Real Property Flashcards
(169 cards)
1
Q
What are the four different ways property can be transferred (i.e., alienated)?
A
- By Sale
- By Gift
- By Divise (will)
- Gifts in a will are effective when the decedent dies
- Intestate Succession
2
Q
Ownership interests are divided in time between present interests and **future interests. **Someone must be in possession of the property ______________.
A
At all times
3
Q
Fee simple is the _____________ posessory estate, because it is capable of _____________.
A
- Largest
- lasting forever (inheritable)
4
Q
What language creates a fee simple?
A
- “And his/her heirs”
- If ambiguous, a fee simple is created because fee simple is the default estate.
5
Q
A defeasible fee is ownership of potentially infinite duration. But, unlike a fee simple absolute estate, a defeasible fee _____________________.
A
May be terminated by the occurrence of an event
6
Q
What language creates a Fee Simple Determinable? Provide some examples.
A
- Limited by specific **durational **language
- Examples:
- “to A so long as”
- “to A while”
- “to A during”
- “to A until”
7
Q
What language creates a Fee Simple Subject to Condition Subsequent?
A
- Limited by specific **conditional **language
- Examples:
- “To A, but if”
- “To A, provided that”
- “To A, on the condition that”
- Look for language that suggests that the grantor must exercise a right in order to take possession
8
Q
What is the Possibility of Reverter? The interest vests ___________.
A
A future interest held by a grantor following a fee simple determinable.
- Automatically
9
Q
What is the Right of Entry? The interest must be _______________.
A
A future interest held by the grantor following a fee simple subject condition subsequent.
- Reclaimed
10
Q
A fee simple subject to executory interest will __________________________________.
A
end upon the happening of an event and future interest will vest in a third party.
11
Q
What is an executory interest?
A
Future interest that will cut short, or terminate (divest), an earlier interest
12
Q
What is a life estate?
A
A present possessory estate that is limited by a life.
13
Q
Who is the measuring life for a life estate?
A
- Grantee - Life Estate
- Third Party - Life Estate Pur Autre Vie
14
Q
What language creates a Life Estate?
A
- “For life”
- If ambiguous, look for the grantor’s intent to create an estate that will end upon the death of the measuring life.
15
Q
- How does the life estate end?
- Can a life tenant, who is the measuring life, pass the property by will?
- Can a life tenant, who is the measuring life, pass the property by intestate succession?
A
- Death
- No
- No
16
Q
What is a reversion?
A
When possession of the land goes back to the grantor after the life estate ends.
17
Q
What is a remainder?
A
When possession of the land goes to a third party after the life estate ends.
18
Q
What are the three types of waste?
A
- Affirmative Waste - waste caused by voluntary conduct, which causes a decrease in value
- Permissive Waste - waste caused by neglect toward the property, which causes a decrease in value
- Ameliorative Waste - Where the life tenant or other person in possession changes the use of the property and actually increases the value of the property.
19
Q
In what situations does waste apply?
A
Where multiple parties have simultaneous interests.
Examples:
- Estates
- Future Interests
- Landlord-Tenants
- Concurrent Estates
- Mortgage
20
Q
What is a concurrent interest?
A
Ownership or possession of real property by 2 or more persons simultaenously
21
Q
Concurrent owners each have right to use/possess the _______________. Except the _____________.
A
- whole of the property
- concurrent owners can contract out of the basic rule
22
Q
In a Tenancy in Common, concurrent owners have _____________________ interests in the property, but no _________________.
A
- seperate, but undivided
- right of survivorship
23
Q
A joint tenancy differs from a tenancy in common because it has ___________________.
A
A right to survivorship (the suriving joint tenant automatically takes the deceased tenant’s interst).
24
Q
To create a joint tenancy, four unities must be in place:
A
- P - possession (requires every joint tenant to have an equal right to possess the whole of the property)
- I - interest (joint tenants must have an equal share of the same type of interest)
- T - time (joint tenants must receive their interests at the same time)
- T - title (joint tenants must receive their interests in the same instrument of title
25
What happens if any of the unities are severed (i.e., destroyed)?
The joint tenancy is terminated and turns into a tenancy in common.
26
Conveyance of an interest in joint tenancy during the life will \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. Conveyance by only one or more than two joint tenants does not destroy the joint tenancy of the remaining joint tenants.
Will destroy the right of survivorship and convert the estate into a tenancy in common.
