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Property Fall Semester OutlineI. Definition of PropertyII.
PossessionA. ElementsB. Abandoned PropertyC. BailmentsIII. GiftsA.
Elements B. Inter vivosC. Gifts Causa Mortis IV. Adverse Possession
V. Freehold Estates VI. Concurrent InterestsA. Tenancy in CommonB.
Joint Tenancy C. Tenancy by the Entirety VII. Non-Freehold
EstatesA. Landlord/Tenant Relationships
I. DEFINITIONSI. Property A. Property is neither an intangible
nor a tangible thing but rather a conceptB. Rights with MARKET
VALUE (legal market)1. Possible to separate rights and add
conditions or limit useC. Rights in intangibles can constitute
propertyD. Not all physical things give rise to rights ex.
Endangered species that cannot be captured, bought, or soldE. Legal
rights do not necessarily constitute property ex. Right to vote is
not marketable and therefore not property II. OwnershipA. Property
in a particular partyB. Harder to prove ownership than possessionC.
Requires appropriate documentation
III. Property Causes of Action Action of, for, or in Replevin:
request for return of a thing unlawfully held in addition to money
damages for injury, if any, to the thing Action of Trover: request
for money damages to the equal value of a thing detained and not
returned; owner loses the right to possess and own the property
Action of Trespass to Chattels: an action for trespass is a request
for relief from interference with possession and money damages for
any injury to the thing detained, as well as damages for the lost
value of its use Action for conversion: request for money damages
equal to the value of a thing unlawfully detained and not returned
or alternatively a court order ordering the party possession to
return the thing.
II. POSSESSIONI. Elements of PossessionA. (1) Physical control
over property and (2) intent to control and exclude othersB.
Control: must be able to(1) Utilize the property (2) Given notice
of the claim (use is notice) (3) Exclude others from using it (also
implies notice)II. Abandoned Property A. Abandonment: words or
conduct manifesting in intent to permanently relinquish ownership
or possession ex. Extensive non-useB. Near non-use does NOT mean
abandonmentEads v. BrazeltonAbandoned property may be claimed by
acts of possession. Discovery in and of itself is not enough to
constitute possession rather, active (and timely?) attempts to
recover the possession is required. III. BailmentsA. Bailment is
the relationship between the owner of a chattel and one who
possesses it lawfullyB. A bailee has an obligation to care for the
chattel as would a reasonable person under the circumstances.C.
Exculpatory Clauses1) Notices exempting the bailee of liability.
These are often not enforceable unless the bailee makes it explicit
and can prove the bailor was aware. This is to stop bailees from
exempting themselves from the responsibility which bailment
entails.D. Prima facie case: 1) In all actions by a bailor against
bailee for loss or damage to personal property, P must show that
the property was delivered to D in good condition and that it was
not returned or redelivered according to contract. Allen v. Hyatt
Regency2) D was negligent and the burden of proof shifts to the
defendant to disprove the assumed negligence.III. GIFTSI. Law of
donative transfers requires1. Intent 2. Delivery3. Acceptance
One who claims ownership by voluntary transfer must show that
the transferor manifested intent to transfer the claimed interest
and that the formalities of delivery and acceptance have been
observed.In Re Cohn 213There are circumstances which allow for the
foregoing of the delivery element so long as the question of intent
may be reasonably satisfied II. Support for the Delivery
Requirement Donors should be protected against spur of the moment
inclinations to donate Delivery may bar some false claims It is a
safeguard against jurors making mistakes when deciding intent A
promise to donate or intention to transfer in the future is legally
ineffective. A transfer of ownership cannot be given effect unless
at the moment it occurs it is sustained by the owners manifested
intent
III. Inter Vivos Gifts 213 Gifts made during the life time of
the giver require intent, delivery and acceptance A reserved life
estate lets you transfer possession but you reserve the right to
use that property during your lifetime A business entity can make
and receive inter vivos gifts Gruen v. Gruen 217Inter vivos gifts
can be made with reserved life estate terms, and in those cases
literal and immediate delivery of the property is unnecessary as it
defeats the purpose CONDITIONAL GIFTSOne that is subject to or
dependent on a condition. A conditional gift can be revoked if the
recipient does not fulfill the conditions attached to the gift. A
gift is a conditional gift and it is not final until some future
event occurs. If the particular event does not occur, the person
making the gift has the right to get back the gift. Lindh v. Surman
219 (an exception; not a standard inter vivos gift)Precedent
dictates that marriage is the accepted condition which would vest
title to the donee. The court is reluctant to delve into the issues
of fault because it opens doors where the court declines to
adjudicate.
IV. Gifts Causa Mortis 1. Must be made in view of the donors
impending death2. The owner must die of the CONTEMPLATED disorder
or peril*The gift is conditional upon death 3. There must be
delivery of the thing given *Delivery must be such as is actual,
unequivocal and complete during the lifetime of the donor, wholly
divesting him of the possession, dominion, and control thereof
*Except when no actual delivery can be made or the situation is
incompatible with the performance of such a ceremony4. Donor must
be competent to make a the gift5. Intent upon the donors part to
make the gift6. Acceptance by the donee Policy: Why is delivery a
key element? To eliminate delivery would permit any writing to
effectuate a testamentary transfer, even though it does not comply
with the requirements of the statute of wills Foster v. Reiss
222Without delivery (and in addition the incapacity of one party)
invalidates the gift. Scherer v. Hyland 230 In the case of gifts
causa mortis suicide and failure to deliver does not invalidate a
transfer if the decedents intent is unquestioned and she, to the
best of her ability given the context, effectuated that intent.
IV. UNAUTHORIZED POSSESSIONAnderson v. Goldberg Facts: Anderson
was liable for the logs he took even though they were not obtained
rightfully in the first placeHolding: The only way to challenge
someone elses possession (even if illegally obtained) is to show
that you have a better claim or superior title to the property
I. Adverse Possession of Real Property A. A person who
trespasses on another individuals property can acquire ownership to
said propertyB. Theories:1) Labor: Those who possess and
productively use property should be rewarded with ownership2)
Negligence: True owners negligence or inaction in protecting his
real property from trespass 3) Practical way to resolve ownership
disputes
II. ELEMENTS (AVHECS)(1) Actual(2) Visible(3) Hostile(4)
Exclusive(5) Continuous(6) Statutory 1) Actual: Physical control
over the property; enough control that is would constitute
possession. Exception to actuality: color of title2) Visible: Such
possession as would put a reasonable community member on notice of
the adverse claim OR Possession that is actually known by the title
holder (even if not obviously visible) 3) Hostile: In every
jurisdiction: the possession is without the permission of the title
holderMajority View: all that need be true is possession without
permission Minority Views: 1) Claimant must both be there
non-permissibly and also have an innocent state of mind (acting in
good faith; law should not reward intentional wrongdoer)2) Claimant
must both be there non-permissibly and also have a guilty state of
mind (intent to make claim on anothers property or its not actually
hostile) 4) Exclusive: Possession is not shared with the title
holder or others except permissibly by the claimant 5) Continuous:
Possession and use that is ordinary given the nature of the
property6) Statutory Period:a) Possession beyond statute of
limitations (vary by jurisdiction 5-25 yrs. avg.) b) When elements
1-5 are simultaneously true the clock starts running;c) Statute of
limitations for replevin SL will commence at the time the injured
party knew, or should have known, of a COA UNLESS the injured party
in question fails to exercise reasonable and due diligence in
discovering facts which form the basis for the cause of action.
Marengo Cave Co. v. Ross 168Adverse possession requires that the
owner knew, or should have known, of anothers possession, which
arguably gives the owner an opportunity to do something about it
prior to running of the statutory period.Cave co. argued adverse
possession- the court held it was not visible and therefore not
valid. III. Severance: Can someone claiming adverse possession of
surface land also laid claim to underground materials? Depends-
have the materials been separated already? IV. Mistaken Improvement
of Land: An equity court can order relief deemed fairV.
Prescription: Persons can acquire less than full fee simple
ownership when they use anothers property land with a more limited
use commensurate with easements. Ex. To create a path/roadwayVI.
