Professional Documents
Culture Documents
Basics
a. What is property a social contract, a signal to mark boundary of, a way to define
social relations, helps with economic efficiency, a measure of wealth. It is the way
we define our relationship to the outside world. Its our relationship to things.
Landlord/Renter they each have a relationship to the apartment and they are
different. Its a way for people to signal to others in the world our interests.
b. The purpose of property rights is to enhance social welfare by maximizing the
value of scarce resources.
c. Title; Concept of title goes to rightful possession, possession is 9/10 of the law,
must have a moral and legal claim/right to the property. The notion that being
there first somehow justifies ownership rights. First in Time is First in Right. If
you are in possession of a good you are presumed to be the owner of said good.
d. Property does not evolve well because property is a long term interest; property
rules change little and contain a mix of various rules. Ownership changes could
impact society suddenly you dont own your home, etc.
e. If you own something, you can exclude someone from owning the thing you own.
f. Values we keep in mind when considering property:
i. Personhood
ii. Political Liberty
iii. Economic Efficiency
g. Why Have Property?
i. Communal ownership - everyone will seek to maximize his rights to the
property by over hunting or over tilling the land because the costs of doing
this is borne by others. Externality Someone gets all the benefits and the
loss is born by all owners of the common property.
ii. Private ownership - the owner will take into account the chance to
maximize the value of the land for the future.
iii. The Utilitarian theory of property the primary function of property rights
is to promote the efficient use of resources.
iv. Property defines who we are and defines a relationship.
v. Tragedy of the commons - When you dont own things you abuse them
EX. a rental car. when no one has any interest in the resource people
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may take too much or dont treat it with respect. (example = overfishing)
(Rhinoceros farm hypo)
vi. Tragedy of the anticommons where there is too much private ownership.
h. Property Rights as a Bundle of Sticks
i. These rights include:
1. Right to Possess
2. Right to Use
3. Right to Exclude
4. Right to Transfer
i. Positive/Negative Externalities These exist whenever some person, say X,
makes a decision about how to use resources without taking full account of the
effects of the decision. X ignores some of the effects some of the costs or
benefits that would result from a particular activity, for example because they
fall on others. They are external to X. As a consequence of externalities,
resources tend to be misused or misallocated, to societys detriment sometimes.
j. John Lockes Labor Theory of Property: When a person takes an apple from the
commons he appropriates a property right in the apple because he has mixed his
labor (which he owns) with the previously unowned apple and thereby made the
apple his own.
Property Acquisition
1. Conquest
a. John v. MIntosh (1823)
i. Two people cannot claim the right to the same piece
of the land.
ii. Why does First Time matter? Kinda like a marker
I was here first! it promotes
competition/investment
iii. Cannot give or sell more than what you have
(Indians did not have the right to sell the land, only
rent it)
iv. The line of title, traced from the US, to Britain, to
Spain and to a point where no one owned it. Gotta
trace it back to find the ownership.
v. Basically the Indians abandoned their right of
occupancy and the US owner could take that right
away.
vi. Conquest is no longer recognized under the law.
easy administration. Had this rule for a long time. What does it
mean to be first? When courts talk about possession that is usually
a conclusion, not a beginning.
b. Downside may led to inefficiency, and antienvironmental. Arbitrary rule but not anymore arbitrary
than other rules of property. Does rely on power, the
powerful are more likely to get to the land first.
c. Pierson v. Post (1805)
i. Posts mere pursuit gave him no legal right to the
fox. If Post had used traps to capture the fox, or
wounded the fox, he would have possession of the
fox and a legal claim to it. Must render the animal
unable to escape that would equal possession.
ii. Mortally wounding = manifesting intent. You must
do something to get it into your possession.
iii. Society benefits from hunters of noxious beasts
we want to reward those that began the hunt.
iv. We want administrative ease promotes peace,
certainty and fairness.
v. Hunters and participants have their own settled
expectations so custom is important. Customs
play a big part in this
d. Popov v. Hayashi
i. Issue: If an actor undertakes a significant but
incomplete steps to achieve possession of
abandoned personal property and the effort is
interrupted by the unlawful acts of others, does the
actor have a legal pre-possessory interest in the
property? YES!
ii. Conversion is the wrongful exercise of dominion
over the personal property of another. There must
be actual interference with the plaintiffs dominion.
Wrongful withholding of property can constitute
actual interference even where the Defendant
lawfully acquired the property.
iii. MLB intentionally abandoned the baseball. The first
person to come into possession of the baseball
became its new owner.
iv. In this case, each man had a claim of equal dignity
in the baseball an equal undivided interest. The
ball was sold and the proceeds divided equally
between the two parties. Popov should not have
b. The right to property if nothing else is the right to exclude others. For any
reason
c. Society also has a strong interest in protecting private property from
intentional trespass. This is so to preserve the integrity of the legal system.
d. We have rights in private property (The Bundle of sticks) and the Right to
Exclude is the central stick in our bundle.
e. Right to Exclude is not absolute
i. State v. Shack (1971) The migrants are a disadvantaged segment of
society, their right to see a visitors by their own choice cannot be denied.
The two were acquitted of trespassing charges.
ii. Property rights serve human values.
iii. The Right to Exclude does not include barring people from government
services. The Right is fundamental but not absolute.
iv. Cannot give complete dominion over people that the owner lets to enter
the property.
f. Result oriented judging is bad. The courts want a general rule that can be applied
to everyone.
g. Property rights must be decided to benefit society the most. Courts still weigh
economic efficiency for all of society, private property is more economic efficient
as a whole.
HYPO: Treat the migrant workers as renters sharing a common hallway.
Fugitive resources
1. Oil and gas are looked at the same way as wild animals; whoever
captures it owns the resources.
2. Oil a field split between two properties, the seconds propertys
only recourse to pump the oil faster than his neighbor. But the oil
will be used up quicker.
3. More common today - Courts have ordered that the pumper will
have to share a percentage of the oil other with the other neighbors,
so it does not matter how much oil he pumps the neighbor still gets
a cut, better use of resources.
4. Water whoever captures the water first owns it, unless they
actually harm their neighbors.
2. Usually in all those instances we award the rights to the person being First in Time.
However, what it means to be First is highly situational and we look to things like
control, administrating the rule and things that are instrumental
3. When courts talk about being in possession that is usually a legal conclusion rather
than a predicate. You can hold onto something without being in possession of it, for
example. Courts can conclude this depending on the instrumental means Courts are
looking at the ultimate goals that we are trying to serve they like the overall result than
the individual result. Example Moore case the science rights were seen as more
important than Moores personal rights.
4. Property rights are thought of as a bundle of rights including the rights to exclude (most
important), the right to include, right to sell or transfer or gift, right to use, etc.
(Examples) Public policy = not all sticks are present in every bundle. But at the same
time, a mere absence of some sticks does not mean an absence of ownership rights (cant
destroy cat but you still own it).
5. Property rights especially the right to exclude are often on a collision course with
other peoples rights. Its the most important right but we often come to a point of
whether or not we are going to honor it. We then look at the overarching goal here.
Example you can sell your blood but not your kidney. You can get a patent on bacteria
but perhaps not on DNA, etc.
i. Moore v. Regents of the University of California (1990) Cell line case
1. The court cites a Federal law that states that body parts cannot be
sold. Property is not the thing but a bundle of rights. Since you
cant sell tissue, it is no longer property. Medical research was
more beneficial to society than Moores right to his cells, which
would have been thrown away anyway.
2. No expectation to ownership the cells/body parts are typically
disposed. You dont expect to retain your spleen for example.
Also, his cells arent unique to him (different from the persona
argument). The cell line is patented and legally distinct from
Moore by virtue of the patent itself. Bottom line: Once tissues
come out of our body basically you dont own them.
3. Does a claim for conversion lie for the use of a plaintiffs bodily
tissue in medical research without his knowledge or consent? No.
A claim for conversion does not lie for the use of a plaintiffs
bodily tissue in medical research without his knowledge or
consent.
4. Under the duty to obtain informed consent, must a doctor disclose
his intent in using a patient for research and economic gain? Yes.
Under the duty to obtain informed consent, a doctor must disclose
his intent in using a patient for research and economic gain.
5. To establish conversion, plaintiff must establish an actual
interference with his ownership or right of possession. Where
plaintiff neither has title to the property alleged to have been
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9.
Patents/Trademarks
Patent Application must meet fire requirements in order for the patent to be granted:
1. Patentability this means that the invention fits in one of the general categories of patentable
subject matter. Patentable inventions are limited to these four, process, machine, manufacture,
or any composition of matter. This has been extended to include genetic materials like DNA
sequences, proteins, and business methods. Laws of nature and abstract ideas are not patentable.
2. Novelty this means that it has not been preceded in identical form in public prior art.
3. Utility this is a minimal requirement that is easily met so long as the invention offers some
actual benefit to humans.
4. Non-obviousness this is the most important requirement; it asks whether the invention is a
sufficiently big technical advance over the prior art.
5. Enablement this requires the patent application to describe the invention in sufficient detail
so that one of ordinary skill in the art would be able to use the invention.
Class Review of Diamond v. Chakrabarty Case
Progress in science is furthered by providing incentives to people/scientists. By doing this, more
people will toil in their labs and society is rewarded. To do this, we can provide them with
property rights, etc.
Case reviews what kind of life can we own? Should we be able to clone sheep? An entire breed
of animal? Or go down the chain strings of DNA.
Remember the policies underlying property law and there are two sides to the argument why
we should be able to sell kidneys and why we shouldnt. At the end of the day we must
examine our instrumental ends what are we trying to accomplish here?
Qualitex Co. v. Jacobson Products Co Case
Can you trademark a color? Of course! There is no rule absolutely barring the use of color alone.
Trademark lasts as long as you use it no expiration date - could be forever. Patent is only for 20
years.
Look at the context of the case. Qualitex owns the color for drycleaning pads not in general. In
the abstract could sound ridiculous.
II.
HYPO: Armory stole the ring. He says he found it but he really stole it. D keeps it. Same
outcome or different? Yes, same. Theres no difference. Policy values is it good to steal from
thieves? Better outcome which thief should win first thief or second thief? First in line
maybe? Because it promotes less violence. Yes, first thief should win even though it promotes
thievery it also promotes peace.
HYPO: Delamire pays Armory for the ring. True owner comes into Delamires shop, sees his
ring, shows evidence and he wants it from Delamire. D tells true owner to get from Armory
since he already paid for the ring once. Who wins? True owner should.
HYPO: What if Armory comes in, seals from true owner, court orders him to pay; then real
owner shoes up and wants the item. Result?
This case stands for your rights are relative to other people and to the actual item other issues
arise, rewarding thievery and what happens when someone pays the value and the true owner
shows up for the item, too.
HYPO: If you buy stolen goods (even if you dont know they are stolen) and the true owner
shows up, they have a better ownership right compared to you.
Lost Property
6. Hannah v. Peel (1945) (Kings Bench) (p. 101)
a. The court wants to reward the honest person. Peel never
had possession of the broach. Key to the case was the item
was on top the property, not buried in the land.
b. The finder of lost property has superior title against the
owner of the land on which it was found.
c. While a man possesses everything attached to or under his
land, he does not necessarily possess a thing lying
unattached on the surface. There is no doubt that the brooch
was lost property. Peel had neither prior possession of the
brooch nor possession of the premises in which it was
found at any time.
d. The key issues in the analysis are possession (not
ownership) of the land, status and knowledge and the
circumstances of the discovery. Peel owned the real estate
but was never in possession of it.
e. Lost property you didnt intend to drop the wallet on the
floor and it inadvertently slipped out of your pocket. The
finder wins except against the true owner. This is because
the true owner is unlikely to retrace their steps and it also
rewards the finder for their honesty.
7. Possession is either you possess the item or you dont possession.
All or nothing system, the case could come out either way.
8. Ship Wreck English Law ship wrecks were property of the King.
In the US, if the ship settled on the bottom it remains the owner
property until title is abandoned.
9. Finder has better claim, than the true owner or a previous
finder.
10. An item is said to be lost when the owner inadvertently loses
possession of it. Lost property usually goes to the finder because
the true owner, who does not know the items whereabouts, is
unlikely to retrace his steps and find it. This also rewards the
finders honesty.
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Mislaid
11. McAvoy v. Medina (1866) (p. 107)
a. Mislaid - the court wants to give the item to the person who
would most likely return the property to its rightful owner.
The store owner was that person.
b. Lost vs. Mislaid forgotten property vs. lost property,
mislaid might encourage people to never turn in property
found, just keep it.
c. Lost vs. Mislaid is very fact based, is based on the facts
of the given case.
d. Mislaid property if you intentionally placed it somewhere
(with the full intention to pick it back up) and when you
were leaving you forgot to pick it up. If mislaid, the locus
in quo wins. The rationale is that this helps the true owner
to find their mislaid item since they can re-trace their
steps. This is our ultimate goal to restore the mislaid
property back to its true owner.
12. Finder has better claim, than the true owner or a previous
finder.
13. An item is said to be mislaid if the owner intentionally placed it
in some location and then forgot to retrieve it. If mislaid, the
true owner wins the rationale is that this result aids return of
the item to the true owner, who will usually retrace his steps to
where he last left the item.
14. Abandoned property is when the owner intentionally relinquishes
all legal rights to it with no intention to confer rights on any
particular person. Abandonment occurs all the time such as
tossing item in trash. When a person finds abandoned property
ownership goes to the finder.
2. In order to acquire land or chattels by adverse possession, one must satisfy the following
requirements: a) there must be an entry; possession must be open and notorious; it must
be continuous; it must be under the claim of title; it must be adverse to the true owner;
and it must be for a requisite period (different for each state).
3. Hostility or adversity does not mean hatred or enmity for the true owner; instead, all it
means is that your legal claim to this land or chattel is incompatible with the true owners
claim to the same land or chattel. The true owners superior title makes your occupancy
not hostile.
