Real Property Flashcards
Freehold Estates (Three Categories)
(1) Fee Simple Absolute
(2) Defeasible Fees - 3
(3) Life Estate
Freehold Estates - General QTNA
- What language will create the estate?
- Once identified, what are the estate’s distinguishing characteristics? In other words, is the estate devisable, meaning, can it pass by will? Is the estate
descendible, meaning, will it pass by the statutes
of intestacy if its holder dies intestate (without a
will)? Is the estate alienable, meaning, is it transferable inter vivos, or during the holder’s lifetime? - Which future interests, if any, is the estate capable
of?
Fee Simple Absolute (General)
Rule: A fee simple absolute is absolute ownership of potentially infinite duration. It is freely alienable, devisable,
and descendible.
Language: “To A” or “To A and his heirs.”
Note: Today, common
law words “and his heirs” are not needed. PLUS living person has no heirs
Defeasible Fees - “Capable of Forfeiture”
- To be defeasible
means to be capable of forfeiture - Think of these as three types of fee simple (“to A”) with a catch or condition attached that renders the estate subject to the risk of forfeiture
Defeasible Fees - Fee Simple Determinable
Rule: This estate, like all of the defeasible fees, is devisable,
descendible, and alienable, but always subject to the
condition.
Language: To A so long as . . .” “To A during . . .” “To A until . . .”
- Look for clear durational language
Note: Accompanying future interest = possibility of reverter FSDPOR (Frank Sinatra Doesn’t Prefer Orville Redenbacker)
Defeasible Fees - Fee Simple Determinable’s Accompanying Future Interest
Rule: Only one future interest accompanies the fee simple determinable, Possibility of Reverter (for grantor) - FSDPOR
Defeasible Fees - Present Possessory Fee Simple Subject to Condition Subsequent
Rule: This estate is NOT automatically terminated, but it can be cut short at the grantor’s prerogative if a stated condition occurs.
Requirements:
(1) Clear durational language
(2) Clear statement of the right of reentry
Accompanying future interest = right of reentry synonymous with the power of termination
Language: “To A, but if X event occurs, grantor reserves the right
to re-enter and retake.”
Defeasible Fees - Fee Simple Subject to Condition Subsequent Accompanying Future Interest
Accompanying Future Interest = right of reentry synonymous with the power of termination
Defeasible Fees - Fee Simple Subject to Executory Limitation
Rule: This estate is just like the fee simple determinable,
only now, if the condition is broken, the estate is
automatically forfeited in favor of someone other
than the grantor.
Language: “To A, but if X event occurs, then to B.”
Subject to shifting executory interest
Accompanying Future Interest for Grantor = shifting executory interest
Covenants - Restrictive Covenants
Rule: Restrictive covenants control how an individual uses their land
Two Types:
(1) Real Covenants
(2) Equitable Servitude
Note: If suing for damages = real covenant issue
If suing for injunction or equitable relief = equitable servitude issue
Real Covenants
Rule:
Note: Need to prove privity
Equitable Servitude
Rule:
Note: Need (1) intent (2) notice and (3) touch and concern
Rule Against Perpetuities (Quick Application)
Ask: “Is it possible that, 21 years after every party in the grant dies, one of the interests will vest? If so, it violates the RAP.”
