Property Outline for Boyack

7/29/2019 Property Outline for Boyack

1/51

Property, Page 1

Table of Contents

Table of Contents ......................................................................... 1

THEORIES OF OWNERSHIP ............................................................. 4Labor Theory ....................................................................................... 4

TYPES OF PROPERTY RIGHTS ......................................................... 5Exclusion ............................................................................................ 5

LEASEHOLD ESTATES (NON-FREEHOLD ESTATES) ............................ 6Categories of Leasehold Estates (3 types of leases) .............................. 6

Term of Years Tenancy ....................................................................................... 6*Periodic Tenancy* ............................................................................................. 6

Tenancy at Will................................................................................................... 6Tenancy at Sufferance ........................................................................................ 6

CREATING LEASEHOLD ESTATES .................................................... 7

The Lease ........................................................................................... 7Lease v. License .................................................................................. 7Doctrines ............................................................................................ 7

Illegal lease doctrine ............................................................................................ 7Retaliatory eviction doctrine ................................................................................ 7Implied warrant of habitability ............................................................................ 7

Tenant Duties and Protections ............................................................. 8Landlords Duties and Protections ........................................................ 9Eviction .............................................................................................. 9

Actual Partial Eviction .......................................................................................... 9Constructive Eviction ........................................................................................... 9Eviction Remedies for tenants ............................................................................. 9

LL Tort Liability ................................................................................... 9

TRANSFER OF LEASEHOLD ESTATE ............................................... 10How parties are bound ....................................................................... 10Sublease ........................................................................................... 10Assignment ....................................................................................... 10How Courts Distinguish ...................................................................... 11

FREEHOLD ESTATES & INTERESTS ................................................ 12FUTURE ESTATES ............................................................................... 12VESTING ............................................................................................ 12DEFEASANCE ..................................................................................... 13

RULE AGAINST PERPETUITIES ...................................................... 14CONCURRENT INTERESTS ............................................................ 17

Ownership ......................................................................................... 17Types of Concurrent Interests ............................................................ 17

*Tenancy in Common* ...................................................................................... 17Joint Tenancy .................................................................................................... 17Tenancy by the Entirety .................................................................................... 18Joint Bank Accounts ........................................................................................... 18

Profits (Usufructus) and Maintenance ................................................. 18

1


2/51

Property, Page 2

Partition ........................................................................................... 18

MARITAL PROPERTY DIVISION ...................................................... 20

EASEMENTS ................................................................................ 21Affirmative vs. Negative Easements ................................................... 21Conservation Easements .................................................................... 22Appurtenant vs. In Gross .................................................................... 22Distinguishing licenses from easements ............................................. 22

REAL COVENANTS ....................................................................... 24Requirements for the Burden to Run ................................................................ 24Requirements for the Benefit to Run ................................................................. 24Enforcement v. Voiding ...................................................................................... 24

Termination of Real Covenants ......................................................................... 24

EQUITABLE SERVITUDES .............................................................. 26

COMMON INTEREST COMMUNITIES ............................................... 27Cooperatives (Co-Ops) ....................................................................... 27

Condominiums (Condos) ..................................................................... 27Community Associations (HOA, POA, PUD, COA) .................................. 27Governance Decisions ........................................................................ 27

NUISANCE .................................................................................. 29Nuisance or trespass? ........................................................................ 29Nuisance remedies ............................................................................ 30

EMINENT DOMAIN ...................................................................... 31. . . For Public Use . . . ................................................................... 31. . . Without Just Compensation ...................................................... 31

REGULATORY TAKINGS .............................................................. 32

Three Broad Categories ..................................................................... 32Title transfer ...................................................................................................... 32Trespassory takings ........................................................................................... 32Non trespassory takings: ................................................................................... 32

Per se regulatory takings ................................................................... 32

ZONING ...................................................................................... 33Elements of Zoning Ordinances .......................................................... 33

Zoning Amendments ......................................................................................... 34Euclidean Zoning ............................................................................... 34Zoning and Constitutional Framework ................................................ 34

WATER RIGHTS ........................................................................... 35

Public Trust Doctrine .................................................................. 35Navigable waters ............................................................................... 35Natural resources .............................................................................. 35Boundaries ........................................................................................ 35Groundwater, Oil, and Gas Reserves ................................................... 35Riparian Rights .................................................................................. 36

ENVIRONMENTALLY SENSITIVE LANDS .......................................... 38

STARTING OWNERSHIP CHAINS .................................................... 39

2


3/51

Property, Page 3

First in Time / Rule of Capture ............................................................ 39Accession .......................................................................................... 39Adverse Possession of Land ............................................................... 39

DEEDS & CONVEYANCES .............................................................. 41

FINANCING & THE RECORDING SYSTEM ........................................ 44

TRANSFERRING OWNERSHIP OF PERSONAL PROPERTY .................. 48Finders Doctrine ................................................................................ 48Gifts ................................................................................................. 48

TRANSFERRING POSSESSION/USE OF PERSONAL PROPERTY .......... 50Bailments .......................................................................................... 50

Deed Covenants NOT ON FINAL ................................................. 51

3


4/51

Property, Page 4

Property Law

THEORIES OF OWNERSHIP

Labor Theory

The labor theory posits that people are entitled to the property that is produced by their labor.Strong traces of this theory linger in American property law, sometimes mixed with firstoccupancy theory. There are several notable objections to this theory, one of which is that thetheory assumes an infinite supply of natural resources.

Utilitarianism: Traditional Theory

Under the traditional utilitarian theory, property exists to maximize the overall happiness orutility of all citizens. Accordingly, property rights are allocated and defined in the manner thatbest promotes the general welfare of society. This is the dominant theory underlying American

property law.

Utilitarianism: Law and Economics Approach

The law and economics approach incorporates economic principles into utilitarian theory. Thisview essentially assumes that human happiness can be measured in dollars. Under this view,private property exists to maximize the overall wealth of society. Critics question theassumption that social value can be appropriately measured only by examining ones willingnessto pay.

Personhood Theory

Personhood theory justifies private property as essential to the full development of theindividual. Under this approach, some items are seen as so closely connected to a personsemotional and psychological well-being that they virtually become part of the person, therebyjustifying broad property rights over such items.

4


5/51

Property, Page 5

TYPES OF PROPERTY RIGHTS

(Bundle of Sticks / Rights)Exclusion

The right to exclude is a property right that exists to

Preserve owner autonomy with respect to property,

Protect against unseen harm posed by property Protections of delicate parts of property

Protect privacy of owners

Promote peaceful relations by giving a legal alternative to self help.

Economic efficiency

Trespass: Strict liability, violation of the right to exclude. Various remedies for trespass

Damages

Equitable remedies. . . Especially key for permanent trespass (encroachment) andrepeated trespasses ADD SOMETHING HERE

Can be limited by (exceptions to exclusion):

Nuisance: two incompatible uses

Restatement test: balances the harm to find reasonable use.

First to start

neighborliness test

Coase theorem: most economically efficient solution.

Necessity

Life trumps property storms, acts of god, fleeing animal or assailant, etc.

Custom

Cost/Benefit Exceptions that arise from assembly costs of obtaining permission to

use land. (results in eminent domain or easements) Public accommodation

Places of public accommodation cannot have ad hoc exclusion, but mayhave rules for entry absent constitutional limits.

Fair housing laws

Unlawful to discriminate in advertising, sales, etc. on face, color, religion,sex, familial status, or national origin.

Exception for single-family homes for sale by owner, and when you livein one of up to 4 units in a building.

Use/Enjoy and Possession

The owner has a right to use and possess his land, which is limited by nuisance laws

Profits

The owner has a right to the profits derived from his property.

Transfer or Destroy

Owner has right to transfer land. Restrictions are few, but may be imposed by CL or statute.

Balancing test for free expression of property rights

Some courts: right to exclude more power, some: more public interest concerned.5


6/51

Property, Page 6

LEASEHOLD ESTATES (NON-FREEHOLD ESTATES)

In General

A leasehold estate is a legal interest that entitles the tenant to exclusive possession for either a

fixed time or at the will of the tenant (orlessee) and the landlord (orlessor).

