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Table of Contents

Specific Attack Outlines


Lost, Mislaid, Abandoned Property, and Treasure Troves. . . . . . . . . . . . . . . . . . . . 4
Adverse Possession Over Personal Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
Estates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Capture Doctrine
Capture of Animals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Capture of Gas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Personal Property
Lost Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Mislaid Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Abandoned Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Treasure Trove . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Who Can Bring Action? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Who is Liable? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Civil Causes of Action. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Adverse Possession Over Personal Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Right to Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Copyrights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Trademarks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Patents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Property Rights Over Unconventional Things . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Intangible Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Property Rights in Body Tissue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Freehold Estates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Words of Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Present Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Future Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Vested Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Contingent Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
Conditions of Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Transferability, Devisability, and Descendibility of Interests. . . . . . . . . . . . . . . . . . . . . 22
Table of Consanguinity (For Determining Priority in Intestate Secession) . . . . . . . . . . 23
Unenforceable Conditions in Deeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Rule Against Perpetuities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Landlord-Tenant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . 25
Types of Leasehold Estates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Assignments and Sublets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Landlords Duties and Tenants Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Tenants Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
Destruction of Premises (Almost Exclusively Commercial Problem) . . . . . . . . . . . . . .31
Landlords Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Eviction (Unlawful Detainer Action) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
1

Disallowed Self-Help Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33


Concurrent Estates . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . 33
Tenancy in Common . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34
Joint Tenancy With Right of Survivorship. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Tenancy by the Entirety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Community Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
Ouster of a Concurrent Tenant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Rights and Obligations Between Co-Tenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Partition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . 38
The Modern Real Estate Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . 39
Overview: Components of a Modern Real Estate Transaction. . . . . . . .. . . . . . . . . . . .39
The Sales Contract. . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . 39
Titles. . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . .40
Caveat Emptor and the Duty to Disclose . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
Sellers Remedies for Breach of Sales Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Risk of Loss . . . . . . . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
Equitable Conversion Doctrine . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
Merger of Sales Contract Into the Deed . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Financing a Real Estate Transaction . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Did seller deliver the deed to the buyer? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
Elements of the Deed .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Types of Deeds .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Covenants for Title . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
How Mortgages Work . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Gifts
Requirements for making a lifetime (inter vivos) gift . . . . . . . . . . . . . . . . . . . . . . . . 46
Requirements for making a gift causa mortis (in contemplation of death) . . . . . . . . 47
Delivery of Gifts . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47
Revocability of Gifts . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47
Donative Intent What Can Be Donated? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Joint Bank Accounts . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
The Recording System . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48
Which Index to Select . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
How to Use Indexes . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
How Much Protection Does a Purchaser Have Against a Prior Unrecorded Deed? . 50
Types of Notice . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Complications With Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52
Types of Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52
How Are Easements Created? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Scope of Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Relocation of Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56
Use of Easements to Serve Non-Dominant Estates . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Duty to Make Repairs/ Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
How Can an Easement Be Terminated? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57

Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
How are Covenants Created? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
When Does a Covenant Apply to Successors to the Estate? . . . . . . . . . . . . . . . . . . . . .58
Unenforceable Covenants Due to Bad Public Policy. . . . . . . . . . . . . . . . . . . . . . . . . . .60
Modification of Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Termination of Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64
Takings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
When is Eminent Domain Permissible? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
When Does Govt.s Permanent Physical Occupation of Land Constitute a Taking? . .66
When Do Govt. Land Use Regulations Constitute Takings? . . . . . . . . . . . . . . . . . . . .68
Regulatory Takings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Not Regulatory Takings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
When Do Judicial Decisions on Property Rights Constitute Takings? . . . . . . . . . . . . .70
Hostile Acquisition of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71
By Conquest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
By Adverse Possession . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Acquiring Easements By Prescription . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73
Limits to Adverse Possession/Prescription . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Rationale for Adverse Possession/Prescription Doctrine . . . . . . . . . . . . . . . . . . . . . . . .73
Private Discrimination in Selling Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Racial Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74
Discrimination Against the Handicapped . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74
Laws for structurally supporting others land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Water Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75
Rights to Streams and Lakes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Rights to Underground Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Diffuse Surface Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Torts to Personal Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Nuisance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77
Trespass to Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Torts to Real Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Trespass to Chattels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

Attack Outlines
Lost, Mislaid, Abandoned Property, and Treasure Troves

Did the owner involuntarily and unintentionally part with possession of the property? - it
is lost property
Did the owner intentionally place the property somewhere and then overlook or forget
where it was? it is mislaid property
Did the owner voluntarily part with the property and have the intent to disown it? it is
abandoned property
Is the property currency or valuables that were hidden by the owner so long ago that the
original owner is dead or undiscoverable? it is a treasure trove

Adverse Possession Over Personal Property

Need to show
o
1) Actual and exclusive use
o
2) adverse and hostile use
o
3) claim of right
o
4) open and notorious use
o
5) continuous use
o
6) for the statutory period
Two possible rules
Discovery rule
Demand and refusal rule

Intellectual Property

Does the dispute relate to someones identity or likeness? Relates to the right to
publicity
Is the property in question a creative expression? Copyright
Is the property in question a distinguishing feature or mark? Trademark
Is the property in question a new, novel, and useful manufacture or process? Patent
How do you let someone else use your intellectual property?

Covenants
Enforcing a Pre-Existing Covenant
1) What remedy is being sought?
o
Is the remedy sought a legal (i.e. damage) remedy? P must show that there is a
binding real covenant (covenant at law)
o
Is the remedy sought an injunction or specific performance? P must show that the
covenant qualifies as an equitable servitude (Covenant in equity)
2) How was the covenant created?
3) Did the person against whom it would be enforced have actual, constructive (including
record), or inquiry notice?
4) Was it intended to run with the land?
5) Is the enforcer a successor to the original covenantee? Is the person against whom the
covenant would be enforced a successor to the original covenantor?
o
A successor to the original covenantee who wants to enforce the covenant must
show that the covenant touches and concerns his land
4

o
If bringing suit against a successor to the original covenantor, you must also
show that the covenant touches and concerns their land
6) Have you met the privity requirements?
7) Is the covenant unenforceable?
Modification of Covenants
Termination of Covenants
Is a party trying to enforce a promise by another party or its predecessor to do or not do
something on the land or with land transactions (Covenants)
o
Does the covenant run strongly against public policy objectives?

Estates
1) Determine Whether there is a Valid Title
Is there a title to the estate? If yes, proceed to next question, if no the government
probably owns the estate
2) Determine Nature of Grantors Estate
Rule: Grantor cannot deed a greater estate than he has
3) After determining estate the grantor has, then 1) determine the words of purchase
(identify the grantee) and 2) determine the words of limitation (identify the nature of
the estate)
Words of purchase are straightforward
Words of limitation can be confusing
4) Determine the Present and Future Interests In Order of the Way They Are Written in the
Deed
Present Interests
Fee simple absolute
Defeasible fee simples
o
Fee simple determinable
o
Fee simple on condition subsequent
o
Fee simple on executory limitation
Lesser estates
o
Life estates
o
Fee tails (not in use anymore)
o
Term of years (aka a lease)
Future Interests
Vested future interests
o
Indefeasibly vested future interests
Indefeasibly vested remainders
Indefeasible reversions
Springing executory interests that start after a specified gap in possession (i.e. O to
A for life, then to B five days after As death)
Possibility of reverter
Right of re-entry/power of termination
o
Vested future interests subject to complete divestment
Vested remainders subject to complete divestment
Reversions subject to complete divestment
5

o
Vested future interests subject to partial divestment (subject to Rule Against
Perpetuities)
Class gifts
Contingent future interests (subject to rule against perpetuities)
o
Contingent remainders
Includes alternative contingent remainders
o
Executory interests (except for certain springing executory interests)
Contingent class gifts are also classified as an executory interest
5) Determine Whether the Rule Against Perpetuities Terminates Any of the Interests
6) Determine Whether Any of the Conditions are Unenforceable
7) Repeat Step 4 In Light of Steps 5 and 6

The Capture Doctrine


Capture
The acquisition of property rights simply by taking possession of something
o
Unlimited right to acquire, so long as the resource was obtained without
trespassing in anothers property
o
Some courts have imposed a reasonable use requirement for things like water
(Cline)
Rationale: Encourages competition/ efficiency. Clear way to determine an owner
Capture of Animals
Capturing wild animals
o
Possession of a wild animal (ferae naturae) does not start until you exercise
dominion/control and intent to posses or you have mortally wounded it
o
Case Law: Pierson v. Post fox belonged to the party who mortally wounded it
and captured it, not the party who was in pursuit of it when the other party intervened
Animals on ones property
o
Ratione Soliby ownership of ground; landowners have constructive possession
of wild animals on their prop until they escape
Case Law: Keeble v. Hickeringill - D liable for firing a gun to scare away ducks in
Ps pond; ducks P was using for his livelihood
o
Animus Revertendi
Principle that if a captured animal has been domesticated and has habit of return
(animus revertedi), it is not available for capture by another
However, if the animal is wild and has no animus revertendi, once it escapes it is up
for grabs
Ex: someone cant steal your dog when it runs away, but they could probably take a
duck that you lured into your pond
What Constitutes Unlawful Interference With Animals on Someones Property?
o
Cannot maliciously interfere with the rights of someone else to make a livelihood
on his own land (Keeble)
o
Cannot trespass
o
But you can interfere through traditional business acts (i.e. having a better way to
lure ducks to your pond)
Capture of Gas
Capture doctrine applies to gas as long as you do not trespass on someone elses land to
get it
o
Case Law: Anderson v. Beech Aircraft Corporation: Non-native gas that is
placed in a natural reservoir is bound by the capture doctrine. While the gas is in the
reservoir, it is in its natural environment, and thus anyone who is not trespassing on that
reservoir can extract it and own it. When this gas it put in the reservoir, and thus in its
natural state (escaped), no one has title to it
Rationale: gas put in the ground is equivalent to a wild animal
Problems with applying capture doctrine to gas:
o
Encourages each landowner to grab as much of the resource as possible as early
as possible (tragedies of the commons)
7

o
Or, if the gas company tries to buy all the available land on which the reservoir
sits, it encourages the landowners to hold out for as high a price as possible
o
Leads to overinvestment in wells and drilling equipment and a speedy but careless
extraction process
o
People may withdraw lots of gas even when we dont need to be mining that
much
Possible solutions
o
Fair Share quotas
Owners may only withdraw up to a pre-calculated amount
o
Reasonable Use limits designed to prevent egregiously wasteful practices
o
Unitization or Pooling arrangements
Reservoir is managed as a single unit for the benefit of all the overlying owners

Personal Property: Lost, Mislaid, Abandoned Property, and Treasure Troves


Lost Property
A finder of lost property has a right to the property against everyone but the original
owner (Armory v. Delamirie)
o
Definition of finder: one who has established 1) physical control over the property
and 2) intention to assume dominion over the object
o
Case Law:
Armory v. Delamirie holder that P chimney sweep boy, who found jewel, was
entitled to damages after bringing a suit in trover against D goldsmith, whose
employee took the jewel, took out the stones, and gave the empty shell back to P;
even though P was not original owner
Hannah v. Peel holding that P soldier who found a diamond brooch in a house
temporarily requisitioned by British Army was entitled to the house against the
Downer of the land, who didnt know the true owner or know of the broochs
existence before
Chattel was appropriately classified as lost because it was in the crevice of
windowpane
The attachment exception does not apply because the brooch was not attached
to the land it was unattached on the surface of the land
The private place exception does not apply because the owner of the land
wasnt even living in the house it had been requisitioned by the army
Owner couldnt argue that he had custody of the brooch on behalf of the owner
because the brooch wasnt intentionally deposited in his home
Counterargument: You could argue, given the circumstances, that the property
was actually mislaid and thus belongs to the owner of the locus in quo (which is
D)
o
Exceptions
1) Trespasser has no right to property he found on the land hes trespassing on
2) employee has no right to property he found while in the course of his
employment it goes to his employer (Staffordshire v. Sharman)

3) owner of real property possesses rights to all property that is attached to the land
(Staffordshire v. Sharman)
4) you cannot find lost property in a highly private place (i.e. someones home)
only in an area that is open to the public (i.e. a museum) or in an area that the owner
does not occupy (i.e. a house that you own but do not live in)
Mislaid Property
When property is mislaid (intentionally placed somewhere by the owner, and then
forgotten about), the owner of the locus in quo (place where the property was kept) has a
right to the property against all but the original owner
Case Law
o
McAvoy v. Medina holding that after a wallet was inadvertently left at a barber
shop, D barber was entitled to keep it instead of the P customer who found it even after
the original owner could not be found
Rationale: When property is mislaid, the original owner is more likely to look for it
than when property is lost; he will come back to the place where he left it, so the
owner of the locus in quo is best situated to give it back to him
o
Benjamin v. Lindner Aviation holding that $18K in cash found in the wing of an
airplane was best classified as mislaid property thus, the cash belonged to the bank
who owned the airplane and not the P employee of the airplane maintenance company
who found the cash
Counterargument dissent argues that the money is at least 30 years old; this seems
to meet the standard for abandoned property; in addition, this much money wrapped
up in an airplane wing might likely have been money connected to drugs or
contraband that the owner wanted to get rid of
Abandoned Property
General rule is that abandoned property is fair game to whoever finds it
o
i.e. in Popov v. Hayashi, the baseball owned by MLB, which Barry Bonds hit into
the stands, was intentionally abandoned because MLB had no intention of reclaiming
the ball and thus Popov and Hayashi were the only two people fighting over possession
Treasure Trove
Similar to lost property: finder has a right to the treasure trove against everyone but the
true owner
When descendants of the previous owner claim ownership of long lost property that was
involuntarily taken from their control, the finder must prove abandonment by clear and
convincing evidence
o
Case Law: Columbus-America Discovery Group court rules that D insurance
companies had not abandoned their interest in sunken treasure after a shipwreck; the
salvor (finder) is to receive a salvage fee as compensation to its service but does not
receive title for its sunken treasure
Who Can Bring Action for Wrongfully Taken Property?
The original owner can bring action against either the finder or a third party who took it
from the finder

o
However, Restatement of Torts says that if the finder brings an action against a
third party for possession and wins judgment against the third party, that extinguishes
the owners cause of action against him
The finder can bring action against a third party
o
Case Law: Armory v. Delamirie - finder chimney sweep boy brings action
against third party goldsmith
Goldsmiths jus tertii defense (right of third party to the property) doesnt apply
A bailee can bring action against a third party
o
Case Law: The Winkfield bailee Postmaster General brings action against third
party for lost mail
Who is Liable for Wrongfully Taken Property?
Third party is liable to finder, original owner, and bailee
o
Third partys employer is liable to the same extent the third party is under the
respondeat superior doctrine (employer is liable for the actions of his employees)
Finder is liable to original owner
What Civil Causes of Action Can Be Brought For Wrongfully Taken Property?
Modern cause of action
o
Conversion appropriating someone elses property by establishing dominion and
control over the property
Can be a legal (damage) or equitable (specific performance) remedy
When damage amount is uncertain because the property is never returned,
courts take the high end to give P benefit of the doubt (Armory v. Delamirie)
To bring an action for conversion, one needs to establish: either 1) ownership or 2)
right to property at the time of conversion
Old rules
o
Legal Remedies
Trover action for recovery of damages for the wrongful conversion of property
To bring an action for trover, one needs to establish: either 1) ownership or 2)
right to property at the time of conversion
o
Equitable Remedies
Replevin if property was taken from the owner unlawfully
Detinue if the defendant originally took possession lawfully (i.e. had permission)
but then refused to return it
To bring an action for either, one needs to establish: immediate right to possession
of the property

Adverse Possession Over Personal Property


Requirements
1) Actual and exclusive use
2) adverse and hostile use
3) claim of right
4) open and notorious use
5) continuous use
6) for the statutory period
10

o
Different Possible rules
Discovery rule
Statute only begins to run when the true owner (who must be using due
diligence to find the property) discovers the possessor and whereabouts of the
property
Rationale: 1) balances interests because it allows the owner to locate his stolen
property, even if it takes many years, but also punishes the lazy owner by
forcing him to use due diligence to try to find the property (i.e. if the owner
does not call Interpol or contact museums)
Counterargument: For specific property (i.e. stolen ancient artifacts from
foreign governments in the Guggenheim case), even locating the true owner
may not be enough, because the govt. must figure out if the property was theirs
demand and refusal is more equitable; this would make jurisdictions with the
rule a haven for stolen property
Case Law: Greek Orthodox Church case Greek Orthodox church in Cypress
is allowed to bring suit against a purchaser of stolen mosaics almost 10 years
after goods are stolen because they had only recently discovered the purchaser
of the stolen artowrk
Demand and refusal rule
Statute only begins to run when the person figures out who owns the property,
demands that the adverse possessor return it, and the adverse possessor refuses
Rationale: Gives true owner time to not only find the adverse possessor but also
confirm whether they own the property; prevents the jurisdiction from
becoming a haven for stolen ancient property (Guggenheim)
Counterargument: Makes it unlikely that someone can ever truly establish
adverse possession, because even a lazy owner can eventually demand the
property back, and by then he will be ready to file suit to reclaim it
Case Law: Guggenheim Guggenheim museum is allowed to sue in replevin to
retake stolen artwork from someone who purchased it 20 years before because
they only recently demanded and refused
Equitable tolling
If adverse possessor has taken steps to conceal the fact that the property they
own belongs to the true owner, and the true owner has no way of discovering
this fact and is not in a position to sue, the statute may be tolled for purposes of
equity
Case Law: U.S. v. Rosner after U.S. govt. took property that belonged to
Jewish holocaust victims from the gold train and falsely claimed that the
property could not be identified, court allowed Jewish true owners to sue for
possession of the property over 50 years after the taking
Stupid exception: NYs thief rule
When a thief steals a painting, the statute begins to run immediately
Rationale: no good rationale, this rule is dumb. However, a thief couldnt sell
the work to a good-faith purchaser b/c the statute would not begin to run against
the good-faith purchaser until demand/refusal
However, fraudulent concealment doctrine may still hold thief liable at times
11

Intellectual Property
Right to Publicity
Definition: Common-law right to control others commercial use of your name, likeness,
or identity
Right to publicity often butts heads with the 1st Amendment
Rough Factor Test for Right to Publicity
How Much Does The New Work Transform the Characters Identity or Likeness?
o
Depends on whether you are replicating features of the person themselves, not
just the character they play or the role they serve on TV
o
Case Law
Wendt robots resembling Cheers characters also bore substantial resemblance to
the actors themselves and likely infringed on the actors right to publicity
Vanna White Case a robot just mimicking Vanna Whites actions on Wheel of
Fortune would not infringe on her right to publicity, but a robot built to resemble
her features would infringe on this right
Would the new work usurp the market for the original?
o
Militates against permitting use
o
Case Law
Zacchini v. Scripps-Howard republishing Ps entirely cannonball act on a news
program would usurp his market because people would watch the news program for
the video instead of seeing him in person or buying such commercial videos from
him
Bette Midler case could
Is the New Work a Form of Artistic Expression?
o
Militates toward permitting use
o
Case Law
Tiger Woods case D was allowed to sell paintings of Tiger Woods at the masters
Dustin Hoffman case D was allowed to publish photos with Dustin Hoffmans
head pasted over that of a model
Is the New Work Related to News, Politics, or Satire?
o
Militates toward permitting use
Copyrights
Purpose
1) promotion of public learning
2) protection of public domain
3) granting exclusive rights to the author
o You dont own the work, you just own the copyright to the work
How Long Does A Copyright Last?
Lifetime of the author plus 70 years
If you dont know who the author is, then the copyright lasts 95 years from the date of
first publication or 120 years from its first creation, whichever expires first
Requirements for Copyright Protection
1) idea must be fixed in some tangible medium of expression does not need to be
officially published (after 1976 Copyright Act)
12