Note: Only applicable to (1)executory interests,
(2) contingent remainders, and
(3) vested remainders subject to partial divestment (i.e., class gifts)
When a grant violates the RAP, you strike out the future interest, and the current interest becomes a Fee Simple Determinable, and the grantor gets a POR (possibility of reverter)
Co-Tenancy
Grantor or transferor conveys a property to multiple owners at the same time
Tenancy in Common
Default estate created by a conveyance of real property to multiple owners at the same time
Language: (To A & B)
At Death: Granted to whoever they want
Joint Tenancy
Rule: JT is a conveyance of real property to 2+ people that is distinguished by a right of survivorship (surviving JT takes the deceased tenant’s property interest automatically)
At Death: No right to decide who receives interest. B as a joint tenant has a right of survivorship
Created by:
(1) grantor makes a clear expression of intent to create a JT using survivorship (“and”)
(2) Four Unities - Common Law
(i) time (interests vested at the same time),
(ii) title (interests acquired by the same instrument), (iii) interest (interests of the same type and duration), and
(iv) possession (interests give identical rights to enjoyment)
Note: If these four unities are not present, a joint tenancy cannot be created at common law. Instead, a tenancy in common results
Concurrent Ownership - Tenancy in Common
Rule: A tenancy in common is a concurrent estate with no right of survivorship
Language: At common law, a conveyance of property from O “to O and A as joint tenants with right of survivorship” creates a tenancy in common
Concurrent Ownership - Tenancy by the Entirety
Rule: A tenancy by the entirety is a marital estate akin to a joint tenancy in that four unities (plus a fifth-marriage) are required for its creation, and the surviving spouse has the right of survivorship
Four Unities:
(i) time (interests vested at the same time),
(ii) title (interests acquired by the same instrument), (iii) interest (interests of the same type and duration), and
(iv) possession (interests give identical rights to enjoyment)
Devisable
Rule: If an estate is divisible, it can pass by will
Descendible
Rule: If an estate is descendible, it will pass by statutes of intestacy if its holder dies intestate (without a will)
Alienable
Rule: If an estate is alienable, it is transferable inter vivos (during the holder’s lifetime)
Defeasible Fees - Rules of Construction
- Rule: Courts will not find a defeasible fee unless CLEAR DURATIONAL LANGUAGE is used. Words of desire, hope or mere intention are insufficient to create defeasible fees
Ex. “for the purpose of..” “with the hope that..”
- Rule: Absolute restraints on alienation are void. An absolute restraint on alienation is an absolute
ban on the power to sell or transfer, that is not
linked to any reasonable time-limited purpose.
Present Estates - Life Estate
Rule: Life estate is an estate that must be measured in explicit lifetime terms, and never in terms of years
Language: “to A for life”
Future Interest: Reversion (if held by grantor) Remainder (if held by third party)
Measured by life of transferee or by some other life (pur autre vie)
Life Estate Pur Autre Vie
Rule: A life estate measured by a life other than the grantee’s
Doctrine of Waste - Life Tenant
Rule: The life tenant is entitled to all ordinary uses and profits from the land, and the life tenant must not commit waste
Waste Types (Three)
- Voluntary (Affirmative) Waste
- Permissive Waste (Neglect)
- Ameliorative Waste
Waste - Voluntary (Affirmative) Waste
Rule: Voluntary waste (also known as affirmative waste) is actual, overt conduct that causes a drop in value
Waste - Permissive Waste (Neglect)
Rule: Permissive waste occurs when land is allowed to fall into disrepair or the life tenant fails to reasonably protect the land (synonymous with neglect)
• Permissive waste and the obligation to repair: The life tenant must simply maintain
the premises in reasonably good repair.
• Permissive waste and the obligation to pay all ordinary taxes: The life tenant must
pay all ordinary taxes on the land, to the extent of any income or profits that the life
tenant is reaping from the land. If there is no income or profit, the life tenant is required to pay all ordinary taxes only to the extent
of the premises’ fair rental value.
Note: When no income or profits are coming in from the land, the life tenant’s tax
liability for the parcel will be computed not on the basis of the fair market value
but instead on the basis of its mere fair rental value (a considerably lesser sum).
Waste - Ameliorative Waste
Rule: The life tenant must not engage in acts that will enhance the property’s value, unless all future interest holders are known and consent.
Why: Property law honors the future interest holders’ reasonable expectations and sentimental value.
Future Interests - Retained by the Grantor (3)
- The Possibility of Reverter: Fee simple determinable
- The Right of Entry (Power of Termination): Fee simple subject to condition subsequent
- Reversion: A reversion is the future interest that arises in a grantor who transfers an estate of lesser duration than she started with
Future Interests - In Transferees (3)
- Contingent Remainder
- Vested Remainder:
(i) indefeasibly vested remainder, (ii) vested remainder subject to complete defeasance
(also known as the vested remainder subject to
total divestment), and (iii) vested remainder
subject to open - Executory Interest:
(i) shifting (ii) springing
Remainder
Rule: A remainder is a future interest created in a grantee that is capable of becoming possessory upon the expiration of a prior possessory estate created in the same conveyance in which the remainder is created. Either contingent or vested.
