February 15, the owner conveyed the land for $50,000 to a buyer who was not aware of the mortgage. On February 17, the bank recorded its mortgage interest in the land. On February 21, the buyer recorded his deed to the land. Does the buyer hold the land subject to the bank's mortgage?

Answer 26

Yes, in a race-notice jurisdiction. buyer takes subject to the bank's mortgage in a race-notice jx bc it recorded first all recording acts apply to mortgages & deeds 💡 What Happened Here: The buyer is a BFP (no notice of the mortgage at time of purchase). -But the bank recorded first. -Therefore, the buyer loses and takes the property subject to the bank’s mortgage. ✅ Bottom Line: In a race-notice state, even if the buyer doesn’t know about a mortgage, they must also record before the mortgage to avoid being bound by it. Because the bank recorded first, the mortgage sticks.

Question 27

A landowner granted to his adjoining neighbor a written easement in a driveway that crosses the southwest corner of the landowner's property. The easement was not recorded. A statute of the jurisdiction in which the landowner's and neighbor's properties are located provides: "No unrecorded interest in real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded." In which of the following cases has the neighbor's easement been terminated?

Answer 27

The neighbor tells the landowner that she will no longer be using the driveway, and the landowner thereafter builds a garage over the driveway. easement would be terminated by estoppel by building garage over driveway for easement to be extinguished by estoppel, there must be: (i) some conduct or assertion by the owner of the easement and (ii) a reasonable reliance by the owner of the servient tenement coupled with (iii) a change of position. In this answer choice, even though the neighbor's release of the easement was oral, the landowner changed his position in reliance on that release in building the garage over the driveway.

Question 28

A landowner owned a tract known as Section 35. He subdivided Section 35, and sold a lot to a neighbor. The warranty deed that conveyed the property included the following language: COVENANTS *** Purchaser shall have a privilege to hunt and fish on all lands owned by Seller in Section 35. * * * These covenants shall run with the land. Years later, the landowner sold the remaining land in Section 35 to a builder. Shortly thereafter, the neighbor died, leaving the lot to her granddaughter. The builder posted "no trespassing" signs on his land. The granddaughter brought an action for declaratory judgment against the builder to enforce the granddaughter's ability to hunt and fish on the builder's land. What would be the likely result?

Answer 28

The granddaughter will win, because the warranty deed granted her a profit. profit is nonpossessory interest in land that allows grantee to enter on the land and remove resources of the land (here, it's fish and game). profit can be conveyed from the original grantee to a 3rd party (neighbor -->granddaughter). profit can be terminated in one of several ways: abandonment or misuse use of words "covenant" and "shall run with the land" shows landowner wants to create more than a bare license to hunt and fish.

Question 29

A landowner and his neighbor purchased adjoining undeveloped lots. After both built homes on their respective lots, the landowner suggested to the neighbor that a common driveway be built where the two lots joined. The neighbor agreed. The landowner and the neighbor split the cost of constructing the driveway and entered into a written agreement to equally share the costs of its upkeep and maintenance. The agreement was recorded in the county recorder's office. Two years later, the neighbor built a new driveway located entirely on his lot. The common driveway, which the landowner continued to use but which the neighbor no longer used, began to deteriorate. The landowner asked the neighbor for money to maintain the common driveway, but the neighbor refused to contribute. Three years later, the neighbor conveyed his lot to a friend. The friend entered into possession and used only the driveway built by the neighbor. By this time, the common driveway had deteriorated badly and contained numerous potholes. The landowner asked the friend to pay half of what it would take to repair the common driveway. The friend refused. The landowner repaired the driveway and sued the friend for 50% of the cost of repairs. Will the landowner prevail?

Answer 29

Yes, because the agreement between the landowner and the neighbor was recorded. Landowner will prevail bc recording the agreement gave friend constructive notice, thus preventing her from claiming the protection of the recording act defense to enforcement of the covenant. *EASEMENTS ARE NOT THE ISSUE HERE covenant at law will run w/ the land and be enforceable against subsequent grantees if: (i) the contracting parties intended it to run; (ii) there's privity of estate between the og promisor & promisee (horizontal privity) and vertical privity (promisor & his successor); (iii) covenant touches and concerns property and (iv) burdened party has notice of covenant if common driveway owners agree to be mutually responsible for maintaining driveway, burdens and benefits of these covenants will run to successive owners of e/parcel. implied cross easements for support satisfy the horizontal privity req bc they're mutual interests in the same property e/promise touches & concerns adjoining parcel --- where friend is in vertical priv w/neighbor holding same interest he held & has constructive notice, she'll be bound by agreement to maintain driveway easement appurtenant, like what's here, passes w/transfer of estates involved

Question 30

A grantor executed and delivered a deed to his son conveying his land as follows: "To my son for life, but if my son dies survived by his spouse and children, then to my son's spouse for life, with the remainder in fee simple to my son's children." A year later, the son died survived by his spouse and two offspring, a girl and a boy. The boy died intestate two days after the son, leaving one child as his only heir. The common law Rule Against Perpetuities is unmodified in the jurisdiction. What are the respective interests of the spouse, the girl, and the child in the land?

