Module 3: Real Estate Law

In Oregon, the period of adverse possession is

10 years

In terms of basic physical characteristics, land is properly described as indestructible. nonhomogeneous. immobile. All of the above.

All of the above. The physical characteristics of real property are that real property is indestructible, immobile, and nonhomogenous.

Which would NOT transfer an interest in real property?

Bill of Sale A bill of sale is used to transfer an interest in personal property; a bill of sale is not used to transfer an interest in real property.

Which statement is true about Oregon water rights? Oregon is an appropriation doctrine state. Water rights are appurtenant.

Both A and B Water rights are appurtenant (they are an appurtenance); they run with the land. Oregon is a prior appropriation doctrine state, not a riparian doctrine state. Oregon's water laws are based on the doctrine of prior appropriation. ... Under the riparian doctrine, only landowners with water flowing through their property have claims to the water. By contrast, the prior appropriation doctrine is the basis of water law for most of the states west of the Mississippi.

Maria acquires a property from her uncle Alfonso. When Maria dies, the estate will pass to Alfonso's other niece, Serena. The type of estate that Maria has in the property is a

Conventional life estate. A conventional life estate is a freehold estate that is limited in duration to the life of the owner or other named person. Upon the death of the owner or other named individual, the estate passes to the original owner or another named party. A legal life estate is created by law as opposed to a property owner's choice.

A transaction is closed on September 20th of the tax year. The taxes are not yet due and nothing has been paid. How will the tax pro-ration appear on the closing statement?

Credit to buyer and debit to seller.

Enforceable subdivision restrictions may include which of the following? Prohibitions against the sale of properties in the subdivision to members of a minority group. Prohibitions against an incompatible use of property within the subdivision.

II only The prohibition against the sale of a property to a minority group would be a violation of Fair Housing. The prohibition against incompatible use is the only correct answer.

When a tenant in common dies, what happens to the tenant's interest in the estate?

It passes by probate to the deceased tenant's heirs. A deceased co-tenant's estate passes by probate to the decedent's heirs and devisees rather than to the other tenants in common. Any number of heirs can share in the ownership of the willed tenancy.

What is the primary purpose of a building permit?

It serves as evidence of compliance with municipal rules. The primary purpose of a building permit is as evidence of compliance with the local jurisdiction's rules.

Emily sells Rycole a property containing a deed condition. The condition stipulates that the forested portion of the property must never be razed for development. Three months later, Rycole proceeds to harvest the trees and turn the area into an executive golf course. What recourse, if any, does Emily have under the deed condition?

She has the right to re-possess the property because the grantee has violated the condition. A deed condition may restrict certain uses of a property, much like a deed restriction. However, violation of a deed condition gives the grantor the right to re-take possession of the property and file suit for legal title.

In the Rectangular Survey System, what are the dimensions of a township?

Six miles by six miles, or 6 miles square. A township is the area enclosed by the intersection of two consecutive meridians and two consecutive parallels. Since the parallels and meridians are six miles apart, a township is a square with six miles on each side. Its area is therefore 36 square miles. Remember to differentiate square miles from miles square: 4 square miles is a measure of area (2 miles x 2 miles); 4 miles square is a representation of the sides of a square (4 miles by 4 miles).

Which of the following is true regarding title insurance?

Subsequent buyers need to buy their own policy. Title insurance is coverage for the purchaser of the policy and is not transferable. Subsequent buyers will need to buy their own policy

An estate at will

Terminates on the death of lessor or lessee. The estate at will, also called a tenancy at will, has no definite expiration date and hence no "renewal" cycle. The landlord and tenant agree that the tenancy will have no specified termination date, provided rent is paid on time and other lease conditions are met. For example, a son leases a house to his father and mother "forever," or until they want to move. The estate at will is terminated by proper notice, or by the death of either party.

Melinda purchases a house and finances it. The lender in turn places a lien on Melinda's title. The lien in this mortgage transaction is

The creditor's claim against the property as collateral security for the loan. A lien is a creditor's claim against personal or real property as security for a debt of the property owner. If the owner defaults, the lien gives the creditor the right to force the sale of the property to satisfy the debt. For example, a homeowner borrows $5,000 to pay for a new roof. The lender funds the loan in exchange for the borrower's promissory note to repay the loan. At the same time, the lender places a lien on the property for $5,000 as security for the debt. If the borrower defaults, the lien allows the lender to force the sale of the house to satisfy the debt.

