Brokerage Real Estate Chapter 2 Unit 1-3

JJill buys a house from Jack. She assumed that the curtains would be included in the price, even though they were not listed in the agreement of sale. What is the best argument Jill could make to persuade a judge if this goes to court?

"The curtains were custom-made for the odd-shaped window.: Jill's best argument is that the curtains were custom-made.

Check in #5: You live in a house on the shores of a commercial lake. You are a Littoral owner, which means that you don't own the land under the water.

(You are a littoral owner since your house is on the shores of a commercial lake. You own the land to the high-water mark and not the land under the water. Plus, you can't keep people from walking along the beach.)

fixtures can become real property by one of several other methods:

- Becoming attached conceptually because of a close association with real property (such as the keys to a house) - Becoming attached through the process of adoption; for example, curtains that were custom-made for an unusual window size or shape or even wall-to-wall carpeting - Becoming part of the real property through agreement between the parties involved (such as a landlord and a tenant) Becoming part of the property because its removal would damage the property -Become part of the property because of the intention of the person affixing the personalty to the real estate

Rights of Riparian and Littoral owners have the right to

- Make reasonable use of the water surface. Keep in mind this isn't the same as owning the water. - Take water for domestic uses, such as drinking or washing, and possibly irrigation rights for use on their riparian or littoral land. - Use the water for recreational purposes.

freehold estate include

- The transfer of the property to someone else (i.e., the sale of property). - The death of the owner. - Foreclosure on the property for non-payment of debt. - Confiscation of a taxpayer's real property in lieu of unpaid taxes (tax-forfeiture). - Condemnation by the government under eminent domain.

Total circumstances test

4-part legal test used by the court to decide whether an item in dispute in a real estate sales transaction is a fixture or personal property. criteria for determining if an item is a fixture. All four parts must be met for the item to be a fixture.

total circumstances test has # of parts and is used how?

4-part legal test, used by the court to decide whether an item in dispute in a real estate sales transaction is a fixture or personal property.

Emblement

A crop that is planted and cultivated through someone's labor and industry. Emblements are considered to be personal property. Also called: Fructus Industriales.

Fee Simple Determinable

A defeasible fee that's terminated automatically if certain conditions occur. The grantor (or his or her heirs) has a possibility of reverter.

Bill of Sale

A document used to transfer ownership of personal property from one person to another.

Fee simple conditional

A fee simple subject to condition subsequent—also called a fee on condition estate—means that a grantor puts a condition or a requirement in the deed that gives the grantor the "right of re-entry" if the condition is broken or the requirement is not met. In this type of estate, the grantor (or the grantor's heirs) may have the right to terminate the estate, but this does not happen automatically. In order to regain title to the property, the grantor would need to prove in court that the condition was broken or that the stated event occurred. For example, David may transfer his land to Frank with a condition in the deed language that states that Frank may not build a bar on the property. If Frank builds a bar, grantor David may go to court to try to regain possession.Similarly, the grantor could also include a condition where the grantor retains title to the estate until a specific condition occurs. This is known as fee simple subject to condition precedent. For example, Bill will transfer title of the property to his grandson Will, if Will marries before his 25th birthday.

Leasehold Improvement

A fixture attached to real property by a landlord for the use of a tenant.

Forces of Nature: Accretion definition

A gradual addition to dry land by the forces of nature, as when the tide deposits water-borne sediment on shoreline property.

Forces of Nature; Erosion definition

A gradual loss of soil due to the action of wind, water, or other forces.

Alienation

A life tenant's right transfers their title to another person or pledges the title as security for a debit.

Fixture- def

A man-made attachment; an item of personal property that has been attached to or closely associated with real property in such a way that it has legally become part of the real property.

Avulsion

A natural process in which land is removed from one person's property and deposited onto another's. It happens very suddenly, as in a flash flood. Think of Illusion

Measuring Life

A person whose life determines the length of a life estate.

Remainderman

A person, other than the grantor, who has a future interest in a life estate. A remainder interest is inheritable.

Encroachment definition

A physical object intruding onto neighboring property, often due to a mistake regarding the boundary.

Supporting Rights

A piece of land is _____________ by the land that surrounds it. A landowner has a right to the natural ____________ provided by land beside and beneath it.

Chattel

A piece of personal property.

Freehold Estate

A possessory interest in real property of uncertain (and often unlimited) duration; an ownership estate in real property; either a fee simple or life estate. The holder of freehold estate has title.

Estate

A possessory interest in real property; either a freehold estate or a leasehold estate

Which of these is a common example of personal property that is included in an agreement of sale?

A refrigerator The chandelier and the pool are real property. While furniture may sometimes sold with a house, it's very common to include appliances.

Defeasible Fee

A type of freehold estate conveying ownership interest that comes with a condition. Also called Qualified Fee.

Improvements.

Additions to real property that are man-made, substantial fixtures, such as buildings.

Bundle of Rights

All real property rights that are conferred with ownership, including right of possession, right of quiet enjoyment, right of disposition, right of exclusion, and right of control.

Bundle of Rights: Disposition

Allows the owner to transfer all or some of the rights to other people.

Estate for the life of another (Pur Autre Vie)

Although most estates of inheritance are fee estates, sometimes an estate may be based on the life of another person rather than on the life of the life tenant. life estate pur autre vie (for another's life in French). With this type of life estate, the measuring life (the other person) and the life tenant are not the same. A life estate "for another's life," where the measuring life is someone other than the life tenant.

Agriculture Fixtures

An item placed on real property for the purposes of agriculture use; in North Carolina these fixtures become a part of the real property once attached and cannot be removed without written agreement from landlord.

