Real Property

Question 1

How to Create a Joint Tenancy - 4 Unities

Answer 1

4 Unities - T-TIP: Joint tenants must take their interests:

T: at the same TIME
T: by the same TITLE (meaning, in the same legal instrument)
I: with IDENTICAL, equal INTERESTS; and
P: with rights to POSSESS the whole

Question 2

At common law, a conveyance of property from O “to O and A as joint tenants with rights of survivorship” creates a _____

Answer 2

Tenancy in common

Not a joint tenancy because the unities of time and title are not present because O acquired his interest first by another instrument

Question 3

When property is held in joint tenancy or tenancy in common, which of the following is not a co-tenant’s right?

Answer 3

Compel contribution for the cost of improvements (although a joint tenant or tenant in common may have a right to compel the contribution from other co-tenants for the cost of necessary repairs, taxes, and payments due on mortgages, she does not have a right to compel contribution for the cost of improvements)

Co-tenant has right to:
- mortgage her interest
- share in rents paid by 3rd parties
- possess the entire estate

Question 4

Joint Tenancy - Mortgages

Answer 4

In most states, a mortgage is lien on title and does not sever a joint tenancy - severance occurs only if the mortgage is foreclosed and the property is sold.

In title theory states, however, the execution of a mortgage does sever a joint tenancy (because, under this minority view, giving a creditor a lien on one’s share is the equivalent of transferring title to that creditor)

When one joint tenant dies, their property passes free and clear to the surviving joint tenant
- so in a lien theory state, if one JT executes a mortgage on the property and later dies, their 1/2 interest passes free and clear of the mortgage to the surviving JT (the mortgage can be held only against the property the deceased JT had - and when they die - the right of survivorship operates to end the deceased JT’s interest and automatically vests in the survivor)

Question 5

Partial Actual Eviction by Landlord

Answer 5

Relieves tenant of the obligation to pay rent for the entire premises, even though the tenant continues in possession of the remainder of the premises

Question 6

Partial Actual Eviction by Paramount Title Holder

Answer 6

Results in an apportionment of rent; i.e., the tenant is liable for the reasonable rental value of the portion that he continues to possess

Question 7

Warranty of Habitability

Answer 7

Under the implied warranty of habitability for residential tenancies, the landlord covenants that the premises are suitable for human residence

Question 8

May a tenant waive the implied warranty of habitability?

Answer 8

NO, because such a waiver is against public policy

Question 9

Implied Covenant of Quiet Enjoyment

Answer 9

Under the implied covenant of quiet enjoyment, the landlord covenants that neither he nor someone with paramount title will interfere with the tenant’s quiet enjoyment and possession of the premises. The covenant may be breached by: total actual eviction, partial actual eviction, or constructive eviction

Question 10

Effect of Landlord Assigning Their Interest

Answer 10

A landlord may assign the rents and reversion interest that he owns

The assignee is liable to the tenants for performance of all covenants made by the original landlord in the lease, provided that those covenants run with the land

The original landlord also remains on all of the covenants he made in the lease (ex: covenant of quiet enjoyment - fill in others)

Question 11

Covenants Against Assignment or Sublease

Answer 11

If a landlord consents to one transfer that violates a covenant against assignment or sublease, he waives his right to avoid future transfers - the landlord may reserve the right to avoid future transfers, but such reservation must take place at the time of granting consent

*A covenant against assignment or sublease is NOT an unreasonable restraint on alienation - all jurisdictions permit and enforce such covenants

A covenant against assignment does NOT prevent the tenant from subleasing her interest - covenants against assignment or sublease are strictly construed against the landlord - thus, a covenant prohibiting assignment does not prohibit subleasing and vice versa

If a tenant transfers his interest in violation of a covenant against assignment or sublease, the transfer is NOT void - however, the landlord usually may terminate the lease under the lease terms or a statute or sue for damages

