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Flashcards in Real Property Deck (146)
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1

Types of defeasible fees

1. Fee simple determinable
2. Fee simple subject to condition subsequent
3. Fee simple subject to executory interest

2

Fee simple determinable

limited by specific durational language (i.e., "so long as," "during," "while," "until").
Future interest: possibility of reverter (automatic)

3

Fee simple subject to condition subsequent

Limited by specific conditional language (i.e., provided that, on condition that, but if).
Future interest: right of entry/re-entry/power of termination (must be exercised) (devisable and descendible BUT no inter vivos transfer).

4

Fee simple subject to executory interest

Terminates on occurrence of specified condition and title goes to third party.
Future interest: executory interest (automatic).

5

Life estate

limited in duration by a life. transferable during that time. not devisable or descendible.
future interest: reversion.

6

Life tenant obligations

To the extent the property can produce income, must pay all ordinary taxes on the land and interest on the mortgage. if not income, responsible for taxes and mortgage interest to the extent of the reasonable rental value of the land.
no obligation to insure the land for the benefit of the remainderman, no responsibility for damage caused by third party tortfeasor.ojjj

7

Types of waste

Affirmative waste: over conduct causing decrease in value. (vested remainderman can sue for damages, vested or contingent remainderman can bring injunction). (exception: timber and minerals, necessary to maintain property, in effect when tenancy began).
Permissive waste: neglect to keep up or reasonably protect property. tenant only required to spend amount of income from property.
Ameliorative waste: majority rule allows alteration of structures when necessary for reasonable use.

8

Types of concurrent estates

Tenancy in common
Joint tenancy
Tenancy by the entirety

9

Tenancy in common

unity of possession.
no right of survivorship.
transferrable, BUT right to share in rental income.
most states presume this as default.

10

Joint tenancy

Four unities: Possession, Interest, Time, Title.
Conveyance severs the joint tenancy as regards the transferor.

11

Joint tenancy and mortgages

Lien theory (majority): mortgage is only a lien and does not sever joint tenancy absent default and foreclosure sale.
Title theory (minority): mortgage severs title, converted to tenancy in common.

12

Joint tenancy and leases

Rule 1: lease destroys unity of interest and severs JT.
rule 2: lease temporarily suspends joint tenancy for life of lease.

13

Joint tenancy and killing

Rule 1: killer tenant holds deceased tenant's interest in constructive trust for descendants.
rule 2: felonious killing severs joint tenancy.

14

Tenancy by the entirety

Five unities: Possession, Interest, Time, Title, Person.
Neither party can alienate or encumber without other's consent.

15

Rights of Co-tenants

Not required to share profits from use of property.
Ouster: if denied access, co-tenant can sue for entry and damages for denied use.
Resources: co-tenants entitled to natural resources in proportion to share.
Third-party rents: must share rents with co-tenants based on ownership interest, but can first deduct operating expenses.
Expenses: co-tenant can collect contributions if paying more than his share of necessary or beneficially spent operating expenses, BUT if in sole possession, only the amount exceeding income from use.
Repairs and improvements: no right to reimbursement. BUT, contributions for necessary repairs in action for accounting or partition (minority: separate cause of action for contribution).

16

Duties of co-tenants

No fiduciary duties UNLESS unity of title.
Duty of fair dealing.

17

Partition

All co-tenants EXCEPT tenants by entirety have right to partition.
If division not practicable or fair, property may be sold at public auction and proceeds distributed.
Agreements not to seek partition are enforceable, provided they are clear and with a reasonable time limitation.

18

Types of future interests

Reversion
Possibility of Reverter
Right of reentry
Remainder

19

Survivorship contingency for remainders

Majority: contingency applies at the termination of the interest preceding distribution of the remainder.
Minority: survive only the testator, not the life tenant.

20

Vested remainder

No condition precedent, ascertainable grantee.

Fully transferable inter vivos, devisable, and descendible.

Vested subject to open: class of grantees, some member vested at conveyance. when class closes, those in gestation are at closing are included. (rule of convenience: class closes when any member becomes entitled to immediate possession).
Vested subject to complete: occurrence of condition subsequent completely divests remainder interest.

21

Contingent remainder

grantee is unascertainable OR express condition precedent.

Destroyed if not vested by end of previous estate; grantor's reversion becomes possessory and contingent remainderman gets a springing executory interest.

22

Rule in Shelley's case

If grantor tries to create contingent remainder in grantee's heirs, this is converted into two successive freehold estates, which merge into fee simple absolute.

Abolished in most jurisdictions.

23

Doctrine of worthier title

No remainders in grantor's heirs, instead reversion to grantor.

24

Executory interests

Transferable, subject to RAP.

Shifting: cuts short prior estate created in same conveyance.
Springing: divests the grantor or fills gap in possession when estate reverts to grantor.

25

Transferability of future interests

Vested remainders: transferable inter vivos, devisable, descendible.
Executory interest/contingent remainders: not transferable under common law, but now transferable, devisable and descnedible in most jurisdictions.

Most states permit creditors to reach transferable future interests.

26

Interests subject to RAP

Contingent remainders, vested remainders subject to open, executory interests, powers of appointment, rights of first refusal, options.

NOT reversion, possibility of reverter, right of reentry.

Trust interests are subject.

27

Rule against Perpetuities

Life in being + 21 years.

If no measuring life, 21 years from when future interest is created.

"Vest or fail"

Only the offending interest fails, UNLESS it would violate grantor's intent, in which case entire transfer is voided.

28

RAP and classes

If RAP voids transfer to one class member, then transfer to all class member is also voided.

Exceptions:
1) specific $ amount to each class member;
2) transfers to a subclass that vest at a specific time.

29

Rule of Convenience

Class closes when one member becomes entitled to immediate possession.

30

Exceptions to RAP

charity-to-charity

current tenant's option to purchase property.