property

Caveat Emptor

"Buyer Beware" rule (Minority/Traditional Rule) (Used in commercial sales) • A seller owes no duty to disclose latent or patent defects o Exception: Can't fraudulently misrepresent in the Sales Contract

Duty to Disclose Material Latent Defects (Modern

) • Seller has a duty to disclose defects which substantially effect the property's value and that the seller knows are not readily discoverable on the premises - theory of implied warranty of fitness • Applies usually only to residential premises and not commercial • Further states have adopted numerous statutes that restrict or expand these rights o California has adopted a checklist that sellers must provide • Controversial disclosures o Do not have to disclose whether past tenant had AIDS or was a convict o A party was once required to disclose that the house had ghosts

Liens against property (other than mortgage)

*Note: Someone who forecloses on a mortgage generally won't do so until they go through the records system to ensure that they have seniority on the property - if there were other liens before that have priority, the holders of those liens will get paid off first - the mortgagor who is behind in line doesn't want this o Attachments - real estate is attached at beginning of legal proceeding to secure payment for judgment o Judgment liens - even w/o attachment, there may be a lien on your property after judgment to ensure that you pay up o Taxes/Assessments o Mechanics' liens - contractors who perform construction on real estate have liens on property to secure payment o Trust Arrangements - used in states (i.e. CA) where a deed of trust functions as a mortgage - if you don't pay up, the trustee sells the land and pays ME what he's owed o Liens are generally paid off in the order in which they were created; there can be several liens on a property at once

How are Covenants Created?

1) By Written Instrument • Standard way of creating a covenant 2) By Estoppel • Rule: When a party, through his conduct, creates the impression that he will only use his land in certain ways, and other parties detrimentally rely on this impression, a covenant may be created against the party through estoppel • Case Law: Shalimar - covenant for D to only maintain their property as a golf course created through estoppel b/c the golf course was referred to in the advertising materials, lots sold for higher prices, and owners relied on it; D real estate developers also bought land from original developer with notice of the golf course, even if it wasn't recorded since it was evident when they visited. The economic argument that golf course operation is unprofitable doesn't qualify to frustrate original purpose of the covenant. 3) By Implication Implied Reciprocal Covenants • Principle that when a common grantor conveys a subdivision of a property, the restrictions placed on prior conveyances of subdivisions of the property apply to the current (Sanborn v. McClain) conveyance if the grantee has actual or constructive notice of such restrictions o You can prevent an implied reciprocal servitude from being created in the future if, in the covenant over the subdivision of land you are selling off, you expressly denote that the covenant does not apply to other subdivisions of the land 4) By Prescription • Covenants usually cannot be created by prescription • Exception is when the landowners believe they are bound by covenants and perform the covenants for the prescriptive period 5) By Eminent Domain • Govt. can unilaterally impose restrictions on others' land - these may or may not require just compensation (see Takings section)

How Are Easements Created?

1) By Written Instrument (Standard Way) • Must be in writing (Statute of Frauds)— should record to protect • Manifest intent to create easement • Identify grantor and grantee • Describe the affected land • Signed by the grantor • Majority rule - can't reserve an easement in a third party (stranger to the deed rule); you can only at best reserve covenants in favor of a third party o Minority rule (followed by Restatement)- Can reserve easement in third party if intent is clear; third party can enforce easement as a third-party beneficiary of the contract 2) By Estoppel • An alternative way to create a servitude and to get around the statute of frauds. • A landowner may be estopped from denying the existence of a servitude, if, relying on a permission to use the land, the licensee made substantial improvement on the land o Case Law: Mund v. English - irrevocable license is created by court for P to use water well on D's property, and an easement to come across D's land for purpose of using the well is created, because P helped D set up the well, relied on D's permission to use the well for a substantial period of time, and made improvements to P's property (i.e. getting a loan and building a house, even though there was no other water supply) based on D's belief that he could use this well • Third Restatement - describes two situations where an easement is created by estoppel o when landowner allowed a person to use the land and that person reasonably did not foresee a change in position. o when landowner represented that the land was burdened by a servitude, it was reasonably foreseeable that a prospective buyer would change his position based on its existence, and the buyer detrimentally relied on this representation • Rationale o Equitable remedy designed to prevent unfairness or unjustness after someone has spent money in reliance on action taken by the owner of the would-be servient estate 3) By Implication • Another exception to Statute of Frauds Implied on the Basis of Prior Use • When if, before the tract was divided into two or more lots, a use existed on the "servient part" which was reasonably necessary for the enjoyment of the "dominant part" and which the parties intended to continue after the tract is divided, an easement may be implied after the tracts are divided o Some other jurisdictions say easement must be strictly necessary for enjoyment of dominant part o Quasi easement- when owner utilizes part of his land for the benefit of another part and then conveys one part (the quasi dominant tenement) of that land to someone, then it is considered an apparent, continuous, and reasonably necessary character, and will become an easement implied on the basis of prior use  **An implied easement can also be implied for the grantor's use if he grants someone else the quasi-servient portion, but this is less likely, because courts generally construe conveyances most strongly against the grantor  Case Law: Van Sandt v. Royster  original grantor had three lots numbered 19-20-4 (from west to east)  he built a drain running from lot 4 across 20 to lot 19 and then into a sewer west of lot 19  drain was not visible - it was underground  he then conveyed lot 20 by general warranty deed w/o reservations, and eventually conveyed lot 19; one D succeeded to lot 4  P on lot 19 sued Ds on lots 20 and 4 when drain began to leak sewage onto his property and they refused to stop using the train  P had no actual or record notice of easement  Court holds that there is an implied easement due to the quasi-easement doctrine; moreover, P had constructive notice of a drain b/c the house he bought was equipped w/ modern plumbing and his predecessor knew of the drain • Implied on the base of necessity o Can be created if the owner of a tract of land would have no access to a public road without the easement. An easement of way over the lot with access to the public road is implied  Case Law: Morrell v. Rice - easement by necessity created over D's property that abuts P's property so that Ps can access a public road from their landlocked land o Rationale: public policy dictates that access is essential to use, and the prevention of landlocked property is desirable o Terminates if other access is becomes available. o Note: courts can say that the use of the easement cant deviate too much from the initial use, while it should be ready to change with the times, it can't be too drastic of a change, the normal black letter rule: an express easement can be used with changing technology as long as it is serving normal development of the dominant estate • Government property o When the govt. conveys a parcel to a private entity which is completely landlocked by federally owned land, an easement by necessity is often implied o However, when govt. is the one that is landlocked inside property it conveys to others, courts are not likely to create an implied easement because the govt. could always condemn land around it to create an easemnt 4) By Prescription • See in section on Adverse Possession • A prescriptive easement can be established if it is used according to terms of an intended but imperfectly created servitude o Case Law: Paxson v. Glovitz  predecessors to P and D intended to create an easement that created a 20-foot driveway from 10-ft wide portions of each party's property, but it was not written or recorded and thus invalid  P and D used the driveway assuming that this easement existed for many years  When D tried to construct a fence on his side of the driveway, P sued an established an easement by prescription due to his use of the driveway in an "adverse" fashion for the statutory period  Rationale: Even if P had D's permission, his use was actually adverse and hostile b/c D actually owned his half of the driveway, and P was exercising use and claim of right in a manner that was hostile to D's actual ownership of that half of the driveway 5) By Eminent Domain • See in section on Takings Scope of Easements • The scope is as created by prior use or prescription, as the servient estate holder created it when implied from necessity, as grant or reservation stated • Can increase with technology. Easement for buggy travel can mature to easement for car travel • Use should not put an undue burden on the servient estate, but as long as no undue burden is created, easement may be used for any lawful and reasonable use (Morrell v. Rice) o Case Law: Morrell v. Rice - easement created by necessity for access to public road can also be used by Ps for the installation of underground utilities and can be expanded for serving more types of residences on the property that just a single-family residence • Owner cannot use it to benefit any estate other than the dominant estate o Courts however may get around this by not enjoining the use and instead granting damages most of the time this added use does not create damages (Brown v. Voss) • Intensity: Use should not overburden servient estate (look to party's intent)

Eviction Process

1) Notice to evict must be given so that 1) tenant has opportunity to cure breach or 2) if it is an incurable breach, they have notice that they must leave soon o 3-day notices  Used when the tenant is unlawfully in possession or has materially breached some dependent covenant in the lease  3-day notice to pay or quit  3-day notice to perform or quit  3-day notice to quit - used for incurable breaches (i.e. severe nuisances such as selling illegal drugs or weapons or endangering the safety of neighbors) o 30-day or 60-day notices  Used by tenant to terminate leases of tenants who are leasing under indefinite periods (i.e. week-to-week, month-to-month) • 2) Summary Judicial Proceedings (if T does not cure) o resemble a trial, but they are much quicker The only issue that is being litigated is whether the landlord has the right to possession

Requirements for making a gift causa mortis (in contemplation of death)

1) decedent intended to make gift at the time o Case Law: Woo (p. 639) - because the check can be revoked until it is cashed, it is better interpreted as a promise to make a gift in the future (which is unenforceable); thus, there was no intent to make a gift • 2) decedent apprehended death o Case Law: In Re Estate of Smith (p. 636) - decedent's checks to four people, accompanied by a suicide note, where held to be gifts causa mortis even though the defendant's impending death was due to his own choice and even though he didn't expressly state that he knew/believed he was dying soon and the death occurred within a reasonable time thereafter - it could be inferred from the suicide note • 3) gift was actually or constructively delivered • 4) death actually occurred

Requirements for Copyright Protection

1) idea must be "fixed in some tangible medium of expression" - does not need to be officially published (after 1976 Copyright Act) • 2) must be a creative, original expression o Literary work o Musical work o Grammatical work o Pantomiming or choreographical work o Pictoral, graphic and sculptural work o Motion picture and audio visual work o Sound recordings o Architectural work

Requirements for making a lifetime (inter vivos) gift

1) intent to make a transfer of an ownership interest in the property o Can be either a present interest or a future interest o The sentimental value and actual value of the gift are used by courts to infer intent in the event of low information  High sentimental value to donor and great actual value = less likely that there was intent to transfer ownership • 2) delivery • 3) acceptance

How Mortgages Work

: mortgages provide security to the mortgagee and financing to the mortgagor (the borrower) • When mortgagor (MR) borrows money from mortgagee (ME), ME has 1) promissory note establishing obligation from MR to ME to repay him; and 2) mortgage - document giving ME security interest in the land to assure performances of the obligation o ME can assign the mortgage to someone else - this should be recorded in the registry of deeds • If the size of MR's loan is less than the value of his property, the difference (value of property - size of mortgage) equal the equity o This can be sold to other parties • If MR wants to sell the land while the mortgage is still outstanding, he must sell the land to for the price of the equity. Sale can take three forms o Sale of the equity subject to the mortgage - MR is still liable to pay back the mortgage and buyer is not liable o Both buyer and MR are liable on the mortgage; if MR can't repay ME, then buyer indemnifies MR o (preferred method): Novation -buyer discharges MR from obligation to repay the mortgage and becomes the sole obligor • Additional mortgages can be taken against the equity left over after the first mortgage - the interest will usually be hire to account for the added risk

Types of Notice

Actual notice • purchaser actually knows or a prior conveyance Record notice • when a prior conveyance is recorded, everyone is deemed to have record notice of its terms • "chain of title" - documents that are discoverable by a reasonable search of the records o You only have record notice of what is within the chain of title, not what is outside • Case Law o Ryczkowski v. Chelsea Title  a landowner acquired land but did not record the sale; he then recorded an easement for a power line to a power company  a few years later, he acquired title to the land  land changes hands and eventually P bought the land  P hired D insurance company to insure the title  Power line easement did not appear in the chain of title  When P found out about the easement, he sued D for failing to list the easement as an encumbrance on his title  Holding: D is not liable b/c instruments executed by previous owners that were recorded before the owner acquired or relinquished title are outside the chain of title, so D is not liable for failing to discover such an instrument o Morse v. Curtis  Curtis was assigned a mortgage in 1881 and examined the registry and found a conveyance from the owner of the land to his grantor, Hall, that gave the grantor perfect record title  It turned out that there had been a prior mortgage to Morse that was not recorded until 7 months after the mortgage to Hall was recorded in 1876  Morse claimed that Curtis had constructive notice of the prior mortgage b/c it had been recorded by the time Curtis got the mortgage in 1881  Holding: Curtis was entitled to rely upon the perfect record title he found and was not required to search further to see if the original owner had any prior unrecorded deed o Buffalo Academy v. Boehm Bros  Buffalo conveyed a lot that was part of a larger tract of land to Boehm to discharge a debt and said that if the title was unmarketable, they would give Boehm $60K  Boehm said the title was unmarketable b/c of 1) a uniform building plan which restricts use of the lots on the land to residential purposes and 2) a covenant with another grantee to not sell gas or build gas stations on the remaining lots  Holding: 1) there was no uniform building plan that restricted use; 2) the covenant against building gas stations did not render the title unmarketable b/c it did not run with the land and b/c Boehm would not be charged with notice of this covenant, even if it was recorded and by its terms applies to all other lots  Rule: Purchaser only takes notice of encumbrances in the direct chain of title o Exception: Easements created by implication (Van Sandt v. Royster)

Alienability of Joint Tenancies

Alienable during life but not after death because interest is extinguished by death o However, alienating your share severs the joint tenancy and turns it into a tenancy in common with the remaining joint tenants  **Note: When there are more than 2 joint tenants and one transfers his interest, he becomes a tenant in common with the remaining joint tenants, who are all still joint tenants with each other  Case Law - Smolen v. Smolen (p. 578): Holding that joint tenancy over a house (pursuant to a divorce decree) b/w ex-spouses was severed when the man conveyed his interest to a new trust

Trespass to Land

An actionable invasion of a possessor's interest in exclusive possession of land o Owner entitled to actual damages o Punitive damages only given if actual damages (Barnard Rule)  Exception: If nominal damages will not be enough to protect right of exclusive possession, give punitive even when no actual damage  Case Law: Jacque v. Steenberg Homes - D forced to pay $1 in nominal damages and $100,000 in punitive for willfully going across plaintiff's property against P's wishes even though it caused little damage because it was winter and D's trailer could not do substantial damage to the land • Exceptions to the right to exclude o Civil rights statutes apply in places of public accommodation o Malls have to let people collect petitions there because they are areas open to the public (Pruneyard) • Farmers cannot exclude lawyers and doctors from his premises to prevent them from seeing his migrant worker employees (State v. Shack) o Rationale: Right to exclusion outweighed by social benefit  These populations are vulnerable because of a gross disparity in bargaining power b/w them and the employer (the workers are migrants, they don't have an outside Spanish-speaking community in the US in the 1970s, they have very low economic power)  These rights are essential to their well-being o

Partition

Any joint/common tenant has the right to bring a suit to partition property • Occurs when tenants cannot agree about how to use or dispose property • Types of partition: o Partition in Kind (Favored)  Each cotenant receives a parcel of equal value (or some parties can co-own parcels)  If some co-tenants receive more valuable parcels, they make payments to the owners of the less valuable parcels, called owelty  Courts may order partition by sale because the value of the land would drop too much if it was partitioned  Case Law: Wallace v. Daley - court refuses to partition land in kind even though P wanted to keep the house and give the other two co-tenants the almond orchard (could have been possible that the almond orchards were worth very little without the house) o Partition by Sale  All co-tenants must account for all unpaid carrying charges  Sales proceeds from the improvements will be allocated according to their value o Agreements prohibiting partition/alienation  Right to partition can be expressly or implicitly waived  Such agreements will be sustained if limited to a reasonable time  Otherwise, interpret all clauses limiting partition  If an agreement gives a right of first refusal to the other co-tenant, partition is permitted after the other co-tenant is offered the selling co-tenant's share and refuses (Leg Investments v. Boxler)

Assignability of Easements

At common law, easements in gross typically not assignable unless they are commercial or parties agreed that it would be o Restatement: easements in gross assignable unless parties didn't reasonably expect this • Appurtenant easements run with the land and transfer with deed Divisibility and Apportionment of Easements • Appurtenant/ Exclusive in Gross —can be divided and apportioned so long as it does not overburden servient estate • In Gross—Divisible and apportionable when assignable and when it does not cause any additional burden to the servient estate (Orange County v. Citgo) o By contrast, when such a division/apportionment would overburden servient estate, it may be impermissible  Case Law: Stanton v. T.L. Herbert - profit to remove gravel from an island cannot be assigned to three of the largest contractors in Tennessee o Common Stock Rule— old English rule that when two or more people are assigned a profit, the assignees must act jointly or as "one stock" in exploiting the resource - probably not followed in many jurisdictions anymore

