REAL PROPERTY REAL PROPERTY i. REAL PROPERTY TABLE OF CONTENTS
I. ESTATES IN LAND . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
A. IN GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 B.
PRESENT POSSESSORY ESTATES . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 1 1. Fee Simple Absolute . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 1 2. Defeasible Fees . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 1 1. Fee Simple Determinable (and Possibility of
Reverter) . . . . . . . . . . . . . . . . 1 1. 1) Correlative
Future Interest in GrantorPossibility of Reverter . . . . 2 a)
Possibility of Reverter Need Not Be Expressly Retained . . . . . .
. 2 b) Transferability of Possibility of Reverter . . . . . . . . .
. . . . . . . . . . . 2 2. 2) Correlative Future Interest in Third
PartyExecutory Interest . . . . 2 2. Fee Simple Subject to
Condition Subsequent (and Right of Entry) . . . . . . . 2 1. 1)
Correlative Future Interest in GrantorRight of Entry . . . . . . .
. . . . 3 a) Failure to Reserve Right of Entry . . . . . . . . . .
. . . . . . . . . . . . . . . 3 b) Waiver of Right of Entry . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 (1)
Inaction by Itself Not a Waiver . . . . . . . . . . . . . . . . . .
. . . . . . 3 c) Transferability of Right of Entry . . . . . . . .
. . . . . . . . . . . . . . . . . . 3 2. 2) Correlative Future
Interest in Third PartyExecutory Interest . . . . 3 3. 3)
CompareFee Simple Determinable . . . . . . . . . . . . . . . . . .
. . . . . . . . 3 a) Construction of Ambiguous Language . . . . . .
. . . . . . . . . . . . . . . 4 3. Fee Simple Subject to an
Executory Interest . . . . . . . . . . . . . . . . . . . . . . . .
. 4 4. Limitations on Possibilities of Reverter and Rights of Entry
. . . . . . . . . . . . 5 5. Conditions and Limitations Violating
Public Policy . . . . . . . . . . . . . . . . . . . 5 1) Restraints
on Marriage . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 5 2) Provisions Involving Separation or Divorce
. . . . . . . . . . . . . . . . . . . . . 5 3. Fee Tail . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 5 4. Life Estate . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 5 a. Life Estates by Marital
Right (Legal Life Estates) . . . . . . . . . . . . . . . . . . . .
5 b. Conventional Life Estate . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 6 1) For Life of
Grantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 6 2) Life Estate Pur Autre Vie (Life of
Another) . . . . . . . . . . . . . . . . . . . . . 6 a)
Inheritability .......................................... 7 c.
Rights and Duties of Life TenantDoctrine of Waste . . . . . . . . .
. . . . . . . . 7 1) Affirmative (Voluntary) WasteNatural Resources
. . . . . . . . . . . . . . 7 a) Open Mines Doctrine . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 2. 2)
Permissive Waste . . . . . . . . . . . . . . . . . . . . . . . . .
. . . a) Obligation to Repair . . . . . . . . . . . . . . . . . . .
. . b) Obligation to Pay Interest on Encumbrances . c) Obligation
to Pay Taxes . . . . . . . . . . . . . . . . . . . d) Special
Assessments for Public Improvements (1) Apportionment of Costs . .
. . . . . . . . . . . . e) No Obligation to Insure Premises . . . .
. . . . . . f) No Liability for Third Partys Torts. . . . . . . . .
3. 3) Ameliorative Waste . . . . . . . . . . . . . . . . . . . . .
. . . . . ............... 7 ............... 8 ............... 8
............... 8 ............... 8 ............... 8
............... 8 ............... 8 ............... 8
ii. REAL PROPERTY 1. a) CompareLeasehold Tenant . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 2. b) CompareWorthless
Property . . . . . . . . . . . . . . . . . . . . . . . . . . d.
Renunciation of Life Estates . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 5. Estates for Years, Periodic
Estates, Estates at Will, Tenancies at Sufferance . C. FUTURE
INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 1. Reversionary
InterestsFuture Interests in Transferor . . . . . . . . . . . . . .
. . . . a. Possibilities of Reverter and Rights of Entry . . . . .
. . . . . . . . . . . . . . . . . . b.
Reversions.................................................... c.
All Reversionary Interests Are Vested . . . . . . . . . . . . . . .
. . . . . . . . . . . . 2.
Remainders.......................................................
a. Indefeasibly Vested Remainder . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . b. Vested Remainder Subject to
Open . . . . . . . . . . . .................... 1) Divesting
Interests Are Executory Interests .................... 2) Effect on
Marketability of Title . . . . . . . . . . .................... c.
Vested Remainder Subject to Total Divestment . ....................
d. Contingent Remainder . . . . . . . . . . . . . . . . . . . . .
.................... 1) Subject to Condition Precedent . . . . . .
. . . . .................... 2) Unborn or Unascertained Persons . .
. . . . . . .................... 3) Destructibility of Contingent
Remainders . . .................... a) Rule Abolished . . . . . . .
. . . . . . . . . . . . . .................... b) Related Doctrine
of Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) CompareInterests Created Simultaneously . . . . . . . . . . .
e. Rule in Shelleys Case (Rule Against Remainders in Grantees
Heirs) . . . f. Doctrine of Worthier Title (Rule Against Remainders
in Grantors Heirs)
....................................................... 3.
Executory Interests . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . a. Shifting
Executory InterestDivests a Transferee . . . . . . . . . . . . . .
. . . . b.
SpringingExecutoryInterestFollowsaGaporDivestsaTransferor. c.
Executory Interest Follows a Fee . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . d. Differences Between Executory
Interests and Remainders . . . . . . . . . . . . 4. Importance of
Classifying Interests In Order . . . . . . . . . . . . . . . . . .
. . . . . . . 5. Transferability of Remainders and Executory
Interests . . . . . . . . . . . . . . . . . . a. Vested Remainders
Are Transferable, Devisable, and Descendible . . . . . b.
Contingent Remainders and Executory Interests Are TransferableInter
Vivos . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . c. Contingent Remainders
and Executory Interests Are Usually Devisable and Descendible . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . d. Any Transferable Future Interest Is
Reachable by Creditors . . . . . . . . . . e. Practical Ability to
Transfer Marketable Title . . . . . . . . . . . . . . . . . . . . .
. 6. Class Gifts . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . ..................... . 1. Definitional Problems .
. . . . . . . . . . . . . . . . . . . ..................... . 1)
Dispositions to Children . . . . . . . . . . . .
..................... . 2) Dispositions to Heirs . . . . . . . . .
. . . . . . ..................... . 3) Dispositions to Issue or
Descendants ..................... . 4) Class Members in Gestation .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.
When the Class ClosesThe Rule of Convenience. . . . . . . . . . . .
. . . . . . . 1) Outright GiftClass Closes at Time Gift Is Made . .
. . . . . . . . . . . . a) No Class Members Alive at Testators
DeathClass Stays Open . . 9 . 9 . 9 . 9 . 9 10 10 10 11 11 11 12 13
13 13 14 14 15 15 16 16 16 16 17 18 18 18 19 19 19 20 20 21 21 21
21 21 21 21 21 22 22 22 22 22
REAL PROPERTY iii. 2. 2) Postponed GiftClass Closes at Time
Fixed for Distribution . . . . . 23 3. 3) Dispositions Subject to
Condition of Reaching Given Age . . . . . . . . . 23 4. 4) Rule of
Convenience Is a Rule of Construction Only . . . . . . . . . . . .
. 24 7.
Survival..........................................................
24 a. Express Words of Survival . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 24 b. Implied Contingency
of SurvivalGifts to Issue, Descendants, or Heirs
...................................................... 25 4. TRUSTS
............................................................. 25 1.
Private Trust Concepts and Parties . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 25 a. Settlor
....................................................... 25 b.
Trustee ...................................................... 25
c. Beneficiaries..................................................
25 d. Res..........................................................
25 e. Application of Rule Against Perpetuities . . . . . . . . . .
. . . . . . . . . . . . . . . . . 25 2. Creation of Trusts . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 26 a. Inter Vivos Conveyance . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26 b. Inter Vivos Declaration . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 26 c. Testamentary
Conveyance . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 26 d. Pour-Over into Existing Trust . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 3.
Charitable Trusts . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 26 a.