Benefits:

Means of financing

Spreads the risk. Tenants dont have sunk costs in location; landowner is able toretake land from defaulting tenants

Permit specialization in parts of governance

Categories of Leasehold Estates (3 types of leases)

Term of Years Tenancy

Fixed period of years

Any term longer than a year must meet the SOF

No notice requirement to terminate because it is predetermined

*Periodic Tenancy*

Lasts for an initial fixed period, and automatically renewed

Landlord or tenant must give advanced notice terminates by ending renewal

Yearly leases require a six month notice

Tenancy at Will

Lasts as long as both parties want

Either party may terminate at will

At common law, no notice. Modern law requires notice equal to period of time atwhich rent payments are made.

Tenancy at Sufferance

What occurs when tenant no longer has rightful possession but is not ejected. The landlord is free to evict the tenant at any time, but must make a removal

action. Tenant offer of rent commences a periodic tenancy.

A lease for your whole life is a freehold tenancy. Non-freeholds must fit into 1-3above.Statutory Tenancies: rent control & co-ops different rules, protected bystatute.

6


7/51

Property, Page 7

CREATING LEASEHOLD ESTATES

The Lease

Contractual obligations

The lease is the heart of the landlord-tenant relationship. Almost all states have a Statute ofFrauds that requires a lease for a term of more than one year to be in writing, set forth the keylease terms, and be appropriately signed.

Covenants

Independent covenants are those independent of the other partys act. Remedy isin breach of contract.

Dependent covenants must only be fulfilled if corresponding duty is.

Lease v. LicenseTest: Courts look for intent of parties by interpretation & relationship

Default Rule (both): All party interests transferable but you can only transfer what you have

Lease (property right / interest

PLUS K)

Easement vs. in rem property

Exclusive possession (temporary)Use rightNon-revocable (ends at term end)Exclusive

Argue: rent, long, sublet or assignprovision, no property description,language tenant, LL, etc,uninterrupted possession

License (a K or less)

Personal

Use rightRevocableIf consideration or estoppel you can revoke

but you will have to pay K damagesOften non-exclusive

Argue: no description, personal, control keptw/owner

Doctrines

Illegal lease doctrine

A lease of property that violates one or more housing codes that renders the property unsafe andunsanitary voids the lease.

Retaliatory eviction doctrine

A landlord cannot engage in retaliatory eviction, where he evicts a tenant in retaliation forcomplaining about housing conditions or taking other action to correct such conditions.

Implied warrant of habitability

Applies to residential lease (usually not applied to commercial) and deems them to contain an

7


8/51

Property, Page 8

implied warranty that the premises are in habitable condition and landlord will maintain them inthat condition during the lease term. The tenant must notify landlord of defects and allow areasonable time for repairs. Cannot be waived.

Remedy for breach is to:

Move out, or

Remain in possession and:o (1) withhold rent (depending on jurisdiction may be allowed);

o (2) abate rent; or

Method 1: Reduce rent by a percentage equal to percentdevaluation of the property

Method 2: Reduce rent by the difference between the promisedrent and the actual value.

o (3) tenant repairs and deducts the cost from rent.

Tenant Duties and Protections

Duty to Pay Rent

Duty to pay rent is a dependent covenant based on the right to quiet enjoyment

Eviction releases duty to pay

Partial eviction only requires a partial payment.

Constructive eviction occurs when the landlord is notified of but does notameliorate a substantive, chronic interference with the tenants right toquiet enjoyment; sometimes required to vacate the premises to showconstructive eviction. If the landlord has a privity relationship to anotherindividual violating quiet enjoyment, the landlord must use leverage tomoderate the behavior of the other tenant.

The duty is extinguished upon release by the landlord, merger (where tenantacquires freehold), expiration of the lease, eminent domain, a breach of the rightto quiet enjoyment, frustration of purpose, and surrender.

The landlords remedies are SIR:

Surrender (accept the tenants offer to leave the lease). Tenant is liable forrent due up to the point of surrender.

Ignore the tenants abandonment and sue for damages, or

Re-enter and re-let for the tenants term (mitigation). Typicallyestablished through a clause. Differs from surrender in that an inability to

re-let despite good faith efforts holds the tenant liable for the lost rent.

Duty to Repair

The duty to repair is an independent covenant that requires the tenant to keep premises inreasonably good condition and avoid waste; remember, removal of a fixture is waste.Perversely, it remains even if the tenant has been evicted.

8


9/51

Property, Page 9

Landlords Duties and Protections

Duty to Deliver Vacant Possession

The landlord must deliver actual, legal possession of the vacant premises at the start of the lease.

Duty of Quiet Enjoyment

The landlord must not interfere with the tenants right to use and possession of the property byactual or constructive eviction. (This is a contract claim.)

Additional duties

The landlord must exercise reasonable care to prevent injuries from dangerous conditions.

Eviction

Actual Partial Eviction

Requires actual physical trespass locks on door, building structure over property, etc.

Dont need to show use & enjoyment impacted because obvious

Constructive Eviction

Use & enjoyment impacted so much that you cant use it

(often times) You must actually leave!o SNG substantial, notice & opportunity to cure, get out proves no use/enjoy

Interference in value: cut off electric, rodents, fumes, noise, etc.

If you leave: no rent, but if you dont could have to pay some of it

Eviction Remedies for tenants

Terminateo Vacate without further rent liability

Withhold rent (abatement some / all)o Pay partial rent for partial eviction

Cure & deduct costso Fix it yourself and get reimbursed by deducting from rent

Sue for K damages or specific performanceo Remain in possession & continue paying rent during suit

LL Tort Liability

Duty, Breach (failure to act reasonably after knowledge), Injury, Causation

LLs have duty of reasonable care

In some cases: Strict Liability if Injury & Causationo LLs should take care to avoid Least Cost Avoider

9


10/51

TRANSFER OF LEASEHOLD ESTATE

How parties are bound

Privity of contract Bind parties in contract with one another

Obligations are those found in the contract (here, the lease)

Privity of estate

Bind parties where As interests are directly carved out from Bs, and A isin actual possession of the land.

Obligations are those covenants that touch and concern the land and areintended to run. Safe to say they will include the same as landlord-tenant.

Both parties may sublease & assign by default: K must specify any constraints

Residential: courts tend to allow subjective denials by LLs

Commercial: courts use objective reasonableness requirement on LL

Sublease

A transfer of less than 100% of the tenant/sublessors interest to a sublessee.

Privity of contract between:

Tenant/subleasor and landlord because of the first lease

Tenant/subleasor and the sublessee because of the sublease

No privity of contract between the landlord and the sublessee.

Privity of estate between:

Tenant/subleasor and landlord because tenant/subleasor has retained some

amount of interest carved directly out from the landlords interest. Tenant/subleasor and sublessee because the sublease transferred some

portion of the tenant/subleasors interest.

No privity of estate between the landlord and the sublessee because the

sublessees interest is not carved directly out from the landlords.

Assignment

A transfer of 100% of the tenant/assignors interest to an assignee.

Privity of contract between:

Tenant/assignor and the assignee through the assignment contract

Tenant/assignor and the landlord through the lease.

No privity of contract between landlord and the assignee

Privity of estate between:

Landlord and the assignee because the assignees interest is directlycarved out of the landlords (tenant/assignor transferred everything)

No privity of estate between the tenant/assignor and landlord because theassignment transferred all of the tenant/assignors interest.

10


11/51

An assumption is an express agreement by which the assignee agrees to bebound by privity of contract with the landlord. It does not remove privity ofcontract between the tenant/assignor and landlord.

A novation is an agreement to erase any privity of contract between the

tenant/assignor and the landlord. It does not create privity of contract between theassignee and the landlord.

How Courts Distinguish

Language of lease / assignment

Where payment goes (subleasor or LL)

Entirety of rights & possession if subleasor retains anything sublease

11


12/51

FREEHOLD ESTATES & INTERESTS

FUTURE ESTATES

Checklist for determining defeasible:1. What the basis here: life estate or fee simple estate?

2. Who has the future interest? Grantor or Grantee3. If grantee - you can call it FS/EL - executory interest4. if its a grantor - is the language durational or conditional5. once you answer all those questions you can determine what interests you have in the

defeasible estates

Present Future Grantor (O) (A) Grantee (B)

FSAFee Simple Absolute

NO!!! NONE!!! NONE!!!