Hostile Acquisition of Property

By Conquest • Rule: Acquiring property by conquest gives the conqueror exclusive title to the property • Case Law: Johnson and Graham's Lessee v. McIntosh - SCOTUS holding that the British govt.'s "discovery" of the land in their colonization of the present-day U.S. gave them title to the Indians' property; when the U.S won independence it got clear title to the property from Britain; thus, P's claim to title of the disputed land (which they had allegedly acquired from the Indians) was invalid and the land belonged to D, who had been granted title by the U.S. o Policy effects of this case: Because Indians were merely considered "occupants" rather than holders of the title, they could not transfer title to other private parties; thus, U.S. govt. could just buy out their occupancy at bargain-basement prices (because govt., as holder of the title, was the only one who could bid) and then grant land to different private parties By Adverse Possession Requirements for Adverse Possession • 1) Actual and exclusive possession o you must not only be asserting a right to possession but asserting a right to exclude others o does not require living on the land at all times o you must use all the land that you are claiming possession over, unless you have color of title - then you are said to be in constructive possession of everything in the title o Case Law: Ewing v. Burnet - Burnet used the property as a gravel lot, leased it, excluded others, and brought actions for trespass against those who entered the land, and was able to establish AP  Other examples: Making improvements on the property (i.e. building structures, planting non-indigenous trees) - these are all steps that show that someone who is not a possessor is making use of the property as if it is their own • 2) adverse or "hostile" possession o possessor must use the land in a way that violates the rights of the owner  i.e. a tenant acting like a tenant will not establish adverse possession against the landlord • 3) claim of right o Possessor must act in a way equivalent to being the owner of the land  Ex: paying taxes is often crucial to establish this - CA requires paying of taxes for adverse possession claims  By contrast, acting only like a hunter-gatherer on the land may not be enough to establish claim of right (Tee-Hit Ton Indians v. U.S.) o Majority rule: whether adverse possessor thinks they had title to the land the whole time or not is irrelevant  Minority rules  Maine doctrine - adverse possessor must realize they are taking someone else's property  Criticism: this rewards bad-faith possessor and hurts good-faith, mistaken possessor  Good faith rule - adverse possessor must think they have possession the whole time and be acting in good faith  Criticism: inhibits adverse possession of land which owner doesn't pay attention to at all but which everyone else knows he owns • 4) open and notorious o it must be evident that adverse possessor is claiming right - he must "fly his flag"  visible signs that you are claiming possession are often helpful in meeting this element  however, a random sign (i.e. the occasional sign) that can barely by found on a huge piece of land may not constitute open and notorious possession (Tee-Hit Ton Indians v. U.S.) o Rationale  Serves to give owner notice that someone is trying to establish adverse possession  However, notice just needs to be constructive, not actual - it is immaterial whether owner learns of adverse use o Whether the actual owner knows they have title during the period is irrelevant - what matters is whether the owner has notice of the adverse possessor's use (Lawrence)  Moreover, adverse possessor has no obligation to reveal to the proper owner that they own the property - they can even conceal this fact • 5) continuous possession o Adverse possessor need not stay there themselves the whole time, they can lease the land out to tenants as long as they are still acting like the owner (Lawrence) • 6) parts 1-5 must happen for the entire statutory period until the statute runs (statutory period is often 20 years but can be specified by state statute) o Statutory period continues to run even after actual possessor transfers title  Rationale: Public policy reasons; no one would adversely possess land if they could potentially lose it every time a new person gets the legitimate title and is still within the statutory period  This would allow owners who have missed the statutory period to evade the statute by selling the title to someone else and having the new owner effectively bring suit on their behalf o Tacking  When one adverse possessor transfers his or her interest in the property to someone who continues the adverse possession, the second adverse possessor can "tack" on the first adverse possessor's period of possession to fill the necessary statutory period  It is difficult to establish a "transfer" when you don't have legit title, so tacking is usually accomplished when the transfer happened under color of title (title certificate that in actuality was illegitimate)  However, tacking does not occur when there is no privity (transfer by deed, devise, or intestate succession) between adverse possessors o Tolling  Statute may be tolled (may not start to run until a later date) if the true owner is mentally ill, an infant, or in jail when the adverse possession commences - the statute begins to run when the disability ends  When a disabled person transfers adversely possessed property to a third party, the disability is deemed to end on the day of the transfer and the statute begins to run against the new party • **note: None of these powers need to be exercised to a greater degree than would be exercised by the proper owner of the property (Nome 2000)

Financing a Real Estate Transaction

Can be done through many ways o Direct payment from buyer to seller o Mortgage o Installment land contract  Like a mortgage, but the seller, instead of a bank, provides the financing  Buyer pays seller in installments  In earlier times, if the buyer missed a payment he breached contract and therefore he was left without property and seller kept all monies paid to him - seller got windfall  Modern Courts give buyer time to cure defects and the seller should not be unjustly enriched

Liability for Payments and Contributions on the Property

Carrying charges (taxes, mortage interest + payments on mortgate principal) o Each co-tenant must pay for their share of carrying charges  **Note: some jurisdictions hold that insurance + utilities are NOT carrying charges o The tenant paying for these may deduct their value from rent monies o If one co-tenant fails to contribute their fair share, the other can bring an action for contribution against him • Mortgages o If one co-tenant pays a mortgage when it's due or past due, he can recover from the others o If he prepays, he has to wait until it comes due

Termination of Covenants

Case Law • Westwood Homeowners Ass'n v. Lane County (p. 1058) o Holding that when the D county acquired title in a tax foreclosure sale to fifteen lots in a unit development for nonpayment of property taxes, the acquisition did not extinguish the lien that P homeowners' association had against the property due to unpaid assessments to the homeowners association  Extinguishing the servitude would impair the value of the entire subdivision  Moreover, the buyer in the tax foreclosure sale gets the benefits of the covenants, so it is only fair that he should also assume the burden of the assessment fees  OR law favors common interest communities b/c they are 1) more efficient; and 2) reduce the burden on the city for levying taxes to maintain parks and recreational areas and other public services (since this is done by the homeowners' association itself) Changed Conditions Doctrine • Restatement § 7.10 o (1) court may terminate servitude when a change occurs that makes it impossible as a practical matter to accomplish servitude's purpose and there is no practical modification that would allow the purpose of the servitude to be accomplished

property rights over body tissue

Cell Tissue removed during surgery for medical research • Rule: There is no property right of an individual over cell tissue removed by a doctor during surgery to prevent the tissue from being used for medical research • Case Law: Moore - holding that former patient could not hold his former physician liable for conversion after the physician used spleen cells in medical research o Rationale: 1) no property right over the spleen cells, which he had voluntarily given up to his physician; he did not retain title to them anymore; 2) this would go against public policy, which wants to encourage medical research and not subject researchers to potential liability; 3) statutes in CA clarify that human tissue must be disposed of by incineration or internment after surgery, so there is clearly no title by the donor o Counterargument: 1) this seems to offend social mores by treating the human body as a commodity; this also seems like unjust enrichment and the patient should receive profit for contributing the raw materials to the research Frozen Embryos • Rule: Frozen embryos left over from IVF are neither people nor property • Case Law: Davis v. Davis - the embryos are neither people nor property and the mother wants them donated to another couple, the father does not; the father's desire to avoid biological parenthood outweighs the mother's interest in donating the embryos

abandoned property details

Chattel was appropriately classified as lost because it was in the crevice of windowpane  The attachment exception does not apply because the brooch was not attached to the land - it was unattached on the surface of the land  The "private place" exception does not apply because the owner of the land wasn't even living in the house - it had been requisitioned by the army  Owner couldn't argue that he had custody of the brooch on behalf of the owner because the brooch wasn't intentionally deposited in his home  Counterargument: You could argue, given the circumstances, that the property was actually mislaid and thus belongs to the owner of the locus in quo (which is D) o Exceptions  1) Trespasser has no right to property he found on the land he's trespassing on  2) employee has no right to property he found while in the course of his employment - it goes to his employer (Staffordshire v. Sharman)  3) owner of real property possesses rights to all property that is attached to the land (Staffordshire v. Sharman)  4) you cannot "find" lost property in a highly private place (i.e. someone's home) - only in an area that is open to the public (i.e. a museum) or in an area that the owner does not occupy (i.e. a house that you own but do not live in)

Delivery of Gifts

Constructive Delivery • Recognized as an acceptable means of delivery when the subject matter of an oral gift is not available or capable of being physically handed over o Ex: giving keys to a car to hand over a car; disclosing location of buried cash to make the gift of cash; giving combination of a safe to gift what was inside the safe Is delivery of a check an effective way to deliver a gift of money? • Case Law o In Re Estate of Smith (PA) - Yes o Woo (p. 639, VA) - No; UCC holds that transfer of a check is not an assignment of $$ on deposit Symbolic Delivery • Delivering a symbol of the gift in order to deliver the gift • Ex: stock certificates to signify stock; title of the automobile to symbolize the vehicle o Beck v. Givens - gift of sheep made by delivering bill of sale to donee, even though donor retained possession of sheep during his lifetime

Duty to Uphold Implied Covenant of Quiet Enjoyment

Covenant b/w landlord and tenant that is implied in all leases - residential and commercial, written and oral • Duty: Landlord promises that the tenant shall have quiet and peaceful possession of the premises for the term as against the landlord, anyone holding through the landlord, or anyone with a title superior to the landlord • Remedy: In order to demonstrate a breach by landlord, tenant must show: o 1) actual eviction; or o 2) constructive eviction • To bring constructive eviction claim, T must 1) leave the premises and 2) show either a) substantial interference with enjoyment of all or part of the property or b) substantial interference with the ability to use the property for its intended purpose o L is liable for omissions/failures, not just L's affirmative measures  L also responsible for other tenants' acts if he can correct & fails to correct  T must inform L & allow reasonable time to correct  Bring cause of action if not fixed o What's substantial inference? Considerations:  Purposes of premises  Foreseeability of the type of interference  Potential duration of interference  Nature & degree of harm caused  Availability of means to abate interference  Examples:  Incessant noise from neighboring nightclub that also leases from L (Blackett v. Olanoff)  Failure to supply light, heat, power  Failure to install heating  Authorizing another tenant to obstruct the suing tenant's light and air  Examples of actions that are not substantial interferences  Next door tenants engaging in illicit drug sales or prostitutions  Failing to repair leaking roof when it does not prevent T from carrying on his commercial business (Wesson) o If he proves constructive eviction, tenant can get:  Release from the remainder of the lease  Economic damages  Punitive damages

Unreasonable Restraints on Trade

Covenant might not be enforced when it results in an unreasonable restraint on trade by denying other producers the right to compete in the market or by forcing consumers to buy a service/product they don't want • Case Law o Greenbelt Homes (p. 1026) - holding that D cooperative housing development unreasonably restrained trade in requiring its members to pay a mandatory 5.5% sales commission on all sales, regardless of whether or not they used D's real estate sales staff o Fortner (p. 1026) - SCOTUS holding that D's requirement that housing developers use prefabricated houses built by D as a condition of obtaining loans for buying/developing land violated antitrust laws o Laguna Publishing (p. 1027) - holding that management of a private, gated community could not exclude publisher that would compete for ad revenue with one of the community's businesses o Guttenberg Taxpayers (p. 1027) - holding that condominium association that endorsed certain political candidates had to provide equal access to other political organizations to distribute leaflets

Tenancy by the Entirety (Married Couples)

Creation • Four unities + couple must be married when they acquire the property o Example: married couple buying a home • In some states, any transfer to husband/wife creates a presumed tenancy by entirety; in other states, the presumption is a tenancy in common unless a tenancy by entirety (or joint tenancy with right of survivorship) is stated in the instrument of conveyance Elements • Right of survivorship • Unlike joint tenancy, tenants by the entirety cannot transfer their interests independently - they both need to agree to transfer • Limitations on severance • ONLY Divorce or agreement of parties severs it o For creditors to collect on it, both husband and wife must be liable, or they must execute a mortgage

• Common fair uses

Criticism (includes parody) o Commentary o News reporting o Teaching o Scholarship o Research Preventing Others From Using Non-Copyrightable Material • You can have them sign a contract that prevents them from reproducing the material for a commercial purpose when they buy the original work Copyrights to Factual Compilations • Rule: A compilation of facts is copyrightable when the facts are compiled in some unique or creative fashion

Rule Against Perpetuities

Default Rule: An interest must vest within 21 years of the death of all lives in being • Life in Being = Any person alive at the time of the conveyance having an interest in that conveyance o Default rule that for the creation of interests between corporations where the interest doesn't specify lives in being, the interest must vest within 21 years of the deed (Symphony Space) • Applies to: o contingent remainders, all contingent executory interests o class gifts  Note: when it is time for distribution, the class automatically closes

Titles

Definition of "title:" o the elements or attributes concerning possession o The default rule is that title in a sales contract is "marketable" Marketable Title • Definition: a title reasonably free of doubt, which a prudent purchaser would accept • To prove marketability you have to prove: o 1) that the outstanding claimants could not succeed were they in fact to assert a claim o 2) there is no real likelihood that any claim will ever be asserted • Rationale: We don't want buyers to be buying a lawsuit along with the property • Decided as a matter of law rather than a matter of fact Questions of Marketability of Title • Still Marketable o Failure to Disclose Zoning Laws o Zoning Violation w/o Court Action o Building Code Violations (deal with premises rather than title) • Not Marketable o There is a probability that the seller does not own the title o Property is subject to an undisclosed encumbrance, easement, or servitude  Exception: highly visible easement (inquiry notice) o Undisclosed co-owner who has not joined in the contract for sale o Mortgages or liens on the property o Erroneous acreage etc. • **Seller should be given at least until the closing date to cure these defects in title

Right to Publicity

Definition: Common-law right to control others' commercial use of your name, likeness, or identity • Right to publicity often butts heads with the 1st Amendment

How Much Protection Does a Purchaser Have Against a Prior Unrecorded Deed?

Depends on statute • Four kinds of statutes Notice Statutes • BFP is protected whether they record their deed or not o Purchaser must be a bona-fide purchaser (BFP) - they give valuable consideration and have no notice of prior instrument • Thus, the previous title is divested as soon as the bona fide purchaser gets title to the property, whether or not it is recorded • However, if purchaser has notice of prior deed, he does not get title Race-notice statutes • Protects BFP only if they record their deed first • The type of notice in CA • Thus, a previous title, if not recorded, will be divested if someone else comes along and gets title to the property through a bona fide purchase and then records the purchase o No title if you don't record first or if you had notice Period-of-grace statutes • Protect BFP only if the prior grantee doesn't record prior deeds within the grace period allowed by the statute Race statutes • Protect the purchaser, regardless of whether he has notice or not of prior unrecorded deeds, if he records his deed first Distinction from race-notice is that, under race-notice, you do not have a claim of title if you had notice at the time of purchase that someone else had title to the land; under a race statute, you can get title to the land regardless of whether you had notice of a competing claim as long as you record your title first

Rights to Underground Water

Did water come from a stream? o If underground water can be proven to come from a stream, the same laws that apply to above-ground streams apply (see above) • If the water is diffuse or percolating, one of three doctrines may apply o "Reasonable Use" doctrine  Most common doctrine in U.S; developed b/c absolute ownership doctrine was leading to depletion of aquifers  Generally no limits on use of water (other than for malicious or wasteful purposes) as long as use is "reasonable" - uses on the land where the water was extracted are usually found "reasonable" and uses where the water is transported off the land are often considered "unreasonable"  Case Law: Cline - court prevents D from pumping out so much water from a communal aquifer for D's quarry that the aquifer becomes more contaminated; subjects D to a "reasonable use" standard  Rationale: Benefits entities who are economically less well off, prevents "tragedies of the commons" o "Absolute Ownership" (English) doctrine  Whoever claims the water has an absolute right to use it w/o regard to how it affects the ability of his neighbors to use the water, unless he is maliciously collecting the water to injure others  Rationale: Encourages investment by powerful entities in a resource-rich area; however, it can lead to a tragedy of the commons o "Correlative Rights" doctrine  Developed in CA; similar to "reasonable use" doctrine but in times of shortage, a court may apportion the water amongst different parties  Rights do not extend to the right to deplete a neighbor's water supply

Donative Intent - What Can Be Donated?

