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Flashcards in Real Property Deck (139):
1

The future interest following a life estate or term of years is a ___________ if held by the grantor.

Reversion

2

A fee simple determinable ("fee on limitation" in New York) is followed by a ________________.

Possibility of reverter ("right of reverter" in New York).

3

A fee simple subject to condition subsequent ("fee on condition" in New York) is followed by a ________________in the grantor

Right of entry

4

For a fee simple subject to an executory limitation, the third party's interest is called an __________.

Executory interest ("remainder subject to a condition precedent" in New York).

5

A remainder is contingent if...

(1) It is left to an unascertained person. OR
(2) It is contingent on some event occurring, other than the natural termination of the prior estate.

6

Three types of vested remainder

(1) Indefeasibly vested
(2) Vested subject to compete divestment
(3) Vested subject to open

7

What are the requirements for a covenant?

(1) in writing
(2) intent that the duties run with the land
(3) touch and concern the land

If subsequent purchasers, need:
(4) Notice of the covenant (actual, constructive, or inquiry)
(5) horizontal privity (estate and the covenant are contained in the same instrument)
(6) vertical privity (unbroken chain of ownership from the original parties).

8

How do you terminate a covenant?

Same ways as an easement

abandonment: affirmative action that shows clear intent to relinquish covenant.

9

What are the requirements for a valid land sale contract?

(1) in writing
(2) signed by the party to be charged
(3) contains all the essential terms

Exception for equitable estoppel if one party detrimentally relies.

10

What is the "implied covenant of marketable title"?

Promises title free from unreasonable risk of litigation. Implied in In every contract for sale of real property.

A breach of the covenant gives the buyer the right to terminate the contract. But if the defect is not the fault of the seller, damages are limited to recovering money paid out.

11

How can you oust a co-tenant?

Express ouster: Communicate intention to exclude or deny co-tenant of his rights + 10 year adverse possession

Implied ouster: Can imply ouster if 10 years of exclusive possession by the co-tenant + 10 years of adverse possession. (20 total)

12

What is an "equitable servitude"?

An equitable servitude is a nonpossessory property right created when:
(1) there is an intent that a land use restriction is to be enforceable not only by parties to the agreement but also by their successors-in-interest;
(2) the person against whom the servitude is to be enforced has actual, constructive, or inquiry notice of the servitude; AND
(3) the servitude touches and concerns the land

13

What is the doctrine of exoneration of liens?

Devisee of real property is entitled under the doctrine of exoneration of liens to have any outstanding balance of a mortgage or other encumbrance on the property to be paid from the remaining assets of the testator's estate.

14

What is a "fee simple determinable"? And what language is used to create it?

Fee simple limited by specific durational language. Eg., "so long as," "while," "during," "until."

15

What is a "fee simple subject to condition subsequent"? And what language is used to create it?

Fee simple limited by specific conditional language. E.g., "but if," "provided that," "on the condition that."

16

What are the three types of fees?

(1) fee simple
(2) fee simple determinable
(3) fee simple subject to condition subsequent

17

What are the three types of waste?

(1) affirmative waste = voluntary conduct that decreases value of the land
(2) permissive waste = neglect that causes decrease in value of land
(3) ameliorative waste = tenant changes the use of property and increase the value of property

18

When does the doctrine of waste apply?

Look for simultaneous interests in land + change in value of property. Including:
(1) present estates vs. future estates
(2) landlord vs. tenant
(3) co-tenant out of possession vs. tenant in possession
(4) mortgagee vs. mortgagor

19

What are the three kinds of concurrent estates?

(1) tenancy in common
(2) joint tenancy
(3) tenancy by the entirety

20

What are the requirements for a tenancy in common?

Concurrent owners have separate but undivided interests in the property. (I.e., each has a right to possess the whole.)

21

What are the requirements for a joint tenancy?

Four Unities:
(1) Possession (equal right to possess the whole)
(2) Interest (tenants have equal share of ownership)
(3) Time (tenants received interest at the same time)
(4) Title (tenants received ownership from the same instrument)

22

What destroys a joint tenancy?

