Chapter 2: Property Ownership and Interest
Ron sells his old house. He and wife Deb take title to a new house. The deed does not indicate this ownership specifically as a tenancy by the entirety, however. What percentage of the interest in the new house does Deb own?
100%
Same scenario: Karen and Sue buy a $200,000 house together. Karen puts up $150,000, and Sue puts up $50,000. The deed indicates that Karen owns a 75% interest, and Sue owns a 25% interest. How much of that property can Sue occupy? (Tenancy in Common)
100%
Mary, Donna, Ralph, and Lou co-own a property as joint tenants. Ralph dies. What is Mary's interest in the property?
33 1/3%
Let's walk through a little case study. Karen and her sister Sue buy a $200,000 house together. Karen puts up $150,000, and Sue puts up $50,000. The deed simply indicates that the grantees are Karen and Sue as tenants in common. Sue's interest in the house is MOST LIKELY (Tenancy in Common)
50%
Lizzy and Emma buy a $100,000 vacation cottage together. Lizzy makes a $25,000 down payment, and Emma takes out a $75,000 mortgage. The deed simply states the ownership as "Lizzy D. and Emma K. as tenants in common." What is Emma's interest in the house?
50%
How long does a condo purchaser have to exercise his right to cancel the purchase contract?
7 days
Possessory Interest
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
Attaching personal property to land so that the law views it as part of the real property.
Which of these estates is NOT inheritable?
Bart is the life tenant of a conventional life estate.
A "notice of pending litigation" to inform potential homebuyers that a property is in a pending lawsuit that will affect title to the property is called a writ of attachment.
False
A creditor who files a lien has the right to occupy the property until the lien is repaid.
False
An example of an easement appurtenant would be an easement that grants access across a parcel of land to a public beach.
False
Bride Deb moves into the house Ron owned prior to the wedding. The unities that are present with respect to the ownership of the house are interest, time, and title only, not possession or person.
False
Colin is setting up a trust for his grandchildren. He is the trustor and his grandchildren are trustees.
False
Condominium bylaws may stipulate what color decorative lights an owner can use on a condo's exterior.
False
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
Dower and curtesy rights apply in the state of North Carolina.
False
Lara owns a condominium. When a candle catches her draperies on fire, the damage to Lara's carpet, walls, and furniture is covered by the condominium association's hazard and liability insurance.
False
Like a lien, an easement is a nonpossessory interest in real property and is a financial encumbrance.
False
Manufactured housing is a type of factory-built housing that is automatically considered real property once it is constructed onsite.
False
Marcia, Jan, and Cindy own a 12-acre lot as joint tenants. They agree to partition the lot into three separate lots. Now each woman owns an undivided interest in four acres.
False
Opal lives in a co-op, and she does not pay the required assessment. The other owners in the co-op can put a lien on her unit.
False
Property tax on a cooperative building is levied against individual unit owners.
False
Reliction is the gradual process of waterborne silt being deposited in a river, lakebed or on a shore.
False
Ron and Deb just got married, and Deb moves into the house Ron owned prior to the wedding. Ron and Deb automatically own the house as tenants by the entirety.
False
The gas company's easement in gross is a negative easement.
False
Trees, shrubs, perennials, and naturally occurring vegetation are part of the land and therefore are considered personal property.
False
When Tiffany opened a cupcake shop in a strip mall, she installed four commercial ovens. At the end of her three-year lease, Tiffany vacates the property, leaving the ovens behind. She can send a bill to the landlord for the depreciated value of the ovens.
False
Heather, Yvonne, Kim, and Rita co-own a property as joint tenants. Rita, Kim, and Yvonne are killed in a car accident. What is Heather's interest in the property?
Heather owns the property in severalty.
Karen and Sue's deed indicates that Karen owns a 75% interest, and Sue owns a 25% interest. Which unity is NOT present in this arrangement? (Tenancy in Common)
Interest
Ann and Bob each own a one-third interest in a property as joint tenants. Dave owns a one-third interest in the property as a tenant in common with Ann and Bob. When Bob dies, what happens to his interest in the property?