2) must be a creative, original expression


o
Literary work
o
Musical work
o
Grammatical work
o
Pantomiming or choreographical work
o
Pictoral, graphic and sculptural work
o
Motion picture and audio visual work
o
Sound recordings
o
Architectural work
Benefits of Getting Official Copyright Registration
o
A public record
o
Certificate of registration
o
Allows you to receive from the Customs Service notice of the importation of
knockoffs
What Cannot Be Copyrighted?
The utilitarian feature of something classified as a useful article
o
However, if the article is classified as a toy instead, it may be easier to
copyright
o
Whether the utilitarian feature can be separated from the unique, creative feature
is called the conceptual separability test
o
Case Law: Oddzon KOOSH ball cannot be copyrighted because its unique
aspect (its tactility) is inseparable from its utility (makes it easy to catch)
o
Rationale: dont want companies monopolizing useful things
o
Exception
Even if certain works are not copyrightable (i.e. news), courts may quasi-property
interests over certain things in order to protect the fruits of one partys labor
Case Law: Associated Press v. International News Service court holds INS
liable for taking the APs news articles, copying them, and then selling them
before AP could break the story
Fair Use Defense (codified in 17 U.S.C. 107)
Four factors
o
1) purpose and character of the work
Commercial work (as opposed to non-profit educational) weighs against fair use; if
the work is transformative, that weighs in favor of fair use
Case Law: Suntrust v. Houghton Mifflin the parody The Wind Done Gone was a
commercial work, but it was also highly transformative because many parts
transform Gone With the Wind by depicting the characters as completely different
from the original in order to critique the originals depiction of race relations in the
antebellum South
o
2) nature of the copyrighted work
Highly creative original work militates against fair use, but this is mostly irrelevant
for purposes of parody

13

Case Law: Suntrust it wasnt particularly important that GWTW was a highly
creative original piece of literature, but it wasnt particularly important for this fair
use case
o
3) amount and substantiality used in relation to copyrighted work as a whole
Parodies can take as much as is necessary to conjure up the original, and anything
taken beyond that must serve parodic purposes
Case Law: Suntrust third factor was inconclusive but the book was at least
entitled to borrow enough parts from GWTW to show that TWDG was parodying
GWTW
o
4) whether the new work would usurp the market for the original or derivative
works
**Note: the creation of a derivative work only protects what is original in the
derivative work; it does not extend the copyright of the original
Case Law: Suntrust there was no evidence of market substitution of TWDG for
GWTW
Common fair uses
o
Criticism (includes parody)
o
Commentary
o
News reporting
o
Teaching
o
Scholarship
o
Research
Preventing Others From Using Non-Copyrightable Material
You can have them sign a contract that prevents them from reproducing the material for a
commercial purpose when they buy the original work
Copyrights to Factual Compilations
Rule: A compilation of facts is copyrightable when the facts are compiled in some unique
or creative fashion
o
Ex: casebooks, anthologies, encyclopedias, cookbooks (though the recipes
themselves would probably not be copyrightable)
o
Case Law: Feist Publications - names and addresses in Ps phonebook were
arranged in ordinary alphabetical order, so there was no copyright protection for the
phonebook
Trademarks
Requirements for a Trademark
1) typically a name, word, phrase, logo, symbol, design, image, or a combination of these
which the owner uses to identify and distinguish his products from others of a different
source
o
Exception: Functionality Doctrine - a useful product feature (i.e. a specific color
on a medical pill in order to distinguish it as a blood medicine)
Case Law: TrafFix v. Marketing Displays the fact that a utility patent previously
existed over a feature makes it less likely that the manufacturer can claim trade
dress protection for that feature (due to presumption that the feature was related to
the utility)
14

o
Exception: Scandalous marks marks cannot be registered if they are scandalous,
immoral, or deceptive
2) must have acquired a secondary meaning in the minds of the public when the public
realizes that the primary significance of the feature is to identify the source of the product
rather than the product itself (i.e. the coke bottle shape identifying the bottle as made by
coke rather than identifying the bottle as a soda bottle)
o
Must exist in the minds of the public
o
Must be associated with only the source
o
**Note: even generic or descriptive words can become trademarked if they
acquire a secondary meaning (i.e. Bank of America)
o
Case Law: Qualitex the green-gold color of the dry-cleaning pads had acquired
the necessary secondary meaning b/c the public associated the color with the
manufacturer; and the color served no purpose but identification
Extent of Trademark Protection (Lanham Act)
1) Trademarks last indefinitely
o
Exception: Trademark dilution when a trademarked feature becomes too
commonly used to the point where it identifies the product rather than the source (i.e.
Kleenex), the trademark dissolves
2) Trademark protection only extends to similar products that would otherwise be
confused as coming from the same source as the original manufacturer
o
Rationale: trademark protection exists to prevent confusion, but, for example, no
one will think that Polo makes mechanical parts for a factory press
o
Exception: Famous marks cannot be used even when no confusion is likely to
occur
Reasons for Trademark Protection
Promote competition
Allow companies to use identifying features that they can prevent competitors from
capitalizing on in order to profit from confusion by consumers
Benefits of Trademark Registration
Constructive notice to public
Legal presumption of registrants ownership of mark
Ability to bring action concerning mark in federal court
Can file registration with Customs Service and prevent importation of infringing foreign
goods
Can use U.S. registration as a basis for obtaining registration in foreign countries
Patents
What is Patentable?
1) Any new and useful process, machine, manufacture, or any composition of matter, or
any new and useful improvement thereof
o
i.e. you could patent a new and innovative recipe for making sugarless desserts
which are usually always made with sugar (i.e. pastries, cakes, etc.)
o
Case Law
Bilski SCOTUS rules that business methods can theoretically be patented, but the
disputed method here (a way for commodities traders in the energy market can
15

hedge against the risk of price changes) is not patentable because it is an abstract
idea
Diamond SCOTUS rules that a living organism that was artificially created can be
patented
2) The thing being patented must have actual utility
What Can You Do With An Intellectual Property Right to Enable Others to Use Your
Intellectual Property?
Like any other property right, it may be sold, licensed, mortgaged, assigned or
transferred, given away, or simply abandoned

Property Rights Over Unconventional Things


Intangible Property Rights
Restatement Rule: in order to bring an action for conversion against another in regards to
intangible property, the intangible right must be merged into a document representing the
right or obligation of the holder
o
i.e. a stock certificate
CA rule: merged in a document test is not necessary
o
Case Law: Kremen v. Cohen D was liable for stealing Ps right to the domain
name for the website sex.com even though this right was intangible
Property Rights Over Body Tissue
Cell Tissue removed during surgery for medical research
Rule: There is no property right of an individual over cell tissue removed by a doctor
during surgery to prevent the tissue from being used for medical research
Case Law: Moore holding that former patient could not hold his former physician
liable for conversion after the physician used spleen cells in medical research
o
Rationale: 1) no property right over the spleen cells, which he had voluntarily
given up to his physician; he did not retain title to them anymore; 2) this would go
against public policy, which wants to encourage medical research and not subject
researchers to potential liability; 3) statutes in CA clarify that human tissue must be
disposed of by incineration or internment after surgery, so there is clearly no title by the
donor
o
Counterargument: 1) this seems to offend social mores by treating the human
body as a commodity; this also seems like unjust enrichment and the patient should
receive profit for contributing the raw materials to the research
Tissue of Dead Bodies
Rule: the right of next of kin to possess the bodies of the deceased family members
extends to the organs and body tissues of the family members as well
Case Law: Newman holding that LA County Coroners removal of deceaseds corneas
w/o consent of family members was at aking of property w/o due process in violation of
14th Amendment
o
Rationale: Californias Uniform Anatomical Gift Act, which grants next of kin the
right to transfer parts of bodies in their possession to others for medical or research
purposes, and the common law right of next of kin to possess the body for burial
purposes and bring suit against others who dispose the body, creates a property interest
in the corneas
16

o
Counterargument: the right to possess a dead body is merely a right that exists for
the duty of determining who shall have custody for burial; this is more a duty than a
right and a very limited right that does not give one the control over the fate of the
corneas
Frozen Embryos
Rule: Frozen embryos left over from IVF are neither people nor property
Case Law: Davis v. Davis the embryos are neither people nor property and the mother
wants them donated to another couple, the father does not; the fathers desire to avoid
biological parenthood outweighs the mothers interest in donating the embryos

Estates
Words of Limitation
Fee Simple Determinable or Condition Subsequent?
Words creating a fee simple determinable are usually durational, adverbial words
o
so long as
o
during
o
while
o
until
o
unless
Words creating fee simple on condition subsequent:
o
but if
o
on condition that
o
provided that
o
if it happens that
Fee Simple Absolutes, Life Estate, or Fee Tail?
No words of limitation or and his heirs absolute
for life, life estate
and heirs of his body used to be fee tail, but they are not enforced anymore, so now
most likely fee simple absolute
Present Interests
Fee simple determinable
Grantor retains possibility of reverter
Fee simple on condition subsequent
Grantor retains a right to re-entry/power of termination
**Note: if someone takes adverse possession of the fee simple on condition subsequent,
the holder of the reversionary interest can still kick them out after they violate the
condition in order to get the fee simple absolute they would have to establish adverse
possession against the holder of the reversionary interest after violating the condition
(applies to a fee simple determinable also)
Fee simple on executory limitation
3rd party has an executory interest
Condemnation of fee simple determinable estates

17

Rule: Restatement holds that when a defeasible fee simple estate or the reversionary
interest is condemned, the present holder of the land gets the entire condemnation
proceeds unless violation of the condition was imminent
o
Rationale: this would unfairly profit the holder of the right to re-entry or power of
reverter when there was no sign that the fee simple would ever revert to them
o
Exception: does not apply when the reason the reversionary interest was
condemned was to allow the condition to be broken (City of Palm Springs v. Living
Dessert Reserve)
Rationale: doing so would allow cities to make an end run around a partys grant of
land to it in defeasible fee simple estates and use the land for a contrary purpose
without compensating the grantor
o
Counterargument: giving the holder of the defeasible fee simple the entire
condemnation proceeds grants them a windfall, because the value of the land to them
was actually equal to the total value minus the diminution caused by the conditions they
had to follow (Ink v. City of Canton)
Fee Tail
Not used anymore, but limits the estate to the lineal descendants
Life Estate
Lasts for the life of the grantee
Creation of a Life Estate
Rule: a deed subject to a life estate in a third person (even if the person is a stranger to
the deed) creates a life estate in that third person (Nelson v. Parker)
o
i.e. O gives fee simple to A, subject to a life estate in B, B has the life estate
and A has the remainder
Obligations of Life Tenants
Obligation to make ordinary repairs
o
Case Law: In re estate of Jackson holding that when life tenant died w/o having
made repairs to the house from storm damages, the storm insurance proceeds should
have gone to the holders of the residual interest instead of to the life tenants estate
Rationale: 1) life tenant failed obligation to make repairs; 2) since holders of the
residual interest are the ones who are now in possession of the house, they should
get the money needed to fix it
Term of Years (Lease)
See section on landlord-tenant
Future Interests
Possibility of Reverter
Need not be explicitly reserved in a grant of fee simple determinable it is assumed to
exist even if not mentioned
Adverse Possession by the holder of the fee simple determinable begins as soon as the
condition occurs
Most states limit how long the condition can last; some conditions terminate after 30-40
years; CA requires re-recording every 30 years
Right to Re-Entry/Power of Termination
18

Courts often interpret a failure to reserve a right to re-entry as the absence of a right of reentry and will instead construe the language as creating a fee simple absolute or as a
servitude (i.e. restrictive covenant, easement, etc.) or a trust
o
Case Law
Station Associates v. Dare County holding that deed granting coastal land to U.S.
for creation for a live-saving station (which failed to explicitly a provision for
forfeiture or re-entry) was a grant in fee simple absolute rather than a grant in fee
simple on condition subsequent
Conditions subsequent are strictly construed against the grantor by courts
Case Law: Red Hill Outing Club court holds that condition subsequent only requires
holder of fee simple on condition subsequent to maintain public ski slopes, not to provide
a ski tow and skiing instruction (which they had ceased to do)
o
Rationale: Occurrence of the condition would have triggered a forfeiture, and
courts are hesitant to enforce forfeitures against parties that may have been on the land
for a long time and may have developed an attachment to it
Even if the condition occurs, adverse possession does not begin until the right to re-entry
is exercised
Waiver of right to re-entry
o
Can generally be waived either expressly or through estoppel (when party with
the defeasible fee simple detrimentally relies on right to re-entry not being exercised),
so the fact that adverse possession has not officially begun may be irrelevant
Most states limit how long the condition can last; some conditions terminate after 30-40
years; CA requires re-recording every 30 years
Reversion
Definition: a reversion is a vested future interest retained by the grantor that vests upon
the expiration of the grantees lesser estate
o
Case Law: Long v. Long grant of a fee tail estate leaves a reversion, which is
fully devisable and descendible, in the grantor
Remainders
Definition: a remainder is a future interest that follows the natural termination of a life
estate or term of years
must be expressly created in the instrument creating the preceding possessory estate
Specific Remainder Rules (**only followed in a few states**)
Rule of Destructibility of Contingent Remainders
o
Old rule that a contingent remainder that had not vested upon the termination of
the preceding freehold estate was destroyed
Example: O gives to A for life, then to B if she reaches 21 if B has not reached
21 when A dies, the contingent remainder is destroyed
Today, if B was not 21, title would revert to O, and B would have a springing
executory interest that divested Os reversion when B reached 21
o
Goes along with merger doctrine (general rule is that when a person acquires all
the interests in land, present and future, a merger occurs

19

Old rule was that if a person acquired all interests in land, present and future, except
for contingent remainder (unless created in the same deed), the contingent
remainder would be destroyed anyway
Example: O gives to A for life, remainder to B if B reaches 21; then, in a later
deed, O buys As life estate this would destroy Bs contingent remainder even
if B reached 21 before A died
Rule in Shelleys Case
o
Old rule that a remainder created in the grantees heirs was converted into a
remainder in the grantee
Example: O to A for life, remainder to As heirs remainder converts to a
remainder in A, which merges with the life estate to create a remainder in A in fee
simple
**note: does not apply to executory interests, only to remainders
Doctrine of Worthier Title
o
Old rule (treated only as a rule of construction now, which is rebuttable with clear
intent by grantor) that a remainder created in the grantors heirs was converted into a
reversion in the grantor
Example: O to A for life, remainder to Os heirs remainder in Os heirs is
invalidated, which converts Os reversion subject to complete divestment into an
indefeasible reversion in O
Executory Interests
Definition: A future interest that divests the interest of another but, unlike a remainder,
does not follow a life estate or term of years
o
Most commonly follow a fee
o
Almost always contingent (except for certain kinds of springing executory
interests)
Shifting Executory Interests
o
Divest the grantee
o
Example: O to A, but if B reaches 21, then to B A has a fee simple subject to
an executory interest and B has the shifting executory interest
Springing Executory Interests
o
Divest the grantor
o
Can be vested when they follow a gap
i.e. O to A for life, then to B five days after As death
Bs interest is vested there are no conditions precedent
Bs interest is not a remainder b/c O has a reversion in fee simple that divests 5
days after As death
Thus, B has a springing executory interest and O, after the reversion occurs, will
have a fee simple on condition subsequent
**The interests of unborn members of a class are considered executory interests (because
they will partially divest the fee simple interest of the existing members of the class)
o
Example: To A for life, remainder to Bs children B has two children; the
interests of Bs unborn children are executory interests which will partially divest the
remainder interest of Bs two existing children
20

Class Gifts
Future interests to members of a class of indeterminate size (change in class size will
alter each individual class members interest)
Example: O to A for life, remainder to Bs children
Rules for When a Class Closes
Rule of Convenience
o
Rule of construction that class closes when some member of the class can call for
a distribution of his share of the class gift
Rationale: balances interest of including as many persons in the class as possible
with the interest of allowing distribution of the property at first opportunity without
needing a future rebate/redistribution
Examples
o
When a will makes a class gift, class closes at the date of the testators death
i.e. Ts will gives property to Bs children at his death, Bs existing children get
the property and Bs future children cannot get anything
Exception when there are no members of the class upon the testators death, the
class stays open indefinitely (i.e. if B had no children at the time of Ts death)
o
When a deed gives a gift at a later time (i.e. expiration of a life estate), class
closes at the time fixed for distribution
i.e. if T gives property to A for life, remainder to Bs children class closes when A
dies
o
when the class gift is conditioned upon class members reaching a certain age, the
class closes when the first class member reaches that age
i.e. if T gives property to As children who reach 21, class closes when As oldest
child reaches 21 any children that A already has have an executory interest that
vests when they reach 21, but any children that A may have in the future have no
interest
Vested Interests
Requirements for a vested interest
o
Owner is ascertained
o
Even upon which it will become possessory is certain
Exception: Event that triggers a possibility of reverter or right of re-entry is not
certain, and a reversionary interest may be defeasible however, these are still
considered vested interests because all interests retained by the grantor are
considered vested interests not subject to the Rule Against Perpetuities
o
Example: To A for life, remainder to B B has a vested remainder
Indefeasibility, Total Divestment, and Partial Divestment
Requirements for an indefeasible interest
o
Not subject to being defeated or divested
o
Not subject to being diminished in size
o
Example: To A for life, remainder to B B has an indefeasibly vested
remainder
Requirements for an interest subject to total divestment

21

o
Interest is defeated/transferred upon the occurrence of a condition subsequent to
the vesting of the interest
o
Example: to A for life, remainder to B, but if at Bs death he has no issue, to C
Bs remainder in fee simple is subject to total divestment if at death he has no issue
Requirements for an interest subject to partial divestment
o
Typically occurs when the interest is a class gift where the size of the class can
change even after the interest vests
o
Example: to A for life, remainder to Bs children at time of deed, B has two
children if B have more children, the interest of Bs first two children is partially
divested as the interest is re-divided among more recipients in the class
Contingent Interests
An interest is contingent if it only vests after the occurrence of a condition precedent
Example: to A for life, then to B if B lives longer than A
o
Remainder only vests once B fulfills the condition of living longer than A
Creating an interest in an unborn person (i.e. remainder to As first-born child) creates
the condition precedent of being born
Words of survival also create conditions precedent (see below)
Conditions of Survival
Words that imply survival in regards to an interest create a condition precedent of
survival before the interest can vest in the surviving party
Examples
o
to A for life, remainder to his surviving children
o
to A for life, remainder to his children then living
o
Words that imply conditions of survival when giving gifts
issue
heirs
descendants

22

Transferability, Devisability, and Descendibility of Interests


Interest

Alienable inter
vivos?