Tacking (only in privity) 1) An adverse claimants right to add
successive periods of adverse possession together where each set of
two successive possessors is in privity2) Privity: an adequate
legal relationship
Howard v. Kunto pg. 178 Tacking of possession by subsequent
occupants is permitted AND continuous use can be satisfied by
summer possession given that this was the intended use of the
property
V. FREEHOLD ESTATES Freehold Estate1. A possessory interest in
land 2. Of indeterminate/indefinite duration (interest will cease
to exist at some future point, ex. life estate)3. Six Estate
Types1. Fee Simple Absolute FSA2. Life Estate LE3. Fee Tail FT 4.
Fee Simple Determinable FSD5. Fee Simple Subject to Condition and
Subsequent Right to ReentryFSSCS6. Fee Simple Subject to Executory
Limitation FSSEL 4. A person and their probate estate are the same
entity in this area. You must be alive to have an any legally
recognized interest. I. Fee Simple Absolute 254A. A freehold estate
which is unlimited as to duration, disposition and descendability;
the most complete set of legal rights that can be owed in real
property. B. Not defeasible on the occurrence of a condition C.
Creating language: 1. GR to A and his heirs or (although the heirs
have no interest at that time)2. GR to A in a fee simple absolute,
or3. GR (owner of FSA) all my right, title, and interest to A or4.
GR to A (by statute)Cole v. Steinlauf 255 A provision allowed for P
to back out of a land sale and recover payments if D could not
offer the fee simple absolute free and clear. To create an estate
of inheritance it is necessary to use heirs but this title did not.
P was justified in backing out to avoid future trouble with a
questionable title. A sold to B who old to C who sold to the
Defendant who is trying to sell to the Plaintiff; the deed between
A and B is suspect Executory period is directly before closing and
during this time people do inspections, title searches etc.
HEIRS: those who take the under the relevant statutes of
descent; devisees if land is being transmitted, or legatees if
personal property is involved. Requiring Heir is outdated. If A
owns a FSA and gives property to X, it is assumed he is
transferring an FSA unless he explicitly states otherwise
II. Life Estate and Remainder or Reversion 267A. A freehold
estate limited in duration to the life or lives of one or more
human beings B. Future interest in a grantee associated with a LE
is called a remainder; the remainder becomes possessory at the
death of the last person surviving among all persons designated as
measuring livesC. Future interest in the grantor associated with
the life estate is called a reversion D. Creating Language 1. GR to
A for life, then to B and his heirs (A holds LE and B holds
remainder in FSA)2. GR to A for the life of C, and then to B and
his heirs (A holds a life estate pur autre vie (for the life of
another) for the life of C, and B holds a remainder in FSA) 3. GR
to A and B for the lives, then to the grantor (A and B hold a life
estate, and the grantor holds a reversion rather than a
remainder)4. GR to A for life, then to B for life, then to myself
(A holds a life estate; B holds a remainder in life estate, and the
grantor holds a reversion rather than a remainder) Lewis v Searles
268 P inherited property but upon her marriage was to take 1/3
possession and give the other 2/3 to other family members. P dies.
Did she have a fee simple title or merely a life estate? Court held
that All devisees are in fee simple if 1. No intent is expressed to
create a life estate only AND2. No further devise is made to take
effect after the death of the devisee Moore v. Phillips pg. 276
(P), the remaindermen, is suing for damages done to the property
during the course of a life estate held by her estranged mother (D)
Duties of a life tenant to remaindermen 1. A life tenant is
considered in law to be a trustee or quasi trustee and occupies a
fiduciary relation to the remaindermen. He cannot injure or dispose
of the property to the injury of the rights of the remaindermen,
but he may use the property for his exclusive benefit and take all
the income and profits2. It is the duty of a life tenant to keep
the property subject to the life estate in repair so as to preserve
the property and to prevent decay or waste3. Waste implies neglect
or misconduct resulting in material damages or loss of property but
does not include depreciation of property due to age and normal use
4. Waste may be voluntary or permissivea. Voluntary: deliberate or
voluntary destructive actb. Permissive: failure of the tenant to
exercise the ordinary care of a prudent man for preservation and
protection of the estate5. Owner of a remainder has a number of
remedies available to him against a life tenant during their life
and aftera. Compensatory damages for injury sustainedb. Injunctive
relief in equityc. Receivership6. When COA is permissive waste
statute of limitations does not commence to run in favor of the
expiration of tenancy. In some statutes the period commences at the
time the waste is committed. 7. An action for waste may be lost by
latches or assertion of estoppel; a. Latches are a lack of action
but estoppel may be an affirmative act on the part of either party.
b. Latches is not mere delay but a delay which works to
disadvantage one party Waste: someone who lawfully has possession
of real estate destroys it, misuses it, alters it, or neglects it
in so that the interest of the persons having a subsequent right to
possession is prejudiced in some way or there is a diminution in
the value of the land being wasted. Oldfield v. Stoeco Homes, Inc.
281Facts: Ocean city sells Stoeco property under several conditions
one of which was that Stoeco needed to fill/grade the land within a
year. Stoeco was having difficulties and the city continually
extended the time frame. Issues: Whether the deed created an estate
in fee simple subject to a condition subsequent or an estate
subject to a limitation (a fee simple determinable)
III. The Fee Tail and Remainder or ReversionA. A freehold estate
by virtue of which a person owns land on behalf of himself and his
lineage. Upon death of the possessor, the estate will pass to the
closest lineal heir indefinitely. B. A party holding a fee tail
estate can convey to another only a life estate limited to the life
of the grantorC. Termination of an FTE occurs with the termination
of the lineageD. Creating language 1. GR to A and the heirs of his
body, then to myself2. GR to A and his issue, then to B and his
heirs3. GR to A and his descendants and then to the grantor and his
heirs4. GR to A and her lineal descendants, then to X IV. The Fee
Simple Determinable and the Possibility (automatic) of ReverterA. A
fee simple which1. Subject to automatic termination upon the
occurrence of a specified condition2. Followed by a future interest
in the grantor (possibility of reverter) 3. Possession reverts if
condition occurs by operation of law (automatic)B. Creating
Language1. GR to X so long as, while, during, until B, then to GR
and heirs, myself and heirs, to GR in fee simple, (GR holds a
possibility of reverter) Roberts v. Rhodes 289 Facts: In 1902 a
quitclaim deed was made of land to the Montgomery County school
district. The deed stated that the grant was made for school or
cemetery purposes only. A second deed in 1908 was made to the
Montgomery County school district and stated that the land so
granted was to be used for school AND cemetery purposes only. Both
deeds were grantsto their heirs and assigns. 1971 the school
district sold the lands to Defendant, the lands had been used for
school purposes. P was an heir of the original grantors and claimed
a reversion interest in the land no longer being used for school
purposes. The lower court found for P. The intermediate appellate
court reversed the lower court and found that the deeds in 1902 and
1908 deeded a fee simple title to the school district not a fee
simple determinable. P appealed.Issue: Does the language in the
quitclaim deeds regarding the description of the purpose for which
the land was to be used create a limitation on the title to the
school district such that the heirs and assigns of the original
grantors have a reversion interest in the lands when they are no
longer used for school purposes?Holding: No, the difficulty in the
case arose from the failure of the original deeds to provide any
guidance as to what the parties intended to happen when the lands
were no longer used for school purposes. The Court noted that the
claim of P was based on a theory that the language of the original
deeds created a fee simple determinable, and that thegeneralrule
for creation of a fee simple determinable is that there must be
language which provides that a fee simple estate is created which
automatically expires on the occurrence of a stated event. In this
case there was no such language in the deeds.Rule:the mere
statement of the purposes of a conveyance will not limit the extent
of the grant. Thus, the declaration in the deeds that the lands
were to be used for school and/or cemetery purposes only, was not
sufficient to limit the estate granted to the school district. The
school district took a fee simple estate in the lands.
