Real Property Flashcards
(99 cards)
1
Q
What is a mortgage
A
Security interest in real property held by lender as security for a debt. Transfer of an interest in land/real property from owner to mortgage lender that will be terminated when terms of mortgage have been performed.
2
Q
What is foreclosure?
A
Process by which mortgagor’s interest in property is terminated and property is sold to satisfy debt in whole/inpart. Priority is determined by time it was placed on property.
3
Q
Priority During Foreclosure
A
- Foreclosure will terminate interests junior to mortgage being foreclosed but won’t affect senior.
- If lien senior to that of the mortgagee is in default, junior mortgagee has right to pay it off to avoid being wiped out by its foreclosure.
4
Q
How are proceeds from foreclosure sale used?
A
- First, pay expenses of sale, atty fees, court costs
- Pay principal and accrued interest on loan that as foreclosed
- Pay off junior liens/junior interest in order of priority
- Surplus proceeds to mortgagor
- If funds of sale are insufficient to satisfy mortgage debt, mortgagee can bring personal action against debtor/mortgagor for deficiency.
5
Q
Recording Statutes
A
Notice Statute - subsequent bona fide purchaser (person who gives valuable consideration and has no notice of prior instrument) prevails over prior grantee who failed to record.
Race-Notice Statute - subsequent BFP is protect if she records before prior grantee. (“without notice”/”first recorded”)
Pure Race Statute - first to record wins
6
Q
Bona Fide Purchasers
A
Prevail against prior transferee under notice and race-notice statutes. 3 Elements
1. Be a purchaser
2. take without notice of prior instrument
3. pay valuable consideration
7
Q
Rule for Judgment Liens
A
Majority:
Plaintiff who obtains judgment lien isn’t protected by any recording acts from prior unrecorded conveyance made by the defendant. B/c plaintif isn’t BFP since he didn’t pay value for judgment or judgment attaches only to property owned by the def and not property the def previously conveyed away, even if that conveyance wasn’t recorded.
8
Q
Transfer of Right to Use Easement
A
Holder has easement has right to use tract of land for special purpose, but not to possess/enjoy it. Person who gave easement can’t interfere with right of special use.
Easement appurtenant is one that benefits the dominant estate and runs with the land and generally transfers automatically when dominant estate is transferred.
Easement in gross however neither assignable or inheritable. But commerical easements can be freely transferable to 3rd party. Divisible but must be exclusive (original owner no longer uses it and exclusive to easement holder). All holders of easement must agree to divide.
9
Q
Appurtenant easement
A
Appurtenant easement allows property owners to access land that is only accesible through neighbor’s land
10
Q
Easement in gross
A
Benefits individual or legal entity rather than dominant estate. Easement can be for personal use (use boat ramp) or commercial use (railroad co build rail line across property).
Traditionally can’t be transferred but most courts now allow transfer if easement is used for commercial purposes or if parties intended it to be transferable.
11
Q
How to create an easement
A
- Express grant: recorded and signed by grantor and must comply with formalities of deed
- Implication: operation of law not written doc.
1. Intended easement base don use that existed when dominant and servient estates severed
2. Easement implied from recorded subdivision plan
3. easement by necessity - prescription: adverse possession
12
Q
Class Gifts (When member of class dies before grantor when property is willed)
A
If members of the group die before gift is distributed then their portion is distributed equally among surviving members and the deceased member’s relatives do not inherit.
But class gifts to “issue” “descendents” “heirs of the body” “next of kins” “family” “relatives” etcs will include descendents of pre-deceased members of the class.
13
Q
Equitable Servitude to Run with Land
A
Express or implied covenants regarding land that are enforceable by injunction against promising parties and successors in interest.
3 Elements
1. Intent for it to run with the land
2. actual, inquiry, or record notice and
3. covenant touches and concerns the land.
14
Q
Joint tenancy w. right of survivorship
A
A joint tenancy is a type of concurrent estate in which two or more persons own an undivided and equal interest in property with the right of survivorship. The right of survivorship means that a joint tenant’s interest disappears upon death and the remaining joint tenants’ interests automatically expand proportionally to absorb it. As a result, a joint tenant cannot devise his/her interest at death.
15
Q
Termination of right of survivorship
A
- Destroyed by law (divorce/one joint tenant kills another to get larger interest)
- Partition
- Severance
If one joint tenant makes inter vivos conveyance of their interest, severance occurs and joint tenancy is destroyed. BUT joint tenanct’s interest can’t be devised by will.