Possibility of Reverter

Not at common law,


but usually in modern
law
Not at common law,
and usually not in
modern law either
Yes
Yes
Not at common law,
but usually in modern
law

Devisable by Will?

Descendible
Through Intestate
Succession?
Yes

Not at common law,


but usually in modern
law
Right of ReNot at common law,
Yes
entry/Power of
but usually in modern
Termination
law
Reversion
Yes
Yes
Vested Remainders
Yes
Yes
Contingent
Yes unless holders
Yes unless holders
Remainders
survival is a condition survival is a condition
to the interest vesting to the interest vesting
(i.e. to A for life, then (i.e. to A for life, then
to B if B survives A)
to B if B survives A)
Executory Interests
Not at common law,
Yes unless holders
Yes unless holders
but usually in modern survival is a condition survival is a condition
law
to the interest vesting to the interest vesting
(i.e. to A for life, then (i.e. to A for life, then
to B if B survives A)
to B if B survives A)
Table of Consanguinity (For Determining Priority in Intestate Secession)

23

Unenforceable Conditions in Deeds


Certain Restraints on Alienation
Complete restraints on alienation are almost always not enforced by courts
o
i.e. grant of fee simple determinable to A as long as he never transfers possession
of the estate
o
Rationale: courts want to allow the owner to make the most valuable use of the
land and to keep property on the market
Certain partial restraints on alienation
o
Restraints against conveying land to anyone other than the grantors family
By contrast, restraint against conveying affordable housing to any affluent buyer is
upheld (good public policy makes land available for the working class)
Conditions Designed to Break Up Families or Inhibit Families From Forming
24

Conditions that divest the grantee of the estate if they get married, allow certain family
members on, or unless they get divorced are usually not enforced
o
By contrast, conditions designed to shift property ownership on remarriage or to
allow other family members access to the property are upheld
Rule Against Perpetuities
Default Rule: An interest must vest within 21 years of the death of all lives in being
Life in Being = Any person alive at the time of the conveyance having an interest in that
conveyance
o
Default rule that for the creation of interests between corporations where the
interest doesnt specify lives in being, the interest must vest within 21 years of the deed
(Symphony Space)
Applies to:
o
contingent remainders, all contingent executory interests
o
class gifts
Note: when it is time for distribution, the class automatically closes
Alternatives to the RAP:
The Wait and See Doctrine - Wait and see if any of the interests vest, or become certain to
vest (or fail) within 21 years after the death of a life in being, if they dont, the interest is
void
Cy Pres Doctrine
o
If the interests would be void under the old Rule, the courts rewrite the instrument
so it will vest, sticking as close as possible to the grantors intent
Savings clause
o
Provides that an interest will automatically vest within the perpetuities period
Uniform Statutory Rule Against Perpetuities (used in California)
o
Wait and see for 90 years (will it vest?); A non-vested property interest is invalid
unless one of the following conditions is satisfied:
o
When the interest is created, it is certain to vest or terminate no later than 21 years
after the death of an individual then alive
o
the interest either vests or terminates within 90 years after the deed
Incorporates Cy Pres doctrine
Includes an irrebuttable presumption that a widow is a life in being and widows are
presumed to be the person married at the time of the conveyance
Policy for RAP
To ensure that parties are secure in knowing that they can invest in their property and
reap the benefits of their investments
Courts dont like a contingent interest to last seemingly in perpetuity

25

Landlord-Tenant
Type of Lease
Term of Years

Periodic Tenancy

Tenancy at Will

Tenancy at
Sufferance

Types of Leasehold Estates


Definition
Creation
Termination
Alienable?
Tenancy that
Express: To A Ends at the stated Yes, unless there
lasts for some
for 10 years
period; neither
is contrary intent
fixed period of
(any term over 1
party needs to
time
year must be in
provide further
writing to satisfy
notice
Statute of
Frauds)
Tenancy for
Express: To A
Ends by notice
some fixed
from month to
from one party
period that
month;
equal to at least
continues for
or
the length of one
succeeding
Implied: No
period (e.g. a
periods until
specified term in
months notice
either party gives lease and T pays
for a month to
notice of
L on a monthly
month tenancy);
termination
basis for rent
Exception: only
transforms
six months
tenancy into
notice is required
periodic tenancy
to terminate a
or
year-to-year
Landlord elects
tenancy. Some
to bind holdover states have now
tenant for an
shortened the
additional term
required notice
period
Tenancy of no
To T for and
Ends usually
No in fact, an
stated duration
during the
after one party
attempt to
that lasts as long
pleasure of L
expresses intent
transfer the
as both parties
(both T and L
to terminate
interest will often
desire
can terminate)
(though some
terminate the
Or
states require a
tenancy
To T for as
notice period i.e.
many years as T
30 days); may
desires (both T
also end by
and L can
operation of law
terminate)
(i.e. death of one
party, attempt to
transfer interest)
When a tenant
Tenant continues
Ends when
No
wrongfully holds
to occupy
landlord evicts
over after
premises after
tenant or elects
tenancy has
the lease
to hold the tenant
terminated
terminates
for another term;
26

converting lease
to periodic
tenancy

Definition Lease
Lease: An agreement where the owner of property (usually in fee simple) grants a tenant
the rights to possess a piece of property. Tenant has exclusive possession.
o
Any lease of more than a year must be in writing to satisfy Statute of Frauds
o
Sometimes there may be a conflict as to whether the agreement is a lease or
something else (i.e. does to T as long as he pays rent constitute a tenancy at will or a
fee simple determinable?) in this case, courts will consider the intention of parties
Assignments, and Sublets
Assignment: T transfers the remainder of the entire term to someone else (assignee)
o
Minority rule: transferring the remainder of the entire term but retaining a right to
re-entry of possibility of reverter makes it a sublease (American Community Stores)
Sublease: T transfers something less than the entire term (sublessee)
o
Case Law: American Community Stores v. Newman transfer of all but last two
days of lease constituted a sublease rather than an assignment, even though the
agreement gave sublessee the right to exercise the remaining option periods granted by
the Prime Lease
o
Minority rule: transferring entire term but retaining possibility of reverter or right
to re-entry also classifies as a sublease (American Community Stores)
Counterargument: Possibilities of reverter or rights to re-entry are not considered
estates in land, so this should be classified as an assignment
Obligations of Assignees to Landlord
There are two sources of obligations for the assignee
o
1) privity of estate applies only for the duration of the time you hold the land;
the covenants assumed are only covenants that touch and concern the land
General rule: Covenants to pay rent touch and concern the land
Privity of estate ends when the assignment terminates
Minority rule is that unilateral abandonment by the assignee (even w/o L
accepting abandonment) terminates the assignment and ends privity of estate
(Kelly v. TriCities)
o
2) privity of contract provisions of original lease apply to assignees only when
they expressly assume the obligations of the lease in the instrument of transfer from
lessee; there is no implicit assumption of the lease (Kelly v. TriCities)
A provision in the original lease that the assignee shall assume the terms imposes a
duty on the lessee to include this in the assignment, but does not automatically
mean the assignee assumes the obligations (Kelly v. TriCities)
However, assignee is deemed to have inquiry notice of any covenants in the lease
whether or not he agrees to fulfill the lease covenants
27

Obligations of Sublessees to Landlord


Very few obligations b/w sublessees and landlord
Sublessees lack strict vertical privity w/ L the sublease is a separate landlord-tenant
relationship with the main lessee
Usually, when sublessee commits waste or engages in nuisance on the premises, landlord
must hold lessee liable, who in turn must hold sublessee liable
Exception
o
Negative covenants that run with the land (i.e. obligation to refrain from
converting residential home into commercial business) are enforceable against
sublessees as equitable servitudes
Landlords treatment of assignments and sublets
Leases sometimes forbid assigning and/or subletting or forbid doing so w/o consent of L
Landlords Duties and Tenants Remedies
Duty to deliver possession: Two alternate rules
English Rule: Deliver to tenant not just right to possession but actual possession
o
Remedy: Tenant who is not given possession may:
Void Lease
Sue landlord for economic damages
accept possession with ensuing damages
o
Rationale
Landlord is in better financial position to deal with holdovers
Landlord has better knowledge of what the actual rules are
Landlord has better knowledge of whether there are holdovers on the day the lease
is supposed to begin
Tenants expectations in signing lease he doesnt expect to have to evict
trespassers on day 1
American Rule: Need only deliver to tenant only right to legal possession
o
Tenant has to bring lawsuit against someone else who refuses to leave the
premiseseven though
o
Remedy: Tenant who encounters a trespasser on his property may:
Sue for trespass and ejectment
Can get monetary economic damages
Can get equitable remedies (trespasser removed from premises)
o
Rationale
Tenant has to deal with trespassers on any other day, why not on first?
o
Case Law: Teitelbaum court applies American rule and holds that D landlord is
not liable to P tenant for not evicting holdovers in Ps apartment by the time Ps lease
was supposed to start
Duty to Uphold Implied Covenant of Quiet Enjoyment
Covenant b/w landlord and tenant that is implied in all leases residential and
commercial, written and oral
Duty: Landlord promises that the tenant shall have quiet and peaceful possession of the
premises for the term as against the landlord, anyone holding through the landlord, or
anyone with a title superior to the landlord
28

Remedy: In order to demonstrate a breach by landlord, tenant must show:


o
1) actual eviction; or
o
2) constructive eviction
To bring constructive eviction claim, T must 1) leave the premises and 2) show either a)
substantial interference with enjoyment of all or part of the property or b) substantial
interference with the ability to use the property for its intended purpose
o
L is liable for omissions/failures, not just Ls affirmative measures
L also responsible for other tenants acts if he can correct & fails to correct
T must inform L & allow reasonable time to correct
Bring cause of action if not fixed
o
Whats substantial inference? Considerations:
Purposes of premises
Foreseeability of the type of interference
Potential duration of interference
Nature & degree of harm caused
Availability of means to abate interference
Examples:
Incessant noise from neighboring nightclub that also leases from L (Blackett v.
Olanoff)
Failure to supply light, heat, power
Failure to install heating
Authorizing another tenant to obstruct the suing tenants light and air
Examples of actions that are not substantial interferences
Next door tenants engaging in illicit drug sales or prostitutions
Failing to repair leaking roof when it does not prevent T from carrying on his
commercial business (Wesson)
o
If he proves constructive eviction, tenant can get:
Release from the remainder of the lease
Economic damages
Punitive damages
Duty to Fulfill Mutually Dependent Covenants
Duty: Landlord must uphold any promises that were significant inducements to the
tenants entering the lease in exchange for tenant paying rent
Remedy: If the landlord does not uphold such promises, tenant can terminate the lease
o
Case Law: Wesson Ls failure to fix leaking roof does not constitute
constructive eviction, but because having dry space was a significant inducement to
Ts signing the lease so he could use the building for his printing business, Ls failure to
fix roof means that T can terminate
Duty to Fulfill Implied Warranty of Habitability (For Residential Leases)
Duty: Landlord warrants that he will maintain habitable premises for T to live in
o
Not waiveable/cant be contracted around
o
T must inform L & allow reasonable time to correct
o
What Constitutes Breach?
29

Cal Civil Code 1941.1


Lack of effective weather proofing
Broken windows and doors
A non-functional hot and cold water supply
Broken plumping or gas facilities
Broken heating or electrical system
Filthy or animal-infested building, grounds, and appurtenances
Floors, stairways, and railings in disrepair
**note: these conditions cannot have been caused by Ts lack of ordinary care
Remedies for T:
o
Sue for damages
Can include damages equivalent to difference between apartment in working
condition and apartment in present state
Can include damages for emotional distress if the disrepair is caused by gross
negligence on Ls part (McNairy)
Can include punitive damages
o
Cal Civil Code 1942.4: If public official has informed L of their duty to fix
premises and more than 35 days have passed since w/o the premises being fixed, T can
stop paying rent for period in which the apartment is not in working order and also get
$5K in damages
o
Repair and deduct T can fix the premises himself and deduct the cost of fixing
from his rent
o
If the breach is substantial enough to constitute constructive eviction, T can
terminate lease
o
**Note: It is not necessary that T leave premises (unlike constructive eviction)

Tenants Duties
Uniform Landlord and Tenant Act
Comply with building and housing codes
Keep premises clean and safe and dispose of garbage in a safe manner
Use all the facilities and appliances in a reasonable manner
cannot deliberately or negligently destroy any part of the premises or permit someone
else to do so
Cannot disturb his neighbors right to quiet enjoyment
Duty Not to Commit Waste/Duty to Repair
Rule of Waste
A tenants actions in the apartment constitute waste if he commits damage that
substantially and permanently injures the reversion
Rule tests
o
Whether he materially and permanently changes the nature and character of the
building (i.e. converting area into a hotel; removing some partitions and erecting
others) constitutes waste even if market value of property is enhanced
30

Especially likely that there is no waste when L can restore premises to previous
state fairly easily (i.e. if T removes old cabinets but stores them around)
Examples of Waste
o
Converting residential home to a factory
o
Destroying/modifying entire walls or utility systems
Not Waste
o
Sigsbee holding that Ts replacement of old cabinets with new ones in the
apartment did not constitute waste
o
Ordinary wear and tear
o
Ameliorating Waste
When the present interest holder's reason for making the changes:
Are a result of permanent, substantial change to the character of the
neighborhood has deprived the land of its existent form of productive use
And those changes would be made by a reasonable owner of the property in fee
simple absolute
Makes the "waste" non-actionable
Case Law: Melms v. Pabst Brewing - Twas allowed to raze the building when the
surrounding area became entirely industrial and locating a residency or a business
there would have been completely undesirable/unprofitable
Law of Fixtures
o
Determines whether, at end of term, tenant can remove articles affixed to the
property or whether they should remain to the landlord
o
If the property is a fixture, the articles are attached and cannot be removed
doing so would be waste
o
Court may rule a property a fixture if it was attached with the intent of becoming
permanent (from an objective standpoint)
o
Courts are hesitant to find property as fixtures (because tenants dont normally
intend to just improve the property for the landlords benefit)
o
Trade fixtures
Machinery used in businesses
Can be moved by the tenant regardless of the objective intent
o
Removal of an article that substantially damages the property is permissible under
the Restatement as long as the property is restored within a reasonable time
Duty to Repair
About whether T or L has duty to make repairs to property
o
This duty can be expanded or shrunk according to the terms of the contract, unless
statute provides that L cannot waive certain obligations
Failure of duty to repair constitutes permissive waste
o
If remainderman covers for tenant's failure to pay, tenant is liable to
remainderman for costs
o
Subrogation doctrine allows the remainderman to put a lien or mortgage on the
tenant's other property to cover for the costs
Insurance proceeds

31

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

Duty to Operate According to Terms of Lease


Commercial Leases: Implied Covenants of Continuous Operation?
o
Can sometimes be implied when the lease has no express provisions but stipulates
that T must be L a % of his revenues and includes a very low base rent
o
Case Law
Piggly Wiggly a lease from P landlord to D tenant supermarket that had substantial
base rent and said that the premises may be used for other lawful business
purposes did not imply a covenant of continued operation
Counterarguments: 1) Piggly Wiggly drafted lease; it should be construed
strictly against drafter; 2) only reason they werent using it was from preventing
competitors from getting the lot
Duty to Pay Rent
Destruction of Premises (Almost Exclusively Commercial Problem)
Traditional Rule
Even if whole premise is destroyed, tenant not relived of duty to pay rent
o
Idea was that people wanted land for its own sake rather than improvements

Unless tenant undertook risk of loss

Modern Rule
Complete destruction of premises terminates both landlord and tenants obligations
o
Exceptions
Was risk of loss explicitly allocated in the contract? This can change the result
Does tenant has an interest in the landlords insurance? If the tenant has no interest,
the landlord may have the right to terminate the lease in the event of substantial
damage
Rationale
o
Soil is not as important as the house or retail space on itso destruction can be a
basis for not paying rent
o
Impossibility of Performance
When it has become impossible for the landlord to provide what was leased for, his
duty may be relieved. And thus the duty of tenant to pay rent
Unless they contracted to shift risk
o
Frustration of Purpose
Applied when the purpose for which the lease is made is nearly or totally destroyed
during its term

32

Case Law Albert M. Greenfield v. Kolea T was renting two adjoining lots,
one to house cars and other to sell them out of. One is destroyed and the whole
purpose of the lease is unable to be performed Ts obligations were terminated
Landlords Remedies
What can the landlord do when the tenant does not pay rent?
o
1) Can evict, accept tenants surrender, and collect past due rent until time of
termination, plus any extra damages caused by the breach (Cal Civil 1951.2)
Under traditional view, this terminates any obligation on the part of the tenant
o
2) Can evict, find another tenant, and collect difference b/w the new tenants rent
(market value) and the old tenants rent (presumably a higher amount), plus any extra
damages caused by the breach this represents the expectation damages under contract
law (Cal Civil 1951.2)
o
3) Can continue trying to enforce the lease as it stands
What can the landlord do when the tenant stays in possession but does not fulfill the
obligation to repair?
o
Landlord can sue for specific performance
o
Landlord can sue for monetary damages to the reversion
However, L cannot sue for cost of repairs w/o terminating the lease and the lease
has not expired (Avalon Pacific)
Exceptions
when cost of repairs is less than the diminution in value to the reversion
when the landlord has already made the repairs and is seeking to get reimbursed
o
Landlord can evict tenant for breach of a dependent covenant or forfeiture clause
In event of abandonment by tenant
1) landlord can take back leased premises and accept surrender tenant has no liability
for any rent not yet due
2) landlord can ignore abandonment and continue to hold tenant liable under term of
original lease
o
Minority rule tenants abandonment does not require landlords acceptance to
constitute an end to the lease (Kelly)
3) landlord can re-lease to a new party and hold tenant liable for difference between the
rent left over in the original lease (presumably higher) and the new rent for the same
period
o
However, assumption of control over premises may be interpreted as accepting
tenants surrender, which can remove tenants liability
In the event of forfeiture by tenant and subsequent termination by landlord
Landlord can include provision stipulating that once the lease is terminated, they can rerent the premises to another party and recover from the tenant damages equivalent to
difference between the rent left over in the original lease (presumably higher) and the
new rent for the same period
Eviction (Unlawful Detainer Action)
Rationale
33

In common law, the landlord did not have this right absent an express termination clause;
the covenant was independent from the tenants obligations
o
Landlords resorted to conditions in the leases to give them the right to terminate
Fee simple determinable estates tenant holds the land until a condition happens,
then the possibility of reverter kicks in and the lease automatically terminates
Fee simple estates based on condition subsequent tenant holds the land, but if a
condition happens, the landlord has the right to re-entry/power of termination and
can take back the estate
o
Why would you choose a right to re-enter over an automatic termination?
Automatic termination may eliminate the power to collect any rent
Today, lease covenants are regarded as dependent covenants and the landlords power to
terminate is included in the dependent covenant
If tenant violates certain obligations (i.e. to use the premises as specified or to pay rent or
to not commit waste or nuisance, he no longer has a legal right to stay in the property
When Can L evict T (assuming T does not cure)?
Material Breach of a specific requirement/dependent covenant in the lease
Failure to pay rent
Waste
Expiration of a fixed-term lease
Refusal to leave after lawful termination of periodic tenancy or tenancy at will
Tenant abandonment
o
Though if tenant never abandoned, or the tenant can file a wrongful eviction claim
Eviction Process
1) Notice to evict must be given so that 1) tenant has opportunity to cure breach or 2) if it
is an incurable breach, they have notice that they must leave soon
o
3-day notices
Used when the tenant is unlawfully in possession or has materially breached some
dependent covenant in the lease
3-day notice to pay or quit
3-day notice to perform or quit
3-day notice to quit used for incurable breaches (i.e. severe nuisances such as
selling illegal drugs or weapons or endangering the safety of neighbors)
o
30-day or 60-day notices
Used by tenant to terminate leases of tenants who are leasing under indefinite
periods (i.e. week-to-week, month-to-month)
2) Summary Judicial Proceedings (if T does not cure)
o
resemble a trial, but they are much quicker
o
The only issue that is being litigated is whether the landlord has the right to
possession
Tenants Possible Defenses to Eviction Proceedings
Tenant never breached
T cured within necessary time