27
Any lien against a joint tenant's interest ____________ upon that tenant's death, so the surviving tenant's interests are not \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Terminates
* Encumbered
28
A joint tenant grants a mortgage interest in the joint tenancy to a creditor, does the mortgage sever the joint tenancy?
* Majority - **Lien Theory**, mortgage is treated as a lien and **does not** destroy joint tenancy
* Minority - **Title Theory**, mortgage **severs** titles and the joint tenancy is severed **and converted** into a tenancy in common
29
A joint tenant leases her share in the property to a tenant. Does the lease sever the joint tenancy?
* Some jurisdictions hold the lease _severs_ the joint tenancy.
* Other jurisdictions treat the lease as a _temporary suspension_ of the joint tenancy.
30
A Tenancy by the Entirety is
* Joint tenancy between \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Has right of \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Tenants by the entirety ______________ or encumber their shares wihtout the consent of their spouse.
* Married persons
* survivorship
* cannot alienate
31
Does one co-tenant in possession owe the other a duty to pay rent?
No, co-tenant in possesion is not required to pay rent to co-tenants out of poessision.
32
What is the ouster of a co-tenant in the concurrent owner context? How can the ousted tenant get relief?
Co-tenant in possession denies another co-tenant access to the property.
The ousted co-tenant can get an _injunction_ and/or _damages_.
33
Rent received from a third party's possession of the property, minus operating expenses, are divided based on ________________________ of each co-tenant.
Ownership interests
34
What are operating expenses?
Divided based on _______________ of each co-tenant and a co-tenant can collect _____________ from the other co-tenants for payments in excess of her share of the operating expenses.
* Taxes, mortgage interest payments
* ownership interest
* contribution
35
Is there a right to reimbursement for repairs or improvements to the property from the co-tenant?
No, however the co-tenant who makes the repairs or improvements can get credit in a partition action.
36
Who has standing to bring a partition action?
It is a _______________ right and _______________ do not have the unilateral right to partition.
* Holders of _tenancy in common_ or _joint tenancy_
* Unilateral
* Tenancy by the entirety
37
What is a partition in kind?
A physical division of the property
38
Court will order a partition by sale if hte physical partition is: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
How are proceeds divided?
* Not practical; or
* Not fair to all parties
Proceeds are divdied based on their ownership interests
39
Co-tenants can agree not to partition, provided:
* agreement is \_\_\_\_\_\_\_\_\_\_\_\_, and
* time limitation is \_\_\_\_\_\_\_\_\_\_\_\_\_.
* clear
* reasonable
40
An Executory Interest is a future interest in a ___________ that ____________ a prior ____________ interest.
* third-party
* divests
* vested
41
What are the two types of executory interests and who do they divest?
* Springing Executory Interest - grantor
* Shifting Executory Interest - grantee
42
What are the two types of the remainders?
* Vested
* Contingent
43
What is vested remainder?
* Given to an _ascertained_ grantee; and
* Not subject to a _condition precedent_
If these aren't satified, then the remainder is contingent and subject to RAP
44
What is a "vested subject to open" remainder?
* Vested remainder in a class gift; and
* Full class membership is unknown
* Note: *At least one person in the class must be vested for it be vested subject to open, otherwise it is a contingent remainder. The class is closed once all members are identified.
* Note*: subject to RAP
45
The doctrine of worthier title prevents against remainders in _______________ heirs and creates presumption in a reversion to the \_\_\_\_\_\_\_\_\_\_\_\_.
* Grantor's
* Grantor
46
The Rule in Shelley's Case prevents against remainders in _____________ heirs, it uses the doctrine of merger to create a \_\_\_\_\_\_\_\_\_\_.
* grantee's
* fee simple
47
What is the RAP?
Under the Rule Against Perpetuities (“Rule”), specific future interests are valid only if they **must vest or fail by the end of a life in being, plus 21 years**.
48
Who are the Relevant/Validating Lives?
* Relevant life: person who affects vesting, usually mentioned or implied by the grant
* Validating life: person who tells us whether or not the interest vests within the perpetuities period
* Must have been alive when the interests were created
* Can validate own interest
* If no validating life, then interest is no good and we strike it from grant.
49
What is the general rule regarding RAP and Class Gifts?
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.
50
What is the Rule of Convenience?
It saves a class gift from being invalidated under RAP, the class closes as soon as a member of the class is entitled to immediate possession.
51
What are two exceptions tot he class gift rule?
