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Ownership of Real Property Flashcards

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1
Q

What is fee simple absolute?

A

Fee simple absolute is absolute ownership of indefinite or potentially infinite duration. It is transferable inter vivos, descendible, and devisable.

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2
Q

How is fee simple absolute created?

A

“O to A” or “O to A and his heirs.”

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3
Q

What is the accompanying future interest of fee simple absolute?

A

There is no future interest accompanying fee simple absolute.

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4
Q

What is fee simple determinable?

A

Fee simple determinable is a present possessory estate that terminates immediately upon the happening of the stated event which reverts to the grantor.

It is devisable, descendible, and transferable inter vivos but always subject to the condition.

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5
Q

How is fee simple determinable created?

A

Fee simple determinable is created with durational language such as “O to A so long as . . .” or O to A during . . .”

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6
Q

What is the future interest accompanying fee simple determinable?

A

A possibility of reverter held by the grantor. The possibility of reverter is transferable, descendible, and devisable.

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7
Q

What is fee simple subject to a condition subsequent?

A

Fee simple subject to a condition subsequent is a present possessory estate in which the grantor reserves the right to terminate the estate upon the happening of a certain event.

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8
Q

How is fee simple subject to a condition subsequent created?

A

Fee simple subject to a condition subsequent is created by the use of conditional words such as “on the condition that” or “provided that” and an explicit statement of the grantor’s right to reenter.

“O to A provided that A never serves alcohol on the premises. If A does serve alcohol, then A reserves the right to reenter and retake the premises.”

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9
Q

What is the future interest accompanying fee simple subject to a condition subsequent?

A

The future interest accompanying fee simple subject to a condition subsequent is a right or reentry (aka power of termination).

It is not transferable inter vivos (majority rule), but it is descendible and devisable.

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10
Q

What is fee simple subject to an executory interest?

A

Fee simple subject to an executory interest is a present possessory estate that automatically terminates upon the happening of a future event and passes to a third party rather than the grantor.

It is descendible, devisable, and transferable inter vivos.

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11
Q

How is fee simple subject to an executory interest created?

A

It is created by words creating a future interest in someone other than the grantor, such as “O to A unless A does not finish college, then to B.”

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12
Q

What is the future interest accompanying fee simple subject to an executory interest?

A

The future interest accompanying fee simple subject to an executory interest is an executory interest.

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13
Q

Are words of hope, desire, or intention enough to create a defeasible fee?

A

No, because courts disfavor restrictions on free land use.

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14
Q

Is a restraint on alienation of a fee simple estate valid?

A

An absolute restraint on alienation is not valid. A restraint that has a reasonable, time-limited purpose may be enforceable.

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15
Q

What conditions on a fee simple grant will be struck down?

A

Conditions that violate public policy such as those that penalize marriage or encourage divorce will be struck down.

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16
Q

What is a fee tail?

A

A fee tail is an estate were inheritability of the land is linked to lineal heirs. It is abolished in most places.

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17
Q

What is a life estate?

A

A life estate is a present possessory interest that lasts for the lives of one or more people.

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18
Q

How is a life estate created?

A

A life estate is created by explicit language measuring the grant in lifetime terms, such as “O to A for life.”

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19
Q

What is a life estate pur autre vie?

A

A life estate pur autre vie is a life estate measures by a life other than the grantee’s, such as “O to A for the life of King Charles.”

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20
Q

What is the future interest accompanying a life estate?

A

The future interest is a reversion, if held by the grantor, and a remainder if held by a third party.

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21
Q

What are the rights and obligations of a life tenant?

A

(1) A life tenant is entitled to all ordinary uses and profits from the land.
(2) A life tenant must not commit waste.
(3) A life tenant must preserve the land and structures in a reasonable state of repair.
(4) A life tenant must pay ordinary taxes on the land (limited to the extent of income or profits, or if none, the fair rental value).
(5) A life tenant must pay interest, but not principal, on a mortgage.
(6) A life tenant must pay special short term assessments.

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22
Q

May a future interest holder sue a life tenant?

A

Yes, if the life tenant is committing waste or for reimbursement of payments for money spent performing the life tenant’s obligations.

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23
Q

May a life tenant exploit natural resources?

A

Yes, when necessary for repair or maintenance of the land, the land is suitable only for exploitation, or exploitation is expressly or impliedly allowed by the grantor. Additionally, a life tenant can continue mining in mines that are already open.

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24
Q

Is a life tenant responsible for insuring the premises for the benefit of a future interest holder?

A

No.