Land (Continued)

An owner has rights to the surface of the land within the property's boundaries, plus everything directly over the surface and everything under the land within the pyramid. Also, The surface of the earth; actual dirt on the ground, part of a waterway that is owned, or even a swampy marsh. From a legal standpoint, ______ also refers to everything under the ground to the center of the earth, and everything over the land into the air (within limits to allow for air traffic).

Improvement def

Any addition to or change in a condition of real property to increase its value or utility.

A landowner needs water. His land contains no available water source. However, the landowner is given the right to cross over his next-door neighbor's property to run a pipeline from a river to his land. Which right grants this permission?

Appropriative

Annexation

Attaching personal property to land so that the law views it as part of the real property.

A large mirror that a buyer wants to remain with the property should..

Be identified as a fixture int he sales contract

Revolutionary v. Remainder Life Estates

Both types of life estate (conventional and marital) are a present interest for the life tenant that creates a future interest for the person who will receive and possess the land upon the death of the tenant or of the person who is the measuring life. This future interest may be reversionary or remainder:

Examples of Attachments are

Buildings, pipelines, pavements, sewers, roads, driveways, fences

Which element CANNOT be separated from real property?

Bundle of rights

How to define a parcel of land

By detailing only the surface. The law implies subsurface and air rights are included as part of the land even though they are usually not documented.

Personal Property

Called chattel or personalty. It is anything that is NOT real property, therefore, it is NOT attached to the land and IS movable (although it not necessarily easy to move)

Transfer of real property and its attachments is usually completed with a

Deed

Cynthia is renting a storefront in order to open a hair salon. She hires a plumber to install five hair washing stations in the space. The sinks would be considered fixtures, making them real property.

FALSE: When something is attached to real estate for the benefit of a business, it is a trade fixture, not a fixture.

Check in #7: Reliction is the gradual process of waterborne silt being deposited in a river, lakebed or on a shore.

False

Encroachment refers to a physical intrusion of land by another person without any lawful right to enter it

False

Encroachment refers to a physical intrusion of land by another person without any lawful right to enter it.

False

Manufactured housing is a type of factory-built housing that is automatically considered real property once it is constructed onsite.

False

Ownership of land involves only the surface and the dirt below, NOT the air above it.

False

When comparing freehold estates and nonfreehold estates, nonfreehold estates have a lifetime ownership interest.:

False

Check in #8: If you purchase a home next to an airport and you become annoyed when planes take off from the airport in early morning hours, do you think you may be able to recover damages from the airport for infringing on your air rights?

False/no

Dower and curtesy rights apply in the state of North Carolina.:

False: North Carolina abolished dower and courtesy rights in its intestate succession statutes. However, it provided a substitute manner by which those who die without a valid will can distribute property to the heirs.

Check in # 11: Trees, shrubs, perennials, and naturally occurring vegetation are part of the land and therefore are considered personal property.

False: Reason: Permanent vegetation that is part of the land is included in the definition of real property.

According to the North Carolina Uniform Commercial Code (UCC), any attached item on real property is considered the homeowner's personal property once the property is conveyed.

False: The UCC has numerous provisions when an owner has financed the purchase of a fixture installed on the real property. Attached items are not legally considered a part of the real property until the security agreement has been paid in full.

When Steven sells his house to Lois, the built-in bookcase transfers as part of the transaction.

False: The bookcase is actually a fixture, not an appurtenance. An appurtenance is a right. As a fixture, however, the bookcase should transfer with the sale of the property. Although it seems straightforward, you may find that it could still be the subject of a dispute when he sells that house.

Trees, shrubs, perennials, and naturally occurring vegetation are part of the land and therefore are considered personal property.

False:Permanent vegetation that is part of the land is included in the definition of real property.

Examples of Bundle of Rights: Disposition

For example, landowners normally have the right to sell, lease, give away, divide, and retain part of the land or to dispose of it completely. An example of partial disposition would be someone who sells 10 acres of his 100-acre farm. Another example of partial disposition would be a landlord who rents an apartment, allowing someone else to possess part of the property, even if temporarily. (rob never uses his detached two-car garage, so he rents it as storage.)

Riparian Rights regular and Navigable example

For recreational purposes such as swimming or boating. If the waterway is *navigable*, land ownership rights extend only to the high-water mark or the edge of the water. (The public owns the riverbed and shares the right to use the water)

Which of these is real property?

Frauctus naturales

Manufactured Housing

Houses built to HUD building codes in a factory, titled and regulated by the North Carolina Department of Motor Vehicles (DMV), and is considered personal property until required steps are taken by the owner to convert to real property.

Modular Housing

Houses built to state building codes in a factory (personal property), transported to the landowner's site, and assembled by a builder onsite on a permanent foundation, which at that point becomes real property.

Part 3: Adaption to Real Estate

How it the item being used? This test looks at whether the item custom-made or designed specifically to fit or be used in the property. For example, custom-made blinds can be made to fit nonstandard windows.

Riparian Rights regular and Non-Navigable example

If the waterway is __________, such as a small creek, land ownership rights extend to the center of the waterway. In this case, landowners cannot stop other people from enjoying the water by building a fence or in some other way blocking access to the water simply because they own the land underneath the water.

Martial Life Estates

In North Carolina, marital life estates are created by operation of law when a married person owning real property solely in his or her name dies intestate (without a will) and is survived by a spouse.

Example of Littoral Rights

In the case of tidal waters, owners with littoral rights own the land under the water only up to the mean high-water mark (high tide) and the public/government owns the land beyond that point. What exactly is the high-water mark? According to the U.S. Supreme Court, the high-water mark is the berm of sand that the tide washes up on the shore. The ruling gives the public the right of passage on the land between the high-water mark and the water's edge

Appurtenances Rights

Include bundle of ownership rights, surface, subsurface, air, and water of the property. Examples: Are _______ easements and the benefits of restrictive (protective) covenants, which will be covered elsewhere in this course. A right that goes along with ownership of real property; usually transferred with the property, but may be sold separately. This is a legal term referring to both physical and non-physical _______________..