Leeco Gas & Oil Company v. County of Nueces 297In 1960 Leeco
gift deeded property to Nueces County with reversionary interest so
long as the property remained a park. In 1983, when the property
was worth between $3 million and $5 million, the County condemned
the reversionary interest, thinking that they might want to use the
land for something else in the future, and gave Leeco $10,000. A
trial court awarded Leeco $10 in nominal damages because the mere
possibility of reverter has no ascertainable value because the fee
simple defeasible is not probable to end within a relatively short
period of time. Because the County knew of the reversionary
interest when it accepted the deed, is the County estopped from
condemning the reversionary interest?HeldNo, a government when
exercising governmental powers is not subject to estoppel. If a
governmental entity is a grantee of a reversionary interest and
that same entity condemns the reversionary interest, must it pay
the difference in value of the restricted and unrestricted
fees?HeldYes; to hold otherwise would discourage gifts of real
property to charities and governmental entities. Here reverter was
not just some speculative event in the future, as the County was
tossing around plans to give other uses to the land and wanted to
be unencumbered with the possibility of reversion. Holding
otherwise would allow government to get around obligations by
preemptively condemning reversionary interests, which would
discourage such gifts.ConcurThat's a good holding, but it would be
better in the future if a political devision that has accepted a
gift by grant of fee simple determinable interest begins
condemnation proceedings, that act would count as a renunciation of
the gift and cause the granted estate to terminate and revert back
to the grantor in fee simple absolute.
V. Fee Simple Subject to Condition Subsequent and Right of
Reentry (discretionary)A. A fee simple (no limit to inheritability)
1. Subject to termination upon the occurrence of a specified
condition at the discretion of the grantor and2. Followed by a
future interest in the grantor 3. Termination is not automatic by
operation of law; GR must take the initiative to reclaim property.
That initiative depends on the state, a claim in civil court, a
notice of GRs intent, 4. Future interest of the GR is right of
re-entry and power or termination5. Not automatic; GR must assert
right of re-entry; courts differ on how to do this (civil suit,
quiet title action, mere notice of GRs intentions) B. Creating
Language 1. GR to A upon the condition that if A should X, then to
the GR2. GR to A and her heirs but if A should X, then GR man
re-enter.3. GR to A and her heirs, provided that A when A does X,
GR may exercise his power of termination
Johnson v. City of Wheat Ridge 294Facts: In two separate
conveyances Johnson conveyed land Wheat Ridge, subject to the
condition subsequent that the land was to be used for a public park
named for the grantor and that the fourteen acre grant was subject
to the condition that public water supply and lavatories be placed
on the premises within two years of the grant.Issue: Is the
language of the deed such that reversion upon the condition is
automatic? Has the statute of limitations run out?Holding: The
specific language of the deed in question stated that the failure
of the compliance with the conditions set out (public water supply
and lavatories within two years) in the deed shall constitute a
condition subsequent terminating the estate of the Grantee and its
assigns and the Grantor, his heirs and assigns may re-enter and
take possession of said premises. This language is an attempt to
create an automatic right of re-entry in favor of P, as an heir of
the grantor.However, The Court held that the breach of a condition
subsequent does not cause title to revert automatically to the
grantor or his heirs and that the use of a lawsuit to enforce the
provisions of the deed is subject to the statute of limitations,
which had since run out.
VI. The Fee Simple Subject to Executory Limitation and Executory
InterestA. A fee simple which1. Subject to termination upon the
occurrence of a specified condition AND2. followed by a future
interest in a grantee automatically (executory interest) B.
Creating Language1. GR to A so long as condition B is met, then to
C 2. GR to A, but if A should do condition B, then to C and his
heirs Future Interest1. Reversions2. Possibilities of Reverter3.
Rights of Re-entry Kost v. Foster (1950) pg. 313Facts: John and
Catherine Kost conveyed in a warranty deed their land to their son
Ross Kost to use as a life estate, with remainder to his lawful
childrenof which at the time he had five. Before he died, he had
seven lawful children, and one of them, Oscar Durant Kost, was
bankrupt and his portion went to Marshall C. Foster. The children
sued Foster, saying that Oscar's remainder was not yet vested, as
Ross was still alive, and therefore couldn't be transferred by
bankruptcy.Held:Oscar's portion was vested in qualityhe would not
have lost it by dying, although not in quantitymore children could
have been born that would have reduced his interest. Contingent
interests are created by specific language in the deed that create
a condition precedent (e.g. "only to those children who survive
him"). Otherwise, any conditions are conditions subsequent that
make the vested remainder subject to divestment (e.g. "to his
children, but if any die while he is alive the share goes to the
rest of the children"). (Of course, all remainders are uncertain as
to enjoyment, as the recipient of a vested or unvested remainder
may die before the life estate is terminated.)
Abo Petroleum Co. v. Amstutz 319Facts: In 1908 by separate
instruments which were called conditional deeds James and Amanda
Turknett (grandparents of Defendants) conveyed life estates in two
separate parcels to Ruby and Beulah (parents of the Defendants).
The deeds called for the property to remain the daughters during
her natural life, . . . and at her death to revert, vest in, and
become the property absolute of her heir or heirs, meaning her
children if she have any at her death, but if she die without
heirs, then and in that event this said property and real estate
shall vest in her estate. At the time neither daughter was married
and neither daughter had any children. In 1911, the parents gave
another deed to Beulah which purported to give absolute title to
the grantee. Also, there were subsequent deeds on the same parcels
to Beulah in 1916 and to Ruby as a correction deed. After the deeds
had been made Beulah had three children and Ruby had four children.
Beulah and Ruby attempted to convey fee simple interests in the
property to predecessors of Plaintiff Abo Petroleum Company. The
children of Beulah and Ruby argue that the their parents could only
convey life estates in the property to the predecessors of
Plaintiff Abo Petroleum Company. The Plaintiff contends that the
deeds in 1911 and 1916 vested Beulah and Ruby with fee simple title
which was then conveyed to Plaintiffs predecessors. The lower court
found in favor of Abo Petroleum Company and the children
appealed.Issues: Could the original grantees Beulah and Ruby have
received any interest in the deeds which came after the creation of
the life estate, such that the contingent remainders of the life
estate are destroyed?Holding: No, judgment reversed. The Court held
that the position of Abo Petroleum is that the subsequent
conveyances to Beulah and Ruby caused the original grantors
reversionary interest to merge with the life estates of the
daughters and that the contingent remainders to the grandchildren
were thus destroyed and the daughters took fee simple possession of
the property which they later conveyed to Abos predecessors. This
is an example of the doctrine of destruction of contingent
remainders.The Court held that the doctrine of destructibility of
contingent remainders has been almost universally rejected by
modern authorities. The Court declines to applythe doctrine and
finds that the subsequent deeds to Beulah and Ruby have no force
and effect.
The daughters acquired no further interest in the property under
the later deeds than what they had already, which was a life
estate. Thus, their conveyance to Abo Petroleums predecessors could
only be that of a life estate, even if it purported to be a fee
simple.
Shelley v. Kramer 1948 pg. 91Facts: On February 16, 1911, thirty
out of thirty-nine property owners in a neighborhood in St. Louis,
Missouri entered into a restrictive covenant which stated that for
a term of fifty years no property in the neighborhood could be sold
or rented to any black or Asian persons. On August 11, 1945,
Petitioners Shelley, who were black, bought a property in the
neighborhood from Fitzgerald, and Petitioners were not aware of the
restrictive covenant at the time of the purchase. Respondents, who
were the other owners in the neighborhood, sued in the Circuit
Court of St. Louis on the basis of the restrictive covenant with
the intention of having the Court divest the Petitioners of their
newly acquired property and revert title to Fitzgerald, or to some
other person at the Courts discretion. The Circuit Court declined
to enforce the agreement on the basis that not all of the property
owners had signed the original covenant. The case was then appealed
to the Missouri Supreme Court which reversed the Circuit Courts
decision and held that the provisions of the covenant were
enforceable against Petitioner. Petitioners then appealed to the
U.S. Supreme Court.Issue: Does the action of the state court in
enforcing the restrictive covenant deprive Petitioner of rights
guaranteed by the Fourteenth Amendment and acts of
Congress?Holding/Reasoning: Yes. The judgment of the Supreme Court
of Missouri is reversed.First, the Court noted prior decisions and
found that the restrictive agreements, standing alone, could not be
regarded as a violation of any Fourteenth Amendment rights. The
Court found that the requirement for state action was not met in a
purely private and voluntary covenant. However, the Court found
that in this case there was state action by virtue of the Supreme
Court of Missouris decision to enforce the restrictive covenant.
The Court found that state action includes actions by legislative
bodies and also courts and judicial officials.The Court held that
in granting judicial sanction to an agreement which, by its terms,
would deprive the Petitioners of equal protections guaranteed by
the Fourteenth Amendment is an action which cannot stand.