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25
Is a life tenant responsible for damages caused by a third party?
No.
26
May a life tenant alter or demolish existing buildings?
No, unless the market value of the future interests is not diminished and (1) the remaindermen do not object, or (2) a substantial and permanent change in the neighborhood has permanently deprived the property of its reasonable productivity or usefulness.
27
What happens if a life tenant renounces the estate?
If a life tenant renounces the life estate, the future interest is generally accelerated to become possessory immediately.
28
What is a reversion?
A reversion is a future interest in a grantor who conveys less than what they own (such as a life estate). It is transferable inter vivos, descendible, and devisable.
29
What is a remainder?
A remainder is a future interest in a third party that becomes possessory on the expiration of the preceding estate such as "O to A for life, then to B."
30
Can a remainder divest the preceding estate?
No.
31
Can a remainder follow a time gap after the preceding estate?
No.
32
What estates may a remainder follow?
A remainder follows an estate of a known, fixed duration such as a life estate or a term of years lease.
33
When is a remainder contingent?
A remainder is contingent when it is created in unborn or unascertained persons or it's subject to a condition precedent, or both.
34
Why is an heir an unascertained person while a person is alive?
Because a person has no heirs until they die, only heirs apparent.
35
What is a condition precedent to a remainder?
A condition precedent is a condition that must be satisfied before the remaindermen have a right to possession, such as "O to A for life, then to B if B graduates from college."
36
What is a vested remainder?
A vested remainder is one that is created in an existing and ascertained person that is not subject to a condition precedent.
37
What is an indefeasibly vested remainder?
An indefeasibly vested remainder is a remainder that is not subject to divestment or diminution (no strings attached).
38
What is a vested remainder subject to total divestment?
A vested remainder subject to total divestment (aka vested remainder subject to complete defeasance) is a future interest that could be cut short by a condition subsequent.
39
What is a vested remainder subject to open?
A vested remainder subject to open is a remainder vested in a class of persons that is certain to become possessory but is subject to diminution by the addition of class members.
40
When is a class gift contingent?
When all class members are unascertained.
41
When does a class close?
A class closes when it is not possible for other members to join. Under the rule of convenience, a class closes when some member of the class can call for distribution (demand possession).
42
What are the exceptions to the rule of convenience?
(1) contrary intent (2) womb rule - if person is in gestation when the class closes, that person is included in the class.
43
Is survival of a class member until the time the class closes required to share in a class gift?
Generally, survival is not required to share in a class gift unless survival was made an express condition, such as "O to A for life, then to her surviving children."
44
What is a shifting executory interest?
A shifting executory interest follows a defeasible fee and cuts short someone other than the grantor.
45
What is a springing executory interest?
A springing executory interest cuts short the interest of the grantor.
46
Are remainders and executory interests transferable, descendible, or devisable?
If the remainder is vested, it is transferable, descendible and devisable. At common law, if the remainder or executory interest was contingent, it was devisable and descendible but not transferable. Today it is also transferable.
47
What is the rule against perpetuities?
The rule of perpetuities provides that certain future interests are void if there is any possibility they will vest more than 21 years after the death of any person alive at the time of the grant has died.
48
Which interests does the rule against perpetuities apply to?
The rule against perpetuities applies to contingent remainders, executory interests, options to purchase, vested remainders subject to open, and rights of first refusal.
49
When does the perpetuities period begin to run?
(1) If the grant is created by will, it runs from the date of the testator's death. (2) If the grant is created by deed, it runs from the date of delivery. (3) If the grant is an irrevocable trust, it runs from the date the trust is created. (4) If the grant is a revocable trust, it runs from the date the trust becomes irrevocable.
50
When does an interest vest?
An interest vests when a present interest becomes possessory or when a future interest is indefeasibly vested or vested subject to total divestment.
51
What is a life in being?
A life in being is someone alive who is connected with the vesting of the interest, unless another life is specified.
52
What future interests are exempt from the rule against perpetuities?
The rule against perpetuities does not apply to any future interest that is held by a grantor, any charity-to-charity transfer, or options to purchase held by the current tenant.
53
What is the consequence of a violation of the rule against perpetuites?
The offending interest is destroyed.
54
When does an executory interest always violate the rule against perpetuities?
An executory interest always violates the rule against perpetuities when there is no time limit in which it must vest, such as "O to A for so long as alcohol not sold on the premises, then to B."
55
When does a gift to an open class violate the rule against perpetuities?