LELife Estate YES!!! (for sure,people willdefinitely die)

Reversion(Always Vested) Contingent Remainder

(Vested Remainders)

Id.VR

VR Subto Open

VR Sub toCompleteDivestment

FSD (durational /determinable)Fee Simple Determinable

Yes!!! (mayyybe) Possibility ofReverter(Always Vested)

Executory Interest (AlwaysContingent)

FS / SCS (if FI in O)Fee Simple Subject to

Condition Subsequent

Yes!!! (mayyybe) Right of Entry(voluntary taking)(Always Vested)

N/A

FS / EL (if FI in B) -FeeSimple Subject to

Executory Limitation

Yes!!! (mayyybe) N/A Executory Interest (AlwaysContingent)

VESTING

Remainder is vested ifboth:1. Ascertainable holder

a. Born must already be bornb. Identifiable must be able to tell who it is NOW

2. No condition precedent (nothing has to happen first)

VR Subject to Open:

One child (of A) is already born class is open, closes on As death.VR Subject to Complete Divestment:

You are vested but could lose before taking possession. (could die, or present holdercould violate limitation ie build a farm when hes not allowed)

12


13/51

Contingent remainders ALWAYS have an alternate path.

DEFEASANCE

Durational until, while, during, so long as; determinable or automaticConditional but if, provided, however, condition; terminable subject to condition subsequent

13


14/51

RULE AGAINST PERPETUITIES

ONLY APPLIES TO:

Executory Interest

Vested Subject to Open

Contingent Remainder

The rule

A future interest is void the moment it is created if:

It is in a grantee,

Is either contingent or subject to open, and

It might still exist and still be contingent or subject to open longer than 21years after the death of the last person alive at the time of the conveyance.

Application

1. Draw vertical lines to separate the different interests and identify the state of the titleaccording to the conveyance

2. Look for any future interests in a grantee3. Check future interests in grantees to see if they are contingent or open.4. Identify the necessary factual developments for vesting and closing.5. Circle all lives in being6. See if the interest mightstill be contingent or open longer than the lifetimes of everyone

circled plus 21 years. See if there is a validating life.7. If the contingent interest violates the rule, strike the whole interest and revise the

classification of the title.8. If there is another contingent or open interest in a grantee, repeat the process.

RAP danger signs

Beware if it is a conveyance or a devisement. Conveyance occur while alive, but devisements atdeath. Some classes (like children) could

The condition is not personal to someone

There is an identified age or time period of more than 21 yearsThe interest is given to a generation after the next generation

A holder must survive someone who is merely described rather than named. An identified event that need not happen well within 21 years.

Holder is unascertainable until the death of someone described but not named.

RAP in the 21st Century

Exemptions exist for charitable donations, but only if both the first grantee and the followinggrantee are charities. In addition, perpetual trusts (dynasty trusts) are increasingly common.

14


15/51

The RAP has been reformed to make the time period year based rather than lifetime based, or toinclude wait and see periods in which the RAP waits to see if the interest will vest rather thanrequiring that it must vest or fail within the live in existence + 21 years.

Cy Pres allows courts to reform the grant

o Fulfill intent of grantor Grant Saving Clauses

o People put in lists of names 4 people, entire NYC phone book, etc. cant find

out when all the people die

USRAP: Wait until interest vests & see if 90 years passed or if there is a validating life.o Not for commercialo Alaska has 1000 yr wait and see approacho Dynasty trusts: trust lasting generations for families exempt from RAP.

Restraints on Alienation

Public policy: when we grant someone a fee they are allowed to sell it.

L-T law: alienation has to be reasonable, non-discriminatory, duty to mitigate

What would be unreasonable?o Unreasonable duration, price (disproportionate for ex.), purpose (no legitimate

reason for it)

Courts may apply RAP or a balancing / reasonableness test

Doctrine of Waste

1. Commissive / Voluntary / Affirmative Wastea. You actually do something commit active waste.2. Permissive Waste:

a. Act of omissionb. Failure of duty reasonably maintain & preserve property (reasonable person

standard)3. Ameliorative Waste

a. Change in nature / character of land which drives property upb. Improving the property is this bad?

i. One persons improvement might not be an improvement to anotherii. I want my family home, not a townhouse community, even though it

might make me money hurts me not the propertyc. What about the person with LE? The present property holder?

Rule: Whether or not something is waste: depends on the context of whats happening in thecircumstances. Not just a solid line. (Melms v. Pabst) Test: Duty, Breach, Caused Damage

Recovery Options:1. Damages (decrease in value)2. Specific Performance (or injunction)3. Appoint Receiver

15


16/51

4. Terminate Possessory Interest

16


17/51

CONCURRENT INTERESTS

Ownership

In all concurrent interests every owner has the right to possess the whole, exclude strangers, usethe property for profits, partition, or sale. No owner can oust other co-tenants. All have duty tomaintain.

Types of Concurrent Interests

*Tenancy in Common*

Default form

Each tenant has a separate undivided interest

Undivided in that all have the right to possess the whole

May still have different sizes and types of interests

No survivorship: Each interest is descendible, conveyable, and devisable. Share of profits and costs relate to size of interest

Destroyable by partition.

Joint Tenancy

Requires the four unities

Acquired title at the same time

Acquired title by the same deed or will

Each interestmust be the same in type and size

Each tenant must have an equal right topossession.

Right of Survivorship: Notdescendible, devisable or alienable. Severance converts to a TIC. Sever (unilaterally or not) by:

Suit for partition

Sale

Conveyance to self through strawman

Lease

Only works in certain jurisdictions. 3 perspectives:1. Lease ends upon death of the leasing co-tenant2. Lease causes temporary severance of joint tenancy during

term of lease, but joint tenancy reforms after lease.3. Lease causes conditional severance. Ifeitherco-tenant dies

before lease term ends, joint tenancy becomes TIC, but if notthe joint tenancy remains.

Mortgage

Lien theory jurisdiction (majority): Mortgagee is considered tohave lien on the real estate to secure repayment of debt. Borrowercontinues to hold title, therefore, no severance.

Title theory jurisdiction (minority): Lender is considered to ownthe legal title but the borrower owns the equitable title and the rightto possession. Consequently, severance.

17


18/51

Fragile & can be destroyed by any part even w/o knowledge & permission.

Why do this?

Tax avoidance no estate tax upon death

Cheaper than writing a will

Not typically what homeowners want.

Tenancy by the Entirety

Joint tenancy plus unity of the person (marriage = one person)

Neither spouse can sever on their own.

Terminable by:

divorce,

the death of one spouse,

mutual agreement of the spouses (cannot unilaterally sever).

30 states have outlawed these and you end up with TiC if you try to create TbE.

Joint Bank Accounts

Treated as joint tenancies. Three reasons for having:

Agree to pool because of nature of relationship (marriage)

Create a will substitute so that money transfers to other party upon death

Assist dependent persons by allowing another to make withdrawals andpurchases for their assistance.

Each cotenant only entitled to an equal share (typically half) of account

Profits (Usufructus) and Maintenance

Ouster : concept not really a suit. Use that equals exclusion. Recover your shareof rent, but if not actually excluded, you wont get anything.

Suits for accounting recover an owners share of the profits. All owners have aright to the profits, in proportion to their ownership share, even if absent

Suits for contribution recover money owed for maintenance. The maintenancewas needed and notice was provided. All owners are obligated to pay formaintenance or improvements done with mutual agreement.

At partition, each co-owner will be credited/debited for the value of anyimprovements undertaken by him and the other owners.

Partition

Any cotenant can sue for partition without reason and court will grant

Partition in kind: literally cut the property into equal shares

Partition by sale: judicial sale of the property and distribution of proceeds

Offset: suing for contribution opens you up to suit for accounting even withoutouster.

18


19/51

Upside Down Doctrine: improvement, all share in value but dont have to payuntil you sell: then you get profits as result of improvement and dont have toshare extra profit.BUT if you waste / lower value: same applies difference charged to you.

19


20/51

MARITAL PROPERTY DIVISION

Theories of Property Ownership & Division

Common Law: his & hers + Tenancy by Entirety (if allowed in state) Community Property States: Separate & Community Property

o Separate: anything from before marriage, and gifts received separately (including

testamentary, descent, etc.)o Community: anything acquired by A or B during the marriage

o Proposals for separate to become community over time in marriage

Divorce Division of Property

CL: entitled to share property acquired together and/or to one of you during marriageo Equitable division

All property that either person has Reallocation of value

How do we divide? Ad Hoc / No Rule / Courts Discretion

Factors: contribution to marriage, duration of marriage, ability tokeep standard of living after marriage, fault (getting less common)

o Spousal Support

Alimony getting less common

Enforcement issues, changes over time, hard to divide, nice clean break

When do we still do it? Why?

