Critical Pass - Property
Estates in Land
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Defeasible Fees
A fee simple estate of potentially infinite duration that can be terminated upon the occurrence of some specified event
- I.e., present fee estate vested in some person, who may lose the fee interest upon the occurrence of some event
- Language—requires clear words of intent for the fee estate to be forfeited
- Words of desire, hope, or aspiration are insufficient
Three types of defeasible fees:
- Fee simple determinable—property automatically reverts back to grantor upon the happening of a given event
- Accompanying future interest = possibility of reverter (retained by grantor)
- Fee simple subject to condition subsequent—grantor retains power to terminate grantee’s estate (grantor must take action to terminate; does not occur automatically)
- Accompanying future interest = right of reentry (retained by grantor)
- Fee simple subject to an executory interest—property automatically transfers to a third party (i.e., someone other than grantor) upon the happening of a given event
- Accompanying future interest = shifting executory interest (retained by third party)
See Cards 2–4
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A fee simple estate that automatically terminates and reverts back to the grantor upon the happening of a given event or condition
- E.g., “to A for so long as he practices law”
- If A stops practicing law, property automatically reverts back to grantor
Characteristics:
- Automatic forfeiture—upon occurrence of the given event or condition, the grantee automatically forfeits the estate
- Potentially infinite—duration can be infinite so long as the event or condition does not occur
- Transferable—the fee estate is alienable, devisable, and descendible, subject to the condition
Creation—requires clear durational language
- e., phrases such as “for so long as,” “while,” “during,” “until,” etc.
- Words of desire, hope, or aspiration are insufficient
Accompanying future interest = possibility of reverter
- Grantor retains a possibility of reverter
- I.e., the property may revert back to grantor, but only if the event or condition occurs
- Transferability–grantor's possibility of reverter is transferable inter vivos, devisable by will, and descendible to grantor's intestate heirs
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A fee simple in which grantor retains the power to terminate grantee’s estate upon the happening of a given event or condition
- E.g., “to A, but if he wins the lottery, grantor reserves the right to reenter and retake”
Characteristics:
- Forfeiture not automatic—if the event or condition occurs, grantee still retains title until grantor exercises his reentry right
- This is what distinguishes fee simple subject to condition subsequent from a fee simple determinable (see Card 2)
- Potentially infinite—duration can be infinite so long as the event or condition does not occur
- Transferable—alienable, devisable, and descendible, subject to the occurrence of the given event or condition
Creation—clear durational language must carve out a right of reentry for grantor
- I.e., it must be explicit that grantor has the right to retake upon occurrence of the event or condition
- Words of desire, hope, or aspiration are insufficient
Accompanying future interest = right of reentry
- Grantor retains right of reentry
- Transferability–in most states, grantor's right of entry is not transferable inter vivos but devisable by will and descendible to grantor's intestate heirs
A fee simple that automatically transfers to a third party upon the happening of a given event or condition
- E.g., “To A, but if A is ever arrested, then to B”
Characteristics:
- Automatic forfeiture—upon occurrence of the event or condition, estate automatically transfers to a third person
- Similar to a fee simple determinable, but ownership automatically transfers to a third person, not grantor
- Potentially infinite—duration can be infinite so long as the event or condition does not occur
- Transferable—alienable, devisable, and descendible, subject to the occurrence of the event or condition
- Absolute restraints on alienation are void
Creation—clear durational language is required
- E.g., “To A, but if A gets married, then to B”
- Words of desire, hope, or aspiration are insufficient
Accompanying future interest = shifting executory interest
- The third party holds the shifting executory interest
- Transferable—third party’s interest is alienable, devisable, and descendible
An interest that lasts only for the life of the interest holder
- E.g., O grants “to A for life”; A has a life estate and is the life tenant (LT) until she dies
- Defeasibility—can be defeasible like fee estates (e.g., determinable, subject to condition or executory interest) or indefeasible
- LT has all ownership rights but must maintain property and make reasonable repairs; LT cannot commit waste (see Card 6)
Accompanying future interest—reversion or remainder
- Reversion—future interest in grantor when a life estate does not provide for disposition of property to a third party
- E.g., O “to A for life”; A is the LT, O has a reversion (i.e., property reverts back to O when A dies)
- Remainder—future interest following a life estate that identifies a third person (i.e., the third party has a remainder)
- E.g., O “to A for life, then to B”; A is the LT, B has a remainder (i.e., when A dies, property goes to B)
- See Cards 7–9 on remainders
Life estate pur autre vie (p.a.v.)—a life estate measured by the life of someone other than the LT
- E.g., O grants “To A for the life of B”; A is the LT, holding the property until B dies, at which point property reverts back to O
- Transfer of life estate—creates a life estate p.v. held by transferee (e.g., LT transfers life estate to B; B holds a life estate that reverts to the grantor O when the LT dies)
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A life tenant (LT) cannot commit acts that constitute an unreasonable use of land and/or injure the interests of a future interest-holder
- Doing so constitutes waste, of which there are three types
Affirmative (voluntary) waste—LT cannot consume or exploit natural resources on the land except:
- Where necessary for repairs or maintenance of land,
- When grant expressly gives the right to exploit, or
- If land was used for exploitation of resources prior to the grant
- Open mines doctrine—if exploitation occurred before the life estate, LT may only extract from already-open mines
Permissive waste—harm to property due to LT neglect
- LT has a duty to repair/maintain property up to the extent of income or profits derived from the land or its rental value
- Includes paying taxes, interest on encumbrances, etc.