Note: Never cuts short or divests the prior taker
Contingent Remainder
Rule: A remainder is contingent if: (1) it is created in an unascertained or unknown person or (2) it is subject to an unmet condition precedent, or both (A condition is a condition precedent when it appears
before the language creating the remainder or is woven into the grant to the remainder)
Vested Remainder
Rule: A remainder is vested when it is created in a known taker who is not subject to a condition precedent
(i) indefeasibly vested remainder
(ii) vested remainder subject to complete defeasance
(also known as the vested remainder subject to
total divestment)
(iii) vested remainder
subject to open
Indefeasibly Vested Remainder
Rule: The holder of an indefeasibly vested remainder is certain to acquire an estate in the future, with no strings or conditions attached
Vested Remainder Subject to Complete Defeasance (Vested Remainder Subject
to Total Divestment)
Rule: Here, remainders exist, and the taking is NOT subject to any condition precedent. However, this right to possession could be cut short because of a condition subsequent
Note: It is important to know the difference between
a condition precedent, which creates a contingent
remainder, and a condition subsequent, which creates
a vested remainder subject to complete defeasance.
To tell the difference, apply the “Comma Rule”
Comma Rule (applicable to Vested Remainder Subject to Complete Defeasance)
Rule: “Comma Rule”: When
conditional language in a transfer follows language
that, taken alone and set off by commas, would create a vested remainder, the condition is a condition subsequent, and you have a vested remainder subject
to complete defeasance
Vested Remainder Subject to Open
Rule: The remainder is vested in a group of takers, at least one of whom is qualified to take possession. But each class member’s share could get smaller because additional takers, not yet ascertained, can still join the class
Rule of Convenience (applicable to Vested Remainder Subject to Open)
Rule: Common law, class closes whenever any member is within its rights to demand possession
Open Class: Members may still join
Closed Class: Members may no longer join, or not possible
Note: Womb Rule: A child of the womb (aka pregnant/ in womb at time of supposed transfer) then they are able to become a part of the class
Executory Interest
Rule: An executory interest is a future interest created in a transferee (a third party), which is not a remainder because it takes effect by either cutting short some interest in another person (“shifting”) or in the grantor or his heirs (“springing”)
Shifting Executory Interest
Rule: A shifting executory interest always follows a defeasible fee and cuts short someone other than the grantor
Springing Executory Interest
Rule: A springing executory interest cuts short the interest of the grantor
Rule Against Perpetuities (Barbri)
Rule: Certain kinds of future interests are void if there is
any possibility, however remote, that the given interest could vest more than 21 years after the death of a measuring life
Note: RAP potentially applies only to contingent remainders, executory interests, and certain vested remainders subject to open
Does NOT apply to Grantor future interests, indefeasibly vested remainder or vr subject to complete defeasance
Four-Step Technique for Assessing RAP Problems
- Determine which future interests have been created by the conveyance
- Determine what has to happen for the future
interest holder to take - Look for the Measuring Life: people alive at the date of the conveyance whose lives and/or deaths are relevant to what has to happen for the future interest holder to
take - Determine whether we will know for sure within 21 years of the DEATH of a measuring life if the future interest holder(s) can take
- if so, conveyance is good
- if not, the future interest is void
Bright Line Rule of Common Law RAP
Rule: An executory interest with no limit on the time within which it must vest violates the RAP
Reform of the RAP
(i) “Wait and See” or “Second Look” Doctrine: Under this majority reform effort, the validity of any suspect future interest is determined on the basis of the facts as they now exist, at the conclusion of our
measuring life
(ii) The Uniform Statutory Rule Against Perpetuities
(USRAP): Codifies the common law RAP and, in addition, provides for an alternative 90-year vesting period
(iii) Cy Pres Doctrine** (“As Near As Possible”): If a given disposition violates the rule, a court may reform it in a way that most closely matches the grantor’s intent, while still complying with the rule against perpetuities. Both reform measures apply cy pres.