Beneficiaries.................................................. 26
b. Application of Rule Against Perpetuities . . . . . . . . . . . .
. . . . . . . . . . . . . . . 26 c. Cy Pres Doctrine . . . . . . .
. . . . . . . . . . . . . . . . ....................... 27 d.
Enforcement of Charitable Trusts . . . . . . . . .
....................... 27 5. THE RULE AGAINST PERPETUITIES . . . .
. . . . . . . ....................... 27 1. Analysis of the Rule .
. . . . . . . . . . . . . . . . . . . . . . . .
....................... 27 a. When the Perpetuities Period Begins
to Run ....................... 27 1) WillsDate of Testators Death .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 2)
Revocable TrustsDate Trust Becomes Irrevocable . . . . . . . . . .
. . . 27 3) Irrevocable TrustsDate Trust Is Created . . . . . . . .
. . . . . . . . . . . . 27 4) DeedsDate Deed Is Delivered with
Intent to Pass 2. Must Vest . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 1) Wait and See Rule . . . . . . .
. . . . . . . . . . . . . . . . . . 3. If at All . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. Lives
in Being . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 1) Who Can Be Used as Measuring Lives . . . . . . . . . .
2) Reasonable Number of Human Lives Can Be Used 5. Interests Exempt
from Rule . . . . . . . . . . . . . . . . . . . . . . . 1) Gift
Over to Second Charity . . . . . . . . . . . . . . . . . . . 2)
Vested Interests . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . a) CompareClass Gifts Are Subject to Rule . . 3)
Reversionary Interests . . . . . . . . . . . . . . . . . . . . . .
. . Title . . . . . . . . . 28 .............. 28 .............. 29
.............. 29 .............. 29 .............. 30
.............. 30 .............. 31 .............. 31
.............. 32 .............. 32 .............. 32 a)
CompareExecutory Interests Are Subject to Rule . . . . . . . . . 32
f. Consequence of Violating the RuleInterest Is Stricken . . . . .
. . . . . . . . 32 1) ExceptionInfectious Invalidity . . . . . . .
. . . . . . .............. 32 2. The Rule in OperationCommon
Pitfall Cases. . . . . . . . . . . .............. 33 a. Executory
Interest Following Defeasible Fee Violates the Rule . . . . . . . .
. 33 b. Age Contingency Beyond Age Twenty-One in Open Class . . . .
. . . . . . . . . 34
iv. REAL PROPERTY c. The Fertile Octogenarian . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 4.
The Unborn Widow or Widower . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 34 5. The Administrative Contingency . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 6.
Options and Rights of First Refusal . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 35 1) Options
.................................................. 35 a) Reasonable
Time Limit May Be Inferred . . . . . . . . . . . . . . . . . . 36
b) Options Connected to Leaseholds 2) Rights of First Refusal. . .
. . . . . . . . . . 3. Application of the Rule to Class Gifts . . .
. . . . . a. Bad-as-to-One, Bad-as-to-All Rule . . . . b. Class
Closing Rules May Save Disposition c. Gift to Subclass Exception .
. . . . . . . . . . . d. Per Capita Gift Exception . . . . . . . .
. . . . . . . . . . . . ........................ 36 4. Perpetuities
Reform Legislation . . . . . . . . . . . . . . 5. Technique for
Analysis of Perpetuities Problems a. Determine What Interests Are
Created . . . . b. Apply the Rule . . . . . . . . . . . . . . . . .
. . . . . . . ..... ..... ..... ..... ..... ..... ..... ..... .....
..... ................... 36 ................... 36
................... 36 ................... 37 ...................
38 ................... 38 ................... 38
................... 39 ................... 39 ...................
39 ................... 39 ................... 39
................... 39 ................... 40 ...................
40 ................... 40 ................... 40
................... 40 ................... 40 ...................
40 ................... 41 ................... 41
................... 41 ................... 41 ...................
41 ................... 41 ................... 41 c. Apply Reform
Statute . . . . . . . . . . . . . . . . . . . . . . . F. THE RULE
AGAINST RESTRAINTS ON ALIENATION 1. Types of Restraints on
Alienation . . . . . . . . . . . . . . . . . . 2. Restraints on a
Fee Simple . . . . . . . . . . . . a. Total Restraints . . . . . .
. . . . . . . . . . . b. Partial Restraints . . . . . . . . . . . .
. . . . 1) Reasonable Restraints Doctrine 2) Discriminatory
Restraints . . . . . a) Fourteenth Amendment .. b) Fair Housing Act
. . . . . . .. 3. Restraints on a Life Estate . . . . . . . . . .
.. a. Legal Life Estate . . . . . . . . . . . . . . .. b. Equitable
Life Estate . . . . . . . . . . . .. 4. Restraints on Future
Interests . . . . . . . .. a. Vested Remainders in Fee Simple . ..
b. Vested Remainders for Life . . . . . . .. c. Contingent
Remainders . . . . . . . . . .. ........... ........... ...........
........... ........... ........... ........... ...........
........... ........... ........... ........... ...........
........... 5. Other Valid Restraints on Alienation . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 41 a.
Reasonable Restrictions in Commercial Transactions . . . . . . . .
. . . . . . . . 41 b. Options and Rights of First Refusal . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 42 c.
Restrictions on Transferability of Leaseholds . . . . . . . . . . .
. . . . . . . . . . . . 42 G. CONCURRENT ESTATES . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 42 1. Joint Tenancy . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 1.
Creation ..................................................... 42
1) Four Unities Required . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 42 2) Modern Law . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 42 3) Express Language Required . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 43 2. Severance
.................................................... 43 1) Inter
Vivos Conveyance by One Joint Tenant . . . . . . . . . . . . . . .
. . . . 43 a) When More than Two Joint Tenants . . . . . . . . . .
. . . . . . . . . . . . 43 b) Transactions that May Not Result in
Severance . . . . . . . . . . . . . 43
REAL PROPERTY v. (1) Judgment Liens . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 43 (2)
Mortgages........................................ 44 (3) Leases
........................................... 44 (a) Death of Lessor
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 2)
Contract to Convey by One Joint Tenant . . . . . . . . . . . . . .
. . . . . . . . . 44 a) CompareExecutory Contract by All Joint
Tenants . . . . . . . . 44 (1) Common Law ViewJoint Tenancy
Continues . . . . . . . . . 45 (2) Other CourtsTenancy in Common .
. . . . . . . . . . . . . . . . . 45 3. 3) Testamentary Disposition
by One Joint Tenant Has No Effect . . . . . 45 a) CompareSecret
Deeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
45 4. 4) Effect of One Joint Tenants Murdering Another . . . . . .
. . . . . . . . . . 45 2. Tenancy by the Entirety . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 45 a. Right of Survivorship . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 46 b. Severance
Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 46 c. Individual Spouse Cannot Convey
or Encumber . . . . . . . . . . . . . . . . . . . . 46 3. Tenancy
in Common . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 46 4. Incidents of Co-Ownership
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 46 a.
Possession.................................................... 46
b. Rents and Profits . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 46 c. Effect of One
Concurrent Owners Encumbering the Property . . . . . . . . 46 d.
Ouster....................................................... 47 e.
Remedy of Partition . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 47 1) Restraint on
Partition by Co-Tenants . . . . . . . . . . . . . . . . . . . . . .
. . . 47 f. Expenses for Preservation of PropertyContribution . . .
. . . . . . . . . . . . 48 1) RepairsContribution May Be Compelled
for Necessary Repairs . 48 2) ImprovementsNo Contribution or Setoff
. . . . . . . . . . . . . . . . . . . . . 48 3) Taxes and
MortgagesContribution Can Be Compelled . . . . . . . . . 48 g. Duty
of Fair Dealing Among Co-Tenants . . . . . . . . . . . . . . . . .
. . . . . . . . . 48 II. LANDLORD AND TENANT . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 48 A. NATURE OF LEASEHOLD . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 48 1. Tenancies
for Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 49 a. Fixed Period of Time .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 49 b. Creation
..................................................... 49 c.
Termination .................................................. 49
1. 1) Breach of Covenants . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 49 a) Failure to Pay Rent . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
49 2. 2) Surrender ................................................
49 2. Periodic Tenancies . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 1.
Creation ..................................................... 50
1) By Express Agreement . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 50 2) By Implication . . . . . . . .
. . .................................. 50 3) By Operation of Law .