Answer 30

The spouse has a life estate, and the girl and the child have absolutely vested remainders. remainder to son's children was vested subject to open upon the birth of his 1st kid **Rule of convenience**, a **class gift** (like "to my son's children") closes when **at least one member is entitled to possession** AND **no more class members can be born**. Since son can't hav any more kids after his death,the class (his children) is **closed **. All members of the class are ascertained at that time and the remainder becomes indefeasibly vested. Nothing is conditional any more. grant was to "son's children" rather than "issue" or 'descendants," there's no unborn child problem --> we're only looking at son's immediate children, not grandchildren. **Inheritable of Vested Remainders**-------->a vested remainder is inheritable. When **boy died**, his vested remainder passed **by intestacy** to his **only child**

Question 31

A landowner conveyed his land to his wife, son, and daughter "as joint tenants with right of survivorship." The daughter then conveyed her interest to a friend. The wife subsequently executed a will devising her interest to the daughter. Then the son mortgaged his interest to a lender, who promptly and properly recorded the mortgage. The wife died, then the daughter's friend died, leaving a will that bequeathed her entire estate to the daughter. The daughter and the son survived. If the jurisdiction follows the title theory, who owns what interest in the land?

Answer 31

The lender and the daughter own unequal shares as tenants in common. Each holds 1/3 interest as **joint tenants**. They have **right of survivorship**(when one dies, their interest passes automatically to the survivors). 1. Daughter conveys her interest to a friend. **Joint tenancy is severed as to her interest. ** Friend now holds **a 1/3 interest as tenant in common.** **Wife and son still hold 2/3 as joint tenants** (because their four unities are intact). 2. Wife executes a will giving her interest to the daughter. This does nothing yet — wills are only effective at death. She still holds her 1/3 as a joint tenant (with the son). 3. Son mortgages his interest to a lender. The jurisdiction follows title theory, which says: A mortgage is a **transfer of legal title**. That severs the joint tenancy because the unity of title is destroyed. Now, wife, lender, and friend each hold 1/3 as tenants in common. 4. Wife dies. Since she now held her interest as a tenant in common (due to the mortgage severing the joint tenancy), her 1/3 passes via her will to the daughter. Friend dies, leaving all property to the daughter. The friend held her 1/3 as tenant in common. So her interest passes to the daughter via will. Son has no interest left bc his interest is legally held by the lender via title theory mortgage.

Question 32

A wealthy philanthropist owned a mansion built to his exact specifications, featuring a pipe organ built into the wall of the music room. The organ was impressive, with beautiful hand-carved wood scrollwork. The accompanying bench was made from the same wood as the organ and was carved to match the patterns on the organ. The bench was fully movable and could be slid into a niche beside the organ when not in use, although the philanthropist usually left the bench in front of the organ for its matching effect, even when the organ was not being played. The philanthropist died, and his will left all of his personal property to his daughter and all of his real property to a local charity. After the will was admitted to probate, the daughter removed all of the furniture and other movables from the mansion, including the organ bench. The daughter refused the charity's request to return the bench to the mansion. If the charity brings suit against the daughter to replevy the bench, who will prevail?

Answer 32

The charity, because the bench is integrally connected to the organ. Fixtures. Chattel that has been annexed to real property is converted from personalty (personal movable property) to realty. accessory to land passes w/ownership of the land rather than with a transfer of the personal property of an estate. Manifest intent of the annexor determines whether the chattel becomes a fixture. Factor's for evaluating annexor's intent are: (i) the relationship btwn the annexor and the premises, (ii) the degree of annexation, and (iii) the nature and use of the chattel Let's apply: 1. organ is clearly a fixture. Philanthropist was fee owner of mansion and had the organ built to his specifications when the mansion was constructed. 2. organ was built into the wall of the mansion and could not be easily removed. 3. appearance of organ and how it complemented the rest of mansion was probably more important to philanthropist than it's function. **Constructive annexation happens when article of personal property becomes integral part of the property, though it's not physically annexed to the property. Bench became intergral part of organ & contributed to organ's overall appearance, so replacing it would damage aesthetic value of organ.**

Question 33

A tenant agreed in writing to lease a retail site in a shopping mall from the owner of the property. The term of the tenancy was two years, and rent was payable in monthly installments at the beginning of each month. At the end of the second year, there had been no discussions between the tenant and the owner regarding renewal or termination. The tenant did not vacate the premises at the end of the term; instead, she sent a check for the next month's rent to the owner. The owner cashed the check and then informed the tenant that he was holding her to a new tenancy and a rent increase of 10%. What is the status of the tenancy that the owner created?

Answer 33

A year-to-year tenancy for the original rent amount. when a tenant continues in possession after the termination of her right to possession, the LL had 2 choices of action: 1. can treat the hold-over tenant as a trespasser & evict her under an unlawful detainer statute or 2. bind to new periodic tenancy --->terms & conditions of expired tenancy apply to new tenancy (unless residential lease) LL must have informed tenant bfor termination of OG tenancy of increased rent LL here would be holding tenant to year-year tenancy (commercial; residential would be mo-mo) and since didn't tell bfor of increased rent, new tenancy is OG amt rent

Question 34

To buy a house, an investor secured a $10,000 mortgage from a bank. The bank promptly and properly recorded its mortgage. Subsequently, the investor financed certain improvements to the house with a $2,000 mortgage on the land from a finance company. The finance company promptly and properly recorded its mortgage. Before the investor made a payment on either mortgage, the federal government announced that it would begin storing nuclear waste products in the area. The value of property, including the investor's house, plummeted. The investor did not pay either the bank or the finance company, and the bank brought a proper action to foreclose, notifying both the investor and the finance company. A buyer bought the house at the foreclosure sale for $6,000, which was its fair market value. There are no special statutes in the jurisdiction regarding deficiency judgments. What does the investor owe?