34

L breached implied warrantee of habitability (Knight v. Halsthammar, Green v. Superior


Court)
L was constructively evicted
T did not leave at end of lease due to emergency (i.e. sickness)
L waived notice to quit
L is guilty of retaliatory eviction
o
Landlord cannot evict in response to tenant exercising legal rights
o
Retaliatory evictions include:
Increasing rent
decreasing services
causing tenant to quit the rental property involuntarily
o
a tenant may not waive this right
o
Tenant must prove retaliation by preponderance of evidence
o
Landlord can prove good faith
o
Retaliatory Action must occur with 180 days of exercise of right
o
May only be asserted once in a 12 month period
o
Tenant would be entitled to compensatory and punitive damages
Eviction is due to discrimination (prohibited by federal and state law)
Disallowed Self-Help Remedies
Evicting a tenant by force is prohibited in CA judicial proceedings are the only way to
go
o
i.e. cutting off utilities, changing locks to prevent T from getting in
Forcible Entry/Unlawful Detainer
o
Forcible entry = using force to unlawfully enter a premises
o
Unlawful detainer = detaining someones property unlawfully
o
These remedies are prohibited even if the tenant has breached the lease or if the
landlord maintains a lien on the tenants property
o
Case Law: Jordan v. Talbot holding that L could not enter Ts apartment and
move her property to a warehouse and not let her re-enter her apartment even though T
was two months in arrears on rent and L had a lien on her property and a right to reentry in the event T was in arrears
Rationale: Goal is the preservation of civility and order
Using security deposit to pay off future rent that T has not paid off after terminating lease
(default rule) (250 LLC v. Photopoint)
o
However, such a provision can be included in the security deposit
o
L also always has the option of continuing the lease, not terminating, and then
holding T liable for the leftover rent

Concurrent Estates

4 types
Tenancy in Common
Each tenant has equal rights to possess the whole of the property, even if they own
different percentage share of property
35

o
Not to the exclusion of the other tenants
o
Each shares in the profits according to their ownership interests
Alienability
o
One's own interest is alienable and inheritable, new owner becomes tenant in
common with others
If no other form of ownership is specified in a deed of property to multiple people, the
presumption is that the people are tenants in common
o
Exception: Trustees are joint tenants with right of survivorship
Joint Tenancy with Right of Survivorship
Concurrent ownership but when one joint tenant dies, the interest in the property
remains with the surviving joint tenants; last man standing inherits the whole interest
o
Conceptualized as an extinguishment of a burden from the interests of the other
joint tenants rather than as the transfer of the deceaseds interest to the survivors this
is why creditors cant get after the interests of a deceased joint tenant
Requirements for Creating a Joint Tenancy with Right of Survivorship
Language: To A and B in Joint Tenancy with right of survivorship
o
Language important. There is a presumption toward tenancies in common
Four Unities (Traditional law)
o
Time Both tenants' interests must vest at the same time
o
Title Must be acquired by both in the same deed/will
o
Interest Both have equal shares of the same estate
o
Possession Both have right to possession of the whole property
New Rule (followed in some jurisdictions; alters four unities)
o
There can be a direct transfer from one person to himself and another to create
joint tenancy as a will substitute (rather than using a straw man)
The four unities would not allow this because the original transferors interest
would have vested earlier (fails time) and would have been acquired in a different
deed/will (fals title)
o
Proceeds can be dispersed according to unequal shares
o
Can agree that one has more rights of possession
Alienability of Joint Tenancies
Alienable during life but not after death because interest is extinguished by death
o
However, alienating your share severs the joint tenancy and turns it into a tenancy
in common with the remaining joint tenants
**Note: When there are more than 2 joint tenants and one transfers his interest, he
becomes a tenant in common with the remaining joint tenants, who are all still joint
tenants with each other
Case Law Smolen v. Smolen (p. 578): Holding that joint tenancy over a house
(pursuant to a divorce decree) b/w ex-spouses was severed when the man conveyed
his interest to a new trust
What Else (Besides Inter Vivos Alienation) Could Sever a Joint Tenancy?
Mortgaging against your interest (in title theory states
o
Lien theory states
Title remains with tenant and so there is no severance
36

Property is/is no longer subject to the mortgage upon death


Case Law People v. Nogarr (p. 574)
Man and wife separated but still had joint tenancy over property
Man gave his parents a mortgage on the house to accompany a promissory note
to pay them $6,440
Man died before he could pay back all the money
Govt. condemned the property the next year and the parents (mortgagees) said
they were owed $6,440 in compensation for their interest in the property
Holding: Mortgagees have no interest in property because the mortgage did not
transfer the interest but just created a lien on the mans existing interest; when
the man died the interest dissolved and his wife had the full interest in the
property
o
Title theory states
Title in fee simple determinable belongs to creditor, so debtor's interest is severed
and he becomes a tenant in common with the other tenants
Severing joint tenancy and converting interest to tenants in common
o
In some states, a joint tenant must do this by conveying his interest to a straw man
o
In other states, a joint tenant can sever and make himself a tenant in common w/o
a straw man
Murdering the other joint tenant
o
In some states, you (the murderer) would become tenants in common and the
other tenants interest would pass to the heirs
o
In other states, you would be deemed to be holding the property in constructive
trust for the heirs of the other tenant thus, you keep your interest but cannot profit off
of it
When one joint tenant leases to a third party
o
Old rule Lease serves as severance pro tanto for the term of the lease
Even if leasing joint tenant dies before lease runs up, lease must expire before the
joint tenancy resumes
o
New rule Lease does not sever joint tenancy
Thus, once leasing joint tenant dies, the lease terminates because the joint tenant
cannot convey a bigger interest than he has and his interest now remains in the
surviving joint tenants
Rights and Obligations Between Joint Tenants
Joint tenancy over frozen embryos (Davis v. Davis)
holding that frozen embryos are somewhere in between property and persons due to
the potential that they can become human lives
parents have equal interest in the future of the embryo
when parents disagree about what to do, interests of mother and father must be weighed
against the other
parents froze embryos for invetro fertilization and then divorced
mother wanted to give away frozen embryos to another family to birth/raise the children;
father did not want one of his biological children growing up in a family without his
biological father around
37

Court rules that the fathers interests in not wanting fatherhood imposed on him or in not
wanting to father a child that grows up in a different household outweigh the mothers
interests in having gone through the pain/effort of taking injections to produce eggs for
IVF
Thus, frozen embryos cannot be given away to another family

Tenancy by the Entirety (Married Couples)


Creation
Four unities + couple must be married when they acquire the property
o
Example: married couple buying a home
In some states, any transfer to husband/wife creates a presumed tenancy by entirety; in
other states, the presumption is a tenancy in common unless a tenancy by entirety (or
joint tenancy with right of survivorship) is stated in the instrument of conveyance
Elements
Right of survivorship
Unlike joint tenancy, tenants by the entirety cannot transfer their interests independently
they both need to agree to transfer
Limitations on severance
ONLY Divorce or agreement of parties severs it
o
For creditors to collect on it, both husband and wife must be liable, or they must
execute a mortgage
Community Property
Specific type of property in California
Just like tenancy by the entirety (must be property acquired by couples who are already
married), but it is devisable by will and leaves the devisee and the surviving spouse as
tenants in common
o
Example: Husband + Wife buy a house; upon death, husbands will states that his
interest goes to his son; the son and the widow now own the house as tenants in
common
Ouster of a Concurrent Tenant
No solid rule on what actually constitutes an ouster
o
Some jurisdicitons hold that telling concurrent tenant that you dont want them
on the place is an ouster, but some other jurisdictions hold that threatening to call the
police to have a concurrent tenant removed is not an ouster
o
some jurisdictions hold that changing the locks on a co-tenant is an ouster
o
Case Law: In re Estate of Hughes man owned a house as a tenant in common
with his wife; his attempt to get 100% interest in the property despite interest remaining
in his deceased wifes children (due to will) after she died constituted an ouster
Ouster can signify the beginning of adverse and hostile or open and notorious
possession for adverse possession purposes
Rights and Obligations Between Co-Tenants
Divvying Up Occupancy Rights to Property

38

Under CA law, tenants in common can establish separate agreements to provide exclusive
rights to occupancy for individual tenants over individual parts of a property (Tom v. City
of San Francisco)
o
Prohibiting such agreements would violate CA Constitutions right to privacy
Exclusive Possession By One Co-Tenant
When only one co-tenant is in possession of the property (because other voluntarily left)
o
Majority rule
Tenant in possession does not have a duty to pay rent to co-tenant
However, majority rule also is that tenant out of possession may also claim
credits/offsets for the value of the occupying tenants use that will reduce the
carrying charges (i.e. utility fees, taxes) on the property
When one co-tenant ousts the other co-teannt
o
Co-tenant in possession must pay the other co-tenant the reasonable rental value
of the property lost by the ousted co-tenant
Liability for Payments and Contributions on the Property
Carrying charges (taxes, mortage interest + payments on mortgate principal)
o
Each co-tenant must pay for their share of carrying charges
**Note: some jurisdictions hold that insurance + utilities are NOT carrying charges
o
The tenant paying for these may deduct their value from rent monies
o
If one co-tenant fails to contribute their fair share, the other can bring an action
for contribution against him
Mortgages
o
If one co-tenant pays a mortgage when it's due or past due, he can recover from
the others
o
If he prepays, he has to wait until it comes due
Improvements on the Property
No co-tenant has the duty to pay for improvements
o
**Note: repairs are NOT an improvement
No co-tenant can collect for improvements
o
Exception: they can only collect if the improvements increase the amount that the
property sells for; then, they can collect after the sale and according to the amount by
which the improvement increased the propertys value
Accounting (Sharing in Profits)
General rule: co-tenant does not owe money to other co-tenants for profits he makes from
sole possession/use of the property, but he owes them money from renting property to a
third party
But he can offset (deduct from what he owes the others) actual costs associated with:
o
generating and collecting the rent
o
amount expended on taxes, interest, mortgage principal, and insurance
o
advertising, management fees
o
actual amount spent on repairs, maintenance and utilities
o
Example: A is a cotenant with B and C. He makes $1500/month in renting
property to a 3rd party. He spends $1000/month in mortgage interest/principal payments,
39

$120/month in maintenance, and $80/month in repairs. He offsets these amounts from


$1500 to get $300/month, so he owes the B and C $100/month each
Co-tenant CANNOT demand contribution if his expenditures exceed his revenue, but he
can demand contributions for paying a) property taxes; b) govt. assessments; and c)
interest/principal payments on mortgage
o
Example: A is a co-tenant w/ B and C. He pays $3000 in taxes annually and
$5000 in mortgage payments annually. He rents to a 3rd party who pays him $2000
annually. After deducting the taxes and mortgage ($8000 total) from the $2000, he still
has a deficit of $6000. He can demand that B and C each pay him $2000 for their share
of taxes/mortgage
Co-tenant can recover an accounting equal to the sales proceeds attributable to the value
added by his improvement
o
The amount spent on the improvement is immaterial because we do not want the
other co-tenants to have to bear the cost of losing investments
o
But the improver should get an accounting if he increases the sale value because
we don't want to unjustly enrich the others when one did all the work
Tax sales
Most states hold that he's acting as a co-tenant and the others can remain co-tenants by
contributing their share of the taxes or mortgage within a reasonable time
Some states hold that if the others have the opportunity to bid, the purchasing tenant wins
it for himself
Adverse possession
Once notice is given, the statute starts running
Ouster can also signify the beginning of adverse possession
Partition
Any joint/common tenant has the right to bring a suit to partition property
Occurs when tenants cannot agree about how to use or dispose property
Types of partition:
o
Partition in Kind (Favored)
Each cotenant receives a parcel of equal value (or some parties can co-own parcels)
If some co-tenants receive more valuable parcels, they make payments to the
owners of the less valuable parcels, called owelty
Courts may order partition by sale because the value of the land would drop too
much if it was partitioned
Case Law: Wallace v. Daley court refuses to partition land in kind even
though P wanted to keep the house and give the other two co-tenants the almond
orchard (could have been possible that the almond orchards were worth very
little without the house)
o
Partition by Sale
All co-tenants must account for all unpaid carrying charges
Sales proceeds from the improvements will be allocated according to their value
o
Agreements prohibiting partition/alienation
Right to partition can be expressly or implicitly waived
Such agreements will be sustained if limited to a reasonable time
40

Otherwise, interpret all clauses limiting partition


If an agreement gives a right of first refusal to the other co-tenant, partition is
permitted after the other co-tenant is offered the selling co-tenants share and
refuses (Leg Investments v. Boxler)

Modern Real Estate Transactions


Overview: Components of a Modern Real Estate Transaction
1) Presentation of a Written Listing Agreement
2) Offer
3) (sometimes) prospective buyer may put down earnest money before the negotiations
start as a form of security
3) Acceptance
4) Escrow agent may be set up to serve as an intermediary between the buyer and seller
o
Buyer will be obtaining permits and financing agreements
o
Seller will be clearing defects from the title and making any necessary
improvements to the property
5) upon completion of each sides obligations, sale will close and the deed will be given
to the buyer
The Sales Contract
Requirements
Must be written: either formally or in a memo
o
Though personal property doesn't have to be in writing. It can just be handed
over
o
Exception: A party to an oral agreement (not satisfying SOF) who has made part
performance that indicates existence and general content of the agreement may seek
specific performance if two of the following are met:
Possession of the land
Making substantial improvement to the land
Payment of all or part of the purchase price
Description of property
o
Some states are stickier about description of property than others, and require a
full legal description. Others allow you to use just the address.
Identification of the parties of the contract
The price and manner of payment
Signature of person to be bound
Closing date
May have conditions that one party has to meet before closing
o
Subject to financing clause for example
o
May have condition that buyer should obtain necessary permits from authorities
before sale is completed
**Note: such conditions often imply a good-faith obligation on the buyers part to
seek out financing or permits

41

Case Law: Sechrest v. Safiol buyer cannot get his security deposit back from
seller because he did not met his good-faith obligation of attempting to procure
necessary construction permits from authorities
**An implied warranty of marketability of title is presumed in every contract for sale of
real property
o
However, this can be altered by the parties to simply be changed from marketable
title to insurable title, or even to no title at all
When Can a Sales Contract Be Rescinded?
Sales Contract can be rescinded for fraud, misrepresentation or material mistake
Titles
Definition of title:
o
the elements or attributes concerning possession
o
The default rule is that title in a sales contract is marketable
Marketable Title
Definition: a title reasonably free of doubt, which a prudent purchaser would accept
To prove marketability you have to prove:
o
1) that the outstanding claimants could not succeed were they in fact to assert a
claim
o
2) there is no real likelihood that any claim will ever be asserted
Rationale: We dont want buyers to be buying a lawsuit along with the property
Decided as a matter of law rather than a matter of fact
Questions of Marketability of Title
Still Marketable
o
Failure to Disclose Zoning Laws
o
Zoning Violation w/o Court Action
o
Building Code Violations (deal with premises rather than title)
Not Marketable
o
There is a probability that the seller does not own the title
o
Property is subject to an undisclosed encumbrance, easement, or servitude
Exception: highly visible easement (inquiry notice)
o
Undisclosed co-owner who has not joined in the contract for sale
o
Mortgages or liens on the property
o
Erroneous acreage etc.
**Seller should be given at least until the closing date to cure these defects in title
What if there is no record title?
o
Seller can show by clear and convincing evidence that he would win a quiet title
action
**Note: while filing a quiet title action prior to sale to establish good record title is
preferable, it is not necessary seller just needs to establish that he would win
Case Law: Conklin v. Davi seller has burden of proving title by adverse
possession in order to demonstrate marketable title
o
Additionally, seller may be required to furnish written evidence or some other
evidence which buyer can later use to defend his title if someone files a claim against
him
42

