Real Property Hypo Notes - WIP

Question 1

At common law, a conveyance of property from O “to O and A as joint tenants with right of survivorship” creates a __________.

Answer 1

Tenancy in common.

This creates a tenancy in common because 1) it is not a tenancy by the entirety, which is limited to marriages, and 2) it does not have all four unities required to be a joint tenancy (O owned the property before devising it to himself and A, not satisfying the “vest at the same time” requirement).

Question 2

If A and B own property as joint tenants, and B dies leaving a will devising her interest in the property to C, who owns the property?

Answer 2

A only.

Joint tenancies have rights of survivorship, so when one joint tenant dies, his interest is transferred to the surviving joint tenant. Joint tenancy interests cannot be devised by will, only during life. (This would remove the joint tenancy and create a tenancy in common, however.)

Question 3

How will the proceeds from a partition sale of property initially held by four joint tenants (A, B, C, and D) be divided if A sold her interest to E, and B died, leaving her property to F and G?

Answer 3

C and D get 3/8 each; E gets 1/4

Question 4

If two tenants in common are estranged, and only one tenant ever occupies the property, can the other tenant demand an accounting?

Answer 4

No, because the other tenant had the right to use the property but chose not to do so.

Question 5

What is the lien theory (majority rule on the MBE) in relation to mortgages on joint tenancy property?

Answer 5

When one joint tenant obtains a mortgage on his interest in the land, it does not cause a severance of the joint tenancy.

Under the lien theory, if the joint tenant obtained a mortgage on his interest in the land and then died, the surviving joint tenant would take the title free and clear of the mortgage.

Question 6

What is the title theory in relation to mortgages on joint tenancy property?

Answer 6

When a joint tenant obtains a mortgage on his interest in the land, the joint tenancy severs, creating a tenancy in common.

Question 7

When does total eviction occur for a tenant?

Answer 7

When the landlord or a paramount title holder excluded the tenant from the entire leased premises.

This terminates the tenant’s obligation to pay rent.

Question 8

When does partial eviction occur for a tenant?

Answer 8

When the tenant is excluded from only part of the leased premises.

Partial eviction by the landlord relieves the tenant of the obligation to pay rent for the entire premises, even though the tenant continues possession of the remainder of the premises.

Partial eviction by a paramount title holder results in an apportionment of rent (tenant liable for only the reasonable rental value of the portion that he continues to possess).

Question 9

What is the implied warranty of habitability?

Answer 9

A covenant by the landlord that the premises are suitable for human residence. The standard usually applied is the local housing code.

(e.g., dangerously frayed wiring or faulty plumbing)

Question 10

What is the doctrine of constructive eviction?

Answer 10

If a landlord’s breach renders the premises unsuitable for occupancy, the tenant may vacate the premises, terminate the lease, and sue for damages.

Under the doctrine of constructive eviction, if the landlord’s breach (i.e., doing an act or failing to provide some service that he has a legal duty to provide) makes the premises untenantable, the tenant may terminate the lease and also may seek damages if the following conditions are met:
1) The breach must be by the landlord or persons acting for him.
2) The breach must substantially and materially deprive the tenant of her use and enjoyment of the premises.
3( The tenant must give the landlord notice and a reasonable time to repair.
4) The tenant must vacate the premises within a reasonable amount of time.

Question 11

May a tenant waive the implied warranty of habitability?

Answer 11

NO, because such a waiver is against public policy.

Question 12

If L leases property to T, and L subsequently assigns L’s interest to L2, whom may T hold liable when X, a paramount title holder, ejects T?

Answer 12

L or L2

If L leases property to T, and L subsequently assigns L’s interest to L2, T may hold L or L2 liable when X, a paramount title holder, ejects T. A landlord may assign the rents and reversion interest that he owns. The assignee is liable to the tenants for performance of all covenants made by the original landlord in the lease, provided that those covenants run with the land. The original landlord also remains liable on all of the covenants he made in the lease. X’s evicting T from the entire leased premises breaches the covenant of quiet enjoyment, which runs with the land. Thus, L and L2 are personally liable to T.

Question 13

What happens if a landlord has a covenant against assignment or sublease, but consents to a transfer that violates the covenant?