. . . . .................................. 50 a) Tenant Holds Over
. . . .................................. 50 b) Lease Invalid . . .
. . . . .................................. 50 2. TerminationNotice
Required .................................. 50 3. Tenancies at Will
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 51 a. Creation
..................................................... 51
vi. REAL PROPERTY b. Termination
.................................................. 51 4. Tenancies
at Sufferance . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 51 5. The Hold-Over Doctrine .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 52 a.
Eviction...................................................... 52
b. Creation of Periodic Tenancy . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 52 1) Terms
................................................... 52 2) Altered
Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 52 c. What Does Not Constitute Holding
Over . . . . . . . . . . . . . . . . . . . . . . . . . . 52 d.
Double Rent Jeopardy . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 52 e. Forcible Entry Statutes
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 53 B.
LEASES.............................................................
53 1. Common LawLease Covenants Independent . . . . . . . . . . . .
. . . . . . . . . . . . . 53 2. Modern TrendLease Covenants
Dependent . . C. TENANT DUTIES AND LANDLORD REMEDIES 1. Tenants
Duty to Repair (Doctrine of Waste) . . . a. Types of Waste . . . .
. . . . . . . . . . . . . . . . . . . . 1) Voluntary (Affirmative)
Waste . . . . . . . 2) Permissive Waste . . . . . . . . . . . . . .
. . . . 3) Ameliorative Waste . . . . . . . . . . . . . . . .
........................ 53 ........................ 54
........................ 54 ........................ 54
........................ 54 ........................ 54
........................ 54 a) LiabilityCost of Restoration . . . .
. . . . . . . . . . . . . . . . . . . . . . . 54 b) Modern
ExceptionValue of Premises Decreasing . . . . . . . . . . 54 2.
Destruction of the Premises Without Fault . . . . . . . . . . . . .
. . . . . . . . . . . . 55 1) Majority ViewTenant Can Terminate
Lease . . . . . . . . . . . . . . . . . . 55 3. Tenants Liability
for Covenants to Repair . . . . . . . . . . . . . . . . . . . . . .
. . . 55 1) Rebuilding After Structural Damage or Casualty
Destruction . . . . . 55 2) Repairing Ordinary Wear and Tear . . .
. . . . . . . . . . . . . . . . . . . . . . . 55 2. Duty to Not Use
Premises for Illegal Purpose . . . . . . . . . . . . . . . . . . .
. . . . . . . . 56 a. Occasional Unlawful Conduct Does Not Breach
Duty . . . . . . . . . . . . . . . . 56 b. Landlord
RemediesTerminate Lease, Recover Damages . . . . . . . . . . . . 56
3. Duty to Pay Rent . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 56 a. When Rent
Accrues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 56 b. Rent Deposits . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 56 c. Termination of Rent LiabilitySurrender . . . . . .
. . . . . . . . . . . . . . . . . . . 56 4. Landlord Remedies . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 56 1. Tenant on Premises But Fails to Pay
RentEvict or Sue for Rent . . . . . . 56 1) DistressLandlords Lien
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
57 2. Tenant AbandonsDo Nothing or Repossess . . . . . . . . . . .
. . . . . . . . . . . . 57 1) Landlord Does NothingTenant Remains
Liable . . . . . . . . . . . . . . . 57 2) Landlord
RepossessesTenants Liability Depends on Surrender . . 57 a) Acts
that Constitute Acceptance of Surrender . . . . . . . . . . . . . .
57 b) Acts that Do Not Constitute Acceptance of Surrender . . . . .
. . . 57 D. LANDLORD DUTIES AND TENANT REMEDIES . . . . . . . . . .
. . . . . . . . . . . . . . 57 1. Duty to Deliver Possession of
Premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 58 a. Landlord DutyMust Deliver Actual Possession . . . . . .
. . . . . . . . . . . . . . 58 b. Tenant RemedyDamages . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
2. Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 58 a. Actual
Eviction . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 58 b. Partial Actual Eviction
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 58
REAL PROPERTY vii. 1. 1) Partial Eviction by LandlordEntire Rent
Obligation Relieved . . . 58 2. 2) Partial Eviction by Third
PersonRent Apportioned . . . . . . . . . . . . 58 c. Constructive
Eviction . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 58 3. Implied Warranty of Habitability .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 59 a. StandardReasonably Suitable for Human Residence . . . . . .
. . . . . . . . . 59 b.
Remedies..................................................... 59 4.
Retaliatory Eviction . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 59 5.
Discrimination ....................................................
60 5. ASSIGNMENTS AND SUBLEASES . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 60 1. Consequences of
Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 60 a. Covenants that Run with the Land . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 b.
Rent Covenant Runs with the Land . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 61 1. 1) Reassignment by
AssigneePrivity of Estate with Landlord Ends . 61 a) Effect of
Assignee Assuming Rent Obligation . . . . . . . . . . . . . . . 61
2. 2) Original Tenant Remains Liable . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 61 2. Consequences of Sublease . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 61 1. Liability of Sublessee for Rent and Other Covenants
. . . . . . . . . . . . . . . . . 61 1) Termination for Breach of
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 62 2.
Assumption by Sublessee . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 62 3. Rights of Sublessee. . .
. . . . . . . . . . . . . . ............................ 62 3.
Covenants Against Assignment or Sublease
............................ 62 a. Strictly Construed Against
Landlord . . ............................ 62 b. Waiver of Covenant
. . . . . . . . . . . . . . . . . ........................... 62 c.
Continuing Waiver . . . . . . . . . . . . . . . . .
............................ 62 d. Transfer in Violation of Lease
Not Void ........................... 62 e.
Reasonableness................................................ 62
4. Assignments by Landlords . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 63 a. Right to Assign .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 63 b. Rights of Assignee Against Tenants
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 c.
Liabilities of Assignee to Tenants . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 63 6. CONDEMNATION OF LEASEHOLDS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 63 1. Entire Leasehold Taken by Eminent DomainRent Liability
Extinguished . 63 2. Temporary or Partial TakingTenant Entitled to
Compensation Only . . . . . 63 7. TORT LIABILITY OF LANDLORD AND
TENANT . . . . . . . . . . . . . . . . . . . . . . . 63 1.
Landlords Liability . . . . . . . . . . . . . . . . . . . . . . . .
. . . . a. Concealed Dangerous Condition (Latent Defect) b. Common
Areas . . . . . . . . . . . . . . . . . . . . . . . . . . .
.................... 63 .................... 64
.................... 64 .................... 64
.................... 64 .................... 64
.................... 64 .................... 64
.................... 65 c. Public Use . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . d. Furnished Short-Term Residence .
. . . . . . . . . . . e. Negligent Repairs by Landlord . . . . . .
. . . . . . . . f. Landlord Contracts to Repair . . . . . . . . . .
. . . . . . . . . . 2. Modern TrendGeneral Duty of Reasonable Care
.a. Defects Arising After Tenant Takes Possessionb. Legal Duty to
Repair . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 65 c.
Security...................................................... 65
3. Tenants Liability . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 65 III.
FIXTURES
..............................................................
65
viii. REAL PROPERTY 1. IN GENERAL . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 65 2. CHATTELS INCORPORATED INTO STRUCTURE ALWAYS
BECOME FIXTURES
.......................................................... 66 3.
COMMON OWNERSHIP CASES . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 66 1. Annexors Intent Controls in
Common Ownership Cases . . . . . . . . . . . . . . . . . 66 a.
Constructive Annexation . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 66 b. Vendor-Purchaser Cases .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 66 c. Mortgagor-Mortgagee Cases . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 66 2. Effect of
Fixture Classification . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 67 a.
Conveyance................................................... 67 b.
Mortgage..................................................... 67 c.
Agreement to Contrary . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 67 4. DIVIDED OWNERSHIP CASES .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 67 1. Landlord-Tenant
.................................................. 67 a. Agreement
................................................... 67 b. No Intent
If Removal Does Not Cause Damage. . . . . . . . . . . . . . . . . .
. . . . 68 c. Removal Must Occur Before End of Lease Term . . . . .
. . . . . . . . . . . . . . . 68 d. Tenant Has Duty to Repair
Damages Resulting from Removal . . . . . . . . 68 2. Life Tenant
and Remainderman . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 68 3. Licensee and Landowner . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 68 4. Trespasser and Landowner . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 68 a.
Trespassers Recovery Limited to Value Added to Land . . . . . . . .