(1) any inter vivos transfer by one of the tenants
(2) mortgage in a title theory state, but not in a lien theory state
(3) Leasing the property (in some jurisdictions)

23

What are the requirements for a tenancy by the entirety?

Four Unities:
(1) Possession (equal right to possess the whole)
(2) Interest (tenants have equal share of ownership)
(3) Time (tenants received interest at the same time)
(4) Title (tenants received ownership from the same instrument)
PLUS:
(5) tenants are married

24

What is different in a tenancy by the entirety from a joint tenancy?

Tenants cannot alienate or encumber their share without consent of their spouse.

25

What is "ouster" between co-tenants?

A co-tenant denies another co-tenant access to the property. Can be implied or express.

26

Should rents collected from third parties be divided based on the ownership interest of each co-tenant?

Yes. Rent, minus operating expenses, are divided among co-tenants.

27

Are co-tenants responsible for operating expenses of a jointly owned property?

Yes. Includes taxes or mortgage interest payments. Divided based on ownership share.
Co-tenants can sue for contribution from other co-tenants for payments in excess of their share of operating expenses.

28

Are co-tenants jointly responsible for repairs?

No. There is no right to reimbursement from co-tenants for necessary repairs. BUT can get credit in a partition action.

29

Are co-tenants jointly responsible for improvements to jointly held land?

No. No right to reimbursement. But tenant that makes the improvement can get credit in a partition action.

30

What is a "partition" of a concurrent estate?

Equitable remedy that divides property into distinct portions. Unilateral right, UNLESS tenancy by the entirety = consent of all tenants required.
Courts prefer physical division. But will order sale if (1) not practical OR (2) not fair to all parties.

31

What are the two kinds of executory interest?

(1) springing executory interest = divests the grantor
(2) shifting executory interest = divests the prior grantee

32

What is the doctrine of worthier title?

Converts a remainder in the grantor's heirs to a mere reversion in the grantor.

33

What is the rule in shelley's case?

Converts a remainder in the grantee's heirs to a mere fee simple.

34

What interests are subject to RAP?

(1) contingent remainders
(2) executory interests
(3) vested remainders subject to open if remainder not closed by rule of convenience

35

What is a "measuring/validating life" under the RAP?

Person who is...
(1) alive when the interest is created
(2) mentioned or implied by the grant

36

What is the RAP?

The common-law rule prohibiting a grant of an estate unless the interest necessarily vests no later than 21 years after the death of some person alive when the interest was created.

37

In general, how does the RAP apply to class gifts? What are the exceptions?

All-or-nothing rule: If the gift to any member of the class is void under RAP, then the gift is void as to all members of the class. The gift is “bad as to one, bad as to all.”
Exceptions:
(1) transfers of specific dollar amount to each class ember
(2) transfers to a subclass that vests at a specific time (e.g., “to the children of B, and upon the death of each, to that child’s issue”)
(3) rule of convenience

38

What is the "rule of convenience" in RAP?

For purposes of RAP, the class closes as soon as a member of the class is entitled to immediate possession of the estate. This prevents voiding an entire class merely because, e.g., one member will not satisfy RAP.

39

What are the two exceptions to the RAP?

(1) Gifts from one charity to another charity
(2) Options held by a current tenant to purchase a fee interest in the leasehold

40

What is the "wait and see" approach to the RAP?

Some jurisdictions wait and see if an interest subject to RAP vests within the perpetuities period.

41

What are the four types of lease tenancies?

(1) tenancy for years
(2) periodic tenancy
(3) tenancy at-will
(4) tenancy at sufferance

42

What is a tenancy for years?

Measured by a fixed and ascertainable amount of time. If longer than one year, agreement must be in writing re: Statute of Frauds.

43

What is a periodic tenancy?

Estate that is on-going for a set period of time, then renews automatically and the end of each period until one party gives notice of termination. Notice must be given before the start of what will be the last period.

44

What is a tenancy at will?

Tenancy that may be terminated by landlord or tenant at any time, for any reason. No notice required.
If landlord has right to terminate at will, tenant must also get the right. But vice versa is not required.

45

What is a tenancy at sufferance?