4. Continuous need not be constant; you can go out for milk or even take vacations. Instead,
all that is required is that you use the property as the true owner would. Summer
cottage/winter cabin used in those seasons. Exclusivity is part of this you need to have
this.
5. In order to satisfy the statute of limitations, subsequent possessor may tack or add their
time to that of the preceding possessors, provided that they are in privity with each other.
6. Chattels may also be adversely possessed but what counts as open and notorious may
simply be a more difficult question. There are different rules but the New Jersey
Discovery Rule is the dominant rule.
7. Legal disabilities on the part of the true owner toll the statute of limitations/stop the
clock. Again, provided that the disability existed at the time the cause of action accrued.
At the time the true owner couldve gone to court to expel the interloper. This rule means
that disabilities cannot be tacked to one another. You only get one. If you are disabled for
more than one reason, you can pick whichever one is longer as long as they both
existed at the time the cause of action accrued.
The Rules of Adverse Possession (he didnt go into exclusivity at first)
1. There must be a physical entry. Not good enough to just do a check mark you must
have entry. This serves a function of notice because without this, how can a true owner
enforce his rights?
2. Entry must be open and notorious. You cant sneak on the lawn every night for 20 years
and then say its yours. (also about notice).
3. Must be continuous. You must live there for the requisite period of time (depending on
State) continuously. You dont have to live there constantly you can leave to get bread,
etc.
4. Must be under the claim of title (claim of right). You must have a claim that you have a
right to be there. You dont need a piece of paper (thats called color of title) but you must
claim that you are doing it under some right.
5. Must be adverse to the true owner (this is the weird part). The two parties dont hate each
other but the adverse party doesnt have the true owners permission. If on the last day
before adverse possession would be had and the true owner says You know, you have
my permission to stay here then you would lose your adverse possession. The two
claims are incompatible with each other, basically.
6. Must be exclusive you treat the land as a true owner would/does. Basically you cant be
sharing with the true owner/public.
i. The Theory and Elements of Adverse Possession
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ii. A statue of limitations in which a land owner can no longer bring action
for recovery of land.
iii. The rule is the opposite of first in time. But without the rule, then 20
years down the line, the true owner of the property could kick the
possessor off the land, without any compensation. The true owner had no
economic benefit from the land, while the possessor did.
iv. Promotes efficient land use to use for building, agriculture something
productive. You dont want to promote fallow/abandoned land. (focuses on
the adverse possession owner)
v. Requirements
1. Actual
a. SOL starts to run with an entry, must be an entry. Unless
you enter the true owner does not know his property is
violated.
b. Statute of limitations waits until the true owner knows of
the encroachment or a reasonable owner would notice it.
Thus, you wont start counting the years/statute of
limitations until this standard is met.
2. Exclusive Possession
a. Adverse claimants possession and use cannot be shared
with the true owner or with the public in general
3. Notorious and Open
a. Entry must be open notorious, and visible, so the owner
can sue you for trespass.
4. Hostile and Under Claim of Right (Adverse) (Most confusing
Element)
a. To the true owner, not by permission (license) of true
owner. Hostile means your claim of title is incompatible
with the true owner. If you sell the land your possessing the
true owner cant sell the land as well.
b. Approach inquiry from the terms of the state of mind of the
adverse possessor.
c. Doctrine reflects three different views on this: i. Objective
Standard - State of Mind is Irrelevant (Majority View):
Conduct of adverse possessor is all that matters; if the
adverse possessor occupied and used the law in the way
that one would expect of the true owner of the land then
that evidence is sufficient to establish adversity; ii. Good
Faith Standard I thought I owned It requires a goodfaith claim; Aggressive Trespass Standard I thought I
didnt own it but I intended to make it mind.
d. Hollander v. World Mission Church Case
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1. Mistaken belief
2. Encroaching on neighbors property
3. Purposefully attempting to take the land as yours
ix. Van Valkenburgh v. Lutz (1952) (p. 122) case where the court failed to
understand adverse possession.
1. Fulkerson v. Van Buren - FACTS: VB claimed AP b/c he took and
improved church on F's lot. HOLDING: No AP b/c church lacked
requisite intent since during occupation they recognized the
ownership right of titleholder (asked for quit-claim deed). Also,
VB not clear as to intent. Court implied that church congregation
claiming title did not meet hostility requirement, in part, because it
"was unsure of the precise nature of its interest in the land."
a. Claimant must have exclusive control what does this
mean and why is it important? Because its like they are
acting like they are the true owner they can exclude other
people, and take other actions as if they own the property.
They must treat the land as a true owner would have.
b. Court says: Hostile means its the intent to hold against the
true owner. Hostile doesnt mean dislike or ill will.
Hostility in adverse possession it means that you have a
claim of right that is incompatible with the true owners
claim of right. We dont reward squatters. You actually
think that the land is yours and your claim of right is
hostile against the true owners claim of right. Mere
possession without more is not enough to show adverse
possession. Mere possession without more does not mature
into ownership.
c. Look at the different values/underlying policies. The
building afterwards deteriorated and remains unoccupied.
Plus, the hard work of Van Buren improved the area and
society. So the values of the occupant and the owner clash
here. So should we be concerned about reward or
punishment. Should we reward Van Buren since they put
blood, sweat and tears into the land? Should we punish
Fulkerson for sleeping on his rights?
x. Some American courts do not allow a squatter or trespasser to ever
get adverse possession.
1. The courts required either one of three states of mind for adverse
possession:
a. State of mind is irrelevant (objective standard)
b. I thought I owned it (the good-faith standard)
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The problem with a half-a step is its not really open and notorious because the human
mind may not be able to foresee the half step issue. Thus, is this enough to put the owner truly on
notice and to meet this requirement? How are you supposed to know survey your land every
year? (crazy expensive).
HYPO Underground Entry: What do you do if someone enters your land by going
underground into the cave that goes under your land?
Two plots of land and there is a cave underneath them. Owner of Plot A starts exploring the cave
past his property line so under As land and under Bs land. After 20 years, A seeks to quiet title
to the underground portion of Bs land.
Answer: Maybe its enough to know about the cave entrance. But B wasnt really put on notice
this doesnt mean the open and notorious requirement of adverse possession. Remember, B owns
the property, all the way down to the center of the earth. A is invading Bs property hes
treating it like a true owner (Charging money for tours) but B hasnt been put on notice. What
would a reasonable owner know? Technically, B has no right to demand A to allow entry. A is not
obliged to give B permission to enter the cave, either.
Privity HYPO (this was on an old exam): What if you like spending winters in your summer
cottage so you dont realize if someone is staying in your summer cottage?
Answer: Analyze just like Howard v. Kunto but there is an issue as to the timing it comes up
to once you move away from constantly other problems arise.
Once we move away from hard and fast rules you realize what values are important.
Often not about the mirror application of rules but looking at the core values/instrumental goals
that we are serving here
If this was a single piece of land, owned jointly by X and Y, then A could win due to his color of
title and his physical possession.
Would it matter if A has a valid deed for lot 1 from X and an invalid Deed to lot 2 from X. Who
wins? Y would still win he has no way of knowing that A thinks he owns both.
Always ask yourself would the true owner have a case to bring against the adverse possessor?
Would they know about it, etc? If yes, then the statute was running.
Disability Problems Page 133
1.(a). Disability ends upon Os death in 2007. H has 10 years to enforce through 2017.
1.(b). Disability ends upon Os death in 2007. Cant tack disabilities (insanity and minor of O) so
PR can bring claim through 2017 (on Os behalf since hes a minor)
2. O was under no disability so the statute of limitations doesnt stop until it ends which
would be 2005 (21 years per statute).
3. Can do either whichever is longer. Answer is 2007. Not because its 18 + 10. You have to
make sure the total 21 years has run. Count from 21 years from the date someone occupies your
land and 10 years from when the disability ended. The disability has to have existed at the time
the cause of action was accrued (when he couldve gone to court to evict the interloper) so
here, the insanity disability doesnt matter.
4. The advice you would give to B is whether O labored under any disability? A can still be
ousted depending on that you really want to find out what the heck happened to O.
Reviewing Problem #3 again:
You have to look at both periods you must pick the longer of the two or the end of your
disability plus whatever the state gives you. You have to look at both. The statute only runs until
the later of the two expires.
1997 = O is age of majority plus the 10 years allowed under the Disability Rule. 2007 is after
2005 so thats when it expires.
So how is this fair? We deal with this by appointing Guardians through the
State/Family/Trustee to protect the legal rights of those vulnerable in society.
Acquisition by Gift
i. Property can be transferred by gift but formalities must be satisfied.
Those formalities are intent to give the gift; delivery of the gift; and
acceptance of the gift. Delivery must be as actual as practicable; with the
extent that you can hand over the property you must; otherwise there
was no gift.
ii. Two types of gifts:
1. Gifts given during your lifetime (Inter-Vivos);
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Van Pelt says to Julia I want to give you my little strong box here and the insurance policy
locked in it. Here is the key. Julia takes the key but the box stays where it is. Valid gift?
Answer: The bunch of keys that the donee got none opened the strongbox. Court said gift was
not made; maybe the box itself couldve been delivered and they failed this. She couldve tested
the box before he died to make sure courts could swing the other way if box is at the bank.
Problem #4:
Van Pelt said to his wife before he died, Dear, I give you my piano. Would there be a gift?
Answer: The wife has joint dominion over the house contents. It would count as delivery to her
house because shes already there.
HYPOS:
Fiddler on the Roof statue is given to Dolin at party at his Moms house.
He owns it because Mom intended to give to him; actual physical transfer; gift completed and he
gave it back to Mom to hold for him.
Painting mom says he can have it later.
He doesnt own it the intent is to only give it to him in the future; and no delivery.
Estates
Sometimes, possession is an abstract concept. Estates on land do not talk about the
land itself. Were talking about the ownership interest can be present possessory
interest or future possessory interest. We started talking about this in Gruen.
Younger Gruen had present ownership but future possessory interest.
Estate in property is the ownership and/or possessory interest in property. And these
interests can be diff and overlapping. As a result, there are different nomenclatures
governing these. These are extraordinarily important for the class, the bar exam,
and encounters w/ prop law in our careers. We need to make it very clear as to who
is getting what from whom.
All of our rules are geared towards the safety of free alienability. There are some
times when we want to promote other goals, like charitable purposes, but for the
most part, free alienability is the way to go.
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i. Fee Simple Absolute (Fee is from Fiefdom) (FS) (Biggest Estate The
Ultimate Estate)
1. unlimited ownership, the largest estate in terms of duration, it may
go on forever. The owner can sell, or pass on a fee simple to his
heirs.
2. Creation: Common: O to A and her heirs; Modern: O to A (in MD
by statute)
3. o Simplest and most complete ownership in property of land
4. o Can sell, divide, mortgage, lease, sublease
5. o Lasts forever
6. o No paramount lord above you
7. o no conditions doesnt terminate unless you choose to
terminate it
8. o even if you sell it, it doesnt create a new FS it merely sells
the same one.
9. FS estates last forever. That means that any estate that doesnt last
forever (aka is not FS absolute) will have a present interest and
future interest. The sum of both sides of that line need to add up to
the FS estate. Somebody must own the land in any given point in
time. (old Latin rule) I dont know what this means.
10. o Magic words FS is created by devising the property to:
a. A and his heirs
b. (now you can just say to A and its automatically FS)
c. While A is alive, the heirs have no interest in the land.
11. Inheritance of Fee Simple
a. No longer need to add the phrase and his heirs. The
words To A means a fee simple has been created.
ii. The Fee Tail (Abolished)
1. The estate will pass to lineal descendants generation after
generation until all descendants are dead. Then the estate will
revert to the grantor or the grantors heirs. They have largely
abolished in most states.
2. Every fee tail has a reversion or a remainder after it.
3. Magic words to A and the heirs of his body.
4. only partially alienable - You cant divest heirs of your body, and
when you die, the property goes to the next heir from the original
owner.
5. The current possessory interest you can sell your present
possessory interest but once you die, you dont own it no more.
6. Magic words to A and the heirs of his body. This estate is only
partially alienable. You cant divest heirs of your body, and when
you die, the property goes to the next heir from the original owner.
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27
d. Dissent said it was pretty clear that Jessie wished for the
house to be lived in, and not sold. Thats evidence of intent
to create a life estate. If we dug up Jessie, shed probably
agree, but the law is the law and the words are the words.
P. 168 Problems
1) O conveys Blackacre in 1600 to A for life, then to B forever. What interests? A has
life estate, than B also has life estate b/c its 1600 and you had to say and heirs back
then.
2) O conveys Greenacre to A and her heirs. As only child B is a spendthrift. Can Bs
creditors attach Bs interest in Greenacre? None - B has no interest in As land while A is
alive.
Suppose A decides to sell Greenacre to take a world trip and B doesnt like it. Can B stop
A from doing this? No B has no interest in Greenacre, no matter how mad he is at his
mom.
There is a way to give land to As heirs while alive. You can do that, except you have to wait to
find until A is dead to find out who those people are. Its an unknown group while A is alive.
Say you have land that goes from A for life to B for life to C for life at the end of Cs life, it
reverts to O.
P. 169 Problems
1) O has 2 children - A and B. B dies testate, devising all his property to W. B is survived
by three children, A has one kid. Then O dies intestate. Who owns Blackacre under
American law? A and to B1, B2, and B3. That is the direct line of descendancy. W got
nothing, because when B dies, he had no interest in Os property. Bs descendants get
whats left.
So it goes O spouse child childrens children, etc. If no spouse, straight to
children. If then no children, to collaterals parents, then brothers and sisters, etc.
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2) O conveys Blackacre to A and her heirs. If A dies intestate without issue, will
Blackacre escheat to the state? Only if he doesnt have collaterals brothers, sisters,
parents, spouse, etc.
Its like a pre-fixe menu with no substitutions allowed. Suppose you want to give land to your
granddaughter, but fuck her mom (your daughter-in-law) and her family. How do you make sure
it goes straight to your granddaughter? Create a life estate youd write to my granddaughter
for life, and then to the heirs on her fathers side. You just have to put the commas in the right
places.