Unable to pay upfront, preserve marriage sanctity, not bailing out

poor spouse but entitlement of other spouse Community Property States:

o Presume 50/50/ split of community property (CA is strict 50/50)

o (Spousal Support)

Death Division of Property

CL: cannot disinherit your spouseo Spousal share / Elective share allows spouse to select a certain percentage

or 1/3 of the estate usually of his/hers

floor not a ceiling if I leave all to X, spouse still gets -1/3

if you want to disinherit your spouse, do it when youre alive or divorce

Communityo 50% of community property

o 0% of separate (unless there is a will)

Professional license property? Only in NY.Cannot hold marital property outside marriage no community property, no TbE

Contract (will not imply due to anti-palimony statutes, only express Ks enforced)

Unjust Enrichment / Reimbursement / Promissory Estoppel

20


21/51

Property Structure: partition, give away to get rid of survivorship, cohabiting not enoughEASEMENTS

Easements are a type of servitude

An easement is a K (enforceable as a property right) in which an owner agrees to waive his rightto exclude certain kinds of intrusions by another. It is a contract approach to conflicting uses.

Classifications

Benefited land is dominant tenement, burdened land is the servient tenement. In addition,there are negative and affirmative easement, and easement appurtenants and easements in gross.

(Require) Deeds to easements (per SoF): 1) Writing 2) Delivery (intent, actual physical transfer,acceptance) 3) Notice Actual, Inspection (duty: you should see easements there), Record

BFPs can take title from merchants even if dont have good title

Recording Act: certain people w/o notice get good title if no way they could have known

Affirmative vs. Negative Easements

Affirmative Easements

The right to go onto and dosomething on serviant land.(e.g. rights of way, right tolay utility lines, right to putup a billboard)

Created by:Prescription:

The use is 1) open and notorious, 2)adverse and under a claim of right,and 3) continuous & uninterruptedfor the statutory period. Warsaw.

Implication:Implied by: 1) severance of title toland held in common; 2) anexisting, apparent, and continuous

use when severance occurs, and 3)reasonable necessity for the use attime of severance. (Probably onlyfor commercial. And, How Muchvery strictly interpreted.) Crane.

Necessity:Requires: 1) severance of title toland held in common; and 2) strictnecessity at the time of severance.Schwab.

Negative Easements

The right to compel the serviant owner torefrain from doing something otherwisepermissible on his land.

Only four categories:

LightAirSupportStream flow (artificial)

Must be created by grant.

Fontainebleau.

21


22/51

Grant: Must meet SOF.

Conservation Easements

Negative easements in gross Biggest growing area of easement law

Prevents certain land uses for: environment, to prevent too much comm. Development

Prohibit development after death dead hand give piece of mind to current owners.

Donate your interest & receive tax deduction express grant, heavily lawyered.

Objections: perpetual in nature, public funds, lack of oversight & flexibility

Enforcement: no oversight, should we allow private individuals to sue?

Appurtenant vs. In Gross

Appurtenant in rem (runs with land)

An easement appurtenantbenefits the easement holderin his capacity as owner ofthe dominant tenement.

Must have 2 parcels of landinvolved, and runs witheither of the parcels.

In Gross in personum

An easement in gross benefits the holder ina personal sense, whether or not he ownsparticular land. Rare to run with person.

Only need one parcel of land. If held forpersonal reasons it is non-transferable, butif it is held for commercial reasons may betransferred by writing (like RRs).

Profits

A profit (akaprofit a prendre) is right to enter the land of another and remove timber, minerals,gravel, game, or other physical substances.

Distinguishing licenses from easements

A license is not a property interest. It is a mere privilege to go onto another's land for somedelineate purpose. As such, they are not subject to the statute of frauds and may be revoked bythe grantor so long as the grantee does not rely upon it. If the grantee relies upon it, theredevelops an easement by estoppel. Reliance must include: 1) a license, 2) an expenditure ofsubstantial money or labor in good faith reliance; and 3) the licensors knowledge or reasonableexpectation that reliance will occur. Holbrook.

Scope of EasementsScope may evolve over time as the manner, frequency, and intensity of use change. Courts

look at language, context, & treatment to determine intent. Where, who, how, how much.

Termination of Easements

Terms of original grant

Deed of easement back

Merger of dominant & servient estates

AP / Adv. Prohibition of Use

Estoppel

Marketable Title Laws

Abandonment (holder stops using & clearly manifests intent to relinquish)

Conveyance of burdened land w/o notice to a BFP nothing in record

Third Party w/ Superior Rights (foreclosure on dominant land)

22


23/51

Impossibility (changed circ. / look to grant language, RARE earthquakes, etc.)

Misuse: considered trespass, follows tp remedies + possibility of injunction against using it

Goals of Drafting Easements

1. Easement: (not a fee) put in that language2. In Gross: only to C as long as C owns / limits to possession3. Scope: type of use, where, how much / how often4. Relocation: right to relocate to easement to another location which doesnt harm

easement holder within 2 days notice5. Not Exclusive6. Remedies: provisions & duration for termination, misuse & no longer need = termination7. Maintenance: who will handle it8. Holder not allowed to pave it

9. Holder must put in fence if dominant land holder requests10. Liable if cattle strays off easement

23


24/51

REAL COVENANTS

Covenants distinct from easements

Affirmative or negative promise concerning use of land. (Easement is a property interest.)

Covenant is a contract creature of law with damages as the remedy.

Creation of a Real CovenantLaw distinguishes between original parties & subsequent. Original covenant simply promise.

3 Step Analysis

Enforceable at all? Contracts question substantive.

Does it run? Benefit & burden where necessary (below)

Remedies available for covenant not being kepto Law: damages & injunction //// Equity: injunction only (no priv. req)

Requirements for the Burden to RunWITHVN (HP + VP)

Writing (SOF consideration)Intended to run with the burden (broadlyinterpreted)Touch and concern the land (relate to thedirect use or enjoyment)Horizontal privity and Vertical privity.

Horizontal privity: Privity of estatebetween the initial covenant makers.

(e.g., landlord/tenant). CL: exists ingrantor-grantee relationships.Neighbors do NOT have HP.Vertical privity: Ownership chain.

Notice to burdenedsuccessorNeponsit Property Owners

Assoc.

Requirements for the Benefit to RunWITV (VP)

Writing (same as above)Intent (same as above)Touch and concern the land (same asabove)Vertical privity (only vertical, nothorizontal)

Restatement / Modern - WIN

Writing: reasonable person looks at recordIntent: original K parties courts may inferbased on surrounding circumst., relianceNotice: not binding on BFP w/o it (Record, Actual, Constructive notice rules)TC & VP old rest. requires, new doesnt

Enforcement v. Voiding

Consent: questionable actual knowledge but deemed by purchase, terms often bundled &

non-negotiable, but no real alternatives as all properties in area have same covenants Public Policy: anti-competition must be rel to pub purpose, alienation & discrimination

Termination of Real Covenants

Covenants end upon abandonment, changed conditions, or merging.

Abandonment occurs when the conduct of the person entitled to the benefit of thecovenant demonstrates the intent to relinquish her rights.

Changed conditions occur when conditions in the area of the burdened land haveso substantially changed that the intended benefits of the covenant cannot be realized.

24


25/51

Merger occurs when same landowner owns both the benefited and the burdenedlands.

25


26/51

EQUITABLE SERVITUDES

What Is an Equitable Servitude?

It is a promise concerning the use of land that 1) benefits and burdens the original parties to thepromise and their successorsand that 2) is enforceable by injunction. It is a creature of equitywith an injunction as the remedy. Tulk.

Creation of an Equitable Servitude

Like a covenant, an equitable servitude is made by promise. For an equitable servitude to runwith the land, it must be WITN:

Writing (with covenants)Intent (with covenants)

Touch and concern the land (with covenants)Notice to burdened successor (applies to the burden, not the benefit)

Special Problem of Equitable Servitudes and the Subdivision

If a developer manifests a common plan orcommon scheme to impose uniform restrictions on asubdivision, most courts conclude that an equitable servitude will be implied in equity, even ifthe Statute of Frauds is not satisfied.