Created when a tenant holds over after a lease has ended. Exists until the landlord evicts the tenant or re-rents the property to the tenant.
During tenancy at sufferance, terms of the prior lease control.

46

What are a tenant's two basic duties to the landlord?

(1) pay rent
(2) avoid waste

47

What are the three situations where a tenant's duty to pay rent is suspended?

(1) premises are destroyed AND tenant did not cause the damage
(2) landlord completely or partially evicts the tenant
(3) landlord materially breaches the lease

48

What is "constructive eviction"?

Four elements:
(1) premises were unusable for intended purpose (i.e., breach of covenant of quiet enjoyment)
(2) tenant notifies landlord of the problem
(3) landlord does not correct the problem, AND
(4) tenant vacates premises after reasonable amount of time

49

What is the "implied warranty of habitability" in a leasehold agreement?

Landlord has an obligation to maintain the property such that it is suitable for residential use. Must avoid conditions that threaten tenant's health and safety. Breach of housing codes = breach of covenant.
Tenant CANNOT waive.

50

What are a tenant's three remedies for breach of implied warranty of habitability?

(1) refuse to pay rent (after notification + reasonable time)
(2) remedy defect and offset costs against rent
(3) defend against eviction

51

Who has a duty to repair in a residential lease?

Landlord. Tenant must notify landlord of needed repairs. Landlord is not responsible for repairs caused by tenant's actions.

52

What is the duty to mitigate in a leasehold? (majority and minority rules)

Majority = If tenant abandons the property or is evicted, landlord has an obligation to mitigate damages by using reasonable efforts to re-rent.
minority = landlord has no duty to mitigate damages.

53

What is a landlord's duty to deliver possession? (majority and minority rules)

Majority = landlord must give actual/physical possession.
Minority = only required to give legal possession

54

What must landlord's control in most leases?

(1) common areas
(2) nuisance-like behavior of other tenants

55

After property is leased, how can a landlord be held liable for negligence to third-parties?

(1) any latent or hidden defects of which the tenant is not warned
(2) faulty repairs completed by the landlord negligently
(3) injuries in common areas caused by landlord's negligence

56

What is the difference between "assignment" and "sublease"?

Assignment = complete transfer of the tenant's remaining term. Landlord can collect rent from either tenant or subsequent tenant.

Sublease = transfer of less than tenant's remaining term. Landlord can collect rent only from original tenant.

57

When can a landlord withhold consent to assignment/sublease of a leasehold? (majority and minority rules)

Majority = only for a commercially reasonable reason
Minority = at landlord's total discretion

58

What is the "Fair Housing Act"?

Prohibits discrimination in housing based on race, color, religion, national origin, sex, disability, and family status. (Exemption for senior living for family status.)

59

What are the four elements of adverse possession?

(1) continuous possession for statutory period
(2) Open and notorious
(3) Hostile, AND
(4) Exclusive

60

When can the "continuous possession" prong of adverse possession be fulfilled by tacking time onto a third party's possession?

The current adverse possessor must be in privity with the prior adverse possessor

61

What are disabilities that toll the adverse possession statute of limitations?

(1) insanity
(2) infancy, or
(3) imprisonment

62

What does the "open and notorious" prong of adverse possession require?

Possession is such that it would put a reasonable true owner on notice of the adverse use.

63

What does the "hostile" prong of adverse possession require? (majority and minority rules)

Possession contrary to owner's interest.
Majority = No inquiry into adverse possessor's state of mind
Minority = require adverse possessor to either have (1) good faith based on mistaken believe that possessor owns the property OR (2) bad faith to know that his possession is a trespass.

64

Can two adverse possessors both take title to land?

Yes. They become tenants in common.

65

What is constructive adverse possession?

Adverse possessor enters under color of title from an invalid instrument.

66

What is the doctrine of merger re: contracts and deeds?

Covenants in a contract for sale of real property are merged into the deed and cannot be enforced unless also present in the deed.

67

What are the requirements for fulfilling Statute of Frauds?

(1) in writing
(2) signed by the party to be charged
(3) includes all essential terms (names of parties, description of property, price and payment method)

68

What are the two exceptions to the Statute of Frauds?

