Unit 4 - Interests in Real Estate

Dower & Curtesy

Provides that the non-owning spouse has a right to one half to one third interest in the real estate for the rest of their lives even if the owning spouse wills the estate to others. Most states (including WV) have abolished this.

Reversion/Reverter

Real estate goes back to the person who gave it.

Appurtenant Easement

TWO adjacent parcels of land where one owner uses an easement to cross the owner's property

*Reversionary Interest (Aka: Reverter)

The creator of the life estate may choose not to name a remainderman. In that case, ownership returns to the original owner upon the end of the life estate. This is considered a future interest.

Remainderman (Remainder Interest)

The creator of the life estate may name this person to whom the property will pass when the life estate ends. This is considered a future interest.

Encroachment

When a building, fence, or driveway illegally extends beyond the boundaries of the land of its owner or legal building lines. Once this exists for 10 or more years, it becomes an encumbrance by prescription.

Life Estate

A freehold estate limited in duration to either the life of the holder of the estate or the life of some other designated person or persons. Not inheritable as it passes to the future owner according to the provisions by which the life estate was created.

Homestead

A legal life estate in real estate occupied as the family home whereby the home is protected from most creditors during the occupant's lifetime (I.e. Charge accounts & personal loan debt) but not from mortgage, home equity line of credit or real estate tax debt. A homestead is a statutory right that a family has in its residence. Today, it is used for tax advantage for elderly or disabled or shelter against unsecured debt.

Lis Pendens

A notice filed in the public record of a pending legal action affecting the title to or possession of property. Trouble ahead.

Party Wall

An exterior wall of a building that straddles the boundary line between two lots, or , or it can be a shared partition wall between two connected properties. Shared and built with shared funds. Considered an appurtenant easement, each owner owns half of wall (and driveway).

Taxes on Real Estate

Annual real property taxes assessed by local and area governmental entities to support school districts, transportation districts and utility districts; taxes on profit realized by individuals and corporations on the sale of real property; and special fees that may be levied to finance special projects, such as road or utility installation.

Enabling Acts

By which the state's police power authority is passed on to the municipalities and counties.

Two Types of Life Estate

Conventional (voluntary) and Legal (involuntary)

Police Power

Every state has the power to enact legislation to preserve order, protect the public health and safety, and promote the general welfare of its citizens I.e. Enact environmental protection laws, zoning ordinances and building codes.

Uniform Probate Code

Gives a surviving spouse the right to an elective share on the death of the other spouse, if the surviving spouse is not satisfied with the decedent's disposition of the will.

Governmental Powers

PETE: Police power, Eminent domain, Taxation, Escheat

Lien

A charge against property that provides security for a debt or an obligation of the property owner (i.e. real estate taxes, mortgages, judgements, etc.)

Taxation

A charge on real estate to raise funds to finance the operation of governmental facilities and services.

Encumbrance

A claim, charge, or liability that attaches to real estate that could lessen the use or value of the land. Type of interest in real estate that does not rise to the level of ownership or possession, yet still gives an individual, business or other entity some degree of use or control of the property. These include: easements or licenses, which permit limited use of the property; private restrictions found in property deeds, which cannot impose an illegal requirement; liens, which give notice of a claim against the property; encroachments, which can result if a neighboring improvement extends over a property boundary. The best way to know if one exists: get a spot survey.

Fee Simple Determinable

A fee simple defeasible estate that may be inherited. This estate is qualified by special limitations (which is an occurrence or event). The language used to distinguish a special limitation - words such as "so long as" or "while" or "during" - is key to creating this special limitation. The former owner retains a possibility of reverter, which is an interest that can be transferred to someone else. If the limitation is violated, the holder of the possibility of reverter (or heir or successor) can reacquire full ownership with no need to bring legal action in court. The title is automatically transferred to the person who holds the possibility of reverter.

Pur Autre Vie

A life estate based on the life of someone other than the life tenant and ends at the death of the identified person. Means "for the life of another".

License

A personal privilege to enter the land of another for a specific purpose. No ownership, only temporary use right.

Deed Restriction

A private restriction in the deed that runs with the land and limits the use of the property by the current owner as well as future owners to whom the property is subsequently transferred. Usually done by developer or subdivider. Same as CC&R's.

Fee Simple Defeasible

A qualified fee estate that is subject to the occurrence of some specific event (stipulations). Two categories of this: fee simple determinable and fee simple subject to a condition subsequent. These are considered a future interest.

Estate in Land

A term used to describe owning a type of real estate immediately or in the future. The degree, quantity, nature, and extent of an owner's interest in real property. It allows possession, meaning the holding and enjoyment of the property either now or in the future, and must be measured according to time.