Therefore, the Court held that the Supreme Court of Missouri had to
be reversed.Because the Court decided the case on the question of
equal protection it was unnecessary to consider the Petitioners
arguments regarding due process and whether the Petitioners had
been denied privileges and immunities accorded to citizens of the
United States.
Capitol Federal Savings & Loan Association v. Smith
350Facts: The Plaintiffs, black people, assert ownership in this
quiet title action of property which is purported to be under a
racially restrictive covenant, Plaintiffs were seeking to have the
cloud on title removed. The Defendants are property owners in the
neighborhood who claim the Plaintiffs property based on the
forfeiture provisions in the racially restrictive covenant which
provide that forfeiture will be made upon placement of a notice of
claim, which Defendants did. The trial court found for the
Plaintiffs and stated that to enforce this agreement would have
been a per se violation of the Fourteenth Amendment.Issue: Does the
private racially restrictive covenantapply such that the Plaintiffs
property is subject to forfeit under the covenants
provisions?Held/Reasoning: No. The judgment is affirmed.The
Defendants claimed that Shelley v. Kraemer, infra, was not
controlling due to the fact that the court was not considering
provisions relating to forfeiture or future interests in the land,
which Defendants claimed were created by the terms of the racially
restrictive covenant.The Court found that regardless of how the
Defendants sought to characterize the effects or operation of the
covenant, the attempt was to deprive the Plaintiffs of a right
protected by the U.S. Constitution.The racially restrictive
covenant is a nullity under Shelley v. Kraemer, infra, and its
progeny, and noclaim can ever be supported by law which would
violate the protections of the Fourteenth Amendment.Notes: This
case is only tangentially related to future interests. As this
Court noted, the case was probably brought to provide some rules
for title abstractors to follow when faced with a racially
restrictive covenant.
City of Klamath Falls v. Bell 356Facts: In 1925 a corporation
gift deeded land to the City of Klamath Falls as long as the city
used the land for a library, and thereafter unto Fred Schallock and
Floyd Daggett, their heirs and assigns. The city closed the library
in 1969 when the books were moved to another library. Thereafter,
the city sued to quiet title in fee as to the land. The Defendants
were all of the heirs of Schallock and Daggett. The grantor
corporation, had been dissolved and the assets (including any
interest in the property) were transferred to Fred Schallock and
Floyd Daggett. Thereafter, all of the remaining heirs transferred
their interest, if any, in the property to Defendant Marijane
Flitcraft. The trial court found for the city based on its finding
that the gift over to Fred Schallock and Floyd Daggett was void
under the rule against perpetuities. The city argues that the
interest was never passed to the heirs, heris argued that title
automatically vested in S & Ds probate estate, and then the
possibility of reverter had been passed down. Heirs prevail.
Corporation to the City, so long as used for library purposes,
then to S & D.
Corporation attempted to create a fee simple subject to executor
limitation and a shifting executory interest in S & D. (not an
FSD or FSSCS b/c GR does no hold executory interest) Actually the
interest is void under the rule against perpetuities; the city
could maintain a library indefinitely (the interest may not vest or
terminate within the life plus 21 yrs. of the city) Void the
executory interest; Corporation to the city, so long as used for
library purposes Now a FSD with GR (Corp.) holds the possibility of
reverter, heris of GR hold POR.
PERPETUITIES REFORM:Some states abolish rule entirelyOthers
substitute a 90 yr. rule USRAP (Mass. for example)Wait and See Rule
wait through a lifetime and 21 yearsCy Pres future interests are
reformed so that they do not violate the rule
Present Possessory Estates
Present EstateExamplesDurationFuture Interest in GrantorFuture
Interest in 3P
Fee Simple Absolute
To A & his heirsForeverNoneNone
Fee Simple DeterminableTo A & his heirs so long
as...until...while...As long as condition is met, then
automatically to grantorPORNone
Fee Simple Subject to Condition SubsequentTo A & his heirs,
but if...upon condition that...provided that...however...Until
happening of named event and re-entry by grantorNot
automaticRORNone
Fee Simple Subject to an Executory LimitationTo A & his
heirs, for so long as..., and if not..., to B.
To A & his heirs, but if..., to B. As long as condition is
met, then to 3P.
Until happening of event.None Executory Interest
Springing OR Shifting
Fee TailTo A & the heirs of his bodyUntil A and his line die
outReversion (remainder is possible)
Life Estate (may be defeasible)To A for life, orTo A for the
life of B
To A for life, then to B
Until end of measuring life Reversion
Remainder
1. Doctrine of Destructibility of Contingent Remainders:
Contingent remainder is destroyed if it does not vest at or before
the termination of the preceding life estate.0. Abolished in almost
all states, and lawyers can easily avoid the rule by careful
drafting0. Ex: O conveys to A for life, then to the heirs of B. A
has life estate. Bs heirs have a contingent remainder in FSA, since
unascertained. O has a reversion in FSA. If A dies and B is alive
(dn have heirs yet), then Bs heirs are divested.0. In jurisdictions
w/o this rule, if A dies and B is alive, O gets possession in FSSEL
and Bs heirs have an executory interest and will divest O when
ascertained.
1. Rule in Shelleys Case: 1. Banned practice of making life
estate in A, remainder to As heirs (merge remainder in ancestors)1.
GR to A for life, then As heirs (A: FSA)
1. Doctrine of Worthier Title: a) Intervivos conveyance of any
contingent remainder or executory interest to GRs heirs is voidb)
GR gets reversion c) GR to A for life, then to GR heirs A: Life
estate GR: Reversion
1. Rule Against Perpetuities3. No interest is good unless it
must vest, if at all, not later than 21 yrs. after some life in
being at creation of interest. 3. GR to A, if A discovers cure for
common cold. (A has a springing executory interest which is void)3.
GR to A if any of As children discover cure for common cold. (A has
no living children; GR not adequate measuring life, A not adequate
measuring life either)3. Applies to contingent remainders &
executory interests 3. Does not apply to vested interests
(remainders or future interests of transferor)3. An executory
interest following a fee simple determinable or divesting a fee
simple vests only when the condition happens and it becomes a
possessory estate. 3. Measuring life: Life in being at time of
creation of interest, alive or conceived.3. Strikes down contingent
interests that might vest too remotely. You must prove that a
contingent interest is certain to vest or terminate no later than
21 years after the death of some person alive 5. Definition of
vest:0. Contingent remainder must become possessory or become a
vested remainder.0. Executory interest must become possessory3.
Reforms to RAP:6. Wait-and-See Doctrine: > states have reformed
RAP to judge based on actual events; some wait out the relevant
lives + 21 years; states following Uniform Rule USRAP wait 90 years
then use cy pres to make it vest w/in 90 years.6. Cy Pres Doctrine:
Reforms an invalid interests, w/in Rules limitations, to
approximate most closely the intention of the creator of the
interest. 6. Abolition of Rule: In several states, RAP to interests
in trusts has been abolished IV. CONCURENT INTERESTS TTIPTime:
interest must be created at the same timeTitle: interest must be
created by the same instrument or actInterest: each must hold same
proportionate share and shares must be of the same
durationPossession: each co-owner must have the right to possess
the wholeIf not otherwise stated in the conveyance, it is assumed
that all co-owners receive equal shares
Tenancy in Common (TC): Requires: Possession Survivorship:
NORight of transfer: 1) each co-owner can transfer his share
unilaterally 2) partition is available
Joint Tenancy (JT)Requires: TTIPSurvivorship: YESRight of
transfer: 1) each co-owner can transfer his share unilaterally,
once share is transferred the joint tenancy is severed 2) partition
is available O to A and himself = most places a successful JT has
been created; some still require TTIP
Tenancy by the Entirety (TBE) Requires: TTIP (only to married
persons) (fewer than half the state recognize)Survivorship:
YESRight of Transfer: 1) share can be transferred unilaterally only
after termination of the marriage 2) during marriage shares can be
transferred between the owners 3) during marriage both spouses must
agree to any transfer 4) divorce creates a tenancy in common
A. In the states that do not recognize TBE, a rebuttable
presumption exists that a conveyance of a concurrent estate is
intended to create a tenancy in commonB. In the states that do
recognize TBE, a rebuttable presumption exists that a conveyance of
a concurrent estate to a married couple is intended to create a
TBE, a rebuttable presumption exists that if they are not married,
then the intent is a TC.