(1) part performance (requires TWO of: (1) payment, (2) possession by purchaser, (3) improvements to land)
(2) detrimental reliance

69

What is a seller's duty to disclose defects? Can it be disclaimed?

Must disclose all known, physical, material defects. Cannot disclaim.

70

What is the doctrine of "equitable conversion"? (majority and minority rule)

Majority = follows doctrine: Places the risk of loss during a sale on the buyer (who holds equitable title) between execution of contract and closing.
Minority = places risk on the seller until closing.

71

What are the two components of a mortgage?

(1) note (borrower's promise to repay the loan/debt)
(2) mortgage itself (instrument that secures the note)

72

What is a "lien state"?

Treats a mortgage as a lien that does not destroy a joint tenancy.

73

What is a "title state"?

A mortgage destroys joint tenancy and converts it into a tenancy in common.

74

What are four alternatives to mortgages that are typically treated like mortgages. I.e., "equitable mortgages"

(1) deed of trust (trustee holds title for benefit of lender)
(2) installment land contract
(3) absolute deed (mortgagor transfers deed instead of a security interest)
(4) Conditional sale and repurchase. (borrower sells property to lender who leases property back to owner in exchange for a loan)

75

What must a borrower who uses an absolute deed do to prove to a court that the sale was actually a mortgage?

To prove the sale was actually mortgage, borrower must show clear and convincing evidence. Parol evidence is allowed.

76

What is an "assumption" of a mortgage?

When a transferee assumes the mortgage, the transferee becomes liable for it. BUT the Transferor remains secondarily liable for the mortgage.

77

What is taking "subject to" a mortgage?

Transferee is NOT liable for default of mortgage. But lender may foreclose on property if transferor does not make payments.

78

What is equity of redemption? When can it be used?

Common law right where mortgagor can reclaim title and prevent foreclosure by paying in full. Must exercise the right before the foreclosure sale.

79

What interests in property survive a foreclosure sale? What interests don't?

Senior interests (those acquired before the interest that is being foreclosed) survive. Junior interests (acquired after) are extinguished.

80

What are the 5 exceptions to the extinguishing of junior security interests after a foreclosure?

(1) Purchase-money security agreement has priority over all others.
(2) recording act exception = junior interest may take priority over unrecorded senior interest
(3) subordination between mortgagees = agreement
(4) mortgage modifications = modifications that make the mortgage more burdensome are subordinated. But only as to the modification amount.
(5) future-advances mortgages

81

What is a statutory redemption?

Some states allow the mortgagor to redeem the property even after the foreclosure sale. Statute will enable homeowner to nullify the foreclosure.

82

What is required for a deed to be valid?

(1) delivered
(2) grantor had present intent to transfer property (no future intent)
(3) accepted

83

What is the common law, baseline recording rule?

First in time, first in right. The first grantee to receive a deed wins.

84

What interests in land are governed by a state's recording act statute?

(1) deeds
(2) mortgages
(3) leases
(4) options
(5) judgements affecting title
(6) Any other instrument, e.g., easements, or covenants

85

Who is protected by a recording act statute?

Subsequent purchasers (those who pay value for the land)

86

Who is not protected by a recording act statute?

Anyone who acquires through:
(1) gift
(2) intestacy
(3) devise

87

What are three types of notice?

(1) actual notice
(2) constructive / record notice = prior interest is recorded
(3) inquiry notice = a reasonable investigation would have disclosed prior claims

88

What is a "race statute" recording act?

First to record wins. Look for "first recorded," or "first to record."

89

What is a "notice statute" recording act?

Subsequent purchaser has good title if he/she buys without notice of a prior, unrecorded interest. Look for "in good faith" or "without notice."

90

What is a "race-notice statute" recording act?

Subsequent purchaser has good title if (1) purchases without notice of prior unrecorded interest; AND (2) first to record. Look for "first duly recorded," or "first recorded."

91

What is the "shelter rule" in the context of recording act statutes?

A person who takes from a bona fide purchaser protected by the recording act is also protected.

92

What is "estoppel by deed"?