Donation of a remainder with retention of a life interest (Gruen v. Gruen) • Is legitimate with respect to real property, chattels, stocks, bonds • Intent o Can be inferred as long as it is clear that the donor intended to transfer the remainder interest to the donee o Different from a testamentary conveyance in a will because:  Gift of remainder is irrevocable; wills can be changed  Remainder interest vests immediately even if possession does not; under a will neither title nor possession vests immediately  Postponement of possession occurs due to terms of the gift with donation of a remainder interest/reservation of a life estate in the donor; postponement of possession in a will occurs due to the nature of the instrument (will) • Delivery o Property does not need to be physically delivered when all that is being transferred is the remainder interest • Acceptance o Oral and written statements of acceptance (including statements made to people other than the donor) are sufficient to constitute acceptance

waste

Duty Not to Commit Waste/Duty to Repair Rule of Waste • A tenant's actions in the apartment constitute waste if he commits damage that substantially and permanently injures the reversion • Rule tests o Whether he materially and permanently changes the nature and character of the building (i.e. converting area into a hotel; removing some partitions and erecting others) - constitutes waste even if market value of property is enhanced  Especially likely that there is no waste when L can restore premises to previous state fairly easily (i.e. if T removes old cabinets but stores them around) • Examples of Waste o Converting residential home to a factory o Destroying/modifying entire walls or utility systems • Not Waste o Sigsbee - holding that T's replacement of old cabinets with new ones in the apartment did not constitute waste o Ordinary wear and tear o Ameliorating Waste  When the present interest holder's reason for making the changes:  Are a result of permanent, substantial change to the character of the neighborhood has deprived the land of its existent form of productive use  And those changes would be made by a reasonable owner of the property in fee simple absolute  Makes the "waste" non-actionable

Landlord's Duties and Tenant's Remedies

Duty to deliver possession: Two alternate rules • English Rule: Deliver to tenant not just right to possession but actual possession o Remedy: Tenant who is not given possession may:  Void Lease  Sue landlord for economic damages  accept possession with ensuing damages o Rationale  Landlord is in better financial position to deal with holdovers  Landlord has better knowledge of what the actual rules are  Landlord has better knowledge of whether there are holdovers on the day the lease is supposed to begin  Tenant's expectations in signing lease - he doesn't expect to have to evict trespassers on day 1 • American Rule: Need only deliver to tenant only right to legal possession o Tenant has to bring lawsuit against someone else who refuses to leave the premises—even though o Remedy: Tenant who encounters a trespasser on his property may:  Sue for trespass and ejectment  Can get monetary economic damages  Can get equitable remedies (trespasser removed from premises) o Rationale  Tenant has to deal with trespassers on any other day, why not on first? o Case Law: Teitelbaum - court applies American rule and holds that D landlord is not liable to P tenant for not evicting holdovers in P's apartment by the time P's lease was supposed to start

Duty to Fulfill Implied Warranty of Habitability (For Residential Leases)

Duty: Landlord warrants that he will maintain habitable premises for T to live in o Not waiveable/can't be contracted around o T must inform L & allow reasonable time to correct o What Constitutes Breach?  Cal Civil Code § 1941.1  Lack of effective weather proofing  Broken windows and doors  A non-functional hot and cold water supply  Broken plumping or gas facilities  Broken heating or electrical system  Filthy or animal-infested building, grounds, and appurtenances  Floors, stairways, and railings in disrepair  **note: these conditions cannot have been caused by T's lack of ordinary care • Remedies for T: o Sue for damages  Can include damages equivalent to difference between apartment in working condition and apartment in present state  Can include damages for emotional distress if the disrepair is caused by gross negligence on L's part (McNairy)  Can include punitive damages o Cal Civil Code § 1942.4: If public official has informed L of their duty to fix premises and more than 35 days have passed since w/o the premises being fixed, T can stop paying rent for period in which the apartment is not in working order and also get $5K in damages o "Repair and deduct" - T can fix the premises himself and deduct the cost of fixing from his rent o If the breach is substantial enough to constitute constructive eviction, T can terminate lease o **Note: It is not necessary that T leave premises (unlike constructive eviction)

Tenancy in Common

Each tenant has equal rights to possess the whole of the property, even if they own different percentage share of property o Not to the exclusion of the other tenants o Each shares in the profits according to their ownership interests • Alienability o One's own interest is alienable and inheritable, new owner becomes tenant in common with others • If no other form of ownership is specified in a deed of property to multiple people, the presumption is that the people are tenants in common o Exception: Trustees are joint tenants with right of survivorship

Duty to Make Repairs/ Improvements

Easement holder has right to make improvement to easement so long as the improvement promotes use of the easement within the scope of the easement and does not unreasonably burden the servient owner's use or enjoyment of property

easement

Easements Definition • Right to use someone else's property for a particular purpose Types of Easements • Appurtenant: When easement benefits the owner of the land in his use of the land and thus runs with the land (Preferred Type of Easement) o Ex: one owner of land, A gives his landlocked neighbor B a right to cross his land to get to a public road o When the nature of the easement is ambiguous, courts lean towards construing it as an appurtenant easement • In Gross: Attached to the holder (Person or Entity) o Ex: A gives B the right to put a billboard on his (A's) land. B doesn't even have to own any land o Used to not be assignable; now transferring easements in gross is allowed o **Traditionally, covenant benefits in gross could not be enforced in equity (only damages), but easement benefits in gross could be enforced at law and in equity • Exclusive: Very close to ownership of a fee simple—can exclude even servient estate owner (Fairbrother v. Adams) • Personal: Non-assignable easements - only the dominant owner can ever use them • Affirmative: Authorizes holder to do something • Negative: Prevents owner of servient estate from doing something o Traditionally courts did not like these: Only easements that were allowed were against blocking windows, air, water, and removing support o Modern courts much more flexible: Like negative easements preventing one owner of depriving another owner of a certain view • Profit: Right to enter property and remove some natural resource o i.e. the right to go onto someone else's land to hunt and fish on the land • License: Not an interest in land but a revocable right to use someone else's property o Thus, they cannot run with the land or with an interest in the land because they can be revoked o In some cases, courts may declare an irrevocable license, but this is functionally the same as an easement (Mund v. English) • Conservation Easements: statutorily created easement that combines elements of easements and covenants to make an easement for the purposes of conservation

Rationale for Adverse Possession/Prescription Doctrine

Economically efficient use of land - reward the possessor who actually uses the land at the expense of owners who fully utilize it and punish the lazy owner who sleeps on his property • People should bring claims to land while the evidence is still good (general justification for statutes of limitations) • Oliver Wendell Holmes wrote that when someone (even if a trespasser) comes to use and enjoy something as their own for a long time, it "takes root in your being" and emotionally harms you if someone comes back and takes it away from you by claiming that they have title to it o Reliance interests develop in the property

Takings

Eminent Domain: Defintition • Defined as the power of the state under the 5th/14th amendment of the Constitution to take control, ownership, and dominion over private property provided that: o 1) there is a public purpose for the state taking the property o 2) the state pays just compensation to the property owner for the land it takes When is Eminent Domain Permissible? Conventional Public Uses • Building schools, roads, bridges, airports, railroads, etc. Private Use (state briefly controls land and transfers it to private hands) that serves a public purpose Economic Revitilization/More Tax Revenue • Kelo v. New London - private land is taken (the land is not blighted, it is just in a depressed city) to build a Pfizer plant as part of a redevelopment scheme; SCOTUS holding that the increased tax revenue and economic revitalization to the depressed city constitute a public purpose that justifies the taking; the city o Court is deferential to government conclusions - they don't require "clear and convincing" evidence of an economic benefit but give local governments broad latitude o Counterarguments: 1) creates a slippery slope where any time someone is not using their land in the most economically productive way, the govt. could take it to give it to a private property that would use it more productively; 2) gives undue influence to private corporations, who can dictate the scope/nature of the taking of the private property of those who are economically less powerful; 3) has a disparate impact on the poor and other politically powerless people who cannot fight back against govt. takings (this is why freeways run through poorer areas of LA and not Beverly Hills) • Berman v. Parker - SCOTUS holding that it's acceptable to condemn land in a blighted area of Washington, D.C. in order to transfer it to private properties for the purpose of urban renewal/economic redevelopment Breaking Up Land Oligopolies • Hawaii Housing Authority v. Midkiff - SCOTUS holding that state could use eminent domain to transfer fee title from lessors to lessees; the small number of landowners who owned a huge % of Hawaii's land skewed the housing market and distorted prices Facilitating Entry Into Specific Markets • Ruckelshaus v. Monsanto - SCOTUS holding that EPA could take trade secrets submitted by a prior pesticide applicant to evaluate a subsequent application because sparing future applicants the cost of time-consuming research eliminated a significant barrier to entry in the pesticide market and thereby enhanced competition • Poletown Neighborhood Council v. City of Detroit - Michigan case that allowed Detroit to condemn areas in a Polish-American neighborhood to build a GM plant because jobs created and expansion of the industrial base would serve a public purpose o GM basically picked out the exact scope and nature of the taking and made no commitment to stay for an extended time o This case has subsequently been overruled Preventing an Economically Valuable Company from Leaving the Area • City of Oakland v. Oakland Raiders - holding that city of Oakland could permissibly condemn the Raiders football team to keep them from moving to LA; however, this taking was later determined to be invalid under the Commerce Clause Possible Constitutional Limits • When the "public purpose" is a clear pretext for benefit to the private party that will subsequently control the land (Kennedy's concurrence in Kelo) Various Statutory Limits • California - land can't be taken unless the land itself is blighted Zoning Ordinances • Rule: Are constitutionally valid uses of the state's police power as long as they are not arbitrary or unreasonable and there is a legitimate government purpose (rational basis test) o If the validity of the classification is debatable, courts defer to the legislature o Exception is when there seems to be a suspect class (i.e. a racial group) singled out by zoning laws • Rationale: Zoning ordinances are often essential to promoting public health, safety, morals, or welfare; example: one's unrestricted use of his own land (i.e. building a factory) may destroy the area for different uses of land (i.e. nearby residential homes) o Moreover, the property owners' interests are represented in their local governments - this separates zoning from nuisance laws • Case Law: Village of Euclid v. Ambler Realty (p. 1115) - SCOTUS holds that zoning ordinances that imposed use, height, and area restrictions and reduced P realtor's property to 25% of its original value were valid exercises of the state's police power and did not need to come with just compensation

How Can an Easement Be Terminated?

Express termination • Impossibility of Purpose o Once the easement no longer serves any purposes, it may be terminated • Abandonment (stop use- manifest intent to abandon) • Merger (one party takes ownership of both dominant and servient estate) • Prescription • Estoppel • Misuse (rarely used) • Restatement allows a court to sometimes terminate easements in gross if you cannot locate the beneficiaries

fee simple clues

Fee Simple Determinable or Condition Subsequent? • Words creating a fee simple determinable are usually durational, adverbial words o so long as o during o while o until o unless • Words creating fee simple on condition subsequent: o but if o on condition that o provided that o if it happens that Fee Simple Absolutes, Life Estate, or Fee Tail? • No words of limitation or "and his heirs" - absolute • "for life," - life estate • "and heirs of his body" - used to be fee tail, but they are not enforced anymore, so now • most likely fee simple absolute

fee simple def

Fee simple determinable • Grantor retains possibility of reverter Fee simple on condition subsequent • Grantor retains a right to re-entry/power of termination • **Note: if someone takes adverse possession of the fee simple on condition subsequent, the holder of the reversionary interest can still kick them out after they violate the condition - in order to get the fee simple absolute they would have to establish adverse possession against the holder of the reversionary interest after violating the condition (applies to a fee simple determinable also) Fee simple on executory limitation • 3rd party has an executory interest Condemnation of fee simple determinable estates • Rule: Restatement holds that when a defeasible fee simple estate or the reversionary interest is condemned, the present holder of the land gets the entire condemnation proceeds unless violation of the condition was imminent o Rationale: this would unfairly profit the holder of the right to re-entry or power of reverter when there was no sign that the fee simple would ever revert to them o Exception: does not apply when the reason the reversionary interest was condemned was to allow the condition to be broken (City of Palm Springs v. Living Dessert Reserve)  Rationale: doing so would allow cities to make an end run around a party's grant of land to it in defeasible fee simple estates and use the land for a contrary purpose without compensating the grantor o Counterargument: giving the holder of the defeasible fee simple the entire condemnation proceeds grants them a windfall, because the value of the land to them was actually equal to the total value minus the diminution caused by the conditions they had to follow (Ink v. City of Canton) Fee Tail • Not used anymore, but limits the estate to the lineal descendants Life Estate • Lasts for the life of the grantee Creation of a Life Estate • Rule: a deed subject to a life estate in a third person (even if the person is a stranger to the deed) creates a life estate in that third person (Nelson v. Parker) o i.e. O gives fee simple "to A, subject to a life estate in B," - B has the life estate and A has the remainder

Class Gifts

Future interests to members of a class of indeterminate size (change in class size will alter each individual class member's interest) • Example: O to "A for life, remainder to B's children" Rules for When a Class Closes • Rule of Convenience o Rule of construction that class closes when some member of the class can call for a distribution of his share of the class gift  Rationale: balances interest of including as many persons in the class as possible with the interest of allowing distribution of the property at first opportunity without needing a future rebate/redistribution • Examples o When a will makes a class gift, class closes at the date of the testator's death  i.e. T's will gives property "to B's children" - at his death, B's existing children get the property and B's future children cannot get anything  Exception - when there are no members of the class upon the testator's death, the class stays open indefinitely (i.e. if B had no children at the time of T's death) o When a deed gives a gift at a later time (i.e. expiration of a life estate), class closes at the time fixed for distribution  i.e. if T gives property "to A for life, remainder to B's children" class closes when A dies o when the class gift is conditioned upon class members reaching a certain age, the class closes when the first class member reaches that age  i.e. if T gives property "to A's children who reach 21," class closes when A's oldest child reaches 21 - any children that A already has have an executory interest that vests when they reach 21, but any children that A may have in the future have no interest

Types of Deeds

General Warranty: Grantor warrants title against defects arising before and during the time the grantor was connected with the land • Special Warranty: Grantor warrants the title against defects arising during the grantor's association with the land, but no against defects arising before that time • Grant Deed: California's name for a special warrantee deed; given a lot because people usually buy title insurance o in CA, this is all that is required instead of a general warranty deed - probably because almost everyone buys title insurance anyway and this is generally more effective than the grantor's warranty • Quitclaim Deed: Grantor warrants nothing; the grantor merely transfers what tile the grantor has, if any • Sheriff's Deeds: Given after foreclosure, these deeds do not give warranty • Reconveyance Deeds: Deeds transferring ownership from trustee back to trustor • Gift Deeds: Deeds transferring ownership for "love and affection". Viewed with skepticism as far as creditors are concerned • Void Deeds o Deed from a person judicially determined to be incapacitated o Forged Deeds o Deeds from un-emancipated minors o A deed purely testamentary in character • Voidable Deeds o Deeds that are not void on face but could possibly be voided if challenged in court  i.e. deeds from a person of unsound mind who has not been judicially determined to be incapacitated

What Constitutes "Touching and Concerning" The Land?

General rule o A successor to the original covenantee can prove that the covenant he seeks to enforce touches and concerns his land when it affects the enjoyment of his land  Distinction between "running with the land" and "running with an interest in the land" o You can enforce a covenant against a successor to the original covenantor when you can prove it touches and concerns the land of the servient owner by reducing the enjoyment of the servient owner's land • Examples o Covenants for the servient owner to only use the land for residential purposes run with the dominant land as well (Runyan v. Paley) o Covenants for the servient owner to pay an annual charge to the dominant owner for improvements to the servient estate run with the servient land (Neponsit)  Case Law: Neponsit - successor to servient owner's land must adhere to covenant stipulating that the covenantor pay annual fees to P property owners' association for annual improvements to the property o Covenants for the servient owner to pay the dominant owner money in exchange for an annual water supply do not run with the land (Eagle Enterprises)  Case Law: Eagle Enterprises v. Gross - covenant that forced D's predecessor to pay P's predecessor for annual delivery of water did not run with D's land b/c 1) he could just as easily construct his own water supply; 2) no land would be deprived of water w/o the supply and the price of water would not be prohibitive w/o the supply; 3) this resembles a contractual obligation more than a covenant o Covenants for the servient owner to only use his land for certain conditions and to not sue the city (dominant owner) in the event of a landslide on the servient owner's property run with the land  Case Law: Lakeview Boulevard - P successors to the servient estate cannot sue D city because the covenant (as described in rule above) that their predecessors made runs with the land b/c it limits rights ordinarily associated with ownership and b/c it relates to soil which is part of the land

Abandoned Property

General rule is that abandoned property is fair game to whoever finds it o i.e. in Popov v. Hayashi, the baseball owned by MLB, which Barry Bonds hit into the stands, was intentionally abandoned because MLB had no intention of reclaiming the ball and thus Popov and Hayashi were the only two people fighting over possession

Accounting (Sharing in Profits)

General rule: co-tenant does not owe money to other co-tenants for profits he makes from sole possession/use of the property, but he owes them money from renting property to a third party • But he can offset (deduct from what he owes the others) actual costs associated with: o generating and collecting the rent o amount expended on taxes, interest, mortgage principal, and insurance o advertising, management fees o actual amount spent on repairs, maintenance and utilities o Example: A is a cotenant with B and C. He makes $1500/month in renting property to a 3rd party. He spends $1000/month in mortgage interest/principal payments, $120/month in maintenance, and $80/month in repairs. He offsets these amounts from $1500 to get $300/month, so he owes the B and C $100/month each • Co-tenant CANNOT demand contribution if his expenditures exceed his revenue, but he can demand contributions for paying a) property taxes; b) govt. assessments; and c) interest/principal payments on mortgage o Example: A is a co-tenant w/ B and C. He pays $3000 in taxes annually and $5000 in mortgage payments annually. He rents to a 3rd party who pays him $2000 annually. After deducting the taxes and mortgage ($8000 total) from the $2000, he still has a deficit of $6000. He can demand that B and C each pay him $2000 for their share of taxes/mortgage • Co-tenant can recover an accounting equal to the sales proceeds attributable to the value added by his improvement o The amount spent on the improvement is immaterial because we do not want the other co-tenants to have to bear the cost of losing investments o But the improver should get an accounting if he increases the sale value because we don't want to unjustly enrich the others when one did all the work

Revocability of Gifts

General rule: there must be an express power to revoke the gift Gifts given to third party intermediaries with instructions to give to the donee • When express power to revoke is not needed o When the gift is given in contemplation of marriage or death o When gift is given to the third person as a "trustee" in a revocable trust • Otherwise, express power to revoke is needed if revocation can occur

What does "Privity" Mean

Horizontal privity o Original definition was that there needed to be a landlord-tenant relationship b/w covenantor and covenantee; was eventually expanded to other kinds of lesser estate - fee simple relationships o Modern definition: covenant had to be made simultaneously with a transfer of property between covenantor and covenantee (can be a fee simple transfer, does not just need to be a lesser estate) o Case Law: Runyon v. Paley ¬- there was no vertical privity b/w Runyons (P) and D, who bought land subject to a covenant from another party (not the Runyons) well after the Runyans bought their land from the same party • Vertical privity o Strict - successor to covenant must have the same estate as the original covenantor or covenantee o Relaxed - successor to covenant must have some estate as the original covenantor or covenantee

Elements of the Deed

Identification of the then-existing parties—Can only give to competent parties o Though an incompetent person can have a guardian manage the property as a trustee • Description of the land • Granting clause Words indicating a present intent to convey • Grantor's signature • Must have an acknowledgement to be recorded in the land records system • Deliver The Deed

...

