Ch 2 Property Ownership and Interests
lis pendens
"a lawsuit pending." notice of pending litigation whose outcome potentially will affect title to all or part of a new owners property
pur atre vie
"for the life of another" a life estate measured by the life of someone other than the life tenant
In North Carolina, what is the rescission period for the purchase of a new timeshare? A 5 calendar days B 5 business days C 7 calendar days D 7 business days
5 calendar days In North Carolina a purchaser of a timeshare has a five calendar day rescission period. Rescission periods are always calendar dates, not business or banking days.
In North Carolina, what is the rescission period for the purchase of a new condominium? A 3 calendar days B 5 calendar days C 7 calendar days D 10 calendar days
7 calendar days The purchaser of a condominium has a seven calendar day rescission period in North Carolina.
encumbrance
A claim, charge, or liability that attaches to and is binding on real estate.
A person who acquired ownership that can be inherited, with the provision "that the land must always be used for recreational purposes," has: A) a fee simple absolute estate B) a defeasible fee C) a fee simple to a condition subsequent estate D) an estate that cannot be sold
A defeasible fee (a defeasible fee is a transfer of real property that is subject to a condition)
joint tenancy
A form of co-ownership that includes the right of survivorship.
cooperative
A form of ownership in which stockholders in a corporation occupy property owned by the corporation under a lease.
condominium
A form of ownership of real property recognized in all states that consists of individual ownership of some aspects and co-ownership in other aspects of the property.
life estate
A freehold estate created for the duration of the life or lives of certain named persons; a non-inheritable estate.
judgement lien
A general lien resulting from a court decree
mineral lease
A nonfreehold (leasehold) estate in the area below the surface of land.
easement
A nonpossessory right of use in the land of another.
Which of the following is generally considered real property? A) emblements B) trade fixtures C) a shrub planted in a decorative pot D) a perennial shrub planted in the backyard
A perennial shrub planted in the backyard real property includes the land and all of the appurtenances that go with it. Emblements, the right of the previous owner to harvest crops through the current growing season is not considered part of the land. Both trade fixtures and the shrub in a separate container or pot are considered personal property and not part of the land
easement in gross
A personal right of use in the land of another without the requirement that the holder of the right own adjoining land.
reversionary interest
A return of title to the holder of a future interest, such as the grantor in a life estate not in remainder.
uniform commercial code
A standardized and comprehensive set of commercial laws regulating security interests in personal property.
encroachment
A trespass on the land of another as a result of an intrusion by some structure or other object.
severalty
A type of ownership or a estate in which only one person holds title to a piece of real property.
dower
A wife's interest in the real property of her husband.
The concept by which land would increase automatically along a river or stream is known has A) accretion B) littoral rights C) avulsion D) reliction
Accretion accretion is the gradual buildup of land along a river. It increases automatically because the land owner does not have to do anything to gain the increase. It is the opposite of erosion
hereditament
All the corporeal and incorporeal attributes of real estate that can be inherited
non-freehold estate
An estate (interest in land) of less than freehold (lifetime, ownership) i.e. rental property.
fee simple absolute
An inheritable freehold estate in land that is the greatest form of real property ownership
freehold estate
An interest in land of at least a lifetime and is therefore generally identified with the concept of title or ownership
Jason's property is adjacent to a navigable river in North Carolina and Jason wants to sell his property. Which of the following statements is true? A Jason can restrict the public from using that portion of the river that is next to his property B An owner can sell the property and retain his rights to access the river once it is sold C Jason's land ends at the center of the waterway D If Jason obtains proper permits and builds a dock on the river, the dock will automatically become owned by the public
An owner can sell the property and retain his rights to access the river once it is sold An owner may always except or reserve certain rights out of the bundle of rights
The owner of a house wants to fence the yard for a dog. When the fence is erected, the fencing materials are converted to real estate by: A) severance B) annexation C) immobility D) indestructibility
Annexation (this is the process of taking items of personal property and converting them to real estate. The fence materials were personal property. Once the fence was incorporated into the real estate it became part of the real property through the process of annexation.)
time share
Any right to occupy a property for five or more separated time periods over a span of five or more years.
