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PROPERTY

OUTLINE Likely Essay question topics: NY not duty to mitigate in LL/T - know that statute & number Easement Kenneth Cole case no duty to mitigate Rocekfellor Dumpler I. LEASEHOLDS: LANDLORD & TENANT LAW: focuses on the right to POSSESS and the right to EXCLUDE 1. LEASEHOLD ESTATES: Lease statute common law A. Non-Freehold Estates (Leases): i. Term of Years: greater than 1 yr. S of F 1. Fixed duration, notice not required 2. Common Law: No limit on the number of years permitted 3. Death does not affect obligations of L/T under the will ii. Periodic Tenancy: 1. Lease for a fixed period of time that automatically renews until either LL or T gives notice of termination termination is always uncertain until notice is given 2. Can be expressed or implied (if LL cashes check, then a periodic tenancy was created) a. If not express, look to periods of when they paid rent, court will impose that period b. EX: if oral agreement for 5 years not term of years, look to rent payments to determine period, and then enough notice? c. If terms say T is to pay every month but checks come erratically, still month to month not when the checks come but what the amount is for 3. Notice is required to terminate & must terminate on the final day of the period (end of month) 4. Common Law: a. Year-to-year lease: half a year notice required to terminate b. Less than a year-to-year lease: notice equal to the length of the period cannot exceed 6 months 5. New York Law: Only applies to L ONLY WITH MONTH TO MONTH a. NYC 232-a: L has to written notify at least 30 days before to terminate Lease (same as sufferance) b. NY: L has to give at least 1 month written notice to terminate I. Statute give minimum, so if K says 20 days notice, not valid, statute would apply iii. Tenancy at Will: 1. Last as long as each party wants, both LL and T have the right to terminate 2. Only Lease type that can be unilateral and ONLY if lease at the will of the T. If lease is at the will of LL, it is implied there is a similar right for the T to terminate, but not vise versa 3. Fragile: only lasts as long as each party is alive. a. Terminates if property is sold, if assigned to another tenant, L sells the property, L leases to another T b. EX: Oral lease for 5 years, L has right to terminate at will not a Tenancy at will because fixed duration of time. B/c L has right to terminate, implied T does too. Once L accepts and deposits a check for a period of time, becomes a periodic tenancy, have to find what KIND of periodic Tenancy was created (K law with offer & acceptance). To prevent Judge from implying period tenancy over a tenancy at will - EXPRESSLY STATE IN K a tenancy at will. 4. Common Law: a. No notice necessary can give 15 minutes 5. Modern Trend: This had changed over time to something more reasonable (Implies periodic tenancy unless expressly stated otherwise that its a tenancy at will)

6. NY228: for will and sufferance, L must give 30 days notice to terminate after 30 days, L can evict T, recover premises iv. Holdover Tenancy (tenancy at Sufferance): 1. Created when T wont move out (continues to have possession after the termination of his right of possession) L can either a. Evict T: treat T as a trespasser and evict b. Create a new Tenancy: Give consent, either express or implied, to a new term - Bind T to a new periodic tenancy I. If renew the lease then: 1. Common Law: term is length of previous lease 2. New York Law: length is longer than month to month, UNLESS K states otherwise, L can evict but if L accepts rent it will be for one month start periodic tenancy 2. LANDLORDS DUTIES; TENANTS RIGHTS & REMEDIES: Covenants are independent of Ts covenants A. Implied in EVERY Lease: INDEPENDENT OF TS DUTIES i. Delivery of Possession (either actual and/or only legal) 1. UK Rule (Common Law Rule): a. Implied duty to deliver legal and actual possession 2. American Rule (old NY Common Rule, Minority Rule): a. Implied duty to deliver legal possession only 3. NY Law 223-a: a. Uses default rule (UK/Majority/Common Law) b. UNLESS K states otherwise, than 223-a will govern: Legal & actual possession. K MAY modify it K can say only legal and then K governs. T can rescind and get any consideration paid Contract Statute: Common Law Absent a provision on the K (American Rule) only legal Possession NY Law 223- a applies 4. Hannah Rule: at the beginning of the term, there shall be no legal obstacle to the tenant right of possession (Hannah v. Dush) follows American rule - only legal possession required 5. EXAM: If no stated jurisdiction, go through both analyses. If Lease starts at the beginning of November and L tells T that old T moved out, go ahead and move in October 15th. L has NOT given legal possession because that doesnt start until 11/1. a. If Old T still in possession on 11/1: I. Majority/UK/NY: legal & Actual L must sue to evict holdover, T2 can rescind II. Minority/ American Rule: only legal possession T2 has to sue holdover T ii. Implied Covenant of Quiet Enjoyment: 1. Both residential and Commercial 2. Old NJ Rule: no implied covenant of QE because of the LL/T relationship needed an express agreement or use of some words that imply the covenant (NJ now uses Majority Rule) 3. Majority Rule: Implied in all leases: T has the right to quiet use and enjoyment of the premises without interference from L 4. Breach: 3 Things trigger a. Actual Eviction by L or a 3rd party (similar to ouster) I. Physically ousted

II. Damages: T can stop paying rent and sue for damages) III. NY 853: if AE, T can sue for treble damages (3 times amount fact finder determines is owed) b. Partial Actual Eviction: T has been blocked off from part of the property I. Damages: 1. T can withhold all rent (not just part) ONLY if its Ls doing, but put in escrow 2. T can sue L 3. T can sue superior titleholder ONLY if they did it. OR withhold rent, but ONLY part of rent II. NOTE: if T can live in part of the property then not impossible to live there c. Constructive evictions L makes it impossible to live there flooding, construction, heat I. 3 Elements which ALL must be satisfied: (SING dido raindrops) 1. S & I: substantial interference attributed to an act or omission of L (or anyone acting by, through, or under OR having superior title) - cant just be 3rd party i. Makes the premise substantially unsuitable for which they are leased EX: Every time it rains water floods the apartment 2. N: T must give notice and L must fail to respond meaningfully 3. G: Get out T must CHOOSE to leave within reasonable time cant be forced out look to who is causing the act if a 3rd party not CE i. If T does not leave, there is NO constrictive eviction claim 5. Default: Requirements can be modified or excluded in K 6. L is not responsible for the bothersome conduct of other tenants a. If Lease is silent too bad, no claim I. Covenant of QE = breached only when L fails to do something they were suppose to so according to the lease. It is not implied that there will not be noise b. If there is a provision, can enforce the lease iii. Implied Warranty of Habitability: like CE but by a 3rd party or nature (tornado) NON WAIVABLE 1. Only applies to residential leases 2. Considered essential, basic: non-waivable - even if parties agree to waive, CANT 3. New Rule (Hilder v. St. Peter): Premises must be fit for basic human habitation / reasonable condition a. Appropriate standard/ how to determine if there is a breach 2 ways: I. Look to the housing code/ local housing code, OR 1. If below standard prima facie negligence 2. If L violates a city housing code triggers Warranty of Habitability, not QE i. EXAM: TRIGGER: a warehouse or a loft that hasnt been properly converted to a residence (L only put up walls, might not be enough to meet WH) II. Go by a reasonable standard if no code/ independent judicial conclusion b. TRIGGER: will be a grey area where we have to choose between CE or WH 4. NY 235-b: Warranty of Habitability- same, need not be Ts fault and no suitable a. Fit for basic human habitation, L not breach if because of Ts doing/ under Ts control b. Any agreement that T waives/ modifies his right as set forth in this section is void c. In determining the amount of damages sustained by T as a result of Ls breach: I. Expert testimony not necessary II. Labor strikes not under Ls control are excluded from recovery unless they cause L to have a net savings but L must show good faith attempt to cure breach 5. Breach: no heat in winter, no plumbing, no running water 6. Ts remedies/ Ts options if L breaches: (M+RRR) a. M: Move out and terminate the lease I. Vacate II. Stop paying rent III.Make L pay relocation fees

