California Real Estate Chapter 4

Ejectment

"A court can order the removal of an encroachment through a judicial action"

Express Reservation

"A landowner who is conveying a portion of his property may reserve an easement in that parcel to benefit the parcel of land that is retained. Like an express grant, an express reservation must be put into writing & recorded."

Materialman's lien

"A mechanic's lien claimed by someone who provides materials (as opposed to labor) "

Mortgages

"A mortgage is a specific, voluntary lien created by a contract between the property owner (the mortgagor) and the creditor (the mortgagee) when the property is offered as security for a loan. The mortgagee is usually a lender, who will not loan money unless the borrower gives a lien as security for repayment. A mortgage lien is created by contract between the property owner and a lender. The owner gives the lender the mortgage as security for repayment of the loan, so that the property serves as collateral. The mortgage is a voluntary, specific lien. It can attach only to a piece of property voluntarily offered as security for a debt. With the lien in place, the property serves as collateral for the loan." "The most significant difference between mortgages and deeds of trust is in the foreclosure process"

Encumbrance

"A nonpossessory right or interest in real property held by someone other than the property owner. It is either a financial burden or a nonfinancial burden on the property owner's title. Encumbrances are nonpossessory interests in real property. In other words, they are interests that don't include ownership or possession of the property. Nonpossessory interests are called encumbrances because they encumber the owner's title. That is, they are a burden on the title. Without any encumbrances, the owner would have greater freedom in regard to the property. However, completely unencumbered property is the exception rather than the rule. The interest can be financial or nonfinancial in nature."

Nuisances

"A nuisance is an activity or a condition on neighboring property that interferes with a property owner's reasonable use or enjoyment of her own property. Common examples include odors, noise, and interference with communication signals. Like an encroachment, a nuisance is NOT truly an encumbrance, but rather a violation of an owner's possessory rights." "A property owner may ask a court for an injunction against a private or public nuisance, or may sue for damages." "Licenses, encroachments, and nuisances also may affect the use or condition of property. They are not classified as encumbrances, however, because they are not interests in real property."

Covenants vs. Conditions

"A private restriction is either a covenant or a condition" "Whether a particular restriction is a covenant or a condition depends on the wording in the deed. Courts try to avoid forfeiture, which is considered a harsh remedy, so they will usually interpret a restriction as a covenant rather than a condition if there is any ambiguity. (Note that CC&Rs are virtually always interpreted to be covenants, even though the term includes the word "conditions.")"

Covenant

"A promise by a landowner to refrain from using her land in a particular manner" "A legally enforceable promise to do or not do something, as in a contract. A property owner who violates a covenant may be sued, leading to an injunction (a court order directing the owner to comply with the covenant) or, less often, payment of damages for failure to comply. Violation of a condition can have more serious consequences." Violation of a covenant can result in a court order (an injunction) directing that the violation be stopped. The court may also order the violator to pay money damages to someone who has suffered harm as a result of the violation.

Attractive nuisance doctrine

"A related concept is the attractive nuisance doctrine. The owner of a property with a feature that is dangerous and attractive to children, such as an unfenced swimming pool or construction site, will be held liable for any harm resulting from failure to keep out trespassing children."

Voluntary lien

"A security interest given to a creditor voluntarily" The lien priority of mortgages and deeds of trust is generally established by recording date. 'First to record is first in right.' A voluntary lien is one that the property owner voluntarily grants to a creditor. Mortgages and deeds of trust are voluntary liens. "One the debtor voluntarily gives to the creditor, usually as security for a loan. The two types of voluntary liens are mortgages and deeds of trust."

Liens

"A security interest in property; it is held by a creditor of the property owner. "A lien may also be defined as a charge imposed on real property as security for a specific act." "May be voluntary or involuntary" "May also be classified as general or specific" "The most familiar example of a lien is a mortgage." "Does not prevent the debtor from transferring the property, but the new owner takes title subject to the lien. The creditor can still foreclose if the debt is not repaid, even though the debtor no longer owns the property." "The date of attachment can be very important, since it may affect the lien's priority in relation to other liens."

Public nuisance

"Affects a larger community's health or welfare; jet noise and industrial emissions

Private nuisance

"Affects only a few surrounding people. For example, rotting garbage in a neighbor's backyard would be a private nuisance"

Nonfinancial encumbrance

"Affects the use or physical use or condition of the property itself" -Easements -Profits -Private restrictions "Thus, a property owner can find the use of his land limited by a right or interest held by someone else. "Licenses, encroachments, and nuisances also involve someone using another's property or affecting the owner's use of it, although they aren't actually interests in real property."