Impermissibly Discriminatory Covenants • Covenant's enforcement may be racially discriminatory violate Equal Protection Clause of 14th Amendment of Constitution o Case Law  Shelley v. Kraemer - SCOTUS holding that covenants between homeowners that were intended to run with the land and forbade homeowners from selling homes to African-Americans could not be enforced without violating the EPC under the 14th Amendment  Barrows v. Jackson - SCOTUS holding that the white seller has standing to raise the rights of the non-white buyer as a defense to damages against the seller for violating racially restrictive covenants • Covenant may discriminate against the handicapped in violation of the Federal Fair Housing Act o Case Law - Hill v. Community of Damien - covenant limiting use of a residence to single-family occupancy does not apply to a "group" home for people with AIDS b/c 1) these people can be defined as a "family" because they give each other friendship and support and public policy encourages people with disabilities to live together and support each other in this way; and 2) enforcing the covenant would violate the FFHA's provisions against discriminating against those with disabilities (due to disparate impact the fact that not enforcing the covenant would have been a reasonable accommodation) • Covenant may discriminate on basis of familial status o Case Law: Simovitz v. Chanticleer Condominium Ass'n - holding that FFHA prevents discrimination by a housing facility against selling or renting to families with children in housing unless the "55 and older" exemption is met by showing that 1) facility is designed specifically to meet the needs of seniors; and 2) at least 80% of the units have one person 55 and over living in the house

Covenants That Implicitly Constitute Restraints on Alienation

Impermissibly high transfer fees o A statute in CA caps the transfer fee payable to the dominant owner upon the servient owner's sale of his property o Rationale: Transfer fees (or "quarter sales") discourage people from selling the land because they have to pay a share of the sale to someone else - this takes land off the market  Regardless of whether the transfer fee is permissible, though, the transfer fee might make it harder to get a mortgage under new Federal Housing Finance Agency (FHFA) loans limiting the ability of Fannie Mae or Freddie Mac to purchase mortgage loans on properties that are encumbered by transfer fee covenants o Counterargument  Something like a transfer fee may be permissible when they are designed to reach acceptable social or economic ends (i.e. making land available for development)  Case Law: Kerley v. Nu-West - covenant forcing P buyer of land from D developer to pay 10% of all gross sales of the land to D was upheld b/c under AZ law, the purpose of the agreement was to develop and sell land and it doesn't matter whether the 10% fee was labeled as a payment for land or a payment for consulting service

Rights and Obligations Between Joint Tenants

Joint tenancy over frozen embryos (Davis v. Davis) • holding that frozen embryos are somewhere in between "property" and "persons" due to the potential that they can become human lives • parents have equal interest in the future of the embryo • when parents disagree about what to do, interests of mother and father must be weighed against the other • parents froze embryos for invetro fertilization and then divorced • mother wanted to give away frozen embryos to another family to birth/raise the children; father did not want one of his biological children growing up in a family without his biological father around • Court rules that the father's interests in not wanting fatherhood imposed on him or in not wanting to father a child that grows up in a different household outweigh the mother's interests in having gone through the pain/effort of taking injections to produce eggs for IVF • Thus, frozen embryos cannot be given away to another family

Gifts

Land gifts • Intent must appear in writing signed by donor Other gifts • May be expressed orally or inferred from the surrounding circumstances Common questions in gift disputes • Was there intent to make a gift? • If there was no signed writing or handing over of the property, what type of action happened from which you could infer that a gift was being transferred from donor to done? • Were the formalities for a donative transfer fulfilled? Doctrines limiting the scope of inter vivos gifts • 1) gratuitous promises are not enforceable (you can't just promise to give a gift, you have to actually make the transfer) • 2) transfers taking effect at death (testamentary transfers) must be made by written will Exception - gifts causa mortis

Seller's Remedies for Breach of Sales Contract

Legal remedies o Seller may keep the buyer's security deposit (i.e. Sechrest v. Saviol) o Seller may keep land and get from buyer the [presumably positive] difference b/w the contract price and the [presumably lower] market value of land on date of breach • Equitable remedies o Injunctions; discretionary with court; usually not awarded unless party had behaved in an equitable fashion; more drastic because it operates on the person requiring them to do/not do something o Specific Performance  Court may order the buyer to purchase the land from the seller in exchange for the contract price - this is often the result because each piece of land is unique, so specific performance can be sought fairly easily for land  If seller can't give marketable title, specific performance requires transfer with abatement (reduction) of price that buyer has to pay

What Can You Do With An Intellectual Property Right to Enable Others to Use Your Intellectual Property?

Like any other property right, it may be sold, licensed, mortgaged, assigned or transferred, given away, or simply abandoned

Limits to Adverse Possession/Prescription •

Limits to Adverse Possession/Prescription • Majority rule: government land cannot be subject to adverse possession or prescription o Case Law: Kiowa Creek - party seeking a prescriptive easement could not establish that it had fulfilled the statutory period because for the first eight years, the government owned the land o However, not all jurisdictions follow this rule • Rule: Adverse possession and prescriptive easements can never be established against the holder of a future interest in the property; it only applies for the length of the present estate o You must wait until the future interest becomes present and then start the whole process over; however, if the future interest was created after you took possession, the statutory period runs against the future interest holder as well o Case: Dieterich - P's prescriptive easement only applied to the estate of the life tenant but not to the reversion held by the landlord o Rationale: The holder of the future interest cannot sue to eject someone using the property unlawfully (this right belongs to the possessor) - he can only sue if the person is injuring the future interest by causing waste

Insurable Title

Means that a reputable insurance company will insure the title at a regular rate • This will indemnify the owner of the land from liability in actions by other claimants • **is a lesser title than marketable title • Benefits to Title Insurance o Will ensure you that the property is not landlocked (impossible to reach by land) o Will insure you that the title is not forged

What Civil Causes of Action Can Be Brought For Wrongfully Taken Property?

Modern cause of action o Conversion - appropriating someone else's property by establishing dominion and control over the property  Can be a legal (damage) or equitable (specific performance) remedy  When damage amount is uncertain because the property is never returned, courts take the high end to give P benefit of the doubt (Armory v. Delamirie)  To bring an action for conversion, one needs to establish: either 1) ownership or 2) right to property at the time of conversion • Old rules o Legal Remedies  Trover - action for recovery of damages for the wrongful conversion of property  To bring an action for trover, one needs to establish: either 1) ownership or 2) right to property at the time of conversion o Equitable Remedies  Replevin - if property was taken from the owner unlawfully  Detinue - if the defendant originally took possession lawfully (i.e. had permission) but then refused to return it  To bring an action for either, one needs to establish: immediate right to possession of the property

What Else (Besides Inter Vivos Alienation) Could Sever a Joint Tenancy?

Mortgaging against your interest (in title theory states o Lien theory states  Title remains with tenant and so there is no severance  Property is/is no longer subject to the mortgage upon death  Case Law - People v. Nogarr (p. 574)  Man and wife separated but still had joint tenancy over property  Man gave his parents a mortgage on the house to accompany a promissory note to pay them $6,440  Man died before he could pay back all the money  Govt. condemned the property the next year and the parents (mortgagees) said they were owed $6,440 in compensation for their interest in the property  Holding: Mortgagees have no interest in property because the mortgage did not transfer the interest but just created a lien on the man's existing interest; when the man died the interest dissolved and his wife had the full interest in the property o Title theory states  Title in fee simple determinable belongs to creditor, so debtor's interest is severed and he becomes a tenant in common with the other tenants • Severing joint tenancy and converting interest to tenants' in common o In some states, a joint tenant must do this by conveying his interest to a straw man o In other states, a joint tenant can sever and make himself a tenant in common w/o a straw man • Murdering the other joint tenant o In some states, you (the murderer) would become tenants in common and the other tenant's interest would pass to the heirs o In other states, you would be deemed to be holding the property in constructive trust for the heirs of the other tenant - thus, you keep your interest but cannot profit off of it • When one joint tenant leases to a third party o Old rule - Lease serves as severance pro tanto for the term of the lease  Even if leasing joint tenant dies before lease runs up, lease must expire before the joint tenancy resumes o New rule - Lease does not sever joint tenancy  Thus, once leasing joint tenant dies, the lease terminates because the joint tenant cannot convey a bigger interest than he has and his interest now remains in the surviving joint tenants

Tax sales

Most states hold that he's acting as a co-tenant and the others can remain co-tenants by contributing their share of the taxes or mortgage within a reasonable time • Some states hold that if the others have the opportunity to bid, the purchasing tenant wins it for himself

Ouster of a Concurrent Tenant

No solid rule on what actually constitutes an ouster o Some jurisdicitons hold that telling concurrent tenant that you "don't want them on the place" is an ouster, but some other jurisdictions hold that threatening to call the police to have a concurrent tenant removed is not an ouster o some jurisdictions hold that changing the locks on a co-tenant is an ouster o Case Law: In re Estate of Hughes - man owned a house as a tenant in common with his wife; his attempt to get 100% interest in the property despite interest remaining in his deceased wife's children (due to will) after she died constituted an ouster • Ouster can signify the beginning of "adverse and hostile" or "open and notorious" possession for adverse possession purposes

obligations of life tenants

Obligation to make ordinary repairs o Case Law: In re estate of Jackson - holding that when life tenant died w/o having made repairs to the house from storm damages, the storm insurance proceeds should have gone to the holders of the residual interest instead of to the life tenant's estate  Rationale: 1) life tenant failed obligation to make repairs; 2) since holders of the residual interest are the ones who are now in possession of the house, they should get the money needed to fix it

Modern Real Estate Transactions

Overview: Components of a Modern Real Estate Transaction • 1) Presentation of a Written Listing Agreement • 2) Offer • 3) (sometimes) prospective buyer may put down earnest money before the negotiations start as a form of security • 3) Acceptance • 4) Escrow agent may be set up to serve as an intermediary between the buyer and seller o Buyer will be obtaining permits and financing agreements o Seller will be clearing defects from the title and making any necessary improvements to the property • 5) upon completion of each side's obligations, sale will close and the deed will be given to the buyer

When Does Govt.'s Permanent Physical Occupation of Land Constitute a Taking?

Permanent Physical Occupations Absent Any Benefits Conferred by Govt. • These are automatically takings • Rationale (Loretto) o Violates every stand of property rights  Right to possess - you have no ability to possess or exclude someone from an occupied space on your property  Right to use - you cannot even make nonpossessory use of occupied space  Right to dispose of property - even if you dispose of occupied space, the new purchaser will also be unable to use that occupied space o Represents complete dominion and control over property o Avoids difficult line drawing problems (i.e. permitting someone else to install a huge swimming pool on the rooftop is a taking, but if smaller installations were not, where would you draw the line?) • Case Law: Loretto v. Teleprompter - SCOTUS holding that govt. statute requiring landlord to permit installation of a 30 ft. cable and two 4-inch square boxes on his roof was a taking • Exceptions o State laws requiring landlords to provide tenants with many kind of access services and appliances i.e. sprinklers, smoke alarms, running water, lighting, door bells, fire escapes, mailboxes, etc.  Rationale for the distinction: In Loretto the landlord actually had to let a third party come onto his premises and install its own cable box rather than having control over the item (i.e. deadbolt, doorbell) installed on his premises and being able to install it himself - there seems to be more of an invasion in the former case Unilaterally Imposed Easements on Private Land (Opinion of the Justices) Exactions Conditioned on Permits Granted by the Government Rule • Main rule: A government's conditioning a permit for use of land on the landowner's agreement to a regulation that significantly restricts or permanently occupies the land is a taking when there is no substantial nexus between the condition substituted for denying the permit and the end that would be advanced by denying the permit (Nollan, Dolan) o Rationale - it is legal for the govt. to deny the permit altogether for reasons relating to the public interest when the use of the permit would endanger that interest; but when a condition is imposed that serves an interest which the use of the permit would not endanger, this would allow the government to make an end run around the 5th Amendment by forcing landowners to agree to takings in exchange for unrelated permits (Nollan - Scalia majority opinion); this would equate to a denial of substantive due process under the 5th/14th amendment o Case Law: Nollan v. California Coastal Commission - SCOTUS holding that the government's conditioning the grant of a building permit to P on the grant of a public easement over the land would constitute a taking  Rule Application: interest endangered by use of the permit = view of the ocean/beach; interest served by the easement = walking across the beach; result = no nexus between the two interests • Corollary to the rule: there must be a "rough proportionality" between the impact of the dedication and the extent of the impact of the dedication, even if there is a nexus between the interests (Dolan, Rehnquist majority opinion) o Case Law  Dolan v. City of Tigard - SCOTUS holding that conditioning the grant of a permit for expanding/redeveloping a plumping/electric store on the dedication of part of the property in a floodplain for a storm drainage system which doubled as a public greenway (path that the public can go through) and the dedication of another strip of land for a pedestrian bicycle pathway was a taking b/c these dedications were disproportionate to the impact caused by expanding the store  A private greenway could have been established to maintain a storm drainage system as long as maintenance workers could have come on, but it was disproportionate to establish a public greenway where people could also come and use the area for picnicking  Counteargument: Stevens dissent notes that we don't know the monetary harm to the landowner from these dedications; the dedication may have actually increased value to land (potential customers going by the store, no tort liability, maintenance, or tax liability for owner); this amounts to judicial micromanaging of legislative decisions  Ehrlich v. Culver City (1996) - California Appellate Court holds that requiring a "recreation fee" of $280K in exchange for granting an application to replace a commercial recreation center with condos is an exaction that is disproportionate to the impact of the conversion, as the recreation center was already failing commercially • Limits to the rule o does not extend to denial of permits to build, only to exactions  Case Law  City of Monterey v. Del Monte Dunes (1999) - SCOTUS holds that "rough proportionality" test does not relate to complete denial of permits; however, the Court upholds a verdict in favor of the developer because there was no "reasonable relation" b/w the denial of the permit and a "legitimate public purpose"  Ehrlich v. Culver City (1996) - California Appellate Court holds that requiring a "public art fee" of $33K in exchange for granting an application to replace a commercial recreation center with condos is a form of aesthetic regulation and not an exaction o Does not apply to determining whether anything is a taking per se (proper rules are ones like the permanent physical invasion, regulatory taking, land-use exaction rules, etc.) but only to when a condition imposed upon the discretionary grant of a land-use permit is a taking (Lingle v. Chevron)  Case Law: Lingle v. Chevron (2005) - SCOTUS holds that the "substantially advances a govt. interest test" should not have been applied in lower court determining that the govt.'s imposition of rent controls on owners of gas stations' rents charged to lessee - dealers was a taking  "substantially advances" is a substantive due process question, not a takings question  As long as there's a rational basis, you go to the takings question