Which is NOT a legal right of a life tenant?

Income from cut timber: Life tenants also have the right to estovers, which means they can cut a reasonable amount of timber from the land to repair buildings or use it for fuel but does not allow the tenant to cut and sell the timber for profit.

Rights of life tenants

Individuals who are life tenants can transfer their title to another person or pledge the title as security for a debit. This is called the right of alienation.

Trade Fixture

Items of personal property that are annexed to leased property, are necessary to a trade or business, and are removable by the tenant prior to expiration of the lease

Examples of Appurtenances

Jack inherits 75 acres of land and decides to build a house. A previous owner found natural gas on the land and has sold the natural gas rights to the gas company, so Jack doesn't inherit those rights. While the builders are clearing an area for the house, they find coal. Jack moves the location of his home to contract with a company to extract the coal. Later, Jack dies and his son, Phil, inherits the property. Phil doesn't want the property or the house, so he sells the property but keeps the coal rights.

Check in #2: Right of Possession &Quiet Enjoyment Examples.

Jay loves fresh corn, so he plants half of his backyard with corn. Margaret is fond of lawn ornaments and places 20 gnomes in her backyard.

NC Uniform Commercial Code

Let's discuss the effect of the state's: (UCC) (G.S. 25-9-313) concerning security interests in fixtures (personal property attached to the land or real property).

Andrew Dye has two sons. His second wife Carla dotes on their son Bart, but Andrew is fonder of son Doug from his first marriage. Carla urges Andrew to give the Dye family beach house to Bart, but Andrew has a better idea. He conveys a life estate to his younger son Bart for as long as Carla shall live, and then to Doug. What type of estate does this describe?

Life Estate pur autre vie

John owns property on a small pond, which gives him

Littoral Rights

Harvey owns a small commercial building that he rents to Lucy, who opens a ceramics shop. Lucy installs a kiln. Four years later, Harvey sells the property to Ann, who wants to start her own pottery business. When Lucy's lease is up, who owns the kiln?

Lucy because Lucy, the tenant, installed the kiln for her business. It's a trade fixture, and it's her personal property. Lucy would have to remove it when her lease is up, or she could sell the kiln to Ann, if they can agree to terms.

Water Rights Continued as examples

Many states east of the Mississippi River or states that have an abundance of water tend to have statutes that grant riparian and littoral rights. States west of the Mississippi, especially where water can be scarcer, tend to have statutes that grant appropriative rights. This doesn't mean that all of the different rights aren't found in different states. *It just means that there might be more of an emphasis on one set of rights.*

Which type of life estate is created by operation of law?

Martial Law and only

Check in #4: John's neighbor has an oak tree whose branches and roots are extending across the lot line into John's backyard. Which of John's right is NOT being violated?

Mineral because the tree is not a mineral, the tree is violating all of John's rights except mineral rights. The branches are in the air space, and the roots are in the subsurface. Even if there are no roots on the surface of the ground, you can expect that John has to deal with the acorns and the leaves that the tree drops into his backyard.

Which type of factory-built home is automatically considered real property once it is constructed onsite?

Modular homes

Two Attachments are

Natural and Man-made

Harry buys a house from Tom as fee simple. Can Tom take the house back because he doesn't like the color Harry painted the shutters?

No

In his will, Joe leaves everything to his son, Bill, who now has a reversionary interest in the estate as well. Let's say that Joe dies before Sue dies. Since Joe's son Bill gets everything, according to Joe's will, can Bill kick sister Sue off the property and take possession fee simple?

No

Ellen is granted a life estate by her uncle. Ellen has a young son, Jon, and she wants to ensure he is cared for in the event of her death. Can Ellen will her life estate to Jon?

No: A life tenant's interest in land can be sold, mortgaged, or leased, but it cannot be willed. Ellen's life estate ends at her death.

Fructus Naturales means

Occurring plants ("fruits of nature"), generally considered part of REAL PROPERTY. Also called natural attachments. Lastly, they are emblements. examples are trees, natural vegetation, and perennial plants.

Estate for the life of another (Pur Autre Vie) example

Paul owns property in fee simple. He decides to deed his property to Sue for as long as Mike lives. Sue is the life tenant, and Mike is the measuring life. When Mike dies, the life estate ends and Sue no longer has the right to occupy and use the property.

Annexor

Person who owns an item as personal property and attaches it onto real property, making it a part of the real property.

A new chandelier is still in the box. What kind of property is that chandelier?

Personal Property

What about leased property, such as a satellite dish that's bolted to the roof? Do you think that would be real or personal property?

Personal Property because It might look like real property, since it's attached to the roof, but it belongs to the satellite dish company, and so it's personal property.

Fructus Industriales

Plants planted and cultivated by people ("fruits of industry"), generally considered personal property. Also called:Emblements.

You take the chandelier out of the box and attach it to the ceiling above the dining room table. Now what kind of property is the chandelier?

Real Property

hich of the following is an example of real property? An in-ground swimming pool:

Real property is land, all rights associated with the property, and the things attached to it. Thus, the inground swimming pool is real property because it is permanently attached to the land. The fire pit and truck can be moved and are personal property. Annuals must be planted each year and are also considered personal property.

Digging up knock-out rose bushes from a flower garden and planting them in pots is an example of:

Severance

Life Tenant

Someone who owns a life estate; the person entitled to possession of the property during the measuring life.