Say O has land he owns in a fee tail. He sells to A, who can stay so long as O is alive. O dies,
and the property reverts to the next closest heir of the body of the original title holder. (Nobody
will lend on fee tails, b/c you cannot foreclose on the heirs of my body.) It makes it hard to sell,
improve, subdivide the land. We like land to be bought and sold, freely. We like alienability in
land so people can put it to better use. So fee tail = bad law (except for old timey states where
there are still some in play, like, sadly, MD.)
As life estate + remainder (reversion to O) = FS absolute. what?
Lets take a look at why language is so important in property law. White v. Brown decedent
(Jessie Lide) passed away and wrote a holographic (meaning by hand) giving her house to her
sister, and the rest to her niece.
P
Brown
D
v.
White
Want to sell property (Jessie left house to
them in FS so they can do what they need
to with the house.) They claim not being
able to sell the house is unfair
infringement of policy against
inalienability, conditions are unlawful b/c
its FS and so they should get to sell.
Issue:
What kind of estate did Jessie create by saying my house is not to be sold? A
life estate with a remainder or a FS subject to condition?
Rule:
Judgmen
t
for:
want it to stay the same b/c thats like the barn where I got my cherry
popped. Whatevs.
Point is that changes caused by A let B sue.
Next well talk about Defeasible Estates. (Well cover leaseholds another day.)
1. Restrictions on a fee simple allow for: the concentration of wealth,
discourages investment (no mortgages)
f. Disabling Restraint withholds from the grantee the power
of transferring his interest
g. Promissory Restraint provides that the grantee promises
not to transfer his interest (rare except in landlord-tenant
issues)
h. Forfeiture Restraint provides that if the grantees attempts
to transfer their interest, it is forfeited to another person
2. How to value a life estate figure out how the whole estate is
worth and figure out the how much is the estate worth per year.
Approximate annual rate of return calculated with the persons life
expectancy.
3. Doctrine of Waste: When two or more persons have rights to
possess a property at the same time. Affirmative Waste, Permissive
Waste and Ameliorative Waste.
4. In general: A life estate should always be avoided. Create a trust
instead.
i. No sale, no mortgage, no duty to insure and if the tenet
does insure the tenet gets all the insurance money. Leases
are limited to life of the person.
j. Life tenet cannot take minerals out of the land or cut
timber.
k. Permissive waste negligence failure to take reasonable
care of the property, which can result in the loss of the life
estate.
l. Because the remainderman has no remedy to the life
tenants hurting the value of the estate, so the
remainderman can get an injunction against the life tenet.
a. Leasehold Estates
x. The tenants only lease the land and do not own it. Lease holders do not
have siesin. (Leases covered later)
b. Defeasible Estates
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Defeasible Estate is an Estate that will terminate prior to its natural endpoint upon the occurrence
of some sort of specified event.
Example: What is the natural end point of a life estate? Grantee dies. Its natural end point is
death so its not terminating early.
Defeasible is something that can do either naturally at death or earlier.
xi.
These estates will terminate prior to its natural end point. Can be
conditional and a violation of which will result in forfeiture of ownership.
Purpose is to control land use or behavior.
xii. So why do this? The Grantor wants to have land use control over the
property (such as giving it away for free to a charity). You can also use it
to control Grantees behavior (such as giving it to Grantee only if they
dont consume alcohol on the premises)
xiii. Three types:
21.
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HYPO: To A for life, unless he raises horses, then to B for life. A has a life estate subject to
executory limitation. B has an executory interest in a life estate. O has reversion in Fee Simple
Absolute.
2. Cannot devise, sell or transfer right of re-entry, so B doesnt have anything. So Os heirs
have the right of re-entry in Fee Simple Absolute. They get nothing until they actually reentry.
3. A has Fee Simple Determinable; O has a possibility of reverter in Fee Simple Absolute.
4. B owns Blackacre in Fee Simple Absolute (if the construction started before O died). If
construction started after O died, then only Os heirs get Fee Simple Absolute.
5. Finger Lakes Land Trust has a Fee Simple subject to Executory Limitation; Land
Conservancy has executory interest in Fee Simple Absolute.
6. A has a Fee Simple Absolute (not a condition since there are no magic words here).
7. A can do whatever he wants, he has Fee Simple Absolute. Remedies available
injunctions, etc. Well discuss these later in semester.
8. In beginning, A has Fee Simple Subject to Executory Limitation; at time of conveyance,
B has that executory interest in Fee Simple Absolute (if A drinks alcohol, B would get it
in Fee Simple Absolute); now B contends to sell it; NOTE - Executory Interests are
transferrable NOTE so the opposite of Re-entry rights, etc. So after A starts drinking,
C owns the land in Fee Simple Absolute, as B sold his rights to C.
Future Interests
Future Interests Summary
1) A Deed can create not just present but future interest in property.
2) Future interests are not mere expectations but are actually legal ownership interests that may
or may not become possessory. Its more than a mere hope more than a mere expectation. ITs
a legal interest that you have today.
3) Future interests may be vested or contingent on some events. Maybe either in the transferor or
another transferee.
4) Choosing a future interest is like choosing a prefix menu only certain things go with certain
other things. For example, Executory Interests can only go with executory interest subject to
divestment. On the other hand, an alternative contingent remainder must go with another
alternative contingent remainder. There are no substitutions.
5) In determining all the interests present in the property, it may help drawing a line to infinity
and see how far each created interest goes and whether anything is left. Present possessory
interest and future interest together must add up to the original interest in the transferor.
Transferor transfers what he has he transfers less than what we had cant transfer more that
means he retains something whatever that may be. Ultimately it all adds up to FEE simple
absolute. No land is without an owner.
6) Each future interest created is an interest in some type of Estate. (i.e. once that interest
becomes possessory what type of estate will you get?). You must tell interest in what. In other
words, you have to ask, what type of estate will the holder of a future interest actually acquire
once he comes into possession. Give full names.
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7) In determining the actual estate created, the language in the deed is of paramount importance.
ITs all about language. You must read a deed clause by clause because often functionally
identical but grammatically different language will created radically different interests. We saw
this in problems 6 and 7. Seemingly identical, but placing commas in different places will
created very different interests. Thats important because the type of interest created will
potentially impact its alienability and other factors. Like examples 27 and 28.
I.
Future Interests
i. No sane person would have come up with this system originally; it
evolved over time that is why it is very complicated. But need to know
it for the bar exam.
ii. All the interest together must add up to FSA. Everything transferred must
add up to what the transferor transferred. The language in the deed is
important, must read it line by line b/c many different results can happen.
iii. Hierarchy of estates: fee simple absolute, (fee tail), life estate, lease hold.
b. Future Interests in the Transferor
1. Future interest gives present legal rights on future interests.
2. Not just an expectation that something will happen present day
legal rights even if it doesnt given present possessory interest
ii. Reversion is created when the holder of a vested estate transfers to
another a smaller estate. Whenever an owner carves out an estate lesser
than his own a reversion is created.
iii. Reversions are freely alienable you can sell them, lease them, place in
your Will, etc., because they are vested interests. Both intro vivos and
causa mortis.
iv. Reversion: An interest retained when the holder of a vested estate transfers
an estate of a lesser quantum.
v. Rules: All reversions are retained interests. They are all vested in the
transferor which means they dont have to satisfy any condition
precedent. He transferor doesnt have to do anything to take possession of
the property if they do get it back.
vi. anything less than Fee Simple Absolute- carve out estate less than your
own
vii. Always vested (can be subject to divestment) as soon as other estate is
up grantor gets land back
viii. Not certain to be possessory can be divested
NOTE THERE IS NEVER A POSSIBILITY OF REVERSION!
a. Example: If O, a fee simple owner, granted the land to A for life, the
land would revert (come back) to O at As death. Os right to future
possession is called a reversion. If O dies during As life, Os reversion
passes under his will or to his heirs, and at As death whoever owns the
reversion is entitled to possession of the land.
b. Example: O conveys Whiteacre to A for life, then to B and her heirs if B
survives A. O has a reversion in fee simple that is not certain to become
possessory. If B dies before A, O will be entitled to possession at As
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38
39
40
d. Executory interest in ..
i. Shifting take from grantee
ii. Springing take from grantor
iii. If vested -> next is executory interest
e. MUST SAY WHAT YOUR INTEREST ATTACHES TO
f. ***VESTED OR CONTINGENT (EI IS CONTINGENT),
WHAT IS IT, WHAT IS IT ATTACHED TO
g. CL could not sell contingent remainders and creditors
could not reach them, , and could not sue for waste
h. Now you can
i. If it goes to someone based on someone surviving A and A
dies and then child dies go to childs heirs because he did
survive A
j. All interest must add up to FSA*** or original interest in
transferor
k. Example: O to A until A owns a horse, then to B. A has a
fee simple subject to executory limitation and B has a
shifting executory interest in fee simple absolute.
l. Example: Mule HYPO (LOOK AT SLIDE)
i. Shifting and Springing Executory Interests
difference is who had the previous interest? Grantor
or another transferee.
ii. If the Grantor had the previous interest its called
Springing.
m. Example: To A when he is 21. If he reaches 21, it springs to
him and takes the land.
n. If the transferee had the previous interest its called
Shifting. It shifts the interest from A to B.
o. Example: To A, but if B becomes a lawyer, then to B.
p. Remember you cant give more than what you have.
Remember the Estate Hierarchy.
q. Not Executory Interest: TO A for life, once A dies, then to
B. Thats a natural end of As life estate not an executory
interest. There is no divestment.
r. Executory Interest: To A for life, but when A smokes, then
to B. If A starts smoking, then Bs executory interest divests
A.
s. Transferee = shifting executory interest
t. Transferor = springing executory interest
u. Under Common Law Executory Interests are different
from Contingent Remainders because of the way the law
followed. EIs are read differently for the purpose of RAP
from Contingent Remainders. If EIs violate RAP, different
rules follow.
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Example: O conveys to A and his heirs, but if A dies without issue surviving him, to B and her
heirs. A has a possessory fee simple subject to an executory limitation (or subject to divestment
by Bs executory interest). Bs future interest can become possessory only by divesting A.
Example: O conveys to A for life, then to B and her heirs, but if B dies under the age of 21, to
C and her heirs. B is age 15. B has a vested remainder in fee simple subject to an executory
limitation (or subject to divestment by Cs executory interest if B dies under age 21).
Example 7: O conveys to A for life, then to B and her heirs if B survives A, and if B does not
survive A then to C and his heirs. These are alternative/alternate contingent remainders in B and
C. If it vests in B, nothing vests in C it is destroyed. Vice versa if it vests in C.
1. O conveys to A for life and in the event of As death to B and her heirs. Is Bs remainder
vested or contingent? Answer: It is vested, B does not have to do anything to satisfy the
condition of As death. If B subsequently conveys her interest back to O, what does O have?
Answer: O would have a vested remainder. We only care about the name of remainders upon the
time of birth at the time of this Deed being executed, there was a life estate and a vested
remainder. B only has a vested remainder to give and thats what he can give to O.
2. O conveys to A for life, then to B for life, then to C and her heirs. What interests are
created? Suppose the remainder to C had been then to C and her heirs if C survives A and B.
What interests are created? Answer: A has a life estate, B has a vested remainder in life estate, C
has an indefeasibly vested remainder in fee simple absolute. Answer: A still has a life estate, B
still has an indefeasibly vested remainder in life estate, C has contingent remainder subject to
condition precedent and O has reversion.
3. O conveys to A and B for their joint lives, then to the survivor in fee simple. Is the
remainder vested or contingent? Answer: This is given to an unascertained person A has a
contingent remainder and B has a contingent remainder (Alternate contingent remainder) and O
has a reversion (technically) since A and B could die at the same time.
4. O conveys to A for life, then to As children who shall reach 21. As oldest child, B, is 17. Is
the remainder vested or contingent? B subsequently reaches 21. Is the remainder vested or
contingent? Answer: Bs part is contingent, and its vested subject to partial divestment if there
are other siblings coming along.
Problems Page 204
(1) O, owner of Wiseacre, comes to you to draft an instrument of gift. O tells you he wants to
convey Wiseacre to his son A for life, and upon As death O wants Wiseacre to go to As children
if any are alive or, if none are then alive, to Os daughter B.
O conveys to A for life then to As children and their heirs, but if at As death he is not survived
by any children, then to B and her heirs.
Answer: A has a life estate; As heirs have a contingent remainder in fee simple absolute. B has a
contingent remainder in fee simple absolute. These are alternate contingent remainders.
What if kids are both? Then As childrens remainder vests the gift doesnt say that the children
must survive.
Suppose that C dies in As lifetime, and that A is survive by B and D. What is the state of title?
D has a fee simple absolute along with the heirs of C; Bs interest is destroyed.
(1)(b) O conveys to A for life, then to such of As children as survive him, but if none of As
children survives him, to B and her heirs. At the time of the conveyance, A is alive and has two
children, C and D.
Answer: A has a life estate; As children have a contingent remainder; theres a reversion to O.
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a. The rule strikes any interest that does not vest within 21 years after the end of life
that exists at the time the property is granted. The offending clause will be
stricken from the deed. Rule strikes out any interest that does not necessarily vest
or fail with 100% certainty within 21 years of the life currently in existence. The
Rule considers all aspects, no matter how crazy (fertile octagregarian and unborn
widow).
b. Remember: Each interest created must be tested separately. Just because one
interest satisfies the rule doesnt mean all of the interests satisfies the rule. The
validating life can also be different for each interest.
c. REMEMBER: You measure the validity of the deed TODAY when the deed is
signed.
d. PICK A LIFE; GIVE THEM A KID; KILL THEM OFF & SEE WHAT WILL
HAPPEN IN 21 YEARS.
e. Policy to Prevent:
i. Furthering alienability of property
ii. Furthering productivity of property
iii. Preventing undue concentration of wealth
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the death of the survivor of A, B, and C. It matters not how unlikely it is that an 80-year-old
woman would conceive a child. Under the common law RAP, it must be assumed that a person
of any age can have a child, no matter what the persons physical condition. The presumption of
lifetime fertility is conclusive, notwithstanding contrary evidence. Even a child might conceive a
child under this viewpoint.
iv. Class Gifts
1. Class Gifts: The all or nothing rule. A class gift is not vested in
any member of the class until the interests of all members of the
class have bested. A gift that is vested subject to open is not vested
under the RAP. For a glass gift to be vested under RAP, the class
must be closed (that is, each and every member of the class must
be in existence and identified), and all conditions precedent for
each and every member of the class must be satisfied, within the
RAP period.