The giving of land by a developer for public use is called

dedication. When a developer gives land to the public for streets or another purpose it's called a "dedication."

What portion of a section is ten acres?

1/64. The size in acres of a subsection of a township is a fraction of 640 acres, since there are 640 acres in a section. Thus ten acres is 10/640, or 1/64th of a section.

In the Rectangular Survey System, a section contains how many acres? 40

640 Each side of a section is one mile in length. Thus the area of a section is one square mile, or 640 acres.

In accordance with the statute of frauds,

A five-year lease must be in writing to be enforceable. Generally, a lease for a period exceeding one year cannot be oral but must be in writing to be enforceable because of the statute of frauds.

If the duration of an owner's rights in an estate is not determinable, the owner has

A freehold estate. In a freehold estate, the duration of the owner's rights cannot be determined: the rights may endure for a lifetime, for less than a lifetime, or for generations beyond the owner's lifetime. By contrast, leasehold estates have expirations.

A property owner gives Deanna permission to cross his property as a shortcut to her kindergarten school bus. One day the property owner dies. What right was Deanna granted originally, and will it survive the owner's death?

A license, which terminates upon the owner's death. A license is a personal right that a property owner grants to another to use the property for a specific purpose (to reach the kindergarten school bus). Unlike a personal easement in gross, which terminates only on the death of the grantee, a license is revocable at any moment, is not transferable and does not attach to the land. It ceases on the death of either party, or on the sale of the property.

In a trust deed foreclosure the borrower can cure the default any time up to five days prior to the sale the borrower has a one-year right of redemption

A only In a trust deed foreclosure, the borrower (the trustor) can cure the default up until five days before the scheduled sale.

The right to control land usage by zoning and eminent domain is an example of

A public interest. Public entities may own or lease real estate, in which case they enjoy an estate in land. However, government entities also have non-possessory interests in real estate which act to control land use for the public good within the entity's jurisdiction. The prime example of public interest is police power, or the right of the local or county government to zone. Another example of public interest is the right to acquire ownership through the power of eminent domain.

Which of the following describes an encumbrance?

A third party's interest in a real property that limits the interests of the freehold property owner. An encumbrance is an interest in and right to real property that limits the legal owner's freehold interest. In effect, an encumbrance is another's right to use or take possession of a legal owner's property, or to prevent the legal owner from enjoying the full bundle of rights in the estate.

What is the difference between a variance and a nonconforming use?

A variance is granted by the zoning board if the owner has a justifiable reason. A nonconforming use is one that clearly differs from current zoning and is subject to change upon conveyance. A zoning variance allows a use that differs from the applicable ordinance for a variety of justifiable reasons.

A legal description of a property is one which

Accurately identifies the boundaries of the property as distinct from all other properties. A legal description of real property is one which accurately locates and identifies the boundaries of the subject parcel to a degree acceptable by courts of law in the state where the property is located. The general criterion for a legal description is that it alone provides sufficient data for a surveyor to locate the parcel. A legal description identifies the property as unique and distinct from all other properties.

A real property interest that includes the right to possess is considered

An estate in land. Interests are principally distinguished by whether they include possession. If the interest-holder enjoys the right of possession, the party is considered to have an estate in land, or, familiarly an estate. Freehold and leasehold estates in land are further distinguished by whether the duration of the owner's rights can be determined.

Which of the following best describes the legal concept of personal property?

Any item of property that is not definable as real property. Personal property is any owned item which is not real estate, and the rights associated with owning the personal property item. Items of personal property are also called chattels or personalty.

Trade fixtures: are intended to remain the property of the tenant. may be removed at the end of the lease if not prohibited in the terms of the lease.

Both A and B Trade fixtures are generally considered to be the personal property of the tenant and can be removed by the tenant at the expiration of the lease unless otherwise agreed in the terms of the lease.

A drifter secretly lives in an abandoned shack on a large ranch property. After twenty years, the person makes a claim of ownership to the shack and the land immediately surrounding it that he had cleared. This claim will likely be

Declined because possession was secretive. ' One of the preconditions for a claim of ownership based on adverse possession is notorious possession, or possession without concealment. Even if the length of possession in this case meets the statutory requirement, the drifter's secretiveness would invalidate the claim.

