Real Property MCQs

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Twenty years ago, a nephew received a deed to a farm as a gift from his aunt. The aunt's deed was properly executed and delivered, and the nephew recorded. The nephew had no interest in farming, so he left the property alone for 10 years. At that point, he transferred all his rights in the farm by quitclaim deed to a neighbor who owned the adjacent land. The neighbor had a full-time job and did not farm the land but lived in the farmhouse for five years. He then took a job in a distant city for five years. When he returned, he learned that the aunt who made the initial transfer to her nephew had not in fact been the fee simple owner of the farm. The true owner of the property had just died and her daughter and sole heir demanded possession from the neighbor. The statutory period for adverse possession in the jurisdiction is seven years. In a quiet title action, how should the court rule?

The daughter is the fee simple owner of the farm.

Twenty-five years ago, a man purchased a vacant tract of land from a woman. Unbeknownst to the man, the woman did not own the land. Someone else owned the land in fee simple. Shortly after the purchase, the man built a house on the northwest quarter of the tract, leaving the rest of the tract vacant. Recently, the actual owner of the tract died, still without knowledge that the man had built a house on the northwest corner of the tract. The actual owner's will left all of his property to his son. The relevant statutory period for adverse possession is 20 years. If the man brings suit to quiet title to the tract he had purchased 25 years ago, how should the court decide? A The man is the owner of the entire tract. B The son is the owner of the entire tract, because as to him, adverse possession began when the actual owner died. C The son is the owner of the entire tract, because the man only occupied a portion of the tract. DThe son is the owner of the entire tract, if the man did not pay the property taxes on the entire tract.

(A) The man would be declared the owner of the tract on the basis of constructive adverse possession. To establish title by adverse possession, the possessor must show (i) an actual entry giving exclusive possession that is (ii) open and notorious, (iii) adverse (hostile), and (iv) continuous throughout the statutory period. Here, the man actually possessed at least a quarter of the property because he built a house on it. The man used the house alone, so his possession was exclusive. A house is plainly visible, so the possession was open and notorious. The man built the house without the true owner's permission, so the possession was hostile. And the possession was continuous for 25 years, longer than the statutory period. Actual possession of a portion of a unitary tract of land is sufficient adverse possession as to give title to the whole of the tract of land after the statutory period, as long as there is a reasonable proportion between the portion actually possessed and the whole of the unitary tract, and the possessor has color of title to the whole tract. Color of title is a document that purports to give title, but for reasons not apparent from its face does not. Usually, the proportion will be held reasonable if possession of the portion was sufficient to put the owner or community on notice of the fact of possession. Here, the man had color of title to the entire tract because he purportedly purchased it from the woman. His house took up a significant portion of the property, such that the owner or community would have been on notice of the man's possession of the tract. Thus, (C) is incorrect. (B) is incorrect because a transfer in ownership does not interrupt the statutory period for adverse possession. (D) is incorrect because only a minority of states require the adverse possessor to pay taxes on the property.

A farmer conveyed a 60-acre parcel of land to a rancher. A private gravel road ran through the center of the parcel. The southern half consisted of arable land, which the farmer, and later the rancher, used for farming. The northern half was undeveloped woodland. The rancher never used the northern half for timbering or for anything else. On very rare occasions, the rancher would take a walk in the woods, but outside of those occasions she never set foot on the northern half.Fifteen years after the farmer conveyed the parcel to the rancher, a landowner appeared, claiming ownership of the northern half of the parcel. Unbeknownst to either the farmer or the rancher, the landowner's name had been forged on the deed purporting to convey the parcel to the farmer, and the landowner was, in fact, the true owner of the property at that time. The state in which the parcel is located has a 10-year statutory adverse possession period. The landowner admits that the rancher now has title to the southern half of the parcel by adverse possession.In an action to quiet title, who will prevail as to the northern half of the parcel? A The landowner, because the rancher did not actually occupy the northern half. B The landowner, because one may not obtain color of title through a forged deed. C The rancher, because her farming of the southern half was constructive occupation of the entire parcel, including the northern half. D The rancher, because the farmer did not know his deed to the parcel was forged, and he acted in good faith when he conveyed to the rancher.

A man and a woman who owned two adjacent properties executed and recorded reciprocal easements to five-foot strips of land on the border of their properties for the purpose of constructing a 10-foot-wide common driveway to their street, on which each of them had only five feet of frontage. After the driveway had been constructed, the town constructed a new road abutting the woman's property in the rear. The woman constructed a new driveway to that new street, and soon thereafter ceased using the common driveway. One year later, the woman sold the property to a buyer, who used the new driveway for four years and did not use the old one. The man then commenced using the entire 10 feet of the old driveway by parking his cars on both sides, and the buyer commenced an action to prevent the man's use of the five feet of the driveway on the buyer's land. The period for acquiring title by adverse possession in the jurisdiction is five years. What is the likely outcome of the action? A The buyer will prevail because nonuse is insufficient to cause abandonment of the easement. B The buyer will prevail because he is a bona fide purchaser. C The man will prevail because the easement was abandoned by the woman and the buyer through their use of only the new driveway. D The man will prevail because the period required for adverse possession is five years.

(A) Rationale: The buyer will prevail. The easement in this case is an easement by grant. That easement was not used for five years, but there were neither acts which would have terminated that easement by adverse possession, nor was there a manifested intent to abandon. Exam Tip: Don' t be fooled by very long periods of nonuse in the facts make sure there is an act showing intent; otherwise, there can be no termination. Therefore, the easement was not terminated by mere nonuse, and the buyer will prevail as the successor to the easement granted to the woman. (B) is incorrect. While it correctly states that the buyer will prevail, his success does not depend on his status as a bona fide purchaser. The buyer holds the easement solely because it is appurtenant to the land which he purchased. His good faith in purchasing the land and paying value for it did not enlarge his rights. (C) is incorrect because nonuse alone does not terminate an easement. For the easement to be terminated by nonuse, it would have to be accompanied by an intention to abandon the easement, or the fee owner (the man) would have to exclude the buyer from using the easement in an open and notorious manner for the period necessary to acquire an easement by prescription. (D) is incorrect because the acts of the man in using a common driveway for over five years do not constitute the open and notorious blocking of the easement which is required to terminate an easement by adverse possession. When the man did start blocking the easement, the buyer took action to preserve his rights.

Covenants: Written promise to do or not do something related to the land (maintain a fence, not build a multifamily dwelling). Unlike an easement because it is not the grant of a property interest. An equitable servitude is a type of Covenant, specifically a promise that equity will enforce against successors of the burdened land regardless of whether it runs with the land at law, unless the successor is a bona fide purchaser (meaning, a subsequent purchaser for value without notice of the covenant). If P wants monetary damages, construe promise as covenants. If P wants an injunction or specific performance, construe promise as an equitable servitude. Which of the following is not required for the burden of an equitable servitude to run to successors in interest? A The covenant touches and concerns the land. B There is vertical privity between the covenantor and their successor in interest. C The successor in interest has notice of the covenant if they have given value. D The covenanting parties intended that successors in interest be bound by the covenant.

(B) Vertical privity between the covenantor and their successor in interest is not required for the burden of an equitable servitude to run to successors in interest. An equitable servitude is a covenant (that is, a promise to do or not to do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against successors of the burdened land unless the successor is a bona fide purchaser (meaning, a subsequent purchaser for value without notice of the covenant). The burden of an equitable servitude will run to successors in interest if: 1. The covenanting parties intended that successors in interest be bound by the covenant; 2. The successor in interest has notice of the covenant (if they've given value); and 3. The covenant touches and concerns the land (that is, it benefits the covenantor and their successor in their use and enjoyment of the burdened land). A subsequent purchaser for value of land burdened by a covenant is not bound by it in equity unless they had notice of the covenant when they acquired the land. Note that in most states, successors of the burdened land who are not purchasers (for example, donees) are bound by the covenant whether or not they had notice. Horizontal privity between the original covenanting parties and vertical privity between the covenantor and their successor in interest are not required.

A landowner owned a large parcel of land in a rural area. He built his home on the northern half of the property, and developed a large orchard of fruit trees on the southern portion. A county road ran in front of the northern portion. To service his orchard, the landowner built a driveway directly from the county road across the northern portion of the property to the orchard. To provide electricity to his house, the landowner ran an overhead power line across the orchard property to hook up to the only available electric power pole located on the far southern side of the property. Subsequently, the landowner conveyed the northern parcel to his brother and the southern parcel to his daughter, who said that she did not mind having the power line on the property. Recently, the brother has begun parking his car on the driveway, thus blocking the daughter's access to the southern parcel. Finding no recorded document granting an easement for the power line, the daughter has decided to remove it. If the brother is successful in preventing the daughter from removing the power line, what is the likely reason? A The daughter knew that the power line ran across the land when she accepted the deed from the landowner. B The brother's alternative access to power is much less convenient and would cost 100 times as much C The daughter told the landowner that she did not mind having the power line on the property. D The daughter is acting in retaliation against the brother for blocking the driveway, and not in any good faith belief that she has the right to remove the power line.

(B) If the brother is successful in preventing the daughter from removing the power lines, it will be because the brother's alternative access to power is much less convenient and would cost 100 times as much as the current arrangement. This helps to prove that there was an easement implied by operation of law ("quasi-easement"). An easement may be implied if, prior to the time the tract is divided, a use exists on the "servient part" that is reasonably necessary for the enjoyment of the "dominant part," and a court determines that the parties intended the use to continue after division of the property. To give rise to an easement, a use must be apparent and continuous at the time the tract is divided. In this case, the landowner used the servient part of his property (the southern parcel) to run an overhead power line to the dominant part of his property (the northern parcel). Overhead wires are clearly visible and would be readily discoverable on reasonable inspection. The lines are, therefore, apparent. The use must also be reasonably necessary. Whether a use is reasonably necessary depends on many factors, including the cost and difficulty of the alternatives. This use was reasonably necessary to the enjoyment of the dominant parcel because electricity is important to the enjoyment of the property, and the cost (100 times as much) and difficulty of the alternatives are excessive. Thus, the fact that the use of the southern parcel is reasonably necessary would bolster the brother's case. (A) is wrong because the daughter's actual knowledge is irrelevant. The daughter need not be aware of the use; it need only be shown that the use was apparent (see above). (C) is similarly wrong. Oral statements made to the grantor after the northern parcel had been conveyed have little effect. They show the daughter's knowledge, but as discussed above, that has little relevance with respect to an implied easement. (D) is wrong because the daughter's motive for removing the power line is also irrelevant. If no easement is established, the daughter may remove the lines for whatever reason she likes. If, however, the requirements for an implied easement are satisfied, the daughter may not remove the lines regardless of how good her reasons are.

A retiree purchased a rustic cabin on a small plot of land near the center of a landowner's large parcel of land. The deed to the land, which the landowner delivered to the retiree for fair consideration, did not specifically grant an easement over the landowner's property to reach the public highway bordering her land. There were two means of access to the cabin from the public roads: a driveway from the county road on the south, and a private road from the highway on the east. The landowner told the retiree that he could use the private road from the highway. Twice during his first two years at the cabin, the retiree took the driveway from the county road instead; at all other times he used the private road. At the end of his second year at the cabin, the retiree began reading tarot cards to supplement his retirement income. He had a steady stream of clients coming to his home at all hours of the day and night. Most of the clients came in on the driveway from the county road, which ran close to the landowner's home. The landowner objected, and told the retiree that neither he nor his clients had any right to use that driveway and that they must use the private road from the highway. The retiree refused, and he and his clients continued to use the driveway from the county road for three years. Finally, the landowner began blocking off the driveway from the county road. The retiree brought suit to enjoin this practice. The prescriptive period in this jurisdiction is five years. Who will most likely prevail? A The landowner, because the tarot business has changed the nature of the use of the easement by necessity. B The landowner, because she may select the location of the easement. C The retiree, because he has a valid easement by necessity in the driveway from the county road. D The retiree, because he has acquired an easement by prescription in the driveway from the county road.