Notice of cessation

"Alternatively, the owner is allowed to file a notice of cessation after all work on the project has been stopped for a continuous period of 30 days, regardless of whether or not the project has been completed."

Easements

"An easement is a right to use another person's land for a particular purpose. Easement rights may be created to last forever (in perpetuity), for the life of the grantor, or for a term of years. It is a nonpossessory interest in land; the easement holder has a right to use the land, but has no title or right of possession. An easement is not an estate." "An easement runs with the land, affecting the title of subsequent owners of the property or properties in question." From the property owner's point of view, the easement is an encumbrance that burdens her title.

Abandonment

"An easement is also terminated if the dominant tenant abandons it. This requires acts by the dominant tenant indicating an intent to abandon the easement. Mere nonuse is not considered abandonment." For an easement to be terminated by abandonment, the easement holder (the dominant tenant) must do something that indicates an intent to stop using the easement forever. "Even though as a general rule easements are not terminated by nonuse alone (without evidence of intention to abandon), there is an exception for easements that were created by prescription: a prescriptive easement terminates automatically after five years of nonuse. There's an exception, however: after a period of nonuse (in California, five years), a prescriptive easement will terminate automatically. That rule applies only to easements created by prescription, though. Also, if any type of easement is unused for 20 years, the owner of the servient tenement can petition a court to declare the easement terminated."

Express Grant

"An easement is created by express grant when a property owner grants someone else the right to use the property. The owner deliberately makes her property into a servient tenement. The grant must be put into writing, signed by the grantor, recorded, and must comply with all the other requirements for conveyance of an interest in land. This is a requirement of the law known as the statute of frauds." A document creating an easement should always be recorded to provide public notice of the easement. Otherwise the easement holder might not be able to enforce his easement rights against someone who bought the servient tenement unaware of the easement. A document creating an easement usually must fulfill the same requirements as a valid deed. However, the document does not have to specify the exact location of the easement. A grant of an easement "across Lot A for purposes of ingress and egress" is valid. "When granting an easement, the grantor doesn't have to specify the location of the easement" "A person can grant an easement only in the interest that she holds." "For instance, if a tenant grants an easement in the leased property, the easement will exist only for the term of the lease. For instance, if Karen were leasing a property for ten years, any easement she granted would be good only for that ten-year term. A person can't convey a greater interest in property than the interest she holds herself. A fee simple owner may grant an easement that will last in perpetuity (indefinitely), or for the life of the grantor, or only for a specified term."

Encroachments

"An encroachment is a physical object that intrudes from one person's land onto another's without authorization, such as a fence or garage built partially over the property line onto the neighbor's land. Most encroachments are unintentional, resulting from a mistake concerning the exact location of the property line. An encroachment is NOT an encumbrance, because it is not a right or interest held by the encroacher. An encroachment may be a trespass if it violates the neighboring owner's rights of possession. A court can order the removal of an encroachment through a judicial action called an ejectment. Alternatively, if the cost of the removal would be too great, the court could order the encroacher to pay damages to the neighbor" "Licenses, encroachments, and nuisances also may affect the use or condition of property. They are not classified as encumbrances, however, because they are not interests in real property." The property owner must bring a court action against the encroacher within three years of the time the encroachment was discovered, or the right to sue for damages or removal of the encroachment will be lost.

Trustee

"An independent third party Handles foreclosure if necessary (often an attorney or title insurance company)"

Homestead

"An owner-occupied dwelling, together with any appurtenant buildings and land"

Lien Priority

"As a general rule, lien priority is determined by the date a lien was recorded. The lien that was recorded first will be paid first, even though another lien may have been created first." First to record, first in right. "The liens are paid according to their priority. This means that the lien with the highest priority is paid first. If any money is left over, the lien with the second highest priority is paid, and so forth. A particular lienholder might receive only partial payment, or even no payment at all." "In California, special priority is given to property tax and special assessment liens; they have priority over all other liens, regardless of when the other liens attached to the property. Mechanic's liens are another exception. Their priority is determined by the date that work on the entire project began, even though the claim of lien was recorded later on."

Specific lien

"Attaches only to a particular piece of property, not to everything the debtor owns. A mortgage is an example of a specific lien, because it attaches only to the specific piece of property the borrower offers as security for the loan. It is a lien against only the particular piece of property offered as security for the loan."