Let's say that Joe grants a life estate to daughter Sue. When Sue dies, the life estate reverts to Joe. In this scenario, who is the life tenant?

Sue

As a result, the filed security agreement gives the lender right to repossess financed items to satisfy repayment. The lender can even remove item attached to real property.

TRUE

Check in #3: Frank owns a 12-story apartment building along the freeway. He agrees to allow an outdoor advertising agency to erect a billboard on the roof of his building. Frank is exercising his ownership rights to the air.

TRUE

Landowners owns all the solid minerals in or under the land

TRUE

True/False:Real estate licensees should be careful not to give any legal advice to clients about disputes over real and personal property (or for any topic), as this could be considered unauthorized practice of law.

TRUE

Can a landowner sell or lease mineral rights separately from the surface land, and do so, especially if they do not have the necessary skill or equipment to mine or drill. Can they also drain oil or gas from beneath owned land and from neighboring land because of oil and gas flow toward the point of lowest pressure where the reservoir was pierced by the well?

TRUE.

Personal Property

Tangible items that (usually) are not permanently attached to or part of real estate; any property that is not real property; movable property not affixed to land. Also called: Chattel or Personalty.

Water Rights

The ______ of an owner of land contiguous to or touching a body of water vary according to the type of water in question. There can be littoral rights, riparian rights, and appropriative rights.

Today's manufactured homes are built to the rigid standards of the U.S. Department of Housing and Urban Development (HUD).

The exterior of the structure will have a HUD certification label affixed to it to signify it is built to HUD code. The HUD code requires that the home be constructed on a permanent, non-removable steel chassis but the entire structure can be placed on a permanent foundation after being transported to the landowner's building site, if the homeowner desires.

Fee Simple Absolute

The greatest estate (ownership) one can have in real property because it is freely transferable and inheritable, and of indefinite duration, with no conditions on the title. May be called Fee Simple or Fee Title.

Subsurface Rights

The implication that an owner of land has rights to the land below the surface to the center of the earth, even though this part is not documented

Fee simple conditional estates: exceptions

The right to reclaim the property through the violation of a condition subsequent or a restriction on the deed does not apply to a restriction or covenant from a builder, developer, or homeowners' association.

Air Rights Continued

The right to undisturbed use and control of ___________ over a parcel of land (within reasonable limits for ____ travel); may be transferred separately from the land.

Alluvion

The solid material deposited along a shore by accretion. Also called alluvium. A part of Accretion.

Forces of Nature: Accretion continued

These deposits are called alluvion or alluvium. This is the opposite of erosion and is what happens when your neighbor's soil gets deposited on your land. Riparian or littoral property is often increased this way, and the landowner gains the title to the silt. By the way, when someone receives the title of something that is added to a piece of real property either by annexation or the forces of nature, it is accession.

The UCC has numerous provisions when an owner has financed the purchase of a fixture installed on the real property. One primary one is for the lender (creditor) to retain a security interest in the personal property until the lender is paid in full.

This is implemented by an instrument called a security agreement filed in the office of the Registrar of Deeds.

Check in #9: Lenny owns a home within the city limits. In a corner of his property, he has an elaborate garden where he likes to sit quietly. He gets new neighbors who have a teenager. The teen is in a band, which practices in the garage right next to Lenny's garden most evenings until late. What activity is happening, and what right is being infringed upon?

This is nuisance, which is infringing on Lenny's right of enjoyment.

Encroachment example

Thus, a neighbor's driveway built over your property line encroaches on your land. A tree growing over a property line is another example of an encroachment. A landowner can take legal steps to force a neighbor to remove the encroachment by tearing it down, trimming the tree, or buying the land on which it sits.

Three ways that count as interfering with Real Property Rights

Trespass, encroachment, and nuisance. (T.U.E)

Any attached item is considered the homeowner's personal property until the security agreement has been paid in full.

True

Check in #6:Marcus owns a cottage on the lake. When he sells the cottage, his littoral rights are automatically transferred to the new owner.

True

If Bill owns land in fee simple absolute and transfers it to Bonnie without any limiting language, then Bonnie owns the land in fee simple absolute

True

If the condition or requirement is not met, the ownership of the fee simple estate could terminate

True

In most cases of ownership, the person referred to as the "owner" of land usually holds a fee simple interest. The owner of a fee simple estate has the entire bundle of legal rights.

True

The value of the item in question is not a factor when determining whether it is a fixture or it is personal property.

True

True/False: A written agreement, such as the North Carolina Bar Association / North Carolina Association of REALTORS® Standard Form #2-T, Offer to Purchase and Contracts (for REALTORS® only) can be used to avoid misunderstandings

True

Unless otherwise indicated in the lease agreement, the tenant can and should remove any trade fixtures before the lease ends as long as its removal does not materially injure the leased property.

True

Forces of Nature; Erosion continued

Water could include rain or flowing water. If the eroded soil moves over property lines, the soil becomes the property of someone. So, if your eroded soil is carried downstream to Bob, your neighbor, you lose title to the soil and he gains title to the soil. The good news is that chances are, you are getting title to someone else's eroded soil upstream from you, and so on down the line.

Appropriative Rights / Doctrine of Prior Appropriation

Water rights allocated by government permit, according to an appropriation system. It is not necessary to own property beside the body of water to apply for an appropriation permit. Another way- are water rights granted by government permit independent of land ownership. This may be referred to as the __________________________________

Littoral Rights definition

Water rights of landowners whose land touches a commercial lake, sea, or ocean.

Riparian Rights continued

Water rights of landowners whose land touches a natural body of flowing water such as a stream, creek, or river are said to be ______. *The owner of such property has the right to use and enjoy the water*

Riparian Rights definition

Water rights of landowners whose land touches a natural body of water, such as a stream, a river, or an inland lake.