(B) The landowner will prevail in a suit because she, as the holder of the servient estate, has the right to choose the location of an easement by necessity. An easement by necessity arises when the owner of a tract of land sells a part of the tract and by this division deprives one lot of access to a public road or utility line. The owner of the servient parcel has the right to locate the easement, provided the location is reasonably convenient. The landowner has chosen the private road from the highway; thus, the retiree has no right to use the driveway from the county road. Both (A) and (C) are incorrect because the retiree has no easement by necessity in the driveway. As stated above, the owner of the servient parcel (the landowner) has located the easement in the private road; thus, no easement in the driveway exists. When the owner of an easement uses it in a way that exceeds its legal scope (i.e., the easement is surcharged), the servient landowner may enjoin the excess use and possibly collect damages. If the easement by necessity had been located in the driveway, the excess use from the tarot business could have been the basis for the court's ruling in the landowner's favor. However, as stated above, the easement is in the private road from the highway. (D) is incorrect because the retiree's use has not been continuous for the five-year period. To acquire an easement by prescription, the use must be: (i) open and notorious, (ii) adverse, and (iii) continuous and uninterrupted for the statutory period. Continuous adverse use does not mean constant use. Periodic acts that put the owner on notice of the claimed easement fulfill the requirement. In this case, however, two uses in the first two years would not be sufficient to put the landowner on notice that the retiree intended to claim an easement in the driveway. Therefore, the retiree has not acquired a prescriptive easement in the driveway from the county road.

Which of the following transfers creates an assignment of the lease from T to T2? A Four years into a six-year tenancy for years, T orally transfers his entire interest to T2 for two years. B Two years into a four-year tenancy for years, T "assigns my entire interest to T2 for one year". C One year into a five-year tenancy for years, T transfers his interest "to T2 for four years; however, if T2 breaches the original lease terms, T may reenter and retake the premises". D Six months into a tenancy at will, T transfers "my entire interest to T2".

(C) If one year into a five-year tenancy for years, T transfers his interest "to T2 for four years; however, if T2 breaches the original lease terms, T may reenter and retake the premises," the effect of the transfer is an assignment of the lease from T to T2. A complete transfer of the entire remaining lease term constitutes an assignment of the lease. If the tenant retains any part of the remaining lease term, other than a right of reentry for breach of the original lease terms, the transfer is a sublease. Here, T transferred the remaining four years of the lease to T2. By the slight majority view, T's reservation of a right of reentry does not result in a sublease, but rather is still an assignment. If six months into a tenancy at will, T transfers "my entire interest to T2," the attempted assignment is void and terminates the tenancy at will by operation of law. A tenancy at will is a leasehold estate that is terminable at the will of either the landlord or the tenant. Such a tenancy terminates by operation of law if: 1. Either party dies; 2. The tenant commits waste; 3. The tenant attempts to assign his tenancy; 4. The landlord transfers her interest in the property; or 5. The landlord executes a term lease to a third person. If two years into a four-year tenancy for years, T "assigns my entire interest to T2 for one year," the effect of the transfer is to create a sublease between T and T2. The label given to the transfer by the parties does not determine whether the transfer is an assignment or a sublease. The nature of the transaction is determined by what interest, if any, the tenant retains. Here, although T "assigned" his interest to T2, he transferred only one of the remaining two years of the lease. Thus, the transfer is a sublease rather than an assignment. If four years into a six-year tenancy for years, T orally transfers his entire interest to T2 for two years, the attempted assignment is ineffective under the Statute of Frauds. Most states require that a lease creating a tenancy for more than one year, including an assignment of an interest in a lease for more than one year, be in writing to satisfy the Statute of Frauds.

A developer created an exclusive residential subdivision. In his deed to each lot, the following language appeared: "Grantee agrees for himself and assigns to use this property solely as a single-family residence, to pay monthly fees as levied by the homeowners' association for upkeep and security guard services, and that the backyard of this property shall remain unfenced so that bicycle paths and walkways may run through each backyard, as per the subdivision master plan [adequately described], for use by all residents of the subdivision." The developer sold lots to an actuary, a baker, and a coroner. All deeds were recorded. The subdivision was developed without backyard fences, with bicycle paths and walkways in place in accordance with the general plan. The actuary in turn sold to an accountant by a deed that omitted any mention of the covenants above, and the accountant had no actual knowledge thereof. Shortly thereafter, the accountant started operating a tax preparation business out of his home. The baker in turn sold to a barber, who knew of, but refused to pay, the monthly fees levied by the homeowners' association. The coroner leased their property for 10 years to a chiropractor, who erected a fence around the backyard, unaware of the covenant against such fencing. According to common law principles, which of the following statements is correct? A If the developer, still owning unsold lots, sues the accountant to have him cease operating the tax preparation business, the accountant would win because there is no privity between the developer and the accountant. B If the homeowners' association sues the barber to collect the monthly fees for upkeep and security guard services, the homeowners' association would win because the covenant regarding fees is enforceable in equity against the barber. C If the barber sues the chiropractor to obtain removal of her backyard fence, the barber would win because the covenant regarding fencing is enforceable in equity against the chiropractor. D If the chiropractor sues the accountant to have him cease operating the tax preparation business, the chiropractor would win because the covenant regarding single-family use is enforceable at law against the accountant.

(C) If the barber sues the chiropractor to remove her backyard fence, the barber would win because the covenant regarding fencing is enforceable against the chiropractor as an equitable servitude. An equitable servitude is a covenant that, regardless of whether it runs with the land at law, equity will enforce against the successors of the burdened land unless the successor is a bona fide purchaser (meaning, a subsequent purchaser for value without notice of the covenant). The benefit of an equitable servitude runs to successors if: (i) the original parties so intended, and (ii) the servitude touches and concerns the land. The burden runs if (i) and (ii) are met and (iii) the subsequent purchaser has actual or constructive notice of the covenant. Privity of estate is not needed to enforce an equitable servitude because it is enforced not as an in personam right against the owner of the servient tenement, but as an equitable property interest in the land itself. Here, the original parties intended for the fencing covenant to be enforceable by and against assignees, as shown by the specific language of the covenant ("Grantee agrees for himself and assigns") and its purpose to provide bicycle paths and walkways running through each backyard for the use of all subdivision residents. The benefit of the covenant touches and concerns the barber's property because it increases his enjoyment thereof by providing him with such paths and walkways. Therefore, the barber is entitled to enforce the covenant. The burden of the covenant touches and concerns the land occupied by the chiropractor because it restricts the landholder in their use of the parcel (that is, her rights in connection with the enjoyment of the land are diminished by being unable to fence in the backyard). The chiropractor will be deemed to have both record and inquiry notice of the restriction. The restriction is contained in deeds in the chiropractor's chain of title, and that can confer record notice, despite the fact that we don't typically think of lessees doing title searches. The recording acts protect purchasers of the fee or any lesser estate, which would include a leasehold estate. The chiropractor also has inquiry notice because the subdivision is sufficiently developed in accordance with a general plan for the subdivision. Moreover, any neighbor in a subdivision can enforce a covenant contained in a subdivision deed if a general plan existed at the time he purchased his lot. As has been noted, the maintenance of access to all backyards for use as bike paths and walkways was part of such a general plan. Finally, the fact that the chiropractor did not succeed to the coroner's entire estate, but rather a leasehold interest, is irrelevant because privity is not required to enforce an equitable servitude. Therefore, all of the requirements are in place for the existence of an equitable servitude, which can be enforced by the barber against the chiropractor. (A) is incorrect because there is privity between the developer and the accountant. There was horizontal privity between the original covenanting parties because, at the time the actuary entered into the covenant with the developer, they shared an interest in the land independent of the covenant (that is, they were in a grantor-grantee relationship). The accountant holds the entire interest held by the actuary at the time the actuary made the covenant; thus, there is vertical privity. (B) is incorrect because the remedy sought is the payment of money. Breach of a real covenant, which runs with the land at law, is remedied by an award of money damages, whereas breach of an equitable servitude is remedied by equitable relief, such as an injunction or specific performance. Because the homeowners' association seeks to obtain from the barber the payment of money, it is inaccurate to refer to this as a situation involving an equitable servitude. (D) is incorrect because, as explained above, if equitable relief is sought, the covenant must be enforced as an equitable servitude rather than a real covenant.

O conveys a life estate to A, with a remainder to B. If during A's lifetime, X enters into actual, exclusive possession that is open and notorious and hostile for the statutory period, will X obtain title to the land? A Yes, if X had color of title B No, because land subject to a future interest cannot be acquired by adverse possession C No, but X will acquire A's life estate D Yes, because X satisfied the elements of adverse possession

(C) No, X will not obtain title to the land. If during A's lifetime, X enters into actual, exclusive possession that is open and notorious and hostile for the statutory period, X will not obtain title to the land, but X will acquire A's life estate. If a landowner does not commence an action to eject a would-be adverse possessor before the statute of limitations expires, she is barred from suing for ejectment, and title vests in the possessor. However, the statute of limitations does not run against the holder of a future interest (e.g., remainder, reversion) until her interest becomes possessory. The future interest holder has no right to possession until the prior present estate terminates, and thus no cause of action for ejectment accrues until that time. Here, X will acquire A's life estate by adverse possession (i.e., a life estate pur autre vie, measured by A's life), but not B's remainder, which remains nonpossessory while A is living. Thus, upon A's death, X's interest will terminate. This is true even though X satisfied the elements of adverse possession. To establish title by adverse possession, the occupier must show: (i) An actual entry giving exclusive possession that is (ii) Open and notorious, (iii) Adverse (hostile), and (iv) Continuous throughout the statutory period. Land subject to a future interest CAN be acquired by adverse possession; however, the statute will not begin to run as against the future interest holder until her interest becomes possessory, as explained above. This is true regardless of whether X had color of title (i.e., a document purporting to convey title).

On April 15, a seller entered into a valid written agreement to sell her home to a buyer for $175,000. The provisions of the agreement provided that closing would be at the buyer's attorney's office on May 15, and that the seller would deliver to the buyer marketable title, free and clear of all encumbrances. On the date of closing, the seller offered to the buyer the deed to the house, but the buyer refused to go ahead with the purchase because his attorney told him that a contractor who had done work on the house had recorded a lis pendens on May 1 against the property regarding a $10,000 contract dispute he had with the seller. The seller indicated that she was unaware of the lien, but that she was willing to go ahead with the sale and set aside funds from the purchase price to cover the contractor's claim until the dispute was resolved. The buyer still refused to proceed, stating that the seller had breached the contract. If the seller brings an action against the buyer for specific performance, what is the probable result? A The buyer prevails, because the title to the property was not marketable as of the date of closing. B The buyer prevails, because an encumbrance was on the title as of the date of closing that was subject to litigation. C The seller prevails, because under the doctrine of equitable conversion, the buyer was the owner of the property when the lis pendens was recorded, and therefore it was invalid. D The seller prevails, because an implied term of their contract was that she could use the proceeds to clear any encumbrance on the title.

