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PROPERTY OUTLINE

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Bundle of Rights
a. Right to possess or occupy (limitations: zoning, restrictive covenants, subdivision rules)
b. Right to use as one sees fit (limitations: zoning, environmental regulations, cant be a nuisance)
c. Right to exclude (exceptions: fire, police, health, public accommodation legis)
d. Right to alienate or transfer (limitations: lot-split ordinances, housing discrim statutes, estate and other
taxes)

ADVERSE POSSESSION
1. Concept
a. when prop is unowned, no one has incentive to protect it from exploitation
b. people shouldnt sleep on their rights innocents may rely on appearance of unowned land.
c. Pro-development desire to privilege those who use their real estate
d. Efficiency makes it easy to determine boundary disputes (on the other hand, could just look at title)
2. Title Immune to AP:
a. Govt land (bureaucracy prevent govt from watching all their land)
b. Torrens real estate
c. Future interests exception is if the future interest was created after the AP went into possession.
AP take the land as she finds it.
d. Disability if O is a minor, insane, imprisoned for less than life, or at war, the SOL is tolled. If
disability occurs after AP goes into possession, SOL is not tolled.
3. Two requirements:
a. SOL must run
b. Five elements
i. Actual possession Look to nature of the land. This is what a reas owner would do w/
respect to this real estate (seasonal, geography). There can be constructive AP when theres
color of title and actual possession of a piece of it. (Monroe v. Rawlings)
ii. Open & notorious form of constructive notice.
iii. Exclusive: regarding the true owner. Courts may allow some use of land by third parties
(Nome 2000 picking berries).
iv. Hostile (4 possible approaches)
1. W/o the owners permission no intent required.
2. Claim of right meaning the AP must think she owns it in good faith.
3. Intentional wrong-doer.
4. Intent to claim as ones own.
v. Continuous Through SOL. Depends on nature of land. (Monroe v. Rawlings)
1. Tacking doesnt matter if record owner changes, but if AP changes, the new AP
must be in privity w/ old AP, in order for their time to be tacked together.
Privity is established by:
a. Will/ intestate succession, parent to child
b. Intervivos prop is transferred to 2nd AP (questionable if oral).
c. Test that can be used for all elements: did AP act toward the land as if he owned it?
4. Defenses:
a. Going to court stops the running of the SOL.
b. If the true owner grants AP permission to be there AND AP accepts it.
c. Ejectment: person out of possession of real estate brings action against a person in possession,
claiming better right to title.
5. Offenses
a. Quiet title action: asks ct to declare that the person out of possession has no right to the land.
b. Ouster: the wrongful dispossession of a rightful owner or tenant, forcing this party to bring a
lawsuit to regain possession.
Monroe v. Rawlings (84) Wild land case. MI hunters ejectment v. quiet title action. Def bought tax deed (color of
title) to whole area of land, and used a small piece of it (= constructive possession). Ct found that defs owned land even
though pl claimed defs never improved land, there was still actual possession: defs used land as a true owner would.
Nome 2000 v. Fagerstram (88) Hostility. Alaskan natives. O brings ejectment suit. Hostile here means only that AP
occupied land owned by another w/o the owners permission he acted toward the land as if he owned it.
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Joseph v. Whitcombe (hand-out) City island squatter. Ct holds that defs are trespassers. NY requires claim of right and defs
knew house wasnt theirs. Presumption of permission in sparsely populated state a presumption of AP in urban areas.
Mannillo v. Gorski (96) Def AP made additions over onto neighbors prop, but was not aware she was over the boundary
no intent. Hostility no intent required. There is no presumption of notice w/ small encroachments unfair to make O
survey land that closely. So question here is whether there was actual knowledge. If not, defs are trespassers. If so,
consideration should be paid for the conveyance of the tract to the encroacher.
Wright v. Wright (104) Father and son, tenants in common. Father dies and interest in prop goes to wife and other children.
There can only be AP against a co-tenant if AP effects an ouster, retains exclusive possession after demand, or givces his
cotenant express notice of AP (bringing it home or unequivocal hostile acts). Exclusive possession, payment of taxes or
making improvements do not necessarily establish an ouster, but acts such as selling or leasing part of the premises do
(even though other tenants may not know of the sale). Presumption exists that a cotenant in exclusive possession is not
holding adversely to his cotenants, but for the common benefit. Co-tenants knew of hostile character of Aitcheys
possession here AP wins.
TRANSFERRING PROPERTY
1. Intervivos
a. Contract of sale earnest money contract
b. Deed 30-60 days after earnest $ k, closing happens and a deed is transferred (must be in writing)
c. Involuntary transfer:
i. If seller backs out before closing, ct can execute a deed or force the seller to write one.
ii. Default on mtge, foreclosure sale.
iii. Condemnation/ eminent domain.
iv. Jment lien if lien is not paid, creditor can have an execution sale (sheriff sells realty).
Jment must be recorded in the county where land is located.
v. Adverse possession.
2. Testamentary transfers
a. Non-probate transfers
i. Concurrent estates
1. Joint tenancy
2. Tenancy by the entirety
ii. Payable on death bank accts
iii. Trusts
1. Settlor has legal title; trustee has equitable/ beneficial title.
iv. Life insurance
b. Probate
i. Wills
1. Law of state where real prop is located will govern validity of will re: realty; law
of testators domicile at the time of death controls wills disposition of personalty.
2. Revocation of Will
a. Write a new one with a revocation clause
b. Physical destruction of will (dicey if other copies exist)
c. Divorce or in some states, marriage revokes a pre-existing will
3. Forced share in some states, a surviving spouse not in the will can elect to have a
forced share, what they would have gotten if testator had died intestate.
ii. Intestate succession
1. Heirs someone who takes under intestate succession according to statute. Mostly
heirs get percentage interest in everything. State is ultimate heir is there are no
others.
2. Consanguinity same blood. Adoptees considered consanguine, not step-children.
a. Lineal descendants or ancestors
b. Collateral siblings, aunts, cousins
3. Affinity related other than blood in-laws.
4. Per stirpes a person who takes by representation ex. 2 children each get half of
the whole share left to their parent.
5. Per capita prop split equally.

PRESENT ESTATES
1.

2.

3.

4.

5.

Fee Simple Absolute


a. To A = words of purchase: describe and identify the person(s) who take the estate
b. And his heirs or for life = words of limitation: describe or limit the estate which is transferred
c. Words of inheritance: describe the inheritable estate.
Fee Simple Defeasible
a. Subject to condition subsequent: estate becomes vulnerable to being terminated when event occurs.
i. Right of reentry/ power of termination owner must enforce. O can sell this possibility.
ii. Waiver if O doesnt try to enforce right of entry after a reas period of time, it can be waived.
A conversation by original owner approving new owners breaking condition can waive right,
esp. if new owner relies on this statement.
iii. O has a right to rents from the time he tried to exercise his entry.
b. Determinable estate: estate ends automatically upon the happening event, reverts back to grantor
i. Language used: so long as, until, during the time that, and specifically providing for
automatic termination upon the happening of the contingency and reverting in the grantor.
ii. Mesne profits continued possession by former owner of a determinable fee after it has
terminated gives the grantor a right to mesne profits (reasonable rental value of the land) for the
period of wrongful possession. Owner of right of entry has no such right.
iii. CA Statute FS determinable and possibilities of reverter are abolished. Estates that are FSD
are deemed to be FS subject to a restriction in the form of a condition subsequent. Right of
entry lasts for 30 years and then must be renewed.
c. Executory interest future interest in a third party
d. Restrictive covenant: ambiguous words of condition creating a contractual obligation. Appropriate
remedy for breach is damages or injunction.
Fee tail and predecessor fee simple conditional (little contemporary significance)
a. To A and the heirs of his body grantor wanted land to come back to him/ successors if that line of
descent ran out. Fee simple condition that A have heirs of the body. Bar the entail - English courts
rebelled, and held that when A had an heir, he could alienate a fee simple.
i. Reversion in conveyor/ successors; remainder in a grantee other than the taker of the fee tail
b. Most states render traditional fee tail obsolete
i. Most common approach: converts what would have been a fee tail into a fee simple in the first
grantee name in the deed or will. Any remainder created to follow the fee tail is construed as an
executory interest in fee simple to become possessory if the first taker dies w/o lineal
descendants.
ii. Next most common approach: changes fee tail into a life estate in the first grantee named in the
will or deed, with a remainder in FSA to the lineal descendants.
iii. Fee simple conditional
Life Estate
a. For the life of the transferee by deed only. Right to use land, but not to exercise dominion over it. Owner
must consider rights of future owners.
i. Sometimes To A for the life of another or pur autre vie
ii. Trust separation of legal and equitable ownership. Trustee has legal title, assuming the
obligation to preserve and manage property, to distribute net income and ultimately pay over the
trust as directed by the owner. Beneficiaries get equitable ownership.
Leasehold Estate (nonfreehold estates)
a. Chattels real they are regarded as personal, not real, property.