Buyer Remedies for Non-Marketable Title


If not marketable, buyer must alert seller and give reasonable time to cure defects.
o
Notice must specify nature of defects.
Buyer remedies before closing:
o
Rescission: unilateral unmaking of a contract
o
Damages: get money from the courts
o
Specific performance: make seller turn over land with abatement (reduction) of
purchase price
Insurable Title
Means that a reputable insurance company will insure the title at a regular rate
This will indemnify the owner of the land from liability in actions by other claimants
**is a lesser title than marketable title
Benefits to Title Insurance
o
Will ensure you that the property is not landlocked (impossible to reach by land)
o
Will insure you that the title is not forged
Perfect/Valid record title
A valid chain of title coming from the sovereign. Can trace from the beginning to the
person who is now selling the title
every seller should aim to convey perfect record title
Caveat Emptor and the Duty to Disclose
Caveat Emptor
Buyer Beware rule (Minority/Traditional Rule) (Used in commercial sales)
A seller owes no duty to disclose latent or patent defects
o
Exception: Cant fraudulently misrepresent in the Sales Contract
Duty to Disclose Material Latent Defects (Modern)
Seller has a duty to disclose defects which substantially effect the propertys value and
that the seller knows are not readily discoverable on the premises theory of implied
warranty of fitness
Applies usually only to residential premises and not commercial
Further states have adopted numerous statutes that restrict or expand these rights
o
California has adopted a checklist that sellers must provide
Controversial disclosures
o
Do not have to disclose whether past tenant had AIDS or was a convict
o
A party was once required to disclose that the house had ghosts
Sellers Remedies for Breach of Sales Contract
Legal remedies
o
Seller may keep the buyers security deposit (i.e. Sechrest v. Saviol)
o
Seller may keep land and get from buyer the [presumably positive] difference b/w
the contract price and the [presumably lower] market value of land on date of breach
Equitable remedies
o
Injunctions; discretionary with court; usually not awarded unless party had
behaved in an equitable fashion; more drastic because it operates on the person
requiring them to do/not do something
43

o
Specific Performance
Court may order the buyer to purchase the land from the seller in exchange for the
contract price this is often the result because each piece of land is unique, so
specific performance can be sought fairly easily for land
If seller can't give marketable title, specific performance requires transfer with
abatement (reduction) of price that buyer has to pay
Risk of Loss
Who bears risk of loss if property is damaged or destroyed before the time for closing?
Parties can specify this in the contract
Three different default rules
o
Majority rule: Buyer bears risk
Rationale: buyer gets benefits of appreciation (i.e. if oil is discovered on land
between signing of contract and closing)
o
Seller bears risk until delivery of possession or title to buyer, whichever comes
first (minority rule)
Rationale: The seller is technically the owner until the deed is delivered to buyer
o
3rd option: Buyer bears risk, but seller bears risk of damage by natural disasters
How does insurance impact this? Who gets the proceeds if only the seller has insurance?
Parities can also specify this in the contract
o
Courts split on default rules; some hold the seller gets the proceeds, others (most
American courts) hold that the buyer gets the proceeds so that seller doesnt get a
windfall
Equitable Conversion Doctrine
Purposes
o
Sometimes helps decide who bears the risks of loss
o
Sometimes helps decide what to do if one or both of the parties dies right after
sale is completed but before delivery or conveyance of the deed
When you have an enforceable right to an interest in that property, you have an equitable
interest in being treated as the owner of the property
o
What seller now has is the right to payment, as his interest is treated as personal
property
o
Buyer has the right to the conveyance, as his interest is treated as real property
Merger of Sales Contract Into the Deed
If closing does occur then the sales contract merges with the deed
Contract disappears unless parties provide otherwise
o
Exception: collateral promises in the sales contract are not merged and the seller is
still bound to them
Examples of collateral promises: builders warranty to construct a house in a good
manner; a provision giving seller option to repurchase the property
Not collateral promises (merged): promise by seller to place the mortgage it got
from the buyer subordinate to other mortgages
Financing a Real Estate Transaction
Can be done through many ways
o
Direct payment from buyer to seller
44

o
Mortgage
o
Installment land contract
Like a mortgage, but the seller, instead of a bank, provides the financing
Buyer pays seller in installments
In earlier times, if the buyer missed a payment he breached contract and therefore
he was left without property and seller kept all monies paid to him - seller got
windfall
Modern Courts give buyer time to cure defects and the seller should not be unjustly
enriched
Did seller deliver the deed to the buyer?
Was it delivered as a manifestation of an intent to make the deed operative and pass an
interest immediately?
o
Presumption that delivery was successful when:
Deed is handed to the grantee
Deed is acknowledged by the grantor before a notary
Deed is recorded
o
Once the deed has been delivered, it cannot be cancelled you have to draw up a
new deed to give it back
Did the deed contain a provision that it is to take effect only on the happening of a
condition?
o
One view: This is not delivery and the deed is void
o
Another: The deed is intended to be legally effective now, but passes an interest
subject to a condition precedent
This creates a springing executory interest in the grantee
Examples:
Good: "O to A, reserving life estate in O"
Maybe: "To A, effective on my death"
When "effective" means that it should not be executed on death, it's void
When "effective" means "effective to transfer possession," it's valid
What if grantor retains a power to revoke?
o
Majority view: Creates a present interest in grantee that can be revoked, because
if it's a written, signed, delivered deed, that's really strong evidence that the grantor
wanted it to be effective
o
Minority view: Grantor must surrender dominion and control for there to be
effective delivery
o
Case Law: Chandler v. Chandler transfer of deed to a bank with unequivocal
written and oral instructions to give the deed to grantors son upon grantors death
constituted a valid transfer; grantor never went to reclaim the deed from the bank and it
mentioned nothing about a power to revoke
Dissent the fact that the grantor could have revoked until he died meant that there
was never a transfer
Oral conditions are void
Was the deed given to a 3rd party custodian (i.e. an escrow agent)?
o
Is the escrow donative?
45

Once it's handed to the agent, it's irrevocable and the agent must deliver it on the
condition
Grantee has future interest
Technically springing executory (divests grantor of their interest)
But sometimes classified as a remainder
If it's revocable, no delivery takes place and it's void because it's not beyond the
grantor's control
o
Or is it commercial?
Written instructions make it irrevocable
Oral instructions
Majority view - are revocable (because of the Statute of Frauds) unless there's a
written contract of sale
Minority view are enforced because the deed is a conveyance not a contract,
and delivery is a question of intent, which can be proved by parol evidence
Elements of the Deed
Identification of the then-existing partiesCan only give to competent parties
o
Though an incompetent person can have a guardian manage the property as a
trustee
Description of the land
Granting clause Words indicating a present intent to convey
Grantors signature
Must have an acknowledgement to be recorded in the land records system
Deliver The Deed
Types of Deeds
General Warranty: Grantor warrants title against defects arising before and during the
time the grantor was connected with the land
Special Warranty: Grantor warrants the title against defects arising during the grantor's
association with the land, but no against defects arising before that time
Grant Deed: Californias name for a special warrantee deed; given a lot because people
usually buy title insurance
o
in CA, this is all that is required instead of a general warranty deed probably
because almost everyone buys title insurance anyway and this is generally more
effective than the grantors warranty
Quitclaim Deed: Grantor warrants nothing; the grantor merely transfers what tile the
grantor has, if any
Sheriffs Deeds: Given after foreclosure, these deeds do not give warranty
Reconveyance Deeds: Deeds transferring ownership from trustee back to trustor
Gift Deeds: Deeds transferring ownership for love and affection. Viewed with
skepticism as far as creditors are concerned
Void Deeds
o
Deed from a person judicially determined to be incapacitated
o
Forged Deeds
o
Deeds from un-emancipated minors
46

o
A deed purely testamentary in character
Voidable Deeds
o
Deeds that are not void on face but could possibly be voided if challenged in court
i.e. deeds from a person of unsound mind who has not been judicially determined to
be incapacitated
Covenants for Title
grantee may protect ownership by obtaining title covenants- a warranty that the grantees
title is good from the grantor. If there is no covenant of title, then seller is not liable if
title fails. Classified as present covenants or future covenants.
Present covenants: one which guarantees that a described situation exists at the time the
covenant is made. Covenant is either broken when it is made or never broken.
o
i. Covenant for seisin- means that grantor guarantees he owns the land he is
purporting to convey.
o
ii. Covenant of the right to convey- guarantees right to convey land. Same as
above except, grantor may have the right to convey and not be the owner.
o
iii. Covenant against encumbrances- grantor guarantees land has to mortgages,
tax liens, judgment liens, easements, restrictive covenants against the land.
b. Future covenants- covenants are not broken until the day of the conveyance.
o
i. Covenant of quiet enjoyment and covenant of general warranty- Purchaser will
not be disturbed in the future by the grantor or by some paramount claim existing at the
date of the conveyance. Occurs only when the coventee is evicted or disturbed in
possession. Not enough that there is a mere existence of a superior title.
o
ii. Covenant for further assurances- guarantees grantor will do such further
actions as are within grantors power to make the purchasers title good
How Mortgages Work
Rationale: mortgages provide security to the mortgagee and financing to the mortgagor
(the borrower)
When mortgagor (MR) borrows money from mortgagee (ME), ME has 1) promissory
note establishing obligation from MR to ME to repay him; and 2) mortgage document
giving ME security interest in the land to assure performances of the obligation
o
ME can assign the mortgage to someone else this should be recorded in the
registry of deeds
If the size of MRs loan is less than the value of his property, the difference (value of
property size of mortgage) equal the equity
o
This can be sold to other parties
If MR wants to sell the land while the mortgage is still outstanding, he must sell the land
to for the price of the equity. Sale can take three forms
o
Sale of the equity subject to the mortgage MR is still liable to pay back the
mortgage and buyer is not liable
o
Both buyer and MR are liable on the mortgage; if MR cant repay ME, then buyer
indemnifies MR
o
(preferred method): Novation buyer discharges MR from obligation to repay the
mortgage and becomes the sole obligor

47

Additional mortgages can be taken against the equity left over after the first mortgage
the interest will usually be hire to account for the added risk
Types of Mortgages
Purchase money mortgages often used in sales of real estate
Construction loan mortgages used when MR wants to buy land and build a house
o
ME makes loans in installments he only advances further money as the house is
being built (so that the amount loaned is never greater than the security interest)
Foreclosure
Used when MR fails to repay his loan to ME
Property is sold
o
Usually by judicial sale in most states
o
In other states, ME themselves can sell property
ME takes as much of the proceeds as is necessary to reimburse themselves, and gives MR
remainder
MERS Article
o
MERS is a company that keeps electronic records of who has title to mortgages;
was created to keep track of the various assignments of mortgages
o
Except MERS started foreclosing on mortgagors itself even though it often lacked
legal right to do so, since it did not own the mortgage itself
o
MERS claimed title to as many as half the outstanding mortgages in the country
Liens against property (other than mortgage)
o
**Note: Someone who forecloses on a mortgage generally wont do so until they
go through the records system to ensure that they have seniority on the property if
there were other liens before that have priority, the holders of those liens will get paid
off first the mortgagor who is behind in line doesnt want this
o
Attachments real estate is attached at beginning of legal proceeding to secure
payment for judgment
o
Judgment liens even w/o attachment, there may be a lien on your property after
judgment to ensure that you pay up
o
Taxes/Assessments
o
Mechanics liens contractors who perform construction on real estate have liens
on property to secure payment
o
Trust Arrangements used in states (i.e. CA) where a deed of trust functions as a
mortgage if you dont pay up, the trustee sells the land and pays ME what hes owed
o
Liens are generally paid off in the order in which they were created; there can be
several liens on a property at once
Surety
When the lendor doesnt think you might have enough credit on your own he makes
someone else sign on the loan for you and guarantee that you will pay off the loan
If you dont pay off the loan, the lender may be able to go after the guarantor of the
surety
Mortgagees Security Interest: Title Theory/Lien Theory
Traditionally: Title Theory
o
Banks owns deed to property subject to condition subsequent
48

Condition: You stop making payments


o
Acceleration Clause: When you fall behind entire balance comes due
o
Once you finish payment the condition becomes extinguished and the deed
destroyed
Modern: Lien Theory
o
Bank has a security interest in the property rather than any outright ownership
Essentially both work the same because Title-Theory States enforce in a similar manner

Gifts
Requirements for making a lifetime (inter vivos) gift
1) intent to make a transfer of an ownership interest in the property
o
Can be either a present interest or a future interest
o
The sentimental value and actual value of the gift are used by courts to infer intent
in the event of low information
High sentimental value to donor and great actual value = less likely that there was
intent to transfer ownership
2) delivery
3) acceptance
Land gifts
Intent must appear in writing signed by donor
Other gifts
May be expressed orally or inferred from the surrounding circumstances
Common questions in gift disputes
Was there intent to make a gift?
If there was no signed writing or handing over of the property, what type of action
happened from which you could infer that a gift was being transferred from donor to
done?
Were the formalities for a donative transfer fulfilled?
Doctrines limiting the scope of inter vivos gifts
1) gratuitous promises are not enforceable (you cant just promise to give a gift, you have
to actually make the transfer)
2) transfers taking effect at death (testamentary transfers) must be made by written will
o
Exception gifts causa mortis
Requirements for making a gift causa mortis (in contemplation of death)
1) decedent intended to make gift at the time
o
Case Law: Woo (p. 639) - because the check can be revoked until it is cashed, it
is better interpreted as a promise to make a gift in the future (which is unenforceable);
thus, there was no intent to make a gift
2) decedent apprehended death
o
Case Law: In Re Estate of Smith (p. 636) decedents checks to four people,
accompanied by a suicide note, where held to be gifts causa mortis even though the
defendants impending death was due to his own choice and even though he didnt
49

expressly state that he knew/believed he was dying soon and the death occurred within
a reasonable time thereafter it could be inferred from the suicide note
3) gift was actually or constructively delivered
4) death actually occurred
Delivery of Gifts
Constructive Delivery
Recognized as an acceptable means of delivery when the subject matter of an oral gift is
not available or capable of being physically handed over
o
Ex: giving keys to a car to hand over a car; disclosing location of buried cash to
make the gift of cash; giving combination of a safe to gift what was inside the safe
Is delivery of a check an effective way to deliver a gift of money?
Case Law
o
In Re Estate of Smith (PA) Yes
o
Woo (p. 639, VA) No; UCC holds that transfer of a check is not an assignment
of $$ on deposit
Symbolic Delivery
Delivering a symbol of the gift in order to deliver the gift
Ex: stock certificates to signify stock; title of the automobile to symbolize the vehicle
o
Beck v. Givens gift of sheep made by delivering bill of sale to donee, even
though donor retained possession of sheep during his lifetime
Revocability of Gifts
General rule: there must be an express power to revoke the gift
Gifts given to third party intermediaries with instructions to give to the donee
When express power to revoke is not needed
o
When the gift is given in contemplation of marriage or death
o
When gift is given to the third person as a trustee in a revocable trust
Otherwise, express power to revoke is needed if revocation can occur
Donative Intent What Can Be Donated?
Donation of a remainder with retention of a life interest (Gruen v. Gruen)
Is legitimate with respect to real property, chattels, stocks, bonds
Intent
o
Can be inferred as long as it is clear that the donor intended to transfer the
remainder interest to the donee
o
Different from a testamentary conveyance in a will because:
Gift of remainder is irrevocable; wills can be changed
Remainder interest vests immediately even if possession does not; under a will
neither title nor possession vests immediately
Postponement of possession occurs due to terms of the gift with donation of a
remainder interest/reservation of a life estate in the donor; postponement of
possession in a will occurs due to the nature of the instrument (will)
Delivery
o
Property does not need to be physically delivered when all that is being
transferred is the remainder interest
Acceptance
50

o
Oral and written statements of acceptance (including statements made to people
other than the donor) are sufficient to constitute acceptance
Joint Bank Accounts
Signature Card is Often Not Dispositive of Intent
Signature card usually states that any party to the account may withdraw all the funds and
that on ones death, the remaining funds belong to the survivors
Courts will admit other evidence of donors intent
true joint tenancy
o
When donor intends that other person can withdraw half the money in the account
and on his death the balance belongs to the other person
Will substitutes, non-probate transfers, pay on death accounts
o
Donor does not intend that the other should be able to withdrawn funds during his
lifetime, but upon his death, balance shall go to the other person
Convenience account or Power of Attorney account
o
Donor wants to give the other person access to pay donors bills only in the event
that the donor is incapacitated; balance does not go to the other person upon the donors
death
o
Banks dont like this because once the donor dies, the bank has to pay instead of
the other person the banks liability is thus higher
How much can the non-depositor withdraw when not paying depositors bills or after death of
depositor?
Jurisdictions following Uniform Probate Code withdrawal rights are based on each
partys net contributions
Other jurisdictions up to half

The Recording System

Resolves conflicting interest in property


o
When the same land has been conveyed to multiple people
o
When two people are disputing whose interest has priority over the other (i.e.
whose easement or lien or mortgage comes first)
o
If they both have interests and want to resolve whose interest is bound by the
others
When there is no applicable recording statute, first in time gets first in right
Recording acts determine validity and priority of conflicting interests
o
Potential purchasers can search the records to establish that the title is good
o
Laws punish those who fail to follow standard recording and searching
procedures
Who does the system help?
o
Purchasers
o
Sellers
o
Tax collectors
o
Creditors
o
Debtors
System is not mandatory but if you dont record your title to the land or a conveyance,
you could lose the land
51

Which Index to Select


To Discover If You Are Purchasing Land in Good Title
Use grantor-grantee index or tract index
When using grantor-grantee, search the person as a grantor (to ascertain if there are
competing conveyances that they made) and as a grantee (to see if they if/where they got
the property)
To Discover All the Land A Particular Person Owns in a County
Use grantor-grantee index
How to Use Indexes
Grantor-Grantee Index
Used to discover any grants that someone has made to others (grantor) or that someone
has received from others (grantee)
Useful for discovering all the real property someone owns in a county
1) Grab grantor or grantee index book with first letter of the grantor or grantees last
name
2) find the name
3) in grantee index, you will find the volume/page at which the deed to the grantee is
copied in full as well as a brief description of the property; in the grantor index, you will
find a description of any conveyances the grantor made
Tract Index
1) look at map of the county in recorders office to determine the number of the block in
which your land is
2) ascertain your lot number within the block
3) go to index volume for conveyances of land within your block and find the page that
references conveyances relating to your lot number
4) page has a list of the conveyances regarding your lot from the date the index was
established, as well as a reference to the volume/page where the documents are copied in
full
Combination Tract/Grantor-Grantee Index
1) First locate your numbered block on a map of the county
2) Go to index volume for that block; conveyances are indexed by the names of the
parties
Find the Root of Title
Refers to when the land was first conveyed, usually by the government to a private entity
Once you have worked your way back to the root of title, you can start working your way
forward to the present
Potential Obstacles With Indexes
No provision for indexing the passage of title upon death of the owner; if there is a gap in
the index, it is probably due to the fact that title has passed by descent or devise
How Much Protection Does a Purchaser Have Against a Prior Unrecorded Deed?
Depends on statute
Four kinds of statutes
Notice Statutes
BFP is protected whether they record their deed or not
52

o
Purchaser must be a bona-fide purchaser (BFP) they give valuable consideration
and have no notice of prior instrument
Thus, the previous title is divested as soon as the bona fide purchaser gets title to the
property, whether or not it is recorded
However, if purchaser has notice of prior deed, he does not get title
Race-notice statutes
Protects BFP only if they record their deed first
The type of notice in CA
Thus, a previous title, if not recorded, will be divested if someone else comes along and
gets title to the property through a bona fide purchase and then records the purchase
o
No title if you dont record first or if you had notice
Period-of-grace statutes
Protect BFP only if the prior grantee doesnt record prior deeds within the grace period
allowed by the statute
Race statutes
Protect the purchaser, regardless of whether he has notice or not of prior unrecorded
deeds, if he records his deed first
Distinction from race-notice is that, under race-notice, you do not have a claim of title if
you had notice at the time of purchase that someone else had title to the land; under a race
statute, you can get title to the land regardless of whether you had notice of a competing
claim as long as you record your title first
Types of Notice
Actual notice
purchaser actually knows or a prior conveyance
Record notice
when a prior conveyance is recorded, everyone is deemed to have record notice of its
terms
chain of title documents that are discoverable by a reasonable search of the records
o
You only have record notice of what is within the chain of title, not what is
outside
Case Law
o
Ryczkowski v. Chelsea Title
a landowner acquired land but did not record the sale; he then recorded an easement
for a power line to a power company
a few years later, he acquired title to the land
land changes hands and eventually P bought the land
P hired D insurance company to insure the title
Power line easement did not appear in the chain of title
When P found out about the easement, he sued D for failing to list the easement as
an encumbrance on his title
Holding: D is not liable b/c instruments executed by previous owners that were
recorded before the owner acquired or relinquished title are outside the chain of
title, so D is not liable for failing to discover such an instrument
o
Morse v. Curtis
53