Fee Simple Estate

Also known as fee simple absolute, is the highest level of real estate ownership recognized by law. Fee simple ownership is ownership in which the holder is entitled to all rights to the property by law. This estate is intended to run forever. Upon the death of the owner of a fee simple estate, the property interest passes to: the decedent's co-owner, if there is one and the co-ownership was accompanied by a right of survivorship; the person or persons specified in the decedent's will (the devisee); or if the decedent has left no will, to the person or person's designated by the state's law of interstate succession. The right to use a fee simple estate is limited only by public and private restrictions, such as zoning laws and restrictive covenants.

Inverse Condemnation

An action brought by a property owner seeking just compensation for land adjacent to land used for a public purpose when the property's use and value have been diminished.

Easement by Necessity

An appurtenant easement that is created when an owner sells a parcel of land that has no legal access to a street or public way except over the seller's remaining land. They can not be landlocked.

Easement in Gross

An individual or company interest in or right to use someone else's land (Utilities...sewer, well, phone, gas, electric, power lines, etc.).

Fee Simple Subject to a Condition Subsequent

An owner gives real estate "on condition of" ownership, which means there is a difference in the way the estate will terminate if there is a violation of the condition. With this, the estate does not automatically terminate upon violation of the condition of ownership. The owner (or the owner's heir or successor) has the right of reentry but must bring a legal action in court to assert this right.

Easement Appurtenance

Attached to the ownership of real estate and allows the owner of that property the use of the neighbor's land. The land must be owned by two different parties for this to exist.

Conventional Life Estate

Created intentionally by the owner to be given to someone for their lifetime as a life tenant with the full enjoyment of ownership.

Easement by Prescription

If the claimant has made use of another's land for a certain period of time as defined by state law (generally 10 to 21 years. WV 10 years). The claimants use must have been continuous, nonexclusive, and without the owner' permission (hostile). The use must be visible, open, notorious and the owner must have been able to learn of it.

Future Interest

In the defeasible fee estates, the possibility of reverter (fee simple determinable) or right of entry (fee simple subject to a condition subsequent) will only be possible at some time in the future, and may never take effect. Each of those rights thus is considered this:

Leasehold Estate

Is one for which the length of time of the property's use can be determined (i.e. leasing/renting a property). Also commonly referred to as a nonfreehold estate

Freehold Estate

Lasts for an indeterminable length of time, such as for a lifetime or forever (can be a FEE SIMPLE ESTATE that continues for an indefinite period and may be passed along to the owner's heirs, or a LIFE ESTATE, that is held only for the lifetime of a person (who may not be the holder of the life estate) and ends when that individual dies.

Successors in Interest

Needed to tack on one person's possessions to that of another (i.e. a deceased individual and the deceased's heir, a landlord and a tenant, or a seller and a buyer.)

Legal Life Estate

Not created by a property owner, but rather is established by state law. It becomes effective automatically when certain events occur (i.e. Dower, courtesy & homestead). Can't will property away but enjoy the whole bundle of rights.

Tacking

Provides that successive periods of continuous occupation by different parties may be combined to reach the required total number of years necessary to establish a claim for a prescriptive easement.

Fee Simple Absolute

The highest level of ownership, complete ownership. Same as: fee simple, fee estate, absolute fee simple, fee simple estate, freehold estate

Life Tenant

The holder of a life estate who is entitled to the rights of ownership and can benefit from both possession and ordinary use, and profits arising from ownership, just as if the individual were a fee simple owner. The life tenant's ownership may be sold, mortgaged, or leased, but it is always subject to the finite limitation of the life estate.

Courtesy

The life estate of a husband in the real estate of his deceased wife.

Dower

The life estate of a wife in the real estate of her deceased husband.

Servient Tenement

The parcel over which the appurtenant easement runs. Serving the neighbor by allowing the easement. The use of another person's land for your purpose.

Dominant Tenement

The parcel that benefits from the appurtenant easement. Has use of the neighbor's property.

Easement by Condemnation

The process (the act) by which the government exercises the right of eminent domain (when it is acquired for public use).

Escheat

The process by which the state may acquire privately owned real or personal property (I.e. When an owner dies and leaves no heirs and there is no will or living trust instrument that directs how the real estate is to be distributed.)

Interest & Effect

The right intention but the act is wrong (I.e. Steering)

Eminent Domain

The right of government to acquire privately owned real estate for public use.

Easement

The right to use the land of another for a particular purpose and may exist in any portion of the real estate, including airspace above or right-of-way across the land. It is created by written agreement between the parties. The creation of this always involves two separate parties.

Terminating an Easement

This can happen when the need no longer exists, when the owner of either the dominant or service to tenement becomes sole owner of both properties, by the release of the right of easement to the owner of the service to tenement, by the abandonment of the easement (the intention of the parties is the determining factor), or by the nonuse of the prescriptive easement. Certain legal steps may be required for this to happen.

Covenants, Conditions & Restrictions (CC&R's)

Used by a subdivision developer to maintain specific standards in a subdivision (i.e. adherence to certain architectural or design specs). Same as deed restriction.

Taking

When the land is taken for the public's use through eminent domain, the owner must be compensated fairly.