prop outline carlos

8/7/2019 Prop Outline Carlos

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The Concept of Property:

I. The Occupation Theory: First in time possession gives ownership rights to a party who (1)engages in the physical act of possessing property, (2) has the intent to control the object and (3)

toexclude others.

a. Pierson v. Post:P was chasing a fox;D intersected and killed the fox. P brought a suit forconversion(seeking damages or return of property).

i. Held: Hot pursuit not sufficient, ownership only for hunter who kills and possesses thefox. Evidentiary problem to determine when pursuit begins.

a. (Property is acquired by possession).ii. Dissent:Pursuit with dogs should be sufficient; it better promotes the extermination of

foxes.

b. Ghen v. Rich:P shot and killed whale, leaving mark of hunter in the whale. Whale sank and wasdiscovered 17 miles away by D, who sold its meat and oil. It was custom to return hunted whale

if there was a mark of hunter in the whale.

i. Held: Custom should be followed, and whale or damages should be returned to hunter,b/c hunter left mark in whale.

a. (Property is defined by custom).c. Keeble v. Hickeringhill: P owned a pond and used decoys to catch birds in such pond. D was a

competitor-hunter who discharged a rifle to scare birds away from Ps pond.

i. Held:P can recover damages b/c Ds actions are unfair competition that can scare thebirds from all neighboring farms. Thus, such practices should be discouraged.

a. (Property is defined by policy - Unfair competition is negative).d. Johnson v.MIntosh: D owned title of land acquired from the US government. P purchased

same land from the Indians and brought ejectment action.

i. Held: The Indians are merely occupants, and have no ownership rights. Thus they cannotconvey land.

a. (Property is socially contingent).II. The Labor Theory: Because one owns ones own labor, when one works in a certain property,

one mixes ones labor with the property, and thus, one becomes the owner of such property.

i. Modern Approach:Protecting ownership rights is important to incentivize that laborthatenhances property. (Justifies taking the land from the Indians; because they failed to

perform sufficient labor to the land to own it).

b. INS v Associated Press: D obtained the news gathered by P and delivered such news to Dssubsidiaries before P. P sued to obtain an injunction preventing D from doing so.

i. Held: News is public property once disseminated, but they remain as quasi propertybetween news agencies. One agency cannot benefit from the labor and effort invested by

another agency to disseminate news for profit.

c. Cheney Brothers v. Doris Silk Corp: P designed silk garments which could not be patented norcopyrighted. D copied and sold the designs, P sued to recover profits.

i. Held: If inventions cannot be copyrighted, it means the legislative has determined thatallowing copies is more socially beneficial than protecting the invention. Thus,


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inventions that cannot be copyrighted can be copied without penalty.

d. Moore v Regents of the University of California:P was diagnosed with leukemia; thus hisspleen was removed. However, Ps spleen and his genetic material were taken from P without his

consent during medical tests, and D developed a very profitable cell line.

i. Held: CA law limits the rights of patients ownership of disposable material andextracted cells. Also, it is in accordance with public policy to protect scientists who

advance medical science through cell research. Thus, Ps claim is invalid.

III. Utilitarian Theory: Property rights are protected because doing so maximizes wealth for society.One protects the rights of others to create an expectation that ones rights will be protected.

Demzets: Favors defining property rights in a manner that reduces transaction costs.

y The long chain of causation: (1) Changes in technology or the opening of new markets create (2)changes in economic values which increase (3) internalization and (3) lead to property rights. Changesmay not be conscious but come about through social mores or common law precedents. Property rights:

an instrument that helps us form expectations about our dealings with othersy Property rights are socially constructed--they are expectations of how we can deal with others, expressed

as laws, customs, or normsy The "main allocative function of property rights is the internalization of beneficial and harmful

effects" (externalities). Correct allocation of property rights reduces TRANSACTION COSTS!!y Thus, property rights emerge b/c of the "emergence of new or different beneficial and harmful effects."