Question 12

Assignment

Answer 12

A complete transfer of the entire remaining lease term constitutes an assignment of the lease
- if the tenant retains any part of the remaining lease term, other than a right of reentry for breach of the original lease terms, the transfer is a sublease

*Tenancy at will CANNOT be assigned - the attempted assignment is void and and terminates the tenancy at will by operation of law

*A lease creating a tenancy for more than 1 year, including an assignment of an interest in the lease for more than 1 year, must be in writing to satisfy the SOF

Question 13

Easement by Prescription

Answer 13

Acquiring a prescriptive easement is analogous to acquiring property by adverse possession, except that the use need not be exclusive (the user may share the use with the owner or other easement claimants)

The use must be:
(1) Open & notorious
(2) adverse, and
(3) continuous and uninterrupted for the statutory period

Exclusive use is not required

Question 14

If an easement is said to be surcharged, this means:

Answer 14

The easement’s legal scope was exceeded

The holder of an easement has the right to use another’s land (servient tenement) but has no right to possess the land. The scope of the easement is determined by the reasonable intent of the original parties, and when the scope has been specified, these specifics will govern. However, when an easement’s scope has been set out only in general language, courts will interpret it to accommodate the holder’s present and future reasonable needs. In either event, if the easement holder uses the easement in a way that exceeds its legal scope, the easement is surcharged - the servient owner may enjoin the excess use and possibly sue for damages if the land has been harmed.

Question 15

Termination of easement - 8 ways

Answer 15

END CRAMP

(1) Estoppel
(2) Necessity ends
(3) Destruction (involuntary)
(4) Condemnation
(5) Release
(6) Abandonment
(7) Merger
(8) Prescription

Question 16

Easement Implied from Preexisting Use

Answer 16

For the court to imply an easement from preexisting use, it would have to find:
(1) the previous (prior to division) use on the servient part was apparent and continuous, AND
(2) the parties expected that the used would survive devision because it is reasonably necessary to the dominant tenement’s use and enjoyment

Question 17

Implied Equitable Servitude (Reciprocal Negative Servitude)

Answer 17

An equitable servitude is a covenant that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of it.

Generally, equitable servitudes are created by covenants contained in a writing that satisfies the SOF. However, in the absence of a writing, reciprocal negative servitudes may be implied if:
(1) there is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant); and
(2) the grantee had actual, record, or inquiry notice of the covenant

Question 18

Equitable Servitudes Creation

(Requirements for the Burden of an Equitable Servitude to Run to Successors in Interest)

Answer 18

The burden of an equitable servitude will run to successors in interest if: (WITNES)
(1) The original promise was in writing that satisfies the SOF (exception - common scheme)
(2) the covenanting parties intended that successors in interest be bound by the covenant;
(3) the covenant touches and concerns the land (that is, it benefits the covenantor and their successor in their use and enjoyment of the burdened land); and
(4) the successor in interest has notice of the covenant (if they’ve given value);

*A subsequent purchaser for value of land burdened by a covenant is not bound by it in equity unless they had notice of the covenant when they acquired the land
- note that in most states, successors of the burdened land who are not purchasers (for example, donees) are bound by the covenant whether they had notice or not.

Horizontal privity between the original covenanting parties and vertical privity between the covenantor and their successor in interest are NOT required

Question 19

Does the existence of a visible easement that benefits the property render title to the land unmarketable?

Answer 19

NO, a visible easement that benefits the property would not render title to land unmarketable. Most courts hold that a beneficial easement (e.g., a utility easement) that was visible or known to the buyer does not constitute an encumbrance

In contrast, an easement that reduces the value of the property or is unknown to the buyer constitutes an encumbrances that renders title unmarketable

Question 20

Which of the following is true when a seller breaches the implies covenant of marketable title?