Part 2: method of Annexation

What is the adaptability of the item to the real estate? How was it attached, and can it be removed without damaging the property? There is actual annexation (a fixture is physically attached to real property like a garage) and constructive annexation (personal property is associated in such a way that the law treats it as a fixture, like a key to the house). Some factors that a court might use to determine the manner of annexation are the permanence of attachment and the difficulty of removal and any potential damage that might result.

Part 4: Relationship of the annexor to the property:

What is the relationship of the parties? Between a seller and a buyer of real property, the rules for determining whether an item is a fixture are usually interpreted in favor of the buyer. Between a landlord and a tenant, the rules tend to be interpreted in favor of the tenant. A tenant who installs a chandelier, for example, usually has the right to remove it at the end of the lease. These rules are tied to the annexor's intentions; the law presumes a homeowner intends to improve real property, but a tenant installs things only for personal use.

Part 1: Intention:

What was the intent of the person (annexor) installing or attaching the item? Did the property owner buy the item to improve the real property or simply purchase it with the intention of taking it once the property is sold? To answer these questions, the court will look for objective evidence of the annexor's intent. It's not enough to claim that the item was custom-made for the property or that the property owner always intended to remove the item.

Reliction

When a body of water gradually recedes, exposing land that was previously underwater.

Forces of nature

While land is considered to be indestructible, there are forces of nature that can cause the land to move or change shape. Through such forces, the value of property—and even title to the property—could be affected. Common forces include: Erosion, accretion, avulsion, reliction. (A.R.E.A)

Remainder

With a remainder life estate, the grantor grants the life estate to the life tenant, but upon the death of the person who is the measuring life, another person receives and possesses the property. This person is known as the remainderman. A remainder interest is inheritable. A future interest that becomes possessory when a life estate terminates, and that is held by someone other than the grantor of the life estate.

Reversionary

With a reversionary life estate, upon the death of the person who is the measuring life, the property reverts to the grantor or the grantor's heirs.

Andrew conveys a life estate to his younger son Bart for as long as his wife Carla shall live, and then to his son Doug. Can Bart sell his interest in the property to his cousin Fred?

Yes

Do you think that a buyer can acquire personal property as part of an agreement to purchase real property?

Yes

Check in #10:Do you think that a buyer can acquire personal property as part of an agreement to purchase real property?

Yes: (Reason: It's very common to include personal property in a sales agreement, typically appliances, but it could be for anything as long as the buyer and seller agree.)

Jill grants a life estate to her brother, Jim. Jim gets a job out of state and will no longer live on the property; besides, he needs money to move and get a new place. Can he sell his life estate to Pam?

Yes: Jim can indeed sell his interest in the property. Pam can live on the property, but she does not own the property. Her interest ends when Jim, the measuring life, dies. This describes life estate pur autre vie.

You own 20 acres of land in the mountains. You decide to deed the land to your niece. However, you want to make sure that the pristine beauty of the property is not marred by development, so you indicate that at least 10 acres must remain undeveloped. This is an example of :the specific deed language is, "My niece and her heirs may have the land as long as 10 acres remains undeveloped." Your niece later turns the entire 20 acres into a parking lot for the ski resort next door. Do you have the right to reclaim that land without going to court?

Yes: When you used the words "as long as," you granted a fee simple determinable estate that gives you the right to regain the use and possession of the property automatically if the condition is not met. As long as the conditions are met, however, a freehold estate can theoretically go on forever. Irv's title had a condition on it—that alcohol is never served on the property. He could not then sell the property to someone else and convey a greater interest than what he had. Sellers can convey only what they own or less than what they own, never more.

Your property sits on a large navigable river. Which statement is FALSE?.

You can stop people from boating in front of your home.

Depending on the type of estate that has been created

a person's interests in the property will be different.

freehold estate is

a possessory interest of an indefinite amount of time or without a specific termination date; it may end, but no one knows when that might be

The right to use water is either

a riparian right or an appropriative right

Forces of Nature: Avulsion continued

a sudden process where land is torn away by some natural force such as flowing water, mudslide, or an earthquake; for example, a river suddenly changes its channel due to a flash flood. Avulsion doesn't transfer title if the severed land is identified and reclaimed by the original owner.

An irrigation system installed by Joe on his leased peach orchid ranch is considered-

a trade fixture and remains the property of Joe at the end of the lease.

A qualified fee estate creates

a type of encumbrance on the title because it runs with the land, meaning that the restriction is not against the owner but is against the property itself and that the restriction or condition remains with every ownership transfer.

Examples of intangible property

accounts receivables, stock rights, a lease, or intellectual property.

An improvement does NOT include

additions or alterations that are merely routine maintenance, repairs, or replacements.

Bundle of Rights: Control:

allows the owner to physically alter or change the property. For example, a property owner can build a garage, tear down a fence, put in a swimming pool, etc. Of course, there could be zoning issues related to this

Bundle of Rights: Exclusion:

allows the owner to stop others from using the property or even from entering the property. Example: allows the owner to stop others from using the property or even from entering the property.

Modular Housing

also built in a factory; however, they are different from manufactured houses in that the factory construction is assembled by a builder onsite on the permanent foundation. Therefore, the homes are considered real property at that point.

tates of inheritance: Defeasible fee estates

also called a qualified fee estate or a fee simple defeasible estate—means that the grantor (the person giving the estate) puts a condition or requirement in the deed

Which item is LEAST LIKELY to be an attachment?:

an above-ground children's pool: Since the pool is not actually attached to the property, it is still considered to be personal property. The key to the attic is an example of constructive annexation, which is necessary to access the attic. The island in the kitchen is a man-made attachment, and the orchard is a natural attachment.