2. Gifts to groups of unascertained people like children or
grandchildren. They are contingent because they are subject to
open. Even a transfer that is vested but subject to open, then RAP
does not consider it vested. Since you could have a smaller share
than expected its a contingent remainder. This is an all or
nothing rule for class gifts
3. Rule of Convenience Equitable doctrine. Under this rule,
transfers to classes may be treated as closed (and therefor not
subject to open) if any member of the class can be vested (can take
now). This ROC cuts off the new entrance of the class/recipients of
transfer.
Example: A gift to A for life, then to As children, and A has living one child, B. Bs remainder
is vested subject to open, but it is not vested under the RAP until A dies and all of As children
are then in existence and identified. But because the remainder beneficiaries will all be
ascertained at As death, the remainder is valid.
i. RAP Danger Signs
i. The condition is not personal to someone
ii. There is an identified age or time period of more than 21 years
iii. An interest is given to the generation after the next generation (ie:
grandchildren)
iv. A conveyance requires that holder survive someone who is merely
described rather than names (e.g. the unborn widow)
v. An identified even that would normally happen well within 21 years, but
might not
vi. The holder wont be identified until the death of someone merely
described rather than named
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When you calculate the validating life you want to hypothetically use the oldest living person.
If you asked for 22 years it would be invalid.
We have to wait for almost all of the grandchildren die?
Example 22: T devises a sum in trust for A for life, then to As children for the life of the
survivor of them, then upon the death of the last surviving child of A, to As grandchildren. At
the time of Ts death, A is an 80-year-old woman with two living children, B and C. The
remainder to As grandchildren is void. Ts Estate also has a reversion.
Problems on 218:
1) O conveys to A for life, then to B if B attains the age of 30. B is now 2 years old.
Answer: Valid; B is his own validating life; O has a reversion in fee simple, determinable,
subject to executory interest.
2) O conveys to A for life, then to As children for their live, then to B if B is then alive, and if B
is not then alive, to Bs heirs. Assume that A has no children at the time of conveyance.
Answer: Valid as to A; valid as to B; valid as to Bs heirs, too. Interesting quirk Bs heirs may
not actually take possession and this doesnt matter we only care about their legal right.
3) O, a teacher of property law, declares that she holds in trust $1,000 for all members of my
present property class who are admitted to the bar. Is the gift good?
Answer: This is a class gift; this is a valid gift; lives are in existence we have our entire life
plus 21 years to satisfy the condition and well know for certain whether we will or will not
satisfy the condition.
3) continued: Suppose that O had said, for the first child of A who is admitted to the bar.
Answer: Not valid.
4) O conveys to A for life, then to As children who reach 25. (type the rest here)
Answer: Example 24 bypasses A; so they can take now; here, the kids cant take now they
have to wait until A dies. So its not valid; only thing is to A for life, period. You cant close the
class out because the kids cant take distribution today and here they cant.
5) O conveys to A for life, then to As widow, if any, for life, then to As issue then living. Is the
gift to As issue valid?
Problem is that the widow is not named. Everyone named in deed may be dead so 21 year
clock is ticking. Now we have to wait until As widow dies then can look at his children, then
living. We may have to wait 50 years until As widow dies after A. There is a hanging question
here and the RAP is designed to fight this.
This is a double trick. The widow may not be alive and you have to find out who is then living.
If the Deed had named a specific woman shes a life in existence we would know at the end
of her life which children survive her.
HYPO:
to A for life then to his widow for life
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6) a) T devised property to A for life, and on As death to As children for their lives, and upon
the death of A and As children, to B if A dies childless.
Answer: Is the last gift to B valid? Within 21 years of As death (at his death) we will know if he
died childless or with children we would know whether B takes the land or not. No hanging
question here.
b) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to B if A has no grandchildren then living.
Answer: A can still reproduce wed have to wait until their death and that will take longer
than 21 years so it violates the RAP. A would have to be the validating life here.
c) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Bs children.
Answer: Validating life can be B, doesnt have to be A. Well know exactly who takes after A
dies we can tell who the next generation will be after A dies, his children die it goes to Bs
children.
d) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Bs children then living.
Answer: A could have more kids, and they dont count as validating life; we dont know which
of Bs kids will survive As kids some may not be born yet and we wont know within 21
years of the last living person in existence. Not valid.
e) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to As grandchildren.
Answer: Invalid. Undefined class we wont know until potentially more than 21 years after the
last person has died. Its just too far-fetched.
f) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Ts grandchildren.
Answer: We know whose Ts kids are, since hes dead. Ts kids are validating lives within 21
years of Ts kids dying, we will know who all the grandchildren are. This is valid. The trick is
you have to focus on the fact that T is dead if it was intervivos gift, it wouldnt work.
Its when you have two open classes (Ts children and Bs grandchildren, for example) that the
ability to find a valid clause is hard its just more far-fetched?
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Answer: Xs vested remainder is transmissible at death because it is not subject to any condition
that X survive to the time of possession. So it passes to Xs successors in interest (Xs devisees
under will or heirs); those persons take exactly the same interest that X had. Y still has a shifting
executory interest in fee simple. There is no reversion.
6. O conveys to A for life, then to As children. A and O are alive at the time of the conveyance.
A has one child, X.
Answer: A has a life estate; X has a vested remainder in fee simple subject to divestment; and
there is a shifting executory interest in fee simple in As unborn children; there is no reversion.
7. Applying the same facts as Problem 6, assume that A has another child, Y, and then A dies
survived by X, Y and O. Identify all of the estates and future interests existing as of As death.
Answer: The birth of Y vests the remainder in them and simultaneously partially divests Xs
remainder (reducing Xs share from 100 percent to 50 percent). Both Xs and Ys remainders are
subject to partial divestment so long as A is still alive and capable of having more children. Once
A dies, however, the class of As children closes and Xs and Ys interest become indefeasibly
vested in fee simple absolute. With As life estate terminated, X and Y take possession and own
the property in fee simple absolute as tenants in common (each has an undivided interest).
8. O conveys to A for life, then to B and her heirs; but if B marries Z, then to C and his heirs.
Answer: A has a life estate; B has a remainder in fee simple that is vested subject to complete
divestment; C has a shifting executory interest in fee simple absolute; there is no reversion.
9. O conveys Blackacre to A for life, then to B and her heirs so long as Blackacre is organically
farmed.
Answer: A has a life estate; B has a vested remainder in fee simple determinable; O has a
possibility of reverter in fee simple absolute.
10. O conveys a sum of money to A if she graduates from college. A is not yet enrolled in
college.
A has a springing executory interest in fee simple absolute; O has a fee simple subject to
executory interest. If and when A graduates from college, As executory interest will vest in
possession, divesting Os fee simple.
Other Examples of Remainders:
Example: O conveys to Hartford School Board, but if the premises are not used for school
purposes during the next 20 years, to Town Library. The School Board has a fee simple subject
to an executory interest that will automatically divest the Boards fee simple if the condition
happens.
Example: O conveys to Hartford School Board so long as the premises are used for school
purposes, then to Town Library. The School Board has a determinable fee. Town Library has an
executory interest.
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Future Interests retained by the transferor (reversions, possibilities of reverter, and rights
of entry) are not subject to RAP. They are treated as vested as soon as they arise.
Example: O conveys Blackacre to the School Board so long as it is used for a school. The
School Board has a fee simple determinable; O has a possibility of reverter exempt from RAP.
Example: O conveys Blackacre to the School Board, but if it ceases to use Blackacre for school
purposes, O has a right to re-enter. The School Board has a fee simple subject to condition
subsequent; O has a right of entry exempt from RAP.
Future Interests in transferees:
Example: O conveys Blackacre to the School Board so long as it is used for a school, then to A
and her heirs. As executory interest violates the RAP. It will not necessarily vest within As
lifetime or within 21 years after As death. It may vest and become possessory centuries from
now. When an interest violates RAP, it is struck out and the remaining valid interests stand. Take
a pencil and line out the void gift, then to A and her heirs. This leaves a fee simple
determinable in the School Board. Since O has not given away Os entire interest, O has a
possibility of reverter.
Example: O conveys Blackacre to the School Board, but if it ceases to use Blackacre for school
purposes to A and her heirs. The School Board has a fee simple subject to (an apparent)
executory interest. As executory interest violates RAP as It will not necessarily vest within As
lifetime or within 21 years after As death. It may vest and become possessory centuries from
now. Strike it out, beginning with but if it ceases This leaves standing a conveyance To the
School Board. The School Board now has a fee simple absolute!!
53
Co-Ownership
Summary of Co-ownership:
1) Multiple people can own the same property together.
2) There are at least three ways of owning property together: a) tenancy in common; b) joint
tenancy; and c) tenancy by the entirety.
3) In each of those situations each co-owner owns an indivisible share of the whole. Each coowner gets the use of the entire property. They each own the entirety of the property.
4) Tenancy in Common is the default co-ownership interest. Unlike the other two, the shares in
TIC need not be identical. They can be TIC 60% and 40% for example. An interest of each coowner can be bought, sold, transferred, without notice, to another co-owner. You dont need
consent or permission or even tell them.
5) Joint Tenancy is just like TIC but has a right of survivorship and requires that each co-tenant
have an equal share in the property (So you cant have 60% and 40% - must be equal with each
other. Because of these extra features, has special rules to come into being the Four Unities:
Time; Title; Interest and Possession.
6) Right of Survivorship that comes with JT upon the death of any co-owner, the other coowners immediately take the deceased co-owners share. JT cannot be devised, because at the
time of death there is nothing to devise. Upon the last breath, whatever you used to own goes to
your co-owner.
7) Interest in Joint Tenancy can be sold without consent of the co-owners just like TIC you
just cant devise it. And if you do this such a transfer of ownership breaks the unities the new
guy comes onto the land by different title and different time and therefore makes the newcomer
not a JT but a Tenant in Common. Doing so also destroys Right of Survivorship since that
requires the unities.
8) Tenancy by the Entirety is simply a special kind of Joint Tenancy that is available to only
married couples. Just like JT same requirements except the additional unity of Marriage at
the time of the deed.
9) Unlike JT, TBE cannot be unilaterally be broken. However, has the other qualities of JT
a.
i.
b.
c.
1.
2.
55
3.
d.
iii.
Avoidance of probate
1.
iv.
1.
At common law both tenants had to own equal shares, if not they
were tenants in common. Today courts mostly ignore this rule.
56
2.
3.
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
xi.
57
v.
1.
The amount of the distributed is equal to the amount each put in, at
death the survivor gets all of the money. Different from joint
tenancy.
a.
b.
c.
d.
e.
f.
g.
58
HYPO: Two brothers inherit a fathers rocking chair. Selling it isnt an option its not worth
anything. Partition in kind isnt an option either. They made an agreement each had it for 6
months then it went to the other and back and forth, per the court ordered agreement.
HYPO: Expensive violin/painting same issue expensive to move back and forth court has
to come up with creative solutions.
vi. Sharing the Benefits and Burdens of Co-ownership
1.
a.
vii.
The courts will not make the owner of property pay rent on
something they already own. Except for ouster, like locking
the other tenant out or being denied access to the property.
b. In order to be denied, the tenant must first try to enter to
prove ouster. OR if one tenant transferred the entire interest
to a third party.
c. Court wants to promote the use of the land, one party is
using the land and other is sitting on his interest. If the
other tenant wants money out of the property, then he
should rent out the land himself.
d. Absent agreement to pay rent; or complete ouster of a cotenant; the tenant in common is not liable to pay rent for
their use of the property because they own the whole of
the property.
e. What is ouster? The essence of the finding of an ouster in
the adverse possession cases is a claim of absolute
ownership and a denial of the cotenancy relationship by the
occupying tenant. Ouster is showed by fact similar to
adverse possession.
f. Could they have won via adverse possession? Because the
Ps interest lapsed through Ds adverse possession? Why
not? The Rule is possession by one is possession by all.
Neither co-tenant has the ability to eject the other co-tenant.
I guess because they are on equal footing?
g. Imagine a locker shared space rather than a residence,
which seems more intuitively private.
2. What if the property is incapable of being shared between the two
tenants (too small)? Partisan in time OR Partisan by sale.
Swartzbaugh v. Sampson (1936) (p. 351)
1.
59
2.
viii.
ix.
x.
If you dont want to allow a joint tenant to lease part of the land
the other joint tenant could ask the court for partition, or demand a
share of the rent.
3. If the leasor died before the end of lease, then the joint tenant
would own the land in total. And the leasee will have to renegotiate the lease.
In joint and common all share the taxes and other cost according to the
percentage share
However, one tenant cannot seek sharing of costs for improvements but
that tenant gets more money when the property is sold or subdivided in
proportion to the improvement increased the value of the property.
Remedies available for a joint tenant
1.
2.
3.
Partition
Ouster
Accounting - suing to get a portion of the rents
Marital Interests
a.
1.
ii.
Only the husband could sell or transfer the land. A women ceased
to be a legal person for the duration of marriage, all property
become the husbands. Most states passed the Married Womans
Property Act removed the disability. Joint Tenancy can be broken
by conveying the property to another or yourself. This cannot be
done in Tenancy by the Entirety.