When a grantor conveys land he does not own, if he subsequently acquires the land, land automatically transfers to the purchaser. The grantor is estopped from trying to repossess.

93

What are the three types of deed?

(1) general warranty deed = protects against all defects
(2) special warranty deed = protects against defects caused by the grantor
(3) quit-claim deed = no warranties/protection

94

What are the six implied covenants of deed? (three present and three future)

Present covenants:
(1) covenant of seisin = deed describes the land in question
(2) covenant of right to convey = grantor has right to convey the property
(3) covenant against encumbrances = there are no undisclosed encumbrances on the property

Future covenants:
(4) covenant of quiet enjoyment = grantor will defend against challenges to grantee's title
(5) covenant of warranty = grantor promises to defend against future assertions of encroachment
(6) covenant of further assurances = grantor promises to fix future title problems

95

What are "fixtures"?

Tangible personal property that is attached to real property and treated like real property.

96

Can a seller remove fixtures?

Seller is entitled to remove chattel.

97

What is the land burdened by an easement called?

Servient estate

98

What is the land benefitted by an easement called?

Dominant estate

99

What are affirmative and negative easements?

Affirmative = gives holder right to do something on someone else's property
Negative = gives holder the right to prevent someone from doing something on his/her land

100

What is an appurtenant easement? What is an easement in gross?

Appurtenant = attached to the land
In gross = benefits the holder personally

101

What are the requirements to create an express easement?

(1) in writing
(2) any negative easement must be express. Cannot be created by implication.

102

What are the four kinds of implied easement?

(1) Easement by necessity
(2) easement by implication / prior use
(3) easement by prescription
(4) easement by estoppel

103

How is an easement by necessity created?

Created when:
(1) property is virtually useless without it
(2) dominant and servient estates were once one
(3) necessity arose when estate was separated

104

When does an easement by necessity end?

When it is no longer necessary.

105

When is an implied easement by implication created?

(1) Past common ownership: large state owned by one owner
(2) Quasi-easement: before division, owner used land as if there was an easement
(3) use was continuous and apparent at time of severance
(4) reasonably necessary to the dominant estate's use and enjoyment

106

When is an implied easement by prescription created?

Adverse possession of the easement:
(1) continuous use for statutory period
(2) open and notorious
(3) hostile
(no exclusivity required)

107

Who has a duty to maintain the property subject to an easement?

The owner of the easement

108

What are the 7 ways to end an easement?

(1) release (in writing)
(2) merger (owner of easement acquires underlying property)
(3) abandonment (non-use + affirmative act showing intent to abandon)
(4) prescription (holder fails to protect against trespassers for statutory period
(5) estoppel (detrimental reliance on abandonment)
(6) end of necessity

109

What is a "profit"?

Right to enter another's land and remove specific natural resources

110

What is a "license"?

A revocable permission to use another's land (e.g., a ticket to a sporting event, the permission you give to a plumber to come into your house.)

111

What is a "real covenant"?

A promise concerning the use of the land that runs to successors to the promise.

112

What are the 5 required element for a real covenant?

(1) writing
(2) intent to run with the land
(3) touch and concern the land
(4) notice (actual or constructive/record)
(5) horizontal privity = estate and covenant are in the same instrument
(6) vertical privity = covenant runs to successors of the original party's interest

113

What are the 4 required elements for an equitable servitude?

(1) in writing
(2) intent to run with the land
(3) touch and concern the land
(4) successor must have notice (actual, record, or inquiry)

114

What is an "implied reciprocal servitude"?

Equitable servitude that is implied and need not be in writing. Created when:
(1) intent that all plots in a subdivision
(2) must be reciprocal
(3) negative (not positive)
(4) successor must be on notice of the restriction (actual, constructive or inquiry)
(5) common plan or scheme

115

What is the changed circumstances doctrine?

Drastic changes make a covenant/equitable servitude no longer make sense.

116

What is the doctrine of riparian rights?

Anyone bordering a waterway has right to "reasonable use" of the water.

117

How are water rights generally appropriated in a "prior appropriation" jurisdiction?

First in time, first in right. First person to use the water has rights. Must show any "productive" use of the water.