(D) The seller will likely prevail because she is entitled to clear the encumbrance with the proceeds of the sale. In a contract for the sale of real property, the seller of the land is entitled to use the proceeds of the sale to clear title if she can ensure that the purchaser will be protected. The seller's offer to escrow the funds in this case should act as such guarantee. Thus, (A) is incorrect. (B) is incorrect because, although there will be litigation over the contract dispute, the litigation will not affect the title to the land because the contractor is claiming only money damages and not an interest in the property. (C) is incorrect because the doctrine of equitable conversion is only applicable as against the seller and the buyer, and does not affect the right of some third party with regard to attaching property held in the name of a debtor.

A man had rented a woman's home from her for seven years. When the time came to sign a new lease, the woman decided that because the man had always been a quiet tenant, she would continue to charge him only $350 per month rent instead of the $500 to $550 she could probably get otherwise. The new lease was for a period of five years, and by its terms, the man was specifically prohibited from assigning the lease without the woman's specific written consent. About a year later, the man got married and moved into his new wife's home. Instead of giving up his lease, the man sublet the property to a friend for $500 a month. The man did not get the woman's permission to sublease the property. If the woman brings an action to either eject the friend from the premises or to recover damages from the man for subletting the premises without her consent, what is the most likely result? AThe woman will be able to recover damages and to eject the new tenant. BThe woman will be able to eject the new tenant only, because she has suffered no money damages. C The woman will not be able to eject the new tenant because, although the man did not have the right to sublet, he had the power, but she will be entitled to recover the full rent paid by the new tenant because it would be unfair to let the man profit from his wrongful act. DThe woman will have no cause of action for either ejectment or damages.

(D) The woman will most likely have no cause of action for either ejectment or damages. There are two ways for a tenant to transfer the right to possession under a lease: assignment (transferring the entire period of time remaining under the lease) and sublease (transferring only a portion of the time remaining under the lease). Restraints on alienation are traditionally strictly construed. Thus, a covenant prohibiting assignment does not prohibit subleasing and vice versa. Hence, this prohibition against assignment would not be read to include a prohibition against subleasing. Therefore, the woman would have no cause of action against the man, and (A) and (B) are incorrect. (C) is incorrect. If a tenant transfers (assigns or sublets) in violation of a prohibition in the lease against transfers, the transfer is not void, but the landlord usually may terminate the lease under either the lease terms or a statute. Here, however, there is no cause of action because subleasing was not prohibited.

A landowner owned a large tract of land, which he divided into two parcels. The northern parcel abutted a public highway. The shortest route from the southern parcel to the highway was over a private road that crossed the northern parcel. The other route was over a single-lane dirt and gravel path that wound for over four miles through the woods. The landowner sold the southern parcel to a developer, including an express easement in the private road across the northern parcel. The landowner knew of the developer's plans to open an inn on the property. The developer built the inn but never opened it to the public. Fifteen years later, the developer sold the southern parcel to an investor, who planned to open the inn to the public. The developer had never properly recorded her deed to the land, but the investor promptly recorded her deed, which made no mention of a right to cross the northern parcel via the private road. About a week after the investor took possession of the southern parcel, she learned of the provision in the developer's deed to the land. However, the landowner refuses to grant the investor permission to use the road across his property to reach the highway. Does the investor have a right to cross the northern parcel? ANo, because the easement is not mentioned in the investor's deed, and the developer's deed containing the easement was not recorded. BNo, because the investor's opening of the inn would increase the use of the easement. CYes, but only if the developer exercised her right to use the easement when she owned the southern parcel. DYes, even if the developer never exercised her right to use the easement when she owned the southern parcel.

(D) The investor has an easement to cross the northern parcel even if the developer never exercised her right to use the easement. The original easement granted to the developer was an easement appurtenant, the benefit of which passes with a transfer of the benefited land. An easement is deemed appurtenant when the right of special use benefits the easement holder in her physical use or enjoyment of another tract of land. The land subject to the easement is the servient tenement, while the land having the benefit of the easement is the dominant tenement. The benefit of an easement appurtenant passes with transfers of the benefited land, regardless of whether the easement is mentioned in the conveyance. All who possess or subsequently succeed to title to the dominant tenement are entitled to the benefit of the easement. The easement granted to the developer was an easement appurtenant because the right to use the private road across the northern parcel (the servient tenement) benefited the developer in her use and enjoyment of the southern parcel (the dominant tenement) by providing her with the most convenient access to the public highway. Thus, when the developer sold the benefited land to the investor, the benefit of the easement also passed to the investor as an incident of possession of the southern parcel. (A) is incorrect because, as explained above, this benefit passed to the investor despite the fact that the deed to the investor made no mention of the easement. The failure to record does not affect the validity of the easement. Recordation is not essential to the validity of a deed, but only serves to protect the interests of a grantee against subsequent purchasers. Here, the dispute is between the original grantor and the successor of the original easement holder. The purpose of most recording statutes is to provide notice to a burdened party. The person who granted the easement is in no need of notice. The only relevance of recording in this situation is with respect to the servient tenement, the northern parcel. The grant of easement should be recorded on the northern parcel, or bona fide purchasers from the landowner will take free of it. However, no such purchasers are involved in this question. (B) is incorrect because the investor's use of the easement would not be a change in its use. This choice goes to the scope of the easement. The key for determining the scope is the reasonable intent of the original parties, including the reasonable present and future needs of the dominant tenement. Here, because the landowner knew of the developer's plans to open an inn, he knew that she and her guests would use the road across the northern parcel. The investor's use of the easement would be the same-her use and that of her guests. This is not a change in intended use sufficient to allow the landowner to legally prevent the investor's use of the easement. (C) is incorrect because nonuse does not extinguish an easement. Abandonment, which does terminate an easement, requires a physical act by the easement holder that manifests an intent to permanently abandon the easement (e.g., erecting a building that blocks access to an easement of way). Because there is no indication of such an act by the developer, the easement continues to benefit the southern parcel even if the developer never used it.

A landlord entered into a 10-year lease of a building with an auctioneer, who planned to use the building itself for a storage area and the covered porch at the front of the building for auctions. A term in the auctioneer's lease stated, "Lessor agrees to maintain all structures on the property in good repair." Four years into the lease, the landlord sold the property to a buyer. The buyer did not agree to perform any obligations under the lease. As instructed, the auctioneer began paying rent to the buyer. In the fifth year of the lease, the porch roof began to leak. Citing the lease terms, the auctioneer asked the buyer to repair the roof. He continually refused to do so. The auctioneer finally repaired the roof herself at a cost of $2,000. The auctioneer then brought an appropriate lawsuit to recover the money. Absent any other facts, what is the auctioneer likely to recover? A$2,000 from the landlord only, because the sale of the property did not sever his obligation to the auctioneer. B$2,000 from the buyer only, because a covenant to repair runs with the land. C$1,200 from the buyer and $800 from the landlord, because that represents their pro rata shares. D$2,000 from either the buyer or the landlord, because they are both in privity with the auctioneer.

(D) The auctioneer may recover the cost of repair from either the landlord or the buyer. A landlord's promise in a lease to maintain the property does not terminate because the property is sold. Although no longer in privity of estate, the original landlord and tenant remain in privity of contract, and the original landlord remains liable on the covenant unless there is a novation. A novation substitutes a new party for an original party to the contract. It requires the assent of all parties and completely releases the original party. Because neither the auctioneer nor the buyer has agreed to a novation, the landlord remains liable for the covenant because he and the auctioneer remain in privity of contract even after the sale. Thus, the promise to repair can be enforced against the landlord. When leased property is sold, the purchaser may be liable for his predecessor's promises if the promise runs with the land. A covenant in a lease runs with the land if the parties to the lease so intend and the covenant touches and concerns the land. Generally, promises to do a physical act, such as maintain or repair the property, are considered to run with the land. Thus, the buyer is liable because he is in privity of estate with the auctioneer and the covenant to repair runs with the land. Consequently, both the landlord and the buyer are potentially liable to the auctioneer for the repairs. While it is true that the sale/assignment to the buyer did not sever the landlord's obligation to the auctioneer, as explained above, the landlord is not the only person who is liable to the auctioneer. Because both the landlord and the buyer are potentially liable for the repairs, (A) is incorrect. (B) is incorrect because although it is true that a covenant to repair touches and concerns the land and runs with it on assignment, the landlord as well as the buyer can be held liable. (C) is incorrect because the auctioneer may recover the full amount from either the landlord or the buyer.

A landowner and her neighbor owned adjoining parcels of land. The landowner's property was situated to the west of the neighbor's property. A highway ran along the east of the neighbor's property. Twelve years ago, the landowner asked the neighbor if it would be all right for the landowner to use an eight-foot strip along the northern part of the neighbor's land to access the highway. The only other way for the landowner to get to the highway was to use a one-lane unpaved road that meandered through the woods for two miles. The neighbor agreed, and the landowner used the strip of land regularly to access the highway. The statutory period for adverse possession in this jurisdiction is 10 years. What is the landowner's interest in the neighbor's eight-foot strip of land? A An easement appurtenant.An easement appurtenant. B An easement by necessity.An easement by necessity. C An easement by prescription.An easement by prescription. Correct D Not an easement.

(D) The landowner's interest in the neighbor's eight-foot strip of land is not an easement. In effect, the landowner only has a "license" (i.e., a revocable privilege) to use the land. The answer is best reached by the process of elimination. Because an easement is an interest in land, the Statute of Frauds applies. Here, the agreement between the landowner and the neighbor was not in writing; thus, the Statute of Frauds requirements for the creation of an express easement were not met. Therefore, (A) is incorrect. (B) is incorrect because an easement by necessity is created when the owner of land sells a part of it and deprives the part sold of access to the public road. Here, the facts do not indicate that the landowner's and the neighbor's parcels were once part of a common tract, and the landowner has an alternate, albeit inconvenient, way to access the highway-the one-lane road. Thus, the landowner does not have an easement by necessity. (C) is incorrect because the landowner's use of the land was permissive. To acquire a prescriptive easement, the use must be open and notorious, adverse, and continuous and uninterrupted for the statutory period. Although the landowner used the strip for the requisite 10-year period, she does not meet the adverse requirement necessary to obtain a prescriptive easement.

Uncle => conveys via general warranty deed to niece and nephew in fee simple absolute Uncle then executes a written conveyance of the land, in trust, (for the benefit of the hunting club, for a period of 10 yrs) to niece & nephew (as trustees => then to niece & nephew in fee simple. --> Uncle dies. Nephew wants land used for hunting purposes, but niece threatens to have anyone caught hunting on the property arrested for trespassing. What will be the Cts equitable relief?

- The court should partition the land into two separate tracts. A court will treat it as a TENANCY in COMMON. => 1) Each of them has the right to possess all portions of the property AND 2) Neither of them has the right to exclusive possession of any part. HOWEVER, any tenant in common has a right to judicial partition of the property, either in kind (land division) or by sale and division of the proceeds. ---> When co-tenants are squabbling and cannot come to any agreement, the remedy of partition terminates the co-tenancy and divides the common property. Since the niece and nephew cannot agree on the use of the land by members of the hunting club, the court will probably partition the property. *Note, no trust was validly created bc the Uncle was no longer the owner of the land, from the time ow Warranty Deed.