First in time, first in right common law: when different
interests arise, the first one created has priority over those
following
People v. Nogarr 405(Right of survivorship existed before the
lien existed and the mortgage was terminated once it transferred
via survivorship)Facts: The Appellant Elaine Wilson and Calvert
Wilson (now deceased) owned property as joint tenants until the
death of Calvert in 1955. Prior to Calverts death, the couple
separated in July of 1954, and thereafter, without Elaines
knowledge or consent, Calvert executed a promissory note to his
parents (Respondents) for $6,440, and then delivered a mortgage to
his parents on the property in question.Reasoning: In this
jurisdiction the act of mortgaging property by one of the tenants
in a joint tenancy is not sufficient to sever the tenancy, and the
interest of the mortgagee will terminate if the mortgaging tenant
dies before the non-mortgaging tenant. Issue: Does the execution of
a mortgage by one joint tenant terminate the joint
tenancy?Discussion: Consider the equities present in this case.
Elaine was an innocent spouse who had no idea that the property had
been mortgaged. The Court seemed to desire a result which would not
harm Elaines interest and reward Calvert and his parents for
Calverts non-disclosure of the mortgage and promissory note.
RIGHTS AND DUTIES OF CONCURRENT OWNERSA. A cotenant who pays
more than his share of a debt secured by mortgage or other lien on
the common property, or of interest falling due on such debt, is
entitled to reimbursement (contribution) from his cotenants to the
extent to which he paid their shares of the indebtedness. (Laura v.
Christian)B. A cotenant in possession of concurrently owned
property cannot be compelled to pay rent to the other cotenants
unless he ousts the other cotenants or prevents them from
enteringC. A cotenant who collects more than his proportionate
share of rent from third parties can be compelled to account to
fellow cotenants for the excess collectedD. A cotenant is usually
not liable to share net profits he makes from a business he runs on
the property UNLESS the business involves an exploitation of the
properties natural resources E. Adverse Possession: In order for
the possession by one cotenant to become adverse to another
cotenant, there must be a disseizen or ouster by some outward act
of ownership of an unequivocal character, overt and notorious, and
of such nature to impart notice to the cotenant that an adverse
possession and disseizen is asserted by the tenant in possession.
(Mercer v. Wayman)F. Must oust the other parties and do something
to show unequivocal Exceptions to actual notification1) Tenant has
no reason to suspect a cotenancy exists2) Tenant makes efforts in
good faith to notify3) Where cotenants have actual knowledge that
the tenant in possession is claiming adversely to their interests4)
In these cases, constructive notice and open and notorious
possession
NON-FREEHOLD ESTATES: LANDLORD AND TENANTLEASEHOLD ESTATES A.
Leases are a unique combination of contact and property lawB. Types
of Tenants: fixed term, periodic, hold-over C. ILLEGAL LEASES 1)
Void: if a lease is exclusively for an illegal purpose (violates
zoning)2) Void: if the formation of the lease is illegal (usually)
Brown v. Southall Realty Co.3) Valid: Lease for some legal and some
illegal purpose is enforceable as to its legal purpose4) Valid: A
lease that requires each party to perform lawful act is valid and
enforceable despite the fact that one of the parties attempts to
substitute the performance of an illegal act for performance of a
required lawful act. (Unlike Brown v. Southall, if a lessor leases
property in violation of a code, and the code does not say
explicitly that renting of substandard property is illegal, then
the lease is valid and the lessor is only in breach of the
lease)
COVENANT OF QUIET ENJOYMENTA. Definition: a promise by LL that
the tenants beneficial enjoyment of the premises will not be
substantially interfered with by certain parties1) Landlord2)
Person or entity, claiming a right through LL3) Person or entity
with superior title to LL B. Covenant is implied in every lease,
commercial and residentialC. 3 ways to assert breach, usually
through actual or constructive eviction D. ACTUAL EVICTIONS 1)
denied physical access 1) Tenant is denied physical access to
premises; either partial or total2) Remedies: 0. Rent abatement; if
tenant is either totally or partially denied access, rent is
totally abatement the landlord cannot apportion his wrong3)
Damages: 0. Loss of benefit of the bargain0. Foreseeable
consequential damages E. CONSTRUCTIVE EVICTIONS 1) Intentional or
Neglect, 2) Uninhabitable, 3) Vacate 1) LL or agent thereof
substantially interferes with the tenants beneficial enjoyment of
the premises but doesnt interfere with actual possession 1)
Intentional interference OR Neglects to do something expressly or
impliedly promised in the lease that is important to the tenants
beneficial enjoyment (on a commercial lease LL has no implied duty
to do repairs/maintenance) 2) MUST make the premises UNINHABITABLE
or un-useable as judged by reasonable community standards3) Tenant
MUST VACATE2) Remedies: 0. Rent abatement3) Damages: right to
damages for loss of the benefit of the bargain and lost profits
depending upon the circumstances F. OTHER BREACHES1) Jurisdictions
are split on whether there must be actual or constructive eviction
2) Many hold that if a tenant has not been evicted then no breach
has occurred but some hold that there may be if0. Tenant has been
substantially deprived of the beneficial use and enjoyment of the
premises and0. Elects not to vacate but to remain in possession0.
He may sue for damages or injunction to enjoin the interference
Warranty of inhabitability is implied in a residential lease
imposes certain duties on a landlord to maintain the premises in
habitable condition Failure to do so may be legal justification for
a tenant's defensive acts, such as moving out (even in the middle
of a lease), paying less rent, withholding the entire rent until
the problem is fixed, making necessary repairs (or hiring someone
to make them and deducting the cost from next month's rent).
POSSESSIONIf it is LLs responsibility to secure Tenant from
holdovers and tenant cannot take possession, then the tenant can
rescind and claim damages (benefit of bargain, foreseeable
consequential damages)
1) AMERICAN RULE: Landlord gives the right to possession but not
actual, tenant must assert actualPolicy: a party to a bargain,
himself without fault, is not responsible for tortious interference
by a stranger; after a lessee takes possession; his only cause of
action for trespass against the trespasser- there is no substantial
difference between a trespass which interrupts possession and one
which precludes it. 2) ENGLISH RULE: LL must provide actual
possessiona. In some jurisdictions the LLs duty it thought to be
the logical consequence of the covenant of quiet enjoyment HOWEVER,
a covenant for QE is only a promise that the LL, his agent, or one
claiming authority through him, will not substantially interfere.
(Hold-overs? No)b. LL implies promise of actual possession in a
lease
HOLD-OVER TENANTThe situation when a tenant of real estate
continues to occupy the premises without the owner's agreement
after the originallease or rental agreementbetween the owner
(landlord) and the tenant has expired. The tenant is responsible
for payment of the monthly rental at the existing rate and terms,
which the landlord may accept without admitting the legality of the
occupancy. A holdover tenant is subject to a notice to quit (get
out) and, if he/she does not leave, to a lawsuit for unlawful
detainer.
Fixture: any physical property that is permanently attached
orfixedtoreal propertywhich once removed will cause permanent
damage to the real propertyTrade fixture:a piece of equipment on or
attached tothe real estatewhich is used in a trade or business.
Trade fixtures differ from other fixtures in that they may be
removed from the real estate (even if attached) at the end of the
tenancy of the business, while ordinary fixtures attached to the
real estate become part of the real estate. The business tenant
must compensate the owner for any damages due to removal of trade
fixtures or repair such damage. (MUST: remove without damage and
before the lease ends.)