Oil, gas, and other subsurface rights are generally considered to be: A) separate and part from the rights or interest in the real estate B) an item which can never be separated from the real estate and must transfer with the property C) items of personality which the owner can either include or exclude from the transfer D) be part of the real estate and it's bundle of rights and automatically transfer to a subsequent owner unless specifically reserved or excepted in the deed
Be part of the real estate and it's bundle of rights and automatically transfer to a subsequent owner unless specifically reserved or excepted in the deed
Which of the following would be considered real property? I. Electrical switch plate covers II. Gas logs attached to a fireplace A I only B II only C Both I and II D Neither I nor II
Both I and II Both of these items meet the total circumstances test and would be considered fixtures that are part of the real property and transfer with it.
The right to occupy a property for five or more periods of time involving five or more years is considered a: l. Timeshare ll. Interest in real property A l only B ll only C Both l and lI D Neither l nor ll
Both l and lI This is the definition of a timeshare. It is a right or interest in real property that is for five or more periods of time involving five or more years.
Which of the following statements is true? I. A life estate is a freehold estate. II. It is possible to have a freehold estate and a non-freehold estate on the same property at the same time. A I only B II only C Both I and II D Neither I nor II
Both | and || Freehold means ownership and a life estate is an ownership interest in real property. It is possible to have a property that is both owned and leased at the same time.
A business owner rents an empty building to use as an ice cream parlor. The tenant subsequently installs larger freezer units and several service counters. These additions: A) are considered permanent improvements to the property B) become the landlord's property once attached to the building C) can be legally removed by the tenant at the termination of the lease D) can only be removed by the tenant with the landlord's permission
Can be legally removed by the tenant at the termination of the lease these items are considered trade fixtures and as such remain personalty
tenancy in common
Co-ownership of property that does not include the right of survivorship
A woman wishes to donate a vacant lot that she owns in fee simple absolute to a hospital that is located next to her lot. An attorney prepares a deed that conveys the ownership of the lot to the hospital "so long as it is used for medical purposes." After the completion of the gift, the hospital will hold a: A) pur atre vie estate B) fee simple absolute estate C) defeasible fee D) fee simple to a condition subsequent estate
Defeasible fee (the property was transferred subject to a condition that the property only be used for medical purposes. Such a condition creates a defeasible fee which if violated will return ownership to the original grantor through reversion)
intestate succession
Distribution of property by descent as provided by statute.
A woman conveys a life estate to her son-in-law and stipulates that upon his death the estate will pass to her grandson. The grandson has an: A) estate in reversion B) estate in remainder C) estate pur autre vie D) estate for the life of another
Estate in remainder (at the termination of a life estate the interest in the property can be transferred back to the grantor in which case it is a reversionary life estate. If the interest is transferred to anyone other than the grantor it is called a remainder interest. Here the property is not returning to the original grantor, but instead is passing to her grandson who has a remainder interest.)
Which of the following has an indefinite ownership period? A) fee simple estate B) life estate C) estate for years D) estate at will
Fee simple estate A fee simple estate, also known as a "fee" is the highest and best form of ownership. The owner possesses all of the rights or interests and the ownership lasts forever, therefore it is considered indefinite.
The phrase "bundle of legal rights": A) is part of the definition of real property B) is another name for a legal description C) refers to the legal documents D) refers to the tenant's right in a lease
Is part of the definition of real property the transfer of real property includes the transfer of a bundle of rights, including all of the rights, interests, and appurtenances that are part of the property. These are referenced by the acronym DEEPC, disposition, enjoyment, exclusions, possession, and control
Jack is not married and buys a vacant lot as his sole and separate property. Jack later married Jill and they buy a house together. How is the ownership of the vacant lot now classified? A Jack and Jill own the lot as tenancy by the entirety. B Jack and Jill own the lot as joint tenants. C Jack owns the lot in severalty. D They both own the lot and house as tenants in common.
Jack owns the lot in severalty. Ownership to property does not change due to the fact that someone got married. If an individual owns a property in severalty and gets married they still own the property in severalty.
north carolina condominium act
Legislation passed in 1986 that set requirements for the sale or resale of condominiums. Requirements include disclosure, right to rescind contract for seven days, special escrow rules, and timely provision of required documents.