- Future interests holders who assume LT’s obligations are entitled to reimbursement
Ameliorative waste—LT acts that economically benefit the land Prohibited under common law, but now usually permitted in most modern jurisdictions
See Card 5—Life Estate
A future interest in a third person (other than grantor) that arises immediately upon the termination of a preceding life estate
- E.g., “to A for life, then to B”—A has a life estate, B has a remainder
Characteristics:
- Creation—expressly created in the same conveyance in which the preceding estate is created
- Transferable—alienable, devisable, and descendible
- Cannot cut off or divest an interest held by a prior transferee
Categories of remainders:
- Vested remainders—three types:
- Indefeasibly vested remainders
- Vested remainder subject to total divestment
- Vested remainder subject to open (class gift)
- Contingent remainders—arise if:
- There is a condition precedent to the future interest becoming possessory,
- The future interest vests in an unascertained taker, or
- Both a) and b)
See Card 8—Vested Remainder
See Card 9—Contingent Remainder
A remainder that automatically becomes possessory upon the natural expiration of the preceding estate
- Limitations—vested remainders cannot:
- Be subject to any condition precedent, or
- Vest in an unknown or unascertained person
Three types of vested remainders:
- Indefeasibly vested remainder—becomes possessory immediately upon termination of the prior estate
- E.g., “to A for life, then to B”
- Vested remainder subject to total divestment—subject to some condition subsequent, such that the remainderman could be divested after taking possession
- E.g., “to A for life, remainder to B; but if B weds, to C”
- Vested remainder subject to open (class gift)—remainder vested in a described class of takers, at least one of whom is capable of taking possession (i.e., by virtue of being alive)
- E.g., “to A for life, remainder to children of B and their heirs”
- B has one child, who has a vested remainder subject to open (b/c B may have more children)
- Open vs. closed class—class stays open to allow for future members and closes when no new members can be created (e.g., life tenant dies)
- Rule of Convenience—class closes whenever any member can call for distribution of her share; after-born class members get nothing
- E.g., “to A for life, remainder to children of B and their heirs”
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A remainder will be contingent if it is either:
- Subject to a condition precedent, or
- Created in favor of an unascertained or unborn person
Subject to condition precedent—remainder’s taking is contingent on the prior occurrence of some event or condition
- Once the event or condition occurs, the interest automatically becomes an indefeasibly vested remainder
- E.g., “to A for life, then to B and his heirs when B gets married”
- If B is unmarried at the time of the conveyance, A has a life estate, B has a contingent remainder (b/c marriage is a condition precedent), and grantor has a reversion in case B is not married when A dies; if B gets married he has an indefeasibly vested remainder
Subject to unborn or unascertained persons—a remainder created in favor of unborn or unascertained persons
- I.e., remainder is contingent on grantee being born or ascertained
- E.g., “to A for life, then to B’s heirs”
- If B, remainder is contingent b/c heirs of B cannot be ascertained until B dies
The law has created rules to prevent some consequences that may result from strict application of the estate system’s requirements
Rule of destructibility—at common law, a contingent remainder is destroyed if it remains contingent (i.e., the condition is not satisfied) when the preceding estate ends
- E.g., O grants “to A for life, then to B once he goes to law school”; A dies and B has not gone to law school
- At common law, B gets nothing upon A’s death
- Modern rule—gives a reversion to grantor or grantor’s estate until grantee satisfies the condition
Merger (Shelley’s Rule)—arises when a conveyance attempts to give a life estate to grantee with a remainder to grantee’s intestate heirs
- At common law, the two estates merge
- E.g., O grants “to A for life, then to A’s heirs” and A is alive; at common law, remainder merges and A has a fee simple absolute
- Modern rule—A has a life estate and his heirs have contingent remainders; O has a reversion b/c A could die without heirs
Doctrine of worthier title—arises when grantor creates a life estate in another but creates a future interest in grantor’s heirs
- E.g., O grants “to A for life, then to O’s heirs”
- Under the doctrine, the contingent remainder in O’s heirs is void; A instead has a life estate and O has a reversion
A future interest in a third party that takes effect by cutting short some interest—two types: shifting and springing
- Includes any future interest that is not a remainder
- Look for—indicated by phrases like “but if,” “then to,” “for so long as,” et
- Executory interest holders lack standing to sue for waste
- Transferability—devisable, descendible, and usually transferable
Shifting executory interest—always follows a defeasible fee or vested remainder subject to total divestment
- Cuts short someone other than the grantor
- E.g., “to A, so long as the property is used for storage. But if used for any other purpose, to B”
- A has a fee simple subject to an executory interest
- B has a shifting executory interest—if A stops using the property for storage, A’s interest is cut short (not grantor’s)
Springing executory interest—cuts short a present interest held by the grantor or grantor’s estate
- E.g., “to A, if and when he gets married”
- A has an executory interest
- Grantor has a fee simple subject to an executory interest; if A gets married, possession springs from grantor to A
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No property interest is valid unless it must vest, if at all, no later than 21 years after the death of a life in being at the time the interest was created
- I.e., a future interest is void if there is any possibility, no matter how remote, that it will vest more than 21 years after the death of the measuring life
- Measuring life = a life ”in being” when the interest was created whose actions during life, at death, or within 21 years after death determine whether a future interest satisfies RAP
Analyzing a conveyance subject to the RAP:
- Determine the interest being granted
- Apply RAP to any future interest that is a contingent remainder, an open class gift, or an executory interest
- If conveyance violates RAP, strike only the violating future interest
- What remains = the new conveyance
Note—many states have reformed the common law RAP, providing for an alternative vesting period greater than 21 years
- Unless instructed otherwise, apply the common law RAP
See Card 13—Special Considerations Regarding the RAP
Rights of first refusal & RAP—contingent interests in property (i.e., options and rights of first refusal) violate RAP if they could possibly be exercised outside the time period allowed by RAP
Class gifts & RAP—for class gifts to satisfy RAP, class must be closed with all conditions precedent satisfied for every member
- Rule of Convenience for class gifts may save a class conveyance that would otherwise violate RAP (see Card 8)
- Examples of RAP violations:
- Age contingency beyond 21—a conveyance to an open class is contingent on members reaching an age over 21
- Void under RAP b/c it cannot vest within 21 years of a life in being at the time of creation
- Fertile octogenarian—presumption that any woman is capable of giving birth, regardless of her age or condition
- Age contingency beyond 21—a conveyance to an open class is contingent on members reaching an age over 21
- E.g., grantor conveys “to A for life, then to A’s children who reach age 30.” A is 80, her son is 40. Conveyance violates RAP, as A’s son could die, she could have a daughter at 81, then die when she’s 82. The remaining daughter’s interest will not vest for another 28 years.