An open class gift violates the rule against perpetuities if it is conditioned on members surviving beyond age 21.
56
What is the "bad-as-to-one, bad-as-to-all" rule?
An entire class gift fails if the interests of any class member vests too remotely.
57
What is a fertile octogenarian?
A person is conclusively presumed capable of having children regardless of age. A few states raise a presumption that women over a certain age are incapable of bearing children.
58
What is an unborn widow?
A person's widow or widower is not ascertained until their death and may not be "in being" at the time of the disposition.
59
What is the effect of an administrative contingency on the rule against perpetuities?
A gift conditioned on an administrative contingency (such as concluding probate) violates the rule against perpetuities.
60
When do options or rights of first refusal violate the rule against perpetuities?
Options and rights of first refusal violate the rule against perpetuities when they are not held by the current tenant and are not personal to the holder (e.g. when they extend to the holders heirs and assigns) because they might be exercised after the perpetuities period.
61
What is a right of first refusal?
A right of first refusal is a contract under which, if a seller received an offer to purchase the property, the holder has the right to purchase the property, usually on the same terms as the offer.
62
What is an option?
An option is a contract that creates in the optionee the right to purchase the property on the terms provided in the contract.
63
What is the modern trend in applying the rule against perpetuities to options and rights of first refusal?
The modern trend is to apply the rule against restraint on alienation rather than the rule against perpetuities.
64
Is a per capita gift a clas gift?
No.
65
What is the wait and see doctrine?
Under wait and see (also called second look) the validity of any suspect future interest is determined on the basis of the facts as they exist a the conclusion of the measuring life.
66
What is USRAP?
The Uniform Statutory Rule Against Perpetuities codifies common law RAP and provides an alternate 90 year vesting period.
67
What is cy pres?
Cy pres allows a court to reform an invalid interest in a way that most closely matches the grantor's intent.
68
What are the types of restraints on alienation?
(1) disabling restraint under which attempted transfers are ineffective (2) forfeiture restraints, under which an attempted transfer invalidates the interest (3) promissory restraint, under which an attempted transfer is a breach of a covenant
69
What restraints on alienation are valid?
Forfeiture and promissory restraints on fee ownership and future interests may be upheld if they are for a limited time and a reasonable purpose. Forfeiture and promissory restraints on a life estate and remainders are valid.
70
What is a joint tenancy?
A joint tenancy is concurrent ownership where two or more people own with the right of survivorship.
71
What is tenancy by the entirety?
Tenancy by the entirety is a marital estate between spouses with a right of survivorship.
72
What is tenancy in common?
Tenancy in common is when two or more people own a property without the right of survivorship.
73
What is a right of survivorship?
A right of survivorship exists when an interest held by one co-tenant passes automatically to the remaining co-tenants upon death by operation of law.
74
Is a joint tenancy transferable, descendible, or devisable?
A joint tenancy is transferable inter vivos but it is not descendible or devisable.
75
How is a joint tenancy created?
A joint tenancy is created by four unities: time, title, identical interests, and the right to possess the whole. Additionally, express words of survivorship are required.
76
What happens if words of survivorship are not included in a purported conveyance to joint tenanys?
A tenancy in common is presumed if words of survivorship are not included.
77
How is a joint tenancy destroyed?
(1) A joint tenant destroys the joint tenancy by selling or transferring her interest (2) A joint tenancy may be destroyed by partition.
78
What are the types of partition?
(1) voluntary agreement (2) partition in kind (3) forced sale
79
What is a partition in kind and when is it used?
A partition in kind is a judicial action physically dividing property. It is used when a parcel has sprawling acreage.
80
What is a forced sale and when is it used?
A forced sale is a judicial action selling the property when it is the best interests of the parties. It is used when the property cannot easily be physically divided.
81
Does a mortgage destroy a joint tenancy?
In most states, no, because a mortgage is a lien on the property. In a minority of states, yes, because a mortgage on an interest is considered to be the equivalent of transferring title to the mortgagee.
82
What happens if a joint tenant murders the other joint tenant?
The joint tenancy is destroyed and the ownership is transformed into tenants in common.
83
How is a tenancy by the entirety created?
In states that recognize it, unless the grant says otherwise, it arises presumptively in a conveyance to spouses.
84
Can one spouse unilaterally encumber a tenancy by the entirety?
No.
85
Can one spouse unilaterally convey a tenancy by the entirety?
No.
86
How is a tenancy by the entirety terminated?
A tenancy by the entirety terminates upon death, divorce, or execution by a creditor of both spouses.
87
How does a tenancy in common arise?
A tenancy in common is presumed in a grant to multiple grantees.
88
What does a cotenant own in a tenancy in common?
Each tenant owns an individual part. Shares are presumed but are not required to be equal.
89