With real property, when we have a right or a claim against a property, we have what is called

an estate or interest

Improvements

any addition to or change in a condition of real property to increase its value or utility.

Dower rights

apply to a widowed wife's interest in a deceased husband's property. The interest held by a married person in the real property owned by a spouse; generally refers to a wife's interest in her husband's property. Not recognized in all states including North Carolina.

Trade Fixtures

are any equipment or personal property items a tenant installs or attaches to leased real property for use in the tenant's business or trade. Unlike regular fixtures, which become part of the real property to which they are attached and thus belongs to the owner of the real property, ___________ remain the personal property of the tenant.

Mineral Rights

are considered real property until they are extracted from the earth. Also, they are _______ to the ______ located beneath the surface of the land.

Appurtenances

are rights that transfer with real property, or "run with the land." When real property is sold, appurtenant rights are usually transferred along with it. They can, however, be sold separately and may be limited by past transactions.

possessory interests

are the interests you have if you own or possess real property. Also known as estate

possessory interests

are the interests you have if you own or possess real property. Also known as estate. An interest in property that entitles the holder to possess and occupy the property, now or in the future; an estate, which may be either a freehold or leasehold.

Annexation of personal property

attaching of a smaller item to a larger item. When studying real property, annexation is attaching personal property to real property, thereby creating a fixture. For example, when a sink is annexed to the plumbing outlet, it becomes a fixture and is, at that point, real property. Another example of annexation is removing the knock-out rose bushes from the pot and planting them into the ground, thereby converting personal property to real property.

Brett bought a farm and also wanted to separately purchase two tractors the seller owned. What would MOST LIKELY be required at the settlement to transfer ownership of those tractors?:

bill of sales

improved land and improved lot

can have dual meanings and it is up to you, the real estate broker, to determine the meaning based on the situation and convey this meaning to the parties involved. 1—land on which improvements (like buildings) have been constructed. 2—land that has been prepared for further development (improved) by grading, drainage, installation of utilities, etc.

What is Personal Property

chattel or personalty. It is anything that is not real property; therefore, it is not attached to the land and is movable (although it not necessarily easy to move). Some examples of personal property may be detached household furniture, appliances, clothing, automobiles, jewelry, etc.

Severance for personal property

converting an item from real property to personal property. This is done by detaching the item from the land. For example, digging up knock-out rose bushes from a flower garden and planting them in pots is an example of severance.

statutory life estate

created as a matter of law to protect family members after a death

Detaching Fixtures

detached from the land and so revert to personal property through the process of severance (such as when a chandelier is removed from the ceiling). The determination of whether or not an attachment is actually a fixture or is personal property is critical.

Examples of personal property

detached household furniture, appliances, clothing, automobiles, jewelry, etc. personal possessions- car/ book/cat/harvested crops

some required duties of the life tenant:

deteriorate and cause depreciation. Here are some required duties of the life tenant: Pay real property taxes on the life estate property. Pay an assessment levied by a county or municipality against the life estate land for improvements made, such as water/sewer lines and street paving. Make repairs to the improvements on the land so the property doesn't deteriorate and cause depreciation.

Qualified fee estates may be classified as

determinable or conditional

Example of severance

digging up knock-out rose bushes from a flower garden and planting them in pots

Gareth inherits a plot of land from Jessie. A year later, he sells half of the property to Kim. A year later, she gives her half to Alex, who sells the mineral rights. This series of events best represents the legal property right of:

disposition

Public Improvement

done by the government and are considered "improvements to the land" (e.g., grading, drainage, ditches, utility connections, sidewalks, curbs, and gutters).

Manufactured housing

dwellings that are constructed inside a factory. Ex: mobile homes/house trailer

Two classifications of freehold estates

estates of inheritance and estates not of inheritanc

The most common form of real property ownership in the US is

fee simple absolute estate

You own 20 acres of land in the mountains. You decide to deed the land to your niece. However, you want to make sure that the pristine beauty of the property is not marred by development, so you indicate that at least 10 acres must remain undeveloped. This is an example of

fee simple defeasible

Mike sold his land to Pam with the condition that she does not disturb the spring house built in 1750 that's on the back of the property. When Pam tore the spring house down to put up a horse barn, Mike exercised his right of re-entry. What type of estate did Mike grant Pam, and what did Mike have to do to get the land back?

fee simple subject to a condition subsequent; Mike goes to court: The right of re-entry that is an element of a fee simple subject to condition subsequent estate means that the original grantor has to prove in court that the condition occurred; it is not automatic. The possibility of reverter that is an element of the determinable fee estate is automatic.

The two primary types of interests or estates related to real property are

freehold estates and nonfreehold (leasehold estates). related to real property are freehold estates and nonfreehold (leasehold estates).

Estates can be either

freehold estates or nonfreehold estates

The proper term for flowers, crops, and other vegetation that are planted or cultivated annually or seasonally is

fructus industriales, meaning fruits of industry. Another word for fructus industriales is emblements.

Bundle of Rights: Enjoyment:

gives the owner the freedom to possess and use the land without interference from other people or society. However, this also includes a responsibility to make sure that their neighbors' enjoyment is not hindered or adversely affected.

Bundle of Rights: possession

gives the owner the right to physically occupy the land and to use the land and make it productive. Owners can use the land in any way they want, as long as it is legal and does not interfere with other people's rights.

Appropriated water does not

have to be used on riparian or littoral land, but riparian and littoral landowner rights are considered when issuing _____________________________ permits. Still, _______________________ usually cannot interfere with riparian or littoral rights.