General lien

"Attaches to all of the debtor's property. For instance, the judgment lien in the example is a general lien. Any property owned by Bronson could be encumbered by the judgment lien."

Easements in Gross

"Benefits a person or a company rather than a parcel of land. But that rule doesn't apply in California. Under California law, a personal easement in gross is assignable and inheritable. Wilson could sell or will his easement in gross to another person." Some easements aren't appurtenant rights. Instead, they're personal rights, not tied to ownership of a parcel of land. There's a dominant tenant, but there's no dominant tenement—no property that benefits from the easement." "An easement in gross runs with the servient tenement." "Most easements in gross are commercial" "The most common example of a commercial easement in gross is an easement held by a utility company that allows company employees to enter property to install and service the utility lines. Commercial easements in gross can be assigned—transferred from one utility company to another. With a personal easement in gross, however, the transfer or assignment of the easement rights by the dominant tenant can be an issue. In many states, a personal easement in gross is not assignable, and it's extinguished when the dominant tenant dies.

Preliminary Notice

"California law generally requires a mechanic's lien claimant to give a preliminary notice of his right to claim a lien to the property owner, the general contractor, and the construction lender, if any. This must occur within 20 days after the claimant starts providing labor, services, or materials." Once the property owner has recorded a notice of completion or a notice of cessation, mechanic's lien claimants generally must file a claim of lien for recording within 30 days. However, an original contractor has 60 days (not just 30) after the notice of completion or cessation was recorded in which to file a claim of lien. An original contractor is a general contractor or any other claimant who has a contract directly with the property owner." "If the property owner fails to record either a notice of completion or a notice of cessation, all mechanic's lien claims may be filed for recording up to 90 days after work on the project has ended."

Easement Types

"Easements appurtenant & easements in gross"

Prescription - Terminating an Easement

"Easements can be created by prescription, and they can also be terminated by prescription. (This is true no matter how the easement was created.) An easement is extinguished by prescription if the servient tenant prevents the dominant tenant from using the easement for the statutory period (five years)"

Homestead Exemption

"Homestead property is exempt from judgment liens to the extent of the homestead exemption. A homestead is an owner-occupied dwelling. The homestead exemption protects a limited amount of the property's value against foreclosure of judgment liens and attachment liens. When a homestead is sold, the sale proceeds are protected (up to the exemption amount) for up to six months after the sale, giving the former owner a chance to reinvest those funds in another house. Currently, the standard exemption is $75,000. The exemption for a member of a family unit is $100,000. The exemption is $175,000 if the debtor or the debtor's spouse is over 65 or unable to work because of a disability. It's also $175,000 if the debtor or spouse is over 55 and has a low income. A judgment creditor cannot foreclose on a homestead unless the net value of the property is greater than the amount of the exemption. In other words, the property must be worth enough so that the sale proceeds would cover all of the liens against it, plus the homestead exemption amount. When a judgment lien is foreclosed on and homestead property is sold, the sale proceeds are applied in the following manner: 1. to pay all liens and encumbrances not subject to the homestead exemption (a deed of trust, for example); 2. to the homestead claimant in the amount of the exemption ($75,000, $100,000, or $175,000); 3. to pay the costs of sale; " 4. to the judgment creditor to satisfy the debt; 5. any surplus to the homestead claimant." "Money that's paid to the former owner as a result of the homestead exemption is protected from judgment creditors after the foreclosure sale for up to six months, during which time the funds may be reinvested in another homestead property." This means a judgment creditor can't foreclose on a homestead unless the property's net value is more than $75,000, $100,000, or $175,000, depending on the debtor's circumstances. The net value is the market value minus the total amount of the senior liens—those that have higher priority than the lien being foreclosed on. But a portion of the sale proceeds (the applicable statutory exemption amount) will continue to be protected against the claims of judgment creditors for six months. This six-month grace period applies whether the sale of the home is voluntary or forced. If the homestead claimant buys a new home within the six-month period, the exemption remains in effect and attaches to the new home. If a new home is not purchased in that time, the exemption terminates.

Termination

"Homestead protection is terminated when the property is sold, when the homesteader files a declaration of abandonment, or when the homesteader files a declaration of homestead on another property. Funds from the voluntary sale of homestead property (up to the amount of the homestead exemption) are protected from judgment creditors just as the proceeds of a forced sale are protected—for up to six months, to allow the homesteader to purchase another home. Homestead protection does not terminate automatically on the death of the homesteader. It continues for the benefit of the spouse, children, or other family members living on the property."