Types of Mortgages

Purchase money mortgages - often used in sales of real estate • Construction loan mortgages - used when MR wants to buy land and build a house o ME makes loans in installments - he only advances further money as the house is being built (so that the amount loaned is never greater than the security interest)

Private Discrimination in Selling Property

Racial Discrimination 42 U.S.C. §1982 • Rule: a seller cannot refuse to sell property to a buyer because of a buyer's race due to 42 U.S.C. §1982 o Case Law: Jones v. Alfred H. Mayer Co - SCOTUS holding that Congress barred such an action under the above statute, which was enacted as an exercise of Congress' 13th Amendment power to enforce the provisions of the amendment's ban on "badges of slavery" through legislation o **Note: It is the legislation, not the amendment itself, which proscribes the practice Federal Fair Housing Act (FFHA) • a) bans the refusal to sell or rent after making a bona fide offer or the refusal to negotiate on basis of race/color/religion/sex/national origin/familial status • b) bans discrimination in the terms/conditions/privileges of a sale or rental of a dwelling on such a basis • c) outlaws advertising that you make or intend to make preferences on such a basis • d) outlaws telling people that a house is unavailable when the house is actually available • e) outlaws "blockbusting" - trying to make a profit by inducing someone to sell or rent their houses by telling them that minorities are moving into the neighborhood o Exceptions  A person who does not own more than three single family houses at once time can sell or rent a single family house w/o this law applying provided that he does not sell more than one house that he is not residing in every 24 months  He cannot use any sales or rental facilities or the services of any real estate agent  He cannot advertise/publicize racist preferences in violation of part c)  A person renting rooms in a living quarters occupied by at most four families living independently of each other and who lives in one of the rooms can rent the other rooms w/o this law applying • Prohibits discrimination in the extension of credit involving real estate transactions • Prohibits discrimination in the membership of real estate brokers' organizations Other rulings • Courts have not allowed homeowners' associations to exercise rights of first refusal as a means to block minorities from moving in (Phillips) • Courts have not allowed landlords to maintain racial quotas in renting out apartment complexes to preserve racial diversity (U.S. v. Starrett City Associates) Discrimination Against the Handicapped 42 U.S.C. §3604 • Sellers cannot discriminate against buyers or renters on basis of handicap • Sellers cannot discriminate in the terms, conditions, or privileges of sale or rental based on handicap • Discrimination includes o Refusal to permit, at expense of handicapped persons, modification of premises to make them accessible/useable o Refusal to make reasonable accommodations Limits • Does not extend to people searching for roommates or sites helping people find roommates (Fair Housing Council v. Roommate.com)

Eviction (Unlawful Detainer Action)

Rationale • In common law, the landlord did not have this right absent an express termination clause; the covenant was independent from the tenant's obligations o Landlords resorted to conditions in the leases to give them the right to terminate  Fee simple determinable estates - tenant holds the land "until" a condition happens, then the possibility of reverter kicks in and the lease automatically terminates  Fee simple estates based on condition subsequent - tenant holds the land, "but if" a condition happens, the landlord has the right to re-entry/power of termination and can take back the estate o Why would you choose a right to re-enter over an automatic termination?  Automatic termination may eliminate the power to collect any rent • Today, lease covenants are regarded as dependent covenants and the landlord's power to terminate is included in the dependent covenant • If tenant violates certain obligations (i.e. to use the premises as specified or to pay rent or to not commit waste or nuisance, he no longer has a legal right to stay in the property When Can L evict T (assuming T does not cure)? • Material Breach of a specific requirement/dependent covenant in the lease • Failure to pay rent • Waste • Expiration of a fixed-term lease • Refusal to leave after lawful termination of periodic tenancy or tenancy at will • Tenant abandonment Though if tenant never abandoned, or the tenant can file a wrongful eviction

Regulatory Takings

Regulations That Almost Completely Eliminate the Property's Commercial Value • Case Law: Lucas v. South Carolina Coastal Council (p. 1168) - SCOTUS holding that state restrictions on building habitable structures on P's plot of land rendered his land valueless and was thus a taking because the prohibited action was not an action that would constitute a nuisance under common law o Counterarguments  1) common-law nuisance restrictions are far too narrow to confine a state's power to regulate w/o compensation  2) nuisance law is too complicated and ambiguous  3) this freezes the state common law and deters courts and state legislatures from altering nuisance law when it becomes outdated  4) we should leave it to legislatures, not 19th century judges, to determine when a use is so harmful that it must be prohibited without compensation  5) how do you calculate when something has been rendered "valueless?" This is subjective and depends on the denominator  6) it is arbitrary that you would not compensate anyone whose property is diminished 95% but compensate fully someone whose property is diminished 100%  7) courts may get around the new rule by redefining the denominator  8) investors and developers may take advantage of the Court's new rule by making the estates and rights as small and specialized as possible (to reduce the denominator so that any restriction takes away the entire right)  9) rule creates a moral hazard by "insuring" property owners against certain land use regulations (after which they will need to be compensated); this encourages overinvestment and building anywhere despite the risks (though you could say that FEMA already provides this insurance by paying people when their houses get leveled by coastal floods)  10) hard-line rules when unnecessarily tie the hands of zoning commissions who must deal with complex problems • Case Law: Pennsylvania Coal Co. v. Mahon - SCOTUS holds that PA statute which forbids mining that causes subsidence of houses resulted in a taking of the coal of a coal company which reserved a right to mine the coal underneath the house of grantees it had deeded land to o Mining of most of the coal was now commercially impracticable; it had no value remaining in the ground so the regulation had nearly the same effect as appropriating or destroying it o **Some amount of regulation is ok, but this went too far and constituted a taking o Holmes also notes that the public benefit here isn't high enough o Denominator Dispute  Argument in favor of calling it a taking (Holmes) is that the property that is impacted (the % of coal that cannot be mined) is the only property that is relevant to the analysis of whether a taking has occured  Argument against calling it a taking (Brandeis) is that the property must be viewed in the whole - there is still coal underneath the house that can be mined, so the entire value of the property has not been eliminated Regulations Where the Govt. Devalues Property Through Its Own Use of the Property • Case Law: U.S. v. Causby - SCOTUS holds that govt. flying planes above P's chicken farm, which made operation of the farm impossible, constituted a taking b/c the govt. was not merely reducing the value of the property but was also using it for its own planes

Acquiring Easements By Prescription

Requirements • 1) actual use (need not be exclusive) • 2) adverse use - must violate the owner's property rights • 3) open and notorious use • 4) continuous use • 5) for the statutory period • **note: in CA, you do not need to pay taxes over that piece of land to establish a prescriptive easement • Case Law: Dieterich - P had acquired a prescriptive easement over D's truck stop against the life tenant by driving over its property for 21 years to get P's trucks into P's repair bays

The Sales Contract

Requirements • Must be written: either formally or in a memo o Though personal property doesn't have to be in writing. It can just be handed over o Exception: A party to an oral agreement (not satisfying SOF) who has made part performance that indicates existence and general content of the agreement may seek specific performance if two of the following are met:  Possession of the land  Making substantial improvement to the land  Payment of all or part of the purchase price • Description of property o Some states are stickier about description of property than others, and require a full legal description. Others allow you to use just the address. • Identification of the parties of the contract • The price and manner of payment • Signature of person to be bound • Closing date • May have conditions that one party has to meet before closing o "Subject to financing" clause for example o May have condition that buyer should obtain necessary permits from authorities before sale is completed  **Note: such conditions often imply a good-faith obligation on the buyer's part to seek out financing or permits  Case Law: Sechrest v. Safiol - buyer cannot get his security deposit back from seller because he did not met his good-faith obligation of attempting to procure necessary construction permits from authorities • **An implied warranty of marketability of title is presumed in every contract for sale of real property o However, this can be altered by the parties to simply be changed from marketable title to insurable title, or even to no title at all

Vested Interests

Requirements for a "vested" interest o Owner is ascertained o Even upon which it will become possessory is certain  Exception: Event that triggers a possibility of reverter or right of re-entry is not certain, and a reversionary interest may be defeasible - however, these are still considered vested interests because all interests retained by the grantor are considered "vested" interests not subject to the Rule Against Perpetuities o Example: "To A for life, remainder to B" - B has a vested remainder

The Recording System

Resolves conflicting interest in property o When the same land has been conveyed to multiple people o When two people are disputing whose interest has priority over the other (i.e. whose easement or lien or mortgage comes first) o If they both have interests and want to resolve whose interest is bound by the other's • When there is no applicable recording statute, "first in time" gets "first in right" • Recording acts determine validity and priority of conflicting interests o Potential purchasers can search the records to establish that the title is good o Laws punish those who fail to follow standard recording and searching procedures • Who does the system help? o Purchasers o Sellers o Tax collectors o Creditors o Debtors • System is not mandatory but if you don't record your title to the land or a conveyance, you could lose the land

Unenforceable Covenants Due to Bad Public Policy

Restatement § 3.1: the following covenants are not allowed • Arbitrary, spiteful, or capricious servitudes • Servitudes that unreasonably burden fundamental constitutional rights • Servitudes that impose unreasonable restraints on alienation • Servitudes that enforce unreasonable restraints on trade or competition • Unconscionable servitudes

Modification of Covenants

Retained Power of Modification in Original Covenant • Developers, homeowners associations, or owners of common interest communities often retain the power to modify the covenant o Rationale is that when you buy into a common interest community, the expectation is that you should expect to contribute to maintaining common areas for the benefit of all community members o But courts often protect minority of owners or residents from modifications that unfairly shift burdens onto them or benefits to the majority (i.e. changing basis for allocating assessments) o Case Law:  Rick v. West (p. 1044) - holding that developer's right to modify a covenant against non-residential use of the property by making "exceptions in certain cases" did not extend to the non-residential use of 15 out of 62 acres when he tried to sell a subdivision to a hospital  Evergreen Highlands Association v. West (p. 1050) - holding that homeowners' association had right to create new covenant to impose an assessment on homeowners of $50/yr for maintaining a 22-acre park open to all residents because: 1) amendment was made according to modification clause in original covenant that P subdivision owner had notice of; 2) assessment was not unreasonable or burdensome; and 3) purpose was to maintain common elements of a subdivision; moreover, even in the absence of an express covenant; the association, as a common interest community, would have the implied power to levy assessments against lot owners to maintain common areas  P would have been a free rider if he didn't have to pay the assessment while still being able to enjoy the park Changed Conditions Doctrine • Restatement § 7.10 o (1) court can modify covenant when a change occurs that makes it impossible as a practical matter to accomplish servitude's purpose; court can modify to permit the purpose to be accomplished o (2) court can modify when a change occurs that makes the servient estate no longer suitable for the uses permitted by the servitude (even if the purpose can be accomplished); court can modify to permit other uses in order to preserve benefits of the original servitude o (3) Exceptions: does not apply to modification or termination of conservation servitudes held by public bodies and conservation organizations • Massachusetts Rule (most favorable to party seeking modification) o Injunction will not be enforced (only damages) in cases of:  Changed conditions  Even if there's benefit, if continuation of the restriction would impede reasonable use of the burdened land for the purposes for which it is most suitable  enforcement would not be in public interest • generally the changes that occur to the surrounding area need to be changes that significantly affect the purpose of the servitude • Case Law: Rick v. West (p. 1044) - holding that developer could not modify self-imposed covenant against non-residential use by selling 15 out of 62 acres of the property to a hospital when a subdivision owner on the property had relied on the restrictions in buying the lot and when the character of the neighborhood had not changed significantly enough to warrant a modification o There had been changes, but most happened before 1956, when the covenant was imposed o There had been two commercial establishments since that had not reduced the value of the covenants because those establishments had not created a hassle for the defendants' at all

Laws for structurally supporting others' land

Right to Support • Lateral support - right of a landowner to support in a vertical plane by adjoining lands owned or occupied by others; must be the support that would have existed in land's "natural state" o A person is strictly liable for removing lateral support if damage to the adjacent land occurs as a result (i.e. if you remove a rock face on your land and your neighbors property landslides)  Is also liable for damage to buildings on that land • Subjacent support - landowner's right to support in a horizontal plane against underlying strata of earth owned or occupied by others; must be the support that existed at the time of the severance of the land o i.e. o Exception: removal of underground water o B/c it is hard to show that P's land would not have subsided but for P's buildings placed on top of the land and the burden of proof is on the defendant to make this point, the defendant is usually liable for land that caved in due to weight from buildings, regardless of when the buildings were added

When Do Govt. Land Use Regulations Constitute Takings?

Rough Factor Test for Determining Whether Something is a Regulatory Taking (Penn Central Transportation Co. v. NYC) • 1) economic impact of taking • 2) diminution in value to property owner/can the property owner still get a reasonable return? • 3) has regulation interfered with investment-backed expectations • 4) character of the govt's action (including whether there is a physical invasion) • 5) purpose of the government's action • 6) is the regulation part of a public program adjusting the benefits and burdens of economic life to promote common good • 7) is the property owner being singled out to benefit the rest of the population?

publicity factors

Rough Factor Test for Right to Publicity • How Much Does The New Work Transform the Character's Identity or Likeness? o Depends on whether you are replicating features of the person themselves, not just the character they play or the role they serve on TV • Would the new work usurp the market for the original? o Militates against permitting use • Is the New Work a Form of Artistic Expression? o Militates toward permitting use o Case Law  Tiger Woods case - D was allowed to sell paintings of Tiger Woods at the masters  Dustin Hoffman case - D was allowed to publish photos with Dustin Hoffman's head pasted over that of a model • Is the New Work Related to News, Politics, or Satire? o Militates toward permitting use

When Do Judicial Decisions on Property Rights Constitute Takings?

Rule • When a court invalidates the recognition of a previously existing private property right, 4 SCOTUS justices (Scalia, Roberts, Thomas, Alito) have held that the ruling constitutes a taking from whoever previously held that right (Stop the Beach v. Florida Dept. of Environmental Protection) • Challenger has the burden of showing that the property right previously existed Case Law • Stop the Beach (2010) - SCOTUS holds that there was no taking by FL Supreme Court in holding that Ps were not entitled to just compensation after the govt. re-classified the boundary line to their waterfront property and cleared out land below the line through the process of avulsion because Ps never had littoral property rights to land that the state cleared out through avulsion (sudden additions to the land); only rights to land cleared out through accretion (gradual and imperceptible additions to the land) • Hypothetical o What if a state court invalidates a common law right to publicity? Would they have to compensate people for taking away this right?

Nuisance

Rule: A substantial interference with the use and enjoyment of land that is intentional and unreasonable o Public - you must show that you have suffered a wrong that is distinct from other members of the general public at large - relates to the deprivation of use/enjoyment of a right that you have as a member of the public o Private - relates to the deprivation of use/enjoyment of a property interest that you have • Coming into Nuisance: Buying property when nuisance is present weighs in favor of D • Just because an act conforms to a zoning law does not mean it is not a nuisance • **If utility of D's action outweighs gravity of harm caused to P, that can be a ground for finding no nuisance • **Note: you can be held liable for the actions of 3rd parties on your property if you are aware that they are causing such disturbances and you do not make a substantial effort to stop it (Mark v. Dept. of Fish and Wildlife) Who Can Bring Actions For Nuisance? • Landowner • Anyone with a possessory interest (i.e. tenant) • Anyone with another proprietary interest that is being violated (i.e. owner of an easement Examples of Nuisance • Harms from light, sound, dust, etc. • environmental harms from landfills • maintenance of crack houses • maintenance of halfway houses • erection of fences, billboards, walls by one property owner to maliciously harm another neighboring property owner • lewd, public nudity and sexual activity (Mark v. Dept. of Fish and Wildlife) Remedies • Injunction: If substantial damage from nuisance is shown • Permanent Damages: If the benefit of the conduct does not outweigh the harm enough to declare "no nuisance," but ending the conduct would place a huge burden on D or society. i.e. Shutting down factory (loss of investment/jobs). (Boomer v. Atlantic Cement) o Acts as a servitude on land—the nuisance payment will run with the land o This may be a taking because you are allowing A to buy an interest in B's property (Continue Nuisance for payment) o Rationale: An injunction that cost the violator a huge amount of money could only be released once the violator paid the plaintiff to release the injunction; plaintiff would get a windfall b/c the violator would pay anything less than the amount they would lose by having to suspend their activity  Counterargument  damage award set by the court allows the violator to pay a licensing fee for the nuisance  this licensing fee is an unconstitutional imposition of a servitude on the harmed party's property w/o their consent; normally the govt. must justify this under the 5th Amendment due to a public use/public purpose • Continuing Damages: If the nuisance was temporary or this will cause party to stop

Joint Bank Accounts

Signature Card is Often Not Dispositive of Intent • Signature card usually states that any party to the account may withdraw all the funds and that on one's death, the remaining funds belong to the survivors Courts will admit other evidence of donor's intent • "true joint tenancy" o When donor intends that other person can withdraw half the money in the account and on his death the balance belongs to the other person • Will substitutes, non-probate transfers, "pay on death" accounts o Donor does not intend that the other should be able to withdrawn funds during his lifetime, but upon his death, balance shall go to the other person • "Convenience" account or "Power of Attorney" account o Donor wants to give the other person access to pay donor's bills only in the event that the donor is incapacitated; balance does not go to the other person upon the donor's death o Banks don't like this because once the donor dies, the bank has to pay instead of the other person - the bank's liability is thus higher

Treasure Trove

Similar to lost property: finder has a right to the treasure trove against everyone but the true owner • When descendants of the previous owner claim ownership of long lost property that was involuntarily taken from their control, the finder must prove abandonment by clear and convincing evidence o Case Law: Columbus-America Discovery Group - court rules that D insurance companies had not abandoned their interest in sunken treasure after a shipwreck; the salvor (finder) is to receive a salvage fee as compensation to its service but does not receive title for its sunken treasure

Community Property

Specific type of property in California • Just like tenancy by the entirety (must be property acquired by couples who are already married), but it is devisable by will and leaves the devisee and the surviving spouse as tenants in common o Example: Husband + Wife buy a house; upon death, husband's will states that his interest goes to his son; the son and the widow now own the house as tenants in common

Remedies In An Action for Conversion

Sue for conversion - court will force the wrongful possessor to buy the chattel from you • Sue in replevin - court will force wrongful possessor to return the chattel

Tenant's Possible Defenses to Eviction Proceedings

Tenant never breached • T cured within necessary time • L breached implied warrantee of habitability (Knight v. Halsthammar, Green v. Superior Court) • L was constructively evicted • T did not leave at end of lease due to emergency (i.e. sickness) • L waived notice to quit • L is guilty of retaliatory eviction o Landlord cannot evict in response to tenant exercising legal rights o Retaliatory evictions include:  Increasing rent  decreasing services  causing tenant to quit the rental property involuntarily o a tenant may not waive this right o Tenant must prove retaliation by preponderance of evidence o Landlord can prove good faith o Retaliatory Action must occur with 180 days of exercise of right o May only be asserted once in a 12 month period o Tenant would be entitled to compensatory and punitive damages • Eviction is due to discrimination (prohibited by federal and state law)

Who Can Bring Action for Wrongfully Taken Property?