DUTIES OF LANDLORDSPersonal Injury: Majority: no liability to
tenant or invitee of tenant unless 1 Hidden dangers of which LL was
aware but did not disclose2 LL unreasonable maintenance of common
and public areas3 Unreasonably defective repairs done by LL4
Defects LL promised to repair but did not disclose Minority: LL
owes a general duty through due care to avoid foreseeable risks if
harm to a tenant or an invitee of a tenant
Third Parties: Traditionally: no liability for injuries due to
the criminal conduct of othersProgressive: Landlords owe a general
duty of reasonable care to their tenants, but the common law does
not impose a duty on private citizens to protect others from
criminal attacks by third parties unless perhaps he has done or has
filed to do something which has foreseeably facilitated the crime.
a. Where LL has negligently failed to meet an independent duty to
maintain the premises and that failure facilitated the crimeb. When
an employee of LL negligently fails to protect the tenantc. When LL
fails to meet a contractual obligation, such as the obligation to
fix a door
NONPAYMENT OF RENT1. Non-payment is grounds for eviction;
however non-payment and late payment are not equivocal2. A lessor
who has knowledge of a tenants breach may waive right to terminate
the lease if he acts in a way that affirms the leases continued
existence
RETALITORY EVICTIONS1) The act of a LL in ejecting or attempting
to eject a tenant from the rented premises, because of the
tenant'scomplaints or activities with which the landlord is not in
accord.2) Is a substantive defense and affirmativecause of
actionthat can be used by atenantagainst LL3) Month to month LLs
can evict for any reason if they give proper notice, however
conduct in pursuit of a habitable dwelling is protected 4) Does not
apply to fix term leases, generally if there was an attempt at an
eviction in a fixed term, it would simply be considered a breach of
the lease. However, if an LL refuses to renew, that is not an
eviction and the defense would not apply5) LL may have a legitimate
reason for eviction; who has the burden?
MITIGATION/ABANDONMENT 1. NOT ALL STATES REQUIRE LL MITIGATION
(working off a property theory of land conveyance rather than a
contract) USUALLY residential LL need to mitigate; commercial
context, likely not. 2. What if LL re-lets (mitigates) in a state
where mitigation is not necessary? He has evicted T interfering
with rights of possession, releasing the T from the lease. 3.
ABANDONMENT? Sometimes construed as an offer to terminate the lease
early which the LL may accept, the act of re-letting would indicate
acceptance and release of T form lease.
ACCELERATION CLAUSE Breach on an installment payment accelerate
all subsequent installments If LL does not have that clause, then
they cannot sue until you are in breach for each installment month
to month How to acceleration clauses work in lease? LL gets the
property and the rent while T is evicted? Yes HOWEVER if/when he
re-lets (mitigates, which he is required to do) T gets a
refund.
WASTE BY TENANT T in LL/T context can be charged with waste for
certain misconduct. Waste (permissive/voluntary) is misconduct
that0. Causes damages to property beyond normal wear and tear0.
Materially reduces the value of the rental premises Voluntary: T
intentionally damages property Permissive: T fails to meet common
law duty to make minor repairs necessary to keep a rental space
wind and water tight (How do we reconcile that with LL
responsibility under warranty of inhabitability? Seems to be
reduced to small repairs or emergency situations) Remedies: Damages
or injunction, not termination of the lease
Laura v. Christian 420 Facts: Laura, owner as tenant in common
of three-fourths of a property called Fireside Lodge, paid money to
preventforeclosureon the property by the mortgagee, and Christian,
owner as tenant in common of one-fourth of the Fireside Lodge,
contributed nothing to the payment.Reasoning: As a general rule a
cotenant who pays more than his share of an indebtedness secured
bymortgageor other lien is entitled to reimbursement or
contribution from the other cotenants to the extent to which he
paid their share of the debt.Holding: Yes, Judgment reversed with
instructions to enter a judgment quieting title to three-fourths of
the Fireside Lodge in Laura and establishing a one-fourth interest
in Christian, subject to a lien securing repayment of his pro-rata
share of the indebtedness paid by Laura to the mortgagee, together
with interest.The general rule is stated as follows, As a general
proposition, a cotenant who pays more than his share of a debt
secured by mortgage or other lien on the common property, or of
interest falling due on such debt, is entitled to reimbursement
(contribution) from his cotenants to the extent to which he paid
their shares of the indebtedness. In this case the Court was faced
with a simple matter of requiring contribution from Christian in an
amount equal to one-fourth of the monies expended by Laura to his
benefit.The Court noted that the general rule was also that the
payment of debt on a property by a cotenant in a tenancy in common
inures to the benefit of the non-paying cotenant, who may then
exercise an option to contribute their share of the payment so
made. The option to pay ones share must be exercised within a
reasonable time. In this case the time was reasonable even though
Christian showed no interest in paying his share until it became
clear that it was to his benefit to do so.The Court noted that its
prior decisions precluded the imposition of a constructive trust in
a suit to quiet title. Thus, the payment of Laura made in behalf of
Christian does not create a constructive trust in favor of Laura
such that Christians one-fourth interest may be quieted in
Laura.Discussion: This case is easily understood and the Court
provides clear rules for the contribution required by cotenants
when one shoulders the burden of debt. A constructive trust is a
concept of equity which is also sometimes called a purchase money
resulting trust, and is operable to vest title to property in a
payor where one pays money for anothers benefit and is not timely
repaid.
Mercer v. Wayman 428Facts: This case involved a dispute between
the Plaintiffs, the widow and children of Fred Mercer, deceased (P)
and the Ds, surviving sons of Lora Wayman, deceased, and the widow
and daughter of Verne Wayman, deceased (D), to set aside oil and
gas leases by the Defendants and to have the Plaintiffs declared
the sole owners of the 40 acre tract in question.Reasoning: The
rule is well settled that the mere possession by one tenant in
common who receives all the rents and profits and pays the taxes
assessed against the property, no matter how long a period, cannot
be set up as a bar against the cotenants. Issue: Are the
Defendantsclaimsbarred by the statute of limitations?Holding: No.
Reversed. In order for the possession by one cotenant to become
adverse to another cotenant, there must be a disseizen or ouster by
some outward act of ownership of an unequivocal character, overt
and notorious, and of such nature to impart notice to the cotenant
that an adverse possession and disseizen is asserted by the tenant
in possession.The deed to Fred Mercer and wife was ineffective to
convey the Defendants, then minors, interests in the land. Thus,
such deed did not constitute color of title and the seven-year
statute of limitations (tax title) was inapplicable.The Plaintiffs,
although in possession for thirty-four years, never made any overt
act, which would serve as notice to the cotenants that they were
claiming adversely to them. The Plaintiffs have failed to meet
their burden of proof.
Brown v. Southall Realty Co. 449 Facts: Appellee, landlord,
brought an action for possession against the Appellant, Brown, for
rent in arrears of $230. Brown contended that no rent was due under
the lease because the lease was an illegal contract, where
landlord, with knowledge of housing regulations violations, entered
into the lease with Brown stating that the premises were habitable
in spite of the violations.Held: no valid lease because there was a
violation, it confers no rights to the landlordNotes: The provision
in this specific case makes it illegal to rent a substandardly
maintained area in the first place, more often than not, rules say
that property must be maintained in such a way, but does not
purport to say that renting a property substandardly maintained is
illegal (though the lessee could seek to enforce the code and the
lessor would be in breach; Court took into account legislative
intent
Jancik v. Department of Housing and Urban Development 459
(Advertising and screening is unlawful when the implication is
discrimination against a potential renter based no sex, religion,
marital status, race, etc.)Facts: Jancik, Petitioner, owns an
apartment building, and ran an ad in a newspaper which was claimed
by the Leadership Council for Metropolitan Open Communities to
violate provisions of the Fair Housing Act (FHA).Issues: Does
Janciks ad violate the FHA provisions such that the words mature
person preferred indicate a non-preference of a particular
protected group?Holding: Yes, petition forreviewdenied.The test for
determining whether an ad indicates a preference or non-preference
of a particular protected group under theFHAis that of the ordinary
reader. The test is stated as the statute is violated if an ad for
housing suggests to an ordinary reader that a particular protected
group is preferred or dispreferred for the housing in question. The
Court holds that this can be shown by subjective evidence of the
intent of the person who places the ad.Discussion: In this case,
the court applied an objective test focused on the content of the
ad and looked to the conduct of Jancik in his conversations to
provide the basis for their decision.