Declaration of homestead

"Homestead protection may be claimed by recording a declaration of homestead, or by claiming the exemption after the property has become subject to a judgment lien foreclosure proceeding. A declaration of homestead may be filed by the owner, by the owner's spouse, or by a guardian, attorney in fact, or other person authorized to act on behalf of the owner." A person can only have one homestead at a time. Homestead protection terminates if the owner files a declaration of homestead on a different property, if the homestead property is sold, or if a declaration of abandonment is filed. But a portion of the sale proceeds (the applicable statutory exemption amount) will continue to be protected against the claims of judgment creditors for six months. This six-month grace period applies whether the sale of the home is voluntary or forced. Homestead protection doesn't necessarily terminate if the owner dies; it may continue for the benefit of family members still living on the property.

Runs with the land

"If either the dominant tenement or the servient tenement is transferred to a new owner, the new owner also acquires the benefit or the burden of the easement." An easement appurtenant runs with the land. This means that its burden and its benefit are passed along to the subsequent owners of the servient and dominant properties.

Failure of Purpose

"If the purpose for which an easement was created ceases, then the easement terminates. For example, if an easement was created for a railroad and the railroad company later discontinued its use and removed the rails, the easement would be terminated through failure of purpose."

Proportionate distribution

"In some cases, the dollar amount of all the liens against a property add up to more than the property sells for at a foreclosure sale. When this happens, the sale proceeds are not allocated among all the lienholders in a pro rata fashion"

Termination of Restrictions

"It is up to the property owners within a subdivision to enforce the CC&Rs. If the residents have failed to enforce a particular restriction in the past, they may no longer be able to enforce it." "A private restriction will also terminate if its purpose can no longer be achieved. For example, this might occur because zoning changes and other factors have dramatically altered the character of the neighborhood. If there's a private restriction limiting a property to single-family residential use, but most of the surrounding properties are now used for light industry, the restriction may no longer be enforceable." A court may rule that the restriction has been abandoned.

Licenses

"Like an easement, a license gives someone the right to make some use of another person's land. However, easements and licenses are different in many ways. An easement is created in writing or through action of law. Ordinarily, a license is just spoken permission to cross, hunt or fish on, or make some other use of a landowner's property. An easement is irrevocable, but a license CAN BE revoked at the will of the landowner. In general, easements are permanent and licenses are temporary. A license is a personal right that does not run with or pass with the land. It cannot be assigned. Since the license is revocable at the will of the landowner, it is not actually considered an encumbrance or an interest in the property." "Licenses, encroachments, and nuisances also may affect the use or condition of property. They are not classified as encumbrances, however, because they are not interests in real property."

Other Liens

"Many other taxes, such as income taxes, estate or inheritance taxes, and gift taxes, can result in liens against property. General Lien Liens can also arise in connection with various other types of debts, such as child support, spousal maintenance, and condominium or homeowners association assessments."

Writ of execution

"Once a property is foreclosed it will be sold by a designated official to satisfy the judgment. To order the sale, the court issues a writ of execution."

Property Tax Liens

"Real property owners are required to pay general real estate taxes every year. Property tax liens are involuntary, specific liens" Property taxes and special assessment liens are specific liens against the taxed property are exceptions to the 'First to record' rule. They are superior to all other liens.. IRS liens are general liens against all of the delinquent taxpayer's property. Their property is assessed (appraised for tax purposes) and taxed according to its value. If the property taxes become delinquent, the property tax lien allows the government to foreclose on the property and collect the taxes from the proceeds of the foreclosure sale. When the taxes are levied, a lien attaches to the taxed property until the taxes are paid.

Notice of Nonresponsibility

"Sometimes construction contractors begin a project that has not been approved by the property owner. For instance, a tenant may order work to be done on the leased property without the landlord's knowledge or consent. If the tenant fails to pay for the work, the contractors, subcontractors, and suppliers could file mechanic's liens against the property, and the owner could be held responsible for the cost of the project" "There is a way for owners in this type of situation to protect themselves. Within ten days of becoming aware of an unauthorized construction project, a property owner can give notice that she will not be responsible for the work. This is done by posting a notice of nonresponsibility in a conspicuous place on the property, and also recording the notice. The notice must identify the property, the owner, and any tenant or purchaser of the property, and it must state that the owner will not be responsible for claims arising from the work done."