Sawada v. Endo (1977) (p. 361)
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c.
iii. Argument from D: Its not fraudulent since the house was unattachable
in the beginning. The house is owned by the unity of husband and wife
not attachable to husbands creditors.
iv. Four Categories: 1) H&W own property by the entirety but only H can
convey the property; H cannot convey the property but can be attached by
his creditor
v. This case falls under Class III An attempted conveyance by either spouse
is wholly void and the estate may not be subjected by the separate debts of
one spouse only. The reason is because spouses are joined as owners into
one estate one single spousal unit.
vi. Thus, the injured party here could not reach the property interest anyway
because the H has no separate interest in the property its not half to H
and half to W its an entire whole interest to both H&W.
vii. Creditors can check land records to confirm titling and should have both
spouses sign off on loans if they dont, thats their own fault, per the
court.
viii. Fundamental point unlike joint tenancy tenancy by entirety cannot be
destroyed by the unilateral action of just one party. The interest of neither
party is alienable without the consent of the other. There is one exception:
The IRS can DEATH, TAXES AND DIVORCE can destroy the tenancy
by the entirety.
ix. Policy Questions: Is tenancy by the entirety discriminatory? Is it generally
a good thing?
x. His view is that marriage may not be worthy of incentivizing. Could be a
good policy question
xi. Maybe T&E should be abolished for everyone some get a benefit that
maybe should be shared by more people? Broader or more narrow?
Maybe.
xii. If wife dies and husband remarries soon after, can the creditors take the
land? Yes, the creditors could take the land because the Tenancy by the
Entirety has been destroyed.
xiii. If you want to create a joint tenancy, need to say the magic words in
joint tenants, with rights of survivorship or tenants by the entireties etc.
xiv. Public Policy: The court looks at the family home as the greatest and
probably only asset, if the home is taken that hurts the family unit. The
policy gives creditors an opportunity to research the couple before they
lend the money. Creditors make both spouses sign the loan.
xv. Now all states have given equal rights to husband and wife in a tenancy by
the entirety. The rule does not apply to debts owed to the IRS or if the
property is used for illegal drug activity.
Termination of Marriage by Divorce
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i.
After the divorce the unity of marriage was served, becoming a tenancy in
common. With the no-fault divorce property is divided equally.
LEASEHOLDS
LOOK AT EXAMPLES FROM PAGE 275, 276 & 277
a. The Leasehold Estate
b. You have a continuing relationship with the landlord during a leasehold estate.
i. The Term of Years
1.
ii.
1.
62
Church sells after 30 day notice, court says that's proper under
"tenancy at will."
v. Tenancy at sufferance (Quasi-Tenancy) (Not really a Leasehold, separates
Tenants from Trespassers)
1. When a tenant over stays the lease. The landlord can choose to
allow the tenant to remain or evict. At common law remaining
allowed the landlord to holdover the tenant for another year, but
limit to one another year only. Subject to the same terms of the
original lease. The landlord has two options: eviction or consent
for creation of tenancy.
2. Some states have changed the law to allow for the landlord to
convert the lease to month to month or charge double rent. Or the
tenant will have to pay fair market value, which may lower the
rent. With transaction costs both parties might come out on top.
3. Fourth Type (Quasi-Tenancy): Tenancy at Sufferance (Type of
Situation that results when a Tenant remains in possession after
termination of the tenancy. The tenant is over-staying their
welcome and the landlord is allowing it. Theres no document for
this so not a real tenancy. Generally cant be a periodic lease
since it automatically renews.
4. At common law, stay over allowed the landlord to renew the lease
for a year.
5. Sometimes the length of the term can be hard to pinpoint. States
need to determine this for when someone overstays their length
and how the landlords are able to respond (automatically renew for
a month or a year?)
6. If the landlord does a holdover the rest of the clauses in your
lease are still the same same obligations on both sides its like a
renewal.
7. Some areas are different in Baltimore, landlord can charge
double rent for holdover.
8. Landlord is getting what they agreed to get anyway so its only
fair they dont have to advertise, etc.
Problems on Page 266:
1(a): One October 1, L leases Whiteacre to T for one year, beginning October 1. On the
following September 30, T moves out without giving L any notice. What are Ls rights? L has no
rights this was a periodic tenancy T is able to move out without notice since he was at the end
of the tenancy. If T had stayed one more day L couldve had holdover maybe.
What if the lease had been for no fixed term at an annual rental of 24k payable 2k per month on
the first of the month? This is a periodic tenancy.
64
2. T, a month-to-month tenant, notified L on November 16, 2010, that she would vacate as of
November 30, 2010. T subsequently vacated on that date and paid no further rent to L. L, after
reasonable efforts, finally relet the premises beginning April 1, 2011. The jurisdiction in question
has no statute prescribing the method of terminating a month-to-month tenancy. L sues T for
unpaid rent for the months of December 2010 and January through March 2011. What result?
Notice was given, but its not effective until November 30th and one more period so lessor owes
December rent, but not January through March. Once the tenants obligation ceases, the rest of
the problems are the landlords own problems.
The Lease
vi. A lease is both a contract and a conveyance. Statute of Frauds applies.
Most leases are contracts of adhesion; courts accept this but look for
evidence of unequal bargaining power.
vii. A lease is a document that creates a leasehold estate. A Billboard is not a
lease because the land is not modified but leasing land to put up a
billboard is a lease. Depends on possession and control by the landlord.
More control by tenant more likely it is lease. More control by the
landlord than a license has been created. Hotel room (license), apartment
(lease).
viii. Under traditional property rules convents are not mutual, could not break a
promise if the other side broke the promise first. Different from contract.
That is why a lease is both a contract and a conveyance.
ix. Terminology is important in the title of the document and the actual words
themselves.
x. Billboard is typically not a lease but are instead an easement or a license.
This is because the use of the billboard does not really interfere with the
grantors right of possession. On the other hand, you can actually rent a
small strip of land with two poles and since you are leasing a land this
can be a lease.
xi. A lot turns on the amount of possession and control retained by the
landlord. The more control given to the lessee the more likely it is to be a
lease rather than a license. IN a typical apartment, the tenant has more
control.
xii. The more services provided, the less likely its a lease. Hotels = license.
Fancier the hotel the more likely its a license since they provided more
services.
xiii. Fine line really nice apartments are still leases but seem to have
qualities of licenses.
xiv. Is a lease a conveyance or a contract? BOTH!
xv. Courts today commonly rely on contract principles to reshape the law of
leases with these questions: 1) Are the covenants in leases mutually
65
66
viii. This doesnt apply when you are renting your own home or are a small
landlord renting rooms in your own home then you can discriminate as
much as you want. Small landlords are exempt.
ix. Either Small or Large landlords are prohibited from advertising that they
are discriminating.
x. Is the prohibition on discriminatory language actually useful? Its still
legal to refuse someone in person you just cant advertise it is this a
good thing since its wastes peoples time?
xi. Notes: You cannot discriminate on the basis of children; but you can
discriminate on the basis of family size. Well talk about this with zoning,
too, if we get to zoning.
xii. What about discriminating on the basis of behavior? Too many whores? Is
this legit or based on family status? Hard to figure out gray area.
xiii. Page 275 newspaper publishers association list of taboo words for real
estate advertisements.
xiv. Ok to say: near bus lines, credit check required, no drugs or drinking, refer
to school districts, senior discount and presence of a nursery.
xv. Caution is advised: Fishermans retreat, no gays, no lesbians, handymans
dream, prestigious, nannys room, quality neighborhood, and secure.
xvi. Unacceptable terms: able-bodied, bachelor, near churches, couples only,
empty nesters, exclusive, executive, responsible, and no smokers. Cant
say no alcoholics either.
xvii. No smokers/no alcoholics looked at as a disability so its prohibited?
Maybe? Could argue.
xviii. Some of these words are code words so they can signify certain
meanings.
d. Tenants Right of Possession:
i. Hannan v. Dusch (1930) (p. 438)
1. English Rule: The landlord has the duty to deliver actual
possession. So if there is a holdover, the landlord can be sued by
the tenant. The English rule protects unsophisticated tenant which
most people are. Not fair to make the tenant pay for litigation
against another tenant. Half of the US courts follow this rule.
(English Rule) If you are a risk adverse landlord you wouldnt
rent out the unit until the prior tenant has vacated. This way you
dont worry about holdover tenants.
2. American Rule: the landlord only has duty to deliver legal
possession, not actual possession. The landlord had nothing to do
with the wrongful act and not should be held responsible for the
actions of another. Half of the courts follow this rule. (American
Rule) Other option you sue the holdover tenant hes trespassing
on property you have a legal right to possess.
67
69
27. Discussion. The court ruled that no matter what rule the court used
to analyze this case (modern or common law), the result was the
same. Because the sublease agreement left the lessee with no rights
either express or implied, the intention of the parties was an
assignment and not a sublease.
HYPO: If you lease an apartment and you give hot water and the other gives 1k and you stop
giving them hot water the obligation of 1k is not dependent on the covenant. You can sue for
the enforcement of the covenant but they are not mutually dependent.
HYPO: You sign a lease, you show up at leased premises and someone is there. What do you do?
Can you sue the landlord and the holdover tenant?
Problem #4: Page 274: Mrs. Murphy has an apartment to rent in her home. She puts the
following ad up: For rent: furnished basement apartment in private white home. Call bitch. An
African American couple applies and is rejected by Mrs. Murphy because of race. Are there any
violations here? a) Implication is obvious that its a white home and she wants to keep it that
way and she can reject their application but she cant advertise in a discriminatory fashion.
Problems on Page 284
4(a): 1. Can L go after T? Yes, landlord can always go after initial tenant they have privity of
contract.
Can L go after T1? No, its a sublease. They are not in privity of estate and they arent in privity
of contract.
Can L do anything to T1? Yes, he can evict him gets no money but can kick him out. Why? Its
an equitable remedy.
4(b): 1. L sues T for rent due. Yes, you can always go after the initial tenant always!
2. Can L sue T1? Yes, because its the same case.
4(c): 1. L, T, T1 (entire interest & assumption of covenants), T2 (entire interest) , T3 (entire
interest)
L can always sue T.
L cannot proceed against T2 no privity of estate and contract but T2 gave his entire interest
away.
Once you assign an interest, you are out of the picture the interest is gone and the person you
assigned it to now has stepped into your shoes
L can sue T3 based on privity of estate (as T3 holds the entire of what is left in the Estate)
Because T1 expressly assumed the covenants by doing so, he becomes in privity of contract
with L.
70
71
72
73
55. Minnesota has historically followed the common law rule that a
landlord may rightfully use self-help to retake leased premises
from a tenant provided that the (1) landlord is legally entitled to
possession and (2) landlords means of reentry are peaceable.
56. However there is a growing modern trend holding that self help is
never available. This view is founded on the premise that the
potential for violent breach of peace inheres in any situation where
a landlord attempts by his own means to dispossess a tenant.
57. Discussion. The court discussed first the historic approach
Minnesota had taken with respect to self-help evictions by
landlords. However, current trends demonstrate that any form of
self-help has the potential to catalyze a violent breach of the peace.
The court noted that state statute would allow a judicial proceeding
that could have the tenant evicted within three to ten days. The
court noted that this was a departure from the historic approach
taken, but justified to avoid any future potentially violent
encounters between landlords and tenants.
xix. Summary Proceedings
58. Every state allows for quick and efficient means for landlord to
recover possession after ending of tenancy. The cost is passed on to
the other tenants.
74
76
bv. The landlord need not accept less than fair market value
rent or substantially alter his obligations as established by
the pre-existing lease.
bw.Discussion. The court overruled precedent based on the
theory that when the landlord signed the lease with a
tenant, the landlord may not interfere with the estate
granted to the tenant by the lease. The court noted that a
lease for residential property could no longer be
distinguished from an ordinary contract and thus was
subject to the contract rule requiring mitigation of damages.
77
To recap nowadays, landlords are prohibited from leasing residential units that are not
habitable. Stuff like hot water, heat, running water, etc.
Used to be that you took premises as-is caveat lessee. But now, its implied that your place is
livable. That its implied is important b/c nobody has to write it in, and nobody can waive it.
Cant charge cheaper rent in exchange for making the tenant fix their own stuff. Is this a good
policy?
Maybe? In economic terms, it creates costs by pricing some people out of the market, but it also
protects the disadvantaged bargainer.
The corollary to this implied warranty of habitability is that landlords cannot evict you with self
help. If you require a landlord to go to court, the landlord will likely get less than he would have
otherwise. But otherwise you risk violence. Prof wants us to think about the drawbacks of
enhancing the rights of one side of the leasing coin over the other.
Final points implied warranty of habitability applies only to residential leases. Implied
covenant of quiet enjoyment applies to residential and comml leases.
What is habitable depends on totality of circumstances objective R person test. Failure to
adhere to municipal codes is not dispositive.
Although landlord has duty to maintain place, tenant has duty not to commit waste. Dont break
shit. Flush the crapper. Take out the trash. Etc. Tenant has a duty to notify landlord of anything
that goes wrong.
xx. Under common law, the landlord is not responsible for the breaches of the
other tenants. Today some courts say that the landlord has some control
over his other tenants.
a. The Illegal Lease
xxi. When the property is unsafe and unsanitary conditions the contract is
illegal and void. The code violations must have taken place before the
lease was signed not after.
b. Duty to Deliver Possession
i. Moving on to The Duty to Deliver Possession. Say L enters into a lease
agreement with T to start 4/1. But T shows up, and the old tenant is still
78
there. Drinking beer, no doubt. Who has the responsibility to get that old
guy out?
ii. In America, its your problem as the tenant. Landlord is only required to
deliver legal possession.
iii. But it depends on the state, and lots of US states follow the Old English
rule
iv. The English rule requires both legal and actual possession. A holdover
tenant is the landlords problem.
v. This is now the majority rule.
vi. New tenant can terminate and sue the landlord. (this rule is driven by the
least cost avoider the landlord prob has better chance of getting the old
guy out for the lease amount of money.)
c. The Implied Warranty of Habitability
d. Now to Implied Warranty of Habitability. Old rule was caveat lessee you lease
your shit as-is. Choose wisely. Over time, CL has shifted to give birth to this
implied warranty, which is only applicable to residential leases in all but 3 states.
xxii. Hilder v. St. Peter (1984) (p. 493)
60. A rental of any residential dwelling unit there is always an implied
warranty, which the landlord insures that the premises are safe,
clean, and fit for human habituation. Does not apply to issues
caused by the tenant.