Answer 34

the investor remains personally liable to pay for any shortfall arising from the foreclosure sale. Proceeds from the sale are used to satisfy the loan that was foreclosed first --->so all proceeds, $6K, went to the bank so investor must pay the balance still due to the bank ($4K) and the entire amount of the finance company's mortgage, $2K, which is terminated by the foreclosure of the senior mortgage

Question 35

A seller put her house and lot on the market for $200,000. After receiving several offers within $5,000 of her asking price, the seller entered into a contract to sell the house and lot to a buyer for $200,000. The contract provided that the buyer put up $4,000 in earnest money, which the seller could treat as liquidated damages unless: The seller fails to tender marketable title to the buyer by the agreed-upon closing date, the seller commits a material breach of this contract, or the buyer dies prior to the closing date, in which case the earnest money shall be reimbursed to the buyer's estate. The contract was signed on July 24, and the closing date was set for September 12. On August 5, the buyer was seriously injured in an accident. On September 10, the buyer was released from the hospital in a wheelchair. He determined that a ranch-style house would make his life much more bearable, but the seller's home was two stories. The buyer asked the seller to cancel the contract and to refund the $4,000 earnest money. The seller refused. The buyer did not appear on the closing date. On September 16, the seller contracted to sell the home to a purchaser for $198,000. The closing occurred as planned on October 20. The buyer files suit against the seller, praying for a refund of the $4,000 earnest money. How much is the buyer likely to recover?

Answer 35

Nothing, because at the time the contract was entered into, $4,000 represented a reasonable estimate of damages in the event of breach. Courts usually let sellers keep a buyer’s earnest money if the buyer backs out, as long as the amount is reasonable. Many courts allow up to 10% of the sale price without question. In this case, the $4,000 deposit was only 2%, which is reasonable given the seller had similar backup offers. So, the seller can likely keep the money.

Question 36

A cyclist was injured when a driver ran a red light. The cyclist subsequently sued the driver to recover for her injuries, and obtained a money judgment of $50,000. The state where the cyclist and the driver reside has the following statute: "Any judgment properly filed shall, for 10 years from filing, be a lien on the real property then owned or subsequently acquired by any person against whom the judgment is rendered." The cyclist filed the judgment in the county where the driver owned a valuable ranch. Sometime later, the driver, who was also injured in the accident, undertook to remodel all the buildings on the ranch to make them wheelchair-accessible. The driver borrowed $30,000 from a bank for the improvements, securing the loan with a mortgage on the ranch. The bank properly recorded its mortgage. Before he paid any principal on the bank's loan, the driver decided to build a new barn. He borrowed $20,000 from a financing company for this purpose, also secured by a mortgage on the ranch. The financing company properly recorded its mortgage. The driver subsequently defaulted on the bank's mortgage, and the bank brought a foreclosure action, joining the financing company in the proceeding. The foreclosure sale resulted in $90,000 in proceeds after all expenses and fees were paid. The driver still owes the cyclist $50,000, the bank $30,000, and the financing company $20,000. How should the foreclosure proceeds be distributed?

Answer 36

The bank is entitled to $30,000, the financing company is entitled to $20,000, and the driver is entitled to the remaining $40,000. 📠 **Facts:** The cyclist won a $50,000 judgment against the driver and filed it, making it a lien on the driver's property. The driver borrowed $30,000 from a bank (first mortgage), then $20,000 from a financing company (second mortgage). Both were secured by the ranch and properly recorded. The bank foreclosed and the property sold for $90,000. Driver still owes: Cyclist: $50,000 (judgment lien) Bank: $30,000 (first mortgage) Financing Co.: $20,000 (second mortgage) 🔑 Key legal rules: **Foreclosure proceeds** pay debts in this order: **Foreclosing mortgage holder** (the bank) **Junior lienholders** (financing company) **Anything left goes to the property owner** (driver) **Senior liens** (like the cyclist’s judgment lien) **survive** foreclosure—they are not paid from the proceeds unless that lienholder also forecloses. cyclists's $50K lien remains on property but she gets no money from this foreclosure bc she didn't foreclose her lien

Question 37

A homeowner borrowed $50,000 from a bank, secured by a mortgage on his home. Shortly thereafter, the homeowner sold his home to a buyer for $70,000 by a deed containing a recital signed by both parties that title passed "subject to" the bank's mortgage, "which obligation grantee expressly assumes." The buyer paid the homeowner $20,000, took possession of the house, and began making monthly payments of principal and interest to the bank. A few years later, a chemical manufacturing firm built a huge sulfur processing plant just down the road from the home, which caused the house to immediately decline in value to $35,000. Subsequently, the buyer stopped making the monthly payments to the bank. The bank exercised its contractual right of nonjudicial foreclosure and sold the house at a public auction for $34,000. The bank then brought suit against the homeowner and the buyer for $14,000, the difference between the proceeds of the foreclosure sale and the $48,000 principal remaining due on the original loan to the homeowner. The jurisdiction does not bar deficiency judgments. Against whom should the bank be granted a judgment for $14,000?

Answer 37

Both the homeowner and the buyer. 🔹 **Key Legal Rule:** **When a buyer "assumes" a mortgage, they become personally liable for it**. The original borrower (homeowner) is still on the hook unless the bank releases them. The bank can sue both: The buyer (now **primarily** liable). The original homeowner (still **secondarily** liable). ✅ The bank can sue both, but can only collect a total of $14,000, not double. remember, you got tripped up on language here. If the buyer had only taken "subject to the mortgage" then there would've been no assumption. 🔹 **1. “Subject to the Mortgage” (No Assumption)** The buyer **takes the property knowing the mortgage exists**, but does **not agree to be personally responsible** for the debt. The mortgage stays on the property, and if the buyer fails to pay, the lender can foreclose — but cannot sue the buyer personally. Only the original homeowner remains personally liable to the bank. ✅ This is a non-assumption — the buyer risks losing the property, but not being sued for the debt.