Charity-to-charity exception—RAP does not apply to conveyances from one charity to another
Concurrent Estates in Land
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An estate with multiple tenants in which each co-tenant owns a distinct, undivided interest and each has a right to possession of the whole estate
Characteristics:
- Freely transferable—each interest is freely descendible, devisable, and alienable
- Co-tenant interests can be transferred upon death
- Rent—a co-tenant can lease his individual interest, which transfers his right of possession to lessee, but co-tenants have a right to share in rents from third-party lessee
- No survivorship rights—upon death of a co-tenant, her interest does not pass by law to remaining co-tenants
- Partition—a co-tenant may seek judicial partition (i.e., division of property); if not feasible, property may be sold and proceeds apportioned among co-tenants
- Modern law favors tenancy in common; it is the default concurrent estate
See Card 17—Co-Tenants’ Rights & Duties
Creation—four conditions must concurrently exist when the tenants take their interests:
- Time—JTs must take their interests at the same time
- Title—JTs must receive conveyance through the same instrument
- Interest—JTs must take equal and identical interests
- Possession—JTs must have equal possessory rights
- Express intent required—grantor must expressly intend to create a JT; otherwise, a tenancy in common is presumed
- Right of survivorship—if one JT dies, surviving JTs automatically take equal possession of deceased JT’s share
- Transferability—alienable, but not devisable or descendible
Severance & transfer of interests:
- Severance—severance by any JT creates a tenancy in common with respect to the severed interest
- Transfer—a JT interest becomes a tenancy in common upon transfer; this does not destroy the entire JT if two or more JTs remain
- Mortgage—lien theory (majority) vs. title theory (minority)
- Lien theory Jx—JT can take a mortgage on her interest without severing JT (b/c no title passes to mortgagee)
- Title theory Jx—JT is severed if any JT takes a mortgage on her interest b/c title passes to the mortgagee
See Card 17—Co-Tenants’ Rights & Duties
Marital estate, similar to JT, but between a married couple
- Creation—created by conveyance to a married couple and requires the same four conditions as a JT (time, title, interest, possession)
- Tenancy by the entirety is presumed in any conveyance made jointly to a married couple
Characteristics:
- Right of survivorship—property automatically passes to surviving spouse
- No right to convey or partition—one spouse may not unilaterally convey or partition her interest; attempt to do so is invalid and will not destroy the tenancy
- Protected from creditors—creditors of one spouse cannot reach that spouse’s interest; only creditors of the couple (i.e., joint creditors) can reach a tenancy by the entirety
Severance—three ways a tenancy by the entirety can be severed, which creates a tenancy in common:
- Death of one co-tenant
- Issuance of a divorce decree
- Execution by a joint creditor (e.g., foreclosure)
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The following rules generally apply to concurrent estate tenants:
- Possession—each co-tenant has rights to possess the whole
- Rent and profits—a tenant is not required to pay rent or reimburse co-tenants for tenant’s use of land
- But each co-tenant has a right to share in rents from third parties and profits derived from use of land that depletes its value (e.g., timber, oil and gas, mining, etc.)
- Adverse possession—tenant may not acquire title to the exclusion of co-tenants through adverse possession unless the co-tenants are ousted for the statutory period
- Carrying costs—each tenant is responsible for his fair share of taxes, interest, etc.
- Repairs—tenant may seek contribution from co-tenants for reasonable repairs, but must inform co-tenants before making repairs
- Improvements—no right to contribution from co-tenants for improvements; but tenant is entitled to credit for an increase in value attributable to the improvement (and also liable for any resulting loss)
- Waste—tenant can bring an action for waste against co-tenants during the life of the tenancy
- Partition/sale—co-tenants may seek judicial partition; if property cannot be divided, permitted to sell and apportion the proceeds
- Co-tenants can agree not to partition, but only for a limited time (otherwise the agreement is void as a restraint on alienation
Leasehold Estates
An estate in which the tenant has a present possessory property interest and the landlord has a future interest (reversion)
Four leasehold estates:
- Tenancy for years
- Lasts for a fixed period of time
- Requires a definitive beginning and end date
- If duration is longer than one year, lease must be in writing (required under SoF)
- Terminates automatically at the end of the fixed period
- No notice is required
- Also referred to as "estate for years," "term for years," or "fixed term tenancy"
- Periodic tenancy
- Tenancy estate that repeats until terminated
- Tenancy at will
- Either party can terminate at any time without notice
- Tenancy at sufferance
- Tenant has possession by virtue of wrongfully remaining after termination of a lease (holdover tenant)
See Cards 19–21 on Periodic Tenancy, Tenancy at Will, and Tenancy at Suff rance
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A leasehold that is continuous for successive intervals (e.g., weeks or months) until either party gives notice of termination
Creation—can be express, implied, or by operation of law
- Express agreement—conveyed to tenant for agreed interval
- Implication—a lease that does not specify duration, but provides for rent to be paid at set intervals
- Operation of law—two situations:
- Invalid lease—if tenant takes possession despite an invalid lease (e.g., lease violates SoF), periodic tenancy arises upon landlord’s acceptance of payment
- Period of the tenancy is determined by the period the payment covers
- Holdover tenant—if landlord accepts rent from a holdover tenant, a periodic tenancy arises for the period the payment covers
- Invalid lease—if tenant takes possession despite an invalid lease (e.g., lease violates SoF), periodic tenancy arises upon landlord’s acceptance of payment
Termination—tenant must give proper notice, which requires:
- Sufficient time—tenant must give notice one full period in advance; year-to-year tenancies require six-month notice under common law, one month under the modern view
- Effective date—effective date of termination must be at the end of the period of the tenancy
Note—parties can agree to modify these requirements
A tenancy with no fixed duration, terminable by either party at any time without notice
Creation—express agreement
- Without an express agreement, courts will treat the lease as an implied periodic tenancy
Termination—by will or operation of law
- By will—either party can terminate the lease at any time without notice, but a reasonable demand to vacate the premises is usually required
- By operation of law—occurs upon any of the following:
- Death of either party
- Waste by the tenant
- Assignment by the tenant
- Transfer of title by the landlord
- Lease by the landlord to a third party
A default tenancy that arises when a tenant continues to possess property after the lease expires (i.e., a holdover tenant)
Creation—tenant holds possession beyond lease expiration
- The expired lease’s terms and conditions automatically carry over to the tenancy at sufferance
Landlord options:
- Sue to evict, or
- Impose a new periodic tenancy
- Raised rent—landlord can demand higher rent for both the holdover period and any new periodic tenancy if he gave notice of the increase before the lease expired
- Commercial leases—if expired lease was for one year or longer, the new periodic tenancy can be year-to-year
Exception—imposing new periodic tenancy must be reasonable
- New periodic tenancy is unreasonable if:
- Tenant only remains in possession for a few hours
- Tenant is not at fault for delay in vacating (e.g., illness)
- Seasonal leases (e.g., ski cabin, beach house)
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Duty to repair—can be largely modified by lease terms:
- Tenant must maintain premises and make ordinary repairs
- Residential tenants’ duty to repair is modified by the implied warranty of habitability (see Card 27)
- Tenant must not commit waste—three types of waste:
- Voluntary—overt, harmful acts (e.g., removing fixtures)
- Permissive—neglect
- Ameliorative—alterations increasing property value
- Destruction of premises without fault of landlord or tenant
- Common law—tenant held liable for any loss
- Modern law—tenant can terminate lease
Duty to pay rent—tenancy at sufferance arises upon breach
Duty to not use property for illegal purposes—if tenant uses premises for an illegal purpose, landlord may terminate lease or obtain damages and injunctive relief
- Occasional, minor illegal activities do not constitute a breach
Liability to third parties (in tort):
- Tenant may be liable for injuries to third persons from the dangerous conditions within the tenant’s control
Once-movable chattel that is annexed (i.e., affixed) to real property such that it becomes part of the realty
- Often arises with leaseholds, but applies to all real property estates
- Fixtures pass with ownership of the land
- Exception—a life tenant’s representative may remove annexed chattel within a reasonable time after life tenant’s death
Determining whether chattel has become a fixture:
- Intent controls—annexor’s intent is usually determinative
- Fixture almost always arises where annexors affix their own chattel to their own property
- Chattel integrated into a structure (e.g., heating pipes, bricks built into a wall) almost always becomes a fixture
Landlord-tenant
- Agreement between landlord and tenant is controlling, if it exists
- Tenant installation—tenant may remove chattel she installed if:
- Removal occurs before the lease expires; and
- Removal does not cause substantial harm to the property
- If tenant impermissibly removes fixtures, she commits voluntary waste (see Card 22—Tenant’s Duties at Common Law)
If tenant breaches his leasehold duties, landlord’s options depend on whether tenant retains possession (i.e., remains on premises)
Tenant retains possession—landlord may:
- File for notice of eviction, or
- Continue the lease and sue for rent due
Tenant abandons premises—landlord may:
- Surrender—treat the abandonment as tenant’s surrender and accept it, releasing the tenant from the lease,
- Ignore (minority rule)—hold tenant liable for unpaid rent, or
- Re-let (majority rule)—lease premises to new tenants and hold the breaching tenant liable for any losses
No self-help—landlord may not engage in self-help upon tenant’s breach (e.g., forcibly removing tenant or tenant’s belongings, changing locks, etc.)