It goes to Ann, who now has a two-thirds interest.
Trustor Harold makes daughter Jan the trustee of some rental property for the benefit of grandson Mike. Who holds title to the property?
Jan
The best way for real estate brokers to mitigate chances of marketability issues with title to real property due to encroachments is by recommending clients order a(n)
Land survey
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
Jill conveys a small farm house to her nephew, Jim. Jill knows that Jim will inherit a larger property when his father Mack dies. So, Jill conveys the small farm to Jim for as long as Mack lives. In this situation, who is the measuring life?
Mack
Fructus Naturales
Naturally occurring plants ("fruits of nature"), generally considered part of real property. Also called natural attachments.
Ellen is granted a conventional 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
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
You don't pay a special assessment tax that was imposed to pay for new street lights in your neighborhood because you thought that the existing light was sufficient. Will the city ask your permission to put a lien on your property to cover that assessment?
No
Two months later, Marcia is sued for nonpayment of a credit card debt and a judgment lien is recorded against her. What are the current priority positions of the liens in the event she defaults on all of her obligations?
Of the liens listed here, the mechanic's lien is superior and takes first priority, followed by the mortgage lien, since it was recorded before the judgment lien.
Opal lives in an apartment that is going co-op. The current residents are given the first option to buy in, and Opal decides to take advantage of the opportunity. Which statement about Opal's new co-op is FALSE?
Opal will own the airspace inside her co-op.
Which statement about a life estate is FALSE?
People deeding property to someone cannot take a life estate for themselves.
Which of these unities is NOT required for there to be joint tenancy?
Person
The city assesses a specific tax to replace the curbs and lights on Marcia's street, and she ignores the tax bill. The city files a lien. Of the four liens on Marcia's property, which is in first priority?
Special assessment
Rachel wants to make sure that her disabled son, Earle, has a place to live when she dies. She also wants to give the property to her daughter, Jane, after her son passes away. If Earle is still alive when Rachel dies, who will own the property and what is that person called?
The owner of the property will be Jane, and she is the remainderman.
Emblements are considered personal property.
True
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
Harvested corn is an emblement.
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
Marcus owns a cottage on the lake. When he sells the cottage, his littoral rights are automatically transferred to the new owner.
True
Restrictive (protective) covenants are private deed restrictions that limit how land may be used.
True
When a condo unit is sold, an undivided interest in common areas and membership in the owners association are automatically transferred to the new owner.
True
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
Jessica sells her condominium unit to Roger. Does Roger also get an undivided interest in common areas and membership in the owners association?
Yes
Same example, but instead, the specific deed language is, "My niece and her heirs may have the land as long as 10 acres remain 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
Which is an example of a negative easement?
Your neighbor is unable to add a second story to his house if it blocks your sunlight.
Encroachment
a physical object intrudes onto neighboring property, often due to a mistake with the boundary.
The acquisition of title to land by its addition to real estate already owned, through human actions or natural processes is called
accession.
You live next to a coastal inlet. Over the last several years, the tide has been depositing silt into the inlet, adding land to your property. This is an example of
accretion.
Barbie and Ken own their home as tenants by the entirety. After 50 years together, they decide they are not compatible and get a divorce. The divorce is final before they can sell their dream house. This property is owned by Barbie and Ken
as tenancy in common
A large mirror that a buyer wants to remain with the property should
be identified as a fixture in the sales contract.
Which element CANNOT be separated from real property?
bundle of rights
When Jason bought Lauren's house, she turned over the house keys as part of the transaction. The house keys have become real property through the process of
constructive annexation.