FUTURE ESTATES (Condemnation, transfer, waste)


1. Grantors interest
a. Possibility of reverter: whats left in a grantor after transferring a fee simple determinable
i. Some states limit the life of the possibility of reverter or the power of termination.
ii. Other states disregard any condition which has become nominal and is of no substantial benefit
to those who favor the condition.
iii. CA legislation (1982): FS determinables and possibilities of reverter are abolished and now
deemed to be a FS subject to a condition subsequent w/ a power of termination in grantor.
b. Right of entry/ power of termination: whats left in grantor after transfer of a fee on condition subsequent
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c.

2.

i. Right of entry is exercised most commonly by bringing an action for recovery pf possession.
Other ways are: the grantor may give notice to the grantee, or by physical entry on the land.
ii. Exercise of the right to re-enter for breach of condition may be barred by waiver, election, or
estoppel. Waiver/ election are the same; they need not be express and neither is subject to the
writing req of the State of Frauds. Some courts hold that mere failure of owner to exercise the
right of entry w/i a reas time after learning of the breach will bar the grantor from subsequently
exercising the right. The owner of the defeasible estate is more likely to avoid forfeiture if he
can show a substantial change in position in justifiable reliance on the failure of the owner of the
right of entry to exercise his right w/i a reas time after learning of the breach.
1. Defense of estoppel may be available to the former owner of a defeasible estate if he
substantially changes his position in reliance on a representation, express or implied,
by the owner of the possibility of reverter that he does not intend to assert his rights
after the terminating event has occurred.
2. when a breach of condition or terminating event occurs, some states may allow the
owner of the defeasible estate to obtain equitable relief against forfeiture mainly after
a breach of condition, not if a fee simple determinable has expired naturally.
Reversion any future interest created in a grantor that is not A or B.
i. Most commonly, when a grantor who holds FSA conveys to someone else a lesser estate such as
a fee tail, life estate or a fixed term lease. A grantor with less than FSA can also retain a
reversion i.e. a leaseholder who sublets.

Third party interest fee simple subject to an executory limitation


a. Executory interest- a future interest created in someone other than a grantor that is not a remainder
i. remainder take effect in possession at the expiration of the preceding estates, while exec interets
take effect in possession by divesting (cutting off prematurely) the preceding estate.
1. a springing exec interest diverts a posssessory estate in the conveyor or his/her
successors
2. a shifting exec interests diverts a future estates.
b. Remainder
i. Four rules:
1. Must be created at the same time and by the same doc that creates the prior estate(s)
2. Must follow a life estate
3. Must not have the capacity to cut short the prior estate(s)
4. Must be no built-in time gap btw the termination of the prior estate and the remainders
taking of possession
ii. Vested remainder (any remainder that is not contingent)
1. Indefeasibly vested remainders remainders which are certain to become possessory,
and also certain not to be prematurely cut off or cut down in size.
2. Remainders vested subject to complete defeasance
a. Condition precedent v. condition subsequent?
i. if the conditional language comes in a later clause than the lge
creating the remainder itself, it is most likely a condition subsequent
ii. if the conditional lge come before lge creating remainder, it will
likely be a condition precedent
iii. when there is doubt, the courts prefer a vested construction
3. Remainders vested subject to open (or partial defeasance)
iii. Contingent remainder
1. the taker of the remainder is unascertainable
2. the remainder is subject to an unfulfilled condition precedent
3. alternative contingent remainders express condition for both possible takers,
reversion remains in grantor.
4. Destructibility of contingent remainders: a continent remainder must vest on or before
the termination of the previous estate, if it does not, it is destroyed.
a. contingent remainder can also be destroyed by failure to vest before an
artificial termination of the preceding estate such as by forfeiture or by merger
b. merger of the life estate with the reversion could destroy both of the
contingent remainders. Exception: where all interests were created
simultaneously, the vested estate did not merge so as to destroy the contingent
remainder. p.265
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c.
d.
e.

Exception: destructibility rule is not applied where the contingent remainder


was in the form of a beneficial interest under a trust.
Destructibility is different from failure of a contingent remainder
some states have abolished destructibility

Wood v. Board of County Commissioners of Fremont County - courts dont want land tied up
Pls contend that lge in the deed created a FS determinable or FS subject to a condition subsequent with a right of
reversion in them if the land ceased to be used as a hospital. Ct reasoned that conditions tending to destroy estates like
conditions subsequent are not favored by law. Lge here is ambiguous and does not clearly state an intent of the grantors to
retain a discretionary power to reenter the land if the land ceased to be used for the state purpose. Policy reason: deed was
written 40 years ago, there was reasonable compliance with the condition, but now the land should be free.
In Re .88 Acres of Property
Land donated to town on condition that it be used for a meeting house. The town had used the property for 70
years in an adverse manner. However, a public statute said that the recovery of lands must be commenced w/i 15 years of
the cause of action accruing, except for lands given to a public use. Policy rule: the intention behind this rule was to not
allow publicly-owned lands to go into private hands through AP. It should not prevent towns from adversely possessing
property. Court held that the statute referred to the use made of the property by the legal owner, not the trespasser, so after
the property reverted to the heirs, the property was no longer given to a public purpose by its legal owners. Tricky!!
3.

Direct Restraints on Alienation


a. Direct restraints are usually void
i. Disabling restraint void
ii. Forefeiture restraint FS determinable or subject to condition subseq: if A attempts to transfer
w/o Os consent, A forfeits title. If limited in time or scope can sometimes be upheld. Forfeiture
and promissory restraints on alienation of leasehold interests is valid.
iii. Promissory restraint grantor seeks to create a contractual promise by grantee not to convey an
interest. Void when not limited in time or scope.
b. Multiple owners
i. Action in partition physically breaks up land or forces sale.
ii. Cts rarely order a partition sale of future interest land.

4.

Protection of Future Interests


a. Law of waste restricts a possessor in her use if her possessory estate is limited. The holder of the future
estate may protect its value by limiting the diminution in value which the current owner may cause.
i. Waste: unreasonable use of property by current owner which reduces value of a future estate
ii. voluntary waste: intentional acts which will decrease the value of the future estate
iii. permissive waste: failure to act when law imposes duty to. Permitting the property to decrease
in value for want of those day-to-day repairs a reasonable person would make in maintenance.
iv. Owner of a defeasible fee estate is chargeable for waste only if her conduct is unconscionable or
if a reasonable probability exists that the future interest will become a present owner
v. Remedy: damages, injunction and rarely, forfeiture of estate