Security deposit—required at beginning of most leases to secure landlord against damages and/or abandonment
- Landlord must return deposit to tenant once lease terminates
- Landlord may subtract damages she has suffered
Retaliatory eviction—landlord is prohibited from retaliatory eviction if a tenant lawfully reports housing code or other violations
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Landlords have the following implied duties to tenant:
- Duty to deliver possession on first day of lease
- Majority (English Rule)—actual possession
- Landlord must deliver physical possession to tenant
- Minority (American Rule)—legal possession (i.e., right to possess)
- New tenant is responsible for evicting a holdover tenant
- Tenant's remedy for breath = money damages
- Majority (English Rule)—actual possession
- Implied covenant of quiet enjoyment (see Card 26)
- Implied warranty of habitability (residential leases only) (see Card 27)
- Tort liability (see Card 28)
A tenant has an implied right to quiet use and enjoyment of the premises, without interference from the landlord
- Breach may occur by actual or constructive eviction
- Breach may occur by landlord’s wrongful conduct causing loss of use and enjoyment by tenant
Actual eviction—landlord wrongfully evicts or excludes tenant from property
Constructive eviction—landlord’s actions or inactions render the property uninhabitable or unusable
- Elements:
- Breach of duty—landlord breached a duty to the tenant
- Substantial interference—major and/or chronic problems (e.g., leaky roof) are caused by landlord’s wrongful conduct;
- Notice—tenant must inform the landlord and give him a reasonable opportunity to repair; landlord must fail to act meaningfully; and
- Vacate—tenant must vacate within a reasonable period after the landlord fails to repair
A landlord may be liable for injuries occurring on leased property
Landlord is liable for injuries involving:
- Common areas — duty of reasonable care
- Landlord must exercise reasonable care in maintaining and repairing common areas (e.g., hallways, stairs)
- Latent defects — duty to disclose
- Landlord has a duty to disclose hidden defects he should reasonably know of
- Assumption of repairs — negligence standard
- Landlord is liable for harm caused by negligent repairs he chooses to undertake
- Public use — landlord is liable for known defects if he knows the property is for public use and tenant is unlikely to repair
- E.g., concert hall, convention center
- Seasonal or short term lease of a furnished dwelling
- Landlord is liable for defects that cause harm to tenant
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Unless restricted by lease terms, a tenant may transfer her leasehold interest in whole (assignment) or in part (sublease)
Assignment—entire leasehold (both in duration and physical area) transfers from tenant to assignee
- Assignee is in privity of estate with landlord—the two are bound by all covenants that run with the land
- Assignor remains in privity of contract with landlord
- Assignee owes rent directly to landlord, but assignor remains liable for unpaid rent unless landlord expressly releases tenant (novation)
Sublease—partial leasehold transfers from sublessor to sublessee
- Sublessor is in privity of estate and contract with landlord (i.e., relationship between tenant and landlord is unchanged)
- Sublessee pays rent to sublessor as her tenant
- Sublessee is not liable to landlord for rent and is not bound by any lease covenants unless expressly assumed
Assignment/sublease provisions—construed against landlord
- Lease provisions restricting assignment or sublease are enforceable, but generally construed against landlords
- Once landlord gives a tenant permission to assign or sublet, such provisions are thereafter waived
Servitudes
A non-possessory property interest that confers a right to use another’s land
- Servient estate = burdened land
- Dominant estate = benefited land (not always applicable)
Types of easements:
- Easement appurtenant—entitles a dominant estate owner to use a servient estate’s land
- Attaches to the dominant estate and passes automatically (even if not mentioned in a conveyance)
- Easement in gross—entitles an individual or entity (not a dominant landowner) to use the servient estate
- Attaches only to servient estate; there is no dominant estate
- E.g., right to place a billboard on another’s lot, right to run utility line across land, right to fish in another’s pond
- Similar to a license, but irrevocable; may be transferred
- Affirmative easement—entitles its holder to make affirmative use of the servient estate
- Negative easement—entitles its holder to restrict the servient estate from otherwise permissible activities (see Card 36)
Creation—easements may be created by prescription, implication, necessity, or expressly by grant or reservation
- See Cards 32–35
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An easement’s scope is determined by the terms or conditions that created it
- In interpreting an easement’s scope, courts will consider the reasonable intent of the original parties
Expansion
- Easement holders cannot unilaterally expand the scope of their easement (e.g., through overuse or misuse)
- Overuse or misuse of an easement does not terminate the easement
- Remedy for violation = injunction or damages
Duty to repair
- Easement holder has a duty to make repairs if he is the sole user
- If both the servient landowner and the easement holder use an easement, the repair costs are apportioned
Easements may be expressly created by grant or reservation
Grant—an express grant of the easement
- Created by instrument (e.g., written agreement) in which the servient estate owner gives easement to owner of dominant estate
Reservation—grantor conveys title to land but reserves the right to continue using the land for a designated purpose
- Grantor may only reserve an easement for himself
- Void if reserved for the benefit of another
- E.g., O conveys property to A, reserving an easement allowing access to a path across the property
Requirements—express easements must be:
- In writing (otherwise will violate SoF); and
- Signed by the servient estate holder
A process of acquiring an easement; similar to acquiring title by adverse possession (see Card 44)
Requirements—acquirer’s use of another’s land must be:
- Continuous—for the applicable statutory period
- Open and notorious—owner knows or should know of use
- Actual
- Hostile—without owner’s permission
Note—an easement can also be terminated by prescription if the servient landowner interferes with the easement sufficiently to satisfy the above requirements (see Card 36)
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An easement legally implied based on prior use by a common grantor on land subsequently divided into multiple plots
Requirements:
- Easement exists prior to division of a single tract of land;
- Common grantor’s use is continuous and apparent;
- Use is reasonably necessary for enjoyment of the dominant tenement; and
- Parties intended the use to continue after division of the land
Exceptions—easement may be implied without prior use where:
- Subdivision plat—lots in a subdivision are sold with reference to a map plan, or