* Transfers of a specific dollar amount to each class member
* Transfers to a sub-class that vests at a specific time
52
When does RAP not apply?
* Charity to charity gifts
* Options held by a current tenant to purchase a fee interest in teh leasehold property
53
Tenancy for Years
* Definition
* Creation
* Termination
* Early Termination
* Definition - measured by a fixed and ascertainable amount of time
* Creation - an agreement by the landlord and the tenant (if the writing is longer than a year is must satisfy S.O.L.)
* Termination -
* At the end of the term
* Automatically upon the expiration of the term
* No notice is required
* Early Termination:
* Tenant surrenders the lease
* Tenant or Landlord commit a material breach
54
Periodic Tenancy
* Definition
* Creation
* Termination
* Definition - Estates that is repetitive and on-going for a set period of time (e.g., month-to-month)
* Renews automatically
* Creation - Parties intend to create
* Express - signed lease
* Implied - payment of rent
* Termination - renews automatically until proper notice is given
* Notice - given before the start of what will be the last term
* Notice effective upon the last day of the period
55
Tenancy at Will
* Definition
* Creation
* Termination
* Definition - May be terminated by either landlord or tenant at any time, for any reason
* Creation - Express or Implied agreement
* Termination - Can be terminated by either party without notice or good cause
* If only landlard has right, then right will also be given to tenant
* If only tenant has right, then right will not also be given to landlord
* If either landlord/tenant dies
56
Tenancy at Sufferance
* Definition
* Creation
* Termination
* Definition - created when a tenant holdsover after the lease has ended. Temporary tenancy exists before the landlord either evicts the tenant or re-rents the property to the tenant. Terms of the prior lease control
* Creation - created by tenants actions (holdover)
* Termination -
* Tenant voluntarily leaves
* Landlord evicts the tenant
* Landlord re-rents to the tenant
57
What are three situations where the duty to pay rent is suspended?
1. Premises are destroyed, so long as tenant did not cause damage
2. Landlord completely or partially evicts tenant
3. Landlord materially breaches the lease
58
Complete Eviction is the removal of the tenant from the \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
the entire property
59
Partial eviction is the removal of the tenant from a \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
Portion of the property
60
Under the implied covenant of quiet enjoyment, the tenant can withhold rent when the _landlord takes action__s_ that make the premises wholly or substantially \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ for their \_\_\_\_\_\_\_\_\_\_\_\_\_\_, and the tenant is \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Unsuitable
* Intended purpose
* constructively evicted
61
What are the four elements of Constructive Eviction?
1. Premises were **unsuable** for their intended purposes
2. The tenant **notifies** landlord of the problem
3. The **landlord does not correct** the problem; and
4. The tenant **vacates** the premises **after a reasonable amount of time** passed.
62
Under the Implied Warranty of Habitability, the landlord has an obligation to maintain the property such that it is suitable for \_\_\_\_\_\_\_\_\_\_\_\_. We do not want conditions that threaten the tenant's __________ and \_\_\_\_\_\_\_\_\_\_.
* residential use
* health
* safety
63
* The tenant __________ waive habitability protection.
* The landlord's failure to comply with applicable ________________ constitutes a \_\_\_\_\_\_\_\_\_\_.
* Applies to ____________ properties, usually multi-family buildings; not \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* cannot
* housing code
* breach
* residential
* commercial properties
64
If premises are not habitable, tenant may:
1. Refuse to pay rent
2. Remedy the defect and offset costs against the rent; or
3. Defend against eviction
## Footnote
*Note: IWH does not require the tenant to vacate the premises*
65
If the tenant chooses to withhold rent, tenant must:
1. Notify the landlord of the problem; and
2. Give the landlord a reasonable opportunity to correct the problem
66
Tenant has a duty to not commit:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Landlords usually require permission before a tenant can cause:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Affirmative Waste
* Permissive Waste
* Ameliorative Waste
* *Note: A landlord can put a provision in the lease prohibiting the tenant from making improvements to the property*
67
In a residential lease, the _____________ is presumed to be responsible for repairs. The tenant must _____________ the landlord of any needed repairs.
* Landlord
* Notify
* Note*: *Landlord is not responsible to repair damages caused by the tenant*
* Note: In a commercial lease, the landlord can place the duty to repair on the tenant*
68
Does the landlord have an obligation to mitigage damages by re-renting the property, if the tenant abandons the property early or is evicted by landlord?