Question 38

A developer and an investor had been in the real estate business for many years. Because of their long-standing relationship, the developer and the investor, neither of whom was an attorney, often dispensed with certain legal formalities when dealing with each other, thus saving the costs of lawyers' fees and other attendant expenses. The investor owned a parcel of land that the developer was interested in. At lunch one day, the developer offered to buy the parcel from the investor for $50,000. The investor accepted the developer's offer, and the parties agreed on June 15 as the closing date. The developer wrote out and handed the investor a check for $2,500 with "earnest money" written in the memo, and they shook hands on their deal. A few weeks before closing, the developer called the investor and told him she had changed her mind about purchasing the land because of a sudden economic downturn in the area. The investor appeared at the developer's office on June 15 with the deed to the land in his hand. The developer refused to tender the balance due, and the investor sued the developer for specific performance. Will the investor prevail?

Answer 38

No, because the agreement does not comply with the Statute of Frauds and is, therefore, unenforceable. the check contains neither a description of the property that is the subject of the agreement nor the price. Thus, the check is not a writing sufficient to satisfy the Statute of Frauds. **Also remember, with the SoF The doctrine of part performance generally requires two of the following: possession, improvements, and full or partial payment of the purchase price**

Question 39

A rancher entered into a written contract to buy a farm from a farmer for $100,000. The contract stipulated for closing on September 30. In addition, the contract contained the following provision: "The taxes shall be prorated as agreed to by the parties at a later date." Upon the signing of the contract, the rancher gave the farmer a check for $10,000 as a down payment. On September 28, the rancher notified the farmer that he would not be able to close on the farm until October 2, because the closing on his current home, the proceeds from which were to be applied to his purchase of the farm, was unavoidably delayed due to his buyer's illness. Meanwhile, the farmer had difficulty finding a home she liked as well as the farm. She decided that she would rather not sell the farm and wished to avoid the contract with the rancher. On October 2, the rancher showed up at the closing with the $90,000 to tender to the farmer. The farmer did not show up. The rancher sues for specific performance. In whose favor will the court most likely rule?

Answer 39

The rancher, because time was not of the essence. In general, courts presume that time is not of the essence in real estate contracts. Thus, the closing date stated in the contract is not absolutely binding in equity, and a party, even though late in tendering his own performance, can still enforce the contract if he tenders within a reasonable time **Binding in equity: It refers to whether a court of equity (like a court handling specific performance) will treat the contract’s closing date as a strict, enforceable deadline --- 1-2 mos usually considered reasonable.** Time will be considered of the essence only if: (i) the contract so states, (ii) the circumstances indicate it was the parties' intention, or (iii) one party gives the other notice that he desires to make time of the essence. The contract in this case made no mention that time was of the essence.

Question 40

A landowner owned a large tract of land containing numerous coal mines. To finance the renovation of some of the buildings on the land, the landowner obtained a $50,000 mortgage from a bank. Shortly thereafter, the landowner, without notifying anyone of the bank's interest, sold the surface of the land to his sister and the mineral rights to a utility company. The bank recorded its mortgage the next day; the day after that, the utility company recorded its deed; the following day, the sister recorded her deed. None of the parties dealing with the landowner had any knowledge of the others at the time of their transactions. The jurisdiction in which the land is located has the following statute: "No conveyance or mortgage of an interest in land is valid against any subsequent purchaser for value without notice thereof whose conveyance is first recorded." If the sister brings an action to quiet title to the land, what would be the most likely result?

Answer 40

The sister would have a fee simple interest subject to the mineral rights of the utility company and the mortgage held by the bank. 🧠 **What's the big picture?** This is a recording statute question. The jurisdiction follows a **race-notice statute**. That means: To win protection, a buyer for value must: -Take without notice of prior claims (notice), and -Record first (race) Bank records first Utility records 2nd Sis records last -she loses in every scenario so she owns the land, but it's subject to bank's mortgage and utility's mineral rights. **bank doesn't own the land just bc it recorded first --- it holds a mortgage**, which is a **security interest**, not an ownership interest. The bank is a creditor, not a landowner. Bank would only become owner if it forecloses on property, and even then, it has to follow legal procedures.

Question 41

A testator executed a will, devising his land "to my son and my daughter, share and share alike." Shortly thereafter, the daughter died intestate, leaving a child as her only heir. The next year, the testator and his son were involved in a car accident. The testator died immediately. The son died six days later, leaving a will that bequeathed his entire estate to his wife. The jurisdiction has the following statute: "If a devisee, including a devisee of a class gift, who is a grandparent or a lineal descendant of a grandparent of the testator is dead at the time of execution of the will or fails to survive the testator, the issue of such deceased devisee shall take the deceased's share under the will." Who owns the land?