Brokaw v. Fairchild (p.289) Law of waste. Pl has a life estate in a fancy house on 5th avenue. Pl wants to tear down house
and build a building with apartments. Defendants/ remaindermen assert that the proposed demolition is waste because it
would impair the value of the adjoining properties, and the building itself. Original owner clearly left plaintiff not just a
plot with improvements on it, but also his residence.
The demolition would be an exercise of ownership and dominion. It would change the inheritance so that it could
not be delivered to the remaindermen. Even though the apartment building could be more profitable to the remaindermen,
they have a right to object. Demolition would be an act of waste. Plaintiff claims that the house had become valueless for
the purpose of a residence property since it was isolated and surrounded by factories and railroads. Court found that this
was a valid argument, but that the house was not isolated and that it was desirable as a residence.
Baker v. Weedon (p.296) Unproductive property. Owner to Anna for life, then to Annas issue, if any and if none, then to
my grandchildren from 1st marriage. Feds pay 20 k to build a highway on land, money split btw present owner (Anna) and
future interest owners (grandchildren since Anna had no issue). Anna wants to sell land but grandchildren do not.
Ct says: courts of equity have discretion to order partition. However, ct holds that some of the land should be sold
and the interest off that money can be used to support Anna. Sale of all of the prop would impinge on the vested rights of
the remaindermen. In what kind of case would the court order partition, accelerating the future interest? When the land is
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not producing enough income to pay taxes and maintain the prop. A second consideration is whether a sale is necessary
for the best interest of all the parties.
Beach v. Beach (hand-out) No partition of non-concurrent interests 19 acres in rural CO; log home owned by daughter.
Parents built an addition on the house in accordance with an oral agreement allowing parents to live there until death. To
Mom for life, remainder to daughter. Mom then tries to sell her interest. A state statute says: actions for partition of
private property may be maintained by any person having an interest in such prop.
Ct reasons: statute only authorizes partition of present, not future interests Non-concurrent interests are not
partitionable. The practical result of allowing partition where physical division is impossible due to a lack of concurrent
interests, is that one party can force the other to liquidate her property interests. As a result, a partys right to enjoy her
interest is destroyed and her only remedy for the lost interest is an inadequate dollar amount. Ct holds: It might be easier to
sell the land because no one would buy it seeing that the daughter owns the surrounding prop, so daughter could just buy it.
However, the court decides not to get involved, lets them work it out themselves.
Some courts will order a sale of non-concurrent interests if statute authorizes it using present and future values.
CONCURRENT ESTATES
1. Marital estates
a. Curtesy (common-law): Life estate in surviving husband. Must have had issue by H born alive. All
lands of which W was seized at any time during marriage (unless released). H must elect between
Ws will and curtesy only if will intends such election.
b. Dower (common-law): Life estate in surviving wife. 1/3 of lands of which H was seized at any time
during marriage (unless released). Inchoate dower until assigned by court after Hs death.
c. Election against will (modern statute): Fee simple in survivor of real and personal property owned at
death or conveyed by gift in fraud of marital rights. 1/2 of estate or 1/3 if there are lineal
descendants of decedent. Survivor must forgo all benefits under decedents will in order to claim.
d. Augmentation of estate causing all property (both real and personal) to be put together, and then
spouse takes share of that. Can work for or against spouse.
e. Fraud on marital rights gifts w/o both H + Ws signatures, not transactions at fair market value.
2. Joint tenancy: To A and B, not as tenants in common, but as joint tenants with right of survivorship.
a. Four unities: (Formalistic approach, not intent) unities of time, title, interest and possession.
Interests of joint tenants must arise at the same time and by the same instrument. They must acquire
identical interests and share a common right of possession and enjoyment. Lack of any of these
unities results in a T/C.
b. Severance if one joint tenant conveys his interest to a 3rd party, the latter acquires an interest as
tenant in common w/ the remaining joint tenant(s), who if more than one, continue as J/T. The right
of survivorship is destroyed btw the old tenant(s) and the new. The interest of any joint tenant is
freely alienable inter vivos.
c. Undivided right to possession can be partitioned either voluntary or any joint tenant or tenant in
common has a right to partition when he can enforce by judicial proceeding leading to a partition
in kind or partition of the proceeds.
d. Partition in kind or by sale court may deny partition when inequitable. Moreover, the transferor of
land in J/T may use language restraining partition. If a reasonable restraint, courts will uphold. i.e.
condominium.
3. Tenancy by the entirety: To H + W. Or to H + W as tenants by the entirety.
a. a concurrent estate that can only exist btw husband and wife. Similar to J/T with 4 unities and right
of survivorship. Different from J/T in that it is not severable. Each person has an undivided 1/2
interest.
b. Prop can only be transferred with consent of both H + W.
c. Divorce estate converted into either a J/T or a T/C
4. Tenancy in common: To A and B.
a. No right of survivorship and only unity of possession is required. A tenant in common is the owner
of an undivided fractional part of the whole every tenant has right to possess entirety of land. Most
states have a preference for a tenancy in common unless the intention of the grantor to create a J/T
and not a tenancy in common is clearly expressed. To A and B creates a T/C.
Crowther v. Mower (p.318) Recording the deed = needed for severance? Decedents husband v. decedents son. Nellie
sent a quit claim deed to son for 1/2 interest & told him to record deed after she died. Pl husband claims transfer is invalid
because son didnt record it till after death.
Ct. says: you dont need to record a severance for it to be valid. Most people do record land transfers in order to
protect it from 3rd parties. Nellie tried to have it both ways. She didnt want son to record the deed because if husband died
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first, she wanted to keep J/T so that she would get his land. If she died first, then she can claim that J/T was severed when
she transferred the land to her son and since the right of survivorship is destroyed, her son gets the land.
CA statute: Severance by deed or written instrument occurs by
a) delivering a deed/ conveying land
b) duly acknowledged/ notorized written instrument
c) you can record up to 7 days after death when a person is dying, if the act of severance
takes place not earlier than 3 days before death
Both have to be recorded in CA, but you dont have to let the other party know. However, of course the other party will
know since you have to record it before death. This prevents parties from having it both ways a la Crowther v. Mower.
Patience v. CA (told to us in class) Joint tenant becomes terminally ill and delivers a deed about 2 weeks before he dies.
However, the deed is taken to the Recorders office and stamped an hour after the joint tenant actually dies. Court holds
that J/T was not severed.
Phillips v. Nyhus (p.322) Does the act of entering into a contract to sell J/T property sever the J/T? No. Business partners
acquire land as J/T and then enter into an earnest money contract to sell the land. Contract was signed by sellers and
purchaser. Before closing the deal, Phillips dies.
Formalistic approach: no violation of unity of interest interests of both joint tenants changed in the same way
Intent approach: What were the instructions before closing? Write a check to each of us? Or write a check to us
for the total which we are going to deposit in a J/T bank account.
Ct finds no severance. No evidence on the record indicating that they intended to sever the J/T.
Albro v. Allen (p.326) Non-severable joint tenancy.
2 kinds of J/T one characterized by four unities: interest, title, time and possession. Each joint tenant shares in
possession of the entire estate and is entitled to an undivided share of the whole. Right of survivorship may be destroyed
by severance either by conveyance by either party, or by levy and sale. Remaining joint tenant and the grantee become
tenants in common.
2nd J/T is the to A + B for their lives, remainder to survivor = non-severable J/T in some states, similar to
tenancy by the entirety but alienable on one partys decision. A co-tenant can transfer his interest in the J/T, he wont
destroy the cotenants contingent remainder, however, upon the death of either of the orig. cotenants, the other cotenant, or
the person to whom she has transferred her contingent remainder, takes the whole estate.
Porter v. Porter (p.331) Whether the J/T with the right of survivorship was destroyed by a divorce. Not necessarily
interest is not tied to marriage. Divorce automatically severs a tenancy in the entirety.
The mere temporary division of property held by joint tenants without an intention to partition will not destroy the
unity of possession and amount to a severance of the joint tenancy. Majority rule: no presumption of severance on divorce.
Minority: presumption of severance when divorce decree contemplates a permanent dissolution.
Brant v. Hargrove (p.336) Can a mortgage severe J/T? Not where both parties sign parties have no intention to give away
property. If a unilateral action, severance occurs at the foreclosure sale.
Lien theory unity of interest not violated. Can be a double-edged sword for the lender if the mortgaging joint
tenant is the first to die interest all goes to other joint tenant. But pro-lender result if non-borrower dies interest all goes
to borrower and lender s have a lien on the whole thing.
Title theory lenders have a legal title (title and right to immediate possession) and unity of interest is broken.
Borrower then only has equitable title, although non-borrowing joint tenant still retains legal and equitable title.
Non-formalistic intent approach: did party intend to sell the property?
Esteves v Esteves (p. 355) One family house owned by tenancy in common btw parents and son. Son moved out and then
tried to collect rent. Court found that there was no ouster, and therefore, no entitlement to rent.
1. Accounting - on a sale of commonly owned property, owner who has paid less than his pro-rate ashare of
operation and maintenance expenses must pay out his share. (doesnt matter if one is out-tenant and the other
an in-tenant)
2. Contribution all tenants in common have right to occupy all of the prop. If one chooses not to do so, he
doesnt have the right to charge rent to the others. You can get contribution for 1/2 of taxes or mtge.
3. Partition on a final accounting following sale, tenant who has been in sole possession who demands
contribution towards operating and maintenance costs, must then allow a corresponding credit for the value of
his sole occupancy of the premises. One who seeks equity must do equity.
Carr v. Deking (p. 358) Son and father own farm as tenants in common. Father enters into a lease with George 1/3 of
crops paid as rent. Son protests, wants cash rent. When one co-tenant signs al ease, does it bind the other tenant? Court
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finds that co-tenant cant eject leasee but can opt in to the lease OR he can seek partition. If the non-signing tenant
received any benefits from the lease he consented.
Massey v. Prothero (p. 363) Siblings inherited land in probate. One sibling failed to pay prop taxes, Leiws bought the prop
at a tax sale. Other sibling tries to reinstate interest by paying part of the taxes. Court holds that Lewis was acting as
siblings agent when he bought the land. Theyre blood relatives who received their interest from the same intrument.
If a 3rd party had bought the land, the co-tenancy ceases to exist.
Delfino v. Vealencis (p.368) 3 co-tenants, 1 want partition in kind. 2 brothers wants partition by sale, they think sisters
garbage biz on land depresses sale value of adjoining prop. Ct: partition by sale is inappropriate person opposing partition
by sale is stronger: theres a (rural) presumption in favor of partition in kind. Before ordering partition by sale, it has to be
in the best interest of the parties and if physical attributes of land make it impractical or inequitable to split it up.
Coraccio v. Lowell (p.374) H + W own a home as tenants by the entirety. W/o Ws knowledge or consent, H mortgages the
house. W brings an action against H and bank to have the loan declared a nullity. If we were in a pure tenants by entirety
juris, nothing happened. Court in MA holds that there is a valid mtge although unilateral. However, H can only convey his
interest which is only the right of survivorship, not the right of possession. If H dies before W, bank gets 0.
Lakatos v. Estate of Billotti (p. 378) One should not profit from ones wrong. Uniform Probate Code: when A kills joint
tenant, s/he severs the estate. Presumption that killer pre-deceases victim and all prop passes through victims estate.
SEPARATE PROPERTY (v. community property)
ii. prop owned before marriage
iii. prop received as a gift, during marriage (will, intestate succession)
iv. income/ rents from separate prop
Presumption that prop acquired during marriage is community (i.e income). Presumption in general towards community
property. Commingling = when separate and community prop are intermingled. Transmutation = spouses conversion
of separate into community property or vice versa (either by contractual agreement or gift).
1. Wills: in community prop states, surviving spouse has no right to elect against the will, no forced share
2. Intestate succession: surviving wife gets all of community property and an intestate share of other prop
3. Divorce: 1/2 and 1/2 on community prop, separate goes with owning spouse. Court s will often look at all the
prop to make an equitable division carte blanche.
4. Control during marriage: joint control over community prop/ indu control over separate prop. With
community-owned personal prop either spouse can deal w/ 3rd parties and bind the other spouse
5. Rights of creditors: in a common law state with no community prop, a creditor can only collect in the owing
spouses name. In a community prop state, if debt is created for a family purpose, creditor can reach spouses
separate and all of the comm. prop. If its not a comm. purpose, creditor can only reach 1/2 community prop
and separate prop.
LANDLORD AND TENANT
1.