Which of the following statement(s) is/are true regarding timeshares in NC? I. The NC Real Estate Commission can fine a timeshare broker for violations of the NC Timeshare Act. II. If there are violations of the NC Timeshare Act, the fine per violation is $1,000. A I only B II only C Both I and II D Neither I nor II
Neither | or || The North Carolina Real Estate Commission can never fine a licensee. They can fine the developer of a time share project and the maximum fine is $500.
leasehold estate
Nonfreehold estate; of limited duration, providing the right of possession and control but not title.
remainderman
One having a future interest in a life estate.
life tenant
One holding a life estate.
prescriptive easement
One obtained by open, continued, and uninterrupted use without the owner's permission
air rights
Ownership of and the rights to the area above the surface of the earth.
Emblements
Personal property growing in the soil that requires planting and cultivation. Annual crops. Also, the right of former owners to reenter property to cultivate and harvest annual crops that were planted by them.
fixture
Personal property that has become real property by having been permanently attached to real property (ceiling fan, shelves).
A trade fixture is considered: A) a fixture B) an easement C) personalty D) a license
Personalty typically fixtures are part of the real property and get transferred with the property. Trade fixtures are those items used in a trade and business and they remain personalty. This means the tenant may remove these items so long as they do so before the expiration of the lease
A person currently has the legal right to occupy and use a certain residential structure. The interest in the property could be all of the following, EXCEPT: A fee simple B remainder C leasehold D life estate
Remainder All of the other choices include a right to occupy the property. A remainder interest is a future interest which a person will acquire. It does not include a current right to occupy the property.
A deed conveyed ownership to a grantee "so long as the existing building on the property is not destroyed." Following the transfer, the original grantor has what type of interest? A) life estate B) ongoing ownership in the property that lasts as long as the condition C) fee simple estate D) reversionary estate
Reversionary estate (the original grantor no longer has an ownership interest. All ownership is with the grantee who holds a defensible fee subject to the condition. The original grantor does have a right to regain the property if the condition is violated. That future right or interest of the grantor is called a reversionary interest.)
Real property can become personal property by: A) severance B) purchase C) hypothecation D) attachment
Severance the act of permanently attaching personal property and transforming it into a fixture is called annexation. The act of turning real property into personal property is called severance. A good example would be the trees growing on the property which are considered real property. Severance occurs when they are cut down and severed from the property and they become firewood which is personal property
A seller is under contract to sell a property using the standard offer to purchase and contract. The elegantly decorated master bedroom has vertical window blinds, hand-painted light switches and electrical outlet covers and draperies fashioned from fabric coordinated with the wallpaper. Which of the following items may the seller legally remove before the close of the transaction? A) none of the items B) the draperies and blinds C) the hand-painted light switches and electrical outlets D) the draperies
The draperies parties to a transaction are able to specifically contract for certain items to either transfer or remain with the property. The standard NCBA/NCAR purchase contract considers and lists all of the other items as fixtures which are to remain with the property.
condemnation
The exercise of the power of eminent domain. The taking of private property for public use by paying just compensation.
foreshore
The land between high and low watermarks.
escheat
The power of government to take title to property left by a person who has died without leaving a will or qualified heirs.
estovers
The right of a life tenant or lessee to cut timber on the property for fuel or to use in making repairs
lateral support
The right of land to be supported in its natural state by adjacent land.
survivorship
The right of the surviving co-owner(s) to receive automatically a deceased co- owner's title of property immediately without probate,
riparian rights
The rights of an owner of property adjoining a watercourse such as a river, including access to and use of the water.
bundle of rights
The rights of an owner to possess, control, enjoy, sell, lease, mortgage, and dispose of the property.
littoral rights
The rights of owners bordering large bodies of water such as oceans to access of that water body.
When two people who own property under tenancy by the entirety sign a formal separation agreement, which of the following statements is correct? A The ownership changes immediately to tenancy in common. B The ownership changes immediately to joint tenancy. C The ownership must be determined by a court of law. D There is no change in the form of ownership at this time.
There is no change in the form of ownership at this time. Since the couple is still legally married, the form of ownership does not change with a separation. Tenants by the entireties would end if they are divorced, deceased or if they voluntarily chose to hold title in another manner.
Five days after signing a contract to purchase a new timeshare, the buyer backs out of the deal. How long does the developer have to refund the purchaser's money? A He has no obligation to return it, as there is a contract. B Thirty days from the date of purchase contract. C Thirty days from the date of cancellation. D Thirty days from the ten-day period in which these monies had to remain in the trust account.