Littoral Rights continued

if the property is subject to the ebb and flow of the tide, such as an ocean, bay, or large, commercial lake, the rights are said to be ________. **Owners have unrestricted rights to use and enjoy the surface of the water.****

Modular homes are built

in compliance with state building codes, rather than HUD codes. The units will have an identifying label and serial number confirming state inspection, which can be found on the unit in one of a few places, including on the back of the unit, under a sink, or near the service panel.

Most estates of inheritance are

inherited by the owner's heirs and are known as "fee" estates—the word fee meaning ownership that is inheritable

North Carolina Agriculture fixtures

installed by a commercial/farmer tenant for the express purpose of agriculture use. An example is an underground irrigation system. While historical (common law) held that agricultural fixtures became part of the real property and could not be removed at the end of the lease term, the modern trend is to treat agricultural fixtures the same as trade fixtures--which is to remain the personal property of the tenant. Prudent prospective agriculture tenants should review lease terms for right of removal prior to signing the lease agreement.

Which of these is NOT classified as real property?

irises planted in a flower box on your deck

Nonfreehold Estates:

is an estate in which the holder (the tenant or lessee) does not have an ownership interest in the property. The tenant only has the right of possession and use so the interest lasts less than a lifetime.

Nuisance

is anything that interferes with the quiet enjoyment of land from another person's property such as loud noises, unsightliness, and obnoxious odors. It does not involve possession of the property. To be actionable in court, it must be a continuing unreasonable use of land by the offending landowner, but a court usually will not support an action if a landowner moved there with knowledge of it.

Real estate

is defined as the actual physical land (also known as unimproved land or raw land) and everything, both natural and man-made, that is permanently attached to it The actual physical land and everything, both *natural and man-made*, which is attached (or appurtenant) to it.

Leasehold Improvement:

is installed by the landlord for the use of the tenant. For example, a landlord installs a wood-burning stove in the living room of a single-family home. Since the stove was installed by the landlord and is attached to the house, it would be considered real property of the landlord

Real property

is land and its attachments, including the improvements (man-made attachments) and buildings thereon, as well as all of the rights associated with the ________ The physical land and everything attached to it, and the *rights of ownership (bundle of rights) in the real estate. Also called realty.*

Land

is legally considered to include the surface of the earth, the subsurface to the center of the earth, and the air above the land.

Personal property

is most easily defined as any property that is not real property. It is moveable, thus not fixed to the land.

Lateral Support *remember side*

is support from *adjacent land*. A neighbor's excavations may make your land shift and settle. In some cases, the neighbor can be held liable for resulting damage if there was negligence.

Subjacent Support

is support from the *underlying earth*. Generally, the mining party is liable for surface damage caused by underground mining even if excavations were performed carefully.

Estates of Inheritance: fee simple absolute estates

is the most complete and desirable freehold estate interest that exists in real property because it means ownership for a lifetime. For those reasons, it is also the most common form of real property ownership in the United States. It is also called fee title, ownership in fee, or fee simple.

Fixtures

items that start out as personal property but once it is attached to real property, it belongs to the owner of the real property to which it is attached. A simple example is building supplies that are initially personal property once purchased in a store, becomes part of the real property when it is used to construct a building.

Estates of Inheritance

last a lifetime and may continue beyond the life of the owner and transfer under the owner's will or by intestate succession (if the owner dies without a will)

????

last a lifetime and may continue beyond the life of the owner and transfer under the owner's will or by intestate succession (if the owner dies without a will). Also, associated with the land/property concepts of title or ownership

homestead

laws apply to the distribution of the property, affording some protection to a surviving spouse and/or minor children. A statutory or legal life estate recognized in some states that protect the estate belonging to a deceased person for the use of a surviving spouse and minor children.

Estates not of inheritance: estates not of inheritance

life estates life estate is a freehold estate that lasts only as long as a specified person, who is the "measuring life," remains alive.holder of a life estate is called a life tenant. "Tenant," in this context, does not refer to a rental or leasing condition, but to the person who has the right to occupy and use the property.

You live in a house on the shores of Lake Michigan. You are a ________ owner, which means that you ________ own the land under the water.:

littoral/dont

in North Carolina and many states, a fee simple absolute owner

may transfer his interest by deed without reference to "heirs" included in the language; the interest can be transferred to Mary Jones or Mary Jones and her heirs.

Fee simple determinable

means that a grantor puts a condition or requirement in the deed that gives the grantor a "possibility of reverter," which is a right to regain the use and possession of the property automatically if the new owner does not comply with the stated condition or requirement. The key words are "as long as."

estovers

means they can cut a reasonable amount of timber from the land to repair buildings or use it for fuel, but does not allow the tenant to cut and sell the timber for profit. An _______________ violation or any act by the life tenant to use the property in a way that damages it or reduces its market value is referred to as an act of waste. A life tenant's right to cut a reasonable amount of timber from the land to repair buildings or use it for fuel, but does not allow the tenant to cut and sell the timber for profit.

Check in #1. Real property consists of all of the following EXCEPT:

movable items not fixed to the land. Reason: (Real property is land and its attachments, including the improvements (man-made attachments) and buildings thereon, as well as all of the rights associated with the property. Personal property is most easily defined as any property that is not real property. It is moveable, thus not fixed to the land.)

Pick the apple from the tree

personal property

Trespass

physical invasion of land by another person who has no lawful right to enter it. It interferes with the owner's bundle of rights, diminishing the owner's right of use and right of quiet enjoyment since, during it, the owner of the land has less than full possession of it.

Natural Attachments

plants growing on the land

Two different types of Freehold Estates

possessory and nonpossessory

Private Improvement

primarily done by the property owner and are considered "improvements on the land" (e.g., permanent structures such as buildings, walls, fences, tennis courts, swimming pools, and paved driveways).