Answer 13

He waives his right to avoid future transfers.

Question 14

When does a tenancy at will terminate?

Answer 14

Terminates by operation of law if:

1) Either party (T or L) dies;
2) The tenant commits waste;
3) The tenant attempts to assign his tenancy;
4) The landlord transfers her interest in the property;
5) The landlord executes a term lease to a third person.

Question 15

If a landlord makes an contractual agreement for repairs with a tenant, then sells the property to a buyer, but the buyer does not consent to the obligations of the earlier agreement, what is the tenant’s recourse if he needs to enforce the agreement?

Answer 15

The tenant may recover the cost from either the landlord or the buyer.

A LL’s promise in a lease to maintain the property does not terminate because the property is sold. Although no longer in privity of estate, the original LL and tenant remain in privity of contract, and the original LL remains liable to the covenant unless there’s a novation. A novation requires consent of all parties and completely releases the original party, but since the buyer did not consent to be bound by the original contract, there was no novation, and the LL remains bound.

Generally, promises to do a physical act, such as maintain or repair the property, are considered to run with the land.

Question 16

To acquire a prescriptive easement on property, the claimaint’s use does not need to be:

Answer 16

Exclusive

Requirements for prescriptive easements:

1) Open and notorious
2) Continuous
3) Adverse

Question 17

If an easement is said to be surcharged, this means:

Answer 17

The easement’s legal scope was exceeded.

Question 18

Is a long period of nonuse sufficient to terminate an easement?

Answer 18

Yes, if it is accompanied by other evidence of intent to abandon the easement.

Question 19

What are the servient landowner’s rights regarding easement’s by necessity?

Answer 19

They have the right to choose the location of an easement by necessity, which arises when the owner of a tract of land sells a part of the tract and by this division deprives one lot of access to a public road or utility line.

Any alternative routes that the dominant landowner could have taken are restricted by the servient landowner’s choice.

Question 20

In a residential subdivision, will a commercial builder be bound by a residential-use restriction that was omitted from his deed?

Answer 20

Yes, if the builder had inquiry notice of a common scheme for development.

In the absence of a writing, reciprocal negative servitudes may be implied if:

1) There is a common scheme for development;
2) The grantee has actual, record, or inquiry notice of the covenant.

In this case, inquiry notice exists if the neighborhood appeared to conform to common restrictions.

Question 21

What is an equitable servitude?

Answer 21

A covenant that, regardless of whether it runs with the land at law, equity will enforce against the assignees of the burdened land who have notice of the covenant.

Question 22

What is required for the burden of an equitable servitude to run to successors in interest?

Answer 22

1) The covenanting parties intended that successors in interest be bound by the covenant
2) The successor in interest has notice of the covenant if she has given value.
3) The covenant touches and concerns the land.

(Vertical privity between the covenantor and his successors in interest is not required)

Question 23

If the buyer of land determines that the seller’s title is unmarketable, the buyer:

Answer 23

Must notify the seller and give reasonable time to cure the defects.

Question 24

What is the effect on a real estate contract for a property containing a mortgage?

Answer 24

The title may still be marketable, since the seller can use the proceeds to pay off the mortgage simultaneously with the sale.

Question 25

If a seller breaches the implied covenant of marketable sale, what is their option?

Answer 25

The closing date may be extended to allow the seller time to cure.

Rescission is still available to the buyer if they wish, allowing them to rescind the contract, sue for damages for breach, etc.

Question 26

If a seller attempts to sell property they have successfully adversely possessed, is the title unmarketable?

Answer 26

Yes, because there is still a high chance of litigation, even if the seller is likely to win the adverse possession claim.

Question 27

What is the effect of an easement on the marketability of title if it is known to a buyer?

Answer 27

If the easement increases the value of the property, then the title is still marketable.

Question 28

For adverse possession, when is tacking available?

Answer 28

Periods of adverse possession between two successive claimants may be tacked together to make up the full statutory period if there is privity of possession between the claimants.

If one adv. possessor ousted the other, then there is no privity and tacking is not available.

Question 29

O conveys a life estate to A, with a remainder to B.

If during A’s lifetime, X enters into actual, exclusive possession that is open and notorious and hostile for the statutory period, will X obtain title to the land?