Curtis was assigned a mortgage in 1881 and examined the registry and found a
conveyance from the owner of the land to his grantor, Hall, that gave the grantor
perfect record title
It turned out that there had been a prior mortgage to Morse that was not recorded
until 7 months after the mortgage to Hall was recorded in 1876
Morse claimed that Curtis had constructive notice of the prior mortgage b/c it had
been recorded by the time Curtis got the mortgage in 1881
Holding: Curtis was entitled to rely upon the perfect record title he found and was
not required to search further to see if the original owner had any prior unrecorded
deed
o
Buffalo Academy v. Boehm Bros
Buffalo conveyed a lot that was part of a larger tract of land to Boehm to discharge
a debt and said that if the title was unmarketable, they would give Boehm $60K
Boehm said the title was unmarketable b/c of 1) a uniform building plan which
restricts use of the lots on the land to residential purposes and 2) a covenant with
another grantee to not sell gas or build gas stations on the remaining lots
Holding: 1) there was no uniform building plan that restricted use; 2) the covenant
against building gas stations did not render the title unmarketable b/c it did not run
with the land and b/c Boehm would not be charged with notice of this covenant,
even if it was recorded and by its terms applies to all other lots
Rule: Purchaser only takes notice of encumbrances in the direct chain of title
o
Exception: Easements created by implication (Van Sandt v. Royster)
Inquiry notice
purchaser would know about a prior conveyance if they reasonably inspected the physical
property and made inquiries about the ownership based on what they found
Case Law: Sanborn v. McLean (p. 759)
o
Owner of a series of lots deeded several of the lots with the restriction that only
residences would be built on the lots
o
Afterward, he deeded D a lot without this restriction in the deed
o
D tried to build a gas station on their lot and P, an adjoining property owner, sued
to enjoin the construction of the station
o
Holding: Doctrine of implied reciprocal negative easements prevents D from
building the gas station
Doctrine means that an owner of the land grants land with restrictive easements on
it, these restrictions also apply to the land retained so that he cannot do on his land
what he forbids others to do
These easements run with the land
D had constructive knowledge of the easement, and hence inquiry notice, because
his abstract of title showed that all the lots around his own lot were residential;
inquiring about this fact would have revealed that his lot was subject to a reciprocal
negative easement
Complications With Notice
Easements or covenants recorded in the deeds of subdivided property
o
Dilemma: A may convey one of many subdivisions of his land to B B may be
granted an easement or covenant on the rest of the subdivisions; however, if C later
54

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

Easements
Definition
Right to use someone elses property for a particular purpose
Types of Easements
Appurtenant: When easement benefits the owner of the land in his use of the land and
thus runs with the land (Preferred Type of Easement)
o
Ex: one owner of land, A gives his landlocked neighbor B a right to cross his land
to get to a public road
o
When the nature of the easement is ambiguous, courts lean towards construing it
as an appurtenant easement
In Gross: Attached to the holder (Person or Entity)
o
Ex: A gives B the right to put a billboard on his (As) land. B doesnt even have to
own any land
o
Used to not be assignable; now transferring easements in gross is allowed
o
**Traditionally, covenant benefits in gross could not be enforced in equity (only
damages), but easement benefits in gross could be enforced at law and in equity
Exclusive: Very close to ownership of a fee simplecan exclude even servient estate
owner (Fairbrother v. Adams)
Personal: Non-assignable easements only the dominant owner can ever use them
Affirmative: Authorizes holder to do something
Negative: Prevents owner of servient estate from doing something
o
Traditionally courts did not like these: Only easements that were allowed were
against blocking windows, air, water, and removing support
o
Modern courts much more flexible: Like negative easements preventing one
owner of depriving another owner of a certain view
Profit: Right to enter property and remove some natural resource
55

o
i.e. the right to go onto someone elses land to hunt and fish on the land
License: Not an interest in land but a revocable right to use someone elses property
o
Thus, they cannot run with the land or with an interest in the land because they
can be revoked
o
In some cases, courts may declare an irrevocable license, but this is functionally
the same as an easement (Mund v. English)
Conservation Easements: statutorily created easement that combines elements of
easements and covenants to make an easement for the purposes of conservation
Assignability of Easements
At common law, easements in gross typically not assignable unless they are commercial
or parties agreed that it would be
o
Restatement: easements in gross assignable unless parties didnt reasonably
expect this
Appurtenant easements run with the land and transfer with deed
Divisibility and Apportionment of Easements
Appurtenant/ Exclusive in Gross can be divided and apportioned so long as it does not
overburden servient estate
In GrossDivisible and apportionable when assignable and when it does not cause any
additional burden to the servient estate (Orange County v. Citgo)
o
By contrast, when such a division/apportionment would overburden servient
estate, it may be impermissible
Case Law: Stanton v. T.L. Herbert profit to remove gravel from an island cannot
be assigned to three of the largest contractors in Tennessee
o
Common Stock Rule old English rule that when two or more people are
assigned a profit, the assignees must act jointly or as one stock in exploiting the
resource probably not followed in many jurisdictions anymore
How Are Easements Created?
1) By Written Instrument (Standard Way)
Must be in writing (Statute of Frauds) should record to protect
Manifest intent to create easement
Identify grantor and grantee
Describe the affected land
Signed by the grantor
Majority rule cant reserve an easement in a third party (stranger to the deed rule); you
can only at best reserve covenants in favor of a third party
o
Minority rule (followed by Restatement)- Can reserve easement in third party if
intent is clear; third party can enforce easement as a third-party beneficiary of the
contract
2) By Estoppel
An alternative way to create a servitude and to get around the statute of frauds.
A landowner may be estopped from denying the existence of a servitude, if, relying on a
permission to use the land, the licensee made substantial improvement on the land
56

o
Case Law: Mund v. English irrevocable license is created by court for P to use
water well on Ds property, and an easement to come across Ds land for purpose of
using the well is created, because P helped D set up the well, relied on Ds permission
to use the well for a substantial period of time, and made improvements to Ps property
(i.e. getting a loan and building a house, even though there was no other water supply)
based on Ds belief that he could use this well
Third Restatement describes two situations where an easement is created by estoppel
o
when landowner allowed a person to use the land and that person reasonably did
not foresee a change in position.
o
when landowner represented that the land was burdened by a servitude, it was
reasonably foreseeable that a prospective buyer would change his position based on its
existence, and the buyer detrimentally relied on this representation
Rationale
o
Equitable remedy designed to prevent unfairness or unjustness after someone has
spent money in reliance on action taken by the owner of the would-be servient estate
3) By Implication
Another exception to Statute of Frauds
Implied on the Basis of Prior Use
When if, before the tract was divided into two or more lots, a use existed on the servient
part which was reasonably necessary for the enjoyment of the dominant part and
which the parties intended to continue after the tract is divided, an easement may be
implied after the tracts are divided
o
Some other jurisdictions say easement must be strictly necessary for enjoyment of
dominant part
o
Quasi easement- when owner utilizes part of his land for the benefit of another
part and then conveys one part (the quasi dominant tenement) of that land to someone,
then it is considered an apparent, continuous, and reasonably necessary character, and
will become an easement implied on the basis of prior use
**An implied easement can also be implied for the grantors use if he grants
someone else the quasi-servient portion, but this is less likely, because courts
generally construe conveyances most strongly against the grantor
Case Law: Van Sandt v. Royster
original grantor had three lots numbered 19-20-4 (from west to east)
he built a drain running from lot 4 across 20 to lot 19 and then into a sewer west
of lot 19
drain was not visible it was underground
he then conveyed lot 20 by general warranty deed w/o reservations, and
eventually conveyed lot 19; one D succeeded to lot 4
P on lot 19 sued Ds on lots 20 and 4 when drain began to leak sewage onto his
property and they refused to stop using the train
P had no actual or record notice of easement
Court holds that there is an implied easement due to the quasi-easement
doctrine; moreover, P had constructive notice of a drain b/c the house he bought
was equipped w/ modern plumbing and his predecessor knew of the drain
57

Implied on the base of necessity


o
Can be created if the owner of a tract of land would have no access to a public
road without the easement. An easement of way over the lot with access to the public
road is implied
Case Law: Morrell v. Rice easement by necessity created over Ds property that
abuts Ps property so that Ps can access a public road from their landlocked land
o
Rationale: public policy dictates that access is essential to use, and the prevention
of landlocked property is desirable
o
Terminates if other access is becomes available.
o
Note: courts can say that the use of the easement cant deviate too much from the
initial use, while it should be ready to change with the times, it cant be too drastic of a
change, the normal black letter rule: an express easement can be used with changing
technology as long as it is serving normal development of the dominant estate
Government property
o
When the govt. conveys a parcel to a private entity which is completely
landlocked by federally owned land, an easement by necessity is often implied
o
However, when govt. is the one that is landlocked inside property it conveys to
others, courts are not likely to create an implied easement because the govt. could
always condemn land around it to create an easemnt
4) By Prescription
See in section on Adverse Possession
A prescriptive easement can be established if it is used according to terms of an intended
but imperfectly created servitude
o
Case Law: Paxson v. Glovitz
predecessors to P and D intended to create an easement that created a 20-foot
driveway from 10-ft wide portions of each partys property, but it was not written or
recorded and thus invalid
P and D used the driveway assuming that this easement existed for many years
When D tried to construct a fence on his side of the driveway, P sued an established
an easement by prescription due to his use of the driveway in an adverse fashion
for the statutory period
Rationale: Even if P had Ds permission, his use was actually adverse and hostile
b/c D actually owned his half of the driveway, and P was exercising use and claim
of right in a manner that was hostile to Ds actual ownership of that half of the
driveway
5) By Eminent Domain
See in section on Takings
Scope of Easements
The scope is as created by prior use or prescription, as the servient estate holder created it
when implied from necessity, as grant or reservation stated
Can increase with technology. Easement for buggy travel can mature to easement for car
travel
58

Use should not put an undue burden on the servient estate, but as long as no undue
burden is created, easement may be used for any lawful and reasonable use (Morrell v.
Rice)
o
Case Law: Morrell v. Rice easement created by necessity for access to public
road can also be used by Ps for the installation of underground utilities and can be
expanded for serving more types of residences on the property that just a single-family
residence
Owner cannot use it to benefit any estate other than the dominant estate
o
Courts however may get around this by not enjoining the use and instead granting
damages most of the time this added use does not create damages (Brown v. Voss)
Intensity: Use should not overburden servient estate (look to partys intent)
Relocation of Easements
Depends on Jurisdiction
o
RESTATEMENT: Servient owner can unilaterally relocate the easement so long
as he pays and the easement reasonably retains its intended purpose
Rationale
dominant estate holder would price gouge servient estate holder before giving
him permission to relocate due to the bilateral monopoly he has because he
knows the servient owner might stand to profit heavily from relocating the
easement; this is more economically efficient
also, easements are made to serve a particular purpose for the dominant estate
owner, they are not made to give him a veto over any type of use the servient
estate owner wants to conduct on his land
o
Case Law: MPM Builders v. Dwyer servient estate owner, who wants to further
develop its property according to a scheme that is impossible with easements in current
location, can relocate easements designed to provide neighboring dominant estate
owner with a right of way to a street because he will bear the cost and the new roads
will still lead to the same street
Common Law: only permissible by agreement of both parties
o
Rationale: allowing servient owner to unilaterally relocate would subordinate
property rights to economic efficiency and would invite too much litigation over
whether the relocation was reasonable or not
o
Case Law: AKG Real Estate v. Kosterman servient estate owner is not allowed
to relocate dominant estate owners easement, which is intended to provide him a right
of way to a public road, because the easement interferes with servient estate owners
development plan; easement still serves its purpose, which is giving access to the road
Changed Conditions doctrine does not apply b/c 1) easement still serves its
purpose; 2) changed conditions doctrine is meant to apply to conditions beyond
both parties control (i.e. natural disaster), not conditions resulting from voluntary
alterations to property made by servient estate owner
Use of Easements to Serve Non-Dominant Estates
General rule is that this is not permissible
o
Case Law: Brown v. Voss court holds that P cannot use easement over Ds
property, which is intended to serve one lot he owns, to also serve a second lot when he
wants to build a home straddling the two lots
59

However, court assigns damages at $1 because there is no discernible damage to the


servient estate from this sue

Duty to Make Repairs/ Improvements


Easement holder has right to make improvement to easement so long as the improvement
promotes use of the easement within the scope of the easement and does not
unreasonably burden the servient owners use or enjoyment of property
How Can an Easement Be Terminated?
Express termination
Impossibility of Purpose
o
Once the easement no longer serves any purposes, it may be terminated
Abandonment (stop use- manifest intent to abandon)
Merger (one party takes ownership of both dominant and servient estate)
Prescription
Estoppel
Misuse (rarely used)
Restatement allows a court to sometimes terminate easements in gross if you cannot
locate the beneficiaries

Covenants
How are Covenants Created?
1) By Written Instrument
Standard way of creating a covenant
2) By Estoppel
Rule: When a party, through his conduct, creates the impression that he will only use his
land in certain ways, and other parties detrimentally rely on this impression, a covenant
may be created against the party through estoppel
Case Law: Shalimar covenant for D to only maintain their property as a golf course
created through estoppel b/c the golf course was referred to in the advertising materials,
lots sold for higher prices, and owners relied on it; D real estate developers also bought
land from original developer with notice of the golf course, even if it wasnt recorded
since it was evident when they visited. The economic argument that golf course
operation is unprofitable doesnt qualify to frustrate original purpose of the covenant.
3) By Implication
Implied Reciprocal Covenants
Principle that when a common grantor conveys a subdivision of a property, the
restrictions placed on prior conveyances of subdivisions of the property apply to the
current (Sanborn v. McClain) conveyance if the grantee has actual or constructive notice
of such restrictions
o
You can prevent an implied reciprocal servitude from being created in the future
if, in the covenant over the subdivision of land you are selling off, you expressly denote
that the covenant does not apply to other subdivisions of the land
60

4) By Prescription
Covenants usually cannot be created by prescription
Exception is when the landowners believe they are bound by covenants and perform the
covenants for the prescriptive period
5) By Eminent Domain
Govt. can unilaterally impose restrictions on others land these may or may not require
just compensation (see Takings section)
When Does a Covenant Apply to Successors to the Estate?
Traditional Law for When Real Covenants and Equitable Servitudes Run With the Land
Requirement
Agreement in Writing

Real Covenant
Required

Intent
Touch or Concern
Horizontal Privity
Vertical Privity

Required
Required
Required
Strict vertical privity required
to enforce burdens (successor
to burdened estate got the
same estate as the original
covenantor), relaxed vertical
privity required to enforce
benefits
OK

Affirmative Burdens
Enforceable Against
Successors?
Notice

Benefits in Gross Enforceable


Against Successors?
Existence of a General Plan

Required by recording act


(actual, inquiry, or
constructive notice)
Usually ok, though first
Restatement said no
Not required

61

Equitable Servitude
Required, but implied
servitudes and servitudes by
estoppel do not need writing
Required
Required
Not required
Relaxed vertical privity
required (successor to
burdened estate had some
estate that the original
covenantor had) for both
burdens and benefits
OK, but a few exceptions
Required (actual, inquiry, or
constructive notice) though
North Carolina requires record
notice
Not allowed, but many
exceptions
Not required except in
Virginia and maybe a few
other states

Restatement Requirements for When Real Covenants and Equitable Servitudes Run With
the Land (There is No Distinction b/w Real Covenants and Equitable Servitudes)
Requirement
Agreement in Writing
Intent
Touch or Concern
Horizontal Privity
Vertical Privity

Affirmative Burdens
Enforceable Against
Successors?

Notice
Benefits in Gross Enforceable
Against Successors?
Existence of a General Plan

Real Covenant/Equitable
Servitude
Required, but not for
covenants created by estoppel
or implication
Required
Not required; covenant is ok
unless illegal or against public
policy
Not required
Required only for affirmative
burdens; however, lessees can
only enforce benefits to either
1) repair/maintain services to
property or 2) can be enjoyed
by lessee w/o diminishing the
value to the fee owner or
materially increase burden of
performing the covenant
OK, but lessees must only
perform burdens that can more
reasonably be performed by
person in possession of
premises than by the holder of
the fee simple
Required by recording act
(actual, inquiry, or
constructive notice)
OK
Not required

What does Privity Mean


Horizontal privity

62

o
Original definition was that there needed to be a landlord-tenant relationship b/w
covenantor and covenantee; was eventually expanded to other kinds of lesser estate
fee simple relationships
o
Modern definition: covenant had to be made simultaneously with a transfer of
property between covenantor and covenantee (can be a fee simple transfer, does not just
need to be a lesser estate)
o
Case Law: Runyon v. Paley there was no vertical privity b/w Runyons (P) and
D, who bought land subject to a covenant from another party (not the Runyons) well
after the Runyans bought their land from the same party
Vertical privity
o
Strict successor to covenant must have the same estate as the original
covenantor or covenantee
o
Relaxed successor to covenant must have some estate as the original covenantor
or covenantee
What Constitutes Touching and Concerning The Land?
General rule
o
A successor to the original covenantee can prove that the covenant he seeks to
enforce touches and concerns his land when it affects the enjoyment of his land
Distinction between running with the land and running with an interest in the
land
o
You can enforce a covenant against a successor to the original covenantor when
you can prove it touches and concerns the land of the servient owner by reducing the
enjoyment of the servient owners land
Examples
o
Covenants for the servient owner to only use the land for residential purposes run
with the dominant land as well (Runyan v. Paley)
o
Covenants for the servient owner to pay an annual charge to the dominant owner
for improvements to the servient estate run with the servient land (Neponsit)
Case Law: Neponsit successor to servient owners land must adhere to covenant
stipulating that the covenantor pay annual fees to P property owners association for
annual improvements to the property
o
Covenants for the servient owner to pay the dominant owner money in exchange
for an annual water supply do not run with the land (Eagle Enterprises)
Case Law: Eagle Enterprises v. Gross covenant that forced Ds predecessor to
pay Ps predecessor for annual delivery of water did not run with Ds land b/c 1) he
could just as easily construct his own water supply; 2) no land would be deprived of
water w/o the supply and the price of water would not be prohibitive w/o the
supply; 3) this resembles a contractual obligation more than a covenant
o
Covenants for the servient owner to only use his land for certain conditions and to
not sue the city (dominant owner) in the event of a landslide on the servient owners
property run with the land
Case Law: Lakeview Boulevard P successors to the servient estate cannot sue D
city because the covenant (as described in rule above) that their predecessors made
runs with the land b/c it limits rights ordinarily associated with ownership and b/c it
relates to soil which is part of the land
63

Unenforceable Covenants Due to Bad Public Policy


Restatement 3.1: the following covenants are not allowed
Arbitrary, spiteful, or capricious servitudes
Servitudes that unreasonably burden fundamental constitutional rights
Servitudes that impose unreasonable restraints on alienation
Servitudes that enforce unreasonable restraints on trade or competition
Unconscionable servitudes
Common Law
Covenants That Implicitly Constitute Restraints on Alienation
Impermissibly high transfer fees
o
A statute in CA caps the transfer fee payable to the dominant owner upon the
servient owners sale of his property
o
Rationale: Transfer fees (or quarter sales) discourage people from selling the
land because they have to pay a share of the sale to someone else this takes land off
the market
Regardless of whether the transfer fee is permissible, though, the transfer fee might
make it harder to get a mortgage under new Federal Housing Finance Agency
(FHFA) loans limiting the ability of Fannie Mae or Freddie Mac to purchase
mortgage loans on properties that are encumbered by transfer fee covenants
o
Counterargument
Something like a transfer fee may be permissible when they are designed to reach
acceptable social or economic ends (i.e. making land available for development)
Case Law: Kerley v. Nu-West covenant forcing P buyer of land from D developer
to pay 10% of all gross sales of the land to D was upheld b/c under AZ law, the
purpose of the agreement was to develop and sell land and it doesnt matter whether
the 10% fee was labeled as a payment for land or a payment for consulting service
Covenants That Contribute to Blight and Poverty
Covenant might not be enforced by a court when enforcing it would contribute to blight,
poverty, and endanger the health of nearby residents
o
Case Law: Davidson Bros. v. Katz & Sons (p. 1020)
o
P was a supermarket company and D had covenanted with P not to use Ds land
for a supermarket for 40 years after the 1980 date of sale
o
Closing of supermarket created a hardship for downtown city residents, most of
whom did not have cars
o
City housing authority acquired Ds land and leased the property to another D on
the condition that the land be operated as a supermarket
o
P sued to enjoin use of the property as a supermarket
o
Holding: court refused to enforce covenant b/c doing so would contribute to
personal hardship of the residents and inhibit ability of the city to revitalize the
downtown; there was no suitable alternative location for a supermarket
o
Possible Counterarguments:
You could require payment of damages instead of enforcing the injunction to allow
the beneficial but prohibited use to occur