16
Q
Lateral Support Rights
A
Landowners have right to have their land supported in its natural state by adjoining land. Means they have a right to have their land undisturbed by withdrawal of support. If adjacent landowner’s excavation causes subsidence, without the original landower’s building contributing, strictly liable for damages to building and land caused by excavation if it is shown the land would have collapsed in its natural state.
If original landowner’s building contributed to subsidence, then excavating landowner is liable for loss/damage to land if he excavated negligently.
17
Q
Assigning Option to Purchase During Lease
A
Courts are split on whether an option to purchase during a lease period can be assigned separately from tenant’s interest in leasehold itself.
18
Q
Life Tenant’s Duties
A
- Pay all current charges due during life tenancy (property taxes, mortgage interest) up to financial benefit received from property (when life tenant occupies land, financial benefit measured by its fair rental value) (so if the fair rental value of the land is substantial, even if no one actually rents, the life tenant has to pay taxes/other expenses)
- Prevent affirmative, permissive, and ameliorative waste
- Make reasonable repairs to preserve property
19
Q
What happens when 1 person in joint tenancy w/ right of survivorship dies?
A
Joint tenacy is concurrrent esetaet in which cotenants hold undivided and equal interest in property w/ right of survivorship. Joint tenant can sevre joint tenancy by conveying interest during life to create tenancy in common.
Joint tenant can’t devise property interest and won’t pass by intestacy b/c at death, joint tenant’s interest ceases to exist and is absorbed into surviving joint tenants’ interests.
20
Q
Restraints on Alienation of Real Property
A
Provision that restricts transferability of real property. Unreasonable restraint disfavored b/c public policy favors free transfer of prorperty so direct (absolute) restraints void. Partial restrains - one limited in time and for reasonable purpose is generally valid.
- Disabling Restraint: prohibition on transfer of property interest by its owner (always void)
- Forfeiture Restraint: owner forfeits property interest if owner attempts to transfer it (restrain on future interest/life estate can be valid)
- Promissory restraint: promise by property interset holder not to transfer property interset (can be valid)
21
Q
Right of First Refusal
A
Partial Promissory restraint on alienation that gives holder preemptive right to acquire property prior to its transfer to another party. Right is generally reasonable if holder of right can purchase the property under the same terms offered to another.
Such provision is valid if it complies with SOF and its terms are reasonableness. Reasonableness determined by balancing utility to the purpose served by the restrain against the likely harm that would result from enforcing it.
Enforceable by injunction.
Subject to RAP except when (1) granted in a lease to current leasehold tenant or (2) created in commercial transaction.
22
Q
Assignment
A
Assignment is complete transfer of tenant’s interest to 3rd party for remainder of lease term. Original tenant retains privity of contract (shared interest in lease agreement) and is liable for rent AND assignee gains privity of estate (right to possess property) and is also liable for rent
23
Q
Adverse Possession
A
Ownership of land can be acquired by adverse possession if a person’s physical possession of another’s land meets the following elements
- Exclusive - physical presence on land not shared with owner
- Hostile- possession is w/o owner’s consent and is adverse to owner
- Continuous - presence is continuous and uninterrupted for statutory period
- Open, notorious and actual - possession is apparent or visible to reasonable owner to give notice
24
Q
Estoppel by Deed
A
Grantor who conveys interest in land by warranty deed b/f actually owning it is estopped from later denying the effectiveness of that deed. When grantor acquires ownership of the land, after acquired title is transferred automatically to prior grantee.
25
Equitable Servitude
Promise to do or not do something on land that is enforceable at equity by injunction. An express equitable servitude is enforceable if it:
1. Writing - servitude is in writing that satisfies SOF
2. Intent to Run- promising parties intended for servitude to bind successors in interest
3. Touch and concern - servitude relates to use, enjoyment, or occupation of dominant and servient estates
4. Notice - person to be bound had actual, record or inquiry notice of servitude.
26
Easement by Necessity
Requires
1. Necessity - dominant estate is virtually useless w/o easement across servient estaet
2. Common Ownership - dominant and servient estates under common ownership in past
3. Severance - necessity arose when land was servered.
27
Licenses
revocable privilege to enter and use another's land for specific purpose
Can be created verbally, in writing, or conduct.
