Real Property

Question 1

Restraint on alienation

Answer 1

When a grantor forbids the sale of land that is being conveyed. Generally, a restraint is void, and the restrictive line item will be struck from the conveyance.

Question 2

Marketable title

Answer 2

Implied in every land sales contract is an implied warranty that at closing the seller will give the buyer marketable title that is reasonably free of defects regardless of the type of deed contemplated in the contract. It need not be perfect, but it should be free from unreasonable risks of litigation involving the property. Purchasers have a duty to report defects to give the seller reasonable time to cure. Marketability challenges must be made before deed transfer, otherwise they will merge into the deed.

Question 3

Tenancy in common

Answer 3

A tenancy in common is a concurrent estate held with no right to survivorship. Tenants can hold different interests in the property, but each is entitled to possession of the whole. Interests are alienable, devisable, and inheritable.

Question 4

Co-tenancy repairs

Answer 4

Each co-tenant is responsible for their fair share of carrying costs (taxes, mortgage interest payments) based upon the undivided share that they hold. A co-tenant that makes repairs is entitled to contribution for reasonable and necessary repairs provided they notified the others of the need.

Question 5

Joint tenancy

Answer 5

A joint tenancy is a conveyance of real property to two or more persons which includes a right of survivorship.

Requires four unities: (1) time, (2) title, (3) interest, and (4) possession.

TTIP

Question 6

Joint tenancy severance

Answer 6

When one joint tenant unilaterally transfers ownership interest, the new tenant takes possession of a tenancy in common. If the remaining interest holders remain, they remain as joint tenants. If a joint tenant takes out a mortgage, in a lien theory jurisdiction the joint tenancy remains intact, however in a title theory jurisdiction the joint tenancy is severed and a tenancy in common results.

Question 7

Tenancy by the entirety

Answer 7

A tenancy by the entirety is a joint tenancy held by a married couple with the right of survivorship. It is only severable by divorce, death, a creditor of both spouses or mutual agreement. Neither spouse alone can convey or encumber this real property interest.

Question 8

Legal possession

Answer 8

Under the American view, the landlord only has the duty to deliver legal possession, not actual possession. English rule – actual possession. The English rule allows a lessee to terminate the lease and recover damages for the breach.

Question 9

Leaseholds

Answer 9

A leasehold provides the tenant with a present possessory interest in real property.

Question 10

Tenancy for years

Answer 10

A leasehold estate for a fixed period of time is known as a tenancy for year. This leasehold automatically terminates at the end of the lease period. A lease longer than a year requires a writing per the statute of frauds.

Question 11

Periodic tenancy

Answer 11

A tenancy that continues for a specified time until terminated by proper notice is a periodic tenancy. Can be created by express agreement or by implication if rent is paid at specific periods, or by law. Requires notice of a full period, excepting a year-to-year tenant who only requires a 6-month notice.

Question 12

Tenancy at will

Answer 12

A tenancy at will is an ongoing leasehold which will continue until terminated by either the tenant or the landlord.

Question 13

Tenancy at sufferance

Answer 13

A tenancy at sufferance occurs when a tenant has wrongfully remained in the property beyond the expiration of the lease.

Question 14

Tenant duties

Answer 14

A tenant’s duties include payment of rent, not commit waste, and not to use the property for illegality. A landlord can terminate the lease or seek injunctive relief in the case of illegality by the tenants.

Question 15

Rental fees

Answer 15

Rental fees earned from third parties must be shared with all joint tenant and tenant in common owners.

Question 16

Ouster

Answer 16

A tenant in common or joint tenant who is denied access to their property has been subjected to ouster. A tenant in common cannot adversely possess an interest in a tenant in common absent ouster.

Question 17

Subleases

Answer 17

A sublease is a transfer of less than the full amount of the lease term to another. A sub-lessee is only in privity with the sub-lessor and is not personally liable to the landlord for rent of for the performance of any of the covenants in the main lease unless the sub-lease expressly assumes the covenants. Someone who leases cannot sublease for longer than their own lease–if they do, the tenant can be ejected.

Question 18

Implied warranty of habitability

Answer 18

Implied in every residential (not commercial) lease, requires the landlord to provide a place to live that is reasonably suitable for inhabitation, including hear, running water, and sewage disposal. If breached, the tenant may (1) move out and terminate the lease, (2) withhold or reduce the rent, (3) repair and deduct from the rent, or (4) remain and sue for damages.