Adverse Possession
Basic Concept: Possession for a statutorily prescribed period of time can, if certain elements are met, ripen into title
Note: Note: Possessor’s subjective state of mind is irrelevant. It does not matter, for example, that the possessor actually thought that he was on his own land or knew that he was encroaching on another’s land
Elements of Adverse Possession
COAH (can one adversely habitate) C - Continuous O - Open and Notorious A - Actual and exclusive H - Hostile
Tacking
Rule: One adverse possessor may tack on to his time with
the land his predecessor’s time, so long as there is
privity between the possessors
Privity - satisfied by any non-hostile nexus, such as a
contract, deed, or will
By contrast, privity is absent when the possessor
acquires possession by ousting his predecessor in
possession
- ouster defeats privity
Disabilities
Rule: The statute of limitations will not run against a true owner who is afflicted by a disability at the inception of the adverse possession
ex. insanity, coma, imprisonment
Concurrent Estates
General: Three forms of concurrent ownership
(i) Joint Tenancy
(ii) Tenancy by the Entirety
(iii) Tenancy in Common
Joint Tenancy
General: Two or more own with the right of survivorship, goes automatically to the surviving tenant
Distinguishing:
- Right of Survivorship
- Alienable
- Not Devisable or Descendible
Tenancy by the Entirety
General: A protected marital interest between spouses with the right of survivorship
Tenancy in Common
General: Two or more own without the right of survivorship
How to Create a Joint Tenancy - Four Unities (T-TIP)
Rule: Joint tenants must take their interests:
T - Time: must take at the same time
T - Title: must take by the same title (i.e. deed, will, etc.)
I - Identical Shares
P - Possess: must have rights to possess and enjoy the whole
Note: Clear expression of right of survivorship required
Severance of a Joint Tenancy
SAP: Severance - Sale and Partition
Severance and Sale - Joint Tenancy
Rule: Severance and Sale - A joint tenant may sell or transfer her interest
during her lifetime, without informing the other joint tenants (remains intact as to other members, but new member is a tenant in common)
- if one dies, share goes to the other joint tenant
Severance and Partition - Joint Tenancy
Three Types:
(i) By voluntary agreement: An allowable and
peaceful way to end the relationship
(ii) Partition in kind: A judicial action for a physical
division of the property, if in the best interests
of all parties.
When would a partition in kind work best?
- when sprawling acreage, i.e. farm or vineyard
(iii) Forced sale: A judicial action when, in the best
interests of all parties, the land is sold and the
sale proceeds are divided up proportionately.
When would a forced sale work best?
- when it is a home or single building
Tenancy by the Entirety
General: It can be created only between married partners, who
take as fictitious “one person” with the right of survivorship
How Created: In states that recognize the tenancy by the entirety, it arises presumptively in any conveyance to married
partners unless the language of the grant clearly indicates otherwise
Remember: Can’t Touch This - very protected form of co-ownership
Creditors: Creditors of only one spouse cannot touch
this tenancy for satisfaction of the debt
Unilateral conveyance: One spouse, acting alone,
cannot defeat the right of survivorship by unilaterally
conveying to a third party
Tenancy in Common
General:
- Each co-tenant owns an individual part, and each
has a right to possess the whole
- Each interest is devisable, descendible, and alienable.
Note: No survivorship rights
Rights and Duties of Co-Tenants - Possession
Rule: All parties must be able to enjoy the whole property, or otherwise qualified as ouster, an actionable wrong
Rights and Duties of Co-Tenants - Rent from Co-Tenant in Exclusive Possession
Rule: Absent ouster, a co-tenant in exclusive possession
is not liable to the other co-tenants for rent
Rights and Duties of Co-Tenants - Rent from Third Parties
Rule: A co-tenant who leases all or part of the premises to
a third party must account to his co-tenants, providing
them their fair share of the rental income
Rights and Duties of Co-Tenants - Adverse Possession
Rule: Unless he has ousted the other co-tenant, the cotenant in exclusive possession for the statutory adverse possession period cannot acquire title to the
whole to the exclusion of the other co-tenant
Why: Does not meet the hostility requirement
Rights and Duties of Co-Tenants - Carryi
Rule: Each party pays their “fair share” i.e. percentage owned. Refers to taxes and mortgage interest payments
Rights and Duties of Co-Tenants - Repairs
Rule: The repairing co-tenant enjoys a right to contribution during the life of the co-tenancy for reasonable,
necessary repairs, provided he gave notice to the other
co-tenant(s) of the need for the repairs