Terminates upon revocation or automatically upon death of licensor/licensee or conveyance of licensed property.
Can't revoke if licensee detrimentally relied on license (pay money to use/maintain license) or if license was coupled with an interest in property (remainderman's license to enter and inspect property).
28
Legal Theory for Suit Arising Before and After CLosing
Implied covenant of marketable title is part of land sale contract regardless of deed type. Seller promises to deliver title reasonably free from doubt and under no threat of litigation such that reasonable person would accept and pay for it.
Under merger doctrine, obligations under land sale contract merge into the deed and are extinguished at closing. So these obligations are enforceable only if contained in deed.
29
Equitable Conversion under Land Sale Contract
Majority rule applies this rule when land sale contract is silent as to risk of loss
Risk of loss is on party w/ equitable title at time property was destroyed unless other party was at fault for loss. Seller only has legal title but buyer has equitable title once contract is formed.
30
Equitable Right of Redemption
When debtor defaults on mortgage, foreclosure can occur but debtor can avoid foreclosure and regain title by excercising equitable right of redemption. Allows debtors to retain property by paying amount currently owed on loan plus interest b/f foreclosure sale.
31
Deed in Lieu of Foreclosure
Debtor can avoid disclosure by deeding/conveying all itnerest in mortgaged property to lender. BUt lender takes property along with junior interests attached to the property. If lender accepts deed without reserving the right to foreclosure, then its original mortgage extinguished.
32
Common interest communities (Condos, co-ops)
Governed by an association made up of unit owners. Association imposed rules contained in deeds/declarations.
Rules subsequently adopted by association are subject to reasonableness standard. Balance utility of restraint against harm that is likely to flow from its enforcements. Usually deemed reasonable if their purpose is to protect common property.
33
How is a season ticket treated in property law?
Tickets are a mere license to enter property rather than property interest. Gives ticket holder contractual right to use some portion of the issuer's property for a fixed period of time but does not afford that ticket holder any interest in the property.
License may be revoked, but issuer will be liable for damages if it does so wrongfully. B/c ticket is contractual right, ticket holder's remedy for wrongful revocation will be in contract rather than property law.
34
Death Escrow
Grantor may give a deed to an escrow agent to deliver to grantee once grantor dies. A death escrow is effective as long as (1) only condition is the grantor's death and (2) the grantor doesn't retain the legal right to take the deed back out of escrow.
Usually are gifts that take place of wills
No written or oral contract is required because most death escrows are gratuitious.
35
Merger of Dominant/Servient Estates Effect on Easement
An easement is terminated if the owner of the dominant or servient estate acquires fee title to the other estate. The easement merges into the title and is terminated.
36
Easement by Implication
If the owner of two parcels of land previously used on parcel to benefit the other, then the court may find that upon transfer of one parcel, the parties intended the use to continue if that use was continuous, apparent or known, and reasonably necessary to the dominant estate's use and enjoyment.
37
Private Nuisance
Liability for private nuisance arises when def's interference with plaintiff's use and enjoyment of his property is (1) substantial (offensive, annoying, or intolerable to a normal/average person in the community and (2) unreasonable (severity of plaintiff's harm outweighs utility of def's conduct.
38
Public Nuisance
Liability for public nuisance arises when def' interference with public right, such as health, safety, peace is unreasonable (significantly affected public health, safety, or peace or violation of law) and causes special harm (harm different from that of public at large).
39
Real Covenant
A covenant is a promise between parties to do or not do something on land that is enforceable by an action for money damages (real covenants)
- For burden to run
1. writing
2. intent to run
3. touch & concern
4. Horizontal and vertical privity
5. Notice
- For benefit to run
1. writing
2. intent to run
3. touch & concern
4. Limited vertical privity
5. No notice
Successors in interest are bound only if the covenant runs with the land.
40
Right to Subjacent Support
Right to support from beneath the surface of land. Arises when owner conveys to third party the right to access their land to remove minerals. Owner of the rights is strictly liable (no need for fault) for any failure to supor the land and buildings that existed on the land when the mining rights were conveyed provided that that the damage would have occured in the land's natural state.
41
Lapse
Causes devise to fail if beneficiary predeceases testator (unless their is an anti-lapse statute)
42
Ademption
Extinction: specifically devised property not owned by testator at death will cause devise to fail.