The original owner can bring action against either the finder or a third party who took it from the finder o However, Restatement of Torts says that if the finder brings an action against a third party for possession and wins judgment against the third party, that extinguishes the owner's cause of action against him • The finder can bring action against a third party o Case Law: Armory v. Delamirie - finder chimney sweep boy brings action against third party goldsmith  Goldsmith's jus tertii defense (right of third party to the property) doesn't apply • A bailee can bring action against a third party o Case Law: The Winkfield - bailee Postmaster General brings action against third party for lost mail

Who is Liable for Wrongfully Taken Property?

Third party is liable to finder, original owner, and bailee o Third party's employer is liable to the same extent the third party is under the respondeat superior doctrine (employer is liable for the actions of his employees) • Finder is liable to original owner

Destruction of Premises (Almost Exclusively Commercial Problem)

Traditional Rule • Even if whole premise is destroyed, tenant not relived of duty to pay rent o Idea was that people wanted land for its own sake rather than improvements  Unless tenant undertook risk of loss Modern Rule • Complete destruction of premises terminates both landlord and tenant's obligations o Exceptions  Was risk of loss explicitly allocated in the contract? This can change the result  Does tenant has an interest in the landlord's insurance? If the tenant has no interest, the landlord may have the right to terminate the lease in the event of substantial damage • Rationale o Soil is not as important as the house or retail space on it—so destruction can be a basis for not paying rent o Impossibility of Performance  When it has become impossible for the landlord to provide what was leased for, his duty may be relieved. And thus the duty of tenant to pay rent  Unless they contracted to shift risk o Frustration of Purpose  Applied when the purpose for which the lease is made is nearly or totally destroyed during its term  Case Law - Albert M. Greenfield v. Kolea - T was renting two adjoining lots, one to house cars and other to sell them out of. One is destroyed and the whole purpose of the lease is unable to be performed - T's obligations were terminated

Mortgagee's Security Interest: Title Theory/Lien Theory

Traditionally: Title Theory o Banks owns deed to property subject to condition subsequent  Condition: You stop making payments o Acceleration Clause: When you fall behind entire balance comes due o Once you finish payment the condition becomes extinguished and the deed destroyed • Modern: Lien Theory o Bank has a security interest in the property rather than any outright ownership • Essentially both work the same because Title-Theory States enforce in a similar manner

Divvying Up Occupancy Rights to Property

Under CA law, tenants in common can establish separate agreements to provide exclusive rights to occupancy for individual tenants over individual parts of a property (Tom v. City of San Francisco) o Prohibiting such agreements would violate CA Constitution's right to privacy

Tenant's Duties

Uniform Landlord and Tenant Act • Comply with building and housing codes • Keep premises clean and safe and dispose of garbage in a safe manner • Use all the facilities and appliances in a reasonable manner • cannot deliberately or negligently destroy any part of the premises or permit someone else to do so • Cannot disturb his neighbors' right to quiet enjoyment

Not Regulatory Takings

Use Restrictions That Preserve a Reasonable Return on the Property and Are Part of a Reasonable, Comprehensive Plan • Rationale: Govt.'s ability to promote public health, safety, morals, and general welfare would be severely inhibited if they had to pay property owners for every such law which diminished their property values • Case Law: Penn Central Transportation Co. v. City of New York - SCOTUS holds that NYC "Landmark Law" which designates Grand Central Terminal, owned by P, a landmark, and prevents P from constructing an office building above the terminal, is not a taking o Property was devalued but P could still make a reasonable return by using the property as it was being used in the present  NYC also gave P transferable development rights to 8 parcels in the vicinity of the terminal o The Landmark Laws were also comprehensive and did not single out P but applied to over 400 individual landmarks in the city, many of which were close to the terminal Destruction of Property that is Necessary to Save More Valuable Property • Case Law: Miller v. Schoen - SCOTUS holding that a state order that P destroy his diseased cedar trees to prevent disease from spreading to an apple crop was not a taking that required just compensation Temporary Physical Invasions • Case Law: PruneYard Shopping Center v. Robins - a shopping center had to let citizens come onto the premises for the circulation of petitions; they also had not demonstrated any financial loss from allowing the citizens on the premises

Foreclosure

Used when MR fails to repay his loan to ME • Property is sold o Usually by judicial sale in most states o In other states, ME themselves can sell property • ME takes as much of the proceeds as is necessary to reimburse themselves, and gives MR remainder • MERS Article o MERS is a company that keeps electronic records of who has title to mortgages; was created to keep track of the various assignments of mortgages o Except MERS started foreclosing on mortgagors itself even though it often lacked legal right to do so, since it did not own the mortgage itself o MERS claimed title to as many as half the outstanding mortgages in the country

Did seller deliver the deed to the buyer?

Was it delivered as a manifestation of an intent to make the deed operative and pass an interest immediately? o Presumption that delivery was successful when:  Deed is handed to the grantee  Deed is acknowledged by the grantor before a notary  Deed is recorded o Once the deed has been delivered, it cannot be cancelled - you have to draw up a new deed to give it back • Did the deed contain a provision that it is to take effect only on the happening of a condition? o One view: This is not delivery and the deed is void o Another: The deed is intended to be legally effective now, but passes an interest subject to a condition precedent  This creates a springing executory interest in the grantee  Examples:  Good: "O to A, reserving life estate in O"  Maybe: "To A, effective on my death"  When "effective" means that it should not be executed on death, it's void  When "effective" means "effective to transfer possession," it's valid • What if grantor retains a power to revoke? o Majority view: Creates a present interest in grantee that can be revoked, because if it's a written, signed, delivered deed, that's really strong evidence that the grantor wanted it to be effective o Minority view: Grantor must surrender dominion and control for there to be effective delivery o Case Law: Chandler v. Chandler - transfer of deed to a bank with unequivocal written and oral instructions to give the deed to grantor's son upon grantor's death constituted a valid transfer; grantor never went to reclaim the deed from the bank and it mentioned nothing about a power to revoke  Dissent - the fact that the grantor could have revoked until he died meant that there was never a transfer • Oral conditions are void • Was the deed given to a 3rd party custodian (i.e. an escrow agent)? o Is the escrow donative?  Once it's handed to the agent, it's irrevocable and the agent must deliver it on the condition  Grantee has future interest  Technically springing executory (divests grantor of their interest)  But sometimes classified as a remainder  If it's revocable, no delivery takes place and it's void because it's not beyond the grantor's control o Or is it commercial?  Written instructions make it irrevocable  Oral instructions  Majority view - are revocable (because of the Statute of Frauds) unless there's a written contract of sale  Minority view - are enforced because the deed is a conveyance not a contract, and delivery is a question of intent, which can be proved by parol evidence

Landlord's Remedies

What can the landlord do when the tenant does not pay rent? o 1) Can evict, accept tenant's surrender, and collect past due rent until time of termination, plus any extra damages caused by the breach (Cal Civil § 1951.2)  Under traditional view, this terminates any obligation on the part of the tenant o 2) Can evict, find another tenant, and collect difference b/w the new tenant's rent (market value) and the old tenant's rent (presumably a higher amount), plus any extra damages caused by the breach - this represents the expectation damages under contract law (Cal Civil § 1951.2) o 3) Can continue trying to enforce the lease as it stands • What can the landlord do when the tenant stays in possession but does not fulfill the obligation to repair? o Landlord can sue for specific performance o Landlord can sue for monetary damages to the reversion  However, L cannot sue for cost of repairs w/o terminating the lease and the lease has not expired (Avalon Pacific)  Exceptions  when cost of repairs is less than the diminution in value to the reversion  when the landlord has already made the repairs and is seeking to get reimbursed o Landlord can evict tenant for breach of a dependent covenant or forfeiture clause In event of abandonment by tenant • 1) landlord can take back leased premises and accept surrender - tenant has no liability for any rent not yet due • 2) landlord can ignore abandonment and continue to hold tenant liable under term of original lease o Minority rule - tenant's abandonment does not require landlord's acceptance to constitute an end to the lease (Kelly) • 3) landlord can re-lease to a new party and hold tenant liable for difference between the rent left over in the original lease (presumably higher) and the new rent for the same period o However, assumption of control over premises may be interpreted as accepting tenant's surrender, which can remove tenant's liability In the event of forfeiture by tenant and subsequent termination by landlord • Landlord can include provision stipulating that once the lease is terminated, they can re-rent the premises to another party and recover from the tenant damages equivalent to difference between the rent left over in the original lease (presumably higher) and the new rent for the same period

Exclusive Possession By One Co-Tenant

When only one co-tenant is in possession of the property (because other voluntarily left) o Majority rule  Tenant in possession does not have a duty to pay rent to co-tenant  However, majority rule also is that tenant out of possession may also claim credits/offsets for the value of the occupying tenant's use that will reduce the carrying charges (i.e. utility fees, taxes) on the property • When one co-tenant ousts the other co-teannt o Co-tenant in possession must pay the other co-tenant the reasonable rental value of the property lost by the ousted co-tenant

Surety

When the lendor doesn't think you might have enough credit on your own - he makes someone else sign on the loan for you and guarantee that you will pay off the loan • If you don't pay off the loan, the lender may be able to go after the guarantor of the surety

index

Which Index to Select To Discover If You Are Purchasing Land in Good Title • Use grantor-grantee index or tract index • When using grantor-grantee, search the person as a grantor (to ascertain if there are competing conveyances that they made) and as a grantee (to see if they if/where they got the property) To Discover All the Land A Particular Person Owns in a County • Use grantor-grantee index How to Use Indexes Grantor-Grantee Index • Used to discover any grants that someone has made to others (grantor) or that someone has received from others (grantee) • Useful for discovering all the real property someone owns in a county • 1) Grab grantor or grantee index book with first letter of the grantor or grantee's last name • 2) find the name • 3) in grantee index, you will find the volume/page at which the deed to the grantee is copied in full as well as a brief description of the property; in the grantor index, you will find a description of any conveyances the grantor made Tract Index • 1) look at map of the county in recorder's office to determine the number of the block in which your land is • 2) ascertain your lot number within the block • 3) go to index volume for conveyances of land within your block and find the page that references conveyances relating to your lot number • 4) page has a list of the conveyances regarding your lot from the date the index was established, as well as a reference to the volume/page where the documents are copied in full Combination Tract/Grantor-Grantee Index • 1) First locate your numbered block on a map of the county • 2) Go to index volume for that block; conveyances are indexed by the names of the parties Find the Root of Title • Refers to when the land was first conveyed, usually by the government to a private entity • Once you have worked your way back to the root of title, you can start working your way forward to the present Potential Obstacles With Indexes • No provision for indexing the passage of title upon death of the owner; if there is a gap in the index, it is probably due to the fact that title has passed by descent or devise

ratione soli

by ownership of ground; landowners have constructive possession of wild animals on their prop until they escape  Case Law: Keeble v. Hickeringill - D liable for firing a gun to scare away ducks in P's pond; ducks P was using for his livelihood • What Constitutes Unlawful Interference With Animals on Someone's Property? o Cannot maliciously interfere with the rights of someone else to make a livelihood on his own land (Keeble) o Cannot trespass o But you can interfere through traditional business acts (i.e. having a better way to lure ducks to your pond)

study covenant charts

covenant charts

capture for animals

need dominion and control or mortal wounding and intent to possess o Case Law: Pierson v. Post - fox belonged to the party who mortally wounded it and captured it, not the party who was in pursuit of it when the other party intervened

Benefits of Getting Official Copyright Registration

o A public record o Certificate of registration o Allows you to receive from the Customs Service notice of the importation of knockoffs

Law of Fixtures

o Determines whether, at end of term, tenant can remove articles affixed to the property or whether they should remain to the landlord o If the property is a fixture, the articles are attached and cannot be removed - doing so would be waste o Court may rule a property a fixture if it was attached with the intent of becoming permanent (from an objective standpoint) o Courts are hesitant to find property as fixtures (because tenants don't normally intend to just improve the property for the landlord's benefit) o Trade fixtures  Machinery used in businesses  Can be moved by the tenant regardless of the objective intent o Removal of an article that substantially damages the property is permissible under the Restatement as long as the property is restored within a reasonable time

What if there is no record title?

o Seller can show by clear and convincing evidence that he would win a quiet title action  **Note: while filing a quiet title action prior to sale to establish good record title is preferable, it is not necessary - seller just needs to establish that he would win  Case Law: Conklin v. Davi - seller has burden of proving title by adverse possession in order to demonstrate marketable title o Additionally, seller may be required to furnish written evidence or some other evidence which buyer can later use to defend his title if someone files a claim against him

Capture

o Unlimited right to acquire, so long as the resource was obtained without trespassing in another's property o Some courts have imposed a reasonable use requirement for things like water (Cline) • Rationale: Encourages competition/ efficiency. Clear way to determine an owner

Inquiry notice

purchaser would know about a prior conveyance if they reasonably inspected the physical property and made inquiries about the ownership based on what they found • Case Law: Sanborn v. McLean (p. 759) o Owner of a series of lots deeded several of the lots with the restriction that only residences would be built on the lots o Afterward, he deeded D a lot without this restriction in the deed o D tried to build a gas station on their lot and P, an adjoining property owner, sued to enjoin the construction of the station o Holding: Doctrine of implied reciprocal negative easements prevents D from building the gas station  Doctrine means that an owner of the land grants land with restrictive easements on it, these restrictions also apply to the land retained so that he cannot do on his land what he forbids others to do  These easements run with the land  D had constructive knowledge of the easement, and hence inquiry notice, because his abstract of title showed that all the lots around his own lot were residential; inquiring about this fact would have revealed that his lot was subject to a reciprocal negative easement

adverse possession personal property

• ) Actual and exclusive use • 2) adverse and hostile use • 3) claim of right • 4) open and notorious use • 5) continuous use • 6) for the statutory period

What is Patentable?