61. A substantial violation of an applicable housing code shall
constitute prima facie evidence that there has been a breach of the
warranty of habitability.
62. Punitive damages are available in a tenant in appropriate cases,
must be a willful and wanton or fraudulent breach.
63. Hilder v. St. Peter P tenant sues landlord for damages sustained
as a result of the D being a slumlord. Broken window, no toilet,
smelled like sewage, no lock, leaking ceiling causing falling
plaster . . . pretty crappy place. P notified D, D promised but never
fixed anything. P paid to fix lots of stuff and paid rent every
month. Shes suing for punitive damages and all the rent she paid.
64. S. Ct. of Vt looked at the old rule, tossed it and said there should
be an implied warranty of habitability. Landlords are in a better
possession to fix the premises than the tenants. To succeed on this
claim, a tenant has to show:
65. Landlord had notice and failed w/ in a R time to repair it
66. Defect existed during the time the rent was withheld
67. This is totality of the circumstances of what violates this implied
covenant (and most states say this is not a waivable thing either
cannot K around this.) Violations of the housing code are prima
facie evidence of violating this covenant. Looks at basic health and
safety, and this is a pretty low bar. It has to be a pretty crappy place
79
80
80. To bring this claim, the tenant must show that he first notified the
landlord and gave the landlord a reasonable time to correct the
defect.
81. Discussion. The court went through the history of landlord tenant
law and noted that in todays modern society, the landlord is more
familiar with the complex operations associated with apartment
building maintenance and repair, while the tenant is at a
disadvantage in bargaining power. The court also noted that
punitive damages are appropriate in cases where the landlords
behavior is willful and wanton or fraudulent.
xxiii. Under Common Law the court did not care if the home was destroyed, the
tenant was still liable for the rent because the court viewed a lease as right
to the land not a home.
xxiv. Makes for sense for the landlord to be responsible to fix and upkeep the
property, today. Implied Warranty of Habitability cannot be contracted
around or waived. Does not apply if the tenant caused the problem, the
tenant is causing waste because the landlord has a reversion. Landlord can
charge the tenant for problems they cause or evict the tenant.
xxv. Tenant can withhold the rent until the damage is fixed. A very strong tool
at the tenants disposal, Landlord gets no rent and he cant release the
property. Court uses a reasonable person test, to decide the case. Landlord
cant retaliate against the tenant.
82. Tenant is only liable for reasonable rental value of the property in
violation of the warranty but the reasonable rental value depends
on the type of breach (it could be 0). Damages should also be
allowed for tenants discomfort and annoyance.
83. Tenant could withhold future rent
84. Deduct the expenses of fixing the problem himself only if the
landlord fails to act for a reasonable period of time after being
notified
xxvi. Not all jurisdictions have implied warranty of habitability. Did does not
apply to certain types of property: single family homes, agricultural.
e. Retaliatory Eviction
xxvii. Under common law a landlord had unlimited power to evict for any
reason, with proper notice. However this could lead to landlords evicted
tenants for excising their rights. Most states forbid retaliatory evictions for
this reason.
Probs p. 317
T has term of years, vacated early. L sues, T asserts constructive eviction based on
Ls breach of the covenant of quiet enjoyment. What result?
81
1) L fails to respond from nonsmoking tenant from neighbor smokes too much.
a. b/c landlord has a power to act, and doesnt, this could be a legit
constructive eviction. This is a big fat maybe.
2) Lots of criminal activity in the bldg.
a. Sounds like R steps by landlord to mitigate, and landlord had no control
over conduct by 3d party criminals in the neighborhood.
More probs P. 327
a) This violates the implied warranty of habitability. This is a serious risk of
health and safety.
b) Its no longer implied. Its their own warranty. The implied warranty is
concerned with serious risk of health and safety.
Note also that landlords cannot retaliate against tenants who assert their rights.
Landlord cannot refuse to renew the lease for good cause.
83
84
85
88
89
4. The Implied Warranty of Quality (kinda a new rule old rule was
caveat emptor) - Only applicable to buyers of recently constructed
homes. Same ethos as Implied Warranty of Habitability
(Landlord/Tenant). Implied Warranty of Quality means that the
builder of the home agrees that the home that he builds will be of
workmanlike quality (check this) (this topic he barely touched on)
5. Just because youre not delivering a super fancy home this
doesnt breached the Implied Warranty of Quality it only needs
to meet the Workmanlike standard.
6. Remedies for breach of this warranty: 1) you can get your builder
to fix it; 2) you may rescind it; 3)
7. Waiver is allowed, but it must be clear
a. Unlike IW of Habitability. A renter will be stuck with one
slum lord or another if IW of H was waived. A buyer of a
house may be in a better situation to pick and choose a
property, therefor not as worried about a buyer being taken
advantage of.
8. Similar to implied warranty of habitability in leases.
a. Liability of Builder was limited to the privity of contract
only to the party they had contracted with. This has mostly
been abolished since shell sales could be used for the
first sale and then they buyer would sell it to another
party, which did not have privity of contract with the
builder
Prob p 350
1) O conveys to A, O asks A for the deed back. O tears up the other deed. Who owns
it?
a. A. The deed was executed and delivered it was effective. There was
no memorandum supporting the return gift.
2) Suppose that O gives interest in the property to A as joint tenants. Then changes
her mind and says shed rather her grandson B to have the interest. They white out As
name and write in Bs name, then go record the deed. Then O dies. Who owns it?
a. A remains jt owner. Altering a deed doesnt change it. Theyd have to
write a new deed if they wanted to change things.
90
91
d.
e.
f.
g.
92
HYPO: Initial Price = 100,000. Deposit = 10k. Ultimate Price = 95k. If he keeps deposit too, he
gets 5k more. Court would say that the seller getting the extra 5k is unjust enrichment.
HYPO: Initial Price = 100,000. Deposit = 10k. Ultimate Price = 85k. In this situation, the
breaching party doesnt get anything back.
HYPO: You contract to buy Unit #7. The seller backs out but you can buy Unit #8. Should be
able to force the sale of Unit #7 because its not the same unit.
Answer: Yes property is unique. But this rule has been eroded to the type of building as a
condo.
HYPO: What if breach is the other way around. The seller contracts to deliver marketable title
and turns out that he cant. What are the buyers remedies?
English Rule: He can get the deposit back and any direct expenses but no damages absent bad
faith on the seller.
American Rule: Benefit of the bargain will get your deposit back, and any expenses, and any
damages.
Specific Performance: You tell the Seller, look I understand you cant deliver marketable title,
but I love this property, so Ill take it in any way you can transfer the title, but I want you to
reduce the price. So in exchange for waiving your claims for non-marketable title, you get a
reduced purchase price.
Almost no states have adopted UCC to deal with property disputes so it doesnt apply. Why?
Real Estate isnt mobile and Real Estate Lawyers apparently.
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1. Consideration. Its important to indicate some consideration, so that you can show there was a
presumption that land was purchased for value, rather than given as a gift or through inheritance.
2. Acknowledgement.
3. Description of Tract of Land.
d. The Deed
i. Warranties of Title
ii. Includes certain information such as: consideration, description of the
land, signature, grantor and grantees names
iii. Forged deeds are void and subsequent grantees, even bona fide purchasers
get nothing
iv. Fraudulent deeds are voidable by the grantor and if the grantee who got
this deed conveys to a bona fide purchaser, the bona fide purchaser will
prevail
1. Three types of deeds:
a. General warranty deed warrants title against all defects
in title, whether they arose before or after the grantor took
title. General Warranty Deed (the best Deed). This Deed
provides the greatest degree of protection, warranting title
against all
b. 6 Covenants:
i. PRESENT (in presente) Can only be broken at
the time of the transfer/Deed (once statute of
limitations runs, you cannot sue on these)
ii. 1. Seisin (The grantor actually has what he is giving
you)
iii. 2. Right to Convey (The transferor warranties that
he has the right to convey what he is conveying
usually hand-in-hand with Seisin but sometimes
they dont (could be a good exam question)
iv. 3. Encumbrances (warranty that there are no liens,
easements, mortgages, etc.)
v. FUTURE: (Statute of limitations doesnt run on
these covenants until they are actually broken
which may be never)
vi. 4. General Warranty (the transferor will indemnify,
protect and compensate the grantee for any loss as a
result of a lawful claim brought by someone else on
the land. He doesnt insure you from being sued,
though)
vii. 5. Quiet Enjoyment (grantor warranties that the
grantee will not be disturbed in his possession by
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2. Estoppel by Deed
a. If A sells land that he does not own, but later acquires title
to that land, he is stopped from asserting that title. The
newly acquired title automatically passes to the grantee.
b. Interesting MD Rule he learned today: The default deed is a
Special Warranty Deed wheras in VA, their default deed is a
General Warranty Deed. Logically, this means that land in
MD is cheaper but thats not true. Why is this? Because
of Title Insurance! With Title Insurance, you dont need to
worry about the warranties.
c. Equity regards as done which is ought to be done and
also, this makes sense in light of Covenant of Future
Assurance. If its simply necessary to sign another
document to give the land, youve already made that
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99
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e.
f.
g.
h.
HYPO:
O gave land to A by a Special Warranty Deed. It happened that during Os ownership, another
party B, acquired Os land through adverse possession.
Answer: O does breach his warranty after all, under adverse possession, Bs actions were on
notice to O. If the adverse possession matured during Os ownership and therefore the
encumberance arose under Os ownership.
HYPO:
You know there is an encumbrance on the property, but the Deed says that there are no
encumbrances. Can you then sue for breach of the warranty against Encumbrance?
You are a bad person if you do this but you can legally do it.
Warranty of Encumbrances is not about knowledge its about encumbrances.
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103
105
j.
k.
l.
m.
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108
109
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Elizabeth Taylor. Sandler has no actual notice of the Burtnett mortgage. In a jurisdiction where
indexing is a part of the record, does Sandler prevail over Burnett?
A: Sandler wins, but why? Theres no way he could get constructive notice. No search would
come up with the Burnett mortgage.
But, argument could be that Sandler shouldve done some additional inquiries knowing that
women change their names This would be a Wild Deed.
#2b. Suppose that Elizabeth had signed the mortgage Elizabeth Taylor-Fisher and that the
mortgage had been indexed under the name of Taylor-Fisher. Would this indexing give
constructive notice to Sandler?
A; Most courts, no, Taylor and Taylor-Fisher are very different names. Track Index helps with
this, too.
#2c. Taylors landlord had obtained a judgment against Betty Taylor d/b/a Betty Taylor Jewelry.
The name Better was used in the judgment because the lease was signed that way. The judgment
created a lien on all Taylors property and the judgment was filed and indexed under the name of
Betty Taylor. Title examine did not search under the name Betty Taylor. Does the landlord
prevail?
A: Title examiner must search under diminutives. (but probably not nicknames). This is all about
what it means to give proper notice. Black Letter Rule what would a reasonable person search
under? Probably not something thats not connected to the person who you are searching for.
Problem #1 on Page 434
1. O conveys Whiteacre to A, who does not record. O subsequently conveys to B, who purchases
in good faith and for a valuable consideration, but does not record. A then records and conveys to
C. C purchases in good faith and for a valuable consideration. B records. C records. Who
prevails under a notice statute?
A: C wins under a subsequent something rule in case.
A race-notice statute?
A: C wins when A recorded, they skipped B basically.
A race statute? (this wasnt in book he asked)
A: C wins.
Problem #2:
O, owner of Blackacre, which is worth 50k, borrows 10k from A and gives A a mortgage on
Blackacre. A does not record. O then borrows 14k from B and after telling B of the prior
mortgage to A, gives B a mortgage on Blackacre. B records. O then borrows another 5k from C
and gives C a mortgage on BLackacre. C has no notice of As mortgage. C records. Subsequently,
Blackacre is discovered to be contaminated with hazardous wastes and its value plummets. O
defaults. Upon foreclosure sale, Blackacre sells for 20k.
How is 5k distributed about A, B and C?
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B is owed 14k, so C would get nothing. B is second in line to A and he knows about the
mortgage. So B gets nothing, too. A gets 5k. Everyone behind A gets nothing. Go by expectation.
C and B both expect to be second so we start with A.
2)
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protected. People that have taken the land gratis without payment are not protected. Easy
come, easy go. If you havent spent your money into this you dont get the benefit of the
recording statute. Period. Other than that, some states may differ in that they could protect
creditors or not, etc.
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114
115
116
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b.
c.
d.
e.
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Ex. 7 p. 441
O conveys to A, who does not record. A conveys to B, who records the A-B deed. O conveys to
C, a purchaser for value who has no actual knowledge of the deeds from O to A and from A-B. C
records. Who prevails B or C?
The Q is whether the A-B deed properly recorded so as to give constructive notice to the
world? C would probably only search Os history for liens and conveyances. How could he know
about As conveyance? Does As recordation count, b/c it wouldnt give notice to C?
o If it were a tract jurisdiction, itd be easy, but if you were in a grantor/grantee jurisdiction, itd
be damn near impossible. You dont know A from Adam, so to speak.
Ex. 9 p. 446
A conveys to B by genl warranty deed. B records. A then later gets title to the land. A records
deed from O. A then conveys to C (who has no actual knowledge.) C records. Who wins B or
C?
You have a common denominator here A. A got from O. A gave to B. And A gave to C.
So it is discoverable that B was involved, so B wins. (old and busted)
o But Bs deed couldve been thought as a wild deed, b/c the title from O went to A then to C as
far as C is concerned. (new hotness)
Ex. 10 p. 447
O conveys to A, who does not record. O subsequently conveys to B, who knows of the
conveyance to A. B records. A records. Later, B conveys to C (GF, no notice of deed from O to
A. C records. Who wins A or C?
If it was between A and B, A would win. (B had notice.) But its not. And courts are split on
this.