Note: Split by “fair share”
Rights and Duties of Co-Tenants - Improvements
Rule: During the life of the co-tenancy there is no right
to contribution for “improvements” made by one cotenant
At Partition: Improver gets a credit equal to any value enhancement of unilateral change (or deduction equal to value decrease of change)
Rights and Duties of Co-Tenants - Waste
Rule: A co-tenant must not commit waste. During the life of the co-tenancy, a co-tenant is permitted to bring an action for waste against another co-tenant
Voluntary (Destruction)
Permissive (Neglect)
Ameliorative (Unilateral change, even if increase)
Rights and Duties of Co-Tenants - Partition
Rule: A joint tenant or tenant in common has a right to bring an action for partition
(i) voluntary agreement
(ii) partition in kind
(iii) forced sale
Landlord and Tenant Law: Leasehold/ Nonfreehold Estates
(Four Types)
- The tenancy for years
- The periodic tenancy
- The tenancy at will
- The tenancy at sufferance
Tenancy for Years
Rule: This lease, also known as the estate for years or term of years, is for a fixed, determined period of time
No notice to terminate required, note above 1 year needs to be in writing (SOF)
Periodic Tenancy
Rule: This is a lease which continues for successive intervals until given proper notice of termination
Creation:
(i) Expressly
(ii) By Implication
- land leased w/ no mention of duration
- oral term of years (in violation of SOF) measured by the way rent is tendered
- holdover in a residential lease, when tenant wrongfully stays on past the conclusion of the original lease
Termination:
Rule: Absent statutory language, notice in writing usually must be given, at least equal to a given interval or period itself
Termination Note: Six months at common law, but one month under the Restatement**
Additional Note: By private agreement, the parties may lengthen or shorten these common-law prescribed notice provisions
Tenancy at Will
Rule: This is a tenancy of no fixed period of duration
Language: “To T for as long as L or T desires.”
Creation: Unless the parties expressly agree to a tenancy at will, the payment of regular rent will cause a court to treat the tenancy as an implied periodic tenancy
Termination: In theory, a tenancy at will can be terminated by either party at any time. Yet today, a reasonable demand to quit the premises is typically required
Tenancy at Sufferance
Creation: It is created when T has wrongfully held over, past the expiration of the lease. We give this wrongdoer a leasehold estate (the tenancy at sufferance), to permit
L to recover rent.
Termination: The tenancy at sufferance is short-lived. It lasts only until L either evicts T or elects to hold T to a new tenancy.
Tenant’s Duties
General: Two duties of tenant’s (i) duty to repair and (ii) duty to pay rent
Tenant’s Duty to Repair - When Lease is Silent
Rule: T need only maintain the premises, not responsible for normal wear and tear
Tenant’s Duty to Repair - When Lease is Silent (Waste)
Rule: T Must Not Commit Waste
(i) voluntary
(ii) permissive
(iii) ameliorative
Tenant’s Duty to Repair - When Lease is Silent (Law of Fixtures)
Rule: When a tenant removes a fixture, liable for voluntary waste (related to doctrine of waste)
Note: Fixture - A fixture is a once movable chattel that, by virtue of its annexation to
realty, objectively shows the intent to permanently
improve the realty
Note: This means that if what T installed amounts to a fixture, T must not remove it
Tenant’s Duty to Repair - When Lease is Silent (Law of Fixtures) - Is it a Fixture?
Two Ways to Tell:
There are two ways to tell.
1. Express agreement controls - what is in the lease described as fixtures
- If no express agreement on point, T may remove a chattel that she has installed so long as removal does not cause substantial harm to the premises
Note: If removal will cause substantial damage to
the premises, then in objective judgment T has
shown the intention to install a fixture. Thus, it must
stay put.
Remember: Fixtures pass with ownership of the
land. If T removes a fixture, she is liable for voluntary waste.
Tenant’s Duty to Repair - Express Agreement in Lease
(to Maintain Property in
Good Condition for Duration of the Lease)
Note: At common law, historically, T was responsible for any
loss to the property, including loss attributable to force of nature, such as tornado, earthquake, hurricane, etc.
Majority View: T may end the lease when the premises are destroyed without T’s fault
Tenant’s Duty to Pay Rent
- T Breaches the Duty to Pay Rent and is in
Possession of the Premises
Options: (i) Evict through the courts or (ii) Continue the relationship and sue for the monies owed
Note: In eviction, tenant is a tenant at sufferance
Self-Help: Landlord must not engage in self-help i.e. changing the locks, forcible removal, removal of possessions, etc.
- Self-help is flatly outlawed and is punishable civilly and
criminally