* Majority - Landlord must make reasonable efforts to re-rent the property
* Minority - Landlord does not have to mitigate damages (mostly involves commercial leases)
69
Under majority rule to mitigate damages,
* Landlord must treat leasehold as if it was \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* If the landlord does not make diligent efforts, tenant is __________ from obligation to continue paying rent.
* If the landlord does seek to mitigate, landlord is entitled to the difference between the _________ and the ___________ from the replacement tenant.
* Landlord does not have to accept an \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Vacant stock
* relieved
* original
* rent received
* unacceptable replacement tenant
70
How can the landlord deal with the holdover?
* Evict the holdover tenant; or
* Continue the relationship with the tenant by treating the holdover tenant as a periodic tenant
* Rent is the same amount under the old lease
* *Exception: landlord can impose a higher rent if the landlord had informed the tenant of the increase prior to the expiration of the old lease. *
71
**_Duty to Deliver Possession_**
## Footnote
**Majority Rule**: The landlord must deliver ____________ of the leasehold premises ( __________ of the property)
**Minority Rule**: The landlord only required to deliver \_\_\_\_\_\_\_\_\_\_\_\_.
* Actual possession
* Physical possession
* Legal possession
72
The Landlord must control:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_; and
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Common areas
* Nuisance like behavior of other tenants
73
The landlord does not have to control:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Off-premises actions of third-parties that are beyond the landlord's control
74
The tenant owes ______________ to \_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Duty of care
* foreseeable trespassers, invitees, licensees
75
Landlord is liable (under negligence theory) to invitees, licensees, and foreseeable trespassers for:
* Negligence for **latent or hidden defects** about which the tenant has been warned
* Responsible for **faulty repairs** completed by the landlord or landlord's agent negligently
* Responsible for negligence that causes injuries in **common areas of the property**
76
An **_assignment_** is a ____________ transfer of the tenant's remaining term.
Complete
77
A **_sublease_** is a transfer for ____________ the entire duration of the lease.
Less than (*if the tenant retains a reversionary interest in the leasehold, the transfer is a sublease*)
78
Who may the landlord collect rent from in an assignment?
* The original tenant because they have privity of contract
* The subsequent tenant because they have privity of estate
79
Who may the landlord collect rent from in a sublease?
The original tenant because they have privity of contract and privity of estate
## Footnote
*Note: subtenant only has rent obligations to the original tenant*
80
Can the landlord deny permission to a transfer of the lease?
Majority Rule: A landlord may deny permission to a transfer only for a commercially reasonable person.
Minority Rule: A landlord may deny permission at her discretion which means for any reason or no reason at all.
81
A landlord _________ the tenant's permission before transferring her interest. The new landlord _________ by the terms of the existing lease.
* does not need
* is bound
82
* Who's covered - Primary focus on _____________ residential housing
* Who's protected -
* Sex refers to \_\_\_\_\_\_\_\_\_\_\_\_, but does not include \_\_\_\_\_\_\_\_\_\_\_\_\_.
* Familial status means families that have \_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* What's prohibited -
* Refusing to \_\_\_\_\_\_
* Causation: Prohibited behavior must be linked to the protected basis
* multi-family
* gender discrimination; sexual orientation
* children under the age of 18
* rent
83
* The doctrine of adverse possession allows a person in unlawful _______ to acquire good title to a piece of property.
* When a person acquires title by adverse possession, new title relates back \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Property owned by the government __________ be adversely possessed.
* possession
* to the time the person began adverse possession (entry onto the property)
* cannot
84
What are the elements of adverse possession?
* Continuous for statutory period
* open and notorious
* hostile; and
* exclusive
85
What are the three phases of "Continuous" possession?
1. Entry phase - entrance
2. End phase - statute of limitations runs out of time
3. Middle phase - adverse possessor make use of the property
86
\_\_\_\_\_\_\_\_\_\_\_ or __________ may suffice if the use is ____________ with the type of property being possessed.
* seasonal use
* infrequent use
* consistent
87
What is tacking for the purpose of satisfying the continuity requirement for adverse possession?
If the adverse possessor cannot satisfy the continuity requirement on her own, **she can tack on her predeccesor's time on the property to satisfy the statute of limitations**. To tack the time of adverse possessio of a prior adverse possessor, the **current adverse possessor must be in privity with the prior adverse possessor**.
88
The statute of limitations will not run against a true owner who has **a disability at the time the adverse possession begins**. What are some common examples of disabilities?