The "bundle of rights" refers to a set of rights

Enjoyed by the owner of a property. This group of rights includes the right to Possess, Use, Transfer, Encumber, and Exclude others from using the property. (Remember: "PUTEE") Transfer rights include the right to sell, rent, donate, assign, or bequeath. The owner may also encumber the item by mortgaging it as collateral for debt.

The type of deed that offers the grantee the fullest protection against claims to the title is the

General warranty deed. The general warranty deed, or warranty deed for short, contains the fullest possible assurances of good title and protection for the grantee. The deed is technically a bargain and sale deed in which the grantor promises to defend against any and all claims to the title. The overall general warranty covenant is: "I own and will defend."

What fundamental legal purpose is fulfilled by title records?

Giving constructive notice of one's rights and interests in the property. Recorded instruments may include deeds, mortgages, liens, easements, sale contracts, and marriage, probate and tax records. The primary purpose of recording and maintaining records of these instruments is to provide constructive notice of the conditions of a property's title-- who owns it, who maintains claims against it.

Ownership of real estate can be transferred voluntarily or involuntarily. The three ways title can be transferred voluntarily are by

Grant, deed, and will. Voluntary transfer, or voluntary alienation, is an unforced transfer of title by sale or gift from an owner to another party. If the transferor is a government entity and the recipient is a private party, the conveyance is a public grant. If the transferor is a private party, the conveyance is a private grant. A living owner makes a private grant by means of a deed of conveyance, or deed. A private grant that occurs when the owner dies is a transfer by will.

The only clause that is actually required in a deed is the

Granting clause. The granting, or premises, clause is the only required clause. It contains the conveyance intentions; names the parties; describes the property; and indicates a nominal consideration.

A judge rules in favor of the creditor in a court proceeding and places a judgment lien against all the debtor's assets, including his real property. This is an example of a(n)

Involuntary general lien. A general lien is one placed against any and all real and personal property owned by a particular debtor. An example is an inheritance tax lien placed against all property owned by the heir. A specific lien attaches to a single item of real or personal property and does not affect other property owned by the debtor. In addition, judgment liens are junior, involuntary liens.

Which of the following statements best describes the concept of land ownership?

Ownership includes the land, fixtures, plus air space above and downward to the center of the earth. Ownership includes the land, all things natural and manmade permanently attached to it, plus a volume of space that extends from the surface boundaries of the property down to the center of the earth. The upper limits of the space owned are today defined as a reasonable distance into the atmosphere.

By contrast to a condominium, the owner of a cooperative owns

Shares in a corporation or association and a proprietary lease in a physical unit. In a cooperative, or co-op, one owns shares in a non-profit corporation or cooperative association, which in turn acquires and owns an apartment building as its principal asset. Along with this stock, the shareholder acquires a proprietary lease to occupy one of the apartment units.

Which statement is FALSE?

The LCDC created a comprehensive plan for every city and county in the State of Oregon

The intensity of land usage generally refers to what?

The area of a commercial or industrial facility in relation to the size of the site. Commercial zoning regulates intensity of usage by limiting the area of store or office per site area. Intensity regulation is further achieved by minimum parking requirements, setbacks, and building height restrictions.

If a joint tenant sells his or her interest to an outside party,

The new owner becomes a tenant in common with the other owners, who continue to hold a joint tenancy with each other and a tenancy in common with the new owner. A joint tenant may transfer his or her interest in the property to an outside party, but only as a tenancy in common interest. Whoever acquires the interest co-owns the property as a tenant in common with the other joint tenants. The remaining joint tenants continue to own an undivided interest in the property, less the new co-tenant's share.

A condominium owner's share of maintenance and operations expenses are based on

The unit's pro rata share of the property value as defined in the declaration. The unit's pro rata share of the property's ownership as defined in the declaration determines the amount of a unit owner's assessment. For example, if a unit represents a 2% share of the property value, that unit owner's assessment will be 2% of the property's common area expenses.

Which one of the following statements concerning riparian rights is TRUE?

They are the right to reasonable use of river water that touches one's land in some jurisdictions Water rights arising from a stream or river are known as riparian rights. Typically, under this doctrine, a property owner has the right to use and appropriate water from a stream or river only if the owner's property abuts the water.