Modern lease: entails paying rent on an installment basis. Ldld has right to rents and reversion. Tenant has a
rental obligation and a right to possess.
a. Types:
i. Estate for years/ fixed-term tenancy terminates by expiration, surrender, release
(conveyance by ldld to tenant of ldlds interest), or by condemnation.
ii. Periodic tenancy indefinite period/ must be terminated in writing.
iii. Tenancy at will created by agreement btw parties, lasts as long as agreement does. No
formal notice of term required.
iv. Tenancy at sufferance created by one entering into possession rightfully and retaining
possession wrongfully until ldld demands possession or elects to have a dift tenancy. This
kind of tenancy prevents AP unless ldld elects to treat T as a trespasser.
b. Identified by
i. Intention expressed by parties regarding duration/ terminability of tenancy
ii. Agreement by parties concerning periodic payment of rent
iii. Acts of parties such as tenants taking possession of land w/ consent of owner.
iv. Reqs?
- Rent is not required leasehold need not be supported by consideration, it lies in
grant. But unless expressly indicated, cts will find an implied obligation.
- Leasehold arises not on execution of lease, but on taking of possession.
8

c.

2.

3.
4.

5.

6.

L&T Duties
i. I.W.O.H. residential leases (Hilder)
ii. Implied covenant of quiet enjoyment Majority rule: implied in every lease.
- Ldld will not personally or by agent wrongfully interfere w/ tenants possession
- No 3rd person w/ a better right of possession than T will disturb Ts possession.
- Duty to give possession/ have premises open for possession at start of term
- Violated by: partial actual eviction or constructive eviction ( in later case, T must
leave premise immediately to claim benefit) (Barash)
- Minority rule: requires that ldld deliver only the legal title to possession. Going to
ct to eject a holdover is new tenants responsibility.
iii. No implied covenant to operate - tenant has no duty to occupy the premises nor use them
for any particular activity unless expressly stated (Woolworth)
iv. No implied covenant that premises are suitable for their intended purposes (Service Oil)
v. Implied duty to repair? Limited for T: wind + water tight (Hadrian). T has duty not to
commit or permit waste.
Remedies for breach of duties
a. Cts are often unwilling to excuse perf of tenants duties when there is a breach of ldlds duty =
doctrine of independent covenants
b. Damages
i. Diff btw contract rent and fair value of premises
ii. Diff btw value of premises if they had been as warranted and the actual value of premises
iii. Percentage reduction in rent
c. Termination
d. Rent withholding
e. Repair and deduct
Residential lease: tenants cannot waive their rights. Rent= monthly payments.
Commercial lease: whatever parties agree to, cts will enforce. Rent= percentage of revenues and fixed rent.
a. Triple net lease where ldld has no obligations except the right to collect the rent. T may agree to
repair or replace both structural and non-structural elements of the premises, pay taxes and ins.
i. Lge must be specific. If ambiguous, cts look to length of lease, amount of rent, intent of
parties (Hadrian v., Schwartz)
b. ground lease person who wants to build on it leases it
c. Tenant fixtures: chattlel affixed to the real estate in a perm way becomes part of it. In a silent lease,
L gets to keep improvements/ structures that T builds except for trade fixtures. T can remove these
as long as he doesnt damage structure/ or repairs.
Security Deposits
a. Sec deposits cover damages to premises and back rent.
i. Accting for the deposit: Ldld forfeits sec dep if he doesnt provide in writing an acting for
the deposit w/i 30 days after vacation (Garcia v. Thong).
ii. Penalty if ldld wrongfully withholds sec dep he may be liable for 2x amt.
b. Tenant has right to impose ordinary wear-and-tear.
c. CA: at most 2 months rent and 1st month rent.
d. Interest: most states requires interest paid on sec dep.
e. Inspection: T has rt to walk thru premises w/ ldld no earlier than 2 wks before end of lease
f. Transfer: L1 and L2 are jointly and severally liable on residential sec deposits. If commercial lease,
deposit does not touch and concern the land unless L uses it.
Transfer - Both ldlds and tenants interests are alienable.
a. Assignments
i. Transfer of the entire remaining time of the term.
ii. Normally assignee makes payments to ldld and bonus value payments to tenant. Bonus
value when right to possess exceeds the rental obligation.
iii. Privity: Assignee is in privity of estate w/ ldld but not privity of contract (Tenant remains in
privity of k w/ ldld). Assignee is liable for and gets benefit of the vast majority of lease
provisions, but tenant remains liable for all lease promises. Ldld has 2 deep pockets to turn
to jointly and severally liable.
iv. Landlords options
- Majority: Lessor may arbitrarily refuse to approve proposed assignee/ sublessee,
including to recapture bonus value as long as no-transfer provisions in lease are
suitably specific.
9

a.

Strong minority rule: commercially reas objections to assignment are


required (Kendall v. Pestana): financial solvency of assignee, suitability
of the use of prop, nature of the occupancy.
Reliability ldld can assess reliability of assignee