Restatement on Equitable Servitudes

The Restatement only requires intent and notice. It does not require a touch and concernelement because of freedom of contract. In addition, it sets these publicpolicy/unconstitutionality limits that servitudes cannot 1) be arbitrary, spiteful, capricious; 2)unreasonably burden fundamental rights; 3) unreasonably restrains alienation (or competition);4) be unconscionable.

26


27/51

COMMON INTEREST COMMUNITIES

CICs planned community where entire community subject to whole bunch of covenants.80% of homes built in last decade are CICs.

Types of Common Ownership Communities

Cooperatives (Co-Ops)

Leasehold + business assoc: 1) perpetual leasehold interest and 2) share in biz assoc.

Association to govern owns the whole building tenants only have leaseholds.

Condominiums (Condos)

By state statutes: 3-D ownership, now can own FSA. (financing, ownership, etc. good)

Units owned in FSA, Common areas / elements owned as TICo Balconies: kind of like exclusive use easements

o Taxes: you pay for unit plus % of common areas Association to govern does not own purely admin board of directors, managers,

everyone has a right to vote if you own (so if you lease from owner: no vote)

Community Associations (HOA, POA, PUD, COA)

You own your own lot & pay taxes on it

Common areas shared & taxes paid out of membership fees easements to use

Dont need association for individual lots, only common areaso Manager to manage common areas (some states req. to be licensed & disclose)

HOAs are liked by developers, local governments, and buyers

Governance Decisions

Declaration creating CIC will impose biding restrictions (usually enforceable as real covenantsor equitable servitudes) on all units in the project. (CC&Rs: covenants, conditions, andrestrictions or just covenants) Statutory law will trump any restrictions laid out in thedeclaration. Can contest decisions, but not the documents.

Can CICs bring suit for violation of covenants? 4 Factors:

Capacity for adversarial position

Size & composition to represent community interests seeking to enforce

Adverse effect of decision sought to be reviewed by group represented Whether full participation is available to residents (in the governance)

Disputes

Disputes will be about governance decisions or disputes between neighbors.Pullman.

Buying a unit/lot and joining the community

Frequently required to purchase share in HOA/condo with the purchase of the land lot

Finances & community responsibilities

27


28/51

The HOA will be responsible for common maintenance, and will assess owners for cost basedupon budgets. Failure to pay can lead to a lien on the property being imposed through the courts.

Use restrictionsUse restrictions are an important part of the appeal of a community, and will typical require theproperty be used for residential purposes only. In addition, it may impose restraints on leases.

Architectural covenants

Important to preserving home values. The covenants may be broad (regulating down to the colorof a door) or narrow (regulating only additions).

Rules & regulations

Noise: Can impose limits on the number of decibelsNuisance: The declaration needs to define what a nuisance is for the purposes of the home owner

association. Increasingly, smoking is a nuisance.Parking: Limited supply, don't want unlimited demand.Pets: Can limit type and quantity of animals. Majestic.

Enforcement

Fines, leins, restrictions on use of common property.Courts look to notification, arbitrariness, waiver. Is P being singled out?

Amending Covenants

There must be a process documented in the bylaws for amendments. As long as followed, youcannot complain if you did not object to the bylaw that allowed the change in the first place.UCC 2-207: Additional terms vs. different terms

Different includes additional BUT additional does NOT include different

Additions dont mean all modifications, but modifications DO include additions

We dont always like modifications BUT we usually like additions

Process Unfairness / Discrimination

Implied powers everyone should know at some point they may assess duesMinority interest holders / Tyranny of majority:

May have followed process for amendments but treated one group unfairly.

99% residential decide to up fees for comm. Properties abuse of power (Colin Ranch)

Change setback requirement and now corner lot cant build unfair to 1 person (Boils)

28


29/51

NUISANCE

Nuisance or trespass?

CL: if invasion is something smaller than the eye can see it is a nuisance. Cleveland-Cliffs Iron--Liability for nuisance predicated on ability to show damages, trespass only requires invasion.

Nuisance

Substantial injury required for recovery

Annoyance or invasion

Intangible objects

Elements:

No actual entry

Indirect injury

Invisible object

Trespass

Strict liability

Invasion

Physical object

Elements:

Actual injury

Direct injury for substantial

recovery Viewable object

Law of Nuisance

Restatement

Nuisance: non-trespassory invasion of anothers interest in the private use and enjoyment of theland. It is illegitimate, reckless, or unreasonable. An illegitimate nuisance is an immoral one. Areckless nuisance is one that becomes worse with time. Reasonableness is a balancing issue ofthe gravity of the harm against the utility of the use. It is easier to prove unreasonableness inpublic nuisance cases than private nuisance.

Other concepts

English common law: A nuisance is an invasion, no matter how small, onto a property thatcauses significant harm.

Normal use concept: When faced with incompatible uses, the atypical use is a nuisance.

Temporal priority: If uses are incompatible, first to start wins. Dont award coming to thenuisance.

Neighborliness: If someones actions/use is intended to annoy, it is a nuisance

Reciprocal Problem: Coase: intersection of property interests (legit) Use A v. (legit) Use B.

Ex. Confectioner & Doctor big machines shake ground. Not prob next to someone else.

Intersection between both of them that causes the conflict.

Nuisance per se

29


30/51

An activity that is a nuisance in any circumstance and in any location regardlessof the reasonableness of it, or which violates a law specifically designed toprohibit a nuisance. Luensmann v. Zimmer-Zampese & Associates.

Nuisance remedies

Either property (an injunction) or liability (a fine). Del E. Webb.

Remedy/Protection

Property Liability

Entitlement

Plaintiff has the right to clean air;

Protect with Injunction againsts use

has the right to clean air; Protect byassessing damages ( can keep pollutingif he pays)Boomer

Def. has the right to pollute; Protect

by denying s suit (no relief) has the right to pollute; Protect byassessing damages for shutting down

( can get clean air if he pays)Spur

30


31/51

EMINENT DOMAIN

Nor Shall Private Property . . .

Any type of private property may be acquired through eminent domain.

. . . Be Taken . . .

Government first attempts to negotiate a voluntary purchase. If negotiations fail, thecondemning agency brings suit.

. . . For Public Use . . .

Boyacks 5 purposes - Takings Clauses1. Owned by Government for Public Use2. Owned by Government for Government Use

3. Owned by Private Party for Public Use4. Owned by Private Party for Private use with beneficial public effect(public externalities)a. Eliminating a harmb. Creates trickle down benefit: private externalities & rest of community benefitsc. THIS IS KELO Majority

5. Owned by Private Party for Private use with no beneficial public effect(purely private)

Stevens Majority: 1-4b are okay Kennedy concurrence adds big to benefit in 4bOConnor: 1-4a are OK Midkiff argument, what is the blight on neighborhoodThomas: 1-3 are OK disparity, powerful oppress weak, he would overrule Berman & Midkiff

. . . Without Just Compensation

Just compensation equals fair market value objective sale price

Ways to determine fair market value without arms length transactiono How much property appreciated from most recent sale

o Adjust from recent transactions of similarly situated properties

o Value of an assumed rate of return from rentsReplacement cost (how much owner

have to pay for similar land)

Fair compensation = opportunity cost value (objective measure of highest use)

Does not include value of the govt project (assembly)o BUT includes aggregate value of all temporal interests (=FSA value)

o Does not include owners subjective valuation

Quick Takes

Governed by statute

Government proves (or it is assumed) taking is for a public use.

Title then transfer to the governmento Government puts money in the courts holding for the landowner.

Court determines final award of fair compensation

Any excess money is paid back or shortfall paid out.

31


32/51

REGULATORY TAKINGS

The Takings Problem

At some point, land use regulation may so restrict an owners rights as to become a takingthusrequiring the payment of compensationeven though government does not physically occupythe land. Defining when such a regulatory takingoccurs is one of the most controversial issuesin property law today.

Three Broad Categories

Title transfer

Everyone knows its a taking, no argument.Trespassory takings

Government forces private landowner to accommodate unwanted physical

intrusions not necessary for health and safety of occupants taking away right toexclude

Non trespassory takings:

Government regulates property so intensely that it substantially destroys orsignificantly lowers its value. Harder to prove.