- Profit à prendre—holder of a profit à prendre has an implied easement to pass over the land’s surface as reasonably necessary to extract materials (e.g., wood, coal)
An easement can arise if access to or from a property is impossible without the easement (i.e., the easement’s existence becomes necessary)
Creation — usually arises when a landowner sells a portion of her property and the resulting division deprives one lot owner of access to a public road or utility
- The owner of the servient estate can choose a reasonable location for the easement
Termination — expires automatically when the necessity ends
Entitles the holder to prevent the servient landowner from engaging in otherwise permissible actions on his own land
Four categories of acts may be prevented:
- Light
- Air
- Subjacent or lateral support
- Stream of water from an artificial flow
Creation—can only be created by express grant (writing signed by grantor)
Note—restrictive covenants are utilized more frequently than negative easements to prevent a landowner from engaging in certain activities on their land (see Cards 39–41)
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Easements may be terminated in any one of the following ways:
- Estoppel — where servient owner reasonably relies on an easement holder’s conduct or representations indicating an intent to abandon the easement; non-use is insufficient
- Necessity ends — easements by necessity expire when the need that created them ends
- Destruction of servient tenement — unless destruction results from willful conduct of the servient owner
- Release — easement holder can terminate the easement by giving a deed of release to the servient tenement owner
- Abandonment — easement is terminated if its holder physically demonstrates an intent to permanently abandon it
- Mere words or non-use are insufficient
- Merger — easement terminates automatically if one person acquires title of both the easement and the servient land
- Re-dividing the merged title will not revive easement
- Prescription — servient owner may extinguish an easement by interfering with it using elements of adverse possession
- Expiration — if easement was established for a set term, or to expire upon stated conditions, expiration of the term or occurrence of the stated conditions will terminate easement
License—a right to use another person’s (licensor’s) land, which is revocable at the licensor’s will
- E.g., oral permission for neighbor to use licensor’s pool, theater tickets (grant a license to ticket holders), right to use a parking lot
- Not an interest in land—license is a privilege, not an interest in land (distinguish from affirmative easement)
- Revocable—licensor may revoke the privilege at any time, unless estoppel applies
- Inalienable—may not be assigned or transferred
- Any attempt to do so revokes the license
- No SoF requirement—a license may be oral or written; they can result from easements that are invalid under the SoF
- E.g., an oral grant of a permanent easement between neighbors may result in a license b/c SoF not satisfied
Profit—a non-possessory property interest entitling its holder to enter a servient estate to remove resources (e.g., minerals, timber, soil, fish)
- All rules governing easements apply to profits (i.e., creation, transferability, and termination)
- Extinguishment—a profit may be extinguished through misuse or overuse of resources on the servient estate
A promise to do or refrain from doing something related to land
- A contractual limitation or promise regarding land
- Note—covenants are not property interests
Real covenant—a covenant concerning real property
- Runs with the land at law—subsequent owners may be burdened by the covenant or may enforce it
- Different requirements apply for burdens and benefits running with the land (see Cards 40–41)
- Affirmative covenant—a promise to do something related to land
- Restrictive covenant—a promise to refrain from doing something related to land
Termination—can occur by:
- Written release,
- Merger of benefited and burdened estates, or
- Condemnation of burdened property
Covenants vs. equitable servitudes—difference is the remedy
- Covenant—money damages
- Equitable servitude—injunction
- See Card 42—Equitable Servitudes
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A successor in interest to the burdened estate will be bound by a covenant if the requirements below are satisfied
Requirements:
- Writing — original covenant was in writing
- Intent — parties intended to bind successors in interest
- Look to language of the covenant; courts are liberal in construing requisite intent
- Touches and concerns the land — covenant must affect parties’ legal relations as landowners (a very low standard)
- Homeowner association fees satisfy this requirement
- Horizontal and vertical privity — must exist between interested parties
- Horizontal privity — relationship between the covenanting parties (e.g., grantor/grantee, landlord/tenant, mortgagor/mortgagee)
- Vertical Privity — relationship between covenanting parties and their successors in interest (e.g., contract, devise, descent)
- Notice — successor in interest had notice of the covenant when she took her interest
A successor in interest to the benefiting estate may enforce the covenant if the requirements below are satisfied
Requirements:
- Writing — original covenant was in writing
- Intent — original parties intended benefit to run with land
- Look to language of the covenant; courts are liberal in construing requisite intent
- Touches and concerns the land
- The covenant must affect parties’ legal relations as landowners (a very low standard)
- Vertical Privity — successors in interest are in vertical privity with the original covenanting parties (e.g., through contract, devise, or descent)
- Horizontal privity is not required for majority of states
Equitable servitudes are covenants enforced in equity against successors through injunctive relief (i.e., injunction is the remedy)
- I.e., a covenant that will be enforced against successors of the burdened land who have notice of the covenant
- Privity is not required to bind successors
Creation—requirements:
- Writing—written promise
- Exception—reciprocal negative servitudes may be implied from a common scheme for development of a residential subdivision (see Card 43)
- Intent—original parties must intend to bind successors
- Touches and concerns the land
- Notice—successors of the burdened land had notice
- Notice not required for benefit to run
Defenses to enforcement—a court will not enforce an equitable servitude if any of the following conditions exist:
- Pervasive changes in the neighborhood
- Estoppel
- Acquiescence
- Unclean hands
- Laches
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If land is subdivided into parcels under a common development scheme, with only some parcels having negative servitudes, these restrictions may be impliedly binding against all subdivided parcels
Allows lot owners to enforce restrictions on the use of property against other subdivision lot owners (enforced through injunction)
- Note — usually arises on exam where an owner divides land into smaller lots to create a common development scheme/subdivision
- A.k.a. "reciprocal negative easement" or "implied reciprocal servitude"
Created through implication if:
- Common scheme — developer evidenced intent to create a negative servitude under a common scheme for all subdivided parcels
- Common scheme may be evidenced through:
- Recorded plat,
- General pattern of restrictions, and/or
- Oral representations to early buyers
- Notice — owner of the subject lot had notice of the covenants in the deeds of other subdivision lots
- Notice may be one of three types:
- Actual — literal knowledge of covenants,
- Inquiry — neighborhood character indicates a common restriction, or
- Record — chain of title for the owner’s lot includes a prior deed containing a negative covenant/servitude
Adverse Possession
A trespasser may acquire title to another’s property without compensation by possessing the property for a specified period, in a manner conflicting with the true owner’s rights
Requirements — trespasser’s possession of the land must be:
- Continuous for the statutory period — possession must be similar to an ordinary owner’s use of the property
- Daily possession is not required if an ordinary user would not use the property daily (e.g., winter cabin)
- Open and notorious — trespasser’s possession must be conspicuous, such that the true owner would know of the trespass if he inspected his property regularly
- Owner need not actually know of the trespasser’s use
- Actual and exclusive — must possess a reasonable portion of the property to the exclusion of the owner and the public
- Hostile — possession must be without owner’s permission
- No knowledge or intent requirement (i.e., trespasser need not intend to adversely possess)
- Leasehold — if a tenant stays in possession after a lease has expired, he is presumed to have permission (i.e., tenancy at sufferance arises, as opposed to the beginning of an adverse possession period)
See Card 45 - Miscellaneous Adverse Possession Rules
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Statute of Limitations (SoL)
- Disability — SoL does not begin to run if the true owner was under some disability when the adverse possession began
- Future interests — SoL does not run against future interest holders until the interest becomes possessory
Restrictive covenants — will not run with the land if the adverse possessor’s use of land violated the covenant; but covenant will run if the adverse possessor’s use complied with the covenant
Color of title — a claim of title to property not actually owned
- Adversely possessing part of the property under color of title is sufficient to acquire title to the entire property
Govt. land — cannot be acquired through adverse possession
Leasing — adverse possessors can lease a portion of the land to a third party and still possess the property
Non-marketable title — title taken by adverse possession is not marketable, unless there has been an action to quiet title
Tacking — adverse possessors can tack together successive periods of adverse possession to satisfy the statutory period, even if successive possession was by different adverse possessors
- Must be successive — there cannot be gaps between periods of adverse possession
- Privity — requires privity between successive adverse holders
- Satisfied if subsequent possessor takes by descent, devise, or by deed purporting to convey title
- I.e., tacking not permitted if one adverse claimant ousts the preceding claimant
Concurrent owners — co-tenants may not adversely possess each others’ interests unless ouster has occurred
- I.e., to adversely possess a co-tenant, the co-tenant must be excluded from the land for the statutory period
- The statutory period begins once exclusion begins
Land Sale Contracts & Conveyances
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Land sale contracts—subject to the SoF and must be:
- In writing;
- Signed by the parties to be bound; and
- Articulate essential terms (e.g., identify grantor and grantee, intent to convey, consideration to be paid, description of the land)
Exception—partial performance
- A land sale contract outside the SoF is enforceable against the seller if the buyer does any two of the following:
- Pays all or part of the purchase price;
- Takes possession; and/or
- Makes substantial improvements
Land sale process:
- Contract—agreement to buy/sell land
- Escrow period—transfer of funds through escrow
- Closing—escrow completion to deed delivery
- Conveyance—successful deed transfer, upon which property is conveyed to the new owner
Equitable conversion—during escrow (after land sale K but before deed delivery), buyer owns the real property, but seller owns personal property (i.e., the right to proceeds of the sale)
- Seller holds legal title in trust for buyer
- Action against seller for claims arising before the K—any judgment against seller is converted into an interest in sale proceeds; judgment is not enforceable against real property (i.e., buyer is protected)
Risk of loss—if property is destroyed before closing through no fault of the parties, buyer bears the risk of loss in most jurisdictions
- Applies even if buyer has not taken possession
- Parties can contract differently
- Seller must credit any insurance proceeds from loss against the purchase price
Death of a party—if buyer or seller dies before closing, rights to the contract pass according to interests held
- Seller ’s interest—passes as personal property
- I.e., seller’s estate can sue for sale proceeds
- Buyer ’s interest—passes as real property
- I.e., buyer’s estate can sue for delivery
Every land sale contract contains two implied promises:
- Promise to provide marketable title
Promise that title will be free from risk of litigation upon closing
- Defects rendering title unmarketable:
- Acquired by adverse possession,
- Encumbered by interests (e.g., servitude, mortgage, future interest); but seller has the right to satisfy outstanding mortgages or liens with sale proceeds, or
- Zoning ordinance violations existing at sale
Can be waived by buyer (but not seller)
- Promise to disclose & make no material false statements
- Seller must not materially misrepresent facts or make false statements concerning the property
Seller has a duty to disclose known, latent material defects, which may be disclaimed if disclaimer is clear and specific
New property — seller/builder is subject to an implied warranty of habitability and fitness/quality in construction
Remedy for breach — buyer must notify seller before closing and give reasonable time for seller to cure defects
- If seller fails to cure, buyer can rescind, file for damages, demand specific performance, or file suit to quiet title
- Merger — if buyer fails to notify seller before closing, contract merges with the deed and seller is not liable
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A deed passes legal title from seller to buyer
Requirements — to be effective, a deed must be:
- Lawfully executed — deed must be signed by grantor and must reasonably identify the parties and the land; and
- Delivered — requires intent to be bound by the conveyance
- Title passes upon effective delivery; cannot be rescinded
- Present intent controls; physical transfer not required
Third-party or conditional transfers — if a deed is transferred with conditions or via a third party, courts look at grantor’s intent and whether she retains control to rescind transfer
Acceptance — grantee must accept the deed; acceptance is usually presumed; non-existent/void entity cannot accept deed