Matilda wants to know that her granddaughter Rose will inherit her house when she dies. So, she deeds her house to her granddaughter but creates a situation where Matilda can still live in the house until she dies. When Matilda dies, Rose will own the house. What kind of estate is this?
conventional life estate
Of these, which estate is NOT inheritable?
conventional life estate
Jean gives 20 acres to the city of Edgewood but stipulates that the city can use it only to create a nature preserve and park. If the city uses the land for any other purpose, it will revert to Jean's heirs. What kind of estate has Jean created?
defeasible fee simple
Jacob and Jeremy share part of a driveway. To ensure that each can enjoy use of the driveway and share the maintenance costs, they most likely have what type of easement?
easement by agreement
Heather owns a property on the shore. The guest house is on the beach, and the main house is up a hill above the beach. She sells the guest house to Tom. After the sale, she continues to use the gate between the main house and the beach house to cross Tom's property and access the beach. This would most likely be considered
easement by implication.
Henry buys a retirement home in the mountains. He never really got along with his son Mario, but he really likes Mario's wife, Joan. After Mario gets a divorce, Henry changes his will so that Joan inherits the house when he dies. What type of estate does Henry have?
fee simple absolute
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
Which of these is real property?
fructus naturales
Marcia has four liens: $3,000 for the city-installed curbs, $2,000 for Tim the digger, $150,000 on her mortgage, and $12,000 judgment for credit card debt. The bank forecloses, and the house sells for $152,000. How do you think the money will most likely be distributed?
in order, so $3,000 to the city; $2,000 to the digger; $147,000 to the bank; $0 to the creditor
Which is NOT a legal right of a life tenant?
income from cut timber
Which type of co-ownership requires ONLY the unities of possession, interest, time, and title?
joint tenancy
A landlord installs a wood-burning stove in the living room of a single-family home for the tenant's use. At the end of the lease, the stove is the property of the ________ and is ________ property?
landlord / real
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
You live in a house on the shores of a commercial lake. You are a ________ owner, which means that you ________ own the land under the water.
littoral / don't
Which type of life estate is created by operation of law?
marital only
Brian has an appurtenant easement that allows him to cross over his neighbor's land to get to the lake. When the neighbor sells this land to Brian, the easement is terminated through
merger
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 rights is NOT being violated?
mineral
Which type of factory-built home is automatically considered real property once it is constructed onsite?
modular housing
Real property consists of all of the following EXCEPT
movable items not fixed to the land.
Lisa owns a condo, which means she owns in severalty, the interior
of her unit only.
Josh and Reva, husband and wife, own their home as tenants by the entirety. When Josh dies, Reva automatically becomes sole owner. What type of property ownership has this become?
ownership in severalty
Lenny and Eileen just got married, and she moves into the house Lenny owned in severalty prior to the wedding. Which of these unities is present concerning the ownership of the house?
person
Which unity is NOT required for joint tenancy?
person
Opal lives in a co-op. Her interest in the co-op is
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
Which of these unities is required for there to be a tenancy in common?
possession
Appurtenances
rights that transfer with real property, or "run with the land."
John owns property on the Mississippi River, which gives him ___________ to the __________ of the water.
riparian rights / edge
Which transaction does NOT represent an example of an appurtenance?
selling the fructus industriales grown on your land
The gas company has an easement in gross to access its gas lines on the
servient tenement.
Larry owns his house in severalty. He has a will that leaves the house to his grandson, Sean. When Larry dies, Sean is ________ and his interest was created by ________.
sole owner / devise
When Dave and Lucy get married, they decide to sell each of their homes and buy one house together. Lucy's house sells for $700,000; Dave's house sells for $300,000, and they're going to buy a $1 million house. If Lucy wants a 70% interest in the new house, what form of ownership must they take?
tenancy in common
Ken included provisions in his will that upon his death, his three children will each receive a lump sum of money on their 30th birthday. What type of trust this?
testamentary trust
Julie is applying to live in Hoity Toity Tower. Assuming no illegal discrimination, she could be rejected if
the co-op board decides not to approve her application.
Which is an example of an appurtenance?
the right to lease the space over your land for a billboard