Exception: satisfaction - beneficiary received devised proprty during testator's life
43
Exoneration of Liens Doctrine
Common law doctrine that allows beneficiary of specifically devised real property to use estate's remaining assets to pay off encumbrances on that property.
Most states have abolished this doctrine and payment of an encumbrance on devised real property is required only if will specifies.
44
Abatement
Reduces devises that cannot be satisfied by assets remaining after testator's debts are paid. Residuary devises abated first followed by general and then specific devises.
45
Ownership of Emblements
Wild uncultivated crops are considered part of the real property on which they grow, so they automatically pass with the land.
Crops that are purposely planted and cultivated are considered the landowner's personal property and are conveyed with land. However, prior owner has right to reenter to remove these crops if they were
1. harvested and therefore severed from the land
2. Ripe and therefore deemed constructively severed from the land (in some courts) OR
3. Planted by tenant with lease of uncertain duration or an adverse possessor under a claim of right.
46
Termination of Covenant
1. Abandonment - occurs when an affirmative act - something more than neglect or nonuse - shows a clear intent to relinquish the covenant.
47
Priority if purchase money mortgages v. Liens
1. Purchase money mortgages (highest priority) (regardless of if it was recorded or not)
2. Senior Recorded Liens
3. All other recorded liens
4. Unrecorded lens (lowest priorirty)
48
Installment Land Contract
Contract under which seller retains title to property until buyer makes final payment under an installment plan.
Traditional Rule: Buyer who msies single payment defaults and seller could keep prior installment payments and take back property
Modern Rule: Buyer's failure to pay may:
1. allow seller to retain owernship of property but require some form of restitution to buyer
2. offer the buyer and equitable right of redemption - buyer can keep property by paying full balance on installment contract at any point in time prior to foreclosure sale OR
3. treat installment land contract as mortgage so seller must foreclose to gain title to property and buyer has equitable right of redemption
49
Weird Rule to Assumption of Mortgage
A buyer who assumed a mortgage as part of the purchase price may not raise defenses—e.g., duress, statute of limitations, lack of legal capacity—that the debtor could have raised to avoid the mortgage obligation. Otherwise, the buyer would be unjustly enriched.
50
Rule Against Perpetuities
RAP invalidates any interest in property if there is any chance that the interest may vest more than 21 years after some life in being at the creation of the interest. RAP applies to:
- Contingent remainders (A to life then to the heirs of B)
- Executory interests (To A but if A marries, to B; To A for life then to B if B delivers a eulogy at A's funeral)
- Class gifts (even if vested remainders (A for life, then to A's children)
- Options and rights of first refusal (A for life then B has right to purchase)
- Powers of appointment (To A to be distributed as he sees fit)
Generally vested interests are not subject to RAP. Interests are vested if there is no condition attached which must be satisfies (occurs when holder of interest has present or certain right to take immediate possession when prior estate terminates)
51
When is Notice of Judicially Supervised Foreclosure Sale Required
Foreclosing mortgagee must give notice to any junior interest or else their interest will remain after the foreclosure sale.
May but not required to give notice to senior interests
52
Exceptions to Due-On-Sale Clauses
Certain transfers of residential real property are not subject to a due-on-sale clause
-Devise, descent, or transfer to joint tenant upon death
-Transfer to spouse or child
-Transfer to ex-spouse in divorce
-Transfer to borrower's living trust
-Creation of subordinate lien without occupancy rights
-Granting leasehold interest of less than 3 years without option to purchase
53
Permissible Use of Easement (Scope)
Express Easements
- Uses intended by parties OR reasonably necessary to use/enjoy easement if intent is unknown
- Expansion of use permitted
Easement by Prior Use
- Limited to scope of prior use
- No expansion of use
Easement by Necessity
- Normal uses needed for dominant estate (eg, ingress/egress, utility lines)
-Expansion of use permitted
Prescriptive Easements
- Limited to scope of adverse use during statutory period
- No expansion of use
54
Seller's Duty to Disclose
Majority Rule:
For residential property; must disclose KNOWN material defects that buyer could not reasonably discover
55
Doctrine of Subrogation
Third party who pays another's mortgage loan in full becomes owner of the loan and mortgae securing that loan to the extent necessary to prevent unjust enrichment. Subrogee may seek reimbursement from debtor or enforce mortgae.
56
What happens when a deed names a nonexistent grantee
The deed is void as to that non-existent grantee but if there is another grantee, they retain their portion of the interest and the other portion goes back to the original owner.