- Rejection by grantee = ineffective delivery
Three types of deeds:
- General warranty — includes six covenants for title (see card 51)
- Special warranty — grantor assures that:
- He has not conveyed the land to another; and
- The land is free from encumbrances attaching while grantor owned the land
- Quitclaim — transfers whatever interest grantor purports to have in property; no covenants included
- I.e., grantor is not even promising he has title to convey
General warranty deeds include six covenants for title:
- Note — these covenants concern condition of title, not condition of the property itself
Present covenants — only breached at the time of delivery:
- Seisin — grantor covenants that he is the rightful owner (i.e., has title, possession) and that deed covers described land
- Right to convey — grantor covenants that he has the right to convey
- Against encumbrances — grantor covenants that the land is free from encumbrances (e.g., servitudes, mortgages)
Future covenants — only breached after delivery:
- Quiet enjoyment — grantor covenants that grantee will not be disturbed by a third party’s claim of lawful title
- Warranty — grantor agrees to defend against lawful claims of title by others
- Further assurances — grantor promises to perform future acts reasonably necessary to perfect the title conveyed
A BFP is one who purchases property for value (i.e., gives pecuniary consideration) without notice of a prior conveyance
- Note — whether a buyer is a BFP is important in the context of recording statutes (see cards 53-54)
Purchasers:
- Includes mortgagees for value
- Does not include donees, heirs, or devisees
- Not protected by the recording statutes unless the Shelter Rule applies (see card 54)
Notice — a buyer has notice of a prior conveyance by any of:
- Actual notice — actual knowledge, from any source
- Inquiry notice — what a reasonable inspection of the land would reveal (regardless of whether buyer actually inspects)
- Record notice — knowledge from a routine title search
- E.g., a previous conveyance properly recorded in the chain of title (not a wild deed)
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If a prior conveyance or interest is not recorded, a subsequent purchaser/mortgagee may be protected under a recording statute
- Level of protection depends on the type of recording statute
Notice statutes — subsequent BFP always prevails
- Whether or not she recorded first, a subsequent BFP always prevails over a prior grantee who fails to record
- Sample language: “No conveyance or mortgage of an interest in land shall be valid against any subsequent purchaser for value without notice thereof unless it is recorded”
Race-notice statutes — first subsequent BFP to record prevails
- Sample language: “No conveyance or mortgage of an interest in land shall be valid against any subsequent purchaser for value without notice thereof whose conveyance is first recorded”
Race statutes — first grantee to record prevails, regardless of whether buyer is a BFP
- E.g., non-BFP purchaser who records first prevails over BFP
- Sample language: “No conveyance or mortgage of an interest in land shall be valid against a subsequent purchaser whose conveyance is first recorded”
See Card 52 - BFPs for Value
See Card 54 - Chain of Title Problems
Issues that can arise with recording statutes and chain of title:
Shelter Rule — one who takes from a BFP will prevail against any interest the transferor-BFP would have prevailed against, even if the transferee had actual notice of a prior conveyance
- Protects donees, heirs, or devisees of BFPs who cannot qualify as BFPs and would not otherwise receive protection under notice or race-notice statutes
Wild deeds — a recorded deed unconnected to the chain of title (e.g., due to a clerk’s filing error or the failure to record a prior deed)
- Record notice cannot be derived from a wild deed
- Wild deed cannot exist in a tract index system
Estoppel by deed — a grantor who conveys title to land he does not then own is estopped from subsequently acquiring the same land
- Title automatically passes to the benefit of grantee
- Prevents one from conveying land they do not presently own and later validly acquiring it (e.g., through a will)
Most real property sales are negotiated by real estate brokers
Seller’s agent (“listing broker”)—broker who obtains listing from seller, i.e., engaged by seller to assist in sale of property
- Has fiduciary duty to seller
- Earns commission from sale of property once the sale closes
- Seller’s agent may still earn commission if the sale fails to close due to seller’s fault (e.g., seller backs out)
Buyer’s agent (“selling broker”)—primary relationship is with buyer, e.g., shows buyer potential properties buyer may purchase
- Typically compensated by receiving a portion of listing broker’s commission, e., gets paid out of seller’s agent’s commission
- Common law—owes a fiduciary duty to seller b/c buyer’s agent is technically a subagent of the seller’s agent
- Modern statutes—requires separate agreement between buyer’s agent and buyer; buyer’s agent owes fiduciary duty to buyer but no fiduciary duty to seller
Duty to disclose—agents have a duty to disclose material information about which they have actual knowledge
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Mortgages
A mortgage is a security interest in land that serves as collateral for the repayment of a loan (a.k.a. “mortgage deed,” “note”)
- Writing required—must be in writing to satisfy the SoF
- Mortgagor = debtor/borrower/landowner
- Mortgagee = creditor
Parties’ rights
- Lien Theory (majority)—mortgagor has title and the right to possession absent foreclosure (see Card 58)
- Mortgagee has a lien, conferring a right to take action for ownership of the land if the mortgagor defaults on the loan
- Title theory (minority)—mortgagee has title to the property during loan term, not mortgagor-borrower
- Intermediate theory (minority)—mortgagor has title and right to possession until default occurs per the mortgage; after default mortgagee has title and right to possession
- Note—unless instructed otherwise, assume lien theory applies on the MBE
Equitable mortgage—debtor gives creditor a deed to his land as collateral for the debt (instead of executing a mortgage)
Acceleration clauses—terms in loan agreements that require mortgagor to pay off full loan immediately if certain conditions are met, e.g., if mortgagor misses too many payments
See Cards 57–59 on Mortgages
Mortgagor transfer—where mortgagor sells property, mortgage remains on the land (i.e., grantee takes subject to the mortgage but is not liable for repayment)
- Mortgagor remains liable to mortgagee for the loan
- Assumption—grantee promises to pay existing mortgage loan
- Grantee becomes primarily liable to mortgagee; original party is secondarily liable as surety
A mortgagee (creditor) can transfer her interest by:
- Endorsing the mortgage note and delivering it to transferee
- Executing a separate assignment of the mortgage interest
Holder in due course—a holder in due course lender takes a mortgage note free of any personal defenses mortgagor could have raised against original mortgagee (e.g., lack of consideration, fraudulent inducement)
- He still remains subject to real defenses (e.g., duress, fraud, etc.)