b. R: Repair & Deduct I. Make the repairs himself and reduce it from future rent c. R: Reduce Rent I. T can stay in premises and request abatement (difference from rent and the defect), OR II. T can withhold all rent (put in escrow account) L will most likely sue and T can impose the breach of Warranty of Habitability d. R: Remain in possession, pay rent and sue for money damages I. NOTE: difference between constructive eviction (T must move out) and breach of implied warranty of habitability (T has 4 options) e. R: Retaliatory Theory I. L cant evict the T in retaliation of T notifying the state tat the L is in violation of a housing code/ statute dont want to punish a good faith complainant f. NY 227: When T may Surrender Premises: I. If premises destroyed by elements or made unfit for habitation, if not Express in lease to the contrary, T may quit and surrender possession and not pay rent 3. TENANTS DUTIES; LANDLORDS RIGHTS & REMEDIES: 2 essential duties A. Ts duty to repair: 1. Standard: T is responsible for keeping the premises in reasonable good repair 2. T must not commit waste: a. Voluntary waste overt/ harmful acts (cant do) I. EX: Adults write on walls if Fact pattern says previous L told this L that they are good Ts but they draw on walls L had notice must give both arguments b. Permissive waste ordinary wear & tear (T can do unless K states T must maintain in a certain condition) I. EX: If T is out of town, and neighbors knows and sees a leak, must report if it effects a safe living environment or else they are committing permissive waste c. Ameliorative cant improve unless T notifies L (the future interest holder). If improve waste b/c cant return premises in condition you found it I. If attached, consider both ameliorative and fixture (grey area) II. TRIGGER: fact patter with something that is cheap to install but expensive to remove 3. Law of fixtures (linked to the doctrine of waste) a. When a T removes a fixture, he commits voluntary waste I. T must NOT remove a fixture no matter that she was the one who installed it Fixtures pass with ownership of the LAND b. If we are not sure it is a fixture: I. Agreement/ K controls 1. T and L agree that T will install a chandelier but that T can take it with him when he leaves II. If no agreement, law says T may remove her installation so long as removal does not cause substantial harm to the premise 1. If removal will cause harm/ damage, then an objective judgment (not subjective of what T was thinking a the time she installed it) T has shown the intentional to install a fixture, III.If not substantial damage look to Ts intent when installing, if intent was to take down when leave then not a fixture c. In commercial can remove any fixture you install ii. Ts duty to pay rent: 4. DEFAULTING TENANT: A. Defaulting Tenant still in Possession: i. L can either:

1. Evict T: a. Common Law: L can use Self-help if: I. L is legally entitled to possession holdover T OR II. Breach of lease AND lease contains a re-entry clause (giving L the reversion right to re-enter and kick out T if T defaults) AND III.Re-entry must be peaceable, but only way to be peaceable if to go through the courts, so no Self-Help b. Modern Rule: L can never use self-help, must go through the jurisdictional process or else wrongful eviction hard to distinguish what isnt peaceful 2. Renew/ start new lease with T: new lease and sue for prior rent B. Defaulting Tenant who Abandons: i. Before abandoning, could surrender the lease, L can accept and then no more lease (Express offer) ii. If T abandons with no surrender (Implied offer) 1. New York Rule / Minority Rule / 8 jurisdictions use this: a. No duty to Mitigate 3 options (SIR) I. S: Surrender - L can accept Ts implied surrender of lease and re-let on Ls own account (T has no liability) II. I: Ignore - do nothing and collect full rent III.R: Re-let: Notify the T that L is going to re-let for his benefit, but if new T isnt paying as much, original T is liable for the difference or any deficiencies 2. Majority Rule: a. Duty to Mitigate: I. L must use reasonable diligence in re-letting- must at least try to re-let II. T must bear the cost of L reasonably trying to re-let III.T has to pay the difference if the new rent is lower b. If L doesnt mitigate in a mitigate jurisdiction cant collect damages 5. SUBLEASES & ASSIGNMENTS: A. Basic Landlord & Tenant Relationship: i. Privity of Contract: L --------(lease as contract) ---- T 1. Lease is valid if suffices K law ii. Privity of Estate: L--------- (lease as conveyance) ----T 1. Legally applies to the holder of the present interest and the reversion (future interest) 2. FOLLOWS THE LAND can only have ONE P/E but multiple P/K B. Assignment: i. Transfer the entire remaining right of possession (entire shopping bag f rights) to a 3rd party 1. Transfer legal and actual possession 2. T1 does not retain anything severs P/E. T1 still has P/K unless LL releases him in writing or novation or full perfromance there are no implied releases ii. After assignment, L had P/E with T2, P/K with T/I 1. If T2 assumed the lease, then L had P/K and P/E with T2 2. If T2 assigns to T3 (no assumption) a. L/T = P/K b. L/T2 = P/K c. L/T3= P/E (if t3 assumed then L would have P/K and P/E with T3) iii. Assumption = creating privity of K, L must be involved and agree to relieve T1 of obligation C. The Law of Suretyship: i. When LL has a choice to sue T1 or T2 (through P/K or P/E) and chooses to sue T1 - There is a creditor (L), debitor (T2) and a third party (T1) 1. If LL sues T2, then no problem, who ought to pay paid (equity)

2. If LL sues T1 then Suretyship a. T1 paid T2 debt (T2 was liable for the rent) and now T1 wants to sue T2 for that money b. T2 cant sue T1 Suretyship only goes one way ii. T1 can only sue whoever L could have sued D. Sublease: i. TI Transfers anything less than the whole to T2 (T1 becomes sub-LL) ii. T1 and T2 have P/K iii. LL does not have any legal relationship with T2 (no P/K or P/E) 1. EXAM: If sublease, find what kind of tenancy. State not P/E or P/K btw L and T2, L would have to sue T1 and T1 would go after T2 under Suretyship E. Reversion Interest: i. Assignment = LL ii. Sublease = T1 / Tn F. Have to look to the intention of the parties in the K to find if the K is a sublease or assignment if it says its an assignment, doesnt really mean it is i. TRIGGER: give us facts as to what they agreed to. It will say assignment but be a sublease & vise versa language of one but facts show us its the other match actions AND intent 6. CONSENT TO TRANSFER: A. LLs consent to transfer: i. Majority rule/ CL/ NY: L can withhold consent if unreasonable, if lease is silent, restrictions on alienation are disfavored 1. NY 226-b: Right to sublease or assign ONLY RESIDENTIAL CL, free alienation if K is silent. If provision this is the min T can be required to do K trumps unless K states less rights to T a. (1) Default Unless greater right to assign stated in lease, T cannot assign w/o written consent from L. L can withhold consent unreasonably but T may ask to be released from K with 30 days notice and L must release. If L withholds consent reasonably, then no release of K b. (2) If T lives in residence with 4 or more units, T can sublease with written consent from L cannot be unreasonably withheld I. T shall inform L of sublease by mailing notice of intent by certified mail with a return of receipt request with the terms, names, reasons II. L can ask for more info within 10 days. Within 30 days of notice or after 10 days if asked for info L must send notice of consent/ no consent. If no notice, then presumed L consented and sublease valid. If L reasonably w/h consent no sublet and T is NOT released from lease, if unreasonably w/h consent, T can sublet in accordance with notice and recover proceeding & attorney fees is found consent w/h in bad faith c. (5) Any sublet/ assignment not comply with statute = substantial breach of lease or Tenancy d. (6) any agreement to waive this provision = null & void ii. Minority Rule Kendall J.: L can withhold consent reasonably IF commercially reasonable excuse (every K has an implied good faith) (Kendal v. Ernst) only applies if no standard/ K silent 1. EX: L will withhold consent if he thinks he can charge a higher rate 2. EXAM: Fact pattern will be a lease with no assignment w/o Ls permission. Will have to argue PP favors the free transferability of land and interests particularly in cases of residential area where policy has a vested interest in housing as many people as possible restrictions on assignments are viewed strictly by the courts in favor of permitting assignments iii. If lease is silent about transferring, T may freely transfer iv. Dumplers Rule: In a Dumpler J, if L consents to one assignment, then he consents to all future assignments unless otherwise stated LL ------------lease ----------T1 I Consent of LL to assignment to T2

I T2 I I T3

Dumplers Rule: by consenting to the above assignment, LL consented to this assignment

II. TRANSFERS OF LAND: 1. The Contract of Sale: I I I I Pre-K ------------ K of sale------------------Executory period--------------closing----------post closing I I I I Equitable Title Passes (Reliance) Title passes (Equitable Conversion) (Implied Marketable Title) (Conditions and Covenants) PCs are breached B finds during EP but not breached until now K and Deed merge only look at deed, cant sue on K of sale A. Pre-K: B needs to do due diligence, shop around, inspect, search title NO obligation to seller, Seller no obligation to Buyer i. Duty to Disclose: 1. Majority: S has to disclose defects 2. Ancient Rule (Common Law)/ NY/ Minority: no duty to disclose defects. Being silent on an issue was not seen as lying BERMAN LOVES THIS FACT 3. NY follows Caveat Emptor (Buyer beware heavy bias in favor of seller): no duty to disclose unless: a. Fiduciary or confidential relationship between B and S b. Active concealment of latent defects - breached during Pre-K but not discovered until executory period. If found at closing then a breach of covenant c. Silence is not a misrepresentation d. Ghostbusters Exception: if condition materially impairs the value if the construction and it is within the knowledge of the seller and/or unlikely to be discovered by a prudent buyer exercising due care, nondisclosure gives that buyer the right to rescind as a matter of equity 4. NY RPL 460-491: Article 14 Property condition disclosure in the sale of residential real property e. 461 residential real property = real property improved by one to 4 family dwelling used or occupied, or intended to be used or occupied, wholly or partly as a home or residence of one ore more persons except condos/co-ops f. 462 every seller of residential real property shall complete and deliver a disclosure statement g. 465 (remedy) (1) If seller doesnt deliver statement buyer received $500 credit. (2) if seller provides a statement but willfully fails to provide a revised statement, seller liable for actual damages suffered by buyer and any equitable it statutory remedy 1. Insurance policy for seller after deliver statement, not liable for actual damages B. K of Sale: what is in the K usually mirrors whats in the deed equitable title passes i. Must stratify K law (offer, acceptance, consideration, no defenses) ii. Must comply with Statute of Frauds: 1. Names of parties