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But btwn C and A, C was GF purchaser, and it would be easier for title searchers if you got
to stop at the dates of conveyance (and difficult to do otherwise.) C would search B and O, not
checking for A b/c that conveyance didnt happen while B held the property. It happened before
B got the property.
-
Probs p. 448-49
1)
2) Assume O owns land. Each conveyance is a warranty deed. Each person is a bona fide
purchaser except as otherwise indicated. Grantor-grantee index.
a.
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a.
Q is that deed recorded after mtg was recorded, does that make it not effective on the
subsequent title? No. of course not. C would find the mtg b/c it happened after the land conveyed
on 6/1/05.
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126
127
128
130
131
iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
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iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
xi.
xii.
xiii.
xiv.
xv.
xvi.
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d.
e.
f.
g.
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* The right to stop your neighbor from: 1) Blocking your windows; 2) Interfering with
air flowing into your land in a defined channel; 3) removing the support of your
building (usually by excavating or removing a supporting wall; and 4) interfering
with the flow of water in an artificial stream.
Difference between Easements/Covenants, etc.: Easements are often known as a real interest in
someones land. Literally someone else can do something on your land.
When you analyze these problems is the promise being made to the land or to the individual? Is
it ancillary to any land transaction?
e. Covenants
i. Covenants are promises made on your own land to the benefit of your
neighbors. The neighbors are likely to pay for the promises, because he
values those promises (not building a skyscraper so the neighbor can keep
his view, neighbor will pay $200,000). While easements are about rights
on anothers land.
ii. Covenant is a fancy legal word for a serious promise. A promise from an
owner of a parcel to do or not do something. These promises may be
beneficial to either one or both parties involved. Ex. A promises X not to
raise pigs on his own land. This arrangement involves both the promisor
and the promisee will want to enforce this agreement onto their
successors. If you are going to pay me to not raise pigs, you want to
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iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
xi.
xii.
ensure that me and my successors are bound by this promise. Both parties
want to inforce the agreement
How do you enforce this? Is to make the promise a property right a
property right can pass on from generation to generation or buyer/seller.
This is the fundamental nature of property. By passing on a fee simple
absolute, the buyer gets all of the burdens and the benefits of the property.
How do we convert a traditional contractual obligation into a property
right? Rely on privity of estate which we reviewed before. One way we
do this:
HYPO: Dolin owns a big piece of land; at some point he sells a corner to
Ricky. As part of the sale, Dolin promises not to raise pigs on his land
connecting. This promise was made not because Dolin was nice but as part
of a transaction to buy and sell this piece of land. There used to be privity
of estate and A buys the parcel from Dolin so we have privity.
History
1. Covenants are a way to enforce a negative easement through
contract, on the buyer and all successors.
Privity of estate enforceable contract between buyer and seller.
Burden end and a benefit end. If I promise not to raise pigs, I am
burdened by this promise. Dolin is benefited from my promise.
The burdens and benefits do not necessarily descend in the same way.
The test for the burden to run is more onerous than the test for the benefit
to run. Intuitively, this makes sense.
This test has to do with privity of estate; but as you can imagine, there are
two types of privity:
1) vertical privity; and 2) horizontal privity
1. Horizontal privity privity of estate between the original
covenanting parties; Horizontal privity is privity of estate between
the original contracting parties. This only exists when the covenant
is made in connection with a sale of estate. The inquiry is the
privity of estate, not the privity of contract.
2. Vertical privity privity of estate between one of the covenanting
parties and a successor in interest.
a. Burdens and benefits dont run the same way. Horizontal
and vertical privity is required for the burden to run. But
neither is needed for a benefit to run.
b. Ways to get around privity and burdens - Straw man can be
used, convey both lots to a third party, then the third party
conveys back to A and B with the restrictive covenants in
place.
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law. Equity requires that the parties intend the promise to run, that
a subsequent purchaser have actual or constructive notice of the
covenant, and that the covenant touch and concern the land.
Horizontal privity of estate is of no importance in equity. Nor is
vertical privity required for the burden to run. All subsequent
owners and possessors are bound by the servitude, just as they are
bound by an easement.
4. Equitable Servitudes are enforceable against successor who give
no consideration (donees, heirs, will beneficiaries, etc.), whether or
not they have notice.
5. Real Covenant vs. Equitable Servitude: Look at the remedy that
the plaintiff is seeking the remedy for breach of a real covenant is
damages in a suit at law the remedy for breach of an equitable
servitude is an injunction or enforcement of a lien in a suit in
equity.
6. Covenant: keep the space open and in good repair.
7. If the court adopted Defendants argument, then no one would
honor covenants people would sell the land to straw
buyers/dummy corporations to get around the covenant
requirements.
8. Equity is like Mom when Dad says no you run to Mom.
9. If an equity is attached to the property by the owner, no one
purchasing with notice of that equity can stand in a different
situation from the party from whom he purchased
10. Brief Fact Summary. The Plaintiff, Tulk (Plaintiff), had sold
Leicester Square by deed containing. The Defendant, Moxhay
(Defendant), a subsequent purchaser sought to build upon the land.
Plaintiff brought a bill for injunction.
11. Synopsis of Rule of Law. Since a covenant is a contract between
the vendor and the vendee, it may be enforced against a subsequent
purchaser who has notice of the contractual obligation of his
vendor, even though it does not run with the land.
12. Issue. Can a covenant restricting a property to a specific use be
enforced against a subsequent purchaser?
13. Held. Whether or not the covenant runs with the land, such an
agreement could properly be enforced in equity because the one
who purchases the land from Tulk had notice of that covenant.
Defendant, Moxhal could not stand in a different situation from the
owner from whom he purchased the property.
14. Discussion. An equitable servitude is enforceable by injunction
with no regard to privity, so long as the promise is intended to run
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Problem 3:
Same facts as #2, suppose that instead O leased her parcel to C for five years. A opens a nursery
school on her parcel. C brings an action against A for damages for breach of the covenant. What
result under traditional rules?
Answer: Under modified traditional rules, the lease doesnt shatter the privity. We have both
horizontal and vertical privity here so should work
So focus on who took what from whom look at the privity etc.
Zoning
1. Introduction
a. Zoning Power. Only the state has the power to zone. This power has been
delegated to cities and counties by statute called enabling statutes. Hence, all
local zoning activity must abide by the enabling statutes.
Law of nuisance was the ability for a private landowner to sue another private landowner to do
lawful activities but just in the wrong place (a gas station in a completely residential
neighborhood). Its not unlawful, just inappropriate.
b. Goals of Zoning. Zoning has as its goal the orderly development of the
community. It promotes economic growth, community health, welfare and safety.
c. How Zoning Works. One of the fundamental characteristics of zoning is that it
segregates uses of land into geographic regions. Thus, high rises may only be
permitted downtown rather than in rural areas. It can be used to foster commercial
districts as well as residential districts. For health and safety reasons, zoning can
regulate the density of human population. This can be achieved by limiting building
heights, providing for minimum and maximum yard sizes, yard setbacks, etc.
d. Constitutional Considerations. As with other areas of the law, zoning is affected
by the Constitution. For instance, if the zoning in an areas is going to be changed,
due process requires that the landowners in the area be given a hearing. Zoning
restrictions must be for a legitimate governmental objective. The Equal Protection
Clause requires that all landowners who are similarly situated be treated equally,
unless there is a legitimate reason for not doing so. Of course, as with eminent
domain, if zoning regulations amount to a taking, just compensation must be given
by the State.
1) Taking. The local government properly exercising its police power when it phases
out uses that are inconsistent with newly enacting zoning changes. For example, a
city can change the zoning where a cement plant is located and give the plant a
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couple of years to move before it will be cited for violation of the new zoning. A use
that, due to a zoning change, is no longer permitted is a nonconforming use. Most
courts say that that the landowner must be given a reasonable time to cease his
nonconforming use. The length of time for ceasing the nonconformity may be based
on the dollar value of the improvements of the land.
Leading Case Village of Euclid v. Ambler Realty Co
The ordinance under review and all similar ones must find justification under
the police power of the state asserted for the public welfare.
IF the validity of the legislative classification for zoning purposes is fairly
debatable, the legislative judgment must be allowed to control.
It is reasonable for a legislature to regulate the building to avoid nuisances
and promote safety, and if some harmless type of building is also excluded,
this will not invalidate an otherwise good law.
Complete restriction of all industry and apartment buildings from a purely
residential district is proper in that fire and health protection is thereby more
fairly suited to the task, traffic congestion and street accidents are reduced,
and a safer, cleaner and more enjoyable place for detached housing
development is provided. Apartment buildings and industry, taken as a
whole, would negate these benefits.
If the provisions of a law are applied to a specific property, they may be found
to be arbitrary and unreasonable. The Court will not examine each line of the
ordinance and enjoin the enforcement if no injury is shown other than a
general allegation that property values were affected.
In the development of Constitutional Law, the Court will not speculate with
general rules beyond the immediate question presented.
a) Introduction. Zoning ordinances present numerous opportunity for abuse and for
objection by affected landowners. Administration of zoning ordinances thus creates
the potential for considerable litigation.
b. Comprehensive Plans. Enable acts inevitable require the local zoning authority to
adopt a comprehensive plan (which can be revised from time to time). The zoning
must conform with the plan. The plan serves to limit the local zoning boards whims.
c. Nonconforming Use Lead Case PA Northwestern Distributors, Inc. v. Zoning
Hearing Board
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Generally speaking we presume the zoning regulations are valid. You cannot zone
someone out of existence you cant make sure that they close and you cant prevent them from
their natural growth.
Amortization clause.
Too much power to give the government.
1 exception if the govt can prove that the business was a nuisance they can pursue a
nuisance claim instead of a zoning issue. The govt can get rid of it that way. Everyone still is
subject to a nuisance law zoning didnt replace this.
Doesnt help the owner if he changes his type of business (adult books changed to
childrens book) because any business there is out of compliance
SCOTUS says you can zone but it has to be prospectively
Does this distinction of past and future use really matter?
HYPO: landowner buys land, hasnt build dirty book business yet, city finds out and petitions
to change zone before building is built and thats ok? Should it be? Be able to argue both sides.
PA Northwestern Distributors, Inc. v. Zoning Hearing Board
Brief Fact Summary. The Appellant, PA Northwestern Distributors (Appellant), opened an adult
bookstore. Twenty four days later, the Township adopted an Ordinance that imposed restrictions
on the location and operation of adult commercial enterprises. The ordinance contained a
provision requiring pre-exiting business to come into compliance within a 90 day grace period.
Synopsis of Rule of Law. An ordinance requiring termination of lawful pre-existing uses was
confiscatory per se and unconstitutional as the loss of use of property without just compensation.
Issue. Does a pre-existing use constitute a vested property interest that cannot be taken away
without just compensation?
Held. Requirement that pre-existing use cease within a specified period of time was per se an
unconstitutional taking of a vested property interest without just compensation.
Concurrence. Chief Justice Nix (J. Nix) did not think that any provision for amortization of
nonconforming use was per se confiscatory and unconstitutional. J. Nix would review
consideration of a more reasonable amortization (more adequate time to conform), but thought
the ordinance here at issue was not reasonable and therefore was confiscatory and
unconstitutional.
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Discussion. There is a slippery slope if any use declared to be nonconforming could be amortized
out of existence without just compensation. The Court points out that any property owner could
lose the use of his property, a vested property right, without just compensation.
* The lower Court based its dismissal on the opinion in Sullivan v. Zoning Board of
Adjustment, which is not a correct statement of the law in this Commonwealth.
Sullivan presents a standard whereby the property interests of an individual are
balanced with the health, safety, morals or general welfare of the community at
large.
* Zoning involves governmental restrictions upon a property owners
constitutionally guaranteed right to use her property, unfettered by government
restrictions, except where the use violates any law, creates a nuisance, or the owner
violates any covenant, restriction, or easement.
* A lawful nonconforming use establishes in the property owner a vested property
right that cannot be abrogated or destroyed, unless it is a nuisance, it is abandoned,
or it is extinguished by eminent domain.
* If the effect of a zoning law or regulation is to deprive a property owner of the
lawful use of her property, it amounts to a taking for which she must be justly
compensated.
Concurrence: A blanket rule against all amortization provisions should be rejected.
The instant provision is confiscatory but the Sullivan standard should be upheld.
d. Variances. Zoning by its nature is general; it does not take into account the
particularities of every lot in the zone. For that reason, boards of zoning
adjustments have been established locally. They are empowered to grant variances
for conditions that are unique to a particular lot or two. If the condition is not
unique, a change in zoning should be sought. Suppose, for example, that when a
tract of land was changed from a commercial zone to a residential zone, a 20-foot
side yard requirement was imposed. If there were a few lots that, due to their
shape, could not be used for housing if the 20-foot side yards were required, the
zoning adjustment board could grant a variance.
A Variance is a permission not to comply with an otherwise valid zoning regulation. For
some reason, you dont comply and you seek permission from the govt to obtain a variance. The
burden to show that the variance is warranted is on the petitioner.
What must you show? 1) complying with the zoning plan will cause undue hardship not
just difficult or expensive must be undue hardship. In order to do this you must show that you
have attempted to come into compliance with the zoning plan (like buying needed land from a
neighbor before going to the zoning board); 2) you must show that the hardship that you speak of
is not self-inflicted. (like getting rid of several plots, leaving you with one too small to meet
zoning regulations your actions/choices did this not the govt.); and 3) the variance that you
seek will not impinge upon the public good and the intent and purpose of the zoning plan. If your
variance would destroy the entire reason for the plan then it wouldnt work.
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Area Variance zoning plan where every house has to meet certain requirements
Use Variance all properties in this area must be commercial or residential, etc.
You can seek variance for either but generally speaking the burden of proof is higher
for those seeking use variance than those seeking area variance why? Remember, we must
show undue burden/undue hardship. ITs probably hard to show this if you cannot do THIS
action in THIS place. If you cant build a house but you could build a gas station its another
use so its not an undue burden it would be hard to prove an undue hardship based on the
fact that you cant do a certain action but you could do an alternative action instead
Variances must run with the land they are not personal to the individuals seeking them.