Thirty days from the date of purchase contract. A timeshare developer has 30 days within which to refund the money if a timeshare transaction is rescinded and the 30 days runs from the date of the purchase contract, not the date of cancellation or rescission.
marital life estates
Those created by the exercise of the right of dower, curtesy, or a statutory substitute.
alienation
Transfer of title to real property
lien
a claim that one person has against the property of another for some debt or charge which entitles the lien holder to have the claim satisfied from the property of debtor
The owner of a condominium unit learns that a neighbor has failed to pay his condominium association dues. If the neighbor does NOT pay the dues: A a lien can be filed against the condominium complex B a lien can be filed against the neighbor's unit C a lien can only be filed against the common areas of the condominium D the taxing authority can order the condominium be dissolved
a lien can be filed against the neighbor's unit Unpaid condominium or HOA dues can become a lien against the property.
If a widow inherits an estate by will granting her the right of use and possession of a parcel of land for the rest of her life, with the provision that the estate will go to her children in fee simple upon her death, she has received: A an inheritable freehold estate B a life estate with remainder C a life estate our autre vie D none of the above
a life estate with remainder
townhouse
a unit within a housing complex where the owners own the unit and the land under the unit, HOA owns and maintains the common areas
A homeowner objected when a local utility company dug up his garden to install a natural gas line. The company claimed it had a valid easement supported by the county records. The homeowner claimed the easement was not valid because he was unaware of its existence. The easement was: A a valid easement in gross even though the owner did not know about it B a valid appurtenant easement owned by the utility company C not valid because the owner did not authorize the easement D not valid because the owner was not informed of its existence when he purchased the property
a valid easement in gross even though the owner did not know about it
an easement is terminated A when the purpose for which the easement was created ceases to exist B when the adjoining dominant and servant tenements are combined C by abandonment of the easement by the dominant owner D all of the above
all of the above
estate for years, estates from year to year, estates at will, and estates by sufferance A are leasehold estates B create a legal relationship between the parties of landlord and tenant C are non freehold estates D all of the above
all of the above
the items included as real estate is (are) A trees B fences C a built-in microwave D all of the above
all of the above
an example of an appurtenant easement would be A city water and sewer easement B easement for a neighbor friend to cross a nearby property to access the beach C an easement for the adjoining property to have a driveway over the subject property D a railroad right of way easement
an easement for the adjoining property to have a driveway over the subject property
which of the following is (are) correct A an easement provides a nonpossessory interest in land B the land on which an easement exists is the dominant tenement C the land that benefits from an easement is the servant tenement D all of the above
an easement provides a nonpossessory interest in land
estate
an interest in real property sufficient to give the owner of the estate the right to possession of real property
appurtenance
any right or privilege that is said to "run with the land." it transfers with title to the land
which of the following is a right in the property of another that results from ownership in a particular parcel of real estate A easement in gross B appurtenant easement C license D condemnation
appurtenance easement
easements may be created in all of the following ways except A condemnation B dedication C prescription D assessment
assessment
Chrissy owns property that borders a large, navigable lake that has tides. Her property ends: A at the mean high-water mark of the lake B at the lake border C at the center of the lake D five feet before the lake
at the mean high-water mark of the lake Littoral rights along large bodies of water that have tides extend ownership to the mean high water mark. In North Carolina the foreshore between high and low tides is public land.
Tenancy by the Entirety
co-ownership limited to husband and wife with the right of survivorship
all of the following involve ownership of real property except A cooperatives B condominiums C townhouses D time-shares
cooperatives
Which of the following best defines the ownership in a condominium? A divided fee simple interest in the unit and an undivided tenant in common interest in the common areas B a divided interest in the unit and a divided interest in the common areas C shared ownership rights of both the unit and the common area as tenants in common D separate interest in the unit with the association holding title to the common area
divided fee simple interest in the unit and an undivided tenant in common interest in the common areas This is the definition of a condominium. When purchasing a condominium an owner acquires a separate divided interest in their unit and an undivided interest in the common area as a tenant in common.