If a woman starts using a neighbors driveway openly, then the neighbor writes a letter protesting the use, but she continues to use the land anyway, when does the Prescriptive Easement (an easement acquired through use) period begin?

- The woman's FIRST use of the driveway started the prescriptive period running. --> There is NO requirement of EXCLUSIVE USE for the woman to obtain an easement by prescription. (many ppl may be using the easement). ---> EXCLUSIVITY IS ONLY required in cases of Adverse Possession. ---> Adverse possession is not at issue here because the woman had NOT POSSESSED any part of the west parcel (she just passes through the land) AND --> THUS, she DOES NOT REQUIRE the title of AP to CONTINUE USE of the property, which is all she seeks.

Which of the following acts will terminate an easement?

8 Ways to Terminate an Easement: END CRAMP Estoppel Necessity: Easements created by necessity expire as soon as the necessity ends, unless the easement was reduced to an express grant. Destruction Condemnation: An oral expression of an intent to abandon an easement won't terminate an easement unless it's also committed to writing (a release) or accompanied by action (abandonment). But if the servient owner materially changes their position in reasonable reliance on the easement holder's assurances or representations (such as that the easement will no longer be enforced), the easement terminates through estoppel. Release: A release given by the easement holder to the servient land owner will terminate the easement. Abandonment Merger Prescription: A servient owner may extinguish the easement by interfering with it in accordance with the elements of adverse possession Condemnation of the servient estate will terminate an easement. The easement holder may be entitled to compensation for the value lost. Use of the easement beyond its legal scope will not terminate an easement. Instead, the easement is surcharged, and the servient owner may sue to enjoin the use. Nonuse of the easement for the statutory period will not terminate an easement. An easement can be extinguished by the easement holder's physical act of abandonment (e.g., erection of a permanent structure over the easement). However, mere nonuse, even for a long period of time, is insufficient to constitute an abandonment of the easement. To terminate the easement, the nonuse must be combined with other evidence of intent to abandon it. Voluntary destruction of the servient estate (e.g., tearing down a building to erect a new one) will not terminate an easement. On the other hand, involuntary destruction of the servient estate (e.g., by fire or flood) will extinguish the easement.

If property is given in which the Donor seeks to prohibit the Recipient from selling or transferring his interest in the property.

A Restraint on Alienation => a clause used in the conveyance of real property that seeks to prohibit the Recipient from selling or otherwise transferring his INTEREST in the property. --> Direct Restraints on Alienation of a fee simple are void. - Thus, the son received a fee simple in the property. The grandfather attempted to give his son a fee simple, but by placing a restraint on alienation, the grant now simply reads as if it had been "O to A in fee simple." - The grandson gets nothing.

A landowner gratuitously conveyed his interest in land to a friend by quitclaim deed. The friend promptly and properly recorded her deed. Six months later, the landowner conveyed his interest in the same land to an investor for $50,000 by warranty deed, which was promptly and properly recorded. As between the friend and the investor, who has the superior right to title to the land? response - incorrect A The friend, regardless of the type of recording statute. B The friend, because she recorded prior to the investor's recording. C The investor, regardless of the type of recording statute. D The investor, because it took by warranty deed rather than quitclaim deed.

A The friend, regardless of the type of recording statute. Because the friend recorded prior to the subsequent conveyance, she has the superior right to title regardless of the type of recording statute. A conveyance that is recorded can never be divested by a subsequent conveyance through operation of the recording statutes. By recording, the grantee gives constructive (or "record") notice to everyone. Hence, proper recording prevents anyone from becoming a subsequent bona fide purchaser ("BFP"). Because the landowner's conveyance to the friend was recorded at the time of the landowner's conveyance to the investor, the investor cannot prevail. The investor will clearly lose under a pure race statute because the friend recorded first. The investor will also lose under notice and race-notice statutes because the conveyance to the friend was recorded at the time of the conveyance to the investor. The investor, therefore, had record notice and cannot claim the protection that these types of statutes provide for subsequent purchasers for value who take without notice. Thus, (A) is correct and (C) is incorrect. The fact that the friend is merely a donee rather than a BFP does not mean that her recording has no effect. It is only the subsequent taker who has to be a BFP rather than a donee to utilize the recording statute. The prior grantee, regardless of her status, protects her interest by recording because it prevents anyone from becoming a subsequent BFP. (B) is incorrect because, as noted above, the friend will prevail under any type of recording act, but not necessarily because she recorded prior to the investor's recording. If the jurisdiction has a notice statute, whether the friend recorded prior to the investor's recording is irrelevant. Rather, it is the fact that the friend recorded prior to the investor's purchase that gives the friend superior title in a notice jurisdiction, because the investor would have record notice of the conveyance and thus would not qualify as a BFP. (D) is incorrect because the quitclaim/warranty deed distinction does not affect who has title to the land; that status merely affects the parties' respective causes of action and ability to recover against the landowner.

On February 10, an owner took out a $10,000 mortgage on her land with a bank. On February 15, the owner conveyed the land for $50,000 to a buyer who was not aware of the mortgage. On February 17, the bank recorded its mortgage interest in the land. On February 21, the buyer recorded his deed to the land. Does the buyer hold the land subject to the bank's mortgage? response - incorrect A Yes, in a race-notice jurisdiction. B Yes, regardless of the type of recording statute. C No, in a race-notice jurisdiction. D No, because the buyer was a bona fide purchaser for value who bought the land before the bank recorded its mortgage.

A Yes, in a race-notice jurisdiction. The buyer takes subject to the bank's mortgage in a race-notice jurisdiction because it was recorded first. All recording acts apply to mortgages as well as deeds. Thus, a subsequent purchaser of the property will take subject to a prior mortgage unless the recording act changes the result. A race-notice recording act would change this result only where a subsequent purchaser did not have notice of the mortgage at the time of purchase and recorded his deed before the mortgage was recorded. Here, the buyer did not have notice of the mortgage but he recorded after the bank; thus, he takes subject to the bank's interest. (C) is wrong because the buyer did not win the race to record, which is one of the two requirements for a subsequent purchaser to prevail in a race-notice jurisdiction. (B) is wrong because the buyer would not take the land subject to the bank's mortgage in a pure notice jurisdiction. Under a notice recording act, a subsequent bona fide purchaser with no actual or constructive notice prevails over a prior grantee or mortgagee who has not recorded at the time of the conveyance to the subsequent purchaser. (D) is not the best answer because it would only be true in a notice jurisdiction. The buyer would take subject to the mortgage in a pure race or race-notice jurisdiction because the mortgage was recorded before the buyer's deed (even though the buyer did not have notice of the mortgage when he bought the land).

May a grantee be bound by a covenant that does not appear in his deed or chain of title? A No, if the deed is a quitclaim deed. B No, if the deed contains a covenant against encumbrances. C Yes, if there is a common scheme for development and the grantee had notice of the covenant. D Yes, if the covenant touches and concerns the land.

A grantee may be bound by a covenant that does not appear in his deed or chain of title if there is a common scheme for development and the grantee had notice of the covenant. An equitable servitude is a covenant (i.e., a promise to do or not to do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against successors to the burdened land who have notice of the covenant. Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, in the absence of a writing, negative equitable servitudes may be implied if (i) there is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant), and (ii) the grantee had actual, record, or inquiry notice of the covenant. Except as explained above, a grantee may not be bound by a covenant that does not appear in his deed or chain of title even if the covenant touches and concerns the land. The burden of an equitable servitude will run to successors in interest if: (i) the covenanting parties intended that successors in interest be bound by the covenant; (ii) the successor in interest has notice of the covenant; and (iii) the covenant touches and concerns the land (i.e., it benefits the covenantor and her successor in their use and enjoyment of the burdened land). In the absence of a writing, however, the servitude will not be enforced unless there is a common scheme for development as explained above. A grantee may be bound by a covenant that does not appear in his deed or chain of title even if the deed contains a covenant against encumbrances. This is a covenant contained in a general warranty deed assuring that there are neither visible encumbrances (e.g., easements) nor invisible encumbrances (e.g., mortgages) against the title or interest conveyed. The presence of this covenant does not affect the ability of a successor in interest to the covenantee to enforce an equitable servitude. A grantee also may be bound by a covenant that does not appear in his deed or chain of title even if the deed is a quitclaim deed. This type of deed conveys whatever interest, if any, the grantor has in the property. It does not affect the ability of a successor in interest to the covenantee to enforce an equitable servitude.

To buy a house, an investor secured a $10,000 mortgage from a bank. The bank promptly and properly recorded its mortgage. Subsequently, the investor financed certain improvements to the house with a $2,000 mortgage on the land from a finance company. The finance company promptly and properly recorded its mortgage. Before the investor made a payment on either mortgage, the federal government announced that it would begin storing nuclear waste products in the area. The value of property, including the investor's house, plummeted. The investor did not pay either the bank or the finance company, and the bank brought a proper action to foreclose, notifying both the investor and the finance company. A buyer bought the house at the foreclosure sale for $6,000, which was its fair market value. There are no special statutes in the jurisdiction regarding deficiency judgments. What does the investor owe? response - correct A $5,000 to the bank and $1,000 to the finance company. B $4,000 to the bank and $2,000 to the finance company. C Nothing to the bank and $2,000 to the finance company. D $4,000 to the bank and nothing to the finance company.

B $4,000 to the bank and $2,000 to the finance company. Absent any anti-deficiency statutes, the investor remains personally liable to pay for any shortfall arising from the foreclosure sale. Proceeds from the sale are used to satisfy the loan that was foreclosed first. Hence, all of the proceeds ($6,000) went to the bank. Thus, the investor must pay the balance still due the bank ($4,000) and the entire amount of the finance company's mortgage ($2,000), which is terminated by the foreclosure of the senior mortgage. (A) is wrong because foreclosure sales are not allotted proportionally between senior and junior interests. (C) is wrong because foreclosure does not extinguish the underlying debt. (D) is wrong because the finance company's mortgage does not remain on the land after foreclosure of the senior mortgage; hence, the investor is liable for that debt as well.

To satisfy a debt owed to a creditor, a son executed and delivered to the creditor a warranty deed to a large tract of undeveloped land. The creditor promptly recorded the deed. Shortly thereafter, she built a house on the property and has lived there ever since. The son never actually owned the land. It belonged to his father, but the father had promised to leave the property to the son. Later, the father died and his will devised the property to the son. Pressed for money, the son then sold the land to an investor by warranty deed, which the investor promptly recorded. Although the investor paid full value for the property, he purchased it strictly for investment and never visited the site. He therefore did not realize that the creditor was living there, and knew nothing of the son's earlier deed to the creditor. The jurisdiction in which the land is located has the following statute: "A conveyance of an estate in land (other than a lease for less than one year) shall not be valid against any subsequent purchaser for value without notice thereof unless the conveyance is recorded." Which of the following is the most likely outcome of a quiet title action brought by the creditor against the investor? response - correct A The creditor prevails, because the son had no title to convey to the investor. B The creditor prevails, because the investor was not a purchaser for value without notice of the creditor's interest. C The investor prevails, because under the doctrine of estoppel by deed, title inures to the benefit of the original grantee only as against the grantor. D The investor prevails, because under the recording acts, the deed from the son to the creditor was not in the chain of title and hence did not constitute notice to the investor.