57
What happens to a lease in a joint tenancy w/ rights of survivorship when 1 joint tenant dies?
Lease would terminate and remaining property would pass automatically to surviving joint tenant
58
What happens to a lease in a tenancy in common when 1 tenant in common dies
Lease remains valid. If tenant in common leases his interest to a tenant, the tenant has the same rights with respect to the property as the tenant in common has.
59
What remedies does a landlord have if tenants use leased property for illegal activity?
If tenant's illegal use of a property is continuous, landlord may
1. terminate the lease
2. recover damages AND/OR
3. pursue injunctive or monetary relief
60
When can landlord keep security deposit
1. Failure to pay rent
2. Damage to premises beyond normal wear and tear
Can't keep just b/c tenants do illegal stuff on the premises.
61
Revoking subcontractor Bid
Generally, can revoke a subcontractor bid any time before acceptance (genearl contracting bid accepted)
But can't revoke if general contractor had to pay bid bond when submitting offer.
62
What can association do to ensure compliance with rules?
1. Impose fines, penalties, and late fees
2. withdraw privileges to use common recreational/social facilities
3. require prior submission of plans for projects to ensure compliance
4. conduct reasonable inspections of property for violations and with a reasonable belief that such violation exists AND/OR
5. deny voting privileges or board positions
63
Defenses to enforcement of Mortgage
Mortgage is subject to same defenses (mistake, duress, fraud) as underlying obligation secured by mortgage. So when mortgaged property is transferred, even to donee, transferee is able to assert the donor-mortgaor's defenses against lender. However, a purchaser who assumes an existing mortgage as part of the purchase price may NOT assert the mortgagor's defenses.
64
Risk of Loss Under Real Estate Contract
Majority Rule:
Equitable Conversion places risk of loss on buyer during executory period (period b/w execution of real estate contract and closing)
Minority Rule:
Uniform Vendor and Purchaser Risk Act
Risk of loss remains with seller until buyer takes possession of or receives legal title to property.
65
Mortgage Alternatives
1. Absolute deed: Debtor gives deed to creditor with intent to secure loan (ie, equitable mortgage)
2. Deed of trust: Debtor gives deed of trust to third-party trustee as collateral for debt, & creditor can instruct trustee to foreclose upon default
3. Installment land contract: Debtor agrees to buy land through installment payments & gets immediate possession, but seller keeps legal title until paid in full
4. Sale-leaseback: Seller leases property from buyer immediately after sale, & seller's rental payments function as repayments on loan
5. Equitable vendor's lien: Seller finances buyer's purchase with equitable vendor's lien when seller transfers title to buyer but purchase price not fully paid
66
Equitable Mortgage
Established when a debtor gives an absolute deed—i.e., a deed that is free of encumbrances and transfers unrestricted title to property—to a lender with the intent to secure a loan. The debtor-grantor must prove by clear and convincing evidence that the deed was intended as security for a loan—not as an outright transfer. The deed recipient, like any other lender, may then bring a foreclosure action if the debtor defaults.
67
When is a deed void?
1. Grantor's signature void
2. Deed is forged (falsely made or materially altered with intent to defraud)
3. Grantor is deceived about nature of executed doc
Void deed is unenforceable even if relied upon by BFP
68
Future-Advances Mortgage
Mortgage given in exchange for right to receive money in the future. Priority de
69
Fair Housing Act
Prohibits discriminatory actions in sale/renting of dwelling based on race, color, religion, sex, handicap, national origin, or familial status
Applies to:
-refusing bona fide offer
-discriminating in terms, conditions, privileges, or services of purchase/rental
-advertising preference for or discrimination against buyer/renter
-falsely representing dwelling's availability for inspection, sale, or rental
-inducing sale/renting with discriminatory representations about neighborhood
-denying reasonable modifications to accommodate handicap at occupant's expense
Exceptions
- religious organizations
-pivate clubs that incidentally provide lodging to members
-familial status for senior housing
-owner of ≤ 3 single-family dwellings*
-owner-occupied dwellings with ≤ 4 units*
-sale/rental of single-family home by private owner
These exceptions do not apply to discriminatory advertisements or when owner is assisted by a real estate agent, broker, or salesman.These exceptions do not apply to discriminatory advertisements or when owner is assisted by a real estate agent, broker, or salesman.
70
Condemnation (Eminent domain)
Government takes entire property for public use.