A waterfront homeowner has just died. What will become of the water rights the owner enjoyed while living in the home?

They transfer with the property when the property is sold. Littoral rights attach to the property. When the property is sold, the littoral rights transfer with the property to the new owner.

What is the essential purpose of legal descriptions of real property?

To create a consistent, unchanging standard for uniquely locating a property. A legal description of real property is one which accurately locates and identifies the boundaries of the subject parcel to a degree acceptable by courts of law in the state where the property is located. The general criterion for a legal description is that it alone provides sufficient data for a surveyor to locate the parcel. A legal description identifies the property as unique and distinct from all other properties.

A property owner leases 60 acres of agricultural land for a renewable period of 5 years. In the context of real estate rights, this lease represents a(n)

Transfer of a portion of the bundle of rights. An ordinary lease is a common example of the transfer of a portion of one's bundle of rights. The owner relinquishes the right to possess portions of the surface, perhaps a building, in return for rent. The tenant enjoys the rights to possess and use the building over the term of the lease, after which these rights revert to the landlord. During the lease term, the tenant has no rights to the property's subsurface or airspace other than what the building occupies. Further, the tenant does not enjoy any of the other rights in the bundle of rights: he or she cannot encumber the property or transfer it. To a limited degree, the tenant may exclude persons other than the legal owner from the property.

In a time-share freehold, owners acquire

Undivided interests in the property as tenants in common. In a freehold time-share, or interval ownership estate, tenants in common own undivided interests in the property. Expense prorations and rules governing interval usage are established by separate agreement when the estate is acquired.

Which of the following is true regarding master planning and zoning?

Zoning ordinances are a primary means of keeping land use in harmony with the master plan. The master plan fuses state and regional land use laws with local land use objectives that correspond to the municipality's social and economic conditions. The completed plan becomes the overall guideline for creating and enforcing zones, building codes, and development requirements.

One difference between a cooperative estate and a condominium estate is that

a condominium owner owns a unit of air space whereas the co-op owner owns a proprietary lease. The owner of a condominium has a fee-simple ownership interest in his/her unit and its air space. Whereas, a co-op owner has a leasehold, not fee-simple, interest with the property's corporation. Since the corporation owns an undivided interest in the cooperative property, debts and financial obligations apply to the property as a whole, not to individual units as in a condominium.

The greatest estate possible in real property is called

a fee simple estate. The fee simple estate, also known as fee simple absolute, is the greatest estate possible in real property, containing the greatest amount of rights.

The existence of an encroachment is best determined by

a survey The best method to determine an encroachment is by a survey.

A purchaser of a condominium can obtain which of the following on an individual unit? A mortgage Title insurance Homeowner's insurance

all of the above

A special assessment becomes a lien on real property

at the time the amount is determined and fixed Once the special assessment is determined and fixed, it becomes a lien on real property.

Items of personal property are called

chattels Chattels are items of personal property; they are items other than real property.

A private use restriction in a deed that contains a reverter clause as an enforcement device is called a

condition A condition is a private use restriction in a deed that contains a reverter clause as an enforcement device; if the condition is violated, the property reverts to the seller.

A municipality wants to build a sewage treatment facility which will require the acquisition of several parcels of privately owned land. What legal power enables the municipality to buy the necessary properties, even against the owners' wishes?

eminent domain Various government and public entities can transfer private property to the public sphere by the power of eminent domain. The transfer is involuntary, even though the owner receives compensation. For example, a city government wants to widen a highway to accommodate growth. The government uses eminent domain to condemn and purchase all properties abutting the thoroughfare in order to complete the construction project.

A conflicting land use that predates present zoning and is allowed to remain is a

non-conforming use. A non-conforming use is a use that is allowed but does not coincide with present zoning.

Statewide land use planning in Oregon is administered by

the Land Conservation and Development Commission In Oregon, the LCDC administers statewide land use and planning.

"Placed in escrow" means

the parties to the agreement have designated a neutral third party to hold documents and funds according to the mutual instructions of the parties. "Placed in escrow" means that the parties to the agreement have designated a neutral third party to hold documents and funds according to the mutual instructions of the parties.

Alienation is

the transfer of an interest in real property Alienation is the transfer of an interest in real property.

Tracing the conveyances and encumbrances of real property is known as

title search. A title search traces all of the conveyances and encumbrances of real property.