2. Price 3. Description of property a. Meets & Bounds I. EXAM: if Berman is bring tricky, can give us a deed with MB description and we have something where a neighbor, according to the MB is overlapping with what they are doing. Have to look at whether title is marketable 1. If the MB describes a pier, but your neighbor parks their boat there who owns it? 2. Are they Adversely possessing it? 3. Do they have an easement to use it? 4. Who own it when it will be conveyed? b. Square box number 4. Delivered 5. Minimum requirements: a. Writing b. Signed by party to be bound c. Delivered 6. NY GOL 5-703: Conveyances and contracts concerning real property required to be in writing (statute of frauds) a. (1) Any interest in property, other than a lease that is for less than 1 year, be conveyed in writing b. (2) & (3) Not enforceable unless the K is in writing and signed by the party to be charged c. (4) When not enforceable due to statute of frauds, judge looks for reasons to enforce (exceptions) C. Executory Period: i. Both the seller and the buyer has an interest in the property 1. EP = entering into a K for future events (closing), life happens during the EP want to be able to rely on selling/buying the property 2. Title is not transferred immediately upon signing the agreement/ K, because S and B must do certain things in the time between contract and closing: (title, appraisal, liens, mortgages, inspections) 3. Reliance EP locks in the price and lets B and S rely on their promises to each other ii. Conditions and Covenants: 1. Legal Significance of a condition: The failure of a condition to occur excuses the other party to not fulfill their promise 2. EX: I promise to buy your house if after an inspection there are no encumbrances, if I find an encumbrance, I dont have to buy. I cant be sued 3. A condition excuses a buyers promise it protects the buyer (but seller makes the conditions) 4. If K states subject to easements, covenants, conditions. Then good title iii. Equitable Conversion & Risk of Loss: 1. What happens during the Executory Period is unknown 2. Common Law Doctrine of Equitable Conversion: a. Buyer gets to enforce the K and benefit from an increase in a riding market, but, if that same house catches fire, burns down and is now worth $20,000, the K is still enforceable. B has to buy the $20,000 house for 1 million 3. Equitable Conversion = the moment equitable title resides with the buyer and the legal title/ record remains with the seller a. Buyer is an equitable owner at the time the K is made b. Buyer has equitable interest = benefit of increase, burden of decline 4. Risk of Loss: a. Majority/ CL: Equitable conversion treating the B as the owner even though S retains possession, so B should bear the risk of loss, but receive the benefit of increase

b. Minority/ NY CL: B can enforce specific performance and price abatement I. NY 5-1311: Uniform Vendor and Purchaser Risk Act: risk on party in possession 1. Unless the K states otherwise, when neither LEGAL or ACTUAL is given to B i. In the event a material destruction to all or part of the property occurs (EX: fire), or taken by eminent domain before closing, S CANNOT enforce K and B can recover any portion of the price already paid. S can recover any breach of K made by B prior to destruction ii. If immaterial, either party can still enforce K, but with abatement of the purchase price 2. If Legal or Actual is transferred to B, B bears risk of loss of material destruction, but B can sue for any breach of K prior to destruction c. NY: get UVPA as a standard and common law to specific performance & abatement of price d. To avoid any confusion, parties should make a provision in the K as to who bears the risk of loss iv. Market Conditions: during EP 1. EX: S and B enter into a K for sale for real estate for a purchase price of $100,000 In a rising market The property is worth $120,00 $100,000 Buyer wants to enforce: B v. S In a declining market The property is worth $80,00 Seller wants to enforce: S v. B 2. K of sale = tool of prevention courts cant enforce a K that doesnt comply with the SofF 3. 2 exceptions: a. Part Performance: b. Estoppel: I. The promise (oral agreement) must be foreseeable reasonable 1. Reasonable: orally say I will sell you this land for $15,000 2. Unreasonable: orally say I will sell you this trillion dollar building v. What K really is, is a K of marketable title, no one is contracting got bad title if B signs and B finds before closing unmarketable title, S cant enforce K at closing Implied covenant of marketability vi. Implied covenant of Marketability: Implied in K that at closing, S will convey marketable title, if B finds unmarketable title, S cant enforce specific performance/ bad title/ enforce K 1. Breach at closing 2. No statutes on this point, only common law and K law a. Common law: have to deliver marketable title (not perfect title) I. Want the buyer to take some risk, but not too much. Why we have the standard of marketability and not perfection 3. Marketable Title Defects: a. If S cannot convey Marketable Title the B is entitled to rescind the K / S cant enforce b. 2 types: I. Chain of title (very uncommon) not yours to sell 1. Total loss for B 2. EX: Fraudulent transfer (selling something you dont own), forgery (deed), incorrect legal description (attached to deed, says own lot A when you own lot B) II. Encumbrances (more common):

1. Almost always have to modify the CL rule in the K because there is usually some kind of encumbrance and under CL, if the lease is silent, any Buyer can get out of the K because it will be rendered unmarketable 2. 4 types of encumbrances: (MPUE = My Penis Used Emily) INTEREST i. Monetary The right of a 3rd party in the subject property usually a creditor with a lien ii. Possession Unmarketable if a 3rd party has the right to possession LL/T if T has a lease, right to possess and exclude others L cant sell until lease is terminated o EX: Restrictive/ Negative Covenant = private right (cant build a house higher than 2 stories, A builds a 7 story house, B can sue) Zoning = public right iii. Use Right to use but not the right to exclude others iv. Encroachments Analogous to a trespass, encroaching unlawfully onto someone As property and that intrusion renders As property unmarketable because after sometime (AP) it enables B to have ownership of part of A with the encroachment o 3rd party has interest in part of lot A o Bs property is still marketable (added bonus of the little part of A) 3. Zoning restrictions/ restrictive covenants does NOT render title unmarketable Its the VIOLATION of it that renders title unmarketable, not its mere existence Lohmeyer i. If latent (present but not visible) violation, not an encumbrance if: Freimberg: Do not appear in land records Unknown to Seller No official action to compel compliance (damages would be speculative) Have not ripened into an INTEREST that can be recorded on land records 4. If zoning law change during EP, still marketable, just not what B wants S can enforce K D. Closing: i. Present covenants are breached S of L starts running if B finds unmarketable during EP, tells S who tried to fix, if not fix, B must wait until closing when it is breached 1. NY: Transfer of deed takes place with all parties physically present 2. CA: Transfer is handled by a third-party escrow agent ii. as is clause = risk shifts from S to B and B cant claim fraudulent concealment iii. Merger: 1. When a buyer accepts the deed (at closing), the buyer is deemed to be satisfied that seller has complied with all contractual obligation i. The contract merges into the deed and the deed is deemed the final act of the parties expressing the terms of their agreements. K promises merge into the deed ii. Buyer can no longer sue S for promises in K of sale not contained in the deed (but must sue on warranties if any not in the deed)

iii. Merger = a sellers doctrine: a B who accept a deed that does not repeat and reaffirm the contractual promises made by the S to cure title defect may be barred from objecting later because implied in K not in Deed must be expressed in deed 2. This is not true anymore B can sue for promises in the K 3. Merge doesnt apply to promises in the K that are not about the property i. EX: I will sell you this property and 2 counseling sessions, counseling sessions are not in the merger 2. The Deed: A. Deed = promise going from S to B, B cant make any promises in the deed. B sues seller after promise because that is when they discover things that diminish the value. Post closing, buyer has already performed, given the money, so seller cant sue. If B discovers something they didnt know that indicated S didnt fully perform and B can sue i. 3 Requirements to Transfer Property: (LEAD lawfully executed and delivered) a. Deed Formalities (in lieu of livery of seisin) no longer have to go to the hill and transfer a rock, we can use a written deed to transfer property i. Must be in writing (Statute of Frauds) 1. Singed by Grantor (statute of Frauds) 2. Words of grant (the action verb) a. I hereby grant, sell, transfer, assign ... NOT I promise to sell (that is K law for a future action, deed is present) ii. Name of Grantor/ Grantee iii. Description of the land b. Delivery of deed: c. Acceptance by Grantee (presumed) i. Notary or recordation are NOT required to be lawfully executed B. Deed Covenants: i. PRESENT Covenants: a. Breached at time of closing (when deed is delivered) Statute of limitations starts at closing i. 3 Covenants (2 main ones): 1. Covenant of marketable title: 2. Covenant of Right to Convey Title/ Seisin - chain of title a. Right to convey legal title & authority 3. Covenant against Encumbrances (MPUE) a. The land is free from encumbrances, except. b. PC only run with the land in a Rockefellor J i. FUTURE Covenants: a. Breach occurs after closing - Statute of limitations starts when breach occurs b. FC ALWAYS run with the land!!!! c. 3 Covenants (1 main) i. Covenants of General Warranty ii. Covenant of Quiet Enjoyment: like L/T law 1. Like with L/T law, anyone with privity of K or privity of estate (superior title) with the original promissory can sue for breach of that promise (QE runs with the land) 2. B must be dispossessed 3. EX: A-----B----C-----N500 a. N500 is in P/E with A so N500 can sue A but he can only collect the amount the deed was from A--B iii. Covenant of Future Assurances C. 3 Types of Deeds: i. General Warranty Deed:

a. Warranties/ promises against all defects in title whether arose before or after Grantor took title b. GWD automatically includes 6 warranties i. Special warranty Deed: c. Warranties/ promises against Grantors acts but not the acts of others i. A--------GWD (Has a mortgage on the property)---B ------SWD---- ii. C discovers the mortgage, C cant sue B, but can sue A d. Conveying I have not done anything while I had title, but cant be liable for predecessors ii. Quitclaim Deed: a. No warranties/ promises b. Cant sue the person who gave you the QCD because there werent any promises i. EX: A-------GWD-----B---------QCD-----C ii. C can sue A but not B. B didnt make any promises and C has P/E with A 1. Rockeffellor: NEED TO GO BACK AND UNDERSTAND class 14&15 3. Title Assurance/ Recording System: i. The Index System: a. 2 types: i. Tract Index (only a few states use this) indexed by parcel/ tract number ii. Grantor-Grantee Index: 1. 2 separate indexes a. Grantor Index: instruments indexed alphabetically and chronologically under the grantors surname b. Grantee Index: same for Grantee 2. There is a separate grantee/ grantor index for different instruments (mortgage, deed, wills, liens) ii. Recording Acts: a. Common Law Rule/ Default Rule: First in time = First in Right A will always prevail b. Bs of the world said this isnt fair, judge-made law exceptions started and were codified into law c. Laws (old exceptions to CL rule) i. Race: same as CL ii. Notice (only 2 Jurisdictions) Last BFP to record wins 1. BFP cant have notice 2. 3 types of notice: a. Actual Notice b. Record Notice: c. Constructive Notice/ Inquiry Notice: i. Constructive Notice 1. Just looking, making an inquiry into the system to see who has ownership 2. If there is something B could have found, the court will say you have knowledge Oliver selling garage with Joes name on sign ii. Inquiry Notice: Harper v. Paradise 1. Recorded deed mentioned a previous condition in prior deed that was not recorded B must inquire into that condition/ other deed might be another owner 3. Shelter Rule: only in notice J O----A-----------I O------------B---I---C I

A records a. If B knew of O----A conveyance, then: i. A v. B: A wins B not BFP ii. A v. C: A wins - A recorded, C had notice b. If B didnt know: i. A v. B: B wins, B = BFP ii. A v. C: C wins shelter Rule: if B wins, then C wins or else that means B would never be able to sell their land. If B loses, doesnt mean C will lose. iii. Race/Notice / NY: First BFP to record wins 1. Subsequent purchaser (B) is protected against prior unrecorded instruments only if B: a. Is without notice of prior instrument at time of conveyance; AND b. Records before prior instrument records 2. NY:291: Recording of Conveyances a. A Conveyance of real property, within the state, on being duly acknowledged by the person executing the same (Grantor) may be recorded (doesnt have to) in the office of the clerk of the county where such real property it situated, and such county clerk shall, record the same in his said office. Every such conveyance not so recorded is void as against any person who subsequently purchases the same real property in good faith and for valuable consideration, from the same vendor and whose conveyance... is first duly recorded 3. If A owns land, and finds B just bought the land. B doesnt know about A. If B records first, B wins, A must hurry over and record before B does d. FACT PATTERN: could give us the statutory language and we have to interpret what kind of statute J we are in and then apply it to the facts/ people and he will ask who owns Blackacre? And list the parties i. When looking at recording Statute, remember they are there to protect a BFP, look at what they knew/ what they didnt know/ what is fair 1. BFP- cant have notice, facts cant state notice when acquired (grantor told you, facts state something, nothing in recording system) a. If BFP didnt search recording system, even if not recorded, B doesnt have a defense, B cant argue no constructive notice if no search b. Fact Pattern wont say he didnt search, just wont say he did e. 2 Principals: i. Record: If A records when he gets the deed, B cant ever take his land ii. Search: If B searches the record and finds O is not the TO, then B doesnt have to close and a problem will not arise in the future as to who the TO is iii. Chain of Title Problems: a. Chain of title = series if recorded documents that give constructive notice to a subsequent purchaser b. Mother Hubbard Clause = I transfer you these 7 things and everything in my purse (we dont know what is in her purse, but we consider it a conveyance under property law) i. In Kansas they uphold Mother Hubbard clauses ii. In other Js that dont uphold would say you need to identify/ detail all that is being conveyed when you discover what is included in the Mother Hubbard clause need to record that iii. Problem with Mother Hubbard is when you go to look for a recordation, dont know what was conveyed c. Wild deed: ONLY APPLIES IN DEED FROM ORIGINAL GRANTOR TO WHOEVER O--------A (doesnt record) -----------B (records)

O-----------------------------------------------------------------------C (records) i. O---A deed = a wild deed, it is a nullity ii. C v. B: C wins. Even though B records first, C is a BFP because the record doesnt show A had title to convey to B and the A---B recording is a nullity (looked at as not there/ invisible). Unless the O---A deed is recorded before the O-C, C wins. d. Without all deed formalities (name of grantor, signed.) deed is a nullity and wont act as recorded a. Board of Ed of Minneapolis v. Hughes: Grantee has the authority to fill in Grantors name in deed if Grantor did not do so himself that will make the deed operative iv. Persons Protected by Recordings: a. Forgery (Void) ONLY B is protected C loses O----- forged (void) ---A (R), usually A will be the one to forge the deed O-------------------------------------B B wins. Even if A-B--C---X, B wins because if O--A is void, then all other after dont count b. Fraud (Voidable may not be void, depending on when the fraud is discovered) i. Fraud in the inducement (Voidable) 1. Fraudulently induce someone to buy. Know something is false and say it anyway (ex: I own this property or The sewer never smells) and induce them to buy ii. Fraud in the Factum (execution) Always Void 1. EX: ask someone to sign a petition but it is really a deed conveying their land to you iii. If both parties are innocent, then whoever could have prevented the loss has to endure the loss v. Marketable Title Acts: a. MTA: Limits title searches to the years specified in the statute (30-40 years). b. Under MTA, all claimants of interest in land, to be safe, must file a notice of claim every 30-40 years after recording their instrument of conveyance the first time. i. EX: O (1900) ---------- A (R) O (1910) --(subject to A)---B (R)-----(1920, no mention of A) C (R)--- (1990, no mention of A)---D ii. D wins he was a BFP, no notice since MTA, after 1980 (B-C with no mention of A) C doesnt have to look any further vi. Limitations on recording systems: doesnt tell if deed is forged, fraud or there is AP why you have to buy title insurance 4. The Mortgage: i. Types of Financing/ Mortgage Substitutes: a. No Financing: S----deed/possession & use--Buyer S ------------$$$-------------------B b. Acquisition Financing (3rd party financing) S----deed/Possession & use-- Buyer -----Mortgages & Note ---- Lender S----------$$$------------------- B -------------------$$$-------------------Lender c. Purchase Money Financing: S------------deed/possession & use ------------------------------------------------------Buyer S ---------down-payment $$ and Mortgage & Note(as if S is the lender)---------Buyer S -----------------------------------payments in monthly installments ----------------Buyer d. Installment Sales Contracts/ contract for deed: S/contract Vendor ------------possession & use ------------------- Buyer/ Contract