Answer 29

No, but X will acquire A’s life estate.

The statute of limitations for AP does not run against the holder of a future interest until her interest becomes possessory. The future interest holder has no right to possession until the prior present estate terminates, and thus no cause of action for ejectment accrues until that time.

Once A dies, X’s interest passes to B.

Question 30

If an adverse possessor uses land in violation of a recorded real covenant for the limitations period, she:

Answer 30

Takes title free of the real covenant.

Question 31

Must a junior mortgagee be named as a party to a senior mortgagee’s foreclosure action?

Answer 31

Yes, because it has the right to pay off the senior mortgage to avoid being wiped out by foreclosure, since foreclosure destroys interests junior to the mortgage being foreclosed.

Failure to join the mortgage results in the preservation of its interest despite foreclosure and sake.

Question 32

Statutory redemption is the right of a mortgagor to recover the land after the foreclosure sale has occurred, usually by paying __________.

Answer 32

The foreclosure sale price.

Question 33

In contrast to statutory redemption, what is equitable redemption?

Answer 33

The right of a mortgagor to recover the land by paying the amount overdue on the mortgage, plus interest, at any time before the foreclosure sale. if the mortgagor has defaulted and the mortgage or note contained an acceleration clause, then the full balance of the mortgage must be paid in order to redeem in equity.

Question 34

When can a mortgagor exercise her statutory right of redemption?

Answer 34

After the foreclosure sale.

The right exists for a fixed period after the foreclosure sale (for states that provide it).

In contrast, all jurisdictions recognize the mortgagor’s right of redemption in equity, which exists until the date of the sale and is cut off by foreclosure. A mortgagor may purchase the land at the foreclosure sale, but a statutory right of redemption provides a grace period after foreclosure when the mortgagor may redeem the property.

Question 35

What is the order of priority for allocating mortgage foreclosure sale proceeds, from first to last?

Answer 35

The foreclosing party, any junior lienors in the order of their priority, and then the mortgagor.

Question 36

If a landowner obtains a mortgage on his property, and then sells the land to a buyer willing to pay on the mortgage, against whom can the mortgagee obtain judgment for deficiency after a foreclosure sale?

Answer 36

Both the landowner and the buyer.

When a grantee assumes a mortgage, the grantee expressly promises the grantor-mortgagor that he will pay the mortgage as it becomes due. The mortgagee then becomes a third-party beneficiary of the grantee’s promise to pay and can sue the grantee directly if the grantee fails to pay. After the assumption, the grantor-mortgagor becomes a surety who is secondarily liable to the mortgagee on the note if the grantee fails to pay.

Question 37

What is a bona fide purchaser, and who can be protected as a bona fide purchaser of land?

Answer 37

A BFP is a purchaser who takes land without notice of a prior instrument and pays valuable consideration.

Donees, heris, and devisees are not BFPs because they do not give value for their interests; i.e., they are not purchasers.

Mortgagees, purchasers from heirs, and donees from a BFP of the land can be protected as a BFP. Under the shelter rule, anyone who takes from a BFP will be treated like a BFP (i.e., will prevail against any interest her transferor would have prevailed against.)

Question 38

What is a notice statute>?

Answer 38

“Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded.”

Under a notice statute, a later purchaser of land will prevail over an earlier grantee if she takes without actual or constructive notice (e.g., record) notice of the earlier grant.

Question 39

What is a race-notice statute?

Answer 39

“Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, whose conveyance is first recorded.”

Under a race-notice statute, a later purchaser will prevail over an earlier grantee only if she takes without actual or constructive notice of the earlier grant and records before he does.

Question 40

What is a pure race statute?

Answer 40

“Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser whose conveyance is first recorded.”

Under a race statute, notice is irrelevant. The first party to record, regardless of the date of her conveyance, wins.

Question 41

O conveys Blackacre to A on Monday. O conveys Blackacre to B on Tuesday. A records on Wednesday. B records on Thursday.

If both parties paid valuable consideration for the land, and neither knew of the other’s deed, who owns Blackacre?

Answer 41

B, under a notice statute.

Question 42

When is a person allowed to convey their homestead?

Answer 42

If it’s a single person, they may convey it whenever they want.