. . . . . . 68 5. THIRD-PARTY CASES . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
1. Third Person Claims Lien on Chattel Affixed to Land . . . . . .
. . . . . . . . . . . . . 68 a. U.C.C. Rules . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 69 b. Liability for Damages Caused by Removal . . . . . .
. . . . . . . . . . . . . . . . . . . 69 IV. RIGHTS IN THE LAND OF
ANOTHEREASEMENTS, PROFITS, COVENANTS, AND SERVITUDES . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 69 A. IN GENERAL . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 69 B. EASEMENTS
........................................................ 69 1.
Introduction ......................................................
69 a. Types of Easements . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 69 1) Affirmative
Easements . . . . . . . . . . . . . . . . . 2) Negative Easements .
. . . . . . . . . . . . . . . . . . . 2. Easement Appurtenant . . .
. . . . . . . . . . . . . . . . . . 1) Use and Enjoyment . . . . .
. . . . . . . . . . . . . . . 2) Benefit Attached to Possession . .
. . . . . . . . . 3) Transfer of Dominant and Servient Estates 3.
Easement in Gross . . . . . . . . . . . . . . . . . . . . . . . . .
4. Judicial Preference for Easements Appurtenant .
.................... 69 .................... 70
.................... 70 .................... 70
.................... 70 .................... 71
.................... 71 .................... 71
.................... 72 .................... 72 2. Creation of
Easements . . . . . . . . . . . . . . . . . . . . . . . . . .a.
Express Grant . . . . . . . . . . . . . . . . . . . . . . . . . . .
.b. Express Reservation . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 72 c.
Implication................................................... 72
1) Easement Implied from Existing Use (Quasi-Easement) . . . . . .
. . 72 a) Existing Use at Time Tract Divided . . . . . . . . . . .
. . . . . . . . . . . . 72 b) Reasonable Necessity . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 73
REAL PROPERTY ix. c) Grant or Reservation . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 73 2. 2) Easements
Implied Without Any Existing Use . . . . . . . . . . . . . . . . .
. 73 a) Subdivision Plat . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 73 b) Profit a Prendre . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 73 3. 3) Easement by Necessity . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 73 d. Prescription
.................................................. 73 1) Open and
Notorious . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 73 2)
Adverse.................................................. 74 3)
Continuous Use . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 74 4) When Prescriptive Easements
Cannot Be Acquired . . . . . . . . . . . . . . 74 3.
Scope............................................................
74 a. General Rules of Construction . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 74 b. Absence of Location . .
. . . . . . . . . . . . . . ............................ 75 c.
Changes in Use . . . . . . . . . . . . . . . . . . . .
............................ 75 d. Easements by Necessity or
Implication ............................ 75 e. Use of Servient
Estate . . . . . . . . . . . . . . ............................ 75
1) Duty to Repair . . . . . . . . . . . . . . . .
............................ 75 f. Intended
BeneficiariesSubdivision of Dominant Parcel . . . . . . . . . . . .
. 76 g. Effect of Use Outside Scope of Easement . . . . . . . . . .
. . . . . . . . . . . . . . . . . 76 4. Termination of Easements .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 76 a. Stated Conditions . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 b.
Unity of Ownership . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 76 1) Complete Unity
Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 77 2) No Revival . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 c.
Release ...................................................... 77
1) Easement Appurtenant . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 77 2) Easement in Gross . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
78 3) Statute of Frauds . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 78 d.
Abandonment................................................. 78 1)
Physical Act Required . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 78 2) Mere Words Insufficient . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
3) Mere Nonuse Insufficient . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 78 e. Estoppel
..................................................... 79 f.
Prescription .................................................. 79
g. Necessity.....................................................
79 h. Condemnation ................................................
79 i. Destruction of Servient Estate . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 79 5.
CompareLicenses................................................ 80
a. Assignability..................................................
80 b. Revocation and Termination . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 80 1) Public Amusement
Cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 80 2) Breach of Contract . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 80 c. Failure to
Create an Easement . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 80 d. Irrevocable Licenses . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
81 1) Estoppel Theory . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 81 2) License Coupled with
an Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 81 a) Vendee of a Chattel . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 81 b) Termination of Tenancy . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
x. REAL PROPERTY c) Inspection for Waste . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 81 C. PROFITS
............................................................ 81 1.
Creation .........................................................
82 2.
Alienability.......................................................
82 3. Exclusive and Nonexclusive Profits Distinguished . . . . . .
. . . . . . . . . . . . . . . . . 82 4.
Scope............................................................
82 a. Apportionment of Profits Appurtenant . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 82 b. Apportionment of Profits in
Gross . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 82 5. Termination
...................................................... 83 4.
COVENANTS RUNNING WITH THE LAND AT LAW (REAL COVENANTS) . 83 1.
Requirements for Burden to Run . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 83 a.
Intent........................................................ 83
b. Notice .......................................................
83 c. Horizontal Privity . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 83 d. Vertical
Privity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 84 e. Touch and Concern . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 84 1) Negative Covenants . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 84 2) Affirmative
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 85 2. Requirements for Benefit to Run . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 a.
Intent........................................................ 85
b. Vertical Privity . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 85 c. Touch and
Concern . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 86 3. Modern Status of Running of
Burden and Benefit . . . . . . . . . . . . . . . . . . . . . . . 86
a. Horizontal and Vertical Privity . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 86 b. Touch and Concern . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 86 4. Specific Situations Involving Real Covenants . .
. . . . . . . . . . . . . . . . . . . . . . . . . 87 a. Promises to
Pay Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 87 b. Covenants Not to Compete . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
c. Racially Restrictive Covenants . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 87 5.
RemediesDamages............................................... 87
6. Termination
...................................................... 87 5.
EQUITABLE SERVITUDES . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 87 1. Creation
......................................................... 87 a.
Servitudes Implied from Common Scheme . . . . . . . . . . . . . . .
. . . . . . . . . . 88 1) Common Scheme . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 2)
Notice ................................................... 88 2.
Enforcement......................................................
88 1. Requirements for Burden to Run . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 89 1)
Intent.................................................... 89 2)
Notice ................................................... 89 3)
Touch and Concern . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 89 2. Requirements for Benefit to Run
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
89 3. Privity Not Required . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 89 4. Implied
Beneficiaries of CovenantsGeneral Scheme . . . . . . . . . . . . .
. . 89 3. Equitable Defenses to Enforcement . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 90 a. Unclean Hands .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 90 b.
Acquiescence.................................................. 90
c. Estoppel .....................................................
90
REAL PROPERTY xi. d. Changed Neighborhood Conditions . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 91 1)
Zoning................................................... 91 2)
Concept of the Entering Wedge . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 91 4. Termination
...................................................... 91 6.
RELATIONSHIP OF COVENANTS TO ZONING ORDINANCES . . . . . . . . . .
. 91 7. PARTY WALLS AND COMMON DRIVEWAYS . . . . . . . . . . . . .
. . . . . . . . . . . . . . 92 1. Creation
......................................................... 92 2.
Running of Covenants . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 92 V. ADVERSE
POSSESSION . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 92 A. IN GENERAL . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 92 B. REQUIREMENTS
.................................................... 92 1. Running
of Statute . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 92 2. Actual and
Exclusive Possession . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 93 1. Actual Possession Gives Notice
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 93 1) Constructive Possession of Part . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 93 2. Exclusive PossessionNo
Sharing with Owner . . . . . . . . . . . . . . . . . . . . . 93 3.
Open and Notorious Possession . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 93 4.
Hostile...........................................................
93 a. If Possession Starts PermissivelyMust Communicate Hostility .
. . . . . . 93 b. Co-TenantsOuster Required . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 94 c. If Grantor
Stays in PossessionPermission Presumed . . . . . . . . . . . . . .
. 94 d. CompareBoundary Line Agreements . . . . . . . . . . . . . .
. . . . . . . . . . . . . 94 1) Establishment Requirement . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 5.
Continuous Possession . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 94 a. Intermittent
Periods of Occupancy Not Sufficient . . . . . . . . . . . . . . . .
. . . 94 b. Tacking Permitted . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 94 1)
Privity................................................. 95 2)
Formalities on Transfer . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 95 6. Payment of Property Taxes
Generally Not Required . . . . . . . . . . . . . . . . . . . . . 95
C. DISABILITY
......................................................... 95 1.