S ----------$$$ - installments over a period of time ----------------B S -------------deed delivered after last payment made ------------ B i. Where a bank wont give a loan (maybe borrower = high risk), Seller gives the loan ii. S is in better position at the end of the day if something goes wrong 1. ISK, it will say deed will be transferred at the end of the period 2. Includes a forfeiture clause buyer forfeit the land & payment if B defaults 3. S retains legal title (whereas w/ Mortgage has lien) iii. Avoids expensive judicial foreclosing automatically gets the land back iv. BUT if it looks like a duck and smells like a duck its a mortgage v. Basically a REALLY long Executory Period e. Assuming the Mortgage: S -----deed/possession & use ---- B----Assumption of Mortgage/ Note -- Sellers Lender S -----------------------------------------$$$ MINUS credit of loan balance ------ Sellers Lender i. B assumes Sellers debt and is now personally responsible to Sellers lender ii. Assumption is not implied K must clearly state B assumes Mortgage/Note iii. The Note must be signed to be enforced, if B doesnt sign, B not liable - covenants run with the land, a note is not a covenant, the new owner cant be sued on the note iv. P/K only comes with assumption v. subject to v. Assumption 1. B always gets deed subject to because Bank can always foreclose 2. B must explicitly assume Mortgage for B to be personally liable 3. S is never off the hook unless Bank releases him in writing or novation f. Mortgage Substitutes: they are there to get around the cost & time foreclosures take i. If it looks like a ducks & smells like a duck its a mortgage ii. TRIGGER: If there is a chunk of money, a period of time the payments are to be made over and no interest rate its a mortgage but that are trying to make it look like something different (ISK or something) 1. He will test on a substitute ISK look at whether they are in the same position they would be if it were a mortgage. Only puts S in better position is at end of day something goes wrong ii. Formalities: Mortgage should be written (S of F), signed by borrower, names of parties, principal amount, due date, rate of interest, description of the property iii. Mortgagee has 2 parts: a. Promise to pay, AND b. Security interest (interest in the land) iv. CL: Title theory creates an intents in land but only for security v. NY: A mortgage merely creates a lien rather than conveying title: S------A---Mortgage/ Note (creates a lien, not conveying title)----- Lender S ---$$$------------------A------------$$$--------------------------------------Lender i. S = legal title - right to receive full payment of the K at closing or subject to the K ii. A = equitable owner - possession and use, will receive the deed/ legal title once paid in full iii. Lender = equitable lien for the payment of the purchase price. To collect, must foreclose on property or personally sue or both a. Suretyship: Same as in L/T law vi. Equity of Redemption: Right of Mortgagor to redeem property after forfeited f, can pay full mortgage plus costs ONLY FOR MORTGAGE SUBSTITUTES a. Majority: only up to point of foreclosure sale b. Minority: by statute, allows a specific time to redeem after foreclosure sale, even if sold to someone else i. Only if new home owner is a BFP no notice of mortgage, if Mortgage is recorded, then equity of redemption trumps new buyers title

c. Non- waivable all Borrowers have a right to equitable redemption III. ACQUISITION OF PROPERTY (OTHER THAN PURCHASE & SALE): A. Adverse Possession: A STATUTE OF LIMITATIONS DOCTRINE i. Involuntary conveyance between TO and AP ii. Fact Pattern: muddy facts have to analysis whether AP or easement. Ask what are they doing? Make a list of the facts of what they are doing that makes them act like the owner and ask do they have permission to do that? a. AP Sues TO: quiet title for court to declare AP is the rightful owner b. TO sues AP: ALWAYS seeking ejectment AP is in wrongful possession and TO has superior/ legal right to possession c. Most courts require that the AP take subject to all prior easements, covenants, and equitable servitudes. iii. Policy: a. Encourage the productivity of the land: have to choose between these 2 claims, lets reward the party who had a more productive use of the land (occupied, grew crops, built home) b. Reliance if AP in good faith believes he is the TO and made improvements in reliance on that, we want to protect their interest c. Policy reasons (for Statute of Limitation) i. Certainty, good / fresh evidence, encourage people to act soon iv. Elements (ECOAH) claim of right a. Exclusive i. Cannot share with the owner, so you have to kick the owner out. ii. Cant share with the rest of the world, but a group can adversely possess a parcel. b. Continuous (duration) i. AP has to possess the property in the same way the TO would. AP has to act as TO would ii. If TO would use it as a summer house, then AP satisfies continuous requirement if AP uses it as a summer house (Howard v. Kunto) 1. Have to know when AP took possession to know when to start counting iii. Tacking: 1. Can tack on predecessors duration for an AP claim ONLY if there is P/E (which works both ways AB and NAP) - transfer was voluntary. Cant tack if taken by AP or involuntary 2. An active trespasser doesnt get credit to the prior time, but a mistaken trespasser does (take the wrong land, think it is yours. Howard v. Kunto) 3. English Rule Do not need P/E anyone can continue with possession as long as it is continuous ouster of AP can tack on AP time. iv. After the statutes have run, AP = TO at that moment. Land cant be taken from AP by will, intestacy or deed 1. Transferring land doesnt negate AP claim 2. If O at death, transfers to B for life, remainder to C then B dies 20 years later, never have brought suit on A, A =TO, remainder doesnt go to C c. Open & Notorious (possession) NOTICE (Manillo v. Gorskii) i. Visible need to let the TO have a chance to know AP is there ii. Encroachments: 1. Major: a. There is a presumption of notice if it were a diligent TO, would assume that had notice b. It is clear and unequivocal c. Actual or imputed knowledge is enough 2. Minor:

a. A Diligent TO might not know of a minor encroachment b. Dont want to punish diligent TOs who in good faith didnt realize c. Generally under several feet = minor encroachment d. Intrusion is not clearly and self-evidently apparent to the naked-eye 3. If an innocent trespasser of a small portion of land adjoining a boundary line cannot without great expense remove or eliminate a minor encroachment, the TO may be forced to convey the land so occupied, upon payment of the fair value of the land, and only if the sale of the land does not render the remainder of the parcel unusable or no longer capable of being built upon. d. Actual Possession (possession) i. Cant Intend to take possession (could intend to take anything), must take actual possession e. Hostile & Adverse (possession) CLAIM OF RIGHT i. Mistaken belief that AP is the TO. AP cant have permission if permission, not hostile. If AP first came on land with permission, for AP claim, have to show some fact there was a hostile moment to get S of L clock ticking ii. Minority: Maine Doctrine (prior NJ Rule) 1. Need intent rewards the intentional trespasser (obvi why many Js dont use this). GF cant claim AP because not hostile enough have to fight! iii. Majority: CT Rule 1. Dont look at intent only care about whether there has been an unlawful possession & entry all use is presumed unlawful. iv. EXAM: for this element: Objective/ No Intent/ CT Rule AP (Intent) < Good faith Intent < Bad faith/ Main Doctrine to be hostile, have to know its not your and fight for it. Mistake of belief is not OK v. Requirements (taken from Valkenburg): to acquire real property by AP not founded upon a written instrument need at least 1. 15 years of actual occupation 2. Exclusive 3. And the premises must either be a. Protected by a substantial enclosure; OR b. Usually cultivated or improved (similar to open and notorious) vi. NY 511: Color of title need to occupy for 10 years as stated in the instrument. Cant know instrument is invalid. If track divided into lots, AP of one lot doesnt give right to all lots vii. NY 521: Actually occupy for 10 years. Exclude all others except, unless AP acquires knowledge that another is the TO viii. Exam Note: if the statutory period for SOL is 10 yrs, and on the 9th year and 364th day, TO realizes that AP is on land, what does TO do? 1. Give the AP permission to use the land. Destroys the AP claim. v. Color of Title v. Claim of Title: a. Claim of Title: Hostile & Adverse not really my property but should be since I thought it was / used it / improved it. i. Requires actual possession - only get the part actually possessing ii. Generally, an adverse possessor gains ownership of only so much of a tract of property as the adverse possessor actually occupies.

b. Color of Title: Claim founded on a written instrument that is for some reason defective & invalid i. Color of tile is not required for an AP claim, but gives a big advantage: 1. Constructive Possession: An exception to ^this^ rule is when the AP claims the land under color of title, pursuant to a written document. (the AP is deemed to be in constructive possession of the entire tract). a. Exception to Constructive Possession: when the TO is living on a part of the tract, AP may claim only the land actually occupied. i. Example: 100 acre tract, TO has a house on 5 acres on one corner of the tract, and is unaware of the APs house on the opposite corner of the tract. AP can only claim the land that the AP actually occupies ii. When there is a color of title issue, also think deed covenants (i.e. covenant of seisin present covenant analysis < rockefellor/non-rockefellor) vi. Disabilities: a. Insanity, Imprisoned, minority b. If the TO is disabled from bringing a C/A to recover possession at the time the AP entered land, then SOL freezes until disability is removed c. Depending on J Statute will allow TO can bring suit for some specified period after the disability is removed d. Disability = immaterial unless it existed at the time the cause thereof accrues (AP entered land) Disabilities do not tack. e. Can chooses either 10 years after removed or 21 based on what benefits the TO (figures from text statute) S of L period or time allowed after disability removed vii. FACT PATTERN: AP can only get what TO has NOTHING more if TO has life estate, AP will only get possession for a LE for the time of the measuring life i. After expiration of SOL period, AP acquires what the TO had at the time of APs entry. 1. Example: AP enters TOs property adversely. TO (owner in FSA) conveys to B for life and then to C. If B is TO at the time the SOL expires, the AP would acquire the FSA that TO held at the time of APs entry. b. Co-tenant and L/T can acquire land through AP but MUST show hostility B. Acquisition by Gift: A can only get what interest O had if life estate, then only life estate i. Elements: of an effective gift a. Intention: Of O to give it to A b. Delivery: A. Actual/ manual (all Js recognize this type); OR B. Constructive (some Js) item is incapable of being delivered give A they key or something symbolic 1. If the object is deliverable then it MUST be delivered C. Symbolic (few Js) 1. Under a Bost Jurisdiction, there is no such thing as symbolic delivery (one end of the spectrum/ extreme/ no law) 2. Modern trend = less strict, ALL elements are satisfied if clear and convincing evidence proves donors intent a. Gruen v. Gruen: father gives son painting but keeps life estate in the painting for himself until he dies. Dad dies b. Actual delivery not necessary anymore court recognizes symbolic (letter saying he will give it to him with description and name of painting) c. Could give it to son with a 2-step process (Dad -son, son then lets dad use it until he dies) could now be done in 1-step

