CH 2: Property Estates & Ownership

Question 1

estate

Answer 1

an interest or a right in property

Question 2

future interest

Answer 2

right to possession in the future

Question 3

leasehold estate

Answer 3

specific duration

Question 4

Primary characteristics of a freehold estate:

Answer 4

1. Possession either immediately or in future
2. indefinite duration of possession
3. property ownership

Question 5

fee simple estate

Answer 5

owner possess full bundle of rights, limited only by government power.

Question 6

possibility of reverter

Answer 6

contingent future interest in the land

Question 7

fee simple subject to a condition subsequent

Answer 7

“on the condition that”

• former owner has power of termination - can take steps to re-enter land to see if the condition is being complied with, if not, they can legally take possession away from landowner through due process

Question 8

leased fee interest

Answer 8

lessor (landowner) interest in leased property

- lessor owns the property and other rights, but due to the lease, cannot occupy or possess the property

Question 9

life estates

Answer 9

freehold estates that last only as long as a specified person lives
- holder is called the life tenant

Question 10

life estate pur autre vie

Answer 10

freehold estate that lasts for another’s life

Question 11

reversionary interest (life estate)

Answer 11

grantor has future interest in a life estate

Question 12

remainder interest (life estate)

Answer 12

future interest belongs to someone other than the grantor

Question 13

remainderman (life estate)

Answer 13

person with the future interest (not the grantor)

Question 14

leasehold estates (tenancy)

Answer 14

interests that give the holder temporary right to possession without title

• involves 2 parties: holder of leasehold - lessee/tenant
• owner/lessor/landlord

Question 15

Estate for years

Answer 15

• any leasehold estate for a fixed time (not necessarily years)
• also term tenancies
• terminates at end of lease

Question 16

surrender

Answer 16

ending a lease by mutual consent

Question 17

periodic tenancy

Answer 17

estate from period to period - not a specified time

Ex: regular lease is up on your apt and you just go to “monthly” renting

Question 18

tenancy at will

Answer 18

• leasehold w/ no specific term
• either party can term at any time
• cannot be assigned to someone else and automatically ends upon death of either party

Question 19

tenancy at sufferance

Answer 19

possession of property by a holdover tenant

- not different from a tresspasser

Question 20

title

Answer 20

acutal lawful ownership of real property and refers to holding the bundle of rights conveyed

Question 21

ownership in severalty

Answer 21

-ownership by one person or entity

Question 22

corporation

Answer 22

legal entity where individuals hold shares of stock

Question 23

real estate investment trust (REIT)

Answer 23

investment corp or trust w/at least 100 investors and organized as a trust
- pools of many investors’ money can be used to purchase real estate

Question 24

Distinction of Co-Ownership (PITT)

Answer 24

Possession
Interest
Time
Title

Question 25

Unity of Possession

Answer 25

each owner is entitled to possession of the entire property | - burden of maintaining land (taxes etc) fall on each co-owner in proportion to their share of ownership

Question 26

Unity of Interest

Answer 26

means each co-owner has an equal interest in property | - 50/50

Question 27

Unity of time

Answer 27

acquired title at the same time

Question 28

Unity of title

Answer 28

acquired title through same instrument

Question 29

tenancy in common

Answer 29

- most basic form of co-ownership - does not include right of survivorship - each co-owner can do what they want with their interests - UNITY OF POSSESSION ALWAYS PRESENT - one tenant can get a judicial partition action by filing in court

Question 30

Joint Tenancy

Answer 30

can be formed only with: - unity of possession - unity of interest (same estate and equal share) - unity of time - unity of title Includes survivorship can be terminated by agreement, partition, or severance

Question 31

Tenancy by the entireties

Answer 31

- recognized by 1/2 states - only an option for married couples - each spouse owns undivided one-half w/ right of survivorship - neither spouse can convey w/o consent

Question 32

Separate Property (Marital Property Rights)

Answer 32

property that was owned by either hus/wife before they were married - can be transferred w/o consent of spouse not on title

Question 33

Community Property (Marital Property Rights)

Answer 33

- was acquired by spouse during marriage - upon death, surviving spouse gets 50% regardless of will - consent required to transfer

Question 34

curtesy and dower (marital property rights)

Answer 34

If property not in co-ownership before death: - law entitles surviving spouse a 1/3 or more right of use of real property owned by other spouse when they die - surviving spouse can use entire property for life - sometimes dower = wife's rights and courtesy = husbands's rights

Question 35

Trusts

Answer 35

used for holding and controlling property on behalf of someone else - trustor conveys title to trustee for benefit of a 3rd party (beneficiary)

Question 36

types of trusts

Answer 36

- living trusts (established while owner is still alive - testamentary trust (via a will after owner's death) - land trust (only real estate, trustor is also beneficiary, tax advantages and veiling identity of beneficiary)

Question 37

LLC

Answer 37

- special type of corp - income passed directly to shareholders and is not taxed at corp level - fewer restrictions

Question 38

General Partnership

Answer 38

- all partners share financial liability for each other | - usually held as tenants in common

Question 39

Limited partnership

Answer 39

- has both general and limited partnerships - limited partners have no say in partnership matters - partner's liability is limited to original investment

Question 40

syndicates

Answer 40

informal usually formed to accomplish one thing not recognized as legal can refer to almost any form of business

Question 41

condiminiums

Answer 41

- can be applied to residential units or office spaces - separate interest in individual units, undivided interest in common areas - residents must follow rules of founder - separate mortgages and taxes for each unit

Question 42

Cooperatives

Answer 42

- owned by a corp w/ residents as shareholders - each receive a proprietary lease on an individual unit + common areas - person who wants to live there buys shares in the corp

Question 43

fee timeshare

Answer 43

specified condominium in a resort setting where numerous co-owners have an undivided interest in a particular unit - eacy co-owner has a specified time each year for which they use it.

Question 44

non-fee timeshares

Answer 44

- no real property co-ownership - only right to use and enjoy property - commonly seen where major resort hotel co sell the right to occupy any of their properties for a specific period of time