B The creditor prevails, because the investor was not a purchaser for value without notice of the creditor's interest. The creditor will prevail in a suit to quiet title because the investor had notice of the creditor's interest in the property and, thus, is not a bona fide purchaser for value. When a grantor purports to convey property that he does not own, his subsequent acquisition of title to that property vests in the grantee under the doctrine of estoppel by deed. Most courts, however, hold that this is personal estoppel, which means that title inures to the grantee's benefit only as against the grantor, not a subsequent bona fide purchaser. If the grantor transfers his after-acquired title to an innocent purchaser for value, the bona fide purchaser gets good title. There is a split of authority as to whether the original grantee's recordation of the deed imparts sufficient notice to prevent a subsequent purchaser from being a bona fide purchaser, but the majority view is that it does not because it is not in his chain of title. Thus, it is not the fact that the creditor recorded that prevents the investor from being a bona fide purchaser. The fact that the creditor built a home and was living on the property gave the investor constructive notice of her interest. A title search is not complete without an examination of possession. If the possession is unexplained by the record, the subsequent purchaser is charged with knowledge of whatever an inspection of the property would have disclosed and anything that would have been disclosed by inquiring of the possessor. Therefore, the investor is charged with knowledge of the creditor's possession and with what the creditor would have told him about her possession; i.e., that the property was conveyed to her by the son prior to his conveyance to the investor. Consequently, the investor does not qualify as a bona fide purchaser, and (C) is an incorrect choice. (A) is incorrect because, although the son is estopped to deny that he acquired title for the benefit of the creditor, he could have conveyed valid title to a subsequent purchaser for value who had no notice of the creditor's interest. Therefore, it is not exactly correct to say that the son had no title to convey. (D) is incorrect because the investor will not prevail. It is true that under the recording acts the creditor's deed was not in the chain of title, but the investor still does not qualify as a bona fide purchaser. The investor is on inquiry notice arising from the creditor's possession of the property.

A homeowner leased his home to a tenant for three years. The following year, the homeowner conveyed the house to a buyer, who never recorded her deed nor did anything with regard to the house. The tenant continued paying rent to the homeowner. Three months after the conveyance to the buyer, the homeowner conveyed the property to his cardiologist, who knew nothing of the prior conveyance to the buyer. The homeowner took the cardiologist's money and skipped town. The cardiologist told the tenant that he now owned the house and that all rents should be paid to him. The tenant complied. Six months later, the cardiologist went to his local bank for a loan. He offered to put up the property as security. The bank discovered that the cardiologist had never recorded his deed and that, just two weeks prior to his loan application, the buyer had recorded a deed to the house that bore an earlier date than the deed the cardiologist had shown the bank. Because of this cloud on the title, the bank refused the loan request. When the tenant discovered this, she quit paying rent to the cardiologist. The state has a recording statute that provides, "a conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded." If the cardiologist sues the tenant to compel the payment of rent, is the cardiologist likely to win? response - correct A Yes, because the tenant is estopped from denying a landlord-tenant relationship with the cardiologist, since she had paid rent for many months. B Yes, because the cardiologist was a bona fide purchaser when he bought the property from the homeowner. C No, because the cardiologist failed to record his deed to the property. D No, because the cardiologist does not have good title to the property and cannot demand rent from tenants in possession.

B Yes, because the cardiologist was a bona fide purchaser when he bought the property from the homeowner. The cardiologist will likely win. When the cardiologist bought the property from the homeowner, he was a bona fide purchaser who gave value and who had no notice of the earlier sale to the buyer. Not only did the cardiologist not have actual notice of the earlier sale, he did not have constructive notice either because the buyer did not record before the cardiologist bought. The recording statute in the jurisdiction is a notice statute. In a jurisdiction with a notice recording statute, a subsequent purchaser who gives value and takes without notice wins over the earlier grantee. If the facts had shown a jurisdiction with a race-notice recording act, the cardiologist would have been in trouble. With race-notice, the cardiologist would not only have to take without notice, he would have to be the first to record. Because the facts do not show that the cardiologist recorded at all, he would lose. But because this is a notice act jurisdiction, the fact that the buyer finally recorded before the cardiologist is irrelevant. (A) is incorrect. Simply because a tenant pays rent to someone who the tenant thinks owns the property does not create an estoppel requiring the tenant to continue paying rent to that person. The cardiologist will win, but not for this reason. (C) is incorrect because it is not necessary for a grantee to record a deed to give the grantee legal title to the property. Recordation is necessary only to protect against subsequent purchasers from the same grantor. Unrecorded deeds are perfectly valid as long as the recording act does not dictate otherwise. (D) is incorrect. The cardiologist did in fact have good title to the property because, as a bona fide purchaser, he was protected by the notice recording act.

Which of the following parties cannot be protected as a bona fide purchaser of land? response - incorrect A A donee from a bona fide purchaser of the land. B A purchaser from an heir to the land. C A devisee of the land. D A mortgagee of the land.

C A devisee of the land. A devisee of the land cannot be protected as a bona fide purchaser ("BFP") of land. Notice and race-notice recording acts protect BFPs from prior unrecorded conveyances of the same property. A BFP is a purchaser who takes land without notice of a prior instrument and pays valuable consideration. Donees, heirs, and devisees are not BFPs because they do not give value for their interests; i.e., they are not purchasers. A mortgagee of the land can be protected as a BFP of land. Mortgagees for value (but not those who receive a mortgage only as security for a preexisting debt) are treated as purchasers, either expressly by recording acts or by judicial classification. Thus, mortgagees for value who take without notice can be protected as BFPs. A purchaser from an heir to the land can be protected as a BFP of land. Donees, heirs, and devisees themselves are not purchasers and thus cannot be BFPs. However, one who buys land from such a party will be protected against a prior unrecorded conveyance from the record owner. A donee from a bona fide purchaser of the land can be protected as a BFP of land. Under the shelter rule, anyone who takes from a BFP will be treated like a BFP (i.e., will prevail against any interest her transferor would have prevailed against). This rule exists to protect the BFP by preserving his ability to convey property. It applies even when his transferee had actual knowledge of a prior unrecorded interest or did not take for substantial pecuniary value (i.e., was a donee). However, a non-BFP who previously had title cannot acquire BFP status by selling the land to a BFP and then repurchasing it.

When can a mortgagor exercise her statutory right of redemption? response - correct A Only during the foreclosure sale. B Before default. C After the foreclosure sale. D Before the foreclosure sale.

C After the foreclosure sale. A mortgagor can exercise her statutory right of redemption after the foreclosure sale. About half the states provide a statutory right to redeem for some fixed period after the foreclosure sale has occurred, usually six months or one year. The amount to be paid is the foreclosure sale price, rather than the amount of the original debt. This right extends to mortgagors and, in some states, to junior lienors. A mortgagor cannot exercise her statutory right of redemption before default, before the foreclosure sale or only during the foreclosure sale. In the states that provide it, the statutory right to redeem exists for a fixed period after the foreclosure sale. By contrast, all jurisdictions recognize the mortgagor's right of redemption in equity, which exists until the date of sale and is cut off by foreclosure. A mortgagor may purchase the land at the foreclosure sale, but a statutory right of redemption provides a grace period after foreclosure when the mortgagor may redeem the property.

O conveys Blackacre to A on Monday. O conveys Blackacre to B on Tuesday. A records on Wednesday. B records on Thursday. If both parties paid valuable consideration for the land, and neither knew of the other's deed, who owns Blackacre? response - correct A A, under every recording act B B, under every recording act C B, under a notice statute D B, under a race or race-notice statute

C B, under a notice statute If both parties paid valuable consideration for the land, and neither knew of the other's deed, B owns Blackacre under a notice statute. A notice statute is a recording act that alters the common law rule of "first in time, first in right" to protect a subsequent bona fide purchaser ("BFP")— i.e., one who pays valuable consideration and lacks notice of the prior conveyance. A notice statute requires only that the subsequent purchaser have no actual or constructive (i.e., record or inquiry) notice at the time of the conveyance. While a prior grantee can prevent the existence of a subsequent BFP by recording, a BFP will be protected under a notice statute even if she does not record. Here, B prevails over A under a notice statute because B had no notice of the O-A conveyance at the time of her conveyance from O. B would not own Blackacre under a race or race-notice statute (and thus not under every recording act). Under a race statute, the first party to record wins, regardless of whether she has notice of a prior conveyance. Under a race-notice statute, a subsequent BFP prevails over a prior grantee only if she records before the prior grantee. Here, A prevails over B under these acts because B did not record first. Because B prevails over A under a notice statute, A does not own Blackacre under every recording act.

Which of the following does not charge a purchaser of realty with inquiry notice? response - incorrect A The absence of his grantor's deed from the chain of title. B His deed's reference to an unrecorded instrument. C His grantor's use of a quitclaim deed. D The presence of a third party on the property.

C His grantor's use of a quitclaim deed. His grantor's use of a quitclaim deed does not charge a purchaser of realty with inquiry notice. Inquiry notice means that a subsequent grantee is held to have knowledge of any facts that a reasonable inquiry would have revealed, even if he made no inquiry. A quitclaim deed releases whatever interest a grantor might have in the property and contains no covenants for title. Nonetheless, in the majority of states, grantees are not charged with inquiry notice from the mere fact that a quitclaim deed was used. The presence of a third party on the property charges a purchaser of realty with inquiry notice. A title search is not complete without an examination of the property. A purchaser is charged with knowledge of whatever an inspection of the property would have disclosed and with anything that would have been disclosed through an inquiry of the possessor. His deed's reference to an unrecorded instrument charges a purchaser of realty with inquiry notice. If a recorded instrument makes reference to an unrecorded transaction, the grantee is bound to inquire of the nature and character of the unrecorded transaction. The absence of his grantor's deed from the chain of title charges a purchaser of realty with inquiry notice. When a grantor's title documents are unrecorded, the grantee is required, at his peril, to insist on seeing the deed and requiring it to be recorded.

An owner obtained a loan of $60,000 from a bank in exchange for a promissory note secured by a mortgage on his land, which the bank promptly and properly recorded. A few months later, the owner obtained another loan of $60,000 from a lender, in exchange for a promissory note secured by a mortgage on the land, which the lender promptly and properly recorded. Subsequently, the owner sold the land to a buyer for $150,000 and conveyed a warranty deed. The buyer expressly agreed with the owner to assume both mortgages, with the consent of the bank and the lender. A few years later, the bank loaned the buyer an additional $50,000 in exchange for an increase in the interest rate and principal amount of its mortgage on the land. At that time, the balance on the original loan from the bank was $50,000. Shortly thereafter, the buyer stopped making payments on both mortgages and disappeared. After proper notice to all appropriate parties, the bank instituted a foreclosure action on its mortgage, and purchased the property at the foreclosure sale. At that time the principal balance on the lender's mortgage loan was $50,000. After fees and expenses, the proceeds from the foreclosure sale totaled $80,000. Assuming that the jurisdiction permits deficiency judgments, which of the following statements is most accurate? response - incorrect A The bank keeps the entire $80,000 and can proceed personally against the owner for its deficiency, while the lender's mortgage remains on the land. B The bank keeps the entire $80,000, the lender's mortgage on the land is extinguished, and both the bank and the lender can proceed personally against the owner for their deficiencies. C The bank keeps $50,000, the lender is entitled to $30,000, and only the lender can proceed personally against the owner for its deficiency. D The bank keeps $50,000, the lender is entitled to $30,000, and neither the bank nor the lender can proceed personally against the owner for their deficiencies.