d. If father said I will give you the painting after I die not enforceable futurfde promise c. No Consideration: A. Not a 2-way exchange, the donee and donor are not exchanging consideration d. Acceptance: Presumed without evidence showing rejection, there is no rejection. e. Irrevocable: ii. Ways: a. After Death: A. Will: only way to give gifts after death b. While Alive: Deed A. Intervivos: giving something away while you are alive between living persons 1. Can either: a. Sell b. Give it as a gift i. I give = present transfer ii. I will give = future promise, not enforceable by law B. Causa Mortis = gift given on death bed (different rules than normal gift giving) 1. Have to be in fear of immediate death and then die 2. Expectation of death is subjective; an objective or reasonable expectation is not required -- (question of fact) a. The illness, disease, or peril prompting the expectation must be objectively present. 3. IV. THE SYSTEM OF ESTATES: A. Possessory (Freehold) Estates: i. 4 Types of Interest: a. The Fee Simple Absolute (FSA): Best Estate only one with no alienable limitations/ restraints who shopping bag b. Divisible transferable by will c. Descendible passes to ones heirs if died intestate, by statutes of intestacy d. Alienable to be transferable inter vivos A. Created: 1. CL: To A and his heirs 2. Modern: To A (if in 1700 To A it was a life estate) B. No Limitations/ restrictions Owner has all present & future interest C. Characteristics: 1. A doesnt have heirs until A dies no living person has heirs - Heirs dont have an interest in the land until A dies (owing the property) 2. Modern-day presumption: to figure out the intent of creator (which estate O wishes to pass), start with a FSA, then see if language was clear to put restraints/ limitations on As FSA/ alienation. If so, what are they and that is how you find out which estate was intended to be created, as long as the other characteristics of that estate apply as well a. If it is determined a FSA and there is a restraint, the restraint is not enforceable b. If it is not a FSA and there is a restraint, then it is enforceable D. Future Interest: None no reversion in a FSA gave the whole bag away e. The Fee Tail: A. Created: 1. CL: To A and the heirs if his body

2. Modern: Pretty much abolished O Uses Life Estate to control inheritance (to A for life and then to.) B. Limitations: And the heirs of his body stays in the blood family, as long as A has descendants C. Future Interest: O keeps reversion or remainder (in 3rd party) there is the theoretical possibility that As line of descendants might die sometime might be 600 years from now f. Life Estate: A. Created: To A for life or To A for life then to.. B. Limitations: Only for As life. If A sells to B who dies intestate, it goes to Bs heirs until A dies C. Life Estate Per Autre Vie a life estate measured by a life other than the grantees. D. Characteristics: 1. Present Interest Holder v. Future Interest Holder a. To A for life then to B (this is a remainder) i. Leaky roof A can do whatever he wants, but has to worry about what B will do/ think ii. If A sells to C, when A dies, it goes to B. The Cs of the world probably wont buy, so if A needs to sell, will have to go to court for a judicial sale court will take both present and future interests into account iii. FI holder can sue PI for waste is AP takes over PIs interest for not trying to eject 2. The Life Tenant must not commit waste [refer back to Leases for Waste] E. Future Interest: ALWAYS (whether reversion [to O] or remainder [3rd party]) g. Defeasible Estates: Defeasible = Brought to an end A. Fee Simple Determinable (FSD): (FSDPOR Frank Sinatra Didnt Prefer Orville Redinbocker) 1. POR Possibility of Reverter in the Grantor. 2. Created: To A and her heirs until, so long as, during, A is married a. Grantor must use clear durational language 3. Characteristics: a. Think of it as a FSA with limitations of reversion if a specified event happens b. Moment A divorces, by law O automatically gets back land c. POR: possibility of Reversion O is called the POR, he has the possibility of reversion if the specified event happens d. If deed is silent, POR = O, if O dies, then Os heirs e. Fee Simple Subject to Executory Limitations (FSSEL): third party gets future interest 4. Limitations: a. A can do whatever she wants with the property (FSA), but the limitation follows: i. O conveys To A so long as she stays married A is married, A--- B, 20 years later A divorces. O gets property back 5. Future Interest: ALWAYS = POR 6. If the condition is violated, forfeiture is automatic. B. Fee Simple Subject to Condition Subsequent (FSSCS): 1. Created: To A (and her heirs); but if/ provided that/ however if/ on the condition that A divorces, then to O a. Grantor is using clear durational language b. Grantor is explicitly carving out the right to reenter and retake.

2. Characteristics: a. ROE: Right of Entry i. The power of termination b. O has right of entry can yank the string back if A divorces, but NOT automatic 3. Limitations: a. A can do as he pleases with the property, but the condition follows and O may yank the string if the condition happens 4. Future Interests: ALWAYS ROE C. How to tell the difference between FSD and FSSCS: 1. Semicolon Rule: a. FSD: To A for as long as.; then b. FSSCS: To A; but if.., then i. Closer to Grantor = less property rights ii. Closer to Grantee = more property right (isnt automatic) 2. Mahrenholz: Common Law Jurisdiction a. Mahrenholz: i. If dont know which one, FSD / FSSCS, if the stated language suggest the land to be used for a single purpose school purpose only, then FSD 1. FSD: to school only as long as they used it 2. FSSCA: to railroad forever, purpose limited to railroad use Difference = only made more limitations on property than saying forever unless something happens ii. EXAM: dont have to pick argue both 1. Might be FSD because immediate language, However, 2. A court might determine FSSCS b/c of language but if D. Manhrenholz/ CL: Reversionary Interest (future Interest) CANNOT be transferred UNLESS it is transferred to the present interest holder. Interest must be stated in original deed (Either O or excutory limitations 3rd party). If O dies, automatically passed to Os Heirs. O cant convey reversionary interest, 3rd party cant convey and Os heirs cant convey UNLESS it is transferred to the present interest holder = exception E. Modern: can transfer interest (alienable, inheritable, devisable) F. EXAM: Say if this follows a CL / Mahrenholz Jurisdiction which doesnt allow intervivos transfers. Go through all steps and say who wins G. AP and Fee Simple: 1. FSD: once event happens, O automatically has possessory Interest so time starts clicking 2. FSSCS: once event happens, O has to yank the string to get a possessory interest so until he yanks the string, AP time doesnt start clicking B. Co-Ownership Interests: i. 2 or more ownerships ii. First determine why type of estate (freehold: FSA, FT, LE, DF/ leasehold: TPWS) then ask how many owners? iii. 3 Types of Concurrent Interests: a. Tenancy in Common (TIC): Think of it as a FSA with the right to the whole A. Separate but undivided interest in the whole 1. EX: roommate I have this bedroom, but can use/ responsible for the whole (would want an tenant agreement between us as to who is responsible for what) 2. Can have unequal interest but same rights to the whole

B. Freely transferable, alienable, divisible (can do whatever you want with your interest transfer, leave it in a will, give it as a gift) 1. If A and B = TIC, and A then A--C, now C and B = TIC C. Co-owners DO NOT have survivor rights (If A dies, B does not get As interest) D. TIC is the modern default position this is the presumption if the parties cannot figure out what type of co-ownership they have this presumption is rebuttable. b. The Joint Tenancy (JT): (with rights of survivorship JTWROS) A. Joint Tenants are regarded as a single owner B. Created by 4 unities TTIP 1. Time = interest of each JT must be acquired at the same time 2. Title = interest must acquire by the same instrument 3. Interest = JTs must have identical equal interest (undivided shares of and identical interest measured by duration) 4. Possession: JTs must have right to possess the whole C. CL: if A owns Blackacre and wants to create a JT in Blackacre with B: 2 steps: 1. A conveys to strawman 2. Strawman conveys to A and B (need to acquire at same time) 3. And A and B have Equal shares D. Modern: 1. Abolished, CL = silly law, can do this in 1 step: A conveys to A and B. More efficient 2. Dont have to have equal shares (if sold, divide profit accordingly) E. Characteristics: 1. Difference between JT & TIC = in JT, when JT1 dies, JT2 gets his interest (JT1 interest cant be left in a will) 2. JTWROS = misnomer, like FSA, survivors dont really have a right, just hope parents are last JT to die and die still owning their interest F. Severance: 1. Very Fragile, any JT can transfer while alive, severing JT and creating TIC (dont need other JTs permission, can do it secretly even) 2. Need to destroy on of 4 unites to create a TIC if any is destroyed, TIC is default 3. If more than 2 JTs, and JT1 transfers to X, X is a TIC, and all others are still JTs amongst themselves a. Riddle v. Harmon: severance, like in creating, modern law abolishes CL rule of a strawman, A can convey to A at any point to sever JT with B (since didnt acquire at same time now) 4. Severance of JT = no more JTWROS, B wont get As interest anymore 5. Cant sever in will, want to keep it simple. When searching title, dont have to look anywhere else except before As death if deed is a JT, we know interest went to B keep it simple, dont make them search further. G. EXAM: there will be a Q about a JT that gets blown up or a JT severs unity c. Tenancy By Entirety (TBE): A. JT but with marriage JT is indestructible, 4 unities but can only be severed by divorce, death, bankruptcy. Have to be married AT the time of conveyance d. EXAM: A. If question says jointly or O conveys to A, B and C as JT (Manhrenholz) have to look at Os intent to see whether TIC or JT, then 1. 2 prongs: a. Go through it as a TIC analysis b. Go through it as a JTWROS analysis i. Are 4 unities present 2. When was the conveyance?