Special Assessment Liens

"Special assessments are levied to pay for local improvements, such as road paving or sewer lines, that benefit some, but not all, property owners within the county. The properties that have benefited from an improvement project are assessed for their share of the cost of the improvement. The assessment creates an involuntary, specific lien against each of those properties." Any owners who fail to pay the special assessment bill may face foreclosure.

Homestead Law

"State laws that give homeowners limited protection against lien foreclosure" "In California, the homestead law offers protection only against judgment liens and attachment liens. It does not apply to mortgages, deeds of trust, mechanic's liens, or liens for child support or spousal maintenance." Protects Against: -Judgement Liens -Attachment Liens Doesn't Protect Against -Mortgages or Deeds of Trust -Mechanic's Liens -Child Support or Spousal Maintenance Liens

Condemnation

"The government may exercise its power of eminent domain and condemn private property to gain an easement for a public purpose, such as a road. Through the condemnation process, the government can force a private property owner to grant it an easement. The easement must be needed for a public purpose, and the government must compensate the private owner. This power may also be exercised by private companies that serve the public, such as railroads and utility companies." Sometimes the government needs only an easement against private property, not title to it. If the private owners are unwilling to sell the government an easement, then an easement can be created by condemnation. The government will pay the owners for the easement rights, because the Constitution requires the government to compensate private owners for property taken by condemnation.

Release

"The holder of an easement may release his rights in the servient tenement. A written release is required; usually the dominant tenant executes a quitclaim deed in favor of the servient tenant, and the servient tenant records the deed. This would be accomplished with a written document, usually a quitclaim deed from the easement holder to the owner of the servient tenement."

Judgment

"The judge issues a decree" "The decree may order the losing party to pay a certain sum of money to the winning party. "

Beneficiary

"The lender or creditor"

Types of Liens

"The most common types of liens against real property include: -mortgages, -deeds of trust, -mechanic's liens, - judgment liens, -attachment liens, -tax & assessment liens"

Dominant tenant

"The owner of the dominant tenement"

Servient tenant

"The owner of the servient tenement"

Dominant tenement

"The parcel with the benefit"

Judgment creditor

"The party who wins a money judgment is entitled to a judgment lien against the property of the losing party" The judgment creditor is entitled to an involuntary, general lien against real property belonging to the judgment debtor. If the debtor doesn't pay the judgment, the creditor can foreclose on the property.

Profits

"The right to take something away from land that belongs to someone else." A profit is a nonfinancial encumbrance, an interest in real property. "For example, it might be the right to take timber, peat, or gravel from someone else's land. The difference between a profit and an easement is that the easement is just a right to use another's land, but a profit allows the removal of something from the land. A profit must be created in writing or by prescription."

Claim of Lien

"To establish a mechanic's lien, the claimant must record a claim of lien. The deadline for recording a claim of lien varies, depending on whether or not the property owner has recorded a notice of completion or cessation."

Foreclosure - Mechanic's lien

"To foreclose on a mechanic's lien, the lienholder must file a court action within 90 days after the lien was recorded. Otherwise, the lien automatically becomes void and has no further force or effect."

Attachment Liens

"Valid for three years and is renewable. Involuntary lien In a lawsuit, the plaintiff may request an attachment lien against the defendant's property. The lien prevents the defendant from selling the property during the trial to avoid paying any judgment the plaintiff might win. (Note that attachment liens are available only in certain types of lawsuits.)" "When someone files a lawsuit, there is a danger that by the time a judgment is entered, the defendant (the party sued) will have sold his property and disappeared, leaving the other party with little more than a piece of paper. To prevent this, the plaintiff (the person who started the lawsuit) can ask the court to issue a writ of attachment for specified real property owned by the defendant. (Attachment creates a specific lien, not a general lien like a judgment lien.) The writ is recorded in the county where the property is located and creates an involuntary, specific lien against the property. "

Trespass

"Violating the neighboring owner's rights of possession" "There is a three-year statute of limitations on court actions for trespass on real property. That means that a property owner must file suit within three years of the time he discovered (or should have discovered) an encroachment, or the right to sue for damages or the removal of the encroachment will be lost."

Reference to a Recorded Plat

"When a landowner subdivides her property and records a plat map, the lot purchasers acquire easements to use all the roads and alleys shown on the plat."