Question 19

Constructive eviction

Answer 19

A constructive eviction can occur as a result of the landlord’s breach of the implied covenant of quiet enjoyment if the landlord substantially interferes with the tenant’s use and enjoyment of the premises by their actions or failure to act to resolve a problem. The breach must cause a loss of substantial use and enjoyment of the premises, and the tenant must give the landlord notice and opportunity to remedy the problem. Once the tenant vacates the premises, the tenant may terminate the lease and seek damages.

Question 20

Self-help

Answer 20

Self-help refers to the actions a landlord takes to eject a tenant from their property. Most states do not allow self-help; the landlord must instead (1) properly serve the tenant with notice of a lawsuit, and (2) obtain a court judgment of possession.

(Tenant doesn’t pay + landlord changes the locks = self-help)

Question 21

Assignment of a lease

Answer 21

Assignment occurs when a tenant transfers all of their remaining interest to a third party. Leases are freely assignable unless prohibited in the lease agreement. Assignee is liable to the landlord for rent and all other covenants that run with the land. The assignor also remains liable based on privity of contract.

Question 22

Assignment clauses

Answer 22

These clauses are valid, but narrowly construed against the landlord. If they know of and don’t object, they effectively waive the clause. If the assignment clause is violated, the landlord accepts the assignment by accepting rent from the new tenant.

Question 23

Real covenants

Answer 23

A real covenant is a non-possessory interest in land, obtained via contract and recorded to establish that it runs with the land. This contract is a formal obligation of the burdened party to either do something or refrain from doing something on the land. Breaches of real covenants are remedied with monetary damages.

Question 24

Enforcing a benefit of a real covenant

Answer 24

Enforcement of a real covenant requires a writing that satisfies the SoF, intent for the covenant to run with the land, vertical privity, and the covenant must touch and concern the land.

Question 25

Enforcing the burden of a real covenant

Answer 25

Same as benefit: the covenant to run with the land, vertical privity, and the covenant must touch and concern the land.

PLUS requires horizontal privity and notice. Notice may be actual, inquiry (revealed during inspection) or constructive (as evidenced via proper recording).

Question 26

Vertical privity

Answer 26

A transfer or rights or burdens between a party that enters a covenant and their successors in ownership.

Question 27

Horizontal privity

Answer 27

The original parties owning the real property that initially agree to enter a real covenant have horizontal privity.

Question 28

Equitable servitudes

Answer 28

An equitable servitude is a covenant enforced by injunction. Enforcement of the benefit requires a writing, intent by the parties to enter the agreement, and it must touch and concern the land. To enforce a burden, all of the above plus notice are required.

Question 29

Easements

Answer 29

An easement is an agreement where a (dominant) party buys the right to use someone else’s land (servient). This agreement must be in writing to satisfy the SoF.

Question 30

Easement in gross

Answer 30

This is an easement that provides use or benefit to a particular person or persons.

Question 31

Easement appurtenant

Answer 31

Appurtenant easements benefit any successive owner’s enjoyment and use of the land. As opposed to easements in gross, these do attach to the land. Burdening easements pass to subsequent owners as long as the new owner has notice.

Question 32

Easement creation

Answer 32

An easement can be created via an express grant, implication, necessity, or prescription.

Question 33

Easement by express grant

Answer 33

An easement is created by express grant when it is in a valid, signed writing, which details the conveyance of the right to the dominant party.

Question 34

Easement by implication

Answer 34

An easement by implication is created when a single tract of land is divided and the previous owner established use. The easement must affect the value of the land and when initially created it was not intended to be temporary.

Question 35

Easement by necessity

Answer 35

An easement by necessity is created when a single owner subdivides their property and access to the property would be impossible without the usage of the easement. Once the necessity is no longer needed, the easement is rescinded.

Question 36

Easement by prescription

Answer 36

An easement by prescription is created in a similar manner as an adverse possession (less exclusivity), where the possessor’s use is open and notorious, continuous, hostile, and the duration of the statutory period.

Question 37

Waste

Answer 37

Affirmative waste is voluntary waste, permissive waste is through neglect, and ameliorative waste can be affected via improvements to the land that do not benefit later landowners.

Question 38

Fixtures

Answer 38

A fixture is chattel attached to the land, thereby converting it from personal property to fixture. Fixtures that can be removed from the land without causing damage and trade equipment are typically exceptions.