C The bank keeps $50,000, the lender is entitled to $30,000, and only the lender can proceed personally against the owner for its deficiency. The bank's original mortgage has priority in the proceeds, followed by the lender's mortgage, and only the lender can proceed against the owner because the bank modified its mortgage after the owner had transferred to the buyer. Generally, the priority of a mortgage is determined by the time it was placed on the property, and the proceeds of a foreclosure sale will be used to pay off the mortgages in the order of their priority. However, if the landowner enters into a modification agreement with the senior mortgagee, raising its interest rate or otherwise making the agreement more burdensome, the junior mortgage will be given priority over the modification. Thus, if the first mortgage debt is larger because of the modification, the second mortgage gains priority over the increase in the debt. Here, the bank and the buyer modified the original mortgage by increasing the principal amount and the interest rate. This modification is not given priority over the lender's mortgage, and foreclosure proceeds will not be applied against it because the senior lender's mortgage was not fully satisfied from the proceeds. With regard to the deficiency, the owner is liable to the lender because when a grantee signs an assumption agreement, becoming primarily liable to the lender, the original mortgagor remains secondarily liable on the promissory note as a surety. Here, the buyer assumed the lender's mortgage and became primarily liable; however, the owner remained secondarily liable as surety and can be required to pay off the rest of the lender's mortgage loan. On the other hand, the owner will not be liable to pay off the balance of the bank's loan, because when a mortgagee and an assuming grantee subsequently modify the original obligation, the original mortgagor is completely discharged of liability. The owner had nothing to do with the modification agreed to by the bank and the buyer that increased the amount of the mortgage debt, and will not be even secondarily liable for that amount. (A) and (B) are incorrect because the bank is not entitled to the entire $80,000 in proceeds from the sale and because the owner is not liable to the bank for more than the original loan amount. (D) is incorrect because, as discussed above, the owner is secondarily liable to the lender for the $20,000 deficiency on its mortgage.

Which correctly states the order of priority for allocating mortgage foreclosure sale proceeds, from first to last? response - incorrect A The foreclosing party, any senior lienors in the order of their priority, and then the mortgagor B The foreclosing party, any senior lienors in the order of their priority, and then any junior lienors in the order of their priority C The foreclosing party, any junior lienors in the order of their priority, and then the mortgagor D Any senior lienors in the order of their priority, the foreclosing party, and then any junior lienors in the order of their priority

C The foreclosing party, any junior lienors in the order of their priority, and then the mortgagor The order of priority for allocating mortgage foreclosure sale proceeds is as follows, from first to last: 1. Expenses of the sale, including attorneys' fees, and court costs; 2. The principal and accrued interest on the foreclosing party's loan; 3. Any junior lienors in the order of their priority; and then 4. The mortgagor. In many cases, no surplus remains after the principal debt is paid off. Senior lienors receive none of the proceeds. Because a senior lien remains on the property (i.e., may itself be foreclosed in the future), a senior lienor is not entitled to any of the money from the sale, even if there is a surplus.

Statutory redemption is the right of a mortgagor to recover the land after the foreclosure sale has occurred, usually by paying __________. response - correct A The full balance of the mortgage B The amount overdue on the mortgage, plus interest C The foreclosure sale price D The amount of the original debt

C The foreclosure sale price Statutory redemption is the right of a mortgagor to recover the land after the foreclosure sale has occurred, usually by paying the foreclosure sale price. About half the states provide a statutory right to redeem for some fixed period after the foreclosure sale has occurred, usually six months or one year. The amount to be paid is generally the foreclosure sale price, rather than the amount of the original debt. This right extends to mortgagors and, in some states, to junior lienors. In contrast, equitable redemption is the right of a mortgagor to recover the land by paying the amount overdue on the mortgage, plus interest, at any time before the foreclosure sale. If the mortgagor has defaulted and the mortgage or note contained an acceleration clause, then the full balance of the mortgage must be paid in order to redeem in equity.

A buyer purchased a parcel of land from a seller for $500,000. The buyer financed the purchase by obtaining a loan from the seller for $300,000 in exchange for a mortgage on the land. The seller promptly and properly recorded his mortgage. Shortly thereafter, the buyer gave a mortgage on the land to a creditor to satisfy a preexisting debt of $100,000 owed to the creditor. The creditor also promptly and properly recorded its mortgage. Within a year, the buyer stopped making payments on both mortgages, and the seller brought an action to foreclose on his mortgage. The creditor was not included as a party to the foreclosure action. The seller purchased the property at a public foreclosure sale in satisfaction of the loan. The creditor subsequently discovered the sale and informed the seller that it was not valid. Who has title to the land? response - correct A The seller, because he gave a purchase money mortgage and the creditor's mortgage was for a preexisting debt. B The seller, because the public foreclosure sale extinguished the creditor's interest. C The seller, but he must redeem the creditor's mortgage to avoid foreclosure. D The buyer, because the seller's foreclosure action was invalid without the inclusion of the creditor as a necessary party.

C The seller, but he must redeem the creditor's mortgage to avoid foreclosure. The seller has title to the land, but he must redeem the creditor's mortgage to avoid foreclosure. As a general rule, the priority of a mortgage is determined by the time it was placed on the property. When a mortgage is foreclosed, the purchaser at the sale will take title as it existed when the mortgage was placed on the property. Thus, foreclosure will terminate interests junior to the mortgage being foreclosed but will not affect senior interests. However, if a lien senior to that of a mortgagee is in default, the junior mortgagee has the right to pay it off (i.e., redeem it) to avoid being wiped out by its foreclosure. Thus, those persons with interests subordinate to those of the foreclosing party are necessary parties to the foreclosure action. Failure to include a necessary party results in the preservation of that party's interest despite foreclosure and sale. Hence, the seller's failure to include the creditor as a party to the foreclosure action preserved the creditor's mortgage on the property. To avoid the creditor's foreclosing (because the buyer was in default of the creditor's mortgage as well), the seller will need to pay off the creditor's mortgage. (A) is wrong because it is irrelevant. While a purchase money mortgage ("PMM"), given when the mortgagor buys the property, is considered to have priority over non-PMM mortgages executed at about the same time, even if the other mortgages are recorded first, that rule is not applicable here because the facts indicate that the seller's PMM was executed and recorded before the creditor's mortgage came into existence. (B) is wrong because the creditor was not included as a party to the foreclosure action. Thus, as discussed above, its interest is not extinguished by the seller's foreclosure action. (D) is wrong because the failure to include the creditor in the foreclosure action does not invalidate the action, it just preserves the creditor's junior mortgage on the property.

Must a junior mortgagee be named as a party to a senior mortgagee's foreclosure action? response - incorrect A No, because foreclosure does not affect interests junior to the mortgage being foreclosed B No, because foreclosure extinguishes interests junior to the mortgage being foreclosed C Yes, because it has the right to pay off the senior mortgage to avoid being wiped out by foreclosure D Yes, because all those with liens on the property are necessary parties to a foreclosure action

C Yes, because it has the right to pay off the senior mortgage to avoid being wiped out by foreclosure Yes, a junior mortgagee must be named as a party to a senior mortgagee's foreclosure action because it has the right to pay off the senior mortgage to avoid being wiped out by foreclosure. Foreclosure destroys interests ( e.g., liens, mortgages, leases, easements) junior to the mortgage being foreclosed. Thus, if a senior mortgage is in default, a junior mortgagee has the right to pay it off (i.e., redeem it) to avoid being wiped out by its foreclosure. Failure to join the junior mortgagee results in the preservation of its interest despite foreclosure and sale. In contrast, those with interests senior to that of the foreclosing party are not necessary parties because their interests are not affected by foreclosure. The buyer at the sale takes subject to senior interests, which remain on the land. As explained above, NOT all those with liens on the property are necessary parties to a foreclosure action. Only those with interests subordinate to that of the foreclosing party must be named in the foreclosure action. Failure to name a senior interest holder does not affect that party's interest. Because foreclosure extinguishes interests junior to the mortgage being foreclosed, as explained above, junior mortgagees are necessary parties to a senior mortgagee's foreclosure action. Foreclosure DOES affect interests junior to the mortgage being foreclosed. As explained above, junior mortgages are extinguished by foreclosure unless they are joined in the action.

A recording act that provides: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded," is a __________. response - correct A statute of frauds B race statute C notice statute D race-notice statute

C notice statute A recording act that provides: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded," is a notice statute. Under a notice statute, a later purchaser of land will prevail over an earlier grantee if she takes without actual or constructive (e.g., record) notice of the earlier grant. The above language is not a race-notice statute. An example of a race-notice statute is: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, whose conveyance is first recorded." Under a race-notice statute, a later purchaser will prevail over an earlier grantee only if she takes without actual or constructive (e.g., record) notice of the earlier grant and records before he does. The above language is not a pure race statute. An example of a pure race statute is: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser whose conveyance is first recorded." Under a race statute, notice is irrelevant. The first party to record, regardless of the date of her conveyance, wins. The Statute of Frauds is not a recording act. Every conveyance of an interest in land with a duration long enough to bring into play a particular state's Statute of Frauds (typically one year) must be evidenced by a writing, signed by the party to be charged.

An owner conveyed her property to a buyer, who put the deed in his suitcase and took off for a five-month tour of the world. The owner, knowing that the buyer had left the country, sold the property to an investor who was not aware of the previous transaction. The investor did not record her deed. When the buyer returned from his trip, he recorded his deed. A month later, the investor conveyed the property to a developer. The developer knew that the buyer held a deed to the property but completed the transaction anyway. Instead of recording, however, the developer immediately filed an appropriate action against the buyer and against the investor to determine ownership of the property. The property is situated in a jurisdiction containing the following statute: "Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice, unless the conveyance is recorded." How should the court rule? A. The buyer has rights superior to those of both the investor and the developer. B. The investor has rights superior to those of both the buyer and the developer. C. The developer has rights superior to those of both the buyer and the investor. D. The developer has rights superior to those of the investor, but the buyer has rights superior to those of the developer.

C. The court will rule that the developer has rights superior to those of the other parties. Under a notice statute, which is the statute applicable here, the general rule is that a subsequent bona fide purchaser ("BFP") will prevail over a prior grantee who failed to record before the BFP's purchase; if the prior grantee has previously recorded, the subsequent purchaser ordinarily will be deemed to have record notice of the prior conveyance and will not be a BFP. Under the shelter rule, a person who takes from a BFP will prevail against any interest that the transferor-BFP would have prevailed against.

A landowner in fee simple signed a promissory note for $10,000 to a bank, and secured the note by a mortgage of her land to the bank. The mortgage was duly recorded. The landowner then sold the property to an attorney, who assumed and agreed to pay the mortgage to the bank on the land. The attorney did not make payments on the mortgage note to the bank. The bank, following appropriate statutory procedures, foreclosed the mortgage and gave notice to both the landowner and the attorney that it intended to sue for any deficiency. At the foreclosure sale, the property sold for $6,000. The bank now sues both the landowner and the attorney for $5,000, which is the remaining amount of the unpaid principal and interest on the note plus costs of foreclosure. Against which party will the bank be successful in obtaining a judgment? response - correct A Only the landowner. B Only the attorney. C Either the landowner or the attorney. D Both the landowner and the attorney.