Government imposes burdens unreasonably on the property of a small group ofpersons for benefit of society at large.

The Modern Standard:Penn Central Transportation Co. v. New York City

Three factor balancing test to be applied generally to any takings claim:1. The extent of the diminution in value,2. The extent to which the regulation has interfered with distinct, investment-

back expectations, and3. The character of the governmental action.

Weigh the benefits and burdens

Boyacks list of regulation that isnt eminent domain

Regulation eliminating right to destroy

Regulation eliminating right to sell

Regulation eliminating right to transmit property upon death

Boyacks regulation that is: eliminating the right to exclude

Per se regulatory takings

100% loss of value in the land

Trespassory takings

32


33/51

ZONING

Elements of Zoning Ordinances

The typical state zoning enabling act empowers a city council or other local legislative body to:(1) adopt a comprehensive plan; (2) enact a zoning ordinance; and (3) delegate administrativeauthority to an appointed board

Zoning:1. Local code that regulates which uses are permitted in which areas. Typically a mapdesignating areas and descriptions of types of uses for each area. Uses are described both byinclusion (permitted uses) and exclusion (prohibited uses). Areas are often further limited w/respect to permitted building size and shape and locationa. Based on segregating usesb. Creating law based on comprehensive plan

Comprehensive Plan:2. Typical first step in designing communitys zoning, involving drawing areas designated tovarious use classifications on map of the county. Will prescribe types of future uses will beallowed, and provide for interconnected development elements like transp., infrastructure and openspace. Prepared by prof. experts hired by municipality and not strictly speaking a legallyenforceable regulationnot an admin. act, (guidelines rather than actual rules).

Conditional Use Permits:

3. Specifically negotiated variation to the basic regulatory use designations (set forth in themap), b/t landowner and local govt specifically allowing certain use to exist if otherwise neitherproscribed nor explicitly permitted. Such approvals are quite common. Often conditional,requiring certain compliance acts.

Variances:4. Approved departure from basic regulatory use designations (set in map), b/t landowner andlocal govt granted b/c of specific hardship that regulation causes on landowner. Hardship mustnot be self-imposedand typically more than financial, often resulting from some special feature orproblem of land itself (ex. irregular lot size).a. To get approval, land owner must show a) undue hardship by having to otherwise complyw/ regulations and b) no negative impact on property values of lots around

Subdivision Approval:5. Discretionary permission granted by municipality to landowner or developer to change lotdesignations and/or layout of certain land. Typically includes map to be filed in land records toclarify lot dimensions and boundaries and ensure available infrastructure and neighborhoodcompatibility and coord. Approval often requires developer to pay for road, schools, firehouse,etc. (Like a K with a municipality)

Planned Unit Development:

33


34/51

6. Essentially a K b/t developer and municipality, creating a zoning effect (rather than acovenant effect.) Allows for mix of uses as described in approved site plan, and once approvedbecomes the zoning itself (trumping designation to contrary code) (K with dev)

Overlay Zones:7. Additional layer of regulation of use for particular area. Typically adds to use (and other)designations already created by regulation, so both layers will govern land use in that area.

Performance Zones:

8. Regulations aimed at restricting certain types of outputs rather than uses. Often used todeal w/ noise, air and water pollution and hazardous materials.

Buffer Zones:

9. Transition areas so-designated by the regulatory authority to ease the transition betweendifferent types and classes of land use.

Non-conforming Uses:

10. If a regulation is passed that disallows current use of property, virtually all municipalitiesoffer some relief to affected landowner. If land was previously in conformance w/ a prior iterationof land use law, then these use rights are typically seen as vested. Because of vested use rights,such land owners either can maintain this use orwill be granted some period of time during whichthey cangradually bring their property into eventual compliance (amortize) w/ the new law.(Sometimes called grandfathering a use.)

Zoning Amendments

Zoning ordinance may be modified byzoning amendmentadopted by city council or other localgovernmental entity. Most jurisdictions will invalidate such amendment if it constitutes spotzoning: rezoning that confers a special benefit on a small parcel of land regardless of the publicinterest or the comprehensive plan.

Euclidean Zoning

USSC upheld constitutionality of zoning in famous decision ofVillage ofEuclid. Ct held zoningordinance rational basis test. The ordinance was a cumulative zoning scheme with hierarchy ofuses. In any zone the use can be that zoning designation OR a higher use.

Ex: Highest zone is for Single family Homes Under is for apartments. Can build apts

or single family homes Under is for office. Can build office, atps or single familyUnder is for retail. Can build retail, office, atps or single family

Zoning and Constitutional Framework

Although Village of Euclidupheld zoning as constitutional, it may be challenged under the EqualProtection, Due Process, and Takings Clauses, plus the First Amendment protection for freedomof speech and religion. In addition, state constitution concerns come into play.

(e.g. Township of Mt. Laurelwhere the NJ SC invalidated a zoning statute aimed atexcluding low income groups based on an state constitutional obligation to meet a certainfair share of the regional need for low income housing.)

34


35/51

WATER RIGHTS

Public Trust Doctrine

Public trust doctrine: certain resources preserved for public use, and the government is required tomaintain them for the public's reasonable use public is the owner that benefits

If you can categorize something as a navigable waterway then you can regulate it!

Navigable waters

Most often invoked in connection with access to the seashore.

State laws differ, in general limits rights of ocean front property below mean high tide lineo Most states allow free access to intertidal zone for walking, swimming, sunbathing, etc.

This does not always include right to cross private land to reach the shore but prevents private

owners from excluding the public below the mean high tide line.o Massachusetts and Maine (exception states): allow private ownership far as mean low

water line but allow for public rights to fish, fowling & navigation (w permits).

Natural resources

Doctrine has also been used to provide public access across & provide for continued publicinterest in those areas where land beneath tidally influenced waters has been filled.o In some cases: limited (ex: to transportation) & others, provision for public access.

Most states: lakes and navigable-in-fact streams are maintained for drinking and recreation

purposes under a public-trust doctrine.

Boundaries

Accretion : land mass increases by sediment deposits

Avulsion : change is sudden, rather than gradual one like erosion, boundary will stay sameo So even if the river changes, the boundaries stay the same for the land

Subsurface ownership boundaries are same as those on surface, projected downward tocenter of eartho Roman legal principle: ad coelom: own things in a column to depths & up to space

Groundwater, Oil, and Gas Reserves

CL Rule of Capture (English): 1st person to "capture" resource owns resource (you haveto actually take control, once your ownership vested, you dont lose by losing possession)o Ex: landowner who extracts or captures groundwater, oil, or gas from a well that bottoms

within the subsurface of his land acquires absolute ownership of the substance, even if it is drainedfrom the subsurface of anothers land

Owner that captures substance owes no duty of care to other landowners35


36/51

o Ex: a water well owner may dry up wells owned by adjacent landowners without fear of

liability, unless the groundwater was withdrawn for malicious purposes, the groundwater was notput to a beneficial use without waste, or (in Texas) "such conduct is a proximate cause of thesubsidence of the land of others"

o Cant extract the substance from someone elses land by drilling on a slant. Reasonable Use (American): cant use it in unreasonable or wasteful way: use what needo Owner of land overlying a groundwater source has the right to pump as much groundwater

as he/she can put to a reasonable use on the overlying tracto Correlative rights: All landowners share rights to the available water from a groundwater

source over which they own land on an equitable basis, such as pro rata according to acreageoverlying the groundwater source

Note: Off-tract uses permitted if there is a surplus of water)o Prior Appropriation: Rights to pump and use groundwater have relative superiority and

protection in accordance with the time at which the pumping first began

Senior appropriators cant prevent new wells that might affect their rightso Permits: many states require perm. from state agency before can pump groundwater

Riparian Rights

Eastern states: Owner of land bordering on or straddling a body of water has a right toreasonable use of water flowing past or through his or her propertyo Traditionally riparian owners couldnt divert the water; now some uses have been allowed

if consistent w public interest or if no injury to co-riparianso CL: riparian landowners enforce rights by claims against competing riparian landowners;

allege harm from competing users unreasonable uses of shared waters

P must prove unreasonableness & injury to his/her riparian rights

Western States: first in time, first in right / rule of captureo Rights to divert water form a system of priority according to when a person or entity

diverted the water, senior appropriators have the superior right

Junior appropriators must reduce/cease their diversions in reverse order of seniority iftheres a drought or reduced flowo Fundamental elements of an appropriation right to water are:

1. Intent to put the water to a beneficial use (prohibits waste- must employ reasonablyefficient methods for using water)

2. Actual diversion of prev. unappropriated water from surface waterway

3. Application of the water to a beneficial use; and 4. Relatively continuous use of water (seasonal/occasional interruptions ok)o Anti-speculation doctrine : investors or speculators in water cant acquire rights for future

uses if they do not put the water to beneficial use nowo Abandonment : appropriation right will be lost if the appropriator evinces an intent to

abandon the right and acts in a manner that unequivocally manifests this intent

Forfeiture : non use that exceeds the statutory period

36


37/51

Hybrid States (along the pacific coast): follow both systems- legislation that req. waterusers to obtain permits from state regulatory agency to acquire a legal right to use watero Prior appropriation dominates & only historically exercised ripar. rights recognized

37


38/51

ENVIRONMENTALLY SENSITIVE LANDS

1. Traditional View: served non-ecological valuesa. Economically productive use of land

b. Wealth creation and preservationc. Human liberty and autonomyd. Social order e. Property = bundle of rights

2. Special features of environmentally sensitive lands:a. Vulnerable to environmental impact (erosion)b. Provide resource valuesc. Have aesthetic or ecological valuesd. Threat of extinction of plants/animals

3. Endangered Species Act- prohibits any person/entity from adversely modifying thecritical habitat of federally listed endangered/threatened species without a permit

a. Just v. Marinette: Owner of land has no absolute and unlimited right to change theessential natural character of his landso as to use it for apurpose for which it was unsuited inits natural state and which injures the rights of others

i. Not unreasonable exercise of power to prevent harm to public rights by limiting use ofprivate property to natural uses

ii. Ordinance prevents changing of natural character of land near a lake/river because of suchlands interrelation to the contiguous water

iii. May provide more economical value to the owner but causes harm to publiciv. Public Trust Duty

1. Requires state to promote navigation, protect and preserve waters for fishing, recreation,and scenic beauty

v. Value based upon changing character of land at expense of harm to public rights is notessential factor or controlling.

b. Palazzolo: Regulations promulgated by council protected coastal salt marshes as "coastalwetlands,'" on which construction was severely limited

i. Rule: a claimant does not waive his right to challenge a regulation as an uncompensatedtaking by purchasing property after the enactment of the regulation challenged because1. such a principle would make constitutionality of a regulation a matter of passage of time,thereby creating [SOL] on a constit. right2. such a principle also prejudices owners at time of regulation, whose ability to transfer landhas become seriously impaired; and3. such a principle would create different and unequal rights between different classes ofowners (old and new owners)

38


39/51

STARTING OWNERSHIP CHAINS

First in Time / Rule of Capture

No one owns wild animals in natural habitats. Under CL capture rule, property rights in animals

acquired only through physical possession. First person to kill or capture wild animal acquirestitle to it, bc they are first to provide notice of possession & maintain control over the possession

Pierson v. Post.o Fox hunt case: Court held that the true owner is the first to actually kill,

capture, or mortally wound the animal.

Accession

Allocates ownership to owner of thing with closest connection to it (ex. allocating offspring ofanimals to owner of the animal). If you create something new out of raw materials owned bysomeone else, you could possibly be the owner of the new thing you created.

Requiresgood faith. If you knowingly use anothers materials, ownership in your

finished product will typically be granted to the owner. Object must be transformed must use prior materials to make new, distinct thing.

Most value of object must be derived from your laborrather than owners materials.

Does not apply to land, but grants rights to things produced from landowners land.

Adverse Possession of Land

Exists to punish current owners for failure to exercise diligence and failing to use the land whilerewarding those that may have begun to develop a personhood attachment to the property.

NOT available against the government

Can be protected against by providing a revocable license to use the land or an easement

to use a limited portion of it. AP must bring action to quiet title to the land.

Elements: Requirements of adverse possession: OCEAAN.

[O] Open

Both the use and the property line must be open and notorious. Manillo (Objective)

DOES NOT matter if the first owner knew.

Must only be such that a reasonable owner who inspects the land would know.

Usually a fence, house, etc. being built makes it open & notorious.

[C] Continuous

The adverse use of the land must have continued for the statutorily defined period.

You can tack on the time of any preceding adverse possessors, so long as they met theother requirements and there is privity of claim.

Tolling: Timing begins from when the first owner could have brought a claim. If the firstowner is disabled, the timing tolls (stops) until disability lifts.

o Disability must exist when AP began

1. Infancy (SOL ends at 18 + 5 years)

2. Insanity39


40/51

3. Imprisonment

4. Military Service

[E] Exclusive

Must deny the first owner some right to the land.

[A] Actual

Must be actually used.

[A] Adverse

Possession must exists under a claim of title or right

Color of Title / Bad Title: AP has claim on paper.o AP has a claim to all the land encompassed within the title except that used by the

true owner, even if AP was only using a portion of the titled land.

Claim of right: no title, but have been using land and claim a right to continue using it.

o In all cases you only get the part of the lot you were actually possessing.o Minority positions:

Majority: Good faith belief allows adverse possession.

Minority: Bad faith belief allows adverse possession.o Majority position: If you acted like it was yours and can establish with objective

evidence than it is yours.

[N] Notorious

Goes with open. The claim must be such that it could be known to the public at large.

Prescriptive Easement / Easement by Prescription

Whereas AP will result in full title to that land upon the expiration of the SOL

AP of easement for full statutory period will result in easement by prescription to the user.o Accompanied by requirements for AP (OCEAAN)

Defenses to Prescription: self help (build a fence), sue for trespass, report a crime to thepolice, give permission for a specific period so that the use has to cut off

Note: No negative easements by prescription in US, only UK

Boundary Disputes / Equitable Boundary Adjustments

Open and notorious means occupation is obvious, not the boundaryo Minority: ifreasonable ownerwould know where boundary was, thats O&N

o NJ: if you have a boundary dispute, you have to have actual knowledge Possibility 1: A owns the entire strip because of 20 year continuity

Possibility 2: B sues for trespass and A petitions to the court to adjust survey via QuietTitle Action (finalizes your absolute title possessor)

Agreed Boundaries: courts can adjust bound. if all TREAT bound. as something elseo Uncertainty about the true location of the boundary

o Agreement about a fence/natural boundary (can be express/implied from either/both of the

neighboring landowners marking line & both acting as it were boundary)

40


41/51

o Mutual acquiescence in location of line, usually manifested by each neighbors possessing

up to agreed upon boundaryo Acquiescence must be for a certain period of time

DEEDS & CONVEYANCES

Deeds

Pass Legal Title

Anyone can write, no required form, simple requirements:o Intent to convey / sell with this instrument

o Names of parties

o Description of Property : exact size, shape, & location (read literally by courts)

If inadequate, doesnt transfer anything

If only describes part of larger tract, but doesnt identify part, defective.

No other parcel should fit same description.

Must be enclosed area

Cannot properly describe land in sq. feet

3 types: 1) Government Surveys (29 states), 2) Meets & Bounds(TX & E. Coast), 3) Reference to Recorded Platts much easier

Easily understandable, forever understandable

Description should correspond exactly with land intended to be conveyed:

substantial landmarks, area, distance, and directiono Consideration

o Signed by person to be charged (seller)

o SOF: must be in writing.

Notary: least cost avoider for forgery

Defense lawyers can use:o Adverse possession for boundary disputes

o Rules of interpretation to figure out inconsistencies

Mistaken improvements (ie on wrong land):o Sell property or keep improvements & pay improver

o If A improves Bs land in good faith, may ask for equitable relief but may NOT

demolish w/o consent of landowner may be required to pay waste if does so.