* insanity
* imprisonment
* infancy
89
The true owner can interrupt the adverse possession period by ______________ the \_\_\_\_\_\_\_\_\_\_\_\_.
* ejecting
* adverse possessor
90
What does it mean for the adverse possessor's use to be open and notorious?
Use must be such that it would put a **reasonable true owner** on notice of the adverse use, i.e, it cannot be hidden.
91
* What does "hostile" mean for the purpose of adverse possession?
* What are the rules regarding the adverse possessor's state of mind?
* Possession must be **adverse** to the true owner's interest.
* Rules:
* Majority - does not inquire into state of mind
* Minority - two views
* Good faith - require adverse possession based on mistake
* Bad faith - adverse possession based on aggressive trespass
92
What does it mean for adverse possession to be "exclusive"?
If two people adversely possess the property together, can they both acquire title by adverse possession?
An adverse possessor **cannot** share possession with the true owner.
Yes, they acquire title as tenants in common.
93
Typically, the scope of possession traces the legal boundries of the property, except in the case of constructive adverse possession. What is constructive adverse possession?
Adverse possessor enters under **color of title** from an invalid instrument and occupies a **portion** of the property as described in the instrument.
94
Adverse possession includes the legal boundries of the property plus:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Subsurface rights
* Easements
95
What is the doctrine of merger for the purposes of land sale contracts?
Covenants under the contract are **merged **into the deed and therefore **can't be enforced unless the covenant is also in the deed**.
96
What are the three requirements that Land Sale Contracts must satisfy to meet the statute of frauds requirement?
* be in writing
* signed by the party to be charged
* must include essential terms
97
What essential terms are needed to satisfy the statute of frauds?
* Parties
* Description of the property
* Price and Payment info
98
What are the two main exceptions to the statute of frauds requirement for land sale contracts?
* Partial performance
* Detrimental reliance
99
What is evidence of partial performance for the purpose of avoiding the statute of frauds requirement for land sale contracts?
* Payment
* Improvement
* Possesion
*Note: most states require at least 2 acts of performance for the doctrine of partial performance to apply*
100
* What is marketable title?
* Examples of defects in title?
* In judging whether title is unmarketable, the standard is that of a ______________ buyer.
* If the seller cannot deliver marketable title, the buyer's remedy is _____________ of the contract.
* Title is free from **unreasonable** risk of litigation
* Examples:
* title acquired by adverse possession that **hasn't** been quieted
* private encumberances (i.e., mortage, easement)
* public encumberance (violation of a zoning ordinance)
* Reasonable
* Recession
101
The implied warranty of fitness or suitability applies to defects in ___________________ and may be relied upon by \_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* New construction
* Initial homebuyer and subsequent homebuyer
102
Most jurisdictions impose a duty on the seller to disclose \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. We are concerned with:
* _______________ defects
* Defects that _______________ the value of the home, health, and safety of its occupants
* General disclaimers __________ satisfy the seller's duty to disclose
* all known, physical material defects
* latent or hidden
* substantially affect
* will not
103
What remedies are available to the seller?
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Damages (contract price - market price)
* Recission
* Specific performance
104
What are the buyer's remedies if the seller breaches?
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* If the seller breaches in good faith, buyer can only recover \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* Damages (difference between contract price and market price)
* out-of-pocket expenses
* rescission
* specific performance
105
Majority Rule: ___________ holds _equitable title_ during the period between _____________ and _______ and \_\_\_\_\_\_\_\_\_\_\_\_. \_\_\_\_\_\_\_\_\_ is responsible for any damage to the property that happens during the period. As holder of _legal title_, ______ has a right to possess the property
* Buyer
* Execution of the contract
* Closing
* Delivery of the deed
* Buyer
* Seller
106
Places the risk of loss on the ___________ until _______ and \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* Seller
* closing
* delivery of deed
107
What are the two component parts of a Mortgage?
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* Note - borrower's promise to repay
* Mortgage - instrument that provides security to the note
108
What are the two kinds of mortgage:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Purchase money mortgage - to purchase property
* Future advance mortgage - line of credit
109
What are the four alternatives to a mortgage?
1. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
4. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
1. Deed of Trust
2. Installment Land Contract
3. Absolute Deed
4. Conditional Sale and Repurchase
110
Mortgage may transfer the property:
* \_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_ is liable after the transfer unless:
\_\_\_\_\_\_\_\_\_\_\_\_; or
\_\_\_\_\_\_\_\_\_\_\_\_.