Sublettings
i. Privity - subleasee has no privity w/ ldld in this case.
ii. Req to create a subletting:
- Reversion before lease ends (ACS just 2 days before lease ended)
- Minority position includes: right of entry retained
c. Running Covenants because assignee comes into privity of estate w/ ldld, she become liable to
perform covenants of lease that run with the land. Original tenants continuing obligations under
privity of contract are secondary. If assignee defaults in performing a running covenant, the ldld can
compel original tenant to perform but tenant then has a cause of action for reimburs from assignee.
i. Personal promises do not run w/ lease unless T2 agrees to assume all the provisions of the
master least (assumption).
ii. Touch and Concern promises that touch and concern lease run with it
- If promise made either ldld or ts interest more valuable
- If promise is intimately bound up w/ the lease
- If the avg reas assignee believes that he was bound by the promise (best test)
d. Forfeiture restraint this is valid on a leasehold if for a short period of time.
7. Termination
a. Required elements:
i. Writing must be written notice
ii. Specifically directed to tenant or ldld
iii. Signed by person giving notice
iv. Clear evidence of intent
v. Effective date must be specified (at least 30 days notice)
vi. End of the rental period
vii. Must be received by party outside of the notice period (Davidson v. Kenny)
b. If tenant holds over landlord can
i. Treat him as a trespasser
ii. Raise rent
iii. Do nothing new periodic tenancy is then created
c. Abandonment and surrender ldld can
i. Accept abandonment as surrender everyone is off the hook. No damages.
- Minority: L re-entering premises after offer of surrender = acceptance of offer,
unless L indicates in writing that he is re-entering for Ts benefit and holding
tenant to the lease.
ii. Keep lease in effect hold tenant to it and sue for accrued rent. Ldld assumes no duty to
mitigate and premises belong to T. Ldld must be careful not to look like hes accepting
offer of surrender.
- Put into a lease an acceleration clause reduced to present value
- Anticipatory repudiation: by leaving premises and not paying rent, T is signaling
that is never going to perform. Result is same as accel clause.
iii. Opt to mitigate T is liable for damages, but lease is no longer in effect. Ldld bears burden
as to whether he made a reas attempt to mitigate. Some juris impose duty to mitigate.
Penalty for not mitigating when theres a duty to:
- Subtract from k rent what a reas attempt to mitigate would have yielded
- Or cant recover from T at all.
d. Vacating tenant: cts focus on pre-vacation period (damages calculation) or post-vacation period (in
this case, cts only award bonus value and add-ons)
e. Tenant stops paying rent/ unlawful detainer action: ldld if there has not been a violation of iwoh,
then jment of eviction. If there IS a violation of iwoh, ct will give tenant reas time to make up
arrearages and order ldld to make repairs or ct will not make tenant pay rent until ldld makes repairs
or ct will collect rent until place is up to code.
Receivorship statute tenants get together and file a civil action. If ldld doesnt make repairs, ct will appoint a 3rd party to
take over management.
b.

10

Friend v. Gem (p. 397) Lease (right to possess) v. license/ easement (right to use). Def was discount chain (as a licensor or
ldld?) and entered into an arrangment with smaller retailer (lesser? Licensee?) EE of pl slips on puddle and falls. If Def
was a licensor, std of care is lower. If its a lease, ldld owes a negligent std of care. What cuts against this being a lease?
no fixed space
space is moveable at defs request
defs EEs go into pls space to check the cash register (larger biz has some control over their premises)
contract says license
Ct says this only evinces intent, but doesnt bar it from being a lease. Purpose of agreement here was to grant pl dominion
over a definite space not to render a service but to sell its own merchandise.
David Properties v. Selk (p.407) Ct. concludes that mo-to-mo tenancy was created. Silence was deemed acceptance of
ldlds offer. Old man was a periodic tenant because after end of lease, he did not respond to ldlds letter establishing rent.
Ldld had multiple options when pl continued to live on prop after termi of lease:
1. treated pl as a trespasser and sued for damages (reas rental value and special damages) or maintained an
action for immediate possession.
2. waived the wrong and treated pl as a tenant, demanding increased rent
Adrian v. Rabinowitz (p.415) Majority: implied covenant of quiet enjoyment is deemed to be in every lease and ldld must
deliver actual physical possession, not just right to possess. Ldld has access to information about out-standing tenant and is
in a better position to prevent that tenant from holding over.
1. Ldld has obligation to deliver possession
2. once delivered, ldld has an obligation not to interfere w/ tenants possession and to make sure that no third
person who has a better right to possession than the tenant will disturb his possession
Mercury Investment v. Woolworth (p. 421) Big commercial tenant drafted the lease, holds the bargaining power. Whether
a tenant in a retail lease must operate the premises or can they just pay rent and leave the place vacant. Implied covenant
to operate? Nope, in the absence of a contractual duty to operate, T doesnt have that duty, nor the duty to use the premises
for a particular activity.
Damages would be too speculative. Ldld wont know the kind of traffic the anchor tenant would have drawn.
Express covenants to operate are rare. If there was, some cts would grant injunctive relief on the theory that damages are
incalculable and supervision would be difficult. In this case, the store could purchase injunction from ldld.
Service Oil v. White (p. 429) Suitability covenant. Seller knew about ordinance requiring gas pumps to be 10 ft off the
street. In a commercial lease, whether there is an implied covenant that the premises are suitable for their intended purpose
usually NO. T usually takes full risk as to fitness of the premises no implied warranty of suitability. Caveat emptor.
Ct holds that there was fraud/ concealment here, so tenant wins anyway. Failure to disclose alone does not make
fraud the condition must also not readily be able to be discovered. Tenant couldve gotten out of lease, but he stayed in
and def paid damages ($ to move pumps and maybe punitives).
Hadian v. Schwartz (p. 438) Covanent for Repairs. Attempt by ldld to transfer incidents of ownership to tenant for term of
lease (net lease) earthquake retrofitting. In a commercial lease, is there an implied duty on the part of the ldld to make
repairs? Reas wear and tear is accepted. Tenant has no duty to repair but also cant act wrongfully to create voluntary
waste or permissive waste. wind + water tight = tenants limited duty of repair. Act of God? Tenant is still on the
hook for the lease, even though bldg is gone (unless you were on an upper floor, for example, or lease clause releases you).
In this case, lease would have had to say tenant liable for retrofitting, regardless of cost in order to make this an actual
net lease. Ct looked at intent of parties:
1. do repairs exceed the total value of the lease?
2. length of lease only 3 yrs total
3. relationship of benefit to lessee v. reversion
4. structural or non-structural
5. does T have to cease operations during repairs
6. did parties contemplate this situation = intent
Barash v. PA Terminal (p. 447) Implied covenant of quiet enjoyment. Tenants obligation to pay rent is dependent on
ldlds compliance with ICQE. Ldlds can protect themselves against independent covenant by using specific lge: ldld can
terminate contract/ lease whenever tenant breaches any of leases provisions (contract law). Partial actual eviction violates
the implied covenant. Tenant can 1) terminate lease and sue for damages or 2) stay in premises and stop paying all rent
until partial actual eviction ends. Constructive eviction tenant must leave premises promptly in order to claim this.

11

In Barash, high-rise in NY, ldld turns off a/c at night. Absence of fresh air a violation of the implied covenant?
Ct holds that this is constructive eviction, but tenant didnt leave promptly. If there was an express clause to provide fresh
air, this promise is independent from the obligation to pay rent.
Hilder v. St. Peter (453) Implied warranty of habitability. Hilder moves in, nothing works. She didnt leave so theres no
constructive eviction. 14 months later, she left. Ct held that the state of disrepair reduced the value of the leasehold and
thus constituted a breach of the implied warrant of habitability, awarding damages- reimbursement of all rent paid.
Jack Spring (462) When can you assert a violation of the i.w.o.h Every state has summary proceedings (to get rid of a
tenant in unlawful detainer) to avoid self-help repossession by ldlds.
Garcia v. Thong (480) Security Deposit. Pl sues def for damages but never sends the required letter to pl explaining why
hes not getting his sec deposit back. Ct: Owner forfeits rights to hold deposit if he fails to send written notice he also
forfeits the right to assert an independent action against tenant.
ACS (521) Long-term grocery store lease; ldld is a trust. ACS has labor difficulties and is going out of business. ACS
assigns lease to a grocery-wholesaler and then asks consent of ldld. Ldld wont consent, so ACS drops assignment and
subleases to wholesaler. Subleasing was probably allowed under the lease in case grocery wanted to incorporate a small biz
(Starbucks). Maybe ct should have been less formalistic, and looked to intent.
Kendall v. Pestana Ct wont let ldld deny consent to assign due to bonus value. Ct reads in which consent should not be
unreasonably withheld minority approach.
Abbott v. Bobs U-Drive (593) Ldld suspects that Pl is avoiding rent by renting cars to public owned by Continental. Ct:
there is an implied meaning that any burden that touches and concerns the lease will transfer to Continental. Since the
dispute is about rent, it definitely touches and concerns the lease.
Chesapeake Bldg burns down. Chesapeake agreed to maintain the casualty ins, but hadnt so L sues them. Ct held that
promise did not touch and concern the land because it was for Ls personal benefit.
Textile Factory example - T5 failed to pay rent and is broke so L sues T4 for rent. Once T4 transfers and assigns, all hes
liable for is the rent that accrued on his watch. If T4 has assumed he would have acquired privity of contract (liable for
every promise in the lease). Assumption goes backward and forward liable for whole term of lease.
Gerber v. Pecht (605) Original T assigns to T2 who assigns to T3. T3 assumes/ agrees to be bound by all the terms of the
lease. Ct holds T liable for T3s failure to pay rent. T2 is only liable for rent that occurred on his watch no privity of
contract w/ ldld.
Davidson v. Kenny (540) Termination. Pl owns small bldg and finds out def (mo-to-mo T) is trashing the place. Def sends
notice that lease will end on Sept 30, but letter doesnt arrive until Sept 6. Def doesnt vacate until December. Ct says lease
never terminated. Notice is construed strictly against L because of potential for double damages (if T holds over, he
becomes a trespasser). Minority rule: late letter becomes effective for the next month/ period automatically.
Sommer v. Kridel (571) Duty to mitigate majority rule in residential laws, about half states apply this to commercial
leases.
EASEMENTS
Non-possessory interest in real estate. They give rights of use and run with the land.
1. Basics
a. Easement in Gross: when no land can be identified that the easement benefits, serves the holder
personally. Ex. Oil pipelines.
i. Commercial ones are transferable but personal ones are not (ex. Fishing rights).
b. Profits: right to remove substance from land (minerals, timber) usu accompanied by easement rts.
c. Appurtenant easements are usu. moored to an estate but it doesnt have to abut the easement.
d. Duration easement for years (fixed period) or easement for life or perpetual easement
2. Creation expressly created, must be in writing
a. Deed: together w/ an easement for roadway purposes over adjoining land.
b. Reservation: reserving, however, an easement for roadway purposes over adjoining land.
i. Cts are suspicious of this, esp impt to spell out easement rights in this case
12