They emerge to "internalize externalities when the gains of internalization become larger than the cost ofinternalization."

o E.g.: Indians in Quebec established property rights after the (beaver) fur trade picked up--thus,they internalized the externality (over hunting), saving the beavers

o But SW Indians hunted grazing animals with little commercial value (low benefit ofinternalization) and the animals wandered a lot (high cost of internalization--hard to keep trackof which animals are "yours") no property rights

Three ideal types of ownership:

y Communal (all members of community can exercise this right; neither citizen nor state can interfere).Must negotiate over costs of externalities--how much each tribe member will hunt beaver, e.g.

y Private (owner can exclude others)--greatly reduces negotiation costsy State (state can exclude anyone from using the property)

o The Tragedy of the anti-commons: Over-depletion of natural resources that results from a freemarked without restrictions (Over-exploitation of oil in Texas).

a. Kaiser Aetna v United States: Powned a pond, and invested substantial funds and effort increating an exit to connect and make such pond navigable with the adjacent ocean. US made thepond publicly navigable and paid no compensation to P.

i. Held: US cannot make pond navigable without paying just compensation under 5thAmendment. P spent effort and funds, thus US most compensate. Governmentintervention should be determined by 1) economic impact, 2) Interference withreasonable investment expectations, and 3) character of interference.


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IV. Personality Theory (Hegelian):Property becomes a part or an extension of ones personality, andthus, ownership rights should be respected by society.

a. Perry v Sinderman: Untenured college professor worked on yearly contract was fired bycollege due to criticizing the board. College argued he could be removed at any time because hewas not tenured, and thus had no ownership rights upon his position.

i. Held: Although P was not tenured, faculty handbook established that professors couldwork indefinitely. Since ones work is an important aspect of ones identity, P is entitledto a hearing to determine whether his firing was reasonable.

b. Bishop v Wood:P, a policeman, was fired due to alleged misconduct, which he refuted withevidence. D, N. Carolina Police, argued that P could be fired at will of the city because P was nota permanent employee and thus had no ownership rights.

i. Held: SCOTUS held that although P may have ownership rights, Federal Courts are notthe right place for employees to dispute wrongful terminations.

V. Property Rights v Civil Rights:Per the communist manifesto, property rights enslave the people.a. Marsh v Alabama: A town was completely owned by a corporation, but it looked like a public

town. Yehova witnesses were passing propaganda, but the Corporation compelled them to desist

under counts of trespass.

i. Held: The town has characteristics of a public thoroughfare, thus free speech is protectedby the 1st Amendment. FREE SPEECH WINS

b. Logan Valley Plaza: Civil Rights Win Ds protested to a store, located in a mall, to compelsuch store to hire union employees and provide union salaries and benefits. The store was located

in Ps mall, and the protest took place within the mall.

i. Held: Mall is analogous to the private town inMarsh, b/c although private, it is publiclytransited. Thus free speech is protected. SPEECH WINS.

c. Lloyd Corp v Tanner: Ps passed invitations for meetings opposing to Vietnam. D (mall) toldthem they had to leave the malls premises and pass the invitations outside.

i. Held:Property does not lose private character b/c public is invited to use it for designatedpurposes. Therefore, D cannot be forced to respect Ps 1

st Amendwhen P can be

considered a trespasser on Ds property.PROPERTY WINS.d. Hudgens v NLRP: Ps were chain store employers who went in strike against the store

protesting in several area locations, including Ds mall.i. Held:A private shopping mall is not the functional equivalent of a town and, therefore,

not a state actor subject to the requirements of the First Amendment of the United StatesConstitution.PROPERTY WINS.

e. State v Shack: Ps social worker and lawyer, sought to enter the housing provided by D,landowner to migrant worker. D refused entrance to Ps, and denoted that the meeting could onlytake place in the landowners office and in his presence.

i. Held:Ps have right to entrance to Ds property, b/c they want to serve an underservedindividual. Property rights will be largely upheld, but will be restricted if such rights

infringe or limit civil rights of others. RIGHTS WIN.

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The Protection of Possession:

VI. ADVERSE POSSESSION: The possessor must (1) actually enter and take exclusive possession,(2) that is open and notorious, (3) that is adverse and hostile to a claim of right, and (4) continuousfor the limitation period.


