Unit 3: Interests in Real Estate

A parcel of land that has no direct access to a street or public way, except over land of its previous owner, will benefit from

an easement by necessity. An easement by necessity is created when an owner sells a parcel of land that has no legal access to a street or public way, except over the seller's remaining land.

The type of easement that is a right-of-way for a utility company's power lines is

an easement in gross. Easements in gross are individual rights to use someone's land, as in the case of the utility company. A commercial (but not a personal) easement in gross can be assigned, conveyed, and inherited.

A property owner who has the legal right to use a neighbor's land holds

an easement. An easement is a right of use or passage, not of ownership—nor is it is an example of encroachment or the exercise of a government's police power.

A family owns a house across the street from a lake but has the right to use the lakefront homeowner's driveway to access the lake because of the existence of

an easement. An easement is the right to use the land of another for a particular purpose.

Which of the following is NOT a governmental power?

condemnation. Governmental powers are police, escheat, eminent domain, and taxation. Condemnation is the process by which the government exercises the right of eminent domain, by either judicial or administrative proceedings.

The state's authority to enact legislation to protect the public is passed through to municipalities and counties by

enabling acts. The state passes police power to local counties and municipalities by enabling acts. Licensing laws are an example of police power.

Which of these is defined as any claim, charge, or liability that attaches to real estate?

encumbrance. An encumbrance is any claim, charge, or liability that attaches to real estate. Liens, easements, and deed restrictions are all types of encumbrances.

an easement. An easement is a right of use or passage, not of ownership—nor is it is an example of encroachment or the exercise of a government's police power.

escheat. A governing body is able to enact laws to protect the public's welfare through its police power, take property for a public use by its right of eminent domain, enact taxes to provide for maintenance of public services, and take over ownership of property when an owner dies and no heir can be found.

When an individual dies, leaves no will, and has no statutory heirs, any real property will transfer to the state through a process called

escheat. Escheat (revert) is the process whereby the state may acquire privately owned property when an owner dies and has no heirs or a will or living trust indicating how the real estate is to be distributed.

A property owner dies without a will or lawful heirs. By what process does the property revert back to the government?

escheat. State laws provide for ownership to transfer, or escheat, to the state when an owner dies and leaves no heirs (as defined by state law) and there is no will or living trust instrument that directs how the real estate is to be distributed.

An encroachment describes improvements that

extend over adjoining lot lines. An example of an encroachment is a shed that extends two feet onto the neighbor's property.

One who has ownership rights of real estate that could continue forever and which provide that no other person can claim to be the owner of or have any ownership control over the property has

fee simple absolute. Fee simple is an absolute ownership—an inheritable interest "with no strings attached." A life estate is noninheritable; fee on condition subsequent and determinable fees are both estates involving another person with an interest called "possibility of (either reverter or) re-entry."

Which of the following has an indeterminable duration?

freehold estate. Freehold estates, which last an indeterminable length of time, include fee simple, defeasible fee, and life estates.

A patient died in a nursing home. The deceased left no will and had no heirs. What happens to the deceased's $250,000 estate?

it escheats to the state or county. Because the patient died without a will and there are no heirs, the $250,000 becomes the property of the state or county.

A homestead exemption protects the property owner entitled to the exemption from

judgments for debts, but not those used to purchase or improve the homestead property. With homestead protection, a portion of the land or value of the property occupied as the family home is exempt from certain judgments for debts, such as charge accounts and personal loans but not a mortgage for the purchase or improvement of the property. A family can have only one homestead at a time.

A homestead is a legal life estate in real estate that is

occupied as the family home. In many states, a portion of the area or value of this land is protected or exempt from judgments for debts other than those secured by the property.

Escheat is intended to prevent property being

ownerless or abandoned. Escheat is intended to prevent property from being ownerless or abandoned after a property owner dies, leaving no heirs specified by will or state law.

The government's authority to appoint local citizens to serve on boards to govern compliance with zoning standards and building codes for their communities is an example of

police power. Police power is the right of every state to enact and enforce legislation to preserve order, protect the public health and safety, and promote the general welfare of its citizens.

State environmental protection laws are examples of

police power. The power to enact legislation to preserve order, protect the public health and safety, and promote the general welfare of citizens is police power.