Effect of DisabilitiesStatute Does Not Begin to Run . . . . . . . .
. . . . . . . . . . . . 95 2. No Tacking of Disabilities . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 95 3. Maximum Tolling Periods . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 96 D. ADVERSE
POSSESSION AND FUTURE INTERESTS . . . . . . . . . . . . . . . . . .
. . . 96 1. Possibility of ReverterStatute of Limitations Runs on
Happening of Event . 96 2. Right of EntryHappening of Event Does
Not Trigger Statute of
Limitations.......................................................
96 a. Grantor Must Act Within Reasonable Time to Avoid Laches . . .
. . . . . . . 96 E. EFFECT OF COVENANTS IN TRUE OWNERS DEED . . . .
. . . . . . . . . . . . . . . . 97 F. LAND THAT CANNOT BE ADVERSELY
POSSESSED . . . . . . . . . . . . . . . . . . . . 97 VI.
CONVEYANCING
........................................................ 97 A. LAND
SALE CONTRACTS . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 97 1. Statute of Frauds
Applicable . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 97 a. Doctrine of Part Performance . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 1)
Theories to Support the Doctrine . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 97 a) Evidentiary Theory . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 97
xii. REAL PROPERTY b) Hardship or Estoppel Theory . . . . . . .
. . . . . . . . . . . . . . . . . . . . 2. 2) Acts of Part
Performance .................................. 3. 3) Can Seller
Obtain Specific Performance Based on Buyers Acts? . . a)
Evidentiary Theory . .................................. b) Hardship
or Estoppel Theory . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 97 . 98 . 98 . 98 . 98 . 98 . 98 . 98 . 99 . 99 . 99 . 99 .
99 . 99 100 100 100 100 101 101 101 101 101 101 101 101 102 102 102
102 102 102 102 102 103 103 103 103 103 103 103 103 103 104 104 104
104 104 2. Doctrine of Equitable Conversion . 1. Risk of Loss . . .
. . . . . . . . . . . . 1) Casualty Insurance . . . . . 2. Passage
of Title on Death . . . . 1) Death of Seller . . . . . . . . . 2)
Death of Buyer . . . . . . . . . ..................................
..................................
..................................
..................................
..................................
.................................. 3. Marketable Title . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 1. Marketability DefinedTitle Reasonably Free
from Doubt . . . . . . . . 1. 1) Defects in Record Chain of Title .
. . . . . . . . . . . . . . . . . . . . . . . . . . . a) Adverse
Possession . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . b) Future Interest Held by Unborn or Unascertained
Parties . . . 2. 2) Encumbrances
........................................... a) Mortgages and Liens
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b) Easements........................................... c)
Covenants........................................... d)
Encroachments....................................... 3. 3) Zoning
Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 4)
Waiver.................................................. 2.
Quitclaim DeedNo Effect . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 3. Time of Marketability . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1) Installment Land Contract . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 4. Remedy If Title Not Marketable . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1)
Rescission, Damages, Specific Performance . . . . . . . . . . . . .
. . . . . . 2) Merger
................................................. 4. Time of
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . a. PresumptionTime Not of the
Essence. . . . . . . . . . . . . . . . . . . . . . . . . . . b.
When Presumption Overcome . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . c. Effect of Time of the Essence
Construction . . . . . . . . . . . . . . . . . . . . . . . . d.
Liability When Time Not of the Essence . . . . . . . . . . . . . .
. . . . . . . . . . . . 5. Tender of Performance . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. a. When Partys Tender Excused . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . b. Neither Party Tenders
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. c. Buyer Finds Sellers Title Unmarketable . . . . . . . . . . . .
. . . . . . . . . . . . . . 6. Remedies for Breach of the Sales
Contract 1. Damages . . . . . . . . . . . . . . . . . . . . . . . .
1) Liquidated Damages . . . . . . . . . . 2. Specific Performance .
. . . . . . . . . . . . . 1) Buyers Remedy . . . . . . . . . . . .
. . 2) Sellers Remedy . . . . . . . . . . . . . . 3. Special Rules
for Unmarketable Title 7. Sellers Liability for Defects on Property
. . a. Warranty of Fitness or QualityNew b. Negligence of Builder .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . ...........................
............................ ............................
............................ ............................
............................ ............................
Construction Only . . . . . . . . . . .
............................
REAL PROPERTY xiii. c. Liability for Sale of Existing Land and
Buildings . . 1) Misrepresentation (Fraud) . . . . . . . . . . . .
. . . . 2) Active Concealment . . . . . . . . . . . . . . . . . . .
. . . 3) Failure to Disclose . . . . . . . . . . . . . . . . . . .
. . . . d. Disclaimers of Liability . . . . . . . . . . . . . . . .
. . . . . . . 1) As Is Clauses . . . . . . . . . . . . . . . . . .
. . . . . . . . 2) Specific Disclaimers . . . . . . . . . . . . . .
. . . . . . . . 8. Real Estate Brokers . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . ................. 104
................. 104 ................. 104 ................. 105
................. 105 ................. 105 ................. 105
................. 105 ................. 105 9. Title Insurance . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.
DEEDSFORM AND CONTENT . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 105 1. Formalities
...................................................... 106 a.
Statute of Frauds . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 106 b. Description of Land
and Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 106 c. Words of Intent . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 d.
Consideration Not Required . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 106 e. Seal Is Unnecessary . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 106 f. Attestation and Acknowledgment Generally
Unnecessary . . . . . . . . . . . . 106 g.
Signature.................................................... 106
2. Defective Deeds and Fraudulent Conveyances . . . . . . . . . . .
. . . . . . . . . . . . . . 107 1. Void and Voidable Deeds . . . .
. . . . . . . . . . . . . . . . . . . 1) Void Deeds . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 2) Voidable Deeds . . .
. . . . . . . . . . . . . . . . . . . . . . . . 2. Fraudulent
Conveyances . . . . . . . . . . . . . . . . . . . . . . . 3.
Description of Land Conveyed . . . . . . . . . . . . . . . . . . .
. . . a. Sufficient Description Provides a Good Lead . . . . . . b.
Insufficient DescriptionTitle Remains in Grantor c. Parol Evidence
Admissible to Clear Up Ambiguity . 1) CompareInadequate Description
. . . . . . . . . . d. Rules of Construction . . . . . . . . . . .
. . . . . . . . . . . . . . ...... ...... ...... ...... ......
...... ...... ...... ...... ...... .......... 107 .......... 107
.......... 107 .......... 107 .......... 107 .......... 107
.......... 107 .......... 108 .......... 108 .......... 108
.......... 108 .......... 108 .......... 109 .......... 109
.......... 109 .......... 109 e. Land Bounded by Right-of-Way . . .
. . . . . . . . . . . . . . . . . . . . 1. 1) Title Presumed to
Extend to Center of Right-of-Way . . a) Evidence to Rebut
Presumption . . . . . . . . . . . . . . . b) Measuring from
Monument . . . . . . . . . . . . . . . . . . 2. 2) Variable
Boundary Line Cases . . . . . . . . . . . . . . . . . . . . a) Slow
Change in Course Changes Property Rightsb) Avulsion Does Not Change
Property Rights . . . . . . . . . . . . . . . 109 c) Encroachment
of Water Does Not Change Fixed Boundary Lines
............................................... 109 f. Reformation
of Deeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 110 C. DELIVERY AND ACCEPTANCE . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
1. DeliveryIn General . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 110 a. Manual Delivery
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 110 b. Presumptions Relating to Delivery . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 c.
Delivery Cannot Be Canceled . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 111 d. Parol Evidence . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 111 1) Admissible to Prove Grantors Intent . . . . . . .
. . . . . . . . . . . . . . . . . 111 2) Not Admissible to Show
Delivery to Grantee Was Conditional . . . . 111 3) Admissible to
Show No Delivery Intended . . . . . . . . . . . . . . . . . . . . .
111
xiv. REAL PROPERTY 1. a) Deed Intended as Mortgage . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 111 2. b) Transfer of
Deed to Bona Fide Purchaser . . . . . . . . . . . . . . . . . 111
(1) Estoppel in Favor of Innocent Purchaser . . . . . . . . . . . .
. 112 4) Comment ...............................................
112 2. Retention of Interest by Grantor or Conditional Delivery . .
. . . . . . . . . . . . . . 112 a. No DeliveryTitle Does Not Pass .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 b.