Attach to the property

"When a lien becomes legally effective"

Notice of completion

"When a project has been completed, the property owner has ten days in which to file a notice of completion for recording"

Merger

"When both the dominant and servient tenements are acquired by one owner, resulting in termination of the easement." "Since an easement is, by definition, the right to make a certain use of another person's land, if the dominant and servient tenements come to be owned by the same person, the easement is no longer necessary and therefore is terminated. This is called merger; ownership of the dominant tenement has merged with ownership of the servient tenement."

Lis pendens

(Action pending- Latin) "When a lawsuit that may affect title to real property is pending, the plaintiff may record a document called a lis pendens" "is NOT a lien, anyone who purchases the property identified in the lis pendens has constructive notice of the pending lawsuit and therefore will be bound by any judgment that results from the suit, even though that person is not a party to the lawsuit. Because of this notice, the new owner would be bound by any judgment resulting from the lawsuit. A lis pendens remains effective until the lawsuit is dismissed by the parties, until the court's judgment is rendered, or as long as the court action is pending. If the need for the lis pendens disappears before the lawsuit is concluded, the lis pendens may be removed by the person who originally recorded it."

Easements Appurtenant

(Appurtenant easement) "An easement appurtenant "runs with the land." Burdens one parcel of land for the benefit of another parcel of land" In other words, it ordinarily continues to exist even after title to either of the properties changes hands. Once the easement is established, the benefit and burden are automatically passed on to all subsequent owners of the dominant and servient tenements, regardless of whether or not the easement is mentioned in the deed that transfers ownership. "The most common type of easement appurtenant is one that gives a property owner the right to cross a neighbor's land to reach her own land" " This type of easement is sometimes called a right of way or an easement for ingress and egress (entering and exiting)" "An easement that benefits a parcel of land is called an easement appurtenant because it goes along with ownership of the land like other appurtenances (air rights, for example). The easement is appurtenant to the dominant tenement"

Covenants, conditions, & restrictions

(CC&Rs) Private restrictions are ordinarily interpreted as covenants, which are contractual promises. If a property owner violates a covenant, a judge may issue a court order directing the owner to stop the violation or pay money damages, or both. But title to the property can't be forfeited. "Private restrictions most subdivision developers impose a list of restrictions on all lots within the subdivision, before they begin selling individual lots" "Intended to ensure that the subdivision will remain a desirable place to live."

Mechanic's Liens

(Construction liens or materialman's lien) A involuntary, specific lien. The priority of a mechanic's lien is determined by the date work began on the construction project. Can be claimed by someone who provides labor or materials for improvements on real property Attaching only to the property where the construction work was performed "A lien on property in favor of someone who provided labor or materials to improve it." "A person who provides labor, materials, or professional services for the improvement of real property may be entitled to claim a mechanic's lien against the property. For example, if a plumber who is involved in remodeling a bathroom isn't paid, she can claim a lien against the property for the amount owed. Eventually, if necessary, the plumber could foreclose on the lien, forcing the property to be sold to pay the debt. A mechanic's lien is a specific, involuntary lien, attaching only to the property where work was performed or materials were supplied. Mechanic's liens are sometimes called construction liens. A mechanic's lien claimed by someone who provides materials (as opposed to labor) is sometimes called a materialman's lien." "Many improvement projects involve a complex hierarchy of contractors, subcontractors, laborers, and materials suppliers, all of whom may be entitled to claim liens. However, before a mechanic's lien can be successfully created, the lien claimant must comply with numerous statutory requirements."

Implication

(Easement by necessity) (Implied Easements) (Easement by Implication) "An easement created automatically because it is necessary for the enjoyment of the benefited land" Can be either an implied grant or an implied reservation. This type of easement can arise only when a property is divided into more than one lot, and the grantor neglects to grant or reserve an easement on one lot for the benefit of the other. The easement is implied by law instead." "There are two requirements for an easement to be created by implication: 1. it must be reasonably necessary for the enjoyment of the property, 2. there must have been apparent prior use. The "apparent prior use" requirement ensures that the owner of the servient tenement had good reason to expect that the owner of the dominant tenement would use the existing access route for ingress and egress. The second requirement is fulfilled if the use was established before the property was divided, and would have been apparent to prospective purchasers from an inspection of the property."