D Both the landowner and the attorney. The bank will be successful in obtaining a judgment against both the landowner and the attorney, although it may only collect once. When a grantee assumes the mortgage, the grantee expressly promises the grantor-mortgagor that he will pay the mortgage obligation as it becomes due. The mortgagee then becomes a third-party beneficiary of the grantee's promise to pay and can sue the grantee directly if the grantee fails to pay. After the assumption, the grantor-mortgagor becomes a surety who is secondarily liable to the mortgagee on the note if the grantee fails to pay. The landowner and the attorney are jointly liable, even though the attorney is primarily liable and the landowner is secondarily liable as a surety. Therefore, (A) and (B) are incorrect. (C) is incorrect. The bank is not required to choose between the landowner and the attorney and can obtain a judgment against both, although it may only collect once. Because the attorney assumed the mortgage obligation, the bank can sue the attorney, but it can also sue the landowner in the same action as a surety. The landowner and the attorney are jointly liable, even though the attorney is primarily liable and the landowner is secondarily liable as a surety.

To acquire a prescriptive easement on property, the claimant's use does not need to be __________. A continuous B adverse C exclusive D open and notorious

Exclusive use is not required in order to acquire a prescriptive easement. Acquiring a prescriptive easement is analogous to acquiring property by adverse possession, except that the use need not be exclusive (i.e., the user may share the use with the owner or other easement claimants). The use must be: 1. Open and notorious; 2. Adverse; and 3. Continuous and uninterrupted for the statutory period.

Owen (testator) = owner of Blackacre in fee simple Will: Leaves property to sister, Sarah (for life), w/remainder to the Children of his niece, Norah. At time of will: Norah children => Donna The next year: Norah => has Sam A year later, Owen dies. Shortly after: Donna dies --> leaves estate to husband (gift), Harold 1 year later: Norah => has Debbi Shortly thereafter: Sarah (Life Tenant) dies 16 months after Sarah's death: Norah => has Sid Who owns Blackacre?

Harold, Sam, and Debbi take Blackacre in equal shares. - At Owens death, Norah had a Donna and Sam => making their interests at that time vested remainders if fee simple SUBJECT TO OPEN (to make room for any future child of Norah.) - When Donna died => her vested remainder transferred to Harold. - When Debbi was born, she joined Sam and Harold => all three holding vested remainders in fee simple. - When Owens sister, Sarah died => her life estate ended, giving the present possessory estate to those three holders of the future interest. --> Why is Sid left out? Because of the CLASS CLOSING RULE: whenever ANY MEMBER of the class is entitled to a DISTRIBUTION, the class closes and the distribution is made then. Any later arrivals to the class lose out entirely. Because Sam, Harold, and Debbi are eligible for a distribution, the amount the moment the life tenant (Sarah) died, they take, and Sid, not yet born, loses it. * EXAM TIP: NOTHING THAT HAPPENS AFTER THE LIFE TENANTS DEATH MATTERS.

If an easement is said to be surcharged, this means:

If an easement is said to be surcharged, this means the easement's legal scope was exceeded. The holder of an easement has the right to use another's land (i.e., the servient tenement), but has no right to possess the land. The scope of an easement is determined by the reasonable intent of the original parties, and when the scope has been specified, these specifics will govern. However, when an easement's scope has been set out only in general language, courts will interpret it to accommodate the holder's present and future reasonable needs. In either event, if the easement holder uses the easement in a way that exceeds its legal scope, the easement is surcharged. The servient landowner may enjoin the excess use and possibly sue for damages if the land has been harmed. However, the easement does NOT terminate by operation of law, nor does such use give the servient owner a power of termination.

If the buyer of land determines that the seller's title is unmarketable, the buyer: A May sue on the implied covenant of marketable title after closing B Must take title to the land "as is" C Must notify the seller and give a reasonable time to cure the defects D May sue for damages for breach as soon as the defect is discovered

If the buyer of land determines that the seller's title is unmarketable, the buyer must notify the seller and give a reasonable time to cure the defects. Every land sale contract contains an implied covenant that the seller will provide marketable title at closing. Marketable title is title reasonably free from doubt, which a reasonably prudent buyer would accept. While it need not be perfect title, it must not present the buyer with an unreasonable risk of litigation. Generally, this means an unencumbered fee simple with good record title. If the buyer of land determines that the seller's title is unmarketable, the buyer may NOT sue for damages for breach as soon as the defect is discovered. As stated above, he must notify the seller and give her reasonable time to cure, even if this requires extending the closing date, and even if time is of the essence. If the seller fails to cure the defects, then the buyer may rescind the contract, sue for damages for breach, get specific performance with abatement of the purchase price, or (in some jurisdictions) require the seller to quiet title. Thus, it is not required that the buyer take title to the land "as is." The buyer may NOT sue on the implied covenant of marketable title after closing. This covenant applies at the contract stage of a land sale transaction, before the closing (i.e., exchange of purchase price and deed). The closing extinguishes the contract, which is said to merge with the deed. Then, absent fraud, the seller is no longer liable on this implied covenant; the buyer must rely on any assurances made in the deed.

A father gave his daughter marketable title to a five-acre parcel of undeveloped land that adjoined 200 acres of uninhabited forest owned by a neighbor. When she visited her property with her father, he mistakenly pointed out the boundary line. She subsequently staked out the boundaries and built a log fence along what she thought was the boundary line. Approximately an acre of the neighbor's land was inside her fence. The daughter built a cabin and lived in it for 30 years until she had to sell the property for medical reasons. The daughter entered into a contract to sell the land. In accordance with the contract, the purchaser had a survey of the land done, which revealed the boundary discrepancy in the legal description. The purchaser contacted the neighbor, who said he knew nothing of the matter and did not consent to the daughter's placement of the fence on his property. The purchaser then refused to proceed with the purchase. The jurisdiction in which the parcel was located had a 20-year period of occupation to satisfy the requirements of adverse possession. If the daughter sues for specific performance of the land sale contract, will she prevail?

No, because the daughter's title to the land is not marketable. The daughter will not prevail because her title is not marketable. The daughter did satisfy all six requirements of adverse possession of the portion of the neighbor's property. She possessed it exclusively for more than the statutory period, her possession was continuous and adverse to the rights of the true owner, and her possession was visible for all to see. But, even though she did acquire title by adverse possession, that title is not marketable until a judicial action is taken to quiet title. The law does not require purchasers to have to go to court to clearly establish title. Because the daughter had not done this, the title she contracted to convey was not, in fact, marketable.

Several decades ago, a square tract of 640 acres was subdivided into lots, streets were constructed, and utilities were installed. As the developer sold off each of the lots, each lot's deed contained a restriction limiting the lots to residential use only. The deeds were all recorded. Over the years, houses were constructed on all of the lots. The property to the south, east, and west of the subdivision was initially forest, but gradually the city expanded to surround the development. Unfortunately, the city expansion was mostly industrial and some commercial property, but no residential property. The subdivision is now bounded on all sides by many industries that operate 24 hours a day. The combination of noise, dirt, fumes, and other pollution has made many of the houses in the subdivision unfit for residential use, yet each deed still stipulates "residential use only." Can the restriction be voided under the doctrine of changed neighborhood conditions?

No, the restriction cannot be voided unless the entire subdivision is so seriously affected by the pollution that enforcement of the restriction would be inequitable

Two neighbors build a joint driveway as a joint easement to get to a road. Neighbor1 decides to no longer use the easement. N1 then sold his land to Buyer who didn't use the easement for several yrs, then started parking his car on the entire driveway. Can N2 prevent Buyer from using the easement?

No. The buyer will prevail. The easement in this case is an easement by grant. => That easement was not used for five years, but there were NO: 1) Acts which would have terminated that easement by adverse possession, nor was there 2) A manifested intent to abandon. * EXAM TIP: DONT BE FOOLED BY VERY LONG PERIODS OF NONUSE IN THE FACTS. Make sure there is an ACT showing an INTENT TO ABANDON => OTHERWISE, THERE CAN BE NO TERMINATION. ----> The easement was not terminated by MERE NON-USE, and the buyer will prevail as the successor to the easement granted to the woman.

Fifty-one years ago, an owner conveyed land to a taker for "so long as the land is used solely for residential purposes; otherwise, the interest in land shall revert to the owner and his heirs." The taker used the land as her personal residence for 20 years, but 31 years ago, she began operating a children's day camp on the land. The owner knew of this operation, but he took no action.Two years ago, the aged taker decided to get out of the camp business. She closed her business and once again began to use the land solely as her personal residence. Also two years ago, the owner died, survived by his son and only heir. Now the son is laying claim to the conveyed land. The jurisdiction in which the land is located has a seven-year adverse possession statute and another statute that bars enforcement of possibilities of reverter 55 years after their creation.May the son validly claim title to the land? A Yes, because less than 55 years have elapsed since the creation of the possibility of reverter. B Yes, because the adverse possession period began to run when the taker returned the property to residential status, and the taker has not held for the requisite seven years. C No, because the adverse possession period began 31 years ago, and the taker has held the property for more than the requisite seven years. D No, because the owner did not assert his possibility of reverter; thus, no cause of action arose in the owner or his heirs.

On the happening of the prohibited event (using the land for other than residential purposes), the taker's fee simple determinable automatically came to an end, and the owner was entitled to present possession. Not having claimed possession within the applicable seven-year period, and with the taker's possession being open, notorious, continuous, and adverse, any action by the owner or his heirs is now barred by adverse possession. Thus, (A) and (B) are incorrect. (D) is incorrect because a possibility of reverter becomes possessory automatically upon termination of the prior determinable estate. Unlike a right of entry, a grantor does not have to assert a possibility of reverter in order for a cause of action to arise.

A landowner and her neighbor owned adjacent parcels of land. The landowner hired a contractor to install an in-ground swimming pool on her land. The day after the contractor had excavated for the pool, the neighbor's storage shed, located on his property a few feet from the edge of the excavation, collapsed when the ground shifted. A riding tractor and patio furniture contained within the shed were damaged. The neighbor sued the landowner for damages. At trial, the neighbor established that the landowner's project caused the subsidence and the damage to his property. What else must the neighbor establish to prevail?

That his land would have been damaged without the storage shed or that the contractor was negligent.

A buyer purchased a tract home in a new development, putting up 10% of the purchase price as a down payment and financing the rest through a mortgage with a bank. After four years, the buyer put her house on the market, continuing to make all mortgage payments promptly. The buyer eventually sold the house to a third party, who took subject to the mortgage. After the third party took possession, the bank received no further mortgage payments from either the buyer or the third party. In most states, which of the following best describes the remedy or remedies available to the bank?

The bank may foreclose on the land, or it may sue the buyer on the underlying debt.

Can a person w/ future interest in land stop trees from being cut, a house from being torn down and a gravel pit from expanding on the land?

The charity can stop only the tree cutting. The charity would be suing the life tenant on a theory of waste. Both the gravel mining and the tree cutting could be voluntary waste. RULE: A life tenant can only MAINTAIN the property not --> He CANNOT SELL off any of the natural resources, such as trees and gravel. *Exception: EXISTING exploitation of these resources. => Because the gravel mine was operating prior to the sons taking of the life estate, that preexisting use is protected and the son is not liable for continuing the mining of the gravel. => The trees do not fall under this exception. The property had not been in use as a tree farm => Thus, cutting of the trees would be a waste. => The destruction of the house: Might be considered Ameliorative Waste => the destruction of improvements on the life estate that increase the value of property (ie. they make the gravel mining more profitable.) --> Exception: Generally a life tenant cannot tear down improvements simply because the life tenant wants to make a more profitable use of the land, BUT an exception exists when changed conditions have made the destruction of the improvement reasonably necessary. Here the house was on the edge of the pit, vacant because of its poor condition. Changed conditions (the enroachment of the pit) have made the house reasonably unsuitable, so the life tenant can tear it down.