Answer 41

The daughter's child and the son's wife each own an undivided one-half interest in the land. 🔹**1. The Testator's Will:** -The son and daughter each get ½ of the land. -This creates a tenancy in common (each owns a ½ interest in the whole land). 🔹**2. Then the Daughter Dies Intestate: She dies before the testator.** She has a child, who is her only heir. Normally, when a beneficiary dies before the testator, their gift fails (lapses). But this state has an anti-lapse statute. 🔹**3. The Anti-Lapse Statute: This law says:** If a devisee (like the daughter) is a descendant of the testator, and dies before the testator, their issue (child) takes their share. ✅ So, the daughter’s ½ interest passes to her child under the anti-lapse statute. 🔹**4. Then the Testator Dies At this moment: ** The will takes effect. The daughter's child is entitled to ½ the land. The son (still alive) becomes entitled to the other ½. 🔹**5. The Son Dies 6 Days Later** He already owned a ½ interest in the land. He leaves a will giving everything to his wife. ✅ So, his ½ interest in the land passes to his wife through his will. 🔹**6. Final Ownership** Daughter’s child owns ½ (through anti-lapse). Son’s wife owns ½ (through the son’s will). They are tenants in common, meaning: Each owns ½ of the entire property, not separate halves of land.

Question 42

A landowner and her neighbor owned adjacent parcels of land. The landowner hired a contractor to install an in-ground swimming pool on her land. The day after the contractor had excavated for the pool, the neighbor's storage shed, located on his property a few feet from the edge of the excavation, collapsed when the ground shifted. A riding tractor and patio furniture contained within the shed were damaged. The neighbor sued the landowner for damages. At trial, the neighbor established that the landowner's project caused the subsidence and the damage to his property. What else must the neighbor establish to prevail?

Answer 42

That his land would have been damaged without the storage shed or that the contractor was negligent. landowner has right to have his land supported in its natural state by adjoining land neighbor has to show either that subsidence woulda occurred even if the land had been unimproved (w/o storage shed) OR that contractor hired to excavate the pool was negligent

Question 43

A father gave his daughter marketable title to a five-acre parcel of undeveloped land that adjoined 200 acres of uninhabited forest owned by a neighbor. When she visited her property with her father, he mistakenly pointed out the boundary line. She subsequently staked out the boundaries and built a log fence along what she thought was the boundary line. Approximately an acre of the neighbor's land was inside her fence. The daughter built a cabin and lived in it for 30 years until she had to sell the property for medical reasons. The daughter entered into a contract to sell the land. In accordance with the contract, the purchaser had a survey of the land done, which revealed the boundary discrepancy in the legal description. The purchaser contacted the neighbor, who said he knew nothing of the matter and did not consent to the daughter's placement of the fence on his property. The purchaser then refused to proceed with the purchase. The jurisdiction in which the parcel was located had a 20-year period of occupation to satisfy the requirements of adverse possession. If the daughter sues for specific performance of the land sale contract, will she prevail?

Answer 43

No, because the daughter's title to the land is not marketable. **Core Legal Issue: ** Can the daughter enforce the sale contract when the survey reveals that part of the land is not in her official title? 1. she did satisfy all 6 reqs of adverse possession --- exclusive, continuous, visible *“hostility” in adverse possession doesn’t require bad faith or the true owner’s knowledge—just that the possessor occupied it without permission. 2. Marketable title means a **title that a reasonable buyer would accept**—it’s clear, free of serious doubts or litigation risk, and not dependent on someone having to go to court to resolve it. ⚠️ Even if someone has gained title by adverse possession, **that title is not considered marketable until a court has issued a judgment quieting title** (confirming ownership officially in the public record). The buyer hired a surveyor, who discovered the mismatch between the legal title and the occupied land. The buyer would have to deal with potential litigation or uncertainty to fully own what’s being sold—buyers aren't required to do that. Because of this, the buyer refused to go through with the purchase.

Question 44

A buyer purchased a tract home in a new development, putting up 10% of the purchase price as a down payment and financing the rest through a mortgage with a bank. After four years, the buyer put her house on the market, continuing to make all mortgage payments promptly. The buyer eventually sold the house to a third party, who took subject to the mortgage. After the third party took possession, the bank received no further mortgage payments from either the buyer or the third party. In most states, which of the following best describes the remedy or remedies available to the bank?

Answer 44

The bank may foreclose on the land, or it may sue the buyer on the underlying debt. If a buyer takes property “**subject to**” a mortgage, they are **not personally liable** for the debt the buyer “**assumed**” the mortgage here, so they're personally liable --- bank can foreclose or sue the buyer on the debt 3rd party only took "subject to"

Question 45

A first-time home buyer financed the purchase of a house with a $100,000 mortgage she took out with a bank. The mortgage was recorded. A few years later she borrowed $5,000 from a finance company to pay for a foreign trip, using her house as security. The finance company promptly and properly recorded its mortgage on the property. One year after that, she borrowed $40,000 from an equity company to pay for an addition on the house. The equity company promptly and properly recorded the mortgage it took on the property. Shortly thereafter, she lost her job and was unable to make payments on either the finance company's or the equity company's mortgages, but she was able to make payments on the bank's mortgage. The finance company filed foreclosure of its mortgage and included the equity company in the action, and a purchaser bought the property at the foreclosure sale. What is the purchaser's obligation regarding the bank's mortgage and the equity company's mortgage?

Answer 45

The purchaser takes the property subject to the bank's mortgage, but not subject to the equity company's mortgage. a foreclosure sale wipes out all junior mortgages (recent) but doesn't wipe out senior mortgages Bank's mortgage preceded the finance company's, it's senior and NOT wiped out. Purchaser takes subject to mortgage

Question 46

An owner conveyed her property to a buyer, who put the deed in his suitcase and took off for a five-month tour of the world. The owner, knowing that the buyer had left the country, sold the property to an investor who was not aware of the previous transaction. The investor did not record her deed. When the buyer returned from his trip, he recorded his deed. A month later, the investor conveyed the property to a developer. The developer knew that the buyer held a deed to the property but completed the transaction anyway. Instead of recording, however, the developer immediately filed an appropriate action against the buyer and against the investor to determine ownership of the property. The property is situated in a jurisdiction containing the following statute: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice, unless the conveyance is recorded." How should the court rule?