Tangible:

property is something that can be touched or held. When you think of personal possessions, such as a car or book, you are actually thinking about personal property. Also, it can be things that, at first, you might not consider personal property, such as a cat or harvested crops. All of these things can be moved.

Air Rights

property owner mean the right to the _____ space above the property to the upper limits of the sky. Now, property owners still have the right to use the lower reaches over their land, but they may not interfere with _____ traffic. Giving the federal government control of the _____ above property does not mean that owners give up basic rights. *Owners still have the right not to be harmed by the use of the ______ space above their property.

Fee refers to the

quantity of the title (forever or at least a lifetime), not the quality of the title (that it is free of liens, for example).

Manufactured homes can be either

real or personal property depending on the owner

Plants such as trees, perennial flowers, and other vegetation are considered to be part of the land while growing, therefore

real property

the owner can convert it to real property by:

removing the wheels, axle, and moving hitch, which are added during the factory construction attaching the house to a permanent foundation owed by the homeowner filing an affidavit of conversion to cancel the DMV title

Which transaction does NOT represent an example of an appurtenance?

selling the fructus industriales grown on your land:

Some personal property can be

severed and attached. severed from real property and others can be attached to real property by annexation.

Common trade fixtures include

shelving and display racks outdoor advertising signs machinery and equipment specialized equipment in a restaurant or bar storage tanks

Tangible property

something that can be touched or held

Intangible property

something that cannot be held or touched

Intangible

something that cannot be held or touched, for example, accounts receivables, stock rights, a lease, or intellectual property.

On the National exam, an improvement is considered an appurtenance, a right that "runs with the land" on real property, such as air, water, and mineral rights.

swimming pool cracks repaired by a homeowner:

Personal Property can be classified as

tangible or intangible

Personal property can be classified as either

tangible or intangible:

Attachments

that can be transferred with the land. Also implies things that are ________ to the land. an-made_______ that are artificially __________ to the land are more commonly known as improvements

Accession is

the acquisition of title to land by its addition to real estate already owned, through human actions or natural processes. *Part of Accretion*

Annexation

the attaching of a smaller item to a larger item. When studying real property, annexation is attaching personal property to real property, thereby creating a fixture.

Which item is LEAST LIKELY to be a fixture?:

the curio cabinet in the living room that matches the room's decor

The North Carolina Homestead Exemption Law protects

the equity (interest) in the homeowner's residence (both real and personal property) from creditors and lawsuits, including bankruptcy filings.

Forces of Nature: Reliction continued

the gradual receding of water from a shoreline, exposing more of the water bed. This exposed land mass becomes part of your property. One cause for reliction is the gradual evaporation of the water. In some cases, reliction does not increase the amount of property you own if you already own the land under the water.

The North Carolina Homestead Exemption Law protects the equity (interest) in

the homeowner's residence (both real and personal property) from creditors and lawsuits, including bankruptcy filings

If a tenant chooses NOT to remove fixtures after the lease terms

the items are considered abandoned and he forfeits them to the property owner.

Conventional Life Estates

the measuring life and the life tenant are the same person.

A fee simple absolute estate

the most complete and desirable freehold estate interest that exists in real property because it means ownership for a lifetime.

The definition of real estate also encompasses natural attachments;

the plants growing on the land. Trees, natural vegetation, and perennial plants are called fructus naturales, or fruits of nature. They can either be naturally occurring or planted.

Severance

the process of converting an item from real property to personal property. This is done by detaching the item from the land.

Oil and gas are governed by

the rule of capture

A fee simple absolute estate implies

there are no conditions on the deed or title. It is perpetual, inheritable, and transferable

Conveying Personal Property

transfer of real property and its attachments is usually completed with a deed.

separate bill of sale

transfers ownership to tangible personal property. *the real estate licensees working with the parties—and the attorneys on both sides—should be made aware of any such separate deals.*

separate bill of sale- personal property

transfers ownership to tangible personal property. Still, the real estate licensees working with the parties—and the attorneys on both sides—should be made aware of any such separate deals.

Emblements are considered personal property

true

Harvested corn is an emblement:

true

curtesy rights

typically apply to a widowed husband's interest in a deceased wife's property. An interest held by a married person in the real property owned by a spouse; refers to a husband's interest in his wife's property. Not recognized in all states.

All of these are considered when determining whether an item is a fixture or personal property EXCEPT:

value of the annexed item: The value of the item is not considered. Most often, the item is valuable. Intention and manner of annexation are the most heavily weighted factors.

Encroachment occurs

when a physical object intrudes onto neighboring property, often due to a mistake with the boundary. It is similar to trespass but involves objects instead of people.

Examples of Annexation

when a sink is annexed to the plumbing outlet, it becomes a fixture and is, at that point, real property, or removing the knock-out rose bushes from the pot and planting them into the ground, thereby converting personal property to real property.

The rule of capture

which says whoever drills a well on their land owns all the oil or gas the well produces even though it may have migrated from under a neighbor's land. Also, it is designed to stimulate oil and gas production since the only way to stop oil or gas from going to a neighbor's well is by drilling your own

When you buy real property

you get the land, the attachments, plus a bundle of rights that are granted when you take ownership of the property that cannot be separated from real property. Ex: possession, quiet enjoyment, disposition, exclusion, control.

Nonfreehold Estate

—An estate in which the individual does not have an ownership interest in the property, only the right of possession and use, such as a tenant in a rental property. There are four types of nonfreehold estates (leases): tenancy at will, tenancy from period-to-period, tenancy for years, and tenancy at sufferance. Also called: Leasehold Estate.