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a. Hostile Element Three Different Views:i. The state of mind (intent) of the adverse possessor is irrelevant: All that matters is

that the original owner slept on his rights. CAMERON.ii. Good Faith Standard: Courts tend to reward those who adversely possess property with

the good faith belief that the property is not owned by anyone else.iii. Aggressive Possession: The view that courts will reward adverse possessors who

aggressively possess property b/c that incentivizes original owners to be vigilant of theirproperty rights.

b. Rationales for Adverse Possession:i. Sleeping Theory: Slothful owners should be punished for two reasons:

a. By leaving their property unutilized they fail to maximize the wealth generatingpotential of such property.

b. Claims of possession are hard to determine after lengthy periods, witnesses dieand disappear, documents are lost, and memories fade.

ii. Earning Theory:a. Those who take over property and generate wealth for society should be

rewarded, and those who abandon their property should be punished.iii. Stability Theory:

a. Adverse possession enables disputes to be resolve expeditiously by delivering titleto the person who has occupied the land.

c. Definitions:i. Privity of Estate: Voluntary transfer from the first possessor to the second possessor of

either and estate in the land oractual possession.ii. Color of Title: Obtaining possession from a previous adverse possessor through a written

document, usually a defective deed (for wrong land or forged). New adverse possessormust take possession of substantial portion of land under color of title.

iii. Replevin: Action to recover personal property wrongfully taken.iv. Encumbrance: An encumbrance, as it pertains to real estate, means anything thatburdens title to the property. An encumbrance can be a mortgage (loan), a lien(voluntary or unvoluntary) an easement or a restriction that limits the title. Anencumbrance can involve money, but not always. The saying is all liens areencumbrances, but not all encumbrances are liens.

d. Cases:i. Van Valkenburg v. Lutz: P occupied land which D subsequently bought. P kept a small

garden, used Ds land to enter his, built a small shed, and used the land to display junk.a. Held: Occupation is too insubstantial to satisfy the open and notorious element of

adverse possession. Improvements were insubstantial labor applied toproperty.

ii. Manillo v Gorski: P built a set of stairs which encroached on Ds property by 15 inches.D sued for such stairs to be removed, and P sued for claim of title per adverse possession.

a. Held: Encroachments in a small area are not clear and self-evident until theowner has actual knowledge. Here, there was no actual knowledge, intent isirrelevant.

iii. Howard v Hunto: P took possession Dssummer house, under color of title (defectivedeed) thinking that Ps deed described Ds summer house when in fact it describedadjacent property. P occupied summer house during the summer only.


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a. Held: Continuous possession does not require uninterrupted, simply periodic orcontinuous possession over time. Occupying summer house during summersatisfies continues possession element b/c it was continuous over time.

iv. Okeeffe v Snyder:P authored a painting which was exhibited in a museum, andsubsequently stolen. D bought painting many years later. P failed to report the paintingstolen within a reasonable time.

a. Held: The discovery rule applies. Original owners who lose chattels have a duediligence duty to seek recovery of the lost property within a reasonable time. Here

P failed to make attempts to recover the painting with such reasonable time.

e. Correlatives in Property Law:i. Rights/No Rights Privilege/Duty Power/Disability Immunity/liability

Jural/Correlatives Right/duty Privilege/No-right Power/liability Immunity/disability.

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VII. BASIC REMDIES:i. Injunction: When the rights of ownership are interfered, Plaintiffs can seek an injunction

to remove an encroachment or illegitimate possessor.ii. Monetary Damages: When an injunction creates a burden unreasonably higher to the

defendant when compared to the injury sustained by the Plaintiff, monetary damages areappropriate.

iii. CAMERON (DEMZETS): Courts should stay away when possible, b/c parties canbargain among themselves and determine a solution that maximizes wealth for society.

a. Whether an injunction or damages are granted depends on whether thelosing party would have lesser costs than the winning party if the winning

party would lose.

b. Cases (Basic Remedies):i. Geragosian v Union Realty: D built a theater with some fire exits and structures which

encroached in Ps property, although not substantially. P requests an injunction to compelD to remove the encroaching property from Ps property.

a. Held: Injunction should be granted b/c monetary damages do not alwaysrepresent equivalent compensation for the injury suffered when property rights areinfringed.

ii. Peters v Archambault:Ps bought property knowing that Ds adjacent propertysubstantially encroached on Ps property. Ps later sought an injunction to compel D toremove its substantial encroachment overPs property.

a. Held: Injunction is appropriate for trespass taking up significant portion ofPsland regardless of costs to remove trespass.