64

If city is acquiring the land and then seeking to have the covenant terminated, it
could constitute inverse condemnation by taking private land for public use w/o just
compensation
Unreasonable Restraints on Trade
Covenant might not be enforced when it results in an unreasonable restraint on trade by
denying other producers the right to compete in the market or by forcing consumers to
buy a service/product they dont want
Case Law
o
Greenbelt Homes (p. 1026) holding that D cooperative housing development
unreasonably restrained trade in requiring its members to pay a mandatory 5.5% sales
commission on all sales, regardless of whether or not they used Ds real estate sales
staff
o
Fortner (p. 1026) SCOTUS holding that Ds requirement that housing
developers use prefabricated houses built by D as a condition of obtaining loans for
buying/developing land violated antitrust laws
o
Laguna Publishing (p. 1027) holding that management of a private, gated
community could not exclude publisher that would compete for ad revenue with one of
the communitys businesses
o
Guttenberg Taxpayers (p. 1027) holding that condominium association that
endorsed certain political candidates had to provide equal access to other political
organizations to distribute leaflets
Common interest communities have more leeway than developers to impose covenants
forcing subdivision owners to purchase certain services though (i.e. cable TV, street
maintenance, recreational facilities)
o
Common interest communities are managed by boards composed of the residents
of the communities, so residents can take their complaints to the board
o
Common interest communities are also set up with a stronger commitment to
preserving the property values in the community than a number of homes owned by a
developer
Unreasonable Design Controls
Covenant might impose design controls that allow the covenantee to deny the covenantor
of certain uses of their property for arbitrary or unreasonable reasons
Case Law
o
Rhue v. Cheyenne Homes (p. 1028) holding that architectural committee could
permissibly enforce a covenant that gave it power to deny a subdivision owners plan to
move a thirty-year old Spanish-style house into a community made up of modern
ranch-style homes because it would harm the property values of the other houses and
because the decision was not arbitrary
o
Prestwick Landowners (p. 1029) holding that the design covenant was invalid
because it did not provide specific guidelines under which an owner could determine
what was acceptable
o
Davis v. Huey (p. 1029) holding that developers enforcement of a covenant by
denial of a plan to set a house farther back in the lot than neighboring houses was
arbitrary and unreasonable

65

o
Sometimes, installation of certain satellite dishes and antennas may be inhibited
by a covenant, but federal legislation inhibits the enforcement of certain types of
covenants against satellites and antennas
o
A Washington state court enforced a covenant in which a homeowners association
held a family liable for painting the house purple without the associations approval
Unreasonable Restrictions on Household Occupants
Covenant may unduly restrict household occupants and personal freedoms of the people
in the household
Case Law
o
Nahrstedt (p. 1032) CA Supreme Court holding that a common interest
communitys restriction against maintaining pets in the communitys recorded
declaration was enforceable because it was reasonable because it protected the general
expectations of all condominium owners, kept costs down, and provided the other
owners with other reasonable benefits
o
Other restrictions might unfairly discriminate against unmarried couples and
violate the Fair Housing Act
o
Will be unenforceable if it denies a fundamental constitutional right
Impermissibly Discriminatory Covenants
Covenants enforcement may be racially discriminatory violate Equal Protection Clause
of 14th Amendment of Constitution
o
Case Law
Shelley v. Kraemer SCOTUS holding that covenants between homeowners that
were intended to run with the land and forbade homeowners from selling homes to
African-Americans could not be enforced without violating the EPC under the 14th
Amendment
Barrows v. Jackson SCOTUS holding that the white seller has standing to raise
the rights of the non-white buyer as a defense to damages against the seller for
violating racially restrictive covenants
Covenant may discriminate against the handicapped in violation of the Federal Fair
Housing Act
o
Case Law Hill v. Community of Damien covenant limiting use of a residence
to single-family occupancy does not apply to a group home for people with AIDS b/c
1) these people can be defined as a family because they give each other friendship
and support and public policy encourages people with disabilities to live together and
support each other in this way; and 2) enforcing the covenant would violate the FFHAs
provisions against discriminating against those with disabilities (due to disparate impact
the fact that not enforcing the covenant would have been a reasonable accommodation)
Covenant may discriminate on basis of familial status
o
Case Law: Simovitz v. Chanticleer Condominium Assn holding that FFHA
prevents discrimination by a housing facility against selling or renting to families with
children in housing unless the 55 and older exemption is met by showing that 1)
facility is designed specifically to meet the needs of seniors; and 2) at least 80% of the
units have one person 55 and over living in the house
Modification of Covenants
Retained Power of Modification in Original Covenant
66

Developers, homeowners associations, or owners of common interest communities often


retain the power to modify the covenant
o
Rationale is that when you buy into a common interest community, the
expectation is that you should expect to contribute to maintaining common areas for the
benefit of all community members
o
But courts often protect minority of owners or residents from modifications that
unfairly shift burdens onto them or benefits to the majority (i.e. changing basis for
allocating assessments)
o
Case Law:
Rick v. West (p. 1044) holding that developers right to modify a covenant against
non-residential use of the property by making exceptions in certain cases did not
extend to the non-residential use of 15 out of 62 acres when he tried to sell a
subdivision to a hospital
Evergreen Highlands Association v. West (p. 1050) holding that homeowners
association had right to create new covenant to impose an assessment on
homeowners of $50/yr for maintaining a 22-acre park open to all residents because:
1) amendment was made according to modification clause in original covenant that
P subdivision owner had notice of; 2) assessment was not unreasonable or
burdensome; and 3) purpose was to maintain common elements of a subdivision;
moreover, even in the absence of an express covenant; the association, as a common
interest community, would have the implied power to levy assessments against lot
owners to maintain common areas
P would have been a free rider if he didnt have to pay the assessment while still
being able to enjoy the park
Changed Conditions Doctrine
Restatement 7.10
o
(1) court can modify covenant when a change occurs that makes it impossible as a
practical matter to accomplish servitudes purpose; court can modify to permit the
purpose to be accomplished
o
(2) court can modify when a change occurs that makes the servient estate no
longer suitable for the uses permitted by the servitude (even if the purpose can be
accomplished); court can modify to permit other uses in order to preserve benefits of
the original servitude
o
(3) Exceptions: does not apply to modification or termination of conservation
servitudes held by public bodies and conservation organizations
Massachusetts Rule (most favorable to party seeking modification)
o
Injunction will not be enforced (only damages) in cases of:
Changed conditions
Even if there's benefit, if continuation of the restriction would impede reasonable
use of the burdened land for the purposes for which it is most suitable
enforcement would not be in public interest
generally the changes that occur to the surrounding area need to be changes that
significantly affect the purpose of the servitude
Case Law: Rick v. West (p. 1044) holding that developer could not modify self-imposed
covenant against non-residential use by selling 15 out of 62 acres of the property to a
67

hospital when a subdivision owner on the property had relied on the restrictions in buying
the lot and when the character of the neighborhood had not changed significantly enough
to warrant a modification
o
There had been changes, but most happened before 1956, when the covenant was
imposed
o
There had been two commercial establishments since that had not reduced the
value of the covenants because those establishments had not created a hassle for the
defendants at all
Termination of Covenants
Case Law
Westwood Homeowners Assn v. Lane County (p. 1058)
o
Holding that when the D county acquired title in a tax foreclosure sale to fifteen
lots in a unit development for nonpayment of property taxes, the acquisition did not
extinguish the lien that P homeowners association had against the property due to
unpaid assessments to the homeowners association
Extinguishing the servitude would impair the value of the entire subdivision
Moreover, the buyer in the tax foreclosure sale gets the benefits of the covenants, so
it is only fair that he should also assume the burden of the assessment fees
OR law favors common interest communities b/c they are 1) more efficient; and 2)
reduce the burden on the city for levying taxes to maintain parks and recreational
areas and other public services (since this is done by the homeowners association
itself)
Changed Conditions Doctrine
Restatement 7.10
o
(1) court may terminate servitude when a change occurs that makes it impossible
as a practical matter to accomplish servitudes purpose and there is no practical
modification that would allow the purpose of the servitude to be accomplished

Takings
Eminent Domain: Defintition
Defined as the power of the state under the 5th/14th amendment of the Constitution to take
control, ownership, and dominion over private property provided that:
o
1) there is a public purpose for the state taking the property
o
2) the state pays just compensation to the property owner for the land it takes
When is Eminent Domain Permissible?
Conventional Public Uses
Building schools, roads, bridges, airports, railroads, etc.
Private Use (state briefly controls land and transfers it to private hands) that serves a
public purpose
Economic Revitilization/More Tax Revenue
Kelo v. New London private land is taken (the land is not blighted, it is just in a
depressed city) to build a Pfizer plant as part of a redevelopment scheme; SCOTUS
holding that the increased tax revenue and economic revitalization to the depressed city
constitute a public purpose that justifies the taking; the city
o
Court is deferential to government conclusions they dont require clear and
convincing evidence of an economic benefit but give local governments broad latitude
68

o
Counterarguments: 1) creates a slippery slope where any time someone is not
using their land in the most economically productive way, the govt. could take it to give
it to a private property that would use it more productively; 2) gives undue influence to
private corporations, who can dictate the scope/nature of the taking of the private
property of those who are economically less powerful; 3) has a disparate impact on the
poor and other politically powerless people who cannot fight back against govt. takings
(this is why freeways run through poorer areas of LA and not Beverly Hills)
Berman v. Parker SCOTUS holding that its acceptable to condemn land in a blighted
area of Washington, D.C. in order to transfer it to private properties for the purpose of
urban renewal/economic redevelopment
Breaking Up Land Oligopolies
Hawaii Housing Authority v. Midkiff SCOTUS holding that state could use eminent
domain to transfer fee title from lessors to lessees; the small number of landowners who
owned a huge % of Hawaiis land skewed the housing market and distorted prices
Facilitating Entry Into Specific Markets
Ruckelshaus v. Monsanto SCOTUS holding that EPA could take trade secrets submitted
by a prior pesticide applicant to evaluate a subsequent application because sparing future
applicants the cost of time-consuming research eliminated a significant barrier to entry in
the pesticide market and thereby enhanced competition
Poletown Neighborhood Council v. City of Detroit Michigan case that allowed Detroit
to condemn areas in a Polish-American neighborhood to build a GM plant because jobs
created and expansion of the industrial base would serve a public purpose
o
GM basically picked out the exact scope and nature of the taking and made no
commitment to stay for an extended time
o
This case has subsequently been overruled
Preventing an Economically Valuable Company from Leaving the Area
City of Oakland v. Oakland Raiders holding that city of Oakland could permissibly
condemn the Raiders football team to keep them from moving to LA; however, this
taking was later determined to be invalid under the Commerce Clause
Possible Constitutional Limits
When the public purpose is a clear pretext for benefit to the private party that will
subsequently control the land (Kennedys concurrence in Kelo)
Various Statutory Limits
California land cant be taken unless the land itself is blighted
Zoning Ordinances
Rule: Are constitutionally valid uses of the states police power as long as they are not
arbitrary or unreasonable and there is a legitimate government purpose (rational basis
test)
o
If the validity of the classification is debatable, courts defer to the legislature
o
Exception is when there seems to be a suspect class (i.e. a racial group) singled
out by zoning laws
Rationale: Zoning ordinances are often essential to promoting public health, safety,
morals, or welfare; example: ones unrestricted use of his own land (i.e. building a
factory) may destroy the area for different uses of land (i.e. nearby residential homes)
69

o
Moreover, the property owners interests are represented in their local
governments this separates zoning from nuisance laws
Case Law: Village of Euclid v. Ambler Realty (p. 1115) SCOTUS holds that zoning
ordinances that imposed use, height, and area restrictions and reduced P realtors property
to 25% of its original value were valid exercises of the states police power and did not
need to come with just compensation
When Does Govt.s Permanent Physical Occupation of Land Constitute a Taking?
Permanent Physical Occupations Absent Any Benefits Conferred by Govt.
These are automatically takings
Rationale (Loretto)
o
Violates every stand of property rights
Right to possess you have no ability to possess or exclude someone from an
occupied space on your property
Right to use you cannot even make nonpossessory use of occupied space
Right to dispose of property even if you dispose of occupied space, the new
purchaser will also be unable to use that occupied space
o
Represents complete dominion and control over property
o
Avoids difficult line drawing problems (i.e. permitting someone else to install a
huge swimming pool on the rooftop is a taking, but if smaller installations were not,
where would you draw the line?)
Case Law: Loretto v. Teleprompter SCOTUS holding that govt. statute requiring
landlord to permit installation of a 30 ft. cable and two 4-inch square boxes on his roof
was a taking
Exceptions
o
State laws requiring landlords to provide tenants with many kind of access
services and appliances i.e. sprinklers, smoke alarms, running water, lighting, door
bells, fire escapes, mailboxes, etc.
Rationale for the distinction: In Loretto the landlord actually had to let a third party
come onto his premises and install its own cable box rather than having control over
the item (i.e. deadbolt, doorbell) installed on his premises and being able to install it
himself there seems to be more of an invasion in the former case
Unilaterally Imposed Easements on Private Land (Opinion of the Justices)
Exactions Conditioned on Permits Granted by the Government
Rule
Main rule: A governments conditioning a permit for use of land on the landowners
agreement to a regulation that significantly restricts or permanently occupies the land is a
taking when there is no substantial nexus between the condition substituted for denying
the permit and the end that would be advanced by denying the permit (Nollan, Dolan)
o
Rationale it is legal for the govt. to deny the permit altogether for reasons
relating to the public interest when the use of the permit would endanger that interest;
but when a condition is imposed that serves an interest which the use of the permit
would not endanger, this would allow the government to make an end run around the 5th
Amendment by forcing landowners to agree to takings in exchange for unrelated
permits (Nollan Scalia majority opinion); this would equate to a denial of substantive
due process under the 5th/14th amendment
70

o
Case Law: Nollan v. California Coastal Commission SCOTUS holding that the
governments conditioning the grant of a building permit to P on the grant of a public
easement over the land would constitute a taking
Rule Application: interest endangered by use of the permit = view of the
ocean/beach; interest served by the easement = walking across the beach; result =
no nexus between the two interests
Corollary to the rule: there must be a rough proportionality between the impact of the
dedication and the extent of the impact of the dedication, even if there is a nexus between
the interests (Dolan, Rehnquist majority opinion)
o
Case Law
Dolan v. City of Tigard SCOTUS holding that conditioning the grant of a permit
for expanding/redeveloping a plumping/electric store on the dedication of part of
the property in a floodplain for a storm drainage system which doubled as a public
greenway (path that the public can go through) and the dedication of another strip
of land for a pedestrian bicycle pathway was a taking b/c these dedications were
disproportionate to the impact caused by expanding the store
A private greenway could have been established to maintain a storm drainage
system as long as maintenance workers could have come on, but it was
disproportionate to establish a public greenway where people could also come
and use the area for picnicking
Counteargument: Stevens dissent notes that we dont know the monetary harm
to the landowner from these dedications; the dedication may have actually
increased value to land (potential customers going by the store, no tort liability,
maintenance, or tax liability for owner); this amounts to judicial micromanaging
of legislative decisions
Ehrlich v. Culver City (1996) California Appellate Court holds that requiring a
recreation fee of $280K in exchange for granting an application to replace a
commercial recreation center with condos is an exaction that is disproportionate to
the impact of the conversion, as the recreation center was already failing
commercially
Limits to the rule
o
does not extend to denial of permits to build, only to exactions
Case Law
City of Monterey v. Del Monte Dunes (1999) SCOTUS holds that rough
proportionality test does not relate to complete denial of permits; however, the
Court upholds a verdict in favor of the developer because there was no
reasonable relation b/w the denial of the permit and a legitimate public
purpose
Ehrlich v. Culver City (1996) California Appellate Court holds that requiring a
public art fee of $33K in exchange for granting an application to replace a
commercial recreation center with condos is a form of aesthetic regulation and
not an exaction
o
Does not apply to determining whether anything is a taking per se (proper rules
are ones like the permanent physical invasion, regulatory taking, land-use exaction

71

rules, etc.) but only to when a condition imposed upon the discretionary grant of a landuse permit is a taking (Lingle v. Chevron)
Case Law: Lingle v. Chevron (2005) SCOTUS holds that the substantially
advances a govt. interest test should not have been applied in lower court
determining that the govt.s imposition of rent controls on owners of gas stations
rents charged to lessee dealers was a taking
substantially advances is a substantive due process question, not a takings
question
As long as theres a rational basis, you go to the takings question
When Do Govt. Land Use Regulations Constitute Takings?
Rough Factor Test for Determining Whether Something is a Regulatory Taking (Penn
Central Transportation Co. v. NYC)
1) economic impact of taking
2) diminution in value to property owner/can the property owner still get a reasonable
return?
3) has regulation interfered with investment-backed expectations
4) character of the govts action (including whether there is a physical invasion)
5) purpose of the governments action
6) is the regulation part of a public program adjusting the benefits and burdens of
economic life to promote common good
7) is the property owner being singled out to benefit the rest of the population?
Regulatory Takings
Regulations That Almost Completely Eliminate the Propertys Commercial Value
Case Law: Lucas v. South Carolina Coastal Council (p. 1168) SCOTUS holding that
state restrictions on building habitable structures on Ps plot of land rendered his land
valueless and was thus a taking because the prohibited action was not an action that
would constitute a nuisance under common law
o
Counterarguments
1) common-law nuisance restrictions are far too narrow to confine a states power to
regulate w/o compensation
2) nuisance law is too complicated and ambiguous
3) this freezes the state common law and deters courts and state legislatures from
altering nuisance law when it becomes outdated
4) we should leave it to legislatures, not 19th century judges, to determine when a
use is so harmful that it must be prohibited without compensation
5) how do you calculate when something has been rendered valueless? This is
subjective and depends on the denominator
6) it is arbitrary that you would not compensate anyone whose property is
diminished 95% but compensate fully someone whose property is diminished 100%
7) courts may get around the new rule by redefining the denominator
8) investors and developers may take advantage of the Courts new rule by making
the estates and rights as small and specialized as possible (to reduce the
denominator so that any restriction takes away the entire right)