* By sale
* By will
* By intestate succession
* Mortgagor
* Release by Mortgagee
* Modification of transferee's obligation by mortgagee
111
What is a due on sale clause?
It gives the lender the option to demand immediate full payment upon transfer (acceleration clause)
112
What is a due on encumbrance clause?
It is an acceleration clause that is activated when the mortgagor obtains a second mortgage or otherwise encumbers the property.
113
If the transferee assumes the mortgage, who is liable for the mortgage upon default? The assumption agreement _______ to be in writing.
The original mortgagor and the transferee.
* does not need
114
If the transferee takes "subject to" mortgage, then:
* Transferee is __________ liable upon default
* If the deed is silent or ambiguous as to liability, transferee is considered to have taken title ______________ the mortgage.
* Is not personally
* "subject to"
115
What is the rule regarding:
* Transfer of the note but not the mortgage?
* Transfer of the mortgage but not the note?
* The mortgage follows the note
* Transfer is **void** because the note is the evidence of the debt; **or** note and mortgage are considered a single entity, thus the note follows the mortgage.
116
In a majority of states, mortgagee/lender is treated as the _____________ on the real property interest that is security for the debt.
holder of lien
117
When can the mortgageee/lender take possession -
* Lien Theory State
* Title Theory State
* Intermediate Title Theory State
* Lien - Until foreclosure
* Title - At any time
* Intermediate Title - Until Default
118
What is the equity of redemption?
Mortgagor must exercise the right of equity of redemption \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
A common law right held by the mortgagor to **reclaim title** and prevent foreclosure upon the full payment of the debt.
* Before the foreclosure sale
119
What is a deed in lieu of foreclosure?
Mortgage can convey the property to the lender in exchange for releasing her from any outstanding debt.
120
A foreclosure is a ___________ of an asset to pay of a debt. Mortgagee must give __________ before foreclosing. Two common methods of foreclosure are ____________ and \_\_\_\_\_\_\_\_\_\_\_\_\_\_. Excess proceeds are used to \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. If the sale produces less than the mortgagor owes, the court can issue a __________________ for the remaining balance.
* forced sale
* notice
* judicial sale
* power of sale (private sale by the lender)
* satisfy the debts of other creditors
* deficiency judgments
121
Interests acquired __________ the interest is being foreclosed (i.e, ____________ interests) survive the foreclosure. Interests acquired ________ the interest is being foreclosed (i.e., ___________ interests) are ____________ by the foreclosure. Surviving debts are satisfied \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* before
* senior
* after
* junior
* extinguished
* chronologically
122
What are the exceptions to the chronological first in time rule?
1. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
4. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
5. \_\_\_\_\_\_\_\_\_\_\_\_\_\_
1. **Purchase-money mortgage exception** - has priority over all mortgages
2. **Recording Act exception** - junior mortgage may take priority over unrecorded senior mortgage
3. **Subordination agreement **- senior can agree to subordinate to junior
4. **Mortgage modifications **- more burdensome modifications are subordinated (original mortgage will remain superior)
5. **Future-advances mortgages** - line of credit
123
Foreclosure _____________ the mortgagor's interest in the property. Except, ___________ enables the homeowner to ____________ the foreclosure and redeem the property **after **the foreclosure sale.
* eliminates
* statutory redemption
* nullify
124
Absent statutory redemption, the purchaser of property at a foreclosure sale takes the property _____________ of any ____________ mortgage and ____________ to any _________ mortgage.
* free and clear
* junior
* subject to
* senior
125
For a deed to be valid, it must be _____________ and \_\_\_\_\_\_\_\_\_\_\_\_\_\_. For the first requirement, the controlling question is whether the grantor had the _____________ to transfer the property.
* Delivery
* Acceptance
* Present Intent
126
* ______________ transfer of a deed is not required
* Be careful with situations where delivery is ________________ or \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* but remember that the grantor can make proper delivery through an \_\_\_\_\_\_\_\_\_\_
* Acceptance is generally presumed provided the gift is \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Physical
* Incomplete
* Seemingly revocable
* Agent
* for Value
127
A valid deed must include:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_
* Identify the parties
* Be signed by the grantor
* Include words of transfer (i.e., granting clause)
* Sufficient description of the property
* No need to be a legal description
* Can be based on monuments or physical attributes of the property
* Can use extrinsic evidence to clarify an ambiguous description
128
Does recording affect the validity of a deed?