ii. Servient easement must be sufficiently described (Berg v. Ting)


Created by implication
i. Implied by prior use = quasi-easement. It requires:
1. Ld had to have been initially in common ownership
2. Quasi-easement must have existed prior to split
3. Had to be apparent before the split (did parties intend it?) (Campbell)
4. Must be reasonably necessary
5. Some courts also require that it be continuous/ intended to be permanent
d. Implied by necessity
i. Requirements:
1. Unity of title
2. That dominant estate has been severed from serviant tract
3. Reas necessity must have exist at the time of severance (basis o which to infer
intent to preserve access)
4. Only lasts as long as the necessity lasts
5. Strict necessity (land-locked) v. reas necessity (make effective use)
6. Public policy
a. Pro-development
b. Pro-conservation or if easement is granted, party should pay
e. Created by prescription or adverse use
i. Requirements:
1. Hostile/ non-permissive use Os protest strengthens APs claim
2. Open and notorious
3. Continuous (depends on nature of easement)
a. Interrupted by
i. lack of privity btw APs
ii. permission offered and accepted
iii. Filing suit
iv. Putting a fence across easement (unless torn down)
4. NOT relevant: exclusivity, color of title
ii. Pre-scription lost grant theory means theres an assumption that there was once an
easement grant/ pre-existing writing if there is an easement
iii. Presumption: w/ rural land that is not fenced in, usage by 3rd parties is presumed to be
permissive. (Hester v.Sawyer) If urban land, usage is presumed to be adverse.
f. Scope of Easements
i. Surcharge when holders use of easement exceeds the terms of the orig grant and
interferes unreas with the owners rightful use of his land.
ii. Violation of purpose of the easement
1. Look first to language of easement, then to circumstances surrounding the
conveyance, including parties conduct both prior and subseq to grant
iii. Quantity overall burden cannot be increased.
1. No glom-on rule the extension of an easement to additional land is misuse
(Brown v. Voss).
2. Exclusivity - Non-exclusive easements can only be divided by landowner. RR
easement are exclusive usually (power of eminent domain). May write express
terms allowing holder to expand burden for an extra fee.
iv. Rule of reason when theres ambiguity in the lge, parties foresee reas evolutionary
change both in the use of the dominant estate and in technology). (Cameron v. Barton)
1. Prescriptive use can be expanded both physically and technologically if reasonable
and moderate (Glenn v. Poole).
v. Moved easements cant be moved either by owner of servient or dominant estate.
Minority rule is Lewis v. Young = owner of servient estate may move under certain
conditions.
Termination
a. Deed of release must be written
b. Quitclaim deed to the owner of the servient parcel conveys all interest back to owner
c. Merger when single owner takes title of both dominant and servient parcels, easement disappears
d. Mortgage foreclosure wipes out all claims, including easements, to deliver title clean to new P
e. Condemnation destroys easements by wiping slate clean, but easement holder gets a share of the
valuation award. Two methods of valuation:
c.

3.

13

4.

5.

i. Reduction in value of dominant parcel w/o easement


ii. Increase in value of servient parcel w/o easement
f. Tax sale wipes out all claims, unless dominant owner has paid taxes on her easement, then its
exempt from tax sale
g. Implied by necessity and necessary condition ends
h. Easement for years contains its own termination point
i. Abandonment - if you abandon the use of a permanent easement, the servient owner gets it.
i. Oral abandonment + non-use does NOT show intent to abandon but physical blockage of
easement (putting up barrier) DOES show intent to abandon
ii. Estoppel if servient owner acts in detrimental reliance on abandonment
iii. AP SOL after this has run, ct will say easement has been destroyed by prescription.
Statute of Frauds: To lower the bar of the Statute of Frauds and prove an easement
a. Estoppel reliance theory of part performance if beneficiary of that servitude, in justifiable reliance
on its existence, has so changed position that injustice can only be avoided by recognizing servitude.
b. Evidentiary theory of part performance requires payment, possession, and improvement. (Berg v.
Ting)
Licenses privilege (not right) to use land.
a. Revocable at any time
b. Not transferable
c. No specific location (~floating easements)
d. Can be made orally

Milbrook (717) License or easement? O conveys something to Hunt: a 75 year lease to a small piece of land and the right
to hunt foxes on the rest of the land. O then sells to Smith, who wants a nature preserve. Tiebreaker for the court: lease was
for 75 years, and typically, licenses are not limited to a definite period. Other factors that make an easement:
1. substantial consideration paid
2. usually moored to a lease, appurtenant to the estate.
3. holder is allowed to make improvements/ repairs or to exercise control
Ricebaugh v. Krause License turned easement. Neighbor asks to install pipes to drain land. 50 yrs later ct holds that it is a
perpetual easement or irrevocable easement. By installing/ maintaining pipes in reliance on this license, it was
transformed into an easement. Ct could have also called it estoppel to revoke a license but at some point this would end,
like when the pipes wear out, you cant replace them.
Berg v. Ting (730) Driveway easement over defs land (floating easement). They bought w/o knowing this title co
screwed up and didnt communicate the easement. Ct says the easement violates the Statute of Fraud because theres no
accurate description of where easement goes. A floating easement renders title unmarketable although you can negotiate to
pin it down ex-post.
Evidentiary part performance theory if party who wants to enforce k can show sufficient part performance, bar
of Statute of Fraud goes away and they are allowed to prove that k existed (1. payment 2. possession 3. improvement). In
this case, all these have is payment/ consideration so court says: no easement exists.
Campbell (739) Common owner of motel and restaurant sells them separately. After motel takes title he discovers that his
septic tank is serving the restaurant. Probably reas to restaurants enjoyment. Is it apparent? There was no actual notice,
but could have been constructive notice (although ct decides no). One is on constructive notice if its in the grant or a reas
inspection of premises would yield notice. Apparent at the time of the split or at the time of the intervening BFP?
Otero v. Pacheco (743) Def builds two homes and conveys one away. Sewage begins to back up in new home and they
realize that defs sewage line connects to theirs. Ct finds an implied reservation. There was constructive notice because a
reas inspection wouldve disclosed this fact.
Hurlocker v. Medina (747) By necessity. Original developer divides land, but when split-off happened there was no strict
necessity because of prior road (that was subsequently closed). But necessity was created when 2 lots were, later on, again
under common ownership. Ct says: easement should be granted. The unity of title req does not require the dominant and
servient estates be severed from a previously undivided parcel.
Hester v. Sawyers (755) By prescription. 2 lg tracts of land, one owner commonly used roadway easement. Orig owner
only enclosed 3 sides of property w/ a fence and current owner adds the fourth side in 1922. This forces def to change
direction in road so it goes slightly south of orig easement def uses this new road for 10 yrs.
14