Are shares of a tenancy in common descendible, devisable, and transferable inter vivos?
Yes.
90
How much of a property may each cotenant possess?
Each cotenant has the right to possess all portions of the property and has no right to exclusive possession of any part.
91
What is ouster?
Ouster occurs when one cotenant wrongfully excludes another tenant from possession of the whole or any part of the property.
92
Must a cotenant in possession share profits?
No, if the cotenant is in exclusive possession of the property.
93
Must a cotenant share profits from third parties?
Yes, a cotenant who leases all or part of the premises must account to the other cotenants and pay them their shares of rental income.
94
Can a cotenant acquire title by adverse possession?
No, unless the cotenant has committed ouster.
95
What are a cotenants responsibilities for carrying costs and repairs?
Each cotenant must pay their share of carrying costs and repairs.
96
Must a cotenant pay for improvements?
During the life of a cotenancy, there is no right to contributions for improvements made unilaterally by one cotenant.
97
May a cotenant commit waste?
No, and other cotenants may bring an action if a cotenant does.
98
May a cotenant encumber the interests of other cotenants?
No.
99
What are the types of leaseholds?
(1) tenancy for years (2) periodic tenancy (3) tenancy at will (4) tenancy at sufferance
100
What is the future interest in a leasehold?
The future interest is a reversion held by the landlord.
101
What is a tenancy for years?
A tenancy for years is a tenancy for a fixed, determined period of time.
102
How does a tenancy for years terminate?
A tenancy for years terminates automatically at the termination date.
103
How much notice is required to end a tenancy for years?
None.
104
May a landlord terminate a lease if the tenant breaches a covenant?
Yes, if the landlord has reserved a right of entry.
105
What happens if the tenant fails to pay rent in a tenancy for years?
In most jurisdictions, a landlord may, by statute and even without a right of entry, terminate the lease upon a tenant's failure to pay rent.
106
May a tenant surrender the lease in a tenancy for years?
Yes, if the landlord accepts surrender. If the unexpired lease term remaining is more than 1 year, surrender must be in writing.
107
What is a periodic tenancy?
A periodic tenancy continues for successive intervals until the landlord or tenant gives notice of termination.
108
How is a periodic tenancy created?
A periodic tenancy can be created expressly or by operation of law when a lease has no mention of duration, an oral term of years lease violates the statute of frauds, or a residential landlord hold over a tenant who has wrongfully stayed.
109
How is a periodic tenancy terminated?
Notice must be given. At common law, notice must be at least equal to the length of the period and timed to terminate at the end of a period.
110
How much notice is required in a week-to-week periodic tenancy? Month-to-month? Year-to-Year?
In a week-to-week periodic tenancy, one week's notice is required. In a month-to-month periodic tenancy, one month's notice is required. In a year-to-year periodic tenancy, 6 months was required at common law but majority rule now is 1 month.
111
What is a tenancy at will?
A tenancy at will is a tenancy of no fixed duration. It terminates at the will of the landlord or tenant.
112
How is a tenancy at will created?
It must be created expressly, otherwise it will be treated as an implied periodic tenancy.
113
If a landlord has the power to terminate a tenancy at will, does the tenant have a similar power and vice versa?
If the landlord has the power to terminate a tenancy at will, a similar right will be implied in favor of the tenant. A similar right will not be implied for the landlord if only the tenant has the right to terminate.
114
How much notice is required to terminate a tenancy at will?
Most states require a reasonable time to quit.
115
What events other than notice terminate a tenancy at will?
Death and commission of waste.
116
What is a tenancy at sufferance?
A tenancy at sufferance is created when a tenant wrongfully holds over which permits the landlord to recover rent.
117
How does a tenancy at sufferance terminate?
A tenancy at sufferance terminates when the landlord evicts the tenant or elects to hod the tenant over.
118
Is notice required to terminate a tenancy at sufferance?
No.
119
What is the implied periodic tenancy term for a holdover tenant?
The term is based on how rent is computed. Commercial tenants may have up to a year-to-year implied periodic tenancy. Residential tenancy may have up to a month-to-month implied periodic tenancy.
120
May a landlord raise rent on a holdover tenant?
Yes, if notice of the increase in rent is given to the tenant before the lease expires.
121
When are holdover tenants not subject to implied periodic tenancies?
(1) the tenant remains for only a few hours after termination or leaves a few articles of personal property (2) the delay in vacating is not the tenant's fault
122
Does the landlord tenant relationship terminate for breach of a covenant?
At common law, no. The aggrieved party could sue for damages but the relationship remained. Today, a landlord can terminate for failure to pay rent and a tenant can terminate for breaches of the covenant of quiet enjoyment or the implied warranty of habitability.
123
What is consideration for an option to purchase in a lease?
If the lease contains the option to purchase, the consideration for the lease supports the option.
124
How long does an option to purchase in a lease last?
The option lasts as long as the lease, unless the option provides otherwise.

Property (4 decks)

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