Partial Condemnation - where only a portion of leased property is taken. Tenant must continue to pay rent but is entitled to compensation for the portion taken
Complete Condemnation - where entire leased property is taken. Tenant discharged from rent obligation and entitled to compensation for taking
71
Variance
Permits a waiver from a zoning requirement. Will be granted when an owner convinces a zoning appeals board that w/o the variance the owner would suffer hardship re the use of the land.
72
Effectiveness of Title Insurance
After loan fully repaid, lender's policy of title insurance ends. After loan fully repapid, buyer's policy of title insurance continues to protect the owner if the owner is ever successfully sued on a title covenant in a future conveyance.
73
Mortgagee in POssession
Situations where mortgagee is entitled to take possession of property b/f the mortgage is paid off or foreclosed on.
When mortgagor abandons premises and stops paying their mortgage, mortgagee entitled to take possession and administered property to maintain value of his security interest.
Once mortgagee takes possession, he has duties roughly parallel to those of the actual owner. Must maintain property in reasonable condition and credit any rents against mortgage debt.
74
Equitable Mortgage
A landowner needing to raise money may "sell" land to a person who will pay cash and may give the "buyer" an absolute deed rather than a mortgage. However if court deemds by clear and convicing evidence that the deed was given for security purposes they will treat it as a equitable mortgage and require the creditor foreclose it by judicial action like any other mortgage.
Factors:
1. Existence of a debt/promise of payment by deed's grantor
2. grantee's promise to return the land if debt is paid
3. fact that the amount advanced to grantor/debtor was much lower than value of property
4. degree of grantor's financial distress.
5. Parties' prior negotiations
75
General POwer of Testamentary Appointment
Creates specific power to appoint in one's will. Most jurisdictions require language of will to specifically refer to the exercise of the power
76
Duties of Co-tenants
Co-tenants have a right to contribution from each other for certain expenses such as taxes, mortgage payments, and necessary repairs. An accounting is the method used to determine each co-tenant's respective contribution rights.
77
Duties of Adjoining Landowners
Landowners are expected to use their property reasonably w/o injuring rights of adjoining landowners.
78
Equitable Vendor's Lien
When Seller transfers title to a buyer and any portion of the purchase price remains unpaid - the seller has an equitable vendor's lien (implied by law - no judicial process needed)
79
A landlord can transfer property interest to 3rd party (assingee-landlord) w/o tenant's consent. Assignee landlord only has the right to enforce a covenant/promise in the lease if it runs with the land. Otherwise, original landlord retains right to enforce it.
Covenant runs with the land when:
1. Original parties intended to bind successors in interest (eg, assignee-landlord)
2. covenant touches and concerns the land (affects value of or use of)
3. transfer brings the assignee- landlord into privity of estate (mutual or successive relationship in the same property interest) with the tenant.
80
Caveat Emptor
Common law rule - seller has no duty to disclose property defects to buyer. Still applies to commercial sells but minority rule for residential sales.
81
Disclaimer of Duty to Disclose
Seller of property can disclaim duty to disclose material defects if (1) disclaimer is clearly and specifically stated in sales contract AND (2) seller has not fraudulently misrepresented or concealed the condition of the property.
82
Effect of Modifying Senior Mortgage
When a senior mortgage is modified by the parties, it will retain priority against junior interests so long as the modification does not materially prejudice the holders of the junior interest.
Strong presumption that time extension on repayment isn't materially prejudicial b/c debtor is less likely to default on senior mortgage and force a foreclosure.
82
Doctrine of Changed Conditions
Allows court to modify/terminate servitude if surrounding area or circumstances have changed so much that the servitude can no longer fulfill its purpose and it would be unfair to continue to enforce it (Ex; servitude requires residential use in an area that has become commercial.
83
Apportioning (Dividing) Easement in Gross
Depends on if easement is exclusive or non exclusive
Exclusive to transferor (held by 1 person)- easement generally can be divided among multiple transferees
- subject to One Stock Rule
- Collective use that the transferees can make of the easement is limited to use that the transferor made of the easement.
Non Exclusive to transferor (held by multiple ppl)- easement can't be divided among multiple transferees.
84
Anti-Lapse Statute
If donee dies b/f testator, gift will lapse and be invalid unless will or anti-lapse statute says otherwise.