Secured creditor

(Lienholder) The lienholder is one of the owner's creditors. "A creditor who has a lien against (a security interest in) the debtor's property is called a secured creditor or a lienholder." A secured creditor is in a much better position than an unsecured creditor. Without a lien, if the debt isn't paid, the creditor has only the right to sue the debtor. And in many cases a lawsuit doesn't help the creditor, because the debtor has no money or other assets left.

Financial encumbrance

(Liens) It is a security interest that gives the lienholder the power to foreclose, forcing the sale of the property so that the debt can be paid. A lien is either voluntary or involuntary, and either specific or general. A lien is a financial encumbrance because the person who holds a lien (the lienholder) has a financial claim against the property owner. Affects title to property only -Mortgages -Deeds of trust -Mechanic's liens -Judgment liens -Attachment liens -Property tax liens -Other tax liens "It gives a creditor the right to foreclose and use the sale proceeds to pay off the debt."

Easement by Prescription

(Prescriptive easement) Is created through long-term use of land without the permission of the landowner. Acquiring an easement by prescription is similar to acquiring ownership through adverse possession. An easement by prescription must meet the following requirements: 1.the use must be open and notorious (apparent to the landowner); 2. the use must be hostile (without the permission of the landowner); 3. the use must be reasonably continuous for at least five years; 4. the use must be under some claim of right; and 5. if property taxes are assessed separately against the easement, they must be paid by the easement claimant for the five-year period

Involuntary liens

(Statutory liens) "A security interest given to a creditor by operation of law." Are given to creditors without the property owner's consent, by operation of law. Examples of involuntary liens are property tax liens and judgment liens."

Deeds of Trust

(Trust deed) Voluntary lien Specific lien that makes the property security for a loan The most significant difference between mortgages and deeds of trust is in the foreclosure process." "Used for the same purpose as a mortgage. However, there are three parties to a deed of trust rather than the two found in a mortgage transaction. The borrower is called the trustor; the lender or creditor is called the beneficiary; and there is an independent third party (often an attorney or title insurance company) called the trustee.

Creating an Easement

(Whether appurtenant or in gross) Can be created in any of the following ways: -express grant, -express reservation, -implication, -prescription, -reference to a recorded plat, -dedication, -condemnation

Private Restrictions

(deed restrictions or restrictive covenant) Are restrictions on the use of a property that were usually imposed by a previous owner. Like easements, private restrictions can "run with the land," binding all subsequent owners of the property" "While restrictions are often imposed in a deed, they can also be created by written agreement between the current property owner and a neighbor or some other party. This type of restriction can also run with the land and be binding on all future owners. Most subdivision developers impose a list of restrictions on all lots within the subdivision, before they begin selling individual lots. This is called a declaration of restrictions, or CC&Rs (covenants, conditions, and restrictions). The CC&Rs typically include rules limiting all the lots to single-family residential use, requiring property maintenance, and preventing activities that would bother the neighbors. The rules are intended to ensure that the subdivision will remain a desirable place to live. The CC&Rs are recorded, and then referenced in the deeds used to convey the lots in the subdivision. As long as a private restriction isn't unconstitutional, in violation of a law, or contrary to a judicial determination of public policy, it can be enforced in court. (An example of an unenforceable restriction is one prohibiting the sale of property to nonwhite buyers)" Another example of an illegal private restriction is one that prohibits property owners from putting up "For Sale" signs. Courts have typically ruled that any restrictions on "For Sale" signs are void.

11. The creation of an easement by prescription is similar to acquiring ownership of property by: A. adverse possession B. escheat C. alluvium D. intestate succession

A. adverse possession

7. You have the right to cross another's land to get to your house. You probably own a: A. dominant tenement B. servient tenement C. Both of the above D. Neither of the above

A. dominant tenement

3. A recorded document that informs potential buyers that the property may become subject to a judgment in a lawsuit is a: A. lis pendens B. writ of execution C. writ of attachment D. habendum clause

A. lis pendens

Terminating an Easement

An easement can be terminated in any of the following ways: 1. release, 2. merger, 3. failure of purpose, 4. abandonment, or 5. prescription

Dedication

An easement is created by dedication if a private owner donates easement rights to the government. Long-term public use can result in implied dedication, and the government won't be required to compensate the private owner. "A private landowner may grant an easement to the public to use some portion of his property for a public purpose, such as a sidewalk. The dedication may be expressly stated, or it may be implied." If the dedication is voluntary, the easement should be put into writing and recorded. But dedication sometimes occurs involuntarily, by implication. If the public makes use of private property over a long period without the owner's permission, an easement may be created by implied dedication. For example, this might happen if an owner fails to stop the public from fishing or hunting on his land.