118

What liability standard does a neighbor have to lateral support?

If structures didn't contribue = strict liability
If neighbor's structures contributed = Negligence liability

119

What liability standard does a neighbor have to subjacent support?

Strictly liable for failure to support land and any buildings that existed at time rights were created.
Negligence for any buildings built after rights were created.

120

What is a private nuisance? What do the elements mean?

A substantial and unreasonable interference with another individual's use or enjoyment of his property.

Substantial = would be offensive, inconvenient, or annoying to an average person in that community
Unreasonable = injury outweighs the usefulness of the ∆'s actions

121

What is a public nuisance?

Unreasonable interference with the health, safety, or property rights of the community.
Private property can recover if suffered a different kind of harm than the rest of the community.

122

When are real estate brokers generally entitled to a commission?

Generally, entitled when broker has secured a "ready, willing, and able" buyer. I.e., buyer will purchase according to seller's terms.

Timing = when contract is executed OR if conditions precedent are set, when conditions are satisfied.

Note: Doesn't matter if the sale ultimately goes though

123

Does an adverse possessor affect the title owed to future interest holders in land?

No. Only the present possessory estate.

124

Are recorded judgment lien holders protected from prior unrecorded interests by a recording statute?

No. Creditors who hold a judgment lien are protected only against claims that arise AFTER the judgment lien is recorded. Any interest that arose before gets priority over the judgment lien.

125

When is a buyer of land entitled to specific performance of a land sale contract?

Only if remedies at law are inadequate.

126

After contracting for sale of land, which party has the burden to get insurance?

The buyer. Buyer holds equitable title.

127

Does the RAP apply to an option or right of first refusal granted to a current leasehold tenant?

No.

128

Are people who purchase property at a judicial sale protected from unrecorded interests in the land acquired before the sale?

Yes. A majority of jurisdictions protect buyers at a judicial sale from prior unrecorded interests.

129

What five scenarios commonly violate the RAP

(1) class transfers + "survival beyond age 21" condition
(2) fertile octogenarian (capable of adding to a class and thus violating RAP)
(3) Unborn spouse (watch for grants to "A's widow" instead of a specific person. That "widow" may be unborn at time of grant)
(4) defeasible fee followed by executory interest (executory interest will violate RAP unless a condition is imposed)
(5) Condition on passage of interest not linked to life in being (e.g., end of a war)

130

What is the standard for determining whether something is a fixture?

Objective, reasonable person standard. (subjective beliefs are irrelevant)

131

When can a leasee remove fixtures he/she has attached to the leased property?

(1) if leased property can be restored to former condition after removal, AND
(2) removal is made in a reasonable time

132

What is the exoneration of liens doctrine?

If a testator makes a specific devise of real property that is subject to an encumbrance, the devisee is entitled to have the encumbrance exonerated by payment from remaining assets in the testator's estate.

133

If a lease prevents assignment or subletting of the lease, can the leasee still assign/sublet it?

Yes. But the landlord is generally entitled to terminate the lease based on breach.

134

What is the rule when a contract for sale of land does not mention whether time is of the essence?

Presumption that time is NOT of the essence. (strict adherence to closing date is not required). Contract must explicitly mention that time is of the essence.

135

What is the implied warranty of fitness or suitability for new homes?

Warrants "quality, workmanlike construction, performance and habitability" in a contract for a newly built home.

136

What is subrogation of a mortgage?

Payment of a mortgage by a person who is not legally obligated but pays to protect his interest. This gives rise to subrogation of the mortgagor’s rights, and the payor can invoke defenses or rights otherwise held by the mortgagor.

137

Is agreement to pay rent at a certain date a material term of a lease?

Yes. Grounds for breach.

138

Between a life-tenant and a remainderman, who has responsibility for pay general property taxes?

The life tenant. Only exception is that the life tenant has no duty to expend more than the income that can be generated from the land.

139

Does a recorded judgment lien against one owner in a joint tenancy sever the joint tenancy?

Not automatically. The recording of a judgment against a joint tenant with right of survivorship allows the judgment creditor to obtain a writ of execution but does not affect a severance of the joint tenancy.