Answer 46

The developer has rights superior to those of both the buyer and the investor. notice statute --- last BFP to record wins. If prior grantee previously recorded, subsequent purchaser ordinarily will be deemed to have record notice of the prior conveyance and won't be a BFP. Owner resold property to investor before buyer recorded his deed to property, so investor had no notice of the transfer bc investor had no actual knowledge or inquiry notice, she qualifies as BFP under shelter rule, person taking from BFP will prevail against any interest that transferor-BFP would have prevailed against ---> even tho developer knew buyer held deed to property, developer prevails against buyer bc investor would've prevailed against buyer

Question 47

A landowner contracted in writing to sell a lot to a brother and a sister, as joint tenants, for $60,000. The brother and the sister put up $6,000 as earnest money. Before the closing date, the landowner died. Shortly thereafter, and also before the closing date, a garage on the lot burned down. The garage had a fair market value of $6,500 and was a complete loss. After the fire, the brother demanded that the executor of the landowner's estate return the $6,000, because the brother and sister were no longer interested in the property. The executor refused and told the brother that he expected the brother and sister to tender the $54,000 due on the property when the closing date arrived. The brother and sister did not do so. The brother filed suit demanding a refund of the $6,000. The executor countersued, demanding specific performance by the brother and sister or, in the alternative, monetary damages. Absent any applicable statutes, how should the court rule?

Answer 47

In favor of the executor, by requiring specific performance of the brother and sister. contract for sale, then transfer of land ------> risk of loss to property shifts to buyer any loss, whether fire or smth else, buyer must pay contract price at closing date bro & sis breached contract, since they were under a duty to tender amt due on property --->they owe payment of balance due on contract & executor can get specific performance

Question 48

Several decades ago, a square tract of 640 acres was subdivided into lots, streets were constructed, and utilities were installed. As the developer sold off each of the lots, each lot's deed contained a restriction limiting the lots to residential use only. The deeds were all recorded. Over the years, houses were constructed on all of the lots. The property to the south, east, and west of the subdivision was initially forest, but gradually the city expanded to surround the development. Unfortunately, the city expansion was mostly industrial and some commercial property, but no residential property. The subdivision is now bounded on all sides by many industries that operate 24 hours a day. The combination of noise, dirt, fumes, and other pollution has made many of the houses in the subdivision unfit for residential use, yet each deed still stipulates "residential use only." Can the restriction be voided under the doctrine of changed neighborhood conditions?

Answer 48

No, the restriction cannot be voided unless the entire subdivision is so seriously affected by the pollution that enforcement of the restriction would be inequitable. restrictive covenants on all lots in a subdivision like this can be voided if changed conditions have made the property unusable for the specified use, and this means entire subdivision must have changed so significantly that enforcement of restriction would be inequitable if some houses in center of subdivision are not affected by pollution, no restrictions can be voided if all lots affected, all restrictions voided

Question 49

A woman who owned a parcel of land had direct access to the main road by an unpaved driveway. However, she decided that it would be more convenient to use a paved driveway on an adjoining parcel, so she began doing so. The man who owned the adjoining parcel also used the driveway, but he did not discover that the woman was using the driveway until two years later. At that time, he wrote a letter to the woman protesting the use of the driveway, but the woman continued to use the road. After she had used the road for a total of 20 years, she filed an action for declaratory judgment, claiming a prescriptive right to use the driveway on the west parcel. The time limit necessary to obtain an easement by prescription in this jurisdiction is 20 years. Which of the following is the most accurate statement with regard to the woman's use of the driveway now?

Answer 49

The prescriptive period began to run when the woman first began using the driveway despite the fact that, at that time, she was sharing her use with the man. THIS IS NOT ADVERSE POSSESSION --- she's just using the man's driveway The woman's first use of the driveway started the prescriptive period running. There is no requirement of exclusive use for the woman to obtain an easement by prescription. Exclusivity is only required in cases of adverse possession. Adverse possession is not at issue here because the woman has not "possessed" any part of the west parcel, and does not require title to continue her use of the property, which is all she seeks. the prescriptive period began to run when the woman began using the driveway. The fact that the man was not aware of it and did not contest it is irrelevant, because her initial use of the driveway was without permission.

Question 50

A man and a woman who owned two adjacent properties executed and recorded reciprocal easements to five-foot strips of land on the border of their properties for the purpose of constructing a 10-foot-wide common driveway to their street, on which each of them had only five feet of frontage. After the driveway had been constructed, the town constructed a new road abutting the woman's property in the rear. The woman constructed a new driveway to that new street, and soon thereafter ceased using the common driveway. One year later, the woman sold the property to a buyer, who used the new driveway for four years and did not use the old one. The man then commenced using the entire 10 feet of the old driveway by parking his cars on both sides, and the buyer commenced an action to prevent the man's use of the five feet of the driveway on the buyer's land. The period for acquiring title by adverse possession in the jurisdiction is five years. What is the likely outcome of the action?

