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CO Realty > Unit 4: Interests In Real Estate > Flashcards

Unit 4: Interests In Real Estate Flashcards

1
Q

What is an estate in land?

A

It defines the degree, nature, quantity, and extent of an owner’s interest in real property.

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2
Q

Many types of estates exist but…

A

Not all interests in real estate are estates.

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3
Q

To be an estate in land, an interest must allow possession, meaning…

A

The holding and enjoyment of the property either now or in the future, and must be measured according to time.

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4
Q

A freehold estate…

A

Lasts for an indeterminable length of time, such as for a lifetime or forever.

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5
Q

A freehold estate can be a fee simple estate which…

A

Continues for an indefinite period and may be passed along to the owner’s heirs.

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6
Q

A freehold estate can also be a life estate that…

A

Is held only for the lifetime of the person and ends when the individual dies.

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7
Q

What is a fee simple estate, or fee simple absolute?

A

It is the highest interest in real estate recognized by law. It is ownership in which the holder is entitled to all rights to the property by law. It runs forever.

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8
Q

Upon death of a co owner of a fee simple estate, the property interest passes to…

A
  1. The decedent’s co owner if there is one and the co-ownership was accompanied by a right of survivorship.
  2. The person or persons specified in the decedent’s will
  3. If the decedent has left no will, to the person or persons designated by the state’s law of intestate succession.
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9
Q

The right to use a fee simple estate is limited only by…

A

Public and private restrictions, such as zoning laws and restrictive covenants.

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10
Q

What is a fee simple defeasible estate?

A

It is a qualified fee estate that is subject to the occurrence or nonoccurrence of some specified event.

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11
Q

What are the two categories of defeasible estates?

A
  1. Fee simple determinable

2. Fee simple subject to a condition subsequent.

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12
Q

What is a fee simple determinable?

A

It is a fee simple defeasible estate that may be inherited, and is qualified by a special limitation (an occurrence or event).

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13
Q

What is key to creating a special limitation?

A

Language used to distinguish special limitation… words such as “so long as” or “while” or “during.”

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14
Q

What is a possibility of reverter?

A

It is retained by the former owner of a fee simple determinable. If the limitation is violated, the holder of possibility of reverter may reacquire full ownership without legal action or a court.

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15
Q

What is a fee subject to a condition subsequent?

A

This is when an owner real estate on condition of ownership, which means there is a difference in the way the estate will terminate if there is a violation of the condition.

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16
Q

With a fee simple subject to a condition subsequent, the estate does not automatically terminate upon violation of the condition of ownership. Instead…

A

The owner has the right of reentry but must bring a legal action in court to assert this right.

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17
Q

Why are the rights of reentry and possibility of reverter called future interests?

A

Because they are only possible sometime in the future, and may never take effect.

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18
Q

What is a life estate?

A

It is a freehold estate limited in duration to either the life of the holder of the estate or the life of some other designated person or persons.

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19
Q

Unlike other freehold estates, a life estate is…

A

Not inheritable. It passes to the future owner according to the provisions by which the life estate was created.

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20
Q

What is the holder of the life estate called?

A

A life tenant. They are entitled to the rights of ownership and can benefit from both possession and ordinary use, and profit arising from ownership.

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21
Q

The life tenant’s ownership may be sold, mortgaged, or leases but…

A

It is always subject to the finite limitation of the life estate.

22
Q

What is a life estate based on the lifetime of a person other than the tenant called?

A

A life estate pur autre vie (for the life of another). It is often created for people who are physically or mentally incapacitated in the hope of providing incentive for someone to care for them.

23
Q

A fee simple owner who creates a life estate must plan for its future ownership. When the life estate ends…

A

It is replaced by a fee simple estate.

24
Q

The future owner of a fee simple estate is determined in which two ways?

A

Remainder interest - the creator of the life estate may name a remainder man as the person to whom the property will pass

Reversionary interest - the creator of the life estate may choose not to name a remainder man. In that case, ownership returns to the original owner upon the end of the life estate.

25
Q

What is a legal life estate?

A

A life estate that is not created by the property owner, it is established by law.

26
Q

Define dower and curtesy

A

These provide a non-owning spouse with a means of support after the death of an owning spouse.

Dower is the life estate of a wife in the real estate of her deceased husband

Curtesy is the life estate of a husband in the real estate of his deceased wife.

27
Q

States that recognize dower and curtesy provide that a non-owning spouse has a lifetime right to…

A

1/2 to 1/3 interest in the real estate, even if the owning spouse wills it to others.

28
Q

What have most states abolished common law dower and curtesy in favor of?

A

Uniform Probate Code. UPC gives a surviving spouse the right to an elective share on the death of the other spouse, if they are not satisfied with the disposition of the property by will.

29
Q

What is a homestead?

A

It is a legal life estate in real estate occupied by a family as a home. It is protected from most creditors during the occupant’s lifetime.