Question 39

Termination of an easement

Answer 39

An easement is terminated through non-use, abandonment (also requires a physical act), agreement, merger, or end of necessity.

Question 40

Transfer of an easement

Answer 40

An easement appurtenant is transferred when real property encumbered with an easement is transferred to a new owner. The burden and benefit convey as well, but subject to the recording statute.

Question 41

Affirmative/negative easement

Answer 41

An affirmative easement allows the holder to affirmatively use another’s land. A negative easement allows the holder to compel the owner not to use land in a particular way.

Question 42

Easement relocation

Answer 42

An easement appurtenant cannot be moved if its location was already reasonably decided. After the easement is created, the reason for location selection is irrelevant.

(Look for MBE question relating to access road that is no longer in a helpful place)

Question 43

Easement maintenance

Answer 43

An easement holder is required to make any necessary repairs to the easement. If the land is damaged by the holder, they are responsible for repair.

Question 44

Profit

Answer 44

A profit is an agreement that entitles its holder to enter the servient estate to extract resources, such as timber, oil, or quarried material.

Question 45

License

Answer 45

A license is a permission to enter another’s land for some identified, narrow purpose. A license need not be in writing and is freely revocable at the will of the licensor, unless estoppel applies to bar revocation.

Question 46

Recording statutes

Answer 46

A recording statute allows for documentation of transfer of real property ownership and provides guidance for the ownership of a parcel of property that has been transferred to multiple parties. There are three types of recording statutes: race, notice, and race-notice.

Question 47

Race recording statute

Answer 47

In a race jurisdiction, the owner is whomever records first.

Question 48

Notice recording statute

Answer 48

Any subsequent bonafide purchased that provides notice of ownership first will own the property when a previous purchased failed to record.

Question 49

Race-notice recording statute

Answer 49

A subsequent bonafide purchased prevails over a prior grantee if, and only if, the subsequent purchased did not know of the earlier transfer AND the subsequent purchaser’s deed was recorded before the first purchaser’s deed.

Question 50

Bonafide purchaser

Answer 50

A purchaser who purchases real property for some value that is not aware of some defect in ownership of the property. As a BFP, as long as they record the purchase of the property, they will likely gain good title, despite no-notice third-party challenges of ownership.

Question 51

Shelter rule

Answer 51

A grantee is protected by their BFP grantor. This rule was established to protect donees and devisees that did not take the property for consideration.

Question 52

Notice to a purchaser

Answer 52

A purchaser can receive notice by three methods: actual, inquiry, or record. (AIR)

Actual requires personal knowledge from any source, most often by inspection of the property and observing conditions on the land.

Inquiry notice is gained during a required and reasonable inspection.

Record notice is affected when the deed is properly recorded.

Question 53

Doctrine of merger

Answer 53

Obligations contained in the contract, such as seller’s duty to deliver marketable title, merge into the deed and cannot thereafter be enforced unless the deed contains the obligation.

Question 54

Warranties

Answer 54

General warranty deeds contain three present covenants: seisin, right to convey, and covenant against encumbrances.

And three future covenants: quiet enjoyment, warranty, and further assurances.

Present = SCE, Future = QWA

Question 55

Seisin (present warranty)

Answer 55

The grantor warrants that they own the estate they now claim to convey.

Question 56

Right to convey (present warranty)

Answer 56

The grantor promises that they have the authority to make the conveyance.

Question 57

Covenant against encumbrances (present warranty

Answer 57

The grantor promises that there are no non-possessory interests, servitudes, or mortgages on the land other than those previously disclosed.

Question 58

Quiet enjoyment (future warranty)

Answer 58

A promise that the grantee won’t be disturbed in possession by third-party’s lawful title claim.

Question 59

Warranty (future warranty)

Answer 59

A promise to defend the grantee if lawful claims of title asserted by others arise.

Question 60

Further assurances (future warranty)

Answer 60

A grantor promises to correct any future problems and do what is reasonably necessary to perfect the title conveyed.

Question 61

Quitclaim deed

Answer 61

A deed that offers no warranties or assurances, and only passes whatever rights the seller has – even if the seller has no rights at all.

Question 62

Special warranty deed

Answer 62

A special warranty deed covenants against title defects the grantor themselves create rather than all defects by prior owners.

Question 63

Breach of warranty against encumbrances

Answer 63

If an encumbrance is found to exist after the sale, damages are equal to the difference in value of the property due to the encumbrance.