No RecordingTitle Passes . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 112 c. Express Condition of Death of
Grantor Creates Future Interest . . . . . . 112 d. Conditions Not
Contained in Deed . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 112 e. TestRelinquishment of Control . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 113 3. Where Grantor
Gives Deed to Third Party . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 113 a. Transfer to Third Party with No Conditions . .
. . . . . . . . . . . . . . . . . . . . 113 b. Transfer to Third
Party with Conditions (Commercial Transaction) . . 113 1) Parol
Evidence Admissible to Show Conditions . . . . . . . . . . . . . .
. . 113 2) Grantors Right to Recover Deed . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 113 a) Majority ViewCan Recover Only
If No Written Contract . . 114 b) Minority ViewNo Right to Recover
. . . . . . . . . . . . . . . . . . . . 114 3) Breach of Escrow
ConditionsTitle Does Not Pass . . . . . . . . . . . . . 114 a)
Estoppel Cases . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 114 4) Relation-Back Doctrine . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 a)
Not Applied If Intervening Party Is BFP or Mortgagee . . . . . .
115 b) Not Applied in Favor of Escrow Grantee with Knowledge . . .
. 115 c. Transfer to Third Party with Conditions (Donative
Transactions) . . . . 115 1) Condition Unrelated to Grantors Death
. . . . . . . . . . . . . . . . . . . . . . 115 2) Where Condition
Is Grantors Death . . . . . . . . . . . . . . . . . . . . . . . . .
115 a) LimitationNo Delivery If Conditioned on Survival . . . . . .
. . 115 4. Acceptance
...................................................... 115 a.
Usually Presumed . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 115 b. Usually Relates Back .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 116 5.
Dedication.......................................................
116 D. COVENANTS FOR TITLE AND ESTOPPEL BY DEED . . . . . . . . . .
. . . . . . . . . 116 1. Covenants for Title in a General Warranty
Deed . . . . . . . . . . . . . . . . . . . . . . . 116 a. Usual
Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 1)
Covenant of Seisin . . . . . . . . . . . . . . . . ... 2) Covenant
of Right to Convey . . . . . . . ... 3) Covenant Against
Encumbrances . . . . ... 4) Covenant for Quiet Enjoyment . . . . .
. ... 5) Covenant of Warranty . . . . . . . . . . . . . ... 6)
Covenant for Further Assurances . . . ... 7) No Implied Warranties
or Covenants ... ..................... 116 .....................
116 ..................... 116 ..................... 117
..................... 117 ..................... 117
..................... 117 ..................... 117
..................... 117 ..................... 117 b. Breach of
Covenants . . . . . . . . . . . . . . . . . . . . .1) Covenants of
Seisin and Right to Convey2) Covenant Against Encumbrances . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 118 3) Covenants
for Quiet Enjoyment, Warranty, and Further Assurances
.............................................. 118 a) Covenant Runs
to Successive Grantees . . . . . . . . . . . . . . . . . . . 118 b)
Requirement of Notice . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 118 c) Any Disturbance of Possession . . . . .
. . . . . . . . . . . . . . . . . . . . . 118
REAL PROPERTY xv. c. Damages and Remote Grantees . . . . . . . .
. . . . . 2. Statutory Special Warranty Deed . . . . . . . . . . .
. . . . 3. Quitclaim Deeds . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 4. Estoppel by Deed . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . a. Applies to Warranty Deeds . . . .
. . . . . . . . . . . . . b. Rights of Subsequent Purchasers . . .
. . . . . . . . . 1) Effect of Recordation by Original Grantee
.................... 118 .................... 119
.................... 119 . . . . . . . . . . .. . . . . . . . . 119
.................... 119 .................... 119
.................... 120 c. Remedies of Grantee . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
E. RECORDING
....................................................... 120 1.
Recording ActsIn General . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 120 a. Purpose of
RecordationNotice . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 120 b. Requirements for Recordation . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 120 1. 1) What
Can Be RecordedInstrument Affecting an Interest inLand
................................................... 120 2. 2)
Grantor Must Acknowledge Deed . . . . . . . . . . . . . . . . . . .
. . . . . . . . 120 c. Mechanics of Recording . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 1)
Filing Copy . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 121 2) Indexing
................................................ 121 2. Types of
Recording Acts . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 121 a. Notice Statutes . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 121 b. Race-Notice Statutes . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 c.
Race Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 122 3. Who Is Protected
by Recording Acts . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 122 1. Purchasers
.................................................. 123 1) Donees,
Heirs, and Devisees Not Protected . . . . . . . . . . . . . . . . .
. . . 123 2) Purchaser from Donee, Heir, or Devisee . . . . . . . .
. . . . . . . . . . . . . . 123 3)
Mortgagees.............................................. 123 4)
Judgment Creditors . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 123 5) Transferees from Bona Fide
PurchaserShelter Rule . . . . . . . . . . 124 a)
Rationale............................................ 124 b)
ExceptionNo Shipping Through . . . . . . . . . . . . . . . . . . .
. . 124 6) Purchaser Under Installment Land Contract . . . . . . .
. . . . . . . . . . . 124 a) ExceptionShelter Rule . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 125 2. Without Notice
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 125 1) Actual Notice . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
125 2) Record NoticeChain of Title . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 125 a) Wild Deeds . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125 b)
Deeds Recorded Late . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 126 (1) ExceptionShelter Rule . . . . . . . . .
. . . . . . . . . . . . . . . . . . 126 (2) Lis Pendens Protection
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 126 c)
Deeds Recorded Before Grantor Obtained Title. . . . . . . . . . . .
126 d) Deed in Chain Referring to Instrument Outside Chain . . . .
. . 127 e) Restrictive CovenantsDeeds from Common Grantor . . . . .
. 127 (1) Subdivision Restrictions . . . . . . . . . . . . . . . .
. . . . . . . . . . . 127 (2) Adjacent Lots . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 128 f) Marketable
Title Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 128 3) Inquiry Notice . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 128 a) Generally
No Inquiry from Quitclaim Deed . . . . . . . . . . . . . . .
128
xvi. REAL PROPERTY VII. 2. b) Inquiry from References in
Recorded Instruments . . . . . . . . . 128 3. c) Inquiry from
Unrecorded Instruments in Chain of Title . . . . . 128 4. d)
Inquiry from Possession . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 129 c. Valuable Consideration . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129 1)
TestSubstantial Pecuniary Value . . . . . . . . . . . . . . . . . .
. . . . . . . . 129 2) Property Received as Security for Antecedent
Debts Is Insufficient
.............................................. 129 4. Title Search
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 129 a. Tract Index Search . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 129 b. Grantor and Grantee Index Search . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 130 c. Other
Instruments and Events Affecting Title . . . . . . . . . . . . . .
. . . . . . . 131 5. Effect of Recordation . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
131 a. Does Not Validate Invalid Deed . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 131 b. Does Not Protect Against
Interests Arising by Operation of Law . . . . . . 131 1) Exception
............................................... 131 c. Recorders
Mistakes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 132 d. Effect of Recording Unacknowledged
Instrument . . . . . . . . . . . . . . . . . . 132 1) No
AcknowledgmentNo Constructive Notice . . . . . . . . . . . . . . .
. . 132 2) CompareDefective Acknowledgment . . . . . . . . . . . .
. . . . . . . . . . . 132 6. CONVEYANCE BY WILL . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
132 1. Ademption
...................................................... 132 a. Not
Applicable to General Devises . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . 133 b. Not Applicable to Land Under
Executory Contract . . . . . . . . . . . . . . . . . 133 1) No
Ademption If Decedent Incompetent When Contract Formed . 133 c.
Other Proceeds Not Subject to Ademption . . . . . . . . . . . . . .
. . . . . . . . . . 133 d. Partial Ademption . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
133 2. Exoneration
..................................................... 133 3. Lapse
and Anti-Lapse Statutes . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 134 1. Degree of Relationship to
Testator . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 134 1) Descendants Are Substituted . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 134 2. Inapplicable If
Beneficiary Dead When Will Executed . . . . . . . . . . . . . . 134
3. Application to Class Gifts . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 134 4. Anti-Lapse Statute
Does Not Apply If Contrary Will Provision . . . . . . . 134 4.
Abatement.......................................................