Adrian v. Rabinowitz 486Facts: Defendant Rabinowitz leased store
premises to Plaintiff Adrian to commence on a date certain, and
after thepayment of the first months rent by Plaintiff, the
premises were not available due to a hold over tenant.Issue: Did
the lease contract impose on the lessor a duty of putting the
tenant in actual and legal possession of the premises at the
beginning of the lease term?Holding: Yes, because the express
covenant for quiet enjoyment is generally interpreted to secure the
lessee from acts of hindrance performed by the lessor or his
agents, the express covenant does not protect the lessee from
interference by strangers with his possession. Therefore, for
Plaintiff to prevail the duty must be implied.The Court considers
the question of whether the lessor is under a duty to put the
premises in actual and legal possession of the lessee at the
beginning of the term and finds that there is such a duty. The
Court finds favor with the English rule which states that when the
term oflease is set to commence in the future, there is an implied
undertaking by the lessor that the premises shall be open to the
lessees entry, legally and actually, when the time for possession
arrives. The Court finds that other American jurisdictions impose
such a duty.The actions of the lessor (Defendant) in evicting the
hold over tenant is evidence that the lessor was acting as if there
were a duty to deliver actual and legal possession to the Plaintiff
lessee at the commencement of the lease.The Court found that the
lower court made an error with regard to the computation of
damages. The lower court found that the Plaintiff would have
disposed of at least $2,800 worth of seasonal merchandise during
the time the premises were unavailable, and that Plaintiff was
compelled to sell the merchandise at 25% below cost. The Court
found this formulation to be far too speculative and that the
proper formulation of damages should be the difference between the
actual rental value and rent reserved for the period of the
deprivation of possession.The Court ruled that parol evidence could
be adduced to prove that additional damages should be awarded to
Plaintiff as the result of the breach, but that based on the
evidence in the record, Plaintiff did not make a showing that would
justify theapplicationof such evidence to determine damages.
Further, that the business was a new venture which failed prior to
the ending of the first rent term, and that shows the uncertainty
of measuring damages for loss of the opportunity to sell seasonal
goods.Note:Hold over tenants can be a great problem for landlords.
It makes sense to create a duty forthe landlord to promptly deliver
possession of the premises because the prospective lessee has no
direct legal rights against a hold-over tenant, while the landlord
does have such rights
Blackett v. OlanoffFacts: A landlord rented property to a tenant
running a lounge in an area that was residential. The lease
required the noise not disturb others, but when it did,the
landlorddid not correct the situation.Issue: When the acts of one
tenant prevent the other tenants from enjoying their premises, will
the landlord be liable when the lease prohibits the tenant from
disturbing others?Holding: Yes, occasionally, a landlord has not
intended to violate a tenants rights, but a breach of the landlords
covenant of quiet enjoyment still occurs which flowed as the
natural and probable consequence of the landlords actions,
inactions, or what he permitted to be done. The landlords conduct,
not his intentions, is controlling. Plaintiffs had the ability and
right to control the noise, which caused Defendants to vacate
theirapartmentsbecause of the provision in the lease that regulated
noise. Even though Plaintiffs only knew that there would be a
potential noise problem at the time they gave the lease, experience
demonstrated that an acceptable music level at a lounge is
unacceptable for residential tenants. Because the disturbing
condition was the natural and probable consequence of the
Plaintiffs permitting the lounge to operate in that location, and
since they could control the actions of the lounge, they should not
be able to collect rent for the residential premises that were not
reasonably habitable. Tenants in these situations should be able to
bring a claim againstthe landlord.Note:The covenant of quiet
enjoyment, which is implied in every landlord-tenant relationship,
holds that the landlord promises not to disturb the tenants quiet
enjoyment of his premises. As seen in this case, the landlord will
be liable when the disturbance comes from another tenant.
Commonweallth Building Corp. v. Hirshfield 474F: D rented an
apartment from P and was intending to vacate the premises at the
end of the lease period, but was delayed until the following day in
vacating the premises. P elected, under an ancient rule, to treat
the De as a hold over tenant for another year (the lease period)
and to require rent.I: May the landlord elect to treat a hold-over
tenant under these circumstances such that the landlord may assume
that the lease period should be extended by another year?H: No.
Reversed with judgment for D, A tenant who holds over after the
expiration of his term may, at the election ofthe landlord, be held
to be either a trespasser or tenant for another similar term.
However, the holding over by the tenant must be voluntary. The
Court found that the cases involving hold over tenants proceed on
one of two theories: 1. The voluntary action of the tenant allows
the landlord to assume an intention on the tenants part to create a
second tenancy, or 2. The action of the tenant is such that the
court will hold the tenant liable for a second lease on the
principle of quasi contract. The Court held that the P here should
not be allowed to recover under either theory.D was vacating the
property in good faith and with reasonable speed. There was no
evidence to support a theory that the actions of D in holding over
should give rise to Ps assumption that D was voluntarily holding
over. D chose to not move in the middle of the night of the 30th of
September, but instead chose to wait until morning. Nothing
indicated a desire to renew the lease for another year.D cannot be
held liable on a theory of quasi contract because justice required
an absolute presumption of contract for another term. The lease
itself provided for such an occurrence as holding over, and under
the terms of the lease, P is entitled to collect double rent for
the period of hold over. This agreement is reasonable. Thus, the
only power that P had in case of hold-over was to charge D double
rent for whatever time D held over.Notes: whenever there is a
conflict between some common law rule and an express provision in a
contract which is not in violation of the law, the courts will
generally find favor with the expressed agreement of the parties,
such as in this case.
Richard Barton Enterprises v. Tsern (488)F: Plaintiff Richard
Barton Enterprises (Barton) entered into a lease for commercial
space in an office building with Defendant Tsern. The lease and
earnest money receipt incorporated into the lease provided that
rent was to be $3,000 per month and that the premises should be
made available on December 1, 1991, and that lessor was required to
fix aleaky roofand repair the freight elevator to good working
order. The elevator was sporadically repaired and not always up to
code for the entirety of the lease.I: Does an implied warranty of
suitability for a particular purpose extend to commercial leases
such as this one, which makes the obligation to pay rent dependent
on the lessors obligation to maintain the premises?H: Yes. Affirmed
[however, the trial court incorrectly computed
damages].Traditionally, lease covenants were independent of the
lessees obligation to pay rent. To ameliorate this rule, the courts
developed the concept of constructive eviction, but under that
concept the lessee has to quit the premises prior to withholding
rent. The Court notes that the more modern view is to treat the
landlord-tenant relationship under concepts from contract and tort
law.The implied contract of habitability applicable to residential
leases is held to extend to commercial leases as well in the form
of an implied warranty of suitableness for a particular purpose.
The lessees obligation to pay rent is dependent on the lessors
performance of essential covenants.Only a significant breach of a
covenant by the lessor can give rise to the withholding of rent by
the lessee. The Court held that the covenants of the Defendant were
significant inducements to the Plaintiff to rent the property, and
that the working elevator was vital to Plaintiffsbusiness.The
lessee is entitled to abate rent by an amount equal to the reduced
value of the premises due to the lessors breach. The trial court
was wrong to award damages for the cost of repairing the
elevator.
Handler v. Horns (512) (Trade fixtures may be removed so long as
doing so does not case permanent damage) F: This case involves a
dispute as to whether certain fixtures placed by a tenant on a
leased premises may be removed, or if the fixtures become the
property ofthe landlord. Meat packing plant. The tenant was given
the right to remove any and all trade fixtures that belong to
tenant or which had been installed by tenant except those that are
so fixed as to become part of the building such that their removal
could not be accomplished without causing material damage to the
premises. When the term of this lease expired the parties went on
year to year. Fred died in 1945 and left the business, including
any fixtures, to his son, Defendant Henry Horns. Hazel Handler,
Plaintiff, who owns an undivided one-third of the building sued for
partition. Plaintiff claimsthat all the improvements made by Fred
to the building became part of the building and may not be removed
from the building. The case was referred to a special master who
reported that the premises could not be partitioned but should be
sold as one parcel and that the fixtures placed by Defendant had
become part of the building. The Vice Chancellor found that the
tenant intended to make the fixtures become partof the real estate
and that it constituted one single business entity. Defendant
appealed.I: May the tenant in possession remove the trade
fixtures?H: Yes. So long as the removal does not cause damageto the
premises. Case remanded for a determination of what may be
removed.The ancient rule was that whatever is fixed to the realty
becomes a part of the realty and may not be removed. In order to
encourage trade and industry, this ancient rule has been subjected
to exceptions for fixtures placed in premises for businesspurposes.
The public policy is such that the widest possible latitude is
given to tenants in commercial leases.The general rule in modern
law is that trade fixtures may be removed by the tenant so long as
the removal does not case material damage to the premises. Trade
fixtures are defined as any article annexed to the property for the
purpose of aiding the business conducted by the tenant.In the
original lease the tenant was only required to deliver up those
fixtures already in place at the commencement of the lease. The
provision did not extend to those fixture placed after the lease
began. The second lease provides that the trade fixtures placed by
tenant may be removed so long as the removal does not materially
damage the premises.Because there is expert testimony that the
fixtures in question could be removed without causing material
injury to the property, the case should be remanded to exclude from
the sale of the property those fixtures which may be removed
without causing material damage to the premises.