No, a deed is valid at delivery.
129
Under common-law, the recording problem is solved by the \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* First in tme, first in right rule (the first grantee to receive a deed wins).
130
Which interests are covered?
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* Deeds
* Mortgages
* Lease
* Option
* Judgments affecting title
* Easements
* Covenants
131
Who is covered by recording acts?
* Subsequent purchasers (i.e., someone who acquires an interest in land)
132
Who is not covered by recording acts?
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_
Grantees who acquire title by:
* Gift
* Intestecy
* Devise
Because we want to protect those who make economic investments by purchasing property
133
What are the three kinds of notice?
1. \_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_
* Common situations when #3 is applied:
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
1. Actual - subsequent grantee has real, personal, knowledge
2. Constructive - prior interest is recorded
3. Inquiry
* When there is someone else using the land
* When there is an interest mentioned in the deed to some other transaction
134
Race Statute
* Rule:
* Key Language:
**Rule**: First to record wins, even if the subsequent purchaser had notice of a prior, unrecorded conveyance
**Key Language**: "first recorded" "first to record"
135
Notice Statute
* Rule
* Key Language
* **Rule**: subsequent purchaser has good title if she buys without notice of a prior, unrecorded conveyance (bona fide purchaser)
* **Language**: "in good faith" "without notice"
136
Race-Notice Statute
* Rule:
* Key Language:
* **Rule**: Subsequent purchaser has good title if two requirements are met:
* Purchase *without* notice of a prior unrecorded conveyance; and
* First to record
* **Key Language**: "in good faith" or "without notice" PLUS "first duly recorded" or "first recorded"
137
Shelter Rule: A person who takes from a bona fide purchaser protected by the recording act has the ____________ rights as his grantor.
A person who takes from a bona fide purchaser by the recording act has the **same** rights as his grantor.
138
Estoppel by Deed: If a grantor subsequently acquires title to the land, the grantor _________ from trying to repossess on grounds that he didn't have _________ when he made the original conveyance.
* Estopped
* Title
139
What is a general warranty deed?
It provides the greatest amount of title protection; the grantor warrants title against all defects, even if the grantor didn't cause the defects.
140
Six Implied Covenants in the General Warranty Deed:
Present:
1. \_\_\_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_\_\_
Future:
1. \_\_\_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_\_\_
Present:
1. Covenant of Seisin
2. Covenant of the Right to Convey
3. Covenant against Encumbrances
Future:
1. Covenant of Quiet-Enjoyment (defend against future challenges)
2. Covenant of Warranty (future assertions of encroachment)
3. Covenant of Further Assurances (future title problems)
141
What is a special warranty deed? Does it include the six implied covenants?
The grantor warrants against defects caused by the grantor. It includes the six implied convenants, but the only apply to the acts (or omissions) of the grantor.
142
What is a quit-claim deed?
The grantor makes no warranties as to the health of the title.
143
Breach of a present covenant occurs at __________ of the conveyance.
at the time
144
Breach of future covenants occurs __________ the conveyance, once there is ______________ with possession.
* after
* interference
145
* **Breach of Covenant against Encumbrances**: Lesser of the difference in value between title with or without the \_\_\_\_\_\_\_, or the cost of __________ the encumbrance.
* **Breach of Covenants of Enjoyment or Warranty**: Lesser of the ________ price or the cost of ________ title that is in fact defective.
* **Breach of Covenants of Seisin, Right to Convey, Further Assurances**: Lesser of the ____________ price or the cost of ___________ title.
* Covenant against Encumbrances:
* Defect
* Removing
* Covenants of Enjoyment or Warranty:
* Purchase
* Defending
* Covenants of Seisin, Right to Convey, Further Assurances:
* Purchase
* Perfecting
146
A ________________ is free to make improvements to the property, including fixtures, subject \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. Holders of a __________ or _______ are limited by the \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* fee simple owner
* governmental land use regulations
* life estate
* tenants
* doctrine of waste
147
The _____________ of real property is generally entitled to the chattel (fixtures), unless the seller reserves, in the \_\_\_\_\_\_\_\_\_\_\_\_, the right to keep the chattel. Life tenants and tenants can remove fixtures they \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, unless doing so would _______________ the property.