a. CL: favored JT b. Modern: Favors TIC i. Statutes provide that a grant or devise to 2 or more persons creates a tenancy in common unless an intent to create a JT/ TBE is expressly declared e. Harms v. Sprague: A & B own Blackacre. A takes out a mortgage for another property against Blackacre (B is unaware of this). A dies intestate and without paying off his mortgage A. Generally, a mortgage is the same as a deed of trust except in this case 1. Mortgage (NY/ Modern): a granting of a lien, NOT a conveyance, an encumbrance but lender does not have title 2. Deed of Trust (CL): title is conveyed from borrower to lender (lender holds deed in a trust with a right to convey back upon payment of debt) B. If in NY, B gets As interest when he dies not subject to a mortgage lender gets nothing 1. Banks usually require all JTs and TICs to sign the mortgage/note if taken against that property iv. Partition: a. Only available to JT and TIC, not TBE b. When ONLY one wants to sell c. Common Law: co-tenants have a right to partition = the right to force a separation of the cotenants d. 2 Types of Partition: A. Partitions by Sale: 1. Forcing a sale / forcing a forfeiture 2. Common Law right, but waivable 3. Property Law doesnt encourage this 4. Court will find Sale when the sum of the whole is greater than the sum of the parts a. When Kind would be inequitable b. Interest of ALL owners would be better promoted by sale B. Partitions by Kind: 1. Property is unique, money wont suffice, dont want to force a sale 2. Property law encourages Kind over sale e. Delfino v. Veakencies: A and B = TIC, A has a garbage company on the land, B wants to sell the land. Easily dividable, but the value significantly decreases because the garbage company will stay. If partition by sale, then the whole lands value increase because no more garage company and can sell as residential A. Court ordered Partition of Sale because the sum of the whole was greater than the sum of the parts v. Sharing Benefits & Burdens: a. Share any rent profits according to interest in property A. POSSIBLE Q: One co-tenant improves the land. Other doesnt have to help pay, but when they sell the land, the improver will get more money proportionally. If the improvement decreased the value, he bears the loss of the value b. A and B = TIC of a warehouse. Their Tenant leaves, and A starts using it. B demands rent A. TIC = separate but undivided interest in the whole B. Rule: absent of an agreement to pay rent or an ouster of a cotenant, a cotenant in possession is not liable to his content for the value of his use and occupation of the property 1. Ouster = must prove A prevent B from enjoyment for ouster to apply C. Majority View/ NY: Not liable to pay rent (only demanded rent no ouster)

1. NY: need to have an act or ouster to show hostility that A is in exclusive control for A to claim AP of whole interest D. Minority View: Liable to pay rent after asked to vacate V. PRIVATE LAND USE CONTROLS: on EXAM: easement right to use someone elses land give def easy point A. Private Agreements: i. Usually involve 2 or more parcels of land. Usually burdens one parcel to benefit the other (EX: using As driveway to get to your home) ii. These agreements create interest in the land, binding and benefitting not only the parties involved in the agreement but also their successors a. These interest are called servitudes B. Servitudes = Interest in land: i. Background: a. CL refers to 2 types of servitudes: i. Easements ii. Covenants 1. Covenants enforceable by law (Real covenants) 2. Covenants enforceable in equity (Equitable servitudes) b. What the CL refers to as easements/ covenants we now refer to as servitudes i. The lines/ differences between enforcing a covenant at law and a covenant in equity have blurred (with evolution, the courts have merged, no longer have different judges/courts) C. Easements: an interest in someone elses land for a specific purpose WRITTEN EASEMENTS: i. General: a. If A crosses Bs land and B doesnt like it, A is a trespasser. B can put up a fence to keep A out. If A has an easement to walk across Bs land, B cant interfere with that easement b. Usually easements are in the deeds because they are created at sale, so when you are title searching, want to real all the deeds so you know what the easements are ii. Created: ALWAYS in writing (grant or express) unless an exception a. Statute of Frauds needs to be in writing (exception = Estoppel, implication & prescription) and signed by the party bound b. An easement in writing is can only be one piece of paper easy to get A to sign a piece of paper instead of going to court for an easement of implication or prescription 1. CL: must say to A and his heirs or else only easement for Life estate EXAMPLE: A owns 100 acres. A----- 50 acres--- B A still wants to be able to cross Bs land to get to the bus 2. Writing (Express Easement) can be done in 2 ways: common law 1. Grant: a. Benefit = Grantee Burden = Grantor b. 2 step process: A--------FSA, easement --- B (B immediately turns around and grants A an easement) A --------easement--------- B 1. Reservation: a. Benefit = Grantor, Burden = Grantee b. What you can do in 2 steps in 1 step A -----------FSA, reservation ---- B

c. CL = either the beneficiary has to be the grantor or the grantee not a 3rd party 1. Exception to the CL Rule = Willard Jurisdiction (court declared benefit of an easement can be given to a 3rd party) A -----deed, easement (benefitting 3rd party X)---B -----deed--- C a. First find the parties intent was the intent to benefit the 3rd party? b. If the intent shows A wanted X to benefit, ask if C was a BFP - when he bought the land, had C searched, C would have found the deed from A- B containing the easement to benefit X (Church) 2. If same example, but not in a Willard Jurisdiction 2 ways you can get around the CL Rule: 1. B-----FSA------- X who immediately ------- reservation ---C 2. B --------FSA ----C -------easement --- X D. Types of easements: i. Affirmative Easements = the right to enter land that isnt yours and perform an act ii. Negative Easement = forbidding you to perform an act on your own land a. CL only recognized 4 negative easements (light, support, air, water) b. Modern: US now has recording Systems so expanded, but not by a lot ) iii. Appurtenant Easement = Easement runs with the land a. The intent of the easement is not particular to that person / owner but to burden/ benefit anyone who owns the property after b. A person is benefited from the use and enjoyment of the land rather than by the easement c. If A has the benefit and sells his property to X, X gets the benefit d. Requires 2 tenements: 1. Dominant Tenement = benefited 2. Servient Tenement = burdened e. Requires 2 adjoining tracks of land (Grantor doesnt matter) one is burdened one is benefited f. EX: for church purposes 1. If Christ Church moves and Jesus Church buys the property and builds a church, Jesus Church can benefit from the easement. If a restaurant moved in instead, they cant use the easement because it says church purposes iv. In Gross Easement = Gives a right to a particular person/ purpose without regard to ownership of the land a. Benefits the easement owner personally rather than in connection with the use of land b. Person is benefited by the easement/ privilege not the land itself the land is giving me nothing, its what I am allowed to do on the land that is giving me some benefit (placing a sign) 1. EX: I hereby grant an easement for the Christ Church 1. If Christ Church moved down the street, they can still use the easement on the previous property but no one else can it is particular to them 2. EX: I can give Val an easement in gross to place a satellite on my house in Seattle to take naked pictures of my mom E. Easement vs. License: i. License = ALWAYS revocable a. Under what circumstances does an irrevocable license turn into an easement? WRONG a license is never revocable NEVER will turn into an easement because an irrevocable license doesnt exist 1. An irrevocable license = an easement by estoppel