Walls v. Oxford Management 517(Duty of LL to tenants to protect
against third parties)Facts: On December 5, 1988, P Walls was
sexually assaulted in her vehicle parked on the premises of Bay
Ridge Apartment Complex. The Ds in this case are the owners of the
apartment complex and the management of the complex. During the two
years prior to the assault on P there were eleven auto thefts,
three attempted auto thefts, and thirty-one incidents of criminal
mischief/ theft. No sexual assaults were reported. P brought an
action in federal court alleging that Ds had a duty to hire
competent management, provide reasonable security, a duty to warn
residents of lack of security, and a duty to warn residents of the
numerous criminal activities which had occurred. The P alleges that
Ds breached the duties listed and that such breach was the
proximate cause of her injuries.Issues: 1) Does the landlord have a
duty to secure tenants against criminal attack? 2) Is the implied
warranty of habitability breached bycriminal actsof third
persons?H: No. Landlords owe a general duty of reasonable care to
their tenants, but the common law does not impose a duty on private
citizens to protect others from criminal attacks by third parties.
Thus, the Court will not place such a duty on landlords, unless the
conduct of the parties merits a finding that one of the exceptions
to the general rule is implicated.The exceptions of the general
rule against holding private citizens liable from attacks by third
parties fall into four categories: 1. When a special relationship,
such as innkeeper-guest or carrier-passenger, exists. This type of
relationship is not present in a landlord-tenant relationship.2.
When a condition brought about by the defendant is a special
temptation to foreseeable criminal conduct. This is how most cases
holding landlords liable are decided. 3. When there is an
overriding foreseeability of criminal attack. This is not adopted
here. 4. Under the general tort principle that one who assumes a
duty thereafter must act with reasonable care.The Court held that
while landlords have no general duty to protect tenants from
criminal attack, such a duty may arise when the landlord has
created or is responsible for a known defective condition on the
premises which creates a foreseeable risk of criminal conduct. A
landlord who undertakes, gratuitously or under contract, to provide
security for anapartment complexmust act thereafter with reasonable
care. Unless the conduct of the landlord fits into one of those
exceptions, the landlord will not be held liable for criminal
attack on residents by third persons.The implied warranty of
habitability in residential lease agreements protects tenants
against structural defects, but does not require landlords to take
affirmative measures to provide security against criminal attack.
This does not limit a recovery shouldthe landlordviolate an express
covenant in the lease or through an attack through a violation of
the housing code.
Foundation Development Corp. v. Loehmanns (525)(Material and
non-material breaches) F: In this case tenant ina commercial
leasefailed to pay an amount due under the lease (late by 2 days),
the lessor sought to terminate the lease due to the breach, which D
contended was a trivial breach. (LL really just was looking for a
way to evict the tenants b/c they were locked into a 30 yr. lease
w/ no rent increase)I: Does the trivial breach of lessee justify
forfeiture of the premises and cancellation of the lease?H: No.
Although there is a statute in this jurisdiction which confers a
right to lessor to terminate a commercial lease for a breach and
take possession, the Court will not read the statute so broadly as
to state that any breach, at any time is sufficient to confer such
a right. The Court found that the legislature could not have meant
to confer a right to landlord to terminate a commercial lease under
any and all circumstances, no matter how trivial.The Court finds
that the breach (a late payment) was very insignificant and
considered the question of what would happen in case of a harsh
rule of forfeiture for any breach where the check was late by mere
minutes. The Court found that the results under so harsh a rule
would be ridiculous.
Edwards v. Habib (531)(Retaliatory Eviction) F: A tenant
reported sanitary code violations on leased premises and thereafter
the landlord moved to evict the tenant. Appellant Edwards rented
housing property from Appellee Habib on a month to month basis in
March 1965. Edwards then complained to the Department of Licenses
and Inspections of sanitary code violations in the leased premises,
which upon inspection uncovered 40 violations and ordered the
landlord to correct them. Then, the landlord gave Edwards a
statutory thirty day notice to vacate and obtained a default
judgment for possession of the premises.I: Does the landlord have
an absolute right under these circumstances to terminate the month
to month tenancy and evict the tenant?H: No. The promulgation of
the housing code by the District of Columbia Commissioners under
authority from Congress implies a change in the relative rights as
between landlords and tenants.Proof of retaliatory motive is a
defense to any action of eviction where the alleged retaliation
occurs due to the tenants reporting of housing code
violations.Edwards challenged the constitutionality of the statute
under whichthe landlord may elect to terminate a month to month
tenancy upon a thirty day notice to quit, where judicial
enforcement of such statute would render state aid to the landlord
in depriving tenant of a property right, namely, the tenants right
to report housing code violations. The Court found that this issue
need not be decided. Instead, the Court would allow the tenant to
present proof in an eviction proceeding of a retaliatory motive by
landlord in the instituting of the eviction suit.Because the Court
has a duty, as a court of equity, to consider the social
implications of its decisions, the Court found that the public
policy of protecting tenants in slum housing from inequalities
resulting from their social conditions must be considered in
rendering this decision.The Court found that the balance between
the statutes authorizing the landlord to evict a month to month
tenant after thirty day notice and the housing code statutes can
only be struck by holding the eviction statutes inapplicable where
the courts aid is sought to effect an eviction in retaliation for
reporting housing code violations.
Homeland, Inc. (537)F: D Homeland, leased office space from
Schlesinger P. Homeland abandoned the property after 2 years,
premises were subsequently re-let to another tenant for a higher
rent and longer term (Sebastian 3yrs), who also defaulted. P
attempts to re-let again, create a third lease. P brings claim for
the 5 yr. lease (minus rent properly paid) D claims this was not
merely mitigation, this second lease was longer and for different
terms therefore not mitigation, you are creating an entirely new
lease (court not buying it) I: When a tenant toa commercial
leaseabandons the premises prior to the expiration of the lease and
the lessor re-lets the premises for a longer term than the original
lease and for more rent, does such re-letting as a matter of law
terminate the original lease, freeing the original tenant from any
claim for damages which occurred after the re-letting?H: No.
Following abandonment landlordhas a duty to mitigate damages by
seeking a suitable tenant to re-let the premises. When the tenant
abandons the leased property the tenant surrenders his estate in
the property, but is still liable for damages from the breach of
contract.The tenant who breached remains liable for the difference
between the agreed price of the rent and the fair rental value of
the premises, which is an amount the law presumes the lessor can
obtain with reasonable efforts to re-let the premises.The mere act
of re-letting for a longer or shorter term does not, without more,
bar the lessors claim for damages from the breach. The lessor is
not required to mitigate damages by re-letting the premises at less
than the fair rental value.Evidence of the lessors reasonable
efforts to re-let the premises in question are found when lessor
stated that at all times he tried to re-let the property, and that
there was asurplusof office space in the Portland area during the
relevant portion of time. Because the re-letting did not cancel the
original lease, the receiver for Homeland is liable for $26,460,
which is the amount for the rent remaining in the original term
during which time the building was vacant.
If a T abandons what are remedies for the LL?
Property ReviewWednesday 12 and Friday 14 Office HoursExam
StructureMid-term 40% 18 MC Questions (Estates and Future
Interests) 2 Essays Exam Tips Assume audience has very limited
knowledge; be thorough in explanations Write and advocate for both
sides; be predictive, what will P/D attempt to argue?
Life Estates
1) A to C, but if C fails to reach 21, then to A (C19)C: FSSCS;
A: ROR
2) A to B for life, then to C, but if C fails to reach 21, then
to AB: LE C: vested remainder subject to a complete divestment (if
C gets the land at 20, but the dies before 21, land to A (ROR); if
C reaches 21 then C gets a FSA)
3) A to B for life, then to C, if C is at least 21 when B dies,
else to A. (age goes from being a condition sub to condition prec.
(2))B: LE C: contingent remainder in FSA A: reversions always
follow contingent remainders
4) A to B for life if C is at least 21 when B dies, else to D.
B: LE C: contingent remainder in FSA D: alternative contingent
remainder A: reversion? We recognize the rule of destructibility; B
may abandon the LE before dying