(A) the buyer may sue for breach after closing
(B) the seller can obtain specific performance
(C) the closing date may be extended to allow the seller time to cure
(D) rescission is unavailable as a remedy

Answer 20

(C)

When a seller of land breaches the implied covenant of marketable title, the closing date may be extended to allow the seller time to cure
- If the buyer determines that the seller’s title is unmarketable, he must notify the seller and give her a reasonable time to cure, even if this requires extending the closing date, and even if time is of the essence

*When a seller of land breaches the implied covenant of marketable title, rescission IS available as a remedy - if the sellers fails to cure the defects, then the buyer may rescind the contract, sue for damages and breach, and get specific performance with abatement in purchase price.

*When a seller of land breaches the implied covenant of marketable title, the buyer may NOT sue for breach after closing. The implied covenant of marketable title applies at the contract stage of a land sale transaction, before the closing. The closing extinguishes the contract, which is said to merge with the deed. Then, absent fraud, the seller is no longer liable on this implied covenant - the buyer must rely on any assurances in the deed.

Question 21

Adverse Possession Elements

Answer 21

To establish title by adverse possession, the possessor must show:
(1) an actual entry giving exclusive possession that is
(2) open and notorious
(3) adverse (hostile/under a claim of right), and
(4) continuous throughout the statutory period

Question 22

Hostile

Answer 22

The hostility element of adverse possession requires that the possessor lack the true owner’s permission to be on the land (it does not matter whether the possessor believes he is on his own land or knows he is trespassing on someone else’s land)

Question 23

Continuous

Question 24

Open and Notorious

Question 25

Actual and Exclusive

Question 26

For purposes of determining title by adverse possession, when is tacking not available?

Answer 26

Tacking is not available when one adverse claimant ousts the other or the first claimant abandons and the next claimant goes into possession

*Period of adverse possession between two successive claimants may be tacked together to make up the full statutory period if there is privity of possession between the claimants - Privity is satisfied if the first adverse claimant purports to transfer the land to the next (i.e., the subsequent possessor takes by descent, devise, or by deed purporting to convey title)

Question 27

Adverse Possession and Future Interests

Answer 27

The statute of limitations does not run against a holder of a future interest until the interest becomes possessory

Ex: O conveys a life estate to A, with a remainder to B.
If during A’s lifetime, X enters into actual, exclusive possession that is open and notorious and hostile for the statutory period, will X obtain title to the land?

Answer: NO, but X will acquire A’s life estate

Question 28

If an adverse possessor uses land in violation of a recorded real covenant for the limitations period, she:

Answer 28

Takes title free of the real covenant, EVEN IF she had knowledge of it

However, if she complies with the covenant for the statutory period, she takes title subject to the real covenant

Question 29

Constructive Adverse Possession (Actual and Exclusive)

Answer 29

An adverse possessor will gain title only to the land they actually occupy. In some cases, however, actual possession of the entire parcel claimed is not necessary. If an adverse possessor enter under color of title (meaning by invalid deed), she is deemed to be in constructive possession of all the land that the deed describes, as long as she is in actual possession of a reasonable portion of that land

(Possession of a portion of a unitary tract is sufficient adverse possession of the whole if there is a reasonable proportion between the part actually possessed and the whole, and if the possessor has color of title)

Question 30

Adverse Possession - Disabilities

Answer 30

The SOL will not run against the true owner who is afflicted by a disability at the INCEPTION of the adverse possession (meaning, when the cause of action first accrued). Only the disability of the OWNER existing at the time the cause of action arose is considered.

Question 31

Why are junior mortgagees necessary parties?