30
Q

In a homestead situation, what is a portion of the value of the property exempt from?

A

Certain judgements for debts, such as charge accounts and personal loans, but not a mortgage for the purchase or improvement of the property. It is also not protected from real estate taxes.

31
Q

What is required to establish a homestead, depending on the state?

A

In some states, all that is required is for the head of a household to own or lease the premise occupied by the family as a residence.

In other states, the family is required by statute to record a notice of homestead rights.

A family can have only one homestead at a time.

32
Q

What is an encumbrance?

A

An encumbrance is a type of interest in real estate that does not rise to the level of ownership or possession, yet still gives an individual, business, or other entity some degree of control of the property.

33
Q

What is a deed restriction?

A

A private restriction that affects the use of real estate. Once placed in the deed by the previous owner, a deed restriction will run with the land, limiting the use of the property for future owners.

34
Q

What are CC&Rs, and what do they do?

A

Covenants, conditions, and restrictions are used by a subdivision developer to maintain specific standards in a subdivision such as architectural or design specifications for improvements. These restrictions are enforced by the developer, and are filed in the public record in the county.

35
Q

What is an easement?

A

It is the right to use the land of another for a particular purpose.

36
Q

What is an easement appurtenant?

A

It is an easement attached to the ownership of real estate and allows the owner of that property to use the neighbors land.

The parcel that benefits from the easement is the dominant tenement

The parcel over which the easement runs is the servient tenement.

37
Q

Describe a party wall

A

It is the exterior wall of a building or partition wall that straddles the boundary line between two lots.

The individual owners own half of the wall on their lot, and each has an easement appurtenant in the other half of the wall, also called a cross easement.

Expenses for the wall are shared.

38
Q

What is an easement in gross?

A

It is an individual or company interest in or right to use someone else’s land.

Ex. A railroad’s right of way is an easement in gross, also utility rights of way.

39
Q

What is the difference between personal easements in gross vs commercial easements in gross?

A

Commercial easements in gross may be assigned, conveyed, and inherited.

Personal easements in gross are usually not assignable. Generally, personal easement in gross terminates on the death of the easement owner.

40
Q

How is an easement typically created?

A

It is created by a written agreement between the parties that establishes the easement right. It always involves two separate parties.
An easement can also be created by necessity, and by prescription.

41
Q

Describe an easement by necessity.

A

Easement by necessity is created when an owner sells a parcel of land that has no legal access to a street or public way. It is created by court order based on the principle that owners have the right of ingress (enter) and right of egress (exit).

42
Q

Describe an easement by prescription.

A

When the claimant has used another’s land for a certain period of time (typically 10-21 years) an easement of prescription may be acquired. The land use must have been continuous, nonexclusive, and without the owner’s permission. The use must be visible, open, and notorious.

43
Q

Describe the concept of tacking.

A

Tacking provides that successive periods of continuous occupation by different parties may be combined to reach the required number of years necessary to establish a claim for a prescriptive easement.

44
Q

In what 5 ways can an easement be terminated?

A
  1. The need no longer exists
  2. When one of the parties becomes the sole owner of both properties
  3. By the release of right of easement to the owner of the servient tenement
  4. By the abandonment of easement (intention of the parties is determining factor)
  5. By the nonuse of a prescriptive easement
45
Q

What is a license and how does it differ from an easement?

A

It is a personal privilege to enter the land of another for a specific purpose. It is different from an easement in that it can be terminated or cancelled by the owner of the property. If a right is given orally, it is generally considered to be a license.

46
Q

What is an encroachment?

A

An encroachment occurs when a building, fence, or driveway illegally extends beyond the boundaries of the land of its owner.

47
Q

How is an encroachment resolved?

A

The neighbor may either recover damages or secure removal of the structure that encroaches. However, if it exceeds the state’s prescriptive period, it may become an easement by prescription.

48
Q

What is a lis pendens?

A

Latin for litigation pending, it is a notice filed in the public record of a pending legal action affecting the title to or possession of the property. It creates a “cloud on the title.”

49
Q

What are the 4 government powers? (PETE)

A
  1. Police power
  2. Eminent domain
  3. Taxation
  4. Escheat
50
Q

Describe a state’s police power.

A

The power to enact legislation to preserve order, protect the public health and safety, and promote general welfare of its citizens.

51
Q

What is eminent domain?

A

It is the right of the government to acquire privately owned real estate for public use.

Ex. Public housing authority takes privately owned land to build low income housing. Or, railway and utility companies/state highway department might acquire farmland to extend tracks, electricity or highways.

52
Q

Where in the constitution is the concept of “taking” found, and what are the parameters?

A

It is found in the 5th amendment of the constitution.

The owner must be compensated fairly, ideally the owner and the public agency agree on the compensation through direct negotiation.

If consent cannot be obtained, the government agency can initiate condemnation proceedings to acquire the property.

CO Realty (7 decks)

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