Question 64

Adverse possession

Answer 64

Adverse possession allows someone in possession of land owned by another to acquire title if possession is (1) continuous, (2) hostile, (3) open and notorious, (4) exclusive, and (5) they actually possess the land.

Hostile = owner did not grant permission
Open = AP used the land as a normal owner would
Exclusive = only possessor, not shared with owner

If the adverse possessor rents out the land, tenants do not break the exclusivity.

Question 65

Rule against perpetuities

Answer 65

This rule invalidates any interest in property if there is any chance the interest may vest more than 21 years after a measuring life in being at the creation of the interest.

Only applies to:
- Contingent remainders
- Executory interests
- Class gifts
- Rights of first refusal if they are contract or covenant rights

Question 66

Life tenant responsibilities

Answer 66

A life tenant has a duty not to waste the land. A future interest holder may sue for damages or enjoin such acts. If they fail to keep the property in repair, pay taxes, or pay interest on the mortgage, they are committing waste. They do not, however, need to pay the mortgage, which is the responsibility of the remainderman. Income produced on the land is the sole property of the life tenant, however, if the land is vacant and unproductive, a life tenant is not required to pay taxes.

Question 67

Fee simple mineral rights

Answer 67

If a grantee holds land in fee simple, they have a right to remove minerals. Only a life tenant has to account to future interest holders regarding the removal of minerals.

Question 68

Subject to mortgage

Answer 68

If the mortgagor sells the property and conveys a deed, a grantee takes subject to mortgage which remains on the land. The grantee can sign an assumption agreement, promising to pay the mortgage loan. If so, they become primarily liable to the mortgagee as a surety. Mortgagee can then go after either party to get the mortgage repaid. The mortgagor will always be personally liable on the mortgage, only subsequent grantees who assume the mortgage will be personally liable, and all subsequent grantees, whether they assume the mortgage or not, can lose the property if it is foreclosed upon for the mortgage default.

Question 69

Foreclosure

Answer 69

Upon foreclosure, the mortgagor’s interest in the property is terminated. The priority of a mortgage is determined by the time it was placed on the property. A foreclosure will terminate interests junior to the mortgage being foreclosed. If proceeds from the foreclosure sale are insufficient, foreclosed unpaid parties will then seek a deficiency judgment.

Question 70

Deed conveyance

Answer 70

Requires lawful execution, delivery, and acceptance. Lawful execution requires the deed be in writing, identify the parties, be signed by the grantor and provide an adequate property description. For delivery to be valid, the grantor must demonstrate a present intent to transfer the interest – physical transfer is not required.

Question 71

Fair Housing Act

Answer 71

It is unlawful to refuse to sell or rent due to race, color, religion, sex, familial status, or origin. The act also prohibits discriminatory terms of sale, or discriminatory advertisement. Exceptions exist for religious organizations, private clubs, or apartment buildings with four or less units when the owner occupies one unit. Here, the owner can discriminate, however cannot advertise preference.

Question 72

Land sale contracts

Answer 72

Require a writing, identifying the parties, signed by the party to be bound, description of the land or parcel, and state the consideration.

Question 73

Zoning

Answer 73

Zoning laws enforce land usage based upon city planning, where land is assigned to residential, commercial, or industrial use. They are enforced by state or local government police power and seek to control land use for the protection of the health, safety, morality and welfare of citizens.

Question 74

Non-conforming use

Answer 74

Allows a landowner to continue to use his land despite a change in zoning that makes the present usage illegal. Requires the previous use to be legal, that there be no break in continuous use, and the use is not substantially increased.

Question 75

Variance

Answer 75

A property owner may obtain a zoning variance if the new zoning law imposes an undue hardship and the variance will not be contrary to the public safety.

Question 76

Spot zoning

Answer 76

If a zoning amendment confers a special benefit on a small land parcel regardless of public interest, it is generally invalid.

Question 77

Dedication

Answer 77

A dedication is a donation of land or creation of an easement for public use. These dedications can be express or implied, and are typically associated with housing subdivisions, where a map or plan has been approved and recorded.

Question 78

Lateral support / subjacent support

Answer 78

Every landowner is entitled to lateral support of their soil (or subjacent support), in its natural condition, from adjoining land. Neighbors will be found strictly liable for excavating and causing neighboring property to crumble under its own weight. If the plaintiff’s land has a structure that is damaged and the weight of the structure liability contributed to the land collapse, liability will be attached only if the plaintiff can prove negligence.