Requirements for holder in due course status:
- Negotiable note—must be made payable to the named mortgagee;
- Indorsed—note must be signed by the named mortgagee;
- Delivered—note must be delivered to the transferee; and
- Good faith and value paid—transferee must take the note in good faith (i.e., without notice of illegality) and pay value
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Foreclosure—upon default, mortgagee can satisfy debt through foreclosure by judicial action
- Property is sold to satisfy the debt in whole or in part
- Deficiency judgment—if the debt exceeds sale proceeds, mortgagee can file suit against mortgagor for debt balance
- If proceeds exceed the debt balance, junior liens are paid in order of priority
Redemption in equity—at any time prior to a judicial foreclosure sale, mortgagor can redeem the property by paying the amount due
- Equitable mortgage—redemption rights apply to an equitable mortgage situation where creditor appears to hold legal title to the land via a deed
- Statutory right of redemption—some jurisdictions allow mortgagor, for a certain period, to buy back the property after foreclosure sale
Deed in lieu of foreclosure—to avoid foreclosure, mortgagor can agree to give mortgagee deed to property; such transactions will be valid as long as they are fair and reasonable under the circumstances
Mortgagee possession—mortgagee’s right to possession prior to foreclosure depends on the jurisdiction:
- Lien theory—no right to possess prior to foreclosure
- Title theory—right to possess at any time upon demand
- Intermediate theory—right to possess upon default
- Mortgagee can always take possession with mortgagor’s consent or abandonment
- Mortgagee in possession assumes the risk of accounting for rents, managing property, and tort liability to third parties
Priority of creditors—creditors must record their interests
- Recorded interests take priority in the order recorded
- Purchase money mortgages (PMM)—superior to all interests
- PMM = mortgage given in exchange for funds used to buy the property; PMM is given either to the seller as part of the purchase price or to a third-party lender (if both, seller’s PMM is senior to the third-party lender)
- Creditors can agree to subordinate priority to a junior creditor
Junior interests—terminated by foreclosure of a superior claim
- I.e., upon foreclosure, junior interest holders cannot look to the land to satisfy debts
- Junior interest holders can seek a deficiency judgment against debtor, but they have no interest in the subject property
- Necessary parties—junior interests are necessary parties and must be included in a senior foreclosure action
- Otherwise, the junior interest will remain on the land
Senior interests—unaffected by junior interest foreclosures
- Buyer of foreclosed property takes it subject to senior interests
- Buyer is not liable for senior debt, but the senior mortgage remains on the land
Land Rights Incidental to Ownership
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Lateral support—ownership of land includes the right to have land supported in its natural state by adjoining land; landowners can be liable for excavations that cause damage to adjacent land
- Land in natural state—strict liability
- D landowner is strictly liable if excavation damages P’s adjacent land (i.e., D is liable even if he uses utmost care)
- Buildings on land—for D to be held strictly liable for damage to buildings, P must show his land would have collapsed in its natural state (i.e., absent buildings on the land) due to D’s excavations
- Negligence—if D is negligent in excavating, he is liable for loss or damage to adjacent land and buildings even if it would not have collapsed in its natural state
Subjacent support—underground (subjacent) structures must support surface structures existing when the subjacent estate was created
- Subjacent structures include parking garages, tunnels, mines, etc.
- Liability:
- Strict liability—subjacent owners are strictly liable for failure to support surface land and pre-existing surface structures
- Negligence—subjacent owners are negligent for failure to support subsequently constructed buildings
Land bordering watercourses (natural or artificial bodies of water, e.g., lakes and rivers) is governed by either the riparian doctrine or the prior appropriation doctrine
Riparian doctrine — water belongs to those who own land bordering the watercourse. Two theories:
- Reasonable use theory (majority) — riparian owners share rights to reasonable use and are liable to other owners if their use unreasonably interferes with other owners’ use
- Balance utility of use vs. gravity of harm
- Natural flow theory (minority) — riparian owners may be enjoined for any use resulting in a substantial or material reduction in others’ water quantity, quality, or velocity
- Under both theories, natural uses (e.g., household use) prevail over artificial uses (e.g., for manufacturing or irrigation)
Prior appropriation doctrine — water rights are originally acquired by actual use
- Priority of beneficial use determines rights to water
- E.g., first individual to make a beneficial use of water (i.e., productive use) has superior legal right to its use
See Card 62 - Water Rights in Groundwater & Surface Water
Groundwater — water beneath the surface not confined to a known channel (e.g., water in wells)
- Different states use different approaches — most common are:
- Reasonable use (see card 61) — used in many eastern states
- Prior appropriation (see card 61) — used in many western states
Surface water — water from rain, springs, or other runoff that has not yet reached a natural watercourse
- Landowners can generally use surface water as they please, but may be liable for interrupting its flow in a way that impacts other owners
- Liability depends on which theory applies:
- Natural flow theory — owners cannot unreasonably alter natural drainage
- Common enemy theory — owners can do anything to change drainage or combat flow unless it causes unnecessary damage to others’ land
- Reasonable use theory — utility of use is balanced against the gravity of harm from that use
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Zoning
Zoning power — govt. may enact laws to reasonably control land use (cities and counties must be authorized by an enabling act)
- Limitation — zoning ordinances must be reasonably related to the public welfare, not racially discriminatory, and not violate Constitutional or federal statutory rights (e.g., 1st Amendment or Fair Housing Act)
Variances — landowners can get govt. permission to be exempt or vary from literal restrictions of a zoning ordinance
- Requirements — to qualify for a variance, a landowner must show:
- Undue hardship; and
- Variance will not be contrary to public welfare
Nonconforming use — a once lawful existing use for property, now deemed nonconforming under new zoning laws
- Govt. cannot eliminate a use all at once (i.e., “zone out”) unless just compensation is paid
- Govt. may provide the landowner with amortization, whereby govt. will make payments to the landowner over a set period of time until the landowner recoups the value of the nonconforming use
See Card 64 - Special Use Permits & Exactions
Special use permit — certain property uses require a special use permit even where zoning generally allows the type of use (e.g., hospitals and drive-thrus in commercial zoning districts)
Exactions — condition for govt. approval of a new development
- Condition is usually a payment or gift of property to govt. to offset the development’s demands on public services
- E.g., due to population increase from a new housing development, govt. will have to install new bus stops and traffic lights in surrounding areas— govt. can seek some exaction (e.g., payment) from developer
- Requirements — exactions are unconstitutional unless they satisfy the following:
- Nexus— there must be a rational relationship (nexus) between the exaction sought by the govt. and the burden on public facilities; and
- Proportionality — exaction must reasonably relate, in nature and scope, to the impact of the development
See Card 63 - Govt. Zoning Power, Variances, & Nonconforming Uses
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Conflict of Laws
Real property is subject to the law of the jurisdiction where it is situated
- E.g., a dispute over property in CA is generally governed by CA law
- Applies to the disposition of real property, whether by descent, deed, or other method
Ks related to real property — generally governed by the law of the place where the property is situated
- Traditional conflict of law rules may apply if property is merely incidental to a K and the K is of a personal nature (e.g., a license)
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