If Weingarten gets his variance and then sells the house it would be unusual for the new owner
to have to go through the whole damn thing again! Thus, the variance runs with the entire plot.
1) Special Exceptions. A special exception is not the same thing as a variance.
Where a particular use is compatible in theory with the surrounding zoning if certain
conditions are met, a special exception can be issued to the landowner. Criteria
must be established for granting special exceptions.
Exceptions: These arent really exceptions. Exception is using the land in a way that the
land permits but because of the type of use you want to do the city wants to be more hands
on. Commercial zoning and you want to open a junkyard. Since this type of business may be
dangerous the city may want to keep more of an eye on you so the govt is seeking an
exception to the rule for itself its like a special process for more dangerous/unique uses of
land. The govt wants to take a closer look at the situation
a) Example. A gas station may be compatible with a residential neighborhood if the
gasoline storage tanks are placed underground. The ordinance regarding special
exceptions would have to set forth the requirements for permitting a gas station in a
residential neighborhood.
SCOTUS 6 to 3 decision. Families can be of any size some can be 2 or 10. Simply saying only
5 unrelated but any number of related people can live there shows you are not doing this based
on size but rather on other characteristics.
Zoning can often be a cover for these exclusionary policies. For awhile, we had a very sordid
history of outright exclusionary like race or other characteristics. Luckily we dont have that
anymore.
Often, you can have the same result by excluding people you just dont like alcoholics or
people with low income through zoning. You can control how big the houses must be and limit
the low and middle class people from living within that zone.
Zoning for single-family used household allows you to exclude group homes, etc.
Facts of the Case: In Washington State, the City of Edmonds' zoning code provides that the
occupants of single-family dwelling units must compose a family, defined as "persons related by
genetics, adoption, or marriage, or a group of five or fewer [unrelated] persons." Under the code,
Oxford House, which operates a group home for 10-12 adults recovering from alcoholism and
drug addiction in a neighborhood zoned for single-family residences, was issued a citation.
Oxford House asserted that under the Fair Housing Act (FHA), which prohibits discrimination in
housing against persons with handicaps, the city had failed to make reasonable accommodations
permitting the maintenance of the group home in a single-family zone. Edmonds sought a
declaration that the FHA did not apply to the city's zoning code. The District Court held that the
city's zoning code rule defining family was exempt from the FHA under as a reasonable
restriction regarding the maximum number of occupants permitted to occupy a dwelling. The
Court of Appeals reversed.
Question: Does the City of Edmonds' zoning code provision covering areas zoned for singlefamily dwelling units -- which defines family as persons related by genetics, adoption, or
marriage, or a group of five or fewer unrelated persons -- qualify for exemption from the Fair
Housing Act?
Conclusion: No. In a 6-3 opinion delivered by Justice Ruth Bader Ginsburg, the Court held that
Edmonds' zoning code definition of the term "family" is not a maximum occupancy restriction
exempt from the FHA. Noting that it was designed to foster the family character of a
neighborhood, Justice Ginsburg reasoned that the provision was a family composition rule and
was not a maximum occupancy restriction exempt from FHA scrutiny because, while it capped
the number of unrelated persons allowed to occupy a single-family dwelling at five, it did not
cap the total number of people permitted to live in such a dwelling. Justice Clarence Thomas
wrote a dissenting opinion, which was joined by Justices Antonin Scalia and Anthony M.
Kennedy.
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Held. A municipality must by its land use regulation create an appropriate variety and choice of
housing. Actions under the police power are affirmatively required to promote general welfare.
Conversely, the zoning enactment is contrary to the general welfare and is invalid. A
municipality must zone for the welfare of the people and not for the benefit of the local tax
rate.
Discussion. There exists an affirmative duty not to foreclose classes of people seeking low to
moderate-income housing. The court found that the reason for the Defendants policy of land use
regulation was to keep down local taxes on property without regard for considerations related to
people, since New Jerseys tax structure imposes educational costs on local real estate. The court
felt that the regulations were designed to limit the number of school children and thus lower the
tax rate.
Remedy was in the hands of the municipality who should have the first full opportunity to
perform the function of enacting appropriate land use regulation that would provide for low and
moderate income housing of without judicial supervision. Further action could be taken if the
municipality failed to meet its affirmative duties.
Law of Nuisance
How is this different from zoning? One difference is that under nuisance, you can still operate a
business later, if you come into compliance maybe, whereas with zoning, if you arent in
compliance and/or cant be in compliance, you are out of luck.
Law of nuisance is the background law of property and part of the common law its always
been zoning came after we had built a bunch of stuff and is not a part of common law of
property.
You cant damage the property of your neighbors just because you want to dig a hole in your
property if you do a lawful thing in an improper place you can never use your property in
such a way as to damage others.
Its possible that something that was lawful 10 years ago is considered a nuisance now.
Zoning does not displace Nuisance remember this.
Libertarian Argument if the government wants to develop land differently, then they should
compensate these landowners properly.
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Eminent Domain
We give the govt this power because of people holding out for better deals/screwing up projects
need bridges/roads and the project needs to be complete for this to work. Private land uses are
different they can build around these hold out parcels but public land uses need to complete
the project.
Govt will only pay you market rate compensation which may be less than what you think the
market is worth. Your family home would be worth more to you than to the market, for example,
due to the value of the memories.
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Rationales:
Early civil scholars said sovereign states had original/absolute
ownership of property, prior to possession by citizens individual
ownership derived from state grants, subject to implied reservation
that state can resume ownership
Feudalism taking power is a remnant of feudal tenure
Natural law theorists said eminent domain is an inherent attribute
of sovereignty, necessary to govts existence (most common
rationale today)
What factors will a court look to when determining whether govt action is a taking, requiring just
compensation, as opposed to a mere regulation?
For a land use regulation to avoid being a taking, it must: (1) substantially advance legit state
interests and (2) not deny an owner economically viable use of his land. Here are some
specific factors courts look to in applying this general test:
1) Whether the government makes (or authorizes someone else to make) a permanent physical
occupation of the property. If so, this will automatically constitute a taking (regardless of how
little the burden on the owner or how large societys interest in having the occupation occur.
2) How great the reduction in value of the owners property. The greater the reduction, of course,
the more likely it is to be found to be a taking. But this is just one factor, and fairly large valuereductions have been held not to be takings.
3) Whether the owner has been denied all economically viable use of his land. If so, its
automatically a taking. Thus, a total ban on the building of structures on the land will certainly be
ta taking.
4) Whether the use prevented is harmful or noxious to others nearby (e.g. a steel mill in a
residential neighborhood). If so, a regulation, not a taking, is likely to be found.
5) Whether the statute can be fairly described as zoning. If so, its likely to be found to be a
regulation, not a taking. The same is true of landmark preservation statutes.
HYPO: Abe Lincoln owns a large apartment building. Old Abe has pretty firm ideas about what
ails society. One of his biggest peeves is television. He is therefore furious when the state enacts
a statute compelling owners of apartment buildings to allow cable television companies to install
cables in the apartments. Abe contends that he is entitled to compensation due to a government
taking is he correct?
Answer: Yes. The presence of the cables constitutes physical occupation and the government
doesnt have Abes consent to install the cables. Thus, hes entitled to compensation (Loretto
Case).
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HYPO: Johnny Appleseed has fruit trees in his yard that become infected with deadly Bungi
Branch Rot. The disease threatens to spread the commercial orchards nearby. If the State
demands that Appleseed destroy his trees, must it pay him just compensation for the value of the
lost trees?
Answer: No. The two main factors determining whether the govt action is a taking as opposed
to a regulation are (1) whether the action is an appropriate or permanent invasion; and (2)
whether it has a severe economic impact. Weighing heavily in this calculation is the degree to
which society benefits from the action. Here, the existence of a disease threatening an important
crop weighs strongly against considering the government action is a taking. Instead, the state
action is taken under the police power to protect industry, and as such, it will be considered a
regulation.
HYPO: Ty Koone owns Lighning Acres, which was at one time Ben Franklins Summer Home.
He operates the property as a profitable resort. He plans to tear down the original building and
put up a high-rise building in its place; however, the state steps in and designates the property as
a historic landmark, putting the kibosh on Tys plans. Will Ty be entitled to compensation due to
a government taking?
Answer: No. Designation as a landmark is considered regulation as long as the property owner
can still get a reasonable return on his investment (Penn Central). Here, Ty can get a return on
his investment and in the face of public policy of preserving landmarks, the court will deny Ty
any compensation.
Takings Analysis:
1. Has your land been taken from you? Either by physical occupation or by regulation.
2. To the extent that your land was under a taking was it for public or private use? If public use
what is the public purpose? Private uses can also be for the common good/carriers (railroad)
3. Once the petitioner has satisfied showing theres a taking and the govt has satisfied that its for
public use then the question of just compensation comes up.
Takings Clause Analysis:
1. Is there a taking?
2. is the Taking for public use?
3. Was there just compensation paid?
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Government will sometimes say you can keep your land but you just cant do A, B or C on it. Or,
you can keep your land but we need to also do something on your land. This can diminish the
value of your property. So when does the actual taking occur which triggers the just
compensation requirement?
Two types of takings separated in two types (both very different): 1) physical taking
government comes in and says we are going to take your property/physical come into your
land/occupy by force you must surrender part of your land physically to the government; and
2) regulatory taking. This is when the govt promulgates regulations (protect the environment,
etc.) that diminishes the value of your land. No govt agent comes onto your land physically but
they tell you what to do (cant do or must do).
Physical takings are subject to a simply categorical rule: If the govt physically takes your land;
its a compensable taking. Once the govt does this, they owe the owner just compensation.
Sometimes there is a debate as to what it means to physically take the land.
Landowners = they want it to be a physical taking because then the govt needs to give them
just compensation or they have to stop if not for public use.
Govt = they want it to be a regulatory taking, since they usually win here.
Takings Tests (Ps want to fit all 3 tests b/c want 3 bites at the apple to prove a taking)
USSC recognizes all 3 takings tests b/c they aim to identify regulatory actions which are
functionally equivalent to eminent domain (Lingel)
o (1) Default Ad Hoc Balancing Test 3-part balancing test
Considers effects on present + future economic value caused by reg; no
instruction to courts re how to do balancing ad hoc means courts use
the test when/how they want
(i) Economic interference with existing use of the property
(present value)
o Does it impair owners current use of the property?
(ii) Reasonable investment-backed expectations (RIBE) hurt
(future value of property)
o RIBE: USSC-created phrase + undefined either side +
court can interpret differently
o Courts interpret RIBE effect differently:
Some say reg must destroy all economically-viable
use of land
Some say regs must interfere w/ already-made
investments
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o
o
o
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Per se:
Govt intent + how much space PPO occupies irrelevant
No balancing of govt interests or economic impact created by the
regulation
A permanent physical occupation authorized by the government is
a taking, period.
Problems with a per se rule: (Loretto dissent)
o Excludes consideration of other circumstances which may
justify PPO
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2 Exceptions
Common Law Nuisance: If use owner proposes is common law
nuisance no taking
Preexisting Limitation on Property Rights: If use property
owner proposes is something they didnt have the right to do
before the reg no taking
o Examples:
Infringe on a recognized easement
Trust doctrine some states: public rights to use
beach mean beachfront property owners cant
exclude public
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beaches within the state. In 2003, under the BSPA, the Florida Department
of Environmental Protection filed for an Application for a Joint Coastal
Permit and Authorization to Use Sovereign Submerged Lands in order to
dredge sand from a shoal to rebuild a beach. Stop the Beach
Renourishment Inc. ("SBR"), an association of homeowners, subsequently
challenged the issuance of the permit and the constitutionality of the
BSPA. The Florida court of appeals rescinded the permit, holding that
issuance would have resulted in an unconstitutional taking.
On appeal, the Supreme Court of Florida first rephrased the certified
question to determine whether the BSPA was "on its face" constitutional.
Then, the court held that the BSPA was not unconstitutional, reasoning
that it did not deprive land owners of littoral rights without just
compensation.
Question: By reversing longstanding holdings that littoral (i.e., on or near
the shore) rights are constitutionally protected, did the Florida Supreme
Court cause a "judicial taking" proscribed by the Fifth and Fourteenth
Amendments?
Conclusion: No. The Supreme Court held 8-0 that the Florida Supreme
Court did not take property without just compensation in violation of the
Fifth and Fourteenth Amendments. Justice Antonin Scalia announced the
judgment of the Court, and authored an opinion in which he maintained
that there could be no taking unless property owners could show that they
had rights to future exposed land and to contact with the water superior to
Florida's right to fill in its submerged land. Here, there could be no
showing. Scalia drew from Florida-law principles that (1) the state, as
owner of submerged land adjacent to beachfront property, has the right to
fill that land and (2) the exposure of land previously submerged belongs to
the state even if it interrupts the beachfront property owners' contact with
the water. Justice Scalia, with a plurality of the Court including Chief
Justice John G. Roberts and Justices Clarence Thomas and Samuel A.
Alito, also noted in Parts II and III of the decision that if a court declares
that what was once an established right of private property no longer
exists, it has taken that property in violation of the Takings Clause.
Justice Anthony M. Kennedy, joined by Justice Sonia Sotomayor,
concurred in part and concurred in the judgment. He agreed with the
Court's holding, but disagreed that a plurality should reach the issue of
whether or when a judicial decision determining property owners' rights
can violate the Takings Clause. Justice Stephen G. Breyer, joined by
Justice Ruth Bader Ginsburg, also concurred in part and concurred in the
judgment. He agreed with the Court's holding, but, like Justice Kennedy,
counseled that the Court should only address the issues before it.
HYPO: Must the govt avoid taking your property to avoid a taking? NO courts allow the govt
vast control over this and trust their judgment. So because the govt could build a bridge next to
your land for more money rather than taking your land to build the bridge the govt is not
required to seek alternative ways not like strict scrutiny..
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