1. Dissent: D would suffer significant costs and burden if required to removetrespass. Such costs and burden are significantly greater than the injurysuffered by P.

b. Risk of Unfair Negotiation:Now that there is an injunctive order, there is likelyto be an unfair negotiation, in which P will try to get as much from D in an

extortion like transaction.

c. Cameron: Society should only be concerned with encouraging and ensuring thatthe negotiation between the parties ultimately maximizes the overall wealth of


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society.

iii. AD COELUM RULE: Property owner owns everything below and everything above thesurface of owners property.

a. Edward v Sims:P owns land next to Lee, and has established a cave thatsupposedly encroached underneath Lee property. D (Judge) ordered the caveentered to determine if in fact it encroached upon Lees property.

1. Held: Yes, the court has the authority to issue a writ of survey. Under theAd Coelum rule, owner of adjacent property is entitled to damages of theexploitation of the cave which was underneath such owners property.

b. Edwards v Lees Estate:P owns a cave, which became a touristic attraction. 1/3of the cave is under Ds property. D sues to recover profits, and argues that sinceit was a trespass in bad faith, D should recover the entire amount of profits.

1. Held:P is entitled to recover of profits proportional to the amount ofexploitation that occurred in Ps property. B/c 1/3 of the cave used fortourism was underPs property, per the Ad Coelum rule.

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The Transfer of Property Interest:

VIII. DEEDS, WARRANTIES OF TITLE ANDDELIVERY:i. Seizin: Ceremony to official grant possession and ownership from to a certain individual,

and to spread notice of change of ownership.ii. Writing requirement: Per statute of frauds, all conveyances of land must be in writing.

iii. Requirements ofDeeds:a. Description of Property:Must be sufficiently definite as to reasonably

distinguish the conveyed property from other similar properties.

1. If description is unintelligible, courts will attempt to:i. Determine the intentions of the parties

ii. Locate property based on:1. Original survey markers2. Natural monuments3. Artificial monuments4. Maps5. Courses of direction6. Distances7. Common names (Marin Farm).8. Quantity or Size (140 acres).

b. Parties: Must state the names of grantors and grantees.c. Delivery: A deed must be delivered, see below (e).d. Signature:Must bear a signature.e. Must denote intent to convey a present interest in the land.

1. Can be an interest that only becomes possessory until sometime in thefuture.


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2. However, must convey an interest at some point, even if it is a futureinterest that can only take place if a certain condition occurs.

f. Recording (Notarial Acknowledgment): Not necessary to the validity of thedeed, but increases the likelihood that it will be enforced.

g. Consideration: Conveyances do not require consideration. A grantor may giveproperty away.

b. Types of Warranties of Title:i. Warranty Deed: This is usual type of deed and it contains the usual covenants. It

warrants title free of warranted defect, regardless of whether the defect arose before orduring the time the grantor had title.

a. Statutory Warranty Deeds: Statutes that provide that using terms of conveyancecarries the six general warranties (convenants of title).

b. Usual Covenants in Warranties of Title: 6 usual covenants that are conveyedin a deed.

1. Present Covenants:Breached only at the time of conveyance.i. Covenant of Seisin: The seller covenants he owns the property

conveyed.1. Sellers knowledge does not bar sellers suit to rescind

conveyance.ii. Covenant of right to convey: the grantor warrants the he has the

power or authority to convey property. (Ex. Executor may havecovenant of seisin, or possession, but they cannot convey theproperty).

1. Sellers knowledge does not bar sellers suit to rescindconveyance.

iii. Covenant against Encumbrances: The seller promises that thereare no easements, covenants, mortgages, or liens on the property.