Answer 31

Because they have the right to pay off the senior mortgage (i.e., redeem it) to avoid being wiped out by foreclosure

Question 32

Statutory Redemption is the right of a mortgagor to recover the land after the foreclosure sale has occurred, usually by paying ____

Answer 32

The foreclosure sale price (rather than the amount of the original debt)

Question 33

Order of Priority for allocating mortgage foreclosure sale proceeds

Answer 33

(1) Expenses of the sale, including attorneys’ fees and court costs
(2) the principal and accrued interest on the foreclosing party’s loan
(3) any junior lienors in the order of their priority
(4) the mortgagor (if surplus)

Question 34

Easement Implied from Prior Use

Answer 34

An easement implied from prior use arises in favor of a grantee when:
(1) two parcels of land are in common ownership;
(2) one of the parcels is conveyed to a grantee;
(3) the parcel conveyed had been receiving a benefit from the parcel retained prior to the conveyance to the grantee;
(4) the usage is reasonably necessary or convenient; and
(5) the usage is apparent

Question 35

The Hold-Over Doctrine

Answer 35

If a tenant continues in possession after their right to possession has ended, the landlord may:
(1) evict the tenant, or
(2) bind the tenant to a new periodic tenancy

The length of the new tenancy generally depends on the way rent was computed under the lease that has ended
- If the rent was computed on a monthly basis, the election created creates a month-to-month periodic tenancy
- if the rent was computed on a quarterly basis though payable monthly, a quarter-to-quarter periodic tenancy is created
- if rent was computed on an annual basis payable monthly, a year-to-year periodic tenancy is created.
No matter how the rent is computed, the maximum tenancy that can be created by the election to hold the tenant over to another term is a year-to-year tenancy.
The various promises made by the LL and the tenant in the original lease become part of the tenancy for the additional term.

Commercial Tenants
- commercial tenants may be held to a new year-to-year periodic tenancy if the original lease term was for one year or more. While, technically, the length of the new tenancy is based on the way rent was computed, if the original term was less than one year, the new tenancy is typically a month-to-month tenancy

How much is the rent going to be?
- if the tenant was notified of a rent increase prior to the original lease expiring, they have to pay that rent increate as a periodic tenant
- on the other hand, if the tenant was not notified of a rent increase prior to the lease expiring, they continue paying what they always paid

Question 36

Void Deeds

Answer 36

(1) Forged deeds
(2) No delivery
(3) Dead or Nonexistent grantee
(4) Deed obtained by fraud in factum (grantor did not know what they were signing)

Question 37

When is lien priority affected by a mortgage modification?

Answer 37

Lien priority can be affected by the modification of the mortgage - when there is both a senior mortgage and a junior mortgage, modifications of the senior mortgage that are DETRIMENTAL to the junior mortgage, such as raising the interest rate or the principal amount, thus making it more burdensome, will give the junior mortgage priority

simply extending the amortization period to reduce the monthly payment amount is not detrimental to junior mortgages

Question 38

Condemnation of Leaseholds

Answer 38

If the ENTIRE leasehold is taken by eminent domain, the tenant’s liability for rent is extinguished because both the leasehold and reversion have merged in the condemnor and there is no longer a leasehold estate. The lessee is entitled to compensation.

However, if the taking is TEMPORARY or PARTIAL, the tenant is NOT discharged from the rent obligation, but is entitled to compensation (that is, a share of the condemnation award) for the taking.

Question 39

Rights of First Refusal (Options to Purchase)

Answer 39

these are subject to a RAP analysis
- if the right of first refusal is held by an ascertainable person, there is no RAP problem
- if it is held by unascertainable people, or for example, to “sister her heirs and assigns”, then it violates the RAP

Question 40

Fixtures

Answer 40

Res/Comm differences

Question 41

Equitable Conversion

Answer 41

….

Question 42

General Warranty Deed

Answer 42

Present Covenants
- don’t run with the land
- breached, if at all, at the time of closing
- *Can only be enforced by the buyer

Future Covenants
- DO run with the land
- enforceable by buyer and all subsequent owners or occupiers of the land*

Question 43

Judgment Lienors / Recording Acts

Answer 43

A majority of courts hold that a judgment lienor is NOT protected by the recording statute.

Most courts reason that either:
(1) a judgment creditor is not a BFP because he did not pay contemporaneous value for the judgment, OR
(2) the judgment attaches only to property “owned” by the debtor, and not to property previously conveyed away, even if that conveyance was not recorded