When there is an anti-lapse statute, this will save gift from lapsing if the donee has a specified family relation to the testator AND donee is survived by his/her own children or other LINEAL descendants (issue). Then surviving issue will take place of donee.
85
Ways to Terminate Easements
Destruction - servient estate condemned or destroyed by natural forces
Abandonment - dominant estate abandons easement
Merger - dominant and servient estates unite in common ownership
Prescription - servient owner prevents use for prescriptive period
Estoppel - dominant owner estopped from asserting easement
Release - express release in writing satisfying SOF
86
Common Interest Community
Real estate development in which individually owned lots are burdened by a covenant that imposes an obligation to pay dues to an association. The association is governed by a board which excercises the association's power to manage common property, administer covenants, etc. Board must act REASONABLY when exercising its discretionary powers.
87
When do co-tenants in common need consent from other co-tenants to do something
Consent Required:
- Conveyed entire co-owned property
- Obtain exclusive possession over part of property
- Bind other cotenants' interests in contracts with third party
Consent Not Required
- Sell, lease, devise personal ownership interest
- Possess entire co-owned property
- Extract minerals from co-owned property unless committing waste
88
Attornment
Occurs when tenant accepts a new landlord in place of old one. But new landlord does not become liable for dangerous latent defects unless he/she has had reasonable opportunity to discover and take precautions against them.
89
Conflict of Law Rules for Real Property Issues
If the conflict involves real property, then the general rule is that the law applied by the forum court should be determined by the conflict-of-laws rule that would be applied by the courts of the situs state (i.e., the state where the property is located)
90
Landowner Duty of Care Under Modern Approach
Land possessors owe a duty of reasonable care to all land entrants ecept flagrant trespassers.
91
Liquidated Damages in Land Sale Contracts
Liquidated damages are recoverable so long as the liquidated amount bears a reasonable relation to anticipated damages. Many courts have held that a deposit of no more than 10% of the purchase price is reasonable.
92
Requirements for a Valid Deed
A valid deed must be in writing and contain the following elements: (1) the identity of the grantor and the grantee, (2) words of transfer, (3) a description of the property interest being transferred, and (4) the grantor's signature.
93
Practice of law in preparing deeds & closing documents
Giving legal advice and counsel to others, as well as preparing and approving legal instruments such as deeds and mortgages for someone else, generally constitutes the practice of law. However, the completion of standard mortgage-loan documents by nonattorney employees of a mortgage lender is not the practice of law so long as the employees are not exercising legal discretion in completing the documents. This is true even if the lender charges the borrower a reasonable fee for preparation of such documents.
94
Fixture v. Chattel
A fixture is tangible personal property attached to real property in such a manner that it is treated as part of the property when determining ownership.
Chattel is personal property that
95
When can tenant remove fixture?
Absent an agreement to the contrary, a fixture that the tenant has attached to the leased property may be removed if:
1. the leased property can be and is restored to its former condition and
2. the removal and the restoration are made within a reasonable time.
A reasonable time for removal generally does not extend beyond the termination of the lease. However, it does so when (1) the termination was not due to a breach by the tenant and (2) the date of termination was not foreseeable by the tenant sufficiently far enough in advance to permit removal before the lease terminates
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Fiduciary Duties Owed By Cotenants
cotenants owe a duty of fair dealing BUT NOT fiduciary duty to each other. However, fiduciary duty may be imposed on cotenants who
1. jointly purchase property in reliance on each other or
2. acquire their interests at the same time from a common source (e.g., by gift, will, or inheritance).
This duty primarily arises when the co-owned property is sold at a tax or mortgage foreclosure sale and purchased by a cotenant. The other cotenants then have the right to reacquire their original interests by paying their share of the cost paid to acquire the property (based on the cotenant's ownership interest) within a reasonable time.
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Implied Warranty of Fitness or Suitability
Implied in almost all jurisdictions in a contract for the sale of a newly constructed residence. Under this warranty, the seller asserts that he used adequate materials and workmanship for the residence. The implied warranty generally covers latent construction defects or problems that do not manifest themselves until after the sale.
The buyer has a duty to reasonably inspect the residence for patent defects but is not required to employ an expert home inspector. Generally, a suit for breach of the implied warranty may be brought against builders, developers, and contractors within a reasonable time after discovery of the defect. A majority of jurisdictions permit both the initial homeowner-purchaser and subsequent purchasers who do not contract directly with the commercial developer to recover damages.