if a property owner gives a specific person permission to cross his property, this is a(n) A easement in gross B easement appurtenant C lease D encroachment
easement in gross
the creation of an easement by condemnation results from the exercise of which of the following A prescription B eminent domain C dedication D implication
eminent domain
Liens, easements, encroachments, and restrictive covenants are examples of which of the following A. emblements B. estovers C. estates D. encumbrances
encumbrances
which of the following is an estate that automatically renews itself for consecutive periods A estate at will B life estate C estate from year to year D estate for years
estate from year to year
the highest and best form of estate in real property is which of the following? A appurtenant easement B defeasible fee C life estate in reversion D fee simple absolute
fee simple absolute
Fructus Industriales
growing things on real estate that require planting each season (annuals, crops). considered personal property
Fructus Naturales
growing things that do not require planting or cultivation but grow naturally and are perennial (forest trees, shrubs). real property as long as attached to the soil
A brother and sister bought a commercial building and took title as joint tenants with right of survivorship. The brother died. The sister now owns the building: A as a joint tenant with right of survivorship with her brother's heirs B in severalty C as a tenant in common with her brother's heirs D as a life tenant with her brother's heirs having remainder interests
in severalty A right of survivorship means that at the death of one of the property owners, the remaining joint tenants will inherit the deceased persons interest in the real estate. Since the sister would not be the only surviving owner she will hold title to the property in severalty.
all of the following are examples of specific liens except A income tax liens B mortgage liens C mechanic's liens D real property tax liens
income tax liens
The owner of two acres of land sold one acre but retained an appurtenant easement over that land for ingress and egress to his retained lot. The retained lot: A is the dominant tenement B serves as the servient tenement C can be cleared of the easement when it is sold to a third party D is subject to an easement in gross
is the dominant tenement
time-share property in NC A must be for a residential use B is considered personal property C is the right to occupy a property during five or more separated time periods over five or more years D allows a bona-fide employee of the developer to sell the units without a real estate license
is the right to occupy a property during five or more separated time periods over five or more years
which of the following types of ownership requires unity of interest, title, time, and possession A cooperative B tenancy in common C joint tenancy D condominium
joint tenancy
partition
legal proceeding dividing property of co-owners so that each holds title in severalty to a specific portion of the property
a tenant in common A may sell her interest in the property B may pledge the entire property as security for a mortgaged loan C may not bring legal action to partition the property D has the right of survivorship in the property
may sell her interest in the property
Which item(s) listed below would be considered part of the "total circumstances test" to determine whether or not an item is a fixture? I. The value II. The size A I only B II only C Both I and II D Neither I nor II
neither | or || The total circumstances test, or IRMA uses the following factors to determine if an item is a fixture; intent, relationship, method and attachment. Cost, value and size are never factors in determining if something is a fixture.
an encumbrance always A has a positive effect on property value B has a negative effect on property value C is a lien D none of the above
none of the above
in the cooperative form of ownership A the owner owns his unit in severalty B each owner owns an interest in the common areas C the owners own the bolding as tenants in common D none of the above
none of the above
tenements
ownership interest in anything immobile and is considered part of the real property
a manufactured home that is towed to the land and placed upon a permanent foundation but still has the wheels, axles, and towing hitch attached will be considered A personal property B real property C an improvement D a fixture
personal property
police power
power of the government to regulate the use of real property for the benefit of public interest
new construction time-share properties in NC require A the developer to have a real estate license before sale are made B project registration with the commission before marketing the units for sale C all time-share salespersons must have a time-share license in NC D the purchaser to be given a right of rescission for 3 days from purchase
project registration with the commission before marketing the units for sale
all of the following are real property except A standing timber B underground minerals C readily movable items D naturally growing vegetation
readily movable items
Three joint tenants with rights of survivorship own a parcel of land. One owner sells his interest to a long-time friend. After the conveyance, the remaining original owners: A become tenants in common with each other B become tenants in common with each other and the newest owner C become joint tenants with the newest owner D remain joint tenants with each other
remain joint tenants with each other he original owners would still remain joint tenants because they meet the four unities of joint tenancy; time, title, interest and possession. People can always sell or transfer their interest prior to their death. The long-time friend who purchased the interest would become a tenant in common with the other owners.