If it’s a married person, neither spouse may sell, convey, or encumber a homestead without a joinder of the other spouse.

Question 43

What debts are creditors allowed to force on a homestead?

Answer 43

Purchase money debts, taxes due on the homestead, improvements on the homestead, owlet of partition, refinance of perviously submitted debts, home equity loams, and reverse mortgage.

Question 44

What debts can creditors NOT force on a homestead?

Answer 44

Common debts, such as gambling debts.

Question 45

What defines a rural homestead?

Answer 45

Contiguous or non-contiguous acreage, with living on party and using the rest in support of the family.

A rural homestead cannot be more than 200 acres for a family, or 100 acres for a single person.

Question 46

What are the primary factors considered in determining whether a homestead has been established?

Answer 46

1) Intent to have it as a homestead
2) Actual occupation or acts of preparation to occupy

Written declaration not required, but can be used to show intent to occupy.

Question 47

When should the affidavit of lien, necessary for perfecting a mechanic’s lien on non-residential projects, be filed?

Answer 47

No later than the 15th day of the fourth calendar month after the day on which the indebtedness accrues.

Question 48

For what projects must notice of a statutory mechanic’s be given TWICE?

Answer 48

Commercial projects, public works projects, temporary event structures.

Residential projects do not require notice to be given twice.

Question 49

What is required to be in an affidavit of lien?

Answer 49

1) A sworn statement of the amount of the claim
2) The name and last known address of the owner or reputed owner
3) A general statement of the kind of work done and materials furnished for which payment is requested
4) The name and last known address of the person by whom the claimant was employed or to whom the claimant furnished the material or labor
5) The name and last known address of the original contracts
6) A description, legally sufficient for identification, of the property sought to be charged with the lien
7) The claimant’s name, mailing address, and, if different, physical address

Question 50

What kind of notice does a quitclaim deed place a grantee on?

Answer 50

Inquiry notice.

Question 51

What is a quitclaim deed?

Answer 51

A transfer of whatever interest the grantor might have.

In Texas, quitclaim deeds place a grantee on inquiry notice of any defect that exist in the chain of title.

Question 52

What recording act does Texas use.

Answer 52

Notice act

Question 53

When is a deed considered effective?

Answer 53

When it is delivered.

Question 54

How does someone establish title by adverse possession after a permissive entry?

Answer 54

Three elements in addition to those that would otherwise be required:

1) Repudiation of the former permissive relationship
2) The repudiation and adverse claim have been communicated to the person who gave permission
3) Adverse possession has continued for the prescribed number of years after that date.

Question 55

When does the permissive use adverse possession time period toll?

Answer 55

After the repudiation and the adverse claim have been communicated to the person who gave permission.

Question 56

To show visible appropriation of land by allowing livestock to graze, an adverse possessor could:

Answer 56

Build a fence demonstrating the land is intentionally enclosed for grazing.

Question 57

What constitutes possession of the mineral interests in a piece of land, for adverse possession purposes?

Answer 57

Drilling and production of the underlying minerals.

Question 58

In Texas, adverse possession must is:

Answer 58

The actual and visual appropriation of real property, commenced and continued under a claim of right that is inconsistent with and hostile e to the claim of another.

This includes the requirement that possession be peaceable, as defined as the element of continuous and uninterrupted possession.

Question 59

Who has the responsibility of plugging old wells?

Answer 59

The operator of a well has the primary responsibility to plus a well, usually within one year from the time drilling or production operations cease.

Question 60

Describe the Duhig doctrine?

Answer 60

The Duhig doctrine applies when a three-party chain of conveyance seemingly results in the conveyance of more than 100% of the mineral (or royalty) interest. The grantor, not the grantee, will bear the loss and lose the interest.

Question 61

What is the Moser exception, and what does it apply to?

Answer 61

The exception applies to the term “minerals” in a conveyance or reservation, and that term includes as a matter of law all substances within the “ordinary and natural meaning” of the term.

Gold and silver are included under the exception, and are not part of the surface estate.

Question 62

What nine substances belong to the surface estate as a matter of law?

Answer 62

1) building stone
2) limestone
3) caliche
4) surface shale
5) water
6) sand
7) gravel
8) near-surface lignite or coal
9) iron ore