Ct determines that Def has an easement by prescription. The 2nd road was more adverse, the prior road was
permissive. Presumption w/ rural land, unless its fully fenced, presumption is that 3rd party usage is permissive.
Shanks v. Floom (760) Driveway easement. 1924 neighbors split cost to build driveway half on each side of their land.
Permissive or an easement? Ct: presumption is of adverse use. Since it wasnt rebutted, both sides have an easement for
driveway purposes.
Cameron v. Barton (774) Express easement evolving use. Appurtenant easement dominant tenament changed from
slaughterhouse to a highway garage. Goes from horse-drawn carts to trucks. Pl claims that since the terms of the orig
grant are not known, use of the passageway must be restricted to how its previously been used. This is valid if it were an
easement by prescription but this is an easement by deed. Lge says right of passway w/o fixing any limitations so court
interprets easement as one that may be used as necessary for the reas occupation and enjoyment of the dominant estate.
Brown v. Voss (768) No glom-on rule. Neighbor invests 11 k into building a house on 2 properties he purchased before
Neighbor refuses to let him continue to use his easement (that was just for one of the properties). Problem is you cant
glom extra land onto a tenament and use the easement to service the additional track. Ct acknowledges black-letter rule but
still tries to do equity by saying neighbor was estopped from asserting the rule since he waited so long.
Fristoe v. Drapeau (777) Implied easement changing use. Dominant owner wants to build a house, but servient owner
argues that change in use of dominant estate is a surcharge on the easement. Ct must consider actual uses beings made at
time of severance and uses intended when two parties were severed.
Glenn v. Poole (778) Prescriptive easement expands use. Pl objects to widening of roadway-easement where it hits the
highway (apron). Ct says some expansion of use both physically and technologically is permissible and foreseeable.
Pasadena v. CA (782) Non-exclusive easement. 5-ft pipeline easement. Landowner grants two waterworks companies
easement right to same space. Ct said this is not an exclusive easement. Test is that 2 nd easement does not interfere w/
primary grantee.
Lewis v. Young (789) Relocation of easement by landowner. Can a landowner relocate a right of way w/o the easement
holders consent? Yes, in the absence of demonstrated intent otherwise and consonant w/ beneficial use and development
of his prop, so long as he bears the expense of the relocation and so long as the change does not frustrate the parties intent
or object in creating the right of way, does not increase the burden on the easement holder, and does not significantly lessen
the utility of the right of way. In this case, precise location of easement was not spelled out (floating easement that was
located) if it it was spelled out, cts will be more reluctant to permit relocation at request of landowner.
Glosemeyer v. U.S. (803) Rails to trails. Were RR easements extinguished before being turned into trails? Conveying
ones interest in land is clear evid of intent of abandonment, esp when its for a contrary purpose. Ct says hiking/ biking is a
form of transport but too remote to be considered for RR purpose. Railbanking is unlikely. Ct concludes that fed statute
works as a taking.
SALE AND TRANSFER OF LAND
1.

Earnest money contract deposit money paid up front


a. Executory period of 1-3 mo. until theres a closing
i. Title quality - ensure that title is marketable or free from reas doubt = default position
1. Parties can contract though that title be other than marketable
ii. Financing arrange for financing
iii. Investigate property
iv. Title approval title ins. generates preliminary title report which guarantees title in FSA
subject to the following: encumbrances, mtges, easements
b. Buyer sends preliminary title report to Seller to get title defects fixed
i. Title ins may charge an additional premium to get rid of exception for defects
ii. States w/o title ins will get lawyers to examine title abstracts
iii. Other states have real estate lawyers examine title and send their assessment to buyer
iv. Torrens system (rare)
c. Closing
i. Seller will deliver a grant deed to Buyer
ii. Deed must be in writing except for a lease of 1 year or less.
15

1.
2.
2.

3.

4.

5.

Essential elements of deed: parties names, description of land, evidence of intent to


convey, grantors signature and delivery. Same reqs as for an earnest $ contract.
As btw parties, you dont need notarization. To be good in the eyes of the world, deed
must be recorded and signatures notarized.
No consideration required for a deed.

3.
Mortgages
a. Conventional loans
i. Adjustable Rate Mtge loan v. fixed rate loan
b. Insured loans FHA, Dept of Veteran Affairs, GNMA- secondary mkt

Statute of Frauds
a. Contract for sale of land must be in writing
i. Exception: leases for a year or less
ii. Minimum elements ks must contain
1. Parties names
2. ID of land
a. By reference to a U.S. survey or an official subdivision
b. By metes and bounds
3. Signature of party against whom its being enforced cts are lenient here ex. emails ok
b. Part Performance- allows Statute of Frauds bar to come down so that parties can prove their k. Acts of
part perf must have unequivocal reference to the land, although cts do relax this req. The following
theories can be mixed by the ct:
i. Evidentiary theory must have some of the following
1. payment of part or all of the purchase price
2. possession
3. improvements
ii. Estoppel Reliance party who is proposing k has relied to his detriment substantially (Roundy)
Escrow
a. Used in CA law does not require it but its custom.
i. In other parts of the country, realtor/ mtge lender/ title ins. Co. handles this
b. Acts as intermediary, handles closing services
c. If seller dies in the interim, w/ Escrow there is still a valid deal.
Marketability free from reasonable doubt. Implied in all conveyances.
a. Merger at closing, objections to marketability merge with the deed. Post-closing buyers defense is
title ins and warranties.
b. Waiver parties can agree to waive marketability
c. Problems:
i. Break in chain of title
1. There could be a missing deed, one conveyance never got recorded.
2. Adverse possession if so a quiet title action must be brought
3. Bad title forgery somewhere in the chain
ii. Encumbrances Any claim by 3rd party on real estate unless theyre the type that the party has
agreed to ex.encumbrances that dont materially affect value of the prop for use as a residence
1. Mortgages lender can foreclose on land if not paid
2. Easements right to use
3. Judgment liens unsecured claim reduced to a jment that becomes a lien on land
4. Restrictive covenants (CC&Rs) Ability of 3rd parties to limit how owner uses estate.
Current violation of this renders title unmarketable. Otherwise, you dont lose title, but
other party can bring an injunction.
5. Zoning ordinances claim by govt to restrict use of real estate. Mere existence of
these ids not deemed enough to render prop unmarketable until theres a current
violation. Violation of bldg codes doesnt affect marketability.
6. Leases
7. Defeasible fees you can lose title by some use of the land. Renders title unmarketable
8. Unpaid property taxes
iii. Miscellaneous - Encroachment renders title unmarketable
d. Buyers remedies
i. Restitution earnest $ back and compensation for expenditures made in direct reliance on the k.
1. Minority rule: if seller has in good faith breached and cant convey land (bad title) the
only remedy available is restitution.
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6.

7.

8.

ii. Damages (not a good option) earnest $ and loss of bargain. Requires a lot of evid.
iii. Specific Performance (equitable remedy) every piece of property is unique. This option only
works if prop has not already been sold to a BFP.
e. Sellers remedies
i. Earnest $ as liquidated damages if its expressly in lieu of other damages, but it cant be penalty.
ii. Damages (not a good option) because seller has to convince jury he pulled a fast one.
iii. S.P. Contract price.
Mortgages
a. Purchase $ mtge proceeds of mtge are used to buy real estate.
b. Statutory redemption
i. Clogging the Equity of Redemption invalid. When lender reduces interest rate buyer agrees
upfront to waive/ limit right to foreclosure.
ii. Redemption period 40% of states allow a period of post-foreclosure when debtor has right to
pay purchase whatever they paid during foreclosure sale (3-6 months, maybe a year).
c. Promissory note every mtge requires one. This alone is just a plain loan.
d. Acceleration if borrower defaults, lender can force a balloon.
e. Foreclosure
i. Judicial foreclosure
ii. Power of sale foreclosure (non-judicial). Power of sale clause must be in contract.
iii. If this doesnt cover debt, bank will seek a deficiency jment that allows them to go after other
assets borrower is personally liable (not allowed in CA for purchase $ mtges). A right to get a
deficiency jment must be by judicial foreclosure.
iv. Less $ - foreclosure routinely yields less than market value you cant inspect the property.
f. Law of Priorities 1st lender gets priority
i. If junior mtge forecloses, it gives P a title with senior mtge still attached to land. P takes over
mtge and pays them directly.
Warranty
a. Warranty 5-6 covenants that protect buyers
i. Present covenants - cause of action on these is triggered on the day deed is delivered (SOL).
These are only valid with respect to the original grantee.
1. Seisin I own land, no break in title
2. Right to convey almost irrelevant promise, it means if an agent, he has been granted
to power to convey
3. Covenant against encrumbrances tracks marketability encumbrances (3rd party claims
on the land, easements, mtges, liens, leases, CC&Rs)
ii. Future covenants triggered only when there is an eviction (constructive or actual). These run
with the land future owners can sue original grantor on future covenants.
1. Warranty and quiet enjoyment they track 1,2 and 3
2. Further assurances promise by grantor to execute such further doc s as may be
necessary to perfect the grantors title.
iii. Eviction = when paramount title holder
1. Obtains a decree giving him possession (SP, ejectment)
2. Orders grantee off land threatens litigation
3. When grantee buys the paramount title in order to avoid eviction (must be right)
4. When grantee surrenders her claim to paramount title holder and moves off land
5. When grantee is sued by paramount title holder and settles, left w/ only part of ld
iv. Limit on Recovery grantee under a deeds covenants of title cannot get more than
consideration received by the grantor plus interest
v. Estoppel by deed party is estopped from keeping rights that he has already conveyed even if
he receives the rights post-conveyance.
b. Grant deed limited warranty.
i. Only warrants that seller didnt do anything to screw up the title.
ii. Contains only present covenants.
c. Quitclaim deed no warranties, buyer beware.
i. Minority: providing a quitclaim deed is an implied rejection of the implied covenant of
marketability.
Recording Acts required to make deeds valid against 3rd parties.
a. Prior taker always wins if he records before 2nd taker takes.
b. BFP: must pay value and take without notice of prior takers
i. BFP can be purchaser, lesser, easement grantee, mortgagee, option holder, jment lien holder
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9.