Answer 50

The buyer will prevail because nonuse is insufficient to cause abandonment of the easement. easement by grant easement wasn't used for 5 yrs, but there wasn't acts that would've terminated easement by adverse possession or a manifest intent to abandon NO TERMINATION UNLESS THERE'S INTENT TO PERMANENTLY ABANDON EASEMENT **don't be fooled by long periods of nonuse in fact pattern** OR fee owner (man) would have to exclude buyer from using easement in open & notorious manner for period necessary to acquire easement by Rx

Question 51

Question The owner of a house purchased a new home but decided to keep his old residence for a few months until the real estate market improved. He rented it to a tenant with the understanding that the tenant might have to move out in a few months if the house was sold. The tenant paid the owner the agreed rent of $100 per week every Friday. During the next few months, the owner's business suffered serious setbacks so he decided to sell his new home and move back into his old one. He informed the tenant that he would have to vacate the old home, but the tenant refused to vacate and tendered the $100 rental payment the following Friday, which the owner refused to accept. The owner immediately filed suit to eject the tenant. The jurisdiction requires that a statutory written notice be served on any tenant whose term is for less than month-to-month or is not for a fixed term at least three days prior to commencement of eviction proceedings. No written notice of any kind was given to the tenant. How should the owner characterize the tenant to gain immediate possession of his home?

Answer 51

As a licensee. A license is a privilege to enter onto another's property. It may be revoked at any time merely by a manifestation of the licensor's intent to end it.

Question 52

A husband and wife held land as joint tenants with right of survivorship. On the marriage of their daughter, the husband and wife conveyed a 10% interest to her. Two years later, the husband and wife conveyed another 10% interest to the daughter's spouse. Which of the following best describes how the land is now owned?

Answer 52

The husband and wife hold an 80% interest as joint tenants, and the daughter and her spouse each hold a 10% interest as tenants in common. **Because both the husband and wife joined in the conveyance to their daughter, their interests remain undisturbed as joint tenants**. When the husband and wife then conveyed 10% to the daughter's spouse, they each retained their 40% as joint tenants with one another, and the spouse's 10% is, by severance, a tenancy in common.

Question 53

An uncle who owned a large tract of wooded land in fee simple had always opened his land to hunters from the local hunting club, and had often expressed the wish that they be permitted to continue to use it after he died. On his 75th birthday, he conveyed the land to his niece and nephew, who were members of the hunting club. The deed was a general warranty deed conveying the property in fee simple absolute. A few days later, the niece had a serious dispute with the nephew and the other members of the hunting club, and she quit the club. The uncle then executed a written agreement with the nephew stating that the conveyance of the land to the niece and nephew was in trust for the benefit of the local hunting club for a period of 10 years, with the niece and nephew as trustees, and then to the niece and nephew in fee simple. Several months later, the uncle died. When the next hunting season drew near, the nephew told the niece that members of the hunting club were once again planning to hunt on the property. The niece threatened to have anyone hunting on the property other than the nephew arrested for trespassing. The nephew brought an action for appropriate legal or equitable relief to establish his rights and the rights of the hunting club. What, if any, relief should the court provide?

Answer 53

Partition the land into two separate tracts so that the nephew may permit the hunting club to use his half. this is testing partition ---court should partition land into 2 separate tracts. Niece & nephew have tenancy in common, so e/has right to possess all portions of property, not exclusive possession to any part TC has right to judicial partition, in kind or by sale & division of proceeds -->when cotenants squabbling & cant come to any agreement, remedy of partition terminates cotenancy & divides common property. **Niece & nephew cant agree on use of land by members of hunting club, so court will probz partition property**

Question 54

Owen owned Blackacre in fee simple. He executed a will leaving the property to his sister, Sarah, for life, with remainder to the children of his niece, Norah. At the time of the execution of the will, Norah had one daughter, Donna. The next year, Norah had a son, Sam. A year later, Owen died. Shortly after Owen's death, Donna died in a plane crash, leaving all of her estate to her husband, Harold. One year after Owen's death, Norah had another daughter, Debbi. Shortly thereafter, Sarah, Owen's sister, died. Sixteen months after that, Norah had a second son, Sid. Now who owns Blackacre?

Answer 54

Harold, Sam, and Debbi in equal shares. Why is Sid left out? Bc of class closing rule --- whenever any member of the class is entitled to a distribution, the class closes & the distribution is made then. Any later arrivals to the class lose out entirely. Bc Sam, Harold & Debbi are eligible for a distribution the moment the life tenant (Sarah) dies, they take, and Sid, not yet born, loses out.

Question 55

A landowner properly executed a warranty deed conveying her land to an animal shelter "so long as the premises are used for animal shelter purposes." The animal shelter promptly and properly recorded the deed. A few years later, the landowner died intestate, with her husband as her only heir. The following year, the husband conveyed by means of a quitclaim deed "all of my interest" in the animal shelter land to his daughter from a previous marriage. The daughter promptly and properly recorded the deed. Last month, the animal shelter closed due to lack of funding. A domestic violence shelter wishes to use the land and petitions the court to allow it to take the animal shelter's place. If there is no applicable statute, the court should hold that title to the land is in which party?

Answer 55

The daughter, because the land is no longer used for animal shelter purposes. fee simple determinable is estate that automatically terminates on the happening of a stated event & goes back to grantor interest that is left in a grantor who conveys a fee simple determinable is a possibility of reverter (which is transferable, devisable, and descendible) animal shelter has fee simble subject to automatic termination if land is no longer used for animal shelter purposes landowner's possibility of reverter descended on her death to her hubby, who transferred it by inter vivos (while both alive) conveyance to his daughter. When land ceased to be used for animal shelter purposes, automatically reverts back to daughter **Fee simple determinable automatically terminates on the happening of the stated event**

Question 56

A woman owned 400 acres of land, half of which was densely wooded and the other half of which was almost entirely occupied by a large gravel pit which supplied gravel for her small landscaping business. A small house located on the edge of the pit was in very poor condition and had been vacant for many years. The woman transferred the 400 acres to her son for life, with the remainder going to a local charity on the son's death. Now the son wants to increase gravel production and expand the pit by tearing down the house. He also wants to cut the trees on the wooded half and sell them for profit. The local charity, holder of the remainder, sues to enjoin the son from doing any of these things. How will the court likely rule?