Water Boundary: stream is boundary, division follows thread of non-navigable waterwayo Avulsion original stream remains boundary (sudden change)

o Accretion owner gains land as water recedes

Legal Delivery for conveyance to occur, deed must be delivered

o Requirements: Present intent (by grantor) + physical transfer + acceptance

Notarized usually presumes intent

Recorded presumes deliveryo Types of Delivery

Manual / Physical: delivery of signed deed (escrow delivery usually good)

Constructive Deliv.: actions equivalent to delivery relinquish to 3 rd party

Recording may show intent to deliver

Safety Deposit Box delivery to a box

41


42/51

o Grantees knowledge of location & access to box required

o If grantor can reclaim not legal delivery

Attorney instructions to deliver upon grantors death = delivery

One challenging delivery may do so by preponderance of evidence

Co-Tenancy: if you retain part of estate, conveyance automatic when creating co-tenancyBrokers

Typeso Mortgage Brokers: help with financing property

o Leasing Brokers: help with leasing

o Realtors: brokers that help in purchase & sale agreements

o Listing Broker: agent of the seller, owes sellerfiduciary duties

o Cooperating Broker: works closely with buyer and is agent of the listing broker

and therefore sub-agent of seller (even if he/she never meets them)o Dual Agency: broker who represents both buyer and seller (must disclose to both)

Everyone owes seller fiduciary dutieso 1. Duty of disclosure

o 2. Loyalty

o 3. Confidentiality

brokers still have to disclose certain thingso 4. NJ has discl. notice cooperating broker must say not lawyer & are sub-agent

Duties to Sellero Agreement between broker & seller (Agency Agreement)

1. Exclusive Rights: best for broker still gets commission if owner sells

2. Exclusive Agency: only listing broker can bring buyers in

3. Open: sellers like any broker can bring whoever sells gets commis.o Broker is fiduciary

o Broker must use due care, diligence, & disclose all offers to seller

Duties to Buyero Sellers broker owes duties to the buyer

o Broker who misrepresents property is liable to buyer for that misrepresentation.

o Warn of material defects (impact value or unknown to buyer but known to broker)

o Limited duty of disclosure limited due to seller / buyer conflict

MLS: connection between listing broker & cooperating brokers

Three phases of land deal:o Purchase & Sale Agreement

o Due diligence / executory period / pre-closing Financing

Physical condition of land

Legal Title status (marketable title)o Closing (title) = delivery of deed

Brokers get commission when sale goes through.

o 1. Condition fails no commission

ie condition for financing

realtor form MAY make buyer liable to broker for commission

42


43/51

o 2. Buyer default

Modern (inc. NJ): no commission

Traditional: yes commission

Broker can sue buyer if the buyer defaults

o 3. Seller default commissiono 4. Impossible no commission

43


44/51

Marketable Title

No document called title chain of title established by deeds of sale.

Title that a reasonable and prudent businessperson, with knowledge of facts & their legalramifications, would accept.

o You can never argue title problem if you agreed to something in recordo Reasonably free from encumbrances (title must appear free of defects)

1. Chain of title

2. Right of possessor

3. Undisclosed future interest holders

4. Lien (subject to mortgage or big claim)

5. Non possessory interest in property (easement or covenant)

encumbrances that make unmarketable (title defect)o negatively effects the value

some are okay ie electricity easements, etc.o

doesnt effect the value 6. Encroachments (never on record, cant be agreed to in sale K)

building goes over easement or boundary area

very bad most likely unmarketable

7. Non-legal title issues / Government issueso Insurable doesnt mean marketable (title insurance only gets you damages)

Insurance payments may not equal costs to cure

Buying a lawsuit is not marketable title

Marketable Record Title Act: limits title searches to 30 yrs & voids earlier interests

FINANCING & THE RECORDING SYSTEM

Mortgages

Conveyance/retention of interest in real prop. as security for performance of obligation.o Obl. Arises from a loan made by mortgagee to mortgagor

Equitable Right of Redemption (ERR): mortgagor may redeem property from mortgageeeven if payment is late UNTIL foreclosure sale.

o Court will not allow parties to contract out of ERR.

Statutory Right of Redemption (SRR): specific amt of time (6-8 mos) AFTER foreclosuremortgagor may redeem property from purchaser at forecl. price + interest & expenses

The Note: the obligation / actual proof of the debt must be recorded. Date stamped.o Mortgage is the collateral itself no note is like no consideration, doesnt work.

Payment Waterfall (based on date-stamp).o 1st mortgage (2005) $500K

o 2nd mortgage (2007) $200K

o 3rd mortgage (2009) $50K

o house sells in foreclosure for $800K goes down waterfall paying each, leftover

is for the ownero house sells for $480K goes down waterfall paying each until runs out

44


45/51

mortgage (collateral) interest is gone for all of them

each have a separate claim to bring against owner using the note

Foreclosure Process:o Judicial Sale (file lawsuit) expensive & time consuming

o Non-judicial Sale (auction on courthouse steps or other location) Far more popular in states where its allowed

Borrowers like it because dont have to pay court costs

Issue: can happen without judicial oversight (not done right)

Statutes supposed to protect against this happening

Sales of Property Subject to Mortgageo A person who acquires secured property normally takes subject to security

interest, unless the security interest has a due-on-sale clauseo Grantee not personally liable for debt, unless agreed to assume it, but since holds

subject to security interest, will lose prop in foreclosure if fails to make payments.

Original borrower remains liable promissory note unless lender releases

Factors that make a sale look like a mortgage:o 1. Intent for loan

o 2. Price Adequacy looks suspicious if just 50% of market value

o 3. Behavior after sale does seller possess, pay taxes, improve? borrower

o 4. Process of negotiation & relationship between parties

o 5. Originally seeking loan and they said give me your deed, will not look like sale.

o 6. (Motive for characterizing it this way?)

Mortgage

(Transfer of interest in

property as security forperformance of obligation)

Deed of Trust

(Transfer of interest in

property as security forperformance of obligation)

The owner of property whouses the property as securityfor performance of obligation.

Mortgagor Trustor

The obligee, lender, or personwho extends credit.

Mortgagee Beneficiary

Third party, often a titlecompany or bank, that holdsproperty in trust as security.

None. The lender holdstransferred interest inproperty.

Trustee

Method of foreclosure Usually judicial foreclosure

sale.

Usually power of sale

foreclosure sale.

Recording

CL: One cannot convey what one does not owno First in time, first in right

Exception: where second holder has legal interest as BFP w/o notice

UCC 2-403: you buy as a BFP from a merchant and seller didnt own it you still get ito Original owner can make a claim against seller possibly get some remedy

Recording Acts: what must be recorded?

45


46/51

o Every instrument by which interest in land, legal or equitable, created / modified.

Not only FSA, but also LE, mortgages, restrictive covenants, tax liens.

46


47/51

Recording Systemo Notice to the world that land is conveyed.

o BFP: one who purchases (1) for valuable consideration (2) w/o notice at the time

of any problems with the grantors title.

NOT BFPs: people who receive interest as a gift (devise or inheritance) CAN prevail if they record as subsequent purchaser has notice

Not required for race statute

o One who takes from a BFP will prevail over any interest over which BFP would

have prevailed once BFP has good title he passes good title.

Recordationo Title passes on delivery, not recordation

o Must deliver to records office

Value (consideration)o Not necessarily money

Ex. Can be extra time to pay back a loan

Purchaser protected from time consideration paid (even if deed recorded &delivered)

Marketable Title Act: (see above) only have to look back 30-40 yrs for recorded titles.

Recording Process:o Filing: county recorder date stamps & makes copy. Copy goes into deed book.

o Indexing: recorder indexes to know which deed book in which to find the copy.

Grantor / Grantee Index: organized by both grantee & grantor names

Search necessary to find judgment & federal tax liens by debtor

Start with grantee index trace back to grantor and then by thatgrantor as the grantee etc. until you find the root (30-40 yrs).

Then to grantor index trace the chain back to present from the rootto see if any other encumbrances (easements, etc.)

o Note: wont find wild deeds if recorded after subsequent

deeds which stayed in chain of title

Tract Index: organized by parcel of land, find everything on one page

Recording Acts

o RACE statutes:

Whoever records first

Can essentially convey property one has already sold / does not owno NOTICE statutes:

Is B a BFP? If yes B gets property, we dont care who records. Actual Notice what you do know

Constructive Notice what you should know

Record (must search records) so if A recorded B cant be BFPo B required to search land, probate, & tax lien records

Ground Inquiry you must look around you!o RACE-NOTICE statutes:

(1) Did B record first (race)? (2) Is B a BFP (notice)?

B must have BOTH 1 & 2 in order for B to win.

47


48/51

o Shelter Rule: one who has good title can pass good title even if purchaser n

Property Outline for Boyack

Documents

Transcript of Property Outline for Boyack