1. Grantor is keeping/ reserving the interest in Bs land

1. 3 elements for a license to be irrevocable: a. Intention b. Equitable Estoppel i. If a licensor grants a license on which the licensee reasonably relies to make substantial improvements to the property, equity requires that the licensor be estopped from revoking the license c. License coupled with an interest 2. A license by nature = revocable ii. Easement = irrevocable if it runs with the land, appurtenant a. Once you have found there is an easement, it is irrevocable F. Easement By Grant: Must be in writing SOF which requires a writing signed by the grantor most are created expressly by deed or other grant. a. Grant Grantee Benefits b. Reservation Grantor benefits (Willard) i. Reservation to a 3rd party 1. Minority/Willard a. An easement by reservation to a 3rd party IS allowed. 2. Majority - a. An easement by reservation to a 3rd party IS NOT allowed. G. NO WRITING exceptions to the statute of frauds, judge made easement i. 3 exceptions: a. Easement by Estoppel (Hollbrook v. Taylor) 1. A gave B a promise/ license and B reasonably relied on that promise and spent money 2. When a license becomes an easement 3. It would not be reasonable to rely on a revocable document 4. Duration: 1. The traditional rule has been that a license made irrevocable through equitable estoppel exists as long as is needed to prevent unjust enrichment, which generally meant that the license exists until the value of the reliance expenditures has been exhausted. 2. The modern rule treats irrevocable licenses identically to easements unless the parties intended or reasonably expected that the license would remain irrevocable only until the reliance expenditures had been removed. b. Easement by Implication: 2 types/ ways 1. Easement by Prior use (implied from use)/ Quasi- easement: (USNCRN) 1. Common Ownership of Dominate and Sevient estates in the past AND Parcel was severed into 2 or more parcels in connections with conveyance 2. Use by common owner of one parcel to benefit the other (if O didnt own both, it would just be an easement, not a quasi-easement) 3. Notice: Use was apparent (more than visible) 4. Continuous analyzed at the time of severance/conveyance any fact that happens after the time of severance is a distracter! 5. Intended Continuation 6. Reasonably Necessary doesnt end when necessity ends a. CL: i. Implied Easement by Grant = reasonably necessary 1. Adding to Bs land extra bonus ii. Implied easement by Reservation = strictly necessary 1. Denigration of express words in the deed b. Modern View: Grant or reservation = reasonably necessary i. The why of the use: how important is the use to the enjoyment of the property?

ii. How important is it that we will overlook the SOF to find an easement? c. Reasonable expectation of the parties AT THE TIME OF SEVERANCE. d. If the use of the parcel changes in the future, it does not affect the easement (unlike an easement by necessity where the easement ends when the necessity ends) 2. Easement by Necessity (Implied from necessity) (USLST) 1. Common owner of 2 parcels in the past 2. Conveyance of Part of Grantors conveyance caused it to be landlocked - no access to a public road 3. Notice dont need to have notice of the use of the easement 4. Strict Necessity a. Some Js allow E by N if other access exists but inadequate, difficult or costly b. Some Js water access would preclude E of N, other Js it wouldnt 5. CL/ Othen: applied strict necessity, The necessity must have existed at the time the estate was created (at the time of severance) 6. Terminates when necessity ends 7. As a public policy matter, the courts will choose to place an easement through the last parcel sold that causes X to be landlocked. c. Easement by Prescription: Same as AP, acquire with time, except for hostile and exclusive not right to land, but right to use land: 1. Actual Entry/ use resulting in 2. Exclusive use of servient estate (not excluding TO or others, but not a public right) 1. Not necessary for AP to prove that only AP, and not the TO, used the easement. 2. If the TO uses the pathway along with the AP, that is consistent. 3. Whether or not the public regularly used that road, or if that easement was of exclusive benefit to the adverse possessor to the exclusion to the greater public. 3. Open and Notorious 4. Continuous (without interruption) for statutory period 1. On exam, look for well worn paths, tracks, etc. 5. Hostile and adverse (as opposed to Permissive) 1. Hostile requirement: 2. Majority: all use is presumed non-permissive (similar to AP) a. EX: TO says you can walk across my land, not an easement, rather a license 3. Minority/ Lost Grant Theory: unexplained use is presumed permissive a. Owner is presumed to have consented or acquiesced to the use, BUT if made with consent, then no hostility so AP / claimant must show: i. No Affirmative Consent / use was not permissive (DO NOT show that TO actually said no), AND ii. TO acquiesced (did nothing about it) 1. To prove both of these is hard: to show that the TO did not consent, but at the same time did not do anything about it. b. A letter, fence anything can show no consent, but then also shows TO didnt acquiesced c. Easy for TO to win to show no consent basically also show no acquiesced 4. Stopping the clock in different Js by different standards: a. Majority: i. Must effectively stop the use; need to actually build 12 foot brick wall (destroys APs continuous element)

ii. OR - TO must bring the cause of action b. Minority: i. Jump up and down and say no, stop, dont! (even if you dont effectively stop the user)(usually best done by sending a letter also provides written proof) 1. Any action that indicates that there is no consent (destroys the acquiescing element, by showing that the TO is NOT aquiescing) ii. OR prove there is consent c. Know the difference btw the two. H. Remedies: Specific Performance, Money damages I. Does a subsequent BFP take subject to an easement created by operation of law (not in writing)? a. Why is this important? -- Marketability, Deed Cov. Breach because if the easement doesnt bind the subsequent party, they do not have the right to sue. b. Arguments in favor of YES: i. You cannot use the recording statutes because recording statutes only apply to conveyances, and an easement is not a conveyance. c. Arguments against: i. Buyer was not on notice of it ii. (Equitable arguments) VI. Real Covenants& Equitable Servitudes: 1. The 2 are the same except for their remedies. 2. Both have the following elements: A. Intent for the promise to run with the land B. The promise must Touch and Concern the land i. CL: Interest must actually relate to the land and benefit or sustain it ii. NY: Interest can extend to contributions to fund neighborhood upkeep burdened parties/ people in hood have an easement in common to use the public areas therefore they are benefitting C. There is a writing within the statute of frauds 3. Exam: Show which party has the benefit and which party has the burden 1 point 4. Basically the same thing, the remedy one seeks will tell you which one you have RC/ law ES/ Equity COMMON ELEMENTS 1. Intent to run with the land 2. Touch and Concern 3. Written satisfies S of F - NOTICE DIFFERING ELEMENTS Privity Required Privity NOT Required Remedy damages Remedy injunction Can impose aff or neg duty CANT only impose aff duty RESTRICTIVE COVENANTS: License Easement RC/ES Personal revocable Interest in land Agreement to do/ not do something on the land privilege to enter granted to another anothers land for special use CHARACTERISTICS: Easements RC ES Intent to create YES (but notice YES methods of creation

Notice Written Horizontal Privity 1. Mutual P. = common owner 2. Instantaneous P. = like an assignee Vertical Privity

that do not expressly reflect intent e.g., estoppel and prescription) YES YES - 3 exceptions N/A

N/A

Touch & Concern

Remedy

In Gross/ N/A (appurtenance fulfills this requirement) Specific performance

YES YES Implied in some J.s YES for burden. NO - Some Js for both - Some Js & 1st Restatements only for burden - Some Js & 3rd restatements no HP YES both (strict for burden, NO relaxed for benefit) Burden: only enforceable against someone who has succeeded to the same estate as that of the original promisor (O had FSA must be FSA) YES: need intent to run with land, cant just say runs with land and that is enough for T and C Money Damages Injunction ( but now most courts can award damages or injunction)

Real Covenants: RC not enforceable against an adverse possessor.

For AP, Restrictive Covenant would run with land because AP would be in vertical Privity with TO and AP acquires all of what TO had Real Covenants Class notes: o Mutual Promises o Affirmative promises or Negative promises: I promise to maintain stone wall I promise not to build anything taller than 2 stories. o Promisee receives the benefit benefits the promisees land o Promisor is burdened burdens the promisors land o In order to sue on a real covenant, the parties must be in P/K, and the contract principles apply promise, offer, acceptance, consideration, breach, damages o A(promisee) --- B (Promisor) Benefits and burdens run if: o Intent to Run (express or implied) o Notice (in part because of recording statutes) o Writing (subject to statute of frauds) o Privity of estate (Horizontal and Vertical Privity)

Equitable Servitudes: Negative promises are treated the same as easements: All owners and possessors of burdened land are bound by negative covenants regardless of the extent of their interest or the manner in which they obtained their interest. Affirmative Promises: To lessees: The benefit of covenants to repair, maintain, or render services to the property run to lessees. So do the benefits that the lessee may enjoy without diminishing the benefits value to the lessor (example: maybe benefits that the lessor wanted to personally provide to the original lessee?) and without materially increasing the burden of performance on the person obligated to perform the covenant. On the burden side, the only affirmative covenants that bind lessees are those that can more reasonably be performed by a person in possession (maybe because he is in possession, it is easier to perform covenant because he is on the property and original lessee is not) than by the holder of the reversion. To Life Tenants: Both benefits and burdens of affirmative covenants run to legal life tenants. The life tenants liability for performance of an affirmative covenant is limited to the value of the life estate. Adverse Possessors: AP who has not yet gained title is liable on the affirmative covenants burdening the property. Benefit of affirmative covenants run to AP who has not yet gained title only under limited circumstances: The benefit of covenants to repair, maintain, or render services to the property run to APs. The benefit is one that can be enjoyed by the person in possession without diminishing the benefits value to the owner of the property and without materially increasing the burden of performance on the party obligated to perform the covenant. **All the appurtenant benefits and burdens of servitudes burdening the land when AP began, run to APs who have acquired title.** Can B enjoin A from building a factory? You cannot do a real covenant analysis because you cannot get an injunction. With ES, do an analysis for both damages and injunction.