• 1) Any new and useful process, machine, manufacture, or any composition of matter, or any new and useful improvement thereof o i.e. you could patent a new and innovative recipe for making sugarless desserts which are usually always made with sugar (i.e. pastries, cakes, etc.) o Case Law  Bilski - SCOTUS rules that business methods can theoretically be patented, but the disputed method here (a way for commodities traders in the energy market can hedge against the risk of price changes) is not patentable because it is an abstract idea  Diamond - SCOTUS rules that a living organism that was artificially created can be patented • 2) The thing being patented must have actual utility

Extent of Trademark Protection (Lanham Act)

• 1) Trademarks last indefinitely o Exception: Trademark dilution - when a trademarked feature becomes too commonly used to the point where it identifies the product rather than the source (i.e. Kleenex), the trademark dissolves • 2) Trademark protection only extends to similar products that would otherwise be confused as coming from the same source as the original manufacturer o Rationale: trademark protection exists to prevent confusion, but, for example, no one will think that Polo makes mechanical parts for a factory press o Exception: Famous marks - cannot be used even when no confusion is likely to occur Reasons for Trademark Protection • Promote competition • Allow companies to use identifying features that they can prevent competitors from capitalizing on in order to profit from confusion by consumers Benefits of Trademark Registration • Constructive notice to public • Legal presumption of registrant's ownership of mark • Ability to bring action concerning mark in federal court • Can file registration with Customs Service and prevent importation of infringing foreign goods • Can use U.S. registration as a basis for obtaining registration in foreign countries

purpose of copyright

• 1) promotion of public learning • 2) protection of public domain • 3) granting exclusive rights to the author o You don't own the work, you just own the copyright to the work

Requirements for a Trademark

• 1) typically a name, word, phrase, logo, symbol, design, image, or a combination of these which the owner uses to identify and distinguish his products from others of a different source o Exception: Functionality Doctrine - a useful product feature (i.e. a specific color on a medical pill in order to distinguish it as a blood medicine) o Exception: Scandalous marks - marks cannot be registered if they are scandalous, immoral, or deceptive • 2) must have acquired a "secondary meaning" in the minds of the public when the public realizes that the primary significance of the feature is to identify the source of the product rather than the product itself (i.e. the coke bottle shape identifying the bottle as made by coke rather than identifying the bottle as a soda bottle) o Must exist in the minds of the public o Must be associated with only the source o **Note: even generic or descriptive words can become trademarked if they acquire a secondary meaning (i.e. Bank of America)

finder

• A ---- of lost property has a right to the property against everyone but the original owner (Armory v. Delamirie) o Definition of -----r: one who has established 1) physical control over the property and 2) intention to assume dominion over the object

Perfect/Valid record title

• A valid chain of title coming from the sovereign. Can trace from the beginning to the person who is now selling the title • every seller should aim to convey perfect record title

Duty to Repair

• About whether T or L has duty to make repairs to property o This duty can be expanded or shrunk according to the terms of the contract, unless statute provides that L cannot waive certain obligations • Failure of duty to repair constitutes permissive waste o If remainderman covers for tenant's failure to pay, tenant is liable to remainderman for costs o Subrogation doctrine - allows the remainderman to put a lien or mortgage on the tenant's other property to cover for the costs

Lease:

• An agreement where the owner of property (usually in fee simple) grants a tenant the rights to possess a piece of property. Tenant has exclusive possession. o Any lease of more than a year must be in writing to satisfy Statute of Frauds o Sometimes there may be a conflict as to whether the agreement is a lease or something else (i.e. does "to T as long as he pays rent" constitute a tenancy at will or a fee simple determinable?) - in this case, courts will consider the intention of parties

Contingent Interests

• An interest is contingent if it only vests after the occurrence of a condition precedent • Example: "to A for life, then to B if B lives longer than A" o Remainder only vests once B fulfills the condition of living longer than A • Creating an interest in an unborn person (i.e. "remainder to A's first-born child") creates the condition precedent of being born • Words of survival also create conditions precedent (see below)

Assignments, and Sublets

• Assignment: T transfers the remainder of the entire term to someone else (assignee) o Minority rule: transferring the remainder of the entire term but retaining a right to re-entry of possibility of reverter makes it a sublease (American Community Stores) • Sublease: T transfers something less than the entire term (sublessee) o Case Law: American Community Stores v. Newman - transfer of all but last two days of lease constituted a sublease rather than an assignment, even though the agreement gave sublessee the right to "exercise the remaining option periods granted by the Prime Lease" o Minority rule: transferring entire term but retaining possibility of reverter or right to re-entry also classifies as a sublease (American Community Stores)  Counterargument: Possibilities of reverter or rights to re-entry are not considered estates in land, so this should be classified as an assignment

capture of gas

• Capture doctrine applies to gas as long as you do not trespass on someone else's land to get it o Case Law: Anderson v. Beech Aircraft Corporation: Non-native gas that is placed in a natural reservoir is bound by the capture doctrine. While the gas is in the reservoir, it is in its natural environment, and thus anyone who is not trespassing on that reservoir can extract it and own it. When this gas it put in the reservoir, and thus in its natural state (escaped), no one has title to it • Rationale: gas put in the ground is equivalent to a wild animal • Problems with applying capture doctrine to gas: o Encourages each landowner to grab as much of the resource as possible as early as possible (tragedies of the commons) o Or, if the gas company tries to buy all the available land on which the reservoir sits, it encourages the landowners to hold out for as high a price as possible o Leads to overinvestment in wells and drilling equipment and a speedy but careless extraction process o People may withdraw lots of gas even when we don't need to be mining that much • Possible solutions o "Fair Share" quotas  Owners may only withdraw up to a pre-calculated amount o "Reasonable Use" limits designed to prevent egregiously wasteful practices o "Unitization" or "Pooling" arrangements  Reservoir is managed as a single unit for the benefit of all the overlying owners

Duty to Operate According to Terms of Lease

• Commercial Leases: Implied Covenants of Continuous Operation? o Can sometimes be implied when the lease has no express provisions but stipulates that T must be L a % of his revenues and includes a very low base rent o Case Law  Piggly Wiggly - a lease from P landlord to D tenant supermarket that had substantial base rent and said that the premises "may be used for other lawful business purposes" did not imply a covenant of continued operation  Counterarguments: 1) Piggly Wiggly drafted lease; it should be construed strictly against drafter; 2) only reason they weren't using it was from preventing competitors from getting the lot

common interest communities

• Common interest communities have more leeway than developers to impose covenants forcing subdivision owners to purchase certain services though (i.e. cable TV, street maintenance, recreational facilities) o Common interest communities are managed by boards composed of the residents of the communities, so residents can take their complaints to the board o Common interest communities are also set up with a stronger commitment to preserving the property values in the community than a number of homes owned by a developer

Certain Restraints on Alienation

• Complete restraints on alienation are almost always not enforced by courts o i.e. grant of fee simple determinable "to A as long as he never transfers possession of the estate" o Rationale: courts want to allow the owner to make the most valuable use of the land and to keep property on the market • Certain partial restraints on alienation o Restraints against conveying land to anyone other than the grantor's family  By contrast, restraint against conveying affordable housing to any affluent buyer is upheld (good public policy - makes land available for the working class)

Joint Tenancy with Right of Survivorship

• Concurrent ownership but when one joint tenant dies, the interest in the property "remains" with the surviving joint tenants; last man standing inherits the whole interest o Conceptualized as an extinguishment of a burden from the interests of the other joint tenants rather than as the transfer of the deceased's interest to the survivors - this is why creditors can't get after the interests of a deceased joint tenant Requirements for Creating a Joint Tenancy with Right of Survivorship • Language: "To A and B in Joint Tenancy with right of survivorship" o Language important. There is a presumption toward tenancies in common • Four Unities (Traditional law) o Time - Both tenants' interests must vest at the same time o Title - Must be acquired by both in the same deed/will o Interest - Both have equal shares of the same estate o Possession - Both have right to possession of the whole property • New Rule (followed in some jurisdictions; alters four unities) o There can be a direct transfer from one person to himself and another to create joint tenancy as a will substitute (rather than using a straw man)  The four unities would not allow this because the original transferor's interest would have vested earlier (fails time) and would have been acquired in a different deed/will (fals title) o Proceeds can be dispersed according to unequal shares o Can agree that one has more rights of possession

Conditions Designed to Break Up Families or Inhibit Families From Forming

• Conditions that divest the grantee of the estate if they get married, allow certain family members on, or unless they get divorced are usually not enforced o By contrast, conditions designed to shift property ownership on remarriage or to allow other family members access to the property are upheld

Right to Re-Entry/Power of Termination

• Courts often interpret a failure to reserve a right to re-entry as the absence of a right of re-entry and will instead construe the language as creating a fee simple absolute or as a servitude (i.e. restrictive covenant, easement, etc.) or a trust • Conditions subsequent are strictly construed against the grantor by courts • Even if the condition occurs, adverse possession does not begin until the right to re-entry is exercised • Waiver of right to re-entry o Can generally be waived either expressly or through estoppel (when party with the defeasible fee simple detrimentally relies on right to re-entry not being exercised), so the fact that adverse possession has not officially begun may be irrelevant • Most states limit how long the condition can last; some conditions terminate after 30-40 years; CA requires re-recording every 30 years

Unreasonable Restrictions on Household Occupants

• Covenant may unduly restrict household occupants and personal freedoms of the people in the household • Case Law o Nahrstedt (p. 1032) - CA Supreme Court holding that a common interest community's restriction against maintaining pets in the community's recorded declaration was enforceable because it was reasonable because it protected the general expectations of all condominium owners, kept costs down, and provided the other owners with other reasonable benefits o Other restrictions might unfairly discriminate against unmarried couples and violate the Fair Housing Act o Will be unenforceable if it denies a fundamental constitutional right

Unreasonable Design Controls

• Covenant might impose design controls that allow the covenantee to deny the covenantor of certain uses of their property for arbitrary or unreasonable reasons • Case Law o Rhue v. Cheyenne Homes (p. 1028) - holding that architectural committee could permissibly enforce a covenant that gave it power to deny a subdivision owner's plan to move a thirty-year old Spanish-style house into a community made up of modern ranch-style homes because it would harm the property values of the other houses and because the decision was not arbitrary o Prestwick Landowners (p. 1029) - holding that the design covenant was invalid because it did not provide specific guidelines under which an owner could determine what was acceptable o Davis v. Huey (p. 1029) - holding that developer's enforcement of a covenant by denial of a plan to set a house farther back in the lot than neighboring houses was arbitrary and unreasonable o Sometimes, installation of certain satellite dishes and antennas may be inhibited by a covenant, but federal legislation inhibits the enforcement of certain types of covenants against satellites and antennas o A Washington state court enforced a covenant in which a homeowners association held a family liable for painting the house purple without the association's approval

Conversion

• Def: wrongful dominion of one person over another's chattel/property; plaintiff must establish ownership, possession or right to possession. • Case Law: Popov v. Hayashi o P caught a baseball but was attacked by others in the crowd, loses it and D takes possession of it o Ct says P had PRE-POSSESSORY RIGHT ball—an ENCUMBRANCE on property, a qualified right to possession which can support conversion claim o although D did prove he had possession of ball, can't claim ownership b/c ball was encumbered w/ P's pre-possessory right o court uses EQUITABLE DIVISION: both had equal titles to the ball, so just divide the property rather than determining all or nothing • Other Examples of Equitable Division in Conversion Cases o Confusion Doctrine (Prunes Case)  If you have something that is fungible and it is grouped with something else that belongs to someone else and part of these items get damaged, but you can't tell whose items got damaged, your interest in the damaged goods is equal to your proportion of the overall share

Executory Interests

• Definition: A future interest that divests the interest of another but, unlike a remainder, does not follow a life estate or term of years o Most commonly follow a fee o Almost always contingent (except for certain kinds of springing executory interests) • Shifting Executory Interests o Divest the grantee o Example: O "to A, but if B reaches 21, then to B" - A has a fee simple subject to an executory interest and B has the shifting executory interest • Springing Executory Interests o Divest the grantor o Can be vested when they follow a gap  i.e. O "to A for life, then to B five days after A's death"  B's interest is vested - there are no conditions precedent  B's interest is not a remainder b/c O has a reversion in fee simple that divests 5 days after A's death  Thus, B has a springing executory interest and O, after the reversion occurs, will have a fee simple on condition subsequent • **The interests of unborn members of a class are considered executory interests (because they will partially divest the fee simple interest of the existing members of the class) o Example: "To A for life, remainder to B's children" - B has two children; the interests of B's unborn children are executory interests which will partially divest the remainder interest of B's two existing children

Remainders

• Definition: a remainder is a future interest that follows the natural termination of a life estate or term of years • must be expressly created in the instrument creating the preceding possessory estate Specific Remainder Rules (**only followed in a few states**) • Rule of Destructibility of Contingent Remainders o Old rule that a contingent remainder that had not vested upon the termination of the preceding freehold estate was destroyed  Example: O gives "to A for life, then to B if she reaches 21" - if B has not reached 21 when A dies, the contingent remainder is destroyed  Today, if B was not 21, title would revert to O, and B would have a springing executory interest that divested O's reversion when B reached 21 o Goes along with merger doctrine (general rule is that when a person acquires all the interests in land, present and future, a merger occurs  Old rule was that if a person acquired all interests in land, present and future, except for contingent remainder (unless created in the same deed), the contingent remainder would be destroyed anyway  Example: O gives "to A for life, remainder to B if B reaches 21;" then, in a later deed, O buys A's life estate - this would destroy B's contingent remainder even if B reached 21 before A died • Rule in Shelley's Case o Old rule that a remainder created in the grantee's heirs was converted into a remainder in the grantee  Example: "O to A for life, remainder to A's heirs" - remainder converts to a remainder in A, which merges with the life estate to create a remainder in A in fee simple  **note: does not apply to executory interests, only to remainders • Doctrine of Worthier Title o Old rule (treated only as a rule of construction now, which is rebuttable with clear intent by grantor) that a remainder created in the grantor's heirs was converted into a reversion in the grantor  Example: O "to A for life, remainder to O's heirs" - remainder in O's heirs is invalidated, which converts O's reversion subject to complete divestment into an indefeasible reversion in O

Relocation of Easements

• Depends on Jurisdiction o RESTATEMENT: Servient owner can unilaterally relocate the easement so long as he pays and the easement reasonably retains its intended purpose  Rationale  dominant estate holder would price gouge servient estate holder before giving him permission to relocate due to the bilateral monopoly he has because he knows the servient owner might stand to profit heavily from relocating the easement; this is more economically efficient  also, easements are made to serve a particular purpose for the dominant estate owner, they are not made to give him a veto over any type of use the servient estate owner wants to conduct on his land o Case Law: MPM Builders v. Dwyer - servient estate owner, who wants to further develop its property according to a scheme that is impossible with easements in current location, can relocate easements designed to provide neighboring dominant estate owner with a right of way to a street because he will bear the cost and the new roads will still lead to the same street • Common Law: only permissible by agreement of both parties o Rationale: allowing servient owner to unilaterally relocate would subordinate property rights to economic efficiency and would invite too much litigation over whether the relocation was reasonable or not o Case Law: AKG Real Estate v. Kosterman - servient estate owner is not allowed to relocate dominant estate owner's easement, which is intended to provide him a right of way to a public road, because the easement interferes with servient estate owner's development plan; easement still serves its purpose, which is giving access to the road "Changed Conditions" doctrine does not apply b/c 1) easement still serves its purpose; 2) changed conditions doctrine is meant to apply to conditions beyond both parties' control (i.e. natural disaster), not conditions resulting from voluntary alterations to property made by servient estate owner

Duty to Fulfill Mutually Dependent Covenants

• Duty: Landlord must uphold any promises that were significant inducements to the tenant's entering the lease in exchange for tenant paying rent • Remedy: If the landlord does not uphold such promises, tenant can terminate the lease o Case Law: Wesson - L's failure to fix leaking roof does not constitute constructive eviction, but because having "dry space" was a significant inducement to T's signing the lease so he could use the building for his printing business, L's failure to fix roof means that T can terminate

Complications With Notice

• Easements or covenants recorded in the deeds of subdivided property o Dilemma: A may convey one of many subdivisions of his land to B B may be granted an easement or covenant on the rest of the subdivisions; however, if C later buys one of the other subdivisions and checks record title, he would not find this easement - his record would go straight back to the creation of the subdivision and bypass the transaction that A had later made with B  Argument for holding that there is no notice: A is not obligated to check the deeds of surrounding properties  Counterargument: Or A should have known that many covenants are just recorded in one deed from a common grantor • Wild deeds o Could give it to the party who would better preserve the integrity of the recording system • Wild Easements o When easement came before title and was not recorded considered a "Wild Easement" and therefore not enforceable against subsequent purchaser. Ryckzowski v. Chelsea • Illegally recorded past deeds o Sometimes, give it to the party whose chain of title appears complete (shelter rule) o Sometimes, give it to the party who received the property through the first legally recorded deed

Disallowed Self-Help Remedies

• Evicting a tenant by force is prohibited in CA - judicial proceedings are the only way to go o i.e. cutting off utilities, changing locks to prevent T from getting in • Forcible Entry/Unlawful Detainer o Forcible entry = using force to unlawfully enter a premises o Unlawful detainer = detaining someone's property unlawfully o These remedies are prohibited even if the tenant has breached the lease or if the landlord maintains a lien on the tenant's property o Case Law: Jordan v. Talbot - holding that L could not enter T's apartment and move her property to a warehouse and not let her re-enter her apartment even though T was two months in arrears on rent and L had a lien on her property and a right to re-entry in the event T was in arrears  Rationale: Goal is the preservation of civility and order • Using security deposit to pay off future rent that T has not paid off after terminating lease (default rule) (250 LLC v. Photopoint) o However, such a provision can be included in the security deposit o L also always has the option of continuing the lease, not terminating, and then holding T liable for the leftover rent

Fair Use Defense (codified in § 17 U.S.C. 107)

• Four factors o 1) purpose and character of the work  Commercial work (as opposed to non-profit educational) weighs against fair use; if the work is transformative, that weighs in favor of fair use o 2) nature of the copyrighted work  Highly creative original work militates against fair use, but this is mostly irrelevant for purposes of parody o 3) amount and substantiality used in relation to copyrighted work as a whole  Parodies can take as much as is necessary to conjure up the original, and anything taken beyond that must serve parodic purposes o 4) whether the new work would usurp the market for the original or derivative works  **Note: the creation of a derivative work only protects what is original in the derivative work; it does not extend the copyright of the original

Use of Easements to Serve Non-Dominant Estates

• General rule is that this is not permissible o Case Law: Brown v. Voss - court holds that P cannot use easement over D's property, which is intended to serve one lot he owns, to also serve a second lot when he wants to build a home straddling the two lots  However, court assigns damages at $1 because there is no discernible damage to the servient estate from this sue

Merger of Sales Contract Into the Deed

• If closing does occur then the sales contract merges with the deed • Contract disappears unless parties provide otherwise o Exception: collateral promises in the sales contract are not merged and the seller is still bound to them  Examples of collateral promises: builder's warranty to construct a house in a good manner; a provision giving seller option to repurchase the property  Not collateral promises (merged): promise by seller to place the mortgage it got from the buyer subordinate to other mortgages

Buyer Remedies for Non-Marketable Title

• If not marketable, buyer must alert seller and give reasonable time to cure defects. o Notice must specify nature of defects. • Buyer remedies before closing: o Rescission: unilateral unmaking of a contract o Damages: get money from the courts o Specific performance: make seller turn over land with abatement (reduction) of purchase price

Insurance proceeds

• If the tenant has no duty to insure but insures his interest, he is the only one who can collect the proceeds of the insurance. • If he insures the entire fee simple: o Some courts hold that he may keep the entirety of the recovery (because it's the fault of the insurance company to allow him to insure interests beyond his own) o Some courts hold that it'd be a windfall so the proceeds beyond recovery for the tenant's interests are held in trust for the remainder man

Trespass to Chattel

• Invasion of personal property that (1) deprives owner of use (2) damages chattel (3) OR impacts functionality o Allow reasonable invasions based on reasonable expectation of privacy/ exclusivity—Email network is open to public o Prohibitions should not burden business (i.e. prohibiting unwanted emails)

How much can the non-depositor withdraw when not paying depositor's bills or after death of depositor?

• Jurisdictions following Uniform Probate Code - withdrawal rights are based on each party's net contributions • Other jurisdictions - up to half

How Long Does A Copyright Last?

• Lifetime of the author plus 70 years • If you don't know who the author is, then the copyright lasts 95 years from the date of first publication or 120 years from its first creation, whichever expires first

Improvements on the Property

• No co-tenant has the duty to pay for improvements o **Note: repairs are NOT an improvement • No co-tenant can collect for improvements o Exception: they can only collect if the improvements increase the amount that the property sells for; then, they can collect after the sale and according to the amount by which the improvement increased the property's value

Equitable Conversion Doctrine

• Purposes o Sometimes helps decide who bears the risks of loss o Sometimes helps decide what to do if one or both of the parties dies right after sale is completed but before delivery or conveyance of the deed • When you have an enforceable right to an interest in that property, you have an equitable interest in being treated as the owner of the property o What seller now has is the right to payment, as his interest is treated as personal property o Buyer has the right to the conveyance, as his interest is treated as real property

Diffuse Surface Water

• Refers to drainage water from rain, snow, etc. that runs over the surface but does not amount to a stream o Plurality rule: "reasonable use" doctrine  A person is allowed to alter drainage of surface water to the point that it causes "unreasonable interference" with his neighbors' use of the land  Is in between the other two doctrines and is becoming favored by a plurality or majority of states  Factors for determining reasonability  necessity of draining water  whether person acted with care  damage caused to neighbor  feasibility of better drainage methods o "common enemy" doctrine  Surface water is considered a "common enemy" and, to encourage the clearing of water to develop land, a person is allowed to take any means to clear the water and is not liable to his neighbors for flooding them  A frequent modification is that a person may not clear the water in a manner that exceeds or alters the natural flow of the water o "civil law" doctrine  Inverse of common enemy; a person is strictly liable to others for any damage from surface water that he has cleared off his land  Downside: This inhibits development of any land, so the doctrine is often modified by blending it with the "common enemy" doctrine in many jurisdictions that use it

Indefeasibility, Total Divestment, and Partial Divestment

• Requirements for an indefeasible interest o Not subject to being defeated or divested o Not subject to being diminished in size o Example: "To A for life, remainder to B" - B has an indefeasibly vested remainder • Requirements for an interest subject to total divestment o Interest is defeated/transferred upon the occurrence of a condition subsequent to the vesting of the interest o Example: "to A for life, remainder to B, but if at B's death he has no issue, to C"  B's remainder in fee simple is subject to total divestment if at death he has no issue • Requirements for an interest subject to partial divestment o Typically occurs when the interest is a class gift where the size of the class can change even after the interest vests o Example: "to A for life, remainder to B's children" - at time of deed, B has two children - if B have more children, the interest of B's first two children is partially divested as the interest is re-divided among more recipients in the class

Intangible Property Rights

• Restatement Rule: in order to bring an action for conversion against another in regards to intangible property, the intangible right must be merged into a document representing the right or obligation of the holder o i.e. a stock certificate • CA rule: "merged in a document" test is not necessary o Case Law: Kremen v. Cohen - D was liable for stealing P's right to the domain name for the website "sex.com" even though this right was intangible

Rights to Streams and Lakes

• Riparian Proprietor - one who owns land with a boundary on a natural pond, stream or lake • Reasonable Use Doctrine - arose when the "natural flow" doctrine proved to be unworkable after the industrial revolution o You can make any and all reasonable uses of the water as long as it does not interfere with the rights of other adjacent property owners to use the water o Used by majority of the states • Natural Flow Doctrine - right to have the water in its natural state o Lower owners (those further downstream) should have access to as much water and as good quality water as those upstream o Downside: this deters anyone upstream from touching the water o Some limited use is ok but water is not allowed to be transported off the property • Pure Appropriation System ("Colorado Doctrine) - right to use the water is decided through water permits, state agency regulations, etc. o Used by minority of states, especially states inland which are arid and need to use water for lots of irrigation or agricultural purposes o Someone who uses water for a beneficial use may "appropriate" the right to continue doing so until a competing complainant demonstrates a similar beneficial use o Benefit: Prevents tragedies of the commons • Mixed Reasonable Use/Appropriation System (California Doctrine) o Reasonable use until there is a shortage - then it moves to an appropriations system Limits on private riparian rights to streams and lakes • "Navigation Servitude" o Legal principle stemming from Commerce Clause of Constitution that gives the federal government the right to regulate navigable waterways and build structures in navigable water (i.e. dams) o Can infringe on private property rights to water • Public's right to boat in navigable waters • Public's right to use navigable waters for recreational purposes (sometimes) • Private riparian rights of others

When Can a Sales Contract Be Rescinded?

• Sales Contract can be rescinded for fraud, misrepresentation or material mistake

Future Interests

• See Possibility of Reverter • Need not be explicitly reserved in a grant of fee simple determinable - it is assumed to exist even if not mentioned • Adverse Possession by the holder of the fee simple determinable begins as soon as the condition occurs • Most states limit how long the condition can last; some conditions terminate after 30-40 years; CA requires re-recording every 30 years Reversion • Definition: a reversion is a vested future interest retained by the grantor that vests upon the expiration of the grantee's lesser estate

Alternatives to the RAP

• The Wait and See Doctrine - Wait and see if any of the interests vest, or become certain to vest (or fail) within 21 years after the death of a life in being, if they don't, the interest is void • Cy Pres Doctrine o If the interests would be void under the old Rule, the courts rewrite the instrument so it will vest, sticking as close as possible to the grantor's intent • Savings clause o Provides that an interest will automatically vest within the perpetuities period • Uniform Statutory Rule Against Perpetuities (used in California) o Wait and see for 90 years (will it vest?); A non-vested property interest is invalid unless one of the following conditions is satisfied: o When the interest is created, it is certain to vest or terminate no later than 21 years after the death of an individual then alive o the interest either vests or terminates within 90 years after the deed  Incorporates Cy Pres doctrine  Includes an irrebuttable presumption that a widow is a life in being and widows are presumed to be the person married at the time of the conveyance

What Cannot Be Copyrighted?

• The utilitarian feature of something classified as a "useful article" o However, if the article is classified as a "toy" instead, it may be easier to copyright o Whether the utilitarian feature can be separated from the unique, creative feature is called the "conceptual separability test" o Case Law: Oddzon - KOOSH ball cannot be copyrighted because its unique aspect (its tactility) is inseparable from its utility (makes it easy to catch) o Rationale: don't want companies monopolizing useful things o Exception  Even if certain works are not copyrightable (i.e. news), courts may quasi-property interests over certain things in order to protect the fruits of one party's labor  Case Law: Associated Press v. International News Service - court holds INS liable for taking the AP's news articles, copying them, and then selling them before AP could break the story

Obligations of Assignees to Landlord

• There are two sources of obligations for the assignee o 1) privity of estate - applies only for the duration of the time you hold the land; the covenants assumed are only covenants that "touch and concern" the land  General rule: Covenants to pay rent touch and concern the land  Privity of estate ends when the assignment terminates  Minority rule is that unilateral abandonment by the assignee (even w/o L accepting abandonment) terminates the assignment and ends privity of estate (Kelly v. TriCities) o 2) privity of contract - provisions of original lease apply to assignees only when they expressly assume the obligations of the lease in the instrument of transfer from lessee; there is no implicit assumption of the lease (Kelly v. TriCities)  A provision in the original lease that the assignee shall assume the terms imposes a duty on the lessee to include this in the assignment, but does not automatically mean the assignee assumes the obligations (Kelly v. TriCities)  However, assignee is deemed to have inquiry notice of any covenants in the lease whether or not he agrees to fulfill the lease covenants

Policy for RAP

• To ensure that parties are secure in knowing that they can invest in their property and reap the benefits of their investments • Courts don't like a contingent interest to last seemingly in perpetuity

Obligations of Sublessees to Landlord

• Very few obligations b/w sublessees and landlord • Sublessees lack strict vertical privity w/ L - the sublease is a separate landlord-tenant relationship with the main lessee • Usually, when sublessee commits waste or engages in nuisance on the premises, landlord must hold lessee liable, who in turn must hold sublessee liable • Exception o Negative covenants that run with the land (i.e. obligation to refrain from converting residential home into commercial business) are enforceable against sublessees as equitable servitudes Landlord's treatment of assignments and sublets • Leases sometimes forbid assigning and/or subletting or forbid doing so w/o consent of L

mislaid property

• When property is --- (intentionally placed somewhere by the owner, and then forgotten about), the owner of the locus in quo (place where the property was kept) has a right to the property against all but the original owner

Risk of Loss

• Who bears risk of loss if property is damaged or destroyed before the time for closing? • Parties can specify this in the contract • Three different default rules o Majority rule: Buyer bears risk  Rationale: buyer gets benefits of appreciation (i.e. if oil is discovered on land between signing of contract and closing) o Seller bears risk until delivery of possession or title to buyer, whichever comes first (minority rule)  Rationale: The seller is technically the owner until the deed is delivered to buyer o 3rd option: Buyer bears risk, but seller bears risk of damage by natural disasters • How does insurance impact this? Who gets the proceeds if only the seller has insurance? Parities can also specify this in the contract o Courts split on default rules; some hold the seller gets the proceeds, others (most American courts) hold that the buyer gets the proceeds so that seller doesn't get a windfall

Conditions of Survival

• Words that imply survival in regards to an interest create a condition precedent of survival before the interest can vest in the surviving party • Examples o "to A for life, remainder to his surviving children" o "to A for life, remainder to his children then living" o Words that imply conditions of survival when giving gifts  "issue"  "heirs"  "descendants"

Covenants for Title

• grantee may protect ownership by obtaining title covenants- a warranty that the grantee's title is good from the grantor. If there is no covenant of title, then seller is not liable if title fails. Classified as present covenants or future covenants. • Present covenants: one which guarantees that a described situation exists at the time the covenant is made. Covenant is either broken when it is made or never broken. o i. Covenant for seisin- means that grantor guarantees he owns the land he is purporting to convey. o ii. Covenant of the right to convey- guarantees right to convey land. Same as above except, grantor may have the right to convey and not be the owner. o iii. Covenant against encumbrances- grantor guarantees land has to mortgages, tax liens, judgment liens, easements, restrictive covenants against the land. • b. Future covenants- covenants are not broken until the day of the conveyance. o i. Covenant of quiet enjoyment and covenant of general warranty- Purchaser will not be disturbed in the future by the grantor or by some paramount claim existing at the date of the conveyance. Occurs only when the coventee is evicted or disturbed in possession. Not enough that there is a mere existence of a superior title. o ii. Covenant for further assurances- guarantees grantor will do such further actions as are within grantors power to make the purchasers title good

Covenants That Contribute to Blight and Poverty

•Covenant might not be enforced by a court when enforcing it would contribute to blight, poverty, and endanger the health of nearby residents o Case Law: Davidson Bros. v. Katz & Sons (p. 1020) o P was a supermarket company and D had covenanted with P not to use D's land for a supermarket for 40 years after the 1980 date of sale o Closing of supermarket created a hardship for downtown city residents, most of whom did not have cars o City housing authority acquired D's land and leased the property to another D on the condition that the land be operated as a supermarket o P sued to enjoin use of the property as a supermarket o Holding: court refused to enforce covenant b/c doing so would contribute to personal hardship of the residents and inhibit ability of the city to revitalize the downtown; there was no suitable alternative location for a supermarket o Possible Counterarguments:  You could require payment of damages instead of enforcing the injunction to allow the beneficial but prohibited use to occur If city is acquiring the land and then seeking to have the covenant terminated, it could constitute inverse condemnation by taking private land for public use w/o just compensation

adverse demand rule

 Demand and refusal rule  Statute only begins to run when the person figures out who owns the property, demands that the adverse possessor return it, and the adverse possessor refuses  Rationale: Gives true owner time to not only find the adverse possessor but also confirm whether they own the property; prevents the jurisdiction from becoming a haven for stolen ancient property (Guggenheim)  Counterargument: Makes it unlikely that someone can ever truly establish adverse possession, because even a lazy owner can eventually demand the property back, and by then he will be ready to file suit to reclaim it  Case Law: Guggenheim - Guggenheim museum is allowed to sue in replevin to retake stolen artwork from someone who purchased it 20 years before because they only recently demanded and refused Stupid exception: NY's "thief rule"  When a thief steals a painting, the statute begins to run immediately  Rationale: no good rationale, this rule is dumb. However, a thief couldn't sell the work to a good-faith purchaser b/c the statute would not begin to run against the good-faith purchaser until demand/refusal  However, fraudulent concealment doctrine may still hold thief liable at times

animus revertendi

 Principle that if a captured animal has been domesticated and has habit of return (animus revertedi), it is not available for capture by another  However, if the animal is wild and has no animus revertendi, once it escapes it is up for grabs  Ex: someone can't steal your dog when it runs away, but they could probably take a duck that you lured into your pond

equitable tolling

 If adverse possessor has taken steps to conceal the fact that the property they own belongs to the true owner, and the true owner has no way of discovering this fact and is not in a position to sue, the statute may be tolled for purposes of equity  Case Law: U.S. v. Rosner - after U.S. govt. took property that belonged to Jewish holocaust victims from the "gold train" and falsely claimed that the property could not be identified, court allowed Jewish true owners to sue for possession of the property over 50 years after the taking 

adverse discovery rule

 Statute only begins to run when the true owner (who must be using due diligence to find the property) discovers the possessor and whereabouts of the property  Rationale: 1) balances interests because it allows the owner to locate his stolen property, even if it takes many years, but also punishes the "lazy owner" by forcing him to use due diligence to try to find the property (i.e. if the owner does not call Interpol or contact museums)  Counterargument: For specific property (i.e. stolen ancient artifacts from foreign governments in the Guggenheim case), even locating the true owner may not be enough, because the govt. must figure out if the property was theirs - demand and refusal is more equitable; this would make jurisdictions with the rule a haven for stolen property  Case Law: Greek Orthodox Church case - Greek Orthodox church in Cypress is allowed to bring suit against a purchaser of stolen mosaics almost 10 years after goods are stolen because they had only recently discovered the purchaser of the stolen artowrk