Answer 56

The charity can stop the tree cutting but not the gravel mining or the destruction of the house. charity would be suing life tenant on **theory of waste** **Issue** -can a life tenant (the son) be stopped by the remainderman (the charity) from: 1. Expanding gravel mining 2. cutting down trees 3. tearing down an old, unused house **Key Concepts:** -Waste: a life tenant must not damage the value of the property for the remainderman. * **voluntary waste:** intentional harm, like removing natural resources * **Ameliorative waste:**changes the improve the land but alter it significantly **Rules Applied:** 1. Gravel mining: allowed -mining was already happening when the son inherited the life estate, so it's considered a **preexisting use. This is an exception to the rule against removing resources.** 2. Tree cutting: not allowed -the land wasn't being used as a tree farm, so this is **voluntary waste**. The charity can stop it. 3. Tearing down the house: allowed -though destroying a structure is usually **ameliorative waste**, it's permitted here bc the house is in poor condition & sits on the edge of the pit. **This is a "changed conditions" exception.**

Question 57

An elderly grandfather who wanted to ensure that his property would remain in the family after his death included the following clause in his will: "I give my house in the city to my son, but if he ever tries to sell it while he is alive, I want it taken away from him and given to my grandson." The grandfather's will was properly executed. When the grandfather later died, what interests did the son and grandson take in the property?

Answer 57

The son took a fee simple. grandpa attempted to give his son a fee simple, but placed restraint on alienation. Direct restraints on alienation of a fee simple are void Grant is read as if it had been "O to A in fee simple" Grandson gets nothing **remainders NEVER follow fee simple**

Question 58

A landowner leased 150 acres of farmland to a produce company for 15 years. The produce company used the land for crops along with several other contiguous acres that it owned or leased. About four years into the lease, the state condemned a portion of the leased property because it intended to build a highway. As a result, too little property remained for the produce company to profitably farm, although there still existed the farmhouse on the property, which was being used by one of its foremen. The produce company gave the landowner 30 days’ written notice that it considered the lease to have been terminated because of the condemnation. In a suit for breach of contract, is the landowner likely to win?

Answer 58

Yes, because the condemnation did not affect the produce company’s obligation to pay the full rental price, although it is entitled to share in the condemnation award. Tenant's compensation rights: 🔑 1. **Partial condemnation** = when the government takes part of a leased property for public use (like building a road), not the entire property. 2. **Lease continues**: Even though part of the property was taken, the lease doesn’t end. The tenant still has to pay full rent (unless the lease says otherwise), for the remaining term 💡 💡 💡 Because the tenant is still paying full rent but has lost part of the property, the tenant may be entitled to a share of the government’s condemnation award (money paid for the taking). The amount the tenant receives depends on how much the taking reduced their benefit under the lease (e.g., lost parking area, storage space, etc.). **--> In partial takings, the lease stays in effect, rent stays the same, but the tenant can be compensated for any loss in lease value caused by the taking.**

Question 59

To secure a loan of $100,000 from a bank, the owner in fee simple of a parcel of land conveyed a deed of trust for the land to the bank. The deed of trust contained a “power of sale” clause, permitted by the jurisdiction, which allowed the bank to sell the property in the event of default without the necessity of a judicial foreclosure action. After several years, the owner defaulted on his loan payments to the bank. The bank informed the owner that it was exercising its power of sale. After appropriate notices, the bank conducted a public sale of the land. The bank was the sole bidder and obtained the property for $80,000, which was $10,000 less than the outstanding balance on the loan plus the expenses of the sale. One month later, the owner notified the bank that he wanted to pay off the loan and extinguish the deed of trust, and was prepared to tender $80,000 to do so. The bank insisted that the owner must tender $90,000 to pay off the loan. If a court in the jurisdiction will require the bank to accept only $80,000 under the circumstances above, what is the likely reason?

Answer 59

The owner was exercising a statutory power rather than an equitable power. **❓The Legal Issue: **Can the borrower redeem the property after the foreclosure sale by paying $80,000 (the sale price), or must they pay $90,000 (the total debt + expenses)? **1. Equitable Right of Redemption (before the foreclosure sale):** This is a common law right. A borrower can "redeem" the property any time before the foreclosure sale by paying the full amount due (typically the full loan balance). Once the sale happens, this right ends. **2. Statutory Right of Redemption (after the foreclosure sale):** Some states also allow borrowers to redeem the property after the foreclosure sale, usually for a limited time (e.g., 6 months or 1 year). Under this statute, the borrower typically must pay the price the property sold for at foreclosure, not the full debt amount. That’s what’s happening here: the original owner is trying to exercise a statutory right to buy the property back for $80,000, the foreclosure sale price. 💡 **Final Takeaway:** **If a borrower is allowed to buy back their foreclosed property after the sale, and they only need to pay the sale price, they’re using a statutory right of redemption. **"Clogging the equity of redemption" means the bank cannot include terms in the mortgage that waive the borrower’s right to redeem before foreclosure.** That’s not the issue here. There's no evidence that the owner was barred from redeeming before the sale. The issue is post-sale redemption, which is statutory, not equitable.