72

9) rule creates a moral hazard by insuring property owners against certain land
use regulations (after which they will need to be compensated); this encourages
overinvestment and building anywhere despite the risks (though you could say that
FEMA already provides this insurance by paying people when their houses get
leveled by coastal floods)
10) hard-line rules when unnecessarily tie the hands of zoning commissions who
must deal with complex problems
Case Law: Pennsylvania Coal Co. v. Mahon SCOTUS holds that PA statute which
forbids mining that causes subsidence of houses resulted in a taking of the coal of a coal
company which reserved a right to mine the coal underneath the house of grantees it had
deeded land to
o
Mining of most of the coal was now commercially impracticable; it had no value
remaining in the ground so the regulation had nearly the same effect as appropriating or
destroying it
o
**Some amount of regulation is ok, but this went too far and constituted a taking
o
Holmes also notes that the public benefit here isnt high enough
o
Denominator Dispute
Argument in favor of calling it a taking (Holmes) is that the property that is
impacted (the % of coal that cannot be mined) is the only property that is relevant to
the analysis of whether a taking has occured
Argument against calling it a taking (Brandeis) is that the property must be viewed
in the whole there is still coal underneath the house that can be mined, so the
entire value of the property has not been eliminated
Regulations Where the Govt. Devalues Property Through Its Own Use of the Property
Case Law: U.S. v. Causby SCOTUS holds that govt. flying planes above Ps chicken
farm, which made operation of the farm impossible, constituted a taking b/c the govt. was
not merely reducing the value of the property but was also using it for its own planes
Not Regulatory Takings
Use Restrictions That Preserve a Reasonable Return on the Property and Are Part of a
Reasonable, Comprehensive Plan
Rationale: Govt.s ability to promote public health, safety, morals, and general welfare
would be severely inhibited if they had to pay property owners for every such law which
diminished their property values
Case Law: Penn Central Transportation Co. v. City of New York SCOTUS holds that
NYC Landmark Law which designates Grand Central Terminal, owned by P, a
landmark, and prevents P from constructing an office building above the terminal, is not a
taking
o
Property was devalued but P could still make a reasonable return by using the
property as it was being used in the present
NYC also gave P transferable development rights to 8 parcels in the vicinity of the
terminal
o
The Landmark Laws were also comprehensive and did not single out P but
applied to over 400 individual landmarks in the city, many of which were close to the
terminal
73

Destruction of Property that is Necessary to Save More Valuable Property


Case Law: Miller v. Schoen SCOTUS holding that a state order that P destroy his
diseased cedar trees to prevent disease from spreading to an apple crop was not a taking
that required just compensation
Temporary Physical Invasions
Case Law: PruneYard Shopping Center v. Robins a shopping center had to let citizens
come onto the premises for the circulation of petitions; they also had not demonstrated
any financial loss from allowing the citizens on the premises
When Do Judicial Decisions on Property Rights Constitute Takings?
Rule
When a court invalidates the recognition of a previously existing private property right, 4
SCOTUS justices (Scalia, Roberts, Thomas, Alito) have held that the ruling constitutes a
taking from whoever previously held that right (Stop the Beach v. Florida Dept. of
Environmental Protection)
Challenger has the burden of showing that the property right previously existed
Case Law
Stop the Beach (2010) SCOTUS holds that there was no taking by FL Supreme Court in
holding that Ps were not entitled to just compensation after the govt. re-classified the
boundary line to their waterfront property and cleared out land below the line through the
process of avulsion because Ps never had littoral property rights to land that the state
cleared out through avulsion (sudden additions to the land); only rights to land cleared
out through accretion (gradual and imperceptible additions to the land)
Hypothetical
o
What if a state court invalidates a common law right to publicity? Would they
have to compensate people for taking away this right?

Hostile Acquisition of Property


By Conquest
Rule: Acquiring property by conquest gives the conqueror exclusive title to the property
Case Law: Johnson and Grahams Lessee v. McIntosh SCOTUS holding that the
British govt.s discovery of the land in their colonization of the present-day U.S. gave
them title to the Indians property; when the U.S won independence it got clear title to the
property from Britain; thus, Ps claim to title of the disputed land (which they had
allegedly acquired from the Indians) was invalid and the land belonged to D, who had
been granted title by the U.S.
o
Policy effects of this case: Because Indians were merely considered occupants
rather than holders of the title, they could not transfer title to other private parties; thus,
U.S. govt. could just buy out their occupancy at bargain-basement prices (because
govt., as holder of the title, was the only one who could bid) and then grant land to
different private parties
By Adverse Possession
Requirements for Adverse Possession
1) Actual and exclusive possession
o
you must not only be asserting a right to possession but asserting a right to
exclude others
o
does not require living on the land at all times
74

o
you must use all the land that you are claiming possession over, unless you have
color of title then you are said to be in constructive possession of everything in the
title
o
Case Law: Ewing v. Burnet - Burnet used the property as a gravel lot, leased it,
excluded others, and brought actions for trespass against those who entered the land,
and was able to establish AP
Other examples: Making improvements on the property (i.e. building structures,
planting non-indigenous trees) these are all steps that show that someone who is
not a possessor is making use of the property as if it is their own
2) adverse or hostile possession
o
possessor must use the land in a way that violates the rights of the owner
i.e. a tenant acting like a tenant will not establish adverse possession against the
landlord
3) claim of right
o
Possessor must act in a way equivalent to being the owner of the land
Ex: paying taxes is often crucial to establish this CA requires paying of taxes for
adverse possession claims
By contrast, acting only like a hunter-gatherer on the land may not be enough to
establish claim of right (Tee-Hit Ton Indians v. U.S.)
o
Majority rule: whether adverse possessor thinks they had title to the land the
whole time or not is irrelevant
Minority rules
Maine doctrine adverse possessor must realize they are taking someone elses
property
Criticism: this rewards bad-faith possessor and hurts good-faith, mistaken
possessor
Good faith rule adverse possessor must think they have possession the whole time
and be acting in good faith
Criticism: inhibits adverse possession of land which owner doesnt pay attention
to at all but which everyone else knows he owns
4) open and notorious
o
it must be evident that adverse possessor is claiming right he must fly his flag
visible signs that you are claiming possession are often helpful in meeting this
element
however, a random sign (i.e. the occasional sign) that can barely by found on a
huge piece of land may not constitute open and notorious possession (Tee-Hit
Ton Indians v. U.S.)
o
Rationale
Serves to give owner notice that someone is trying to establish adverse possession
However, notice just needs to be constructive, not actual it is immaterial whether
owner learns of adverse use
o
Whether the actual owner knows they have title during the period is irrelevant
what matters is whether the owner has notice of the adverse possessors use (Lawrence)

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Moreover, adverse possessor has no obligation to reveal to the proper owner that
they own the property they can even conceal this fact
5) continuous possession
o
Adverse possessor need not stay there themselves the whole time, they can lease
the land out to tenants as long as they are still acting like the owner (Lawrence)
6) parts 1-5 must happen for the entire statutory period until the statute runs (statutory
period is often 20 years but can be specified by state statute)
o
Statutory period continues to run even after actual possessor transfers title
Rationale: Public policy reasons; no one would adversely possess land if they could
potentially lose it every time a new person gets the legitimate title and is still within
the statutory period
This would allow owners who have missed the statutory period to evade the
statute by selling the title to someone else and having the new owner effectively
bring suit on their behalf
o
Tacking
When one adverse possessor transfers his or her interest in the property to someone
who continues the adverse possession, the second adverse possessor can tack on
the first adverse possessors period of possession to fill the necessary statutory
period
It is difficult to establish a transfer when you dont have legit title, so tacking
is usually accomplished when the transfer happened under color of title (title
certificate that in actuality was illegitimate)
However, tacking does not occur when there is no privity (transfer by deed, devise,
or intestate succession) between adverse possessors
o
Tolling
Statute may be tolled (may not start to run until a later date) if the true owner is
mentally ill, an infant, or in jail when the adverse possession commences the
statute begins to run when the disability ends
When a disabled person transfers adversely possessed property to a third party,
the disability is deemed to end on the day of the transfer and the statute begins
to run against the new party
**note: None of these powers need to be exercised to a greater degree than would be
exercised by the proper owner of the property (Nome 2000)
Acquiring Easements By Prescription
Requirements
1) actual use (need not be exclusive)
2) adverse use must violate the owners property rights
3) open and notorious use
4) continuous use
5) for the statutory period
**note: in CA, you do not need to pay taxes over that piece of land to establish a
prescriptive easement

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Case Law: Dieterich P had acquired a prescriptive easement over Ds truck stop
against the life tenant by driving over its property for 21 years to get Ps trucks into Ps
repair bays
Limits to Adverse Possession/Prescription
Majority rule: government land cannot be subject to adverse possession or prescription
o
Case Law: Kiowa Creek party seeking a prescriptive easement could not
establish that it had fulfilled the statutory period because for the first eight years, the
government owned the land
o
However, not all jurisdictions follow this rule
Rule: Adverse possession and prescriptive easements can never be established against the
holder of a future interest in the property; it only applies for the length of the present
estate
o
You must wait until the future interest becomes present and then start the whole
process over; however, if the future interest was created after you took possession, the
statutory period runs against the future interest holder as well
o
Case: Dieterich Ps prescriptive easement only applied to the estate of the life
tenant but not to the reversion held by the landlord
o
Rationale: The holder of the future interest cannot sue to eject someone using the
property unlawfully (this right belongs to the possessor) he can only sue if the person
is injuring the future interest by causing waste
Rationale for Adverse Possession/Prescription Doctrine
Economically efficient use of land reward the possessor who actually uses the land at
the expense of owners who fully utilize it and punish the lazy owner who sleeps on his
property
People should bring claims to land while the evidence is still good (general justification
for statutes of limitations)
Oliver Wendell Holmes wrote that when someone (even if a trespasser) comes to use and
enjoy something as their own for a long time, it takes root in your being and
emotionally harms you if someone comes back and takes it away from you by claiming
that they have title to it
o
Reliance interests develop in the property

Private Discrimination in Selling Property


Racial Discrimination
42 U.S.C. 1982
Rule: a seller cannot refuse to sell property to a buyer because of a buyers race due to 42
U.S.C. 1982
o
Case Law: Jones v. Alfred H. Mayer Co SCOTUS holding that Congress barred
such an action under the above statute, which was enacted as an exercise of Congress
13th Amendment power to enforce the provisions of the amendments ban on badges of
slavery through legislation
o
**Note: It is the legislation, not the amendment itself, which proscribes the
practice
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Federal Fair Housing Act (FFHA)


a) bans the refusal to sell or rent after making a bona fide offer or the refusal to negotiate
on basis of race/color/religion/sex/national origin/familial status
b) bans discrimination in the terms/conditions/privileges of a sale or rental of a dwelling
on such a basis
c) outlaws advertising that you make or intend to make preferences on such a basis
d) outlaws telling people that a house is unavailable when the house is actually available
e) outlaws blockbusting trying to make a profit by inducing someone to sell or rent
their houses by telling them that minorities are moving into the neighborhood
o
Exceptions
A person who does not own more than three single family houses at once time can
sell or rent a single family house w/o this law applying provided that he does not
sell more than one house that he is not residing in every 24 months
He cannot use any sales or rental facilities or the services of any real estate
agent
He cannot advertise/publicize racist preferences in violation of part c)
A person renting rooms in a living quarters occupied by at most four families living
independently of each other and who lives in one of the rooms can rent the other
rooms w/o this law applying
Prohibits discrimination in the extension of credit involving real estate transactions
Prohibits discrimination in the membership of real estate brokers organizations
Other rulings
Courts have not allowed homeowners associations to exercise rights of first refusal as a
means to block minorities from moving in (Phillips)
Courts have not allowed landlords to maintain racial quotas in renting out apartment
complexes to preserve racial diversity (U.S. v. Starrett City Associates)
Discrimination Against the Handicapped
42 U.S.C. 3604
Sellers cannot discriminate against buyers or renters on basis of handicap
Sellers cannot discriminate in the terms, conditions, or privileges of sale or rental based
on handicap
Discrimination includes
o
Refusal to permit, at expense of handicapped persons, modification of premises to
make them accessible/useable
o
Refusal to make reasonable accommodations
Limits
Does not extend to people searching for roommates or sites helping people find
roommates (Fair Housing Council v. Roommate.com)

Laws for structurally supporting others land


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

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


Publics right to use navigable waters for recreational purposes (sometimes)
Private riparian rights of others
Rights to Underground Water
Did water come from a stream?
o
If underground water can be proven to come from a stream, the same laws that
apply to above-ground streams apply (see above)
If the water is diffuse or percolating, one of three doctrines may apply
o
Reasonable Use doctrine
Most common doctrine in U.S; developed b/c absolute ownership doctrine was
leading to depletion of aquifers
Generally no limits on use of water (other than for malicious or wasteful purposes)
as long as use is reasonable uses on the land where the water was extracted are
usually found reasonable and uses where the water is transported off the land are
often considered unreasonable
Case Law: Cline court prevents D from pumping out so much water from a
communal aquifer for Ds quarry that the aquifer becomes more contaminated;
subjects D to a reasonable use standard
Rationale: Benefits entities who are economically less well off, prevents tragedies
of the commons
o
Absolute Ownership (English) doctrine
Whoever claims the water has an absolute right to use it w/o regard to how it affects
the ability of his neighbors to use the water, unless he is maliciously collecting the
water to injure others
Rationale: Encourages investment by powerful entities in a resource-rich area;
however, it can lead to a tragedy of the commons
o
Correlative Rights doctrine
Developed in CA; similar to reasonable use doctrine but in times of shortage, a
court may apportion the water amongst different parties
Rights do not extend to the right to deplete a neighbors water supply
Diffuse Surface Water
Refers to drainage water from rain, snow, etc. that runs over the surface but does not
amount to a stream
o
Plurality rule: reasonable use doctrine
A person is allowed to alter drainage of surface water to the point that it causes
unreasonable interference with his neighbors use of the land
Is in between the other two doctrines and is becoming favored by a plurality or
majority of states
Factors for determining reasonability
necessity of draining water
whether person acted with care
damage caused to neighbor
feasibility of better drainage methods
o
common enemy doctrine
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Surface water is considered a common enemy and, to encourage the clearing of


water to develop land, a person is allowed to take any means to clear the water and
is not liable to his neighbors for flooding them
A frequent modification is that a person may not clear the water in a manner that
exceeds or alters the natural flow of the water
o
civil law doctrine
Inverse of common enemy; a person is strictly liable to others for any damage from
surface water that he has cleared off his land
Downside: This inhibits development of any land, so the doctrine is often modified
by blending it with the common enemy doctrine in many jurisdictions that use it

Torts to Real Property


Nuisance
Rule: A substantial interference with the use and enjoyment of land that is intentional and
unreasonable
o
Public you must show that you have suffered a wrong that is distinct from other
members of the general public at large relates to the deprivation of use/enjoyment of a
right that you have as a member of the public
o
Private relates to the deprivation of use/enjoyment of a property interest that
you have
Coming into Nuisance: Buying property when nuisance is present weighs in favor of D
Just because an act conforms to a zoning law does not mean it is not a nuisance
**If utility of Ds action outweighs gravity of harm caused to P, that can be a ground for
finding no nuisance
**Note: you can be held liable for the actions of 3rd parties on your property if you are
aware that they are causing such disturbances and you do not make a substantial effort to
stop it (Mark v. Dept. of Fish and Wildlife)
Who Can Bring Actions For Nuisance?
Landowner
Anyone with a possessory interest (i.e. tenant)
Anyone with another proprietary interest that is being violated (i.e. owner of an easement
Examples of Nuisance
Harms from light, sound, dust, etc.
environmental harms from landfills
maintenance of crack houses
maintenance of halfway houses
erection of fences, billboards, walls by one property owner to maliciously harm another
neighboring property owner
lewd, public nudity and sexual activity (Mark v. Dept. of Fish and Wildlife)
Remedies
Injunction: If substantial damage from nuisance is shown

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Permanent Damages: If the benefit of the conduct does not outweigh the harm enough to
declare no nuisance, but ending the conduct would place a huge burden on D or
society. i.e. Shutting down factory (loss of investment/jobs). (Boomer v. Atlantic Cement)
o
Acts as a servitude on landthe nuisance payment will run with the land
o
This may be a taking because you are allowing A to buy an interest in Bs
property (Continue Nuisance for payment)
o
Rationale: An injunction that cost the violator a huge amount of money could only
be released once the violator paid the plaintiff to release the injunction; plaintiff would
get a windfall b/c the violator would pay anything less than the amount they would lose
by having to suspend their activity
Counterargument
damage award set by the court allows the violator to pay a licensing fee for the
nuisance
this licensing fee is an unconstitutional imposition of a servitude on the harmed
partys property w/o their consent; normally the govt. must justify this under the
5th Amendment due to a public use/public purpose
Continuing Damages: If the nuisance was temporary or this will cause party to stop
Trespass to Land
An actionable invasion of a possessors interest in exclusive possession of land
o
Owner entitled to actual damages
o
Punitive damages only given if actual damages (Barnard Rule)
Exception: If nominal damages will not be enough to protect right of exclusive
possession, give punitive even when no actual damage
Case Law: Jacque v. Steenberg Homes D forced to pay $1 in nominal
damages and $100,000 in punitive for willfully going across plaintiffs property
against Ps wishes even though it caused little damage because it was winter and
Ds trailer could not do substantial damage to the land
Exceptions to the right to exclude
o
Civil rights statutes apply in places of public accommodation
o
Malls have to let people collect petitions there because they are areas open to the
public (Pruneyard)
Farmers cannot exclude lawyers and doctors from his premises to prevent them from
seeing his migrant worker employees (State v. Shack)
o
Rationale: Right to exclusion outweighed by social benefit
These populations are vulnerable because of a gross disparity in bargaining power
b/w them and the employer (the workers are migrants, they dont have an outside
Spanish-speaking community in the US in the 1970s, they have very low economic
power)
These rights are essential to their well-being

Torts to Personal Property


Trespass to Chattel
Invasion of personal property that (1) deprives owner of use (2) damages chattel (3) OR
impacts functionality
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o
Allow reasonable invasions based on reasonable expectation of privacy/
exclusivityEmail network is open to public
o
Prohibitions should not burden business (i.e. prohibiting unwanted emails)
o
Case Law: Hamidi Ds unwanted emails to Ps employees did not constitute
trespass to chattels because they had not damaged nor interfered with the function of
the email network
Conversion
Def: wrongful dominion of one person over anothers chattel/property; plaintiff must
establish ownership, possession or right to possession.
Case Law: Popov v. Hayashi
o
P caught a baseball but was attacked by others in the crowd, loses it and D takes
possession of it
o
Ct says P had PRE-POSSESSORY RIGHT ballan ENCUMBRANCE on
property, a qualified right to possession which can support conversion claim
o
although D did prove he had possession of ball, cant claim ownership b/c ball
was encumbered w/ Ps pre-possessory right
o
court uses EQUITABLE DIVISION: both had equal titles to the ball, so just
divide the property rather than determining all or nothing
Other Examples of Equitable Division in Conversion Cases
o
Confusion Doctrine (Prunes Case)
If you have something that is fungible and it is grouped with something else that
belongs to someone else and part of these items get damaged, but you cant tell
whose items got damaged, your interest in the damaged goods is equal to your
proportion of the overall share
o
Keron v. Cashman holding that each person was entitled to an equal amount of
money in a case where five boys found a heavy sock and tossed it amongst each other
before the $775 spilled out of the sock
Remedies In An Action for Conversion
Sue for conversion court will force the wrongful possessor to buy the chattel from you
Sue in replevin court will force wrongful possessor to return the chattel

83