* Buyer
* Contract
* Installed
* Permenantly Damage
148
* Old Rule - Trespasser __________ remove any fixtures or improvements that they installed
* New Rule - Trespasser can remove an improvement, or at least recover the value added to the property, so long as they acted in \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
* could never
* good-faith
149
Four types of gifts in a will:
1. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
4. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
1. **Specific** - devise of property that can be distinguished from the rest of the testator's estate
2. **General** - devise of personal property that will be satisfied from the general assets of the estate
3. **Demonstrative** - general devise that is satisfied from a particular source
4. **Resid**
5. **ually** - balance of the estate after all the general and specific gifts have been made
150
Devise of property that fails because \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
it is no longer in the testator's estate at the testator's death (e.g., testator sold it or destroyed it during life).
151
If the testator gives the property to the beneficiary while the testator is \_\_\_\_\_\_\_, the gift is adeemed by satisfaction, i.e., the beneficiary _____________ during the testator's lifetime.
* alive
* takes gift
152
What is a lapse in the context in of devisements?
A devise of property can also fail if the beneficiary dies before the testator dies, and no alternative beneficiary is named in the will.
153
Anti-Lapse Statute Requirements:
* If the lapsed gift was made to a party specified in the statute (\_\_\_\_\_\_\_\_\_\_\_\_); and
* Deceased beneficiary survived by \_\_\_\_\_\_\_\_\_.
If both criteria are met, the gift goes to the issue and does not lapse.
* family member
* issue
154
Person who has the benefit of the trust is the ______________ and holds ______________ and has standing to \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.
Person who has the responsibility for managing the property is the \_\_\_\_\_\_\_\_\_\_\_, who holds \_\_\_\_\_\_\_\_\_\_\_\_.
* Beneficiary
* Equitable Title
* Enforce the Trust
* Trustee
* Legal Title
155
Absolute restraints on alienation are \_\_\_\_\_\_\_\_\_\_.
Partial restraints are _________ if it is for a ____________ and a \_\_\_\_\_\_\_\_\_\_\_\_.
* Void
* Valid
* Limited Time
* Reasonable Purpose
156
Land burdened by the easement:
Servient Estate
157
Land benefitted by the easement:
Dominant Estate
158
What is an affirmative easement?
Affirmative easement gives the holder the right to **do something** on someone else's property.
159
What is a negative easement?
A negative easement gives the holder the right to **prevent** someone from doing something on her land. **Must be express**.
160
What is an easement appurtenant?
An easement appurtenant is **tied to the land**. The holder is benefitted in her **use **of the land.
161
What is an easement in gross?
An easement in gross benefits the holder personally (not tied to the land; there is only a servient estate).
162
Creating an express easement:
* It must be \_\_\_\_\_\_\_\_\_\_\_
* Can be created by a \_\_\_\_\_\_\_\_\_\_
* Subject to \_\_\_\_\_\_\_\_\_\_\_
* in writing
* grant
* recording statutes
163
What is an express easement created by reservation?
An easement by reservation is created when a grantor conveys land but **reserves an easement right in the land for the grantor's use and benefit.**
164
Implied Easements are not: subject to the statute of frauds and subject to recording statutes.
Four Kinds:
1. \_\_\_\_\_\_\_\_\_\_\_
2. \_\_\_\_\_\_\_\_\_\_\_
3. \_\_\_\_\_\_\_\_\_\_\_
4. \_\_\_\_\_\_\_\_\_\_\_
* Easement by Necessity
* Easement by Implication
* Easement by Prescription
* Easement by Estoppel
165
How is an implied easement by necessity created?
An easement by necessity is created only when:
* Dominant and servient estates were owned by one person; and
* Necessity arose when the estates were severed into two seperate estates, and at severance, one of the properties became virtually useless without the easement.
166
How is the implied easement by implication created?
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_\_
* **Common ownership**
* Before division - owner of the large tract uses the land as if there's an easement on it **(quasi-easement)**
* Use must be **continuous**
* Use must be **reasonably necessary** to the dominant estate's use and enjoyment
167
How is an implied easement by prescription created?
* \_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_
* Continuous use for statutory period
* Open and notorious; and
* Hostile
168
How is an implied easement by estoppel created?
* \_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_
* \_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_
* \_\_\_\_\_\_\_\_\_\_\_
* There is a **permissive use**;
* **Reliance** on permissive use (i.e., promise)
* Reliance must be **reasonable**
* **Investment of money in reliance**
* Permission is **withdrawn**
* Reliance was **detrimental**
169