The rights of the owner of a property located along the banks of a small stream are called: A) littoral rights B) subjacent rights C) riparian rights D) hereditaments
riparian rights (riparian water rights exist along rivers and streams. The rights along large bodies of water that are subject to tides are littoral rights)
personal property attached to real property is prevented from becoming real property by which of the following A value B an appurtenance C security agreement and financing D mineral rights
security agreement and financing
title held in the name of a corporation with many stockholders is considered to be held as A severalty B joint tenancy C tenancy in common D tenancy by entireties
severalty
Co-owners of a fee simple interest in a small office building are neither related to nor a creditor to each other. One owner dies intestate. The surviving owner would become the sole owner of the property under which of the following rights? A adverse possession B reversionary interest C survivorship D foreclosure
survivorship A surviving property owner acquires the interest of a deceased property owner when the property is co-owned with a right of survivorship.
the purchaser of a condominium time share A takes title for a specified time period (or periods) each calendar year B may not convey title to anyone else C has a 30-day right to rescind the purchase contract D all of the above
takes title for a specified time period (or periods) each calendar year
none of the following includes the right of survivorship in NC except A tenancy in common B tenancy by the entirety C life estate D joint tenancy
tenancy by the entirety
Vonda Lee and William purchased a home together in 2003 with the deed simply listing both of them as "grantees" without specifying how they were to hold title. They married each other in early 2004. How do they now likely hold title to the house purchased in 2003 if they have not made any other adjustments to their deed? A tenancy by the entirety B tenancy in severalty C joint tenancy D tenancy in common
tenancy in common Since they were not married at the time they acquired the property they could not have owned it as tenants by the entireties. They could have chosen various forms of ownership, however, in North Carolina the default position for unmarried people who do not otherwise specify a form of ownership is as tenants in common.
the purchaser of a condominium unit receives title to the land on which the condominium is situated as a A tenant by the entirety B tenant in common C joint tenant D tenant at sufferance
tenant in common
One of two owners holds an undivided 60% interest and the other holds an undivided 40% interest. The two owners probably hold their interest as: A cooperative owners B tenants by the entireties C community property owners D tenants in common
tenants in common tenants in common may hold different percentages of ownership in the property. Typically the share or interest of joint tenants must be equal, although in North Carolina that element of joint tenancy is not required.
The severalty owner of a parcel of land sells it. The buyer insists that the owner's wife also sign the deed. The purpose of obtaining the wife's signature is to: A terminate any rights the wife may have in the property B defeat any curtsey rights C provide evidence that the owner is married D subordinate the wife's signature to the buyer
terminate any rights the wife may have in the property It is possible for married people to own property and hold title in their own name without their spouse listed as an owner. However, because most states recognize some marital interest of a spouse in the property (even though their name does not appear on title) the spouse's signature will usually be required at the time of sale.
Ownership as tenants by the entirety includes which of the following? A the right of one owner to convey title to his share of ownership without the participation of the other owner B the right of survivorship C ownership of an unequal interest in the property with another D conversion to ownership as joint tenants if the owners are divorced
the right of survivorship
In order to create a joint tenancy relationship in the ownership of real estate, there must be unities of: A grantees, ownership, claim of right and possession B title, interest, encumbrance and survivorship C time, title, interest and possession D ownership, possession, heirs and title
time, title, interest and possession Joint tenancy requires four unities. All owners must come into ownership at the same time, through the same title or deed. They all have an equal interest in the property and they all have an equal right to possess the property.
co-ownership
title to property held by two or more persons at the same time (tenancy in common, tenancy by the entirety, joint tenancy)
a fee simple determinable A is an example of a non freehold estate B typically stipulates the conveyance is "as long as" it is used for a particular purpose C is an example of our auto vie (for the life of another) D is an example of freehold rights until the original owner's rights are determined to be invalid
typically stipulates the conveyance is "as long as" it is used for a particular purpose
which of the following statements regarding judgement liens is correct A judgement liens will not attach to property to which title is held by a husband and wife as tenants by the entirety unless both participated in the creation of the debt and are both names as defendants in the judgement B judgement liens have priority over the real property tax assessment C judgement liens have priority over all liens other than property tax liens D none of the above
udgement liens will not attach to property to which title is held by a husband and wife as tenants by the entirety unless both participated in the creation of the debt and are both names as defendants in the judgement
With regard to a tenancy in common, which of the following is true? l. Each tenant in common has an equal right to possession and use of the land. ll. The interest of all of the tenants in common must be equal. A l only B ll only C Both l and ll D Neither l nor ll
| only Tenants in common all have equal rights to possess and use the property. Their ownership rights do not have to be equal. They can own differing percentages of ownership.