134 7. CROPS (EMBLEMENTS) . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 135 1. Conveyance
of Land Includes Crops . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 135 2. ExceptionHarvested Crops . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
a. Ripened But Unharvested Crops . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 135 3. ExceptionCrops Planted by
Tenant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 135 a.
CompareTrespasser......................................... 135
SECURITY INTERESTS IN REAL ESTATE. . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 135 A. TYPES OF SECURITY INTERESTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 135 1.
Mortgage........................................................
136 2. Deed of Trust . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 3.
Installment Land Contract . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 136 4. Absolute
DeedEquitable Mortgage . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 136 5.
Sale-Leaseback...................................................
136
REAL PROPERTY xvii. B. TRANSFERS BY MORTGAGEE AND MORTGAGOR
................... 1. Transfer by Mortgagee . . . . . . . . . . .
. . . . . . . . . . . . . ................... a. Transfer of
Mortgage Without Note. . . . . . . . . . ................... b.
Transfer of Note Without Mortgage. . . . . . . . . .
................... 1. 1) Methods of Transferring the Note . . . .
. . . ................... a) Holder in Due Course Status . . . . .
. . . . . . . . . . . . . . . . . . . . . b) Benefits of Holder in
Due Course Status . . . . . . . . . . . . . . . . . 2. 2) Effect of
Payment to Original Mortgagee After Transfer of Note . . 136 . 137
. 137 . 137 . 137 . 137 . 137 . 138 2. Transfer by MortgagorGrantee
Takes Subject to Mortgage . . . . . . . . . . . . 138 a.
Assumption.................................................. 138 b.
Nonassuming Grantee . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . 138 c. Due-on-Sale Clauses . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 138 C. DEFENSES AND DISCHARGE OF THE MORTGAGE . . . . . .
. . . . . . . . . . . . . . 139 1. Defenses to Underlying
Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 139 2. Discharge of the Mortgage . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
a. Payment .................................................... 139
b. Merger ..................................................... 139
c. Deed in Lieu of Foreclosure . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . 139 D. POSSESSION BEFORE
FORECLOSURE 1. Theories of Title . . . . . . . . . . . . . . . . .
. . a. The Lien Theory . . . . . . . . . . . . . . b. The Title
Theory . . . . . . . . . . . . . . c. The Intermediate Theory . . .
. . . . 2. Mortgagor Consent and Abandonment
............................... 139 ...............................
139 ............................... 140
............................... 140 ...............................
140 ............................... 140 3. Risks of Mortgagee in
Possession . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . 140 4. Receiverships
.................................................... 140 E.
FORECLOSURE.....................................................
140 1.
Redemption......................................................
140 a. Redemption in Equity . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . 141 b. Statutory
Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 141 2.
Priorities........................................................
141 a. Effect of Foreclosure on Various Interests . . . . . . . . .
. . . . . . . . . . . . . . . . 141 1) Junior Interests Destroyed
by Foreclosure 2) Senior Interests Not Affected . . . . . . . . . .
. b. Modification of Priority . . . . . . . . . . . . . . . . . . .
. 1) Failure to Record . . . . . . . . . . . . . . . . . . . . . 2)
Subordination Agreement . . . . . . . . . . . . . . 3) Purchase
Money Mortgages . . . . . . . . . . . . .................... 141
.................... 141 .................... 141
.................... 141 .................... 142
.................... 142 a) Vendor PMM vs. Third-Party PMM . . . .
. . . . . . . . . . . . . . . . . 142 b) Third-Party PMM vs.
Third-Party PMM . . . . . . . . . . . . . . . . . 142 4)
Modification of Senior Mortgage . . . . . . . . . . . . . . . . . .
. . . . . . . . . . 143 5) Optional Future Advances . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . 143 3. Proceeds
of Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 143 4. Deficiency Judgments
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . 143 F. INSTALLMENT LAND CONTRACTS . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 145 1.
Equity of Redemption . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 145 2. Restitution
...................................................... 145 3. Treat
as a Mortgage. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 145
xviii. REAL PROPERTY 4.
Waiver..........................................................
145 5. Election of Remedies . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 145 VIII.
RIGHTS INCIDENTAL TO OWNERSHIP OF LAND (NATURAL RIGHTS) . . . . .
145 A. IN GENERAL . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145 B.
RIGHT TO LATERAL AND SUBJACENT SUPPORT OF LAND 1. Right to Lateral
Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . a. Support of Land in Natural State . . . . . . . . . . . . . .
. . . . . . . b. Support of Buildings on Land. . . . . . . . . . .
. . . . . . . . . . . . . 2. Right to Subjacent Support . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . a. Support of Land
and Buildings . . . . . . . . . . . . . . . . . . . . . . b.
Interference with Underground Waters . . . . . . . . . . . . . . .
. ........... 145 ........... 146 ........... 146 ........... 146
........... 146 ........... 146 ........... 146 C. WATER RIGHTS . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 146 1. Watercourses
.................................................... 146 a.
Riparian Doctrine . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 147 1) What Land Is Riparian
. . . . . ............................... 147 a) Riparian Owner . .
. . . . . ............................... 147 b) Doctrine Applies
Only to Riparian Parcel . . . . . . . . . . . . . . . . . 147 2)
Nature of Riparian Right . . . a) Natural Flow Theory . . . b)
Reasonable Use Theory . (1) Factors to Consider c) Natural vs.
Artificial Use b. Prior Appropriation Doctrine . . . . 1) Factors
to Note for Bar Exam ............................... 147
............................... 147 ...............................
147 ............................... 147
............................... 148 ...............................
148 ............................... 148 c. Accretion and Avulsion .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . 148 2. Groundwater
.................................................... 148 a.
Absolute Ownership Doctrine . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 149 b. Reasonable Use Doctrine . . .
. . c. Correlative Rights Doctrine . . d. Appropriative Rights
Doctrine e. Restatement Approach . . . . . . 3. Surface Waters . .
. . . . . . . . . . . . . . .a. Natural Flow Theory . . . . . . .
.b. Common Enemy Theory . . . . .c. Reasonable Use Theory . . . . .
.d. CompareCapture of Surface Water ............................
149 ............................ 149 ............................
149 ............................ 149 ............................
149 ............................ 149 ............................
150 ............................ 150 ............................
150 D. RIGHTS IN AIRSPACE . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 150 E. RIGHT TO
EXCLUDEREMEDIES OF POSSESSOR . . . . . . . . . . . . . . . . . . .
150 1. Trespass
........................................................ 150 2.
Private Nuisance . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 150 a.
ComparePublic Nuisance . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . 150 3. Continuing Trespass . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . 150 4. Law or Equity . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 150 a. Ejectment
................................................... 150 b. Unlawful
Detainer . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . 151 IX. COOPERATIVES, CONDOMINIUMS,
AND ZONING . . . . . . . . . . . . . . . . . . . . . . . . 151
...... ...... ...... ...... ...... ...... ...... ......
REAL PROPERTY xix. 1.
COOPERATIVES....................................................
151 1. Restriction on Transfer of Interests . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 151 2.
Mortgages.......................................................
151 3. Maintenance Expenses . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 151 2.
CONDOMINIUMS................................................... 151
1. Restriction on Transfer of Interests . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 151 2.
Mortgages.......................................................
151 3. Maintenance Expenses . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 152 3.
ZONING............................................................
152 1. Nonconforming Use . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 152 2. Special
Use Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . 152 3. Variance
........................................................ 152 4.
Unconstitutional Takings and Exactions . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 152 a. Denial of All Economic Value
of LandTaking . . . . . . .............. 152 b. Denial of Nearly
All Economic ValueBalancing Test .............. 152 c.
Unconstitutional Exactions . . . . . . . . . . . . . . . . . . . .
. . . . ............. 153 1) Essential Nexus . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .............. 153 2) Rough
Proportionality . . . . . . . . . . . . . . . . . . . . . . .
.............. 153 3) Burden of Proof . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 153 d.
Remedy..................................................... 153
REAL PROPERTY 1. A. IN GENERAL I. ESTATES IN LAND Estates in
land are possessory interests in land. These interests may be
presently posses- sory (present estates), or they may become
possessory in the future (future interests). They may be freeholds,
which give possession under some legal title or right to hold
(e.g., fees or life estates), or they may be nonfreeholds, which
give mere possession (i.e., leases). Estatesin land may be of
potentially infinite duration, as in the case of a fee simple, or
they may beof limited duration, as in the case of an estate for
years. But whatever their characteristics, estates in land must be
distinguished from nonpossessory interests such as easements,
profits, covenants, and servitudes. This section of the outline
will examine various estates in land. It divides the interests into
two classes: present interests and future interests. However, some
future interests (those following defeasible fees) will be
considered with the present interests to which they are attached.