13. A porch or balcony that hangs over the established boundary line of a parcel of land is called: A. an easement in gross B. an encroachment C. an easement appurtenant D. a license

B. an encroachment

12. A has an easement over B's property. If A buys B's property, the easement is: A. abandoned B. terminated by merger C. unaffected D. None of the above

B. terminated by merger

5. If there were two deeds of trust against the same property and you needed to know which one had higher priority, you could find this information by checking the county records. The priority is usually established by: A. the printed deed of trust forms, which have the words "first deed of trust" and "second deed of trust" on their face B. the date and time of recording C. the county auditor's stamp, which says "first deed of trust" or "second deed of trust" D. the execution date of each document

B. the date and time of recording

4. Which of the following has priority over a mortgage that has already been recorded? A. A deed of trust B. A judgment lien C. A property tax lien D. None of the above

C. A property tax lien

2. A lawsuit against Thatcher is pending. The court rules that a lien should be placed on his farm, holding it as security in case of a negative judgment. This is: A. adverse possession B. prescription C. an attachment D. an easement

C. an attachment

6. When there's an easement appurtenant, the dominant tenement: A. can be used only for purposes of ingress and egress B. is burdened by the easement C. receives the benefit of the easement D. cannot be sold

C. receives the benefit of the easement

9. Unlike a license, an easement: A. is not an encumbrance B. is considered a possessory interest in real property C. runs with the land D. can be revoked by the owner of the servient tenement

C. runs with the land

Mortgagee

Creditor

8. An easement in gross benefits a: A. dominant tenement B. servient tenement C. Both of the above D. Neither of the above

D. Neither of the above

10. Which of the following is not a method of creating an easement? A. Implication B. Express grant in a deed C. Dedication D. Spoken grant

D. Spoken grant

14. All of the following would be considered nuisances, except: A. fumes from a paper mill B. a house with regular drug-dealing activity C. radiation from a microwave tower D. a garage built on top of the property line

D. a garage built on top of the property line

1. Real estate property tax liens are: A. general, involuntary liens B. general, voluntary liens C. specific, voluntary liens D. specific, involuntary liens

D. specific, involuntary liens

Ingress & egress

Entering & exiting

Abstract of judgment

General Lien "The party who wins a money judgment is entitled to a judgment lien against the property of the losing party. The lien is created by recording a document called an abstract of judgment."

Foreclosure

If the owner doesn't pay off the debt owed to the creditor, the security interest allows the creditor to force the property to be sold, so that the creditor can collect the debt out of the sale proceeds" If the owner fails to pay the debt, the lien allows the creditor to foreclose.

Judgment Liens

Involuntary, General Lien Held by someone who was awarded a judgment in a lawsuit It attaches to all of the judgment debtor's property in the county or counties where an abstract of judgment has been recorded. "When a lawsuit is decided by a court" "A lien held by someone who has won a judgment in a lawsuit, attaching to property owned by the person who lost the lawsuit." "A judgment lien is an involuntary, general lien. It attaches to all of the real property owned by the debtor in any county where the creditor records the abstract of judgment. The lien will also attach to any additional real property that the debtor acquires during the lien period (the length of time the judgment creditor has to take action on the lien). In California, a judgment lien ordinarily lasts for 10 years after the judgment was entered in court records." During the lien period, if the debtor acquires additional property, the lien can also attach to that new property. If a judgment isn't paid and the lienholder decides to foreclose, the court will issue a writ of execution, ordering that the debtor's property be sold to satisfy the judgment. "Once a judgment lien has attached, the debtor must pay the judgment to free the property from the lien. If it's not paid, the judgment creditor can foreclose, and the property will be sold by a designated official to satisfy the judgment. To order the sale, the court issues a writ of execution."

Condition

Ownership of the property depends on compliance with the restriction. Someone who violates a condition may actually forfeit title to the property. "A restriction on the use of land, the violation of which may result in forfeiture of title" "A condition in a deed makes the grantee's title conditional, so that he owns a fee simple defeasible rather than a fee simple absolute. Breach of the condition could result in forfeiture of title."

Servient tenement

Parcel of land with the burden

Mortgagor

Property owner

Trustor

The borrower

Tenement

The land

Tenant

The landowner

Judgment debtor

The losing party