ii. Notice =
1. Actual: if you know about the other party (mere rumor is not enough)
2. Constructive: if A recorded before B takes
3. Possession: if A is in possession, B is on constructive notice
a. In minority of states, possession can only be actual notice. In this case, you
may be in possession only part of the year, recording is better
b. Deemed to know about AP: APs cant record. If its open and notorious as
required, itll put parties on notice, but it may be seasonal use which still
satisfies open and notor req. Law says even if AP acquired poss, then goes
abroad for years, its still constructive notice.
c. Easements by prescription: deemed to be on notice
d. Easements by implication : physical apparency at time of split which must be
relevant to 3rd parties
iii. Pay value = flexible standard btw 0 and market value.
1. Suppose its a promissory note? Maybe note. If any $ is paid down, its good.
2. If its a negotiable note (w/ no $ down) its paying value. If its non-negotiable, no.
c. When does a subsequent taker of a conveyance prevail against a prior unrecorded conveyance?
i. Race for the registry states (LA French civil code)
ii. Notice-race states: subsequent taker must always be a BFP and record before another taker.
This does not protect donees.
iii. Pure notice protects subsequent purchasers, allowing them to rely on the record title as it
exists at the time of their purchase.
d. Mechanics liens: anyone who supplies material/ labor incorporated into real estate can recover money
they are owed if the owner/ builder doesnt pay them. They can file liens on prop usually have about 1
year to foreclose or lose their lien. Claimaint is given some time after completion of work to file the
claim in the public records. Once filed, it relates back to date the work commenced. One who purchases
btw those two dates cant be certain of taking free of such liens.
i. 50% of states: homeowners payment to gen contractor is payment to the subs, so subs dont
have a claim against the owner. Other 1/2 of states hold that subs can claim payment from
owner if general contractor doesnt pay them. Buyer needs to make sure title ins. does not
except out liens that dont appear on record.
e. Mortgages
i. First mortgagor can lose priority if a second mortgagor is a BFP and records prior to him.
ii. Antecedent debt unless E2 gives present value for the mtge, he doesnt pay value under the
Recording Act except if mortgagee gave MR an extension in years to pay.
1. Same goes for judgment liens unless a BFP purchaser then buys the jment lien at an
execution sale (paying present value). But if JL records before this pt, it doesnt
benefit from the Recording Act.
Certificate of Title
a. Torrens - dying out because of long delay to get title.
i. Indu landowners must bring their land under Torrens system by bringing a registration action.
ii. Torrens certificate of title is meaningful if you lose it, you pay ~$500 to replace.
iii. To buy Torrens prop, buyer must have deed from owner and certificate of title.
iv. Immune to AP.
b. Title insurance can be for owner or lender
i. Wont insure against defects owner makes himself (ex. Lien)
ii. Typically mtgees policy is paid for by lender, insuring their lien priority.
iii. Covered risks: 3rd parties own interest in your title, forgeries, unrecorded leases, easements,
construction liens, deductible if boundary-line encroachment, pay atty fees if youre sued or
theyll cure defect themselves, etc.

Roundy v. Waner Estoppel reliance. Parents w/ bad credit convey by deed a house to daughter and son-in-law who then
own legal title. Real owners/ equitable title still belongs to parents. Personal falling out and parents ask ct to remove
daughters name off title. They counter-claim that they have real title there was an oral k to deliver to them real title if
they promised to pay off mtge and make improvements. Ct finds estoppel reliance: they sold their house to move closer to
parents in reliance on the oral agreement to transfer full title to them.
Burns v. McCormick Unequivocal reference. Pls cut a deal w/ an old man to take care of him in exchange for inheriting his
house. They sold their house, moved 200 mi away. He died soon after and oral k was contested. Ct said that shouldnt get
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house because it violates the statute of frauds and there are not sufficient acts of part performance evidentiary theory
used. Selling their own house and moving 200 mi does not unequivocally refer to the sale of land.
Laba v. Carey (878) Sometimes ks say buyer agrees to take an insurable title (lesser std) not marketable one. Sometimes
an earnest $ k will say that at closing, conveyor will give a quitclaim deed, not a warranty deed, but this does not negate the
promise of marketable title. Problem: sidewalks in neighborhood violate a restrictive covenant by city. But city said to
seller when he built the sidewalk in front of his prop, that they would waive objections. Buyers remorse even though
title ins. Co agrees to insure that theres no present violation of restrictive covenant. Seller sues for SP and wins.
Chase Federal v. Schreiber (931) Elderly woman flattered by young man and grants her estate to him in consideration of
love and affection. After she dies, executor sues to get land back. Ct holds that you can have a deed w/o consideration.
Brown v. Lober (995) Def conveys by warranty deed land w/ mineral rights to pl. Pl then sells minerals to coal co. who
examines title and discovers they only own 1/3 interest in coal. Brown brings cause of action against def for violation of
the covenant of seisin but he cant recover because SOL has run.
RESTRICTIVE COVENANTS
I.

II.

III.

IV.
V.
VI.

Regulated in three ways


a. Law of nuisance O cant use land to unreasonably interfere w/ neighbors use of land
b. Law of Zoning by local govts
c. Law of Restrictive Covenants
Developer of subdivisions
a. Records CC&Rs before any lot is conveyed out. Anyone in subdivision is then on constructive notice.
b. Continuing Owners Assc can levy fees to support themselves. If O doesnt pay, its a lien on their prop.
c. Common plan physical configuration of subdivision puts people on constructive notice of restrictions
on other deeds. Test is apparency.
Condominium vertical subdivision
a. Before units are sold, they record by-laws:
i. Right to levy assessment for capital improvements or maintenance
ii. Right to levy fees for Owners Assc.
Informal restrictions
a. Two neighbors execute bilateral agreement. Cts only require notice of this in subseq owners in order to
be bound by restrictions.
Use v. Building restrictions
a. If language is ambiguous, cts look to con law (no racial restrictions), state statutes or local ordinances,
federal statutes or public policy
Termination
a. Expiration date (usually 20-25 years)
b. Generally default rule is that you need unanimity for renewal for CC&Rs or amendments.
c. Cts may impose a uniformity req cant benefit some owners over others.
d. Changed circumstances (are changes so substantial that they have changed the residential character of the
neighborhood) v. Abandonment (easier to show that just one indu covenant has been destroyed)
e. Eminent domain
f. With a tax foreclosure, covenants remain.
g. Inadvertently when 2 properties come under common ownership cant have covenant on your own ld.

Groninger (683) Developer of subdivision sells model home at the end. Until then, its used as a meeting point.
Restrictions in deed are ambiguous: structure is to be used for residential purposes. Is this a building restriction or a
use restriction? Only single-family homes can be built or Bldgs can only be used for single-family purposes. Ct.
says its a building restriction, so no restriction on use for business purposes.
Metzner (684) Use restricted for residential purposes only. Neighbors sue for daycare being run next door. Ct said this
violates covenant.
Dufrane (700) Def violated restrictions by building a detached garage. Neighbor put def on notice from day 1. Ct may bar
particular pl w/o invalidating restriction for which pl seeks relief
1) unclean hands one who seeks equitable relief must come into court w/o having violated
2) Wavier or acquiescence if you allow your neighbor to consistently violate a covenant
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3) Laches (equitable SOL) unreasonable delay in notifying


4) Estoppel if pl has done something to affirmatively mislead def.
Although neighbors had built sheds in yard as well, ct said this did not destroy resid character of neighb.

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