B. PRESENT POSSESSORY ESTATES 1. Fee Simple Absolute An estate in
fee simple absolute is the largest estate permitted by law. It
invests the holder of the fee with full possessory rights, now and
in the future. The holder can sell it, divide it, or devise it; and
if she dies intestate, her heirs will inherit it. The fee simple
has an indefinite and potentially infinite duration. The common law
rule requiring technical words of inheri- tance (and his heirs) has
been abolished by statute in nearly all jurisdictions. Typically,
such statutes provide: A fee simple title is presumed to be
intended to pass by a grant of real property unless it appears from
the grant that a lesser estate was intended. Example: A conveyance
from O to A is presumed to pass a fee simple interest if O owned
one. At common law, absent the words of inheritance, even a convey-
ance to A in fee simple would convey only a life estate to A. 2.
Defeasible Fees Defeasible fees are fee simple estates of
potentially infinite duration that can be terminated by the
happening of a specified event. Because defeasible fees can result
in forfeitures, courts will construe, where possible, a purported
limitation as a mere declaration of the grantors purpose or motive
for making the grant (i.e., as precatory language). (See b.1)a),
infra.) a. Fee Simple Determinable (and Possibility of Reverter) A
fee simple determinable, also called a determinable fee, is an
estate that automati- cally terminates on the happening of a stated
event and goes back to the grantor. (It must be distinguished from
the fee simple subject to a condition subsequent, where the grantor
must take affirmative steps to terminate the estate of the grantee
if the stated event occurs.) It is created by the use of
durational, adverbial language, such as for so long as, while,
during, or until. A fee simple determinable can be conveyed by the
owner thereof, but his grantee takes the land subject to the
termination of the estate by the happening of the event. Example: O
conveys land to A for so long as no alcoholic beverages are
consumed on the premises. This gives A a fee simple because the
estate may last forever if no one ever quaffs a brew. If A conveys
his fee simple 2. REAL PROPERTY determinable estate to B, B will
own the for so long as estate. If A does not convey his estate, on
As death it will pass by will or intestacy to his successors, and
so on. If, however, someone ever consumes an alcoholic beverage on
the premises, the estate will automatically come to an end
according to its own terms; and O will immediately and automat-
ically become the owner of the fee simple, without taking any steps
to terminate As interest. 1. 1) Correlative Future Interest in
GrantorPossibility of Reverter Because the grantees estate may end
upon the happening of the stated event, there is a possibility that
the land may revert back to the grantor. The interest that is left
in a grantor who conveys an estate in fee simple determinable is
called a possi- bility of reverter. It is a future interest because
it becomes possessory only upon the occurrence of the stated event.
1. a) Possibility of Reverter Need Not Be Expressly Retained At
common law and in nearly all states today, the grantor does not
have to expressly retain a possibility of reverter. It arises
automatically in the grantor as a consequence of his conveying a
fee simple determinable estate, with its built-in time limitation.
2. b) Transferability of Possibility of Reverter At early common
law, the possibility of reverter could not be transferred inter
vivos or devised by will. An attempted transfer of the interest was
invalid; but the possibility of reverter was not extinguished by
the attempted transfer and would still descend to the heirs of the
owner. Today, in most jurisdictions, the possibility of reverter
can be transferred inter vivos or devised by will, and descends to
the owners heirs if she dies intestate. 2. 2) Correlative Future
Interest in Third PartyExecutory Interest A possibility of reverter
arises only in the grantor, not in a third party. If a compa- rable
interest is created in a third party, it is an executory interest.
(See C.3., infra.) b. Fee Simple Subject to Condition Subsequent
(and Right of Entry) A fee simple subject to a condition subsequent
is created when the grantor retains the power to terminate the
estate of the grantee upon the happening of a specified event. Upon
the happening of the event stated in the conveyance, the estate of
the grantee continues until the grantor exercises her power of
termination (right of entry) by bringing suit or making reentry.
The following words are usually held to create condi- tions
subsequent: upon condition that, provided that, but if, and if it
happens that. Example: O, owning Blackacre in fee simple, conveys
it to A and his heirs, on the express condition that the premises
are never to be used by A for the sale of liquor, and in the event
that they are so used, then O or her heirs may enter and terminate
the estate hereby conveyed. A has a fee simple subject to a
condition subsequent. O has a right of entry. If the condition is
broken, O has a power to terminate the estate of A by asserting her
right of entry. REAL PROPERTY 3. 1) Correlative Future Interest in
GrantorRight of Entry A right of entry (also known as right of
reentry or power of termination) is the future interest retained by
the transferor who conveys an estate on condition subsequent. It is
necessary to expressly reserve the right of entry in the grantor;
this retained interest does not automatically arise as in the case
of a fee simple determinable and possibility of reverter. a)
Failure to Reserve Right of Entry Courts often hold that words of
condition, standing alone, create only covenants, easements, or
trusts, or are mere precatory terms. Example: O conveys land to A
and his heirs, provided that liquor is not sold on the premises. O
has not used words indicating the estate will terminate if liquor
is sold on the premises. Nor has O retained a right to reenter.
Because a statement of the grantors wishes as to how the property
should be used does not ordinarily imply a right retained by the
grantor to enforce the purpose, a court may construe the deed as
giving A a fee simple absolute. [Wood v. Board of County
Commissioners, 759 P.2d 1250 (Wyo. 1988)] b) Waiver of Right of
Entry Because the grantor can elect whether or not to terminate the
grantees estate, she may waive her right or power to enforce a
forfeiture by express agreement or by her conduct. (Such is not the
case with a fee simple determinable, where the forfeiture is
automatic.) (1) Inaction by Itself Not a Waiver The general rule is
that when there is a breach of the condition and the grantor simply
does nothing about it, the power of termination is not waived.
However, where there is any element of detrimental reliance by the
fee holder, many courts treat inaction as a waiver on an estoppel
or laches theory. c) Transferability of Right of Entry At common
law, a right of entry was not devisable or transferable inter vivos
to a third person. The right of entry did, however, descend to the
heirs of the grantor on her death. Today, in most jurisdictions, a
right of entry is still not alienable inter vivos. (Indeed, in a
handful of states, an attempted transfer destroys it.) But in most
states, rights of entry are devisable; and in all states, they
descend to the owners heirs. 2. 2) Correlative Future Interest in
Third PartyExecutory Interest A right of entry can be created only
in favor of the grantor and her heirs. If a similar interest is
created in favor of a third party, the interest is called an execu-
tory interest (e.g., if the property is ever used for other than
church purposes, then to B and his heirs). Unlike a right of entry,
an executory interest is subject to the Rule Against Perpetuities.
(See E., infra.) 3. 3) CompareFee Simple Determinable This estate
is distinguished from a determinable fee in that the breach of the
4. REAL PROPERTY condition does not itself terminate the estate and
immediately revest the fee in the grantor or her successor. The
estate continues in the grantee or his successor unless or until
the grantor or her successor affirmatively elects to terminate it.
a) Construction of Ambiguous Language The general policy of courts
is to avoid forfeiture of estates. Thus, a convey- ance that
contains both durational language and a power of termination may be
construed as creating a fee simple subject to a condition subse-
quent, because the forfeiture is optional at the grantors election
rather than automatic. Example: O conveys land to A so long as
liquor is not sold on the premises, and if liquor is sold, O has a
right to reenter. The words so long as point to a fee simple
determinable. The retained right of entry points to a fee simple
subject to a condi- tion subsequent. The court can classify the
language to create either estate, but the fee simple subject to a
condition subse- quent is preferred. c. Fee Simple Subject to an
Executory Interest A fee simple subject to an executory interest is
an estate that, upon the happening of a stated event, is
automatically divested in favor of a third person rather than the
grantor. Examples: 1) O conveys land to Church; provided, however,
that if the premises shall ever cease to be used for church
purposes, title shall pass to the American Heart Association.
Church has a fee simple subject to an executory interest in favor
of the Heart Association. O does not havea right of entry because
no such interest was reserved in the convey- ance. T