Whether an animal shelter, who obtained the land from a woman (then to husband ---> daughter): warranty deed stated, "to animal shelter, so long as the premises are used for animal shelter purposes."

The daughter has title to the land because it is no longer used for animal shelter purposes. A fee simple determinable is an estate that automatically terminates on the happening of a stated event and goes back to the grantor. The interest that is left in a grantor who conveys a fee simple determinable is a possibility of reverter, which in almost all jurisdictions is transferable, devisable, and descendable. Here, the animal shelter has a fee simple subject to automatic termination if the land is no longer used for animal shelter purposes. The landowners possibility of reverter descended on her death of the husband , who subsequently transferred it by inter vivos conveyance to his daughter. Thus when the land ceased to be used for animal shelter purposes, it automatically reverted to the daughter.

A small brewer leased a commercial building from a landlord for a period of five years. The brewer installed tanks, pipes, and other equipment for his brewing operations and began operations. Two years later, the landlord mortgaged the property to a bank to secure a loan. The landlord informed the bank that the building was currently leased to the brewer. The bank recorded its mortgage but the brewer was not informed of the mortgage. Six months before the lease term was up, the landlord defaulted on the loan. The bank foreclosed on the mortgage and acquired title to the property. When the brewer began removing his equipment from the building shortly before the end of the lease term, the bank sought an injunction to prevent him from doing so. If the court denies the bank's injunction, what will be the likely explanation?

The equipment was installed for the brewer's commercial use and he did not intend for it to stay.

Husband & Wife = joint tenants w/ right of survivorship - They convey 10% interest to daughter - They convey another 10% interest to daughter's husband How is the land interest divided now?

The husband and wife => 80% interest as joint tenants The daughter (10%) and her spouse (10%) interest as tenants in common. When the husband and wife conveyed 10% to their daughter: Each retained 45% as joint tenants with one another, BUT the daughter's 10% is, by severance, a tenancy in common. * Because BOTH the husband and the wife JOINED in conveyance to their daughter, THEIR INTEREST REMAIN undisturbed as joint tenants. Same thing, when they BOTH conveyed 10% to the daughters spouse, who, by severance, is a tenancy in common.

Land Owner conveys land: "to my best friend, and upon her death, to my daughter." --> The BF conveys her interest in land => longtime neighbor. - What interest does the neighbor and daughter each have? - Who has to pay the taxes?

The neighbor => has a life estate for the life of the friend AND must pay taxes. --> When the best friend transferred her life estate to the neighbor, he took an estate that will terminate when the best friend dies. ---> The Rule: The LIFE tenant is responsible for paying taxes on the property (had there been a mortgage, the life tenant would HAVE to pay the interest on the mortgage but NOT the principal). ==> The life tenant can also transfer the property freely & the holder of future interest has no say in the matter. -->Holders of future interest, however, can take LE holder to court for UNDUE WASTE.

An abandoned place is rented by an elderly LL for 1 month for $400. When the tenants arrive, wife gets hurt bc of a rotted staircase. Is the LL liable to her?

The owner is liable to the wife. Landlords are liable for latent defects EVEN IF they NEITHER KNEW NOR SHOULD HAVE KNOWN of the defect IF the lease is: a) for a SHORT TERM and b) the property is FURNISHED. * **This is an EXCEPTION to the General Rule: A landlord is NOT liable for LATENT DEFECTS UNLESS the landlord either KNEW or HAD REASON TO KNOW of the defects.

An owner of two abutting lots on a street deeded the north parcel to a buyer and inserted in the deed the following language: "Grantee, his heirs and assigns shall not plant any shrubbery within 10 feet of the boundary line." The buyer recorded. The buyer later deeded the north parcel to a friend and did not include the language about the shrubbery in the deed. The friend planted a row of shrubbery within five feet of the common boundary. If the owner sues the buyer's friend to require him to remove the shrubbery, what is the likely result?

The owner will prevail because there is a covenant running with the land

A buyer entered into a written contract with a seller to purchase his commercial property for $100,000. The contract did not specify the quality of title to be conveyed, and made no mention of easements or reservations. The closing was set for November 25, three months from the signing of the contract. Shortly thereafter, the buyer obtained a survey of the property, which revealed that the city had an easement for the public sidewalk that ran in front of the store. Because this actually enhanced the value of the property, the buyer did not mention it to the seller. Subsequently, the buyer found a better location for her business. On November 1, the buyer notified the seller that she no longer intended to purchase the property. The seller told her that he intended to hold her to her contract. At closing, the buyer refused to tender the purchase price, claiming that the seller's title is unmarketable and citing the sidewalk easement as proof of that fact. In a suit for specific performance, will the seller likely prevail? A Yes, because the contract did not specify the quality of title to be conveyed. B Yes, because the buyer was aware of the visible easement and it enhanced the value of the property. C No, because an easement not provided for in the contract renders title unmarketable. D No, because the buyer gave the seller sufficient notice of her change in plans and yet he made no effort to try to find another purchaser.

The seller will prevail in his suit for specific performance because the easement was visible, the buyer was aware of it at the time she entered into the contract (i.e., she knew a public sidewalk ran in front of the store), and the easement enhanced the value of the property. There is an implied covenant in every land sale contract that, at closing, the seller will provide the buyer with marketable title. Marketable title is title reasonably free from doubt, which generally means free from encumbrances and with good record title. Easements are generally considered encumbrances that render title unmarketable; so if an easement is not provided for in the contract, it usually renders the seller's title unmarketable. There is an exception, however. A majority of courts have held that a beneficial easement that was visible or known to the buyer does not constitute an encumbrance. In this case, the sidewalk was visible, known to the buyer, and beneficial to the property. Thus, the sidewalk easement does not impair the marketability of the seller's title. Therefore, the buyer's excuse for her nonperformance is not valid, and because land is involved, the seller can get specific performance of the contract for purchase of the property. (A) is wrong because, as noted above, the covenant that the seller will convey marketable title is implied in every land sale contract. So here, the fact that the contract did not specify the quality of title does not relieve the seller from providing marketable title. Thus, (A) reaches the correct result for the wrong reason. (C) is wrong because, as noted above, there is an exception to the general rule, stated in (C), for beneficial easements that are visible or known to the buyer. (D) is wrong because the buyer cannot escape the contract merely by giving notice of her intent to breach it. It apparently was a valid contract that can be enforced against her. Failure to mitigate damages might prevent the seller from recovering avoidable damages but would not negate the breach.

What happens when a tenant wrongfully holds over after the expiration of a lease: recourse of the landlord?

The tenancy will be month to month at 975 a month. When a tenant wrongfully holds over after the expiration of a lease, the landlord has two choices: either treat the tenant as a trespasser and sue for damages and possession or impose a new periodic tenancy on the hold-over tenant. If the landlord chooses, as this landlord has done here to impose the new periodic tenancy, most courts in residential situations would impose a month to month tenancy. While the rent (as well as other terms) of the tenancy will generally be the same as the old tenancy, there is an exception when the landlord has told the tenant of a future higher rent and that notification came BEFORE the expiration of the old lease. In that event, the landlord can impose the higher rent in the new periodic tenancy.

A buyer entered into a contract with a seller to purchase the seller's farm. The contract of sale referred to the farm as containing 250 acres. The agreed-on price was $1 million. Before the date on which escrow was to close, the buyer learned from a surveyor he had hired that the farm actually contained 248 acres. On the date the sale was to close, the buyer instructed the escrow agent to release all but $8,000 of the purchase money because he was not getting what he bargained for. The seller refused to proceed with the sale. The buyer brings an action for specific performance and also seeks an $8,000 reduction of the agreed-upon contract price. What will be the probable outcome of the litigation? A The seller will win, because the buyer refused to tender the contract price when the seller tendered substantially what the contract called for her to perform. B The seller will win, because both parties had seen the farm before the contract was formed. C The buyer will win, because he is not receiving what he bargained for under the contract. D The buyer will win, if the court finds that the $8,000 reduction in price is a fair reflection of the title defect.

This answer states the traditional rule where the amount of land in a land sale contract is less than as agreed. When a buyer has a remedy of specific performance in a land sale contract, a court of equity will order a seller to convey the title if the buyer tenders the purchase price. If the seller cannot provide marketable title under the terms of the contract, but the buyer wishes to proceed with the transaction, the buyer can usually get specific performance with an abatement of the purchase price in an amount reflecting the title defect. A defect as to the quantity of land conveyed is usually corrected by a pro rata abatement of the price. (D) states the factors that a court of equity will look for when deciding whether to grant specific performance with abatement. (A) is incorrect because the parties' contract did not merely refer to the farm as a named parcel of land; it recited that it contained 250 acres. Based on this recital, a court could readily conclude that the difference of two acres is a material change in the terms of the contract and that the seller's tender of 248 acres was not substantial performance. (B) is incorrect because viewing the property did not put the buyer on notice as to the discrepancy; the buyer is not required to visually calculate the amount of acreage a parcel of land contains. (C) is not as good an answer as (D) even though it is probably a true statement. Not only must the defect as to quantity be material, so that the buyer is not receiving what he bargained for, but the abatement amount must be appropriate and not an excessive reduction of the purchase price, as choice (D) states.

In a residential subdivision, will a commercial builder be bound by a residential-use restriction that was omitted from his deed? A Yes, if the builder is in horizontal privity with the developer. B No, because there is no written restrictive covenant in the deed to the builder's lot. C Yes, if the builder had inquiry notice of a common scheme for development. D No, unless the builder had actual notice of restrictive covenants in the deeds to other lots.

Yes, a commercial builder will be bound by the restriction if the builder had inquiry notice of a common scheme for development. An equitable servitude is a covenant (i.e., a promise to do or not do something on the land) that, regardless of whether it runs with the land at law, can be enforced in equity against assignees of the burdened land who have notice of it. Generally, equitable servitudes are created by covenants contained in a writing that satisfies the Statute of Frauds. However, in the absence of a writing, reciprocal negative servitudes may be implied if: 1. There is a common scheme for development (i.e., a plan existing at the time sales of the subdivision parcels began that all parcels be developed within the terms of the negative covenant); and 2. The grantee had actual, record, or inquiry notice of the covenant. Thus, the builder may be bound without actual notice of restrictive covenants in the deeds to other lots. In a residential subdivision, the builder would be on inquiry notice of a common scheme for development if the neighborhood appeared to conform to common restrictions. Thus, the builder would be bound by the residential-use restriction. Even though there is no written restrictive covenant in the deed to the builder's lot, the restriction may be enforced as a reciprocal negative servitude, discussed above. To be bound by the restriction, the builder need NOT be in horizontal privity with the developer. Horizontal privity requires that the original parties to a real covenant shared some interest in the land independent of the covenant at the time they entered it (e.g., as grantor and grantee). Horizontal privity is required to enforce the burden of a real covenant at law, but it is not required to enforce the burden of an equitable servitude.

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