Regulations that govern the use, occupancy, size, location, and construction of real property also fall within the government's police

power. Regulations that govern the use, occupancy, size, location, and construction of real estate also fall within the government's police power.

The state requires enough land to build a four-lane highway. For the state to acquire the needed land from a property owner, the state must do all of these EXCEPT

reimburse the property owner for the amount that the property owner paid for the land. To acquire private property through eminent domain, the state must prove that the purchase is for the public good, pay a fair price, and allow the property owner full rights to appeal. The price may or may not reflect what the owner paid for the property.

If the dominant estate merges with the servient estate, which of these is TRUE?

the easement is terminated. If the owner of the dominant tenement also becomes owner of the servient tenement (or vice versa), the easement terminates. Because the same person owns both properties, there is no need for the easement to exist.

A life estate that is not created by a property owner is

the legal life estate established by state law. A legal life estate, such as dower, curtesy, and homestead, becomes effective automatically when certain events occur.

Notice of a pending legal action that can be filed in the public record is

the lis pendens. The lis pendens is a notice filed in the public record of a pending legal action affecting the title to or possession of property.

The holder of a right of reentry of real estate (or the holder's heir or successor) can assert the right

by bringing a legal action in court. With a fee simple subject to a condition subsequent, the estate does not automatically terminate upon violation of the condition of ownership. The owner (or the owner's heir or successor) has the right of reentry but must bring a legal action in court to assert the right.

A large undeveloped parcel of land on the side of a hill borders a road on its lower edge. The owner of the parcel sells the lower portion of the property to a buyer who builds a home on it. Several years later, the upper portion of the property is sold to someone else. The upper portion of the property does not border any road. To gain access to the road, the owner of that property has a legally implied right to an easement

by necessity. An easement by necessity could be created by court order to permit legal access to the second property.

The owner of fee simple title to a vacant lot adjacent to a hospital decided to make a gift of the lot to the hospital. The deed conveyed ownership of the lot to the hospital "so long as it is used for hospital purposes." After completion of the gift, the hospital will own

a fee simple determinable. A determinable fee estate has a special limitation and may end automatically if there is noncompliance with that stipulation. Language such as so long as or while characterize this estate. The hospital's ownership of the lot would come to an end if the property were to be no longer used for hospital purposes, and the lot would immediately become the property of the former owner or that owner's heirs.

A person who has complete control of a parcel of real estate is said to own

a fee simple estate. The highest interest in real estate recognized by law is the fee simple or fee simple absolute estate, providing the holder all rights to the property.

A property owner has given a neighbor permission to park a camper in the owner's yard for a few weeks free of charge. The neighbor has

a license. Personal, revocable, and unassignable permission to use another's land is a license.

Because a homeowner failed to pay the real estate taxes on time, the taxing authority imposed a claim against the homeowner's property. This claim is known as

a lien. Unpaid real estate taxes are a lien on the property because they are a charge against the property that provides security for a debt or an obligation of the property owner.

A deed restriction is considered

a private restriction, and it is conveyed in the deed to the current property owner. A deed restriction will run with the land (convey to a subsequent property owner) and cannot violate any law, such as a fair housing law.

An owner conveys ownership of a residence to a church but reserves a life estate in the residence. The future interest held by the church is

a remainder. Until the owner dies, the church will have a remainder interest. The owner reserved a life estate. The church may legally sell its future (remainder) interest, even during the lifetime of the life tenant.

Upon the death of the life tenant, the property returned to the grantor. The type of interest held by the grantor in the life estate must have been

a reversionary interest. If the estate returns to the grantor, it is known as a reversionary interest. If the estate goes to another party, that party has a remainder interest.

For as long as anyone can remember, neighbor families have used a footpath to get to the river. Recently, the current owner of the footpath erected a fence across the path. Which of these easements might the neighbors claim would require the owner of the footpath to remove the fence?

easement by prescription. Long-time unauthorized usage may create legal rights leading to an easement by prescription. An easement in gross is a personal right, often used by utility companies. An easement by necessity could be imposed by court order to provide access to a landlocked property.

Condemnation is the process by which the government exercises the right of

eminent domain. Condemnation is the process by which the government exercises the right of eminent domain to take possession of property that will be put to a public use, on payment of just compensation to the owner of the property.

The right by which the government takes private lands for public use is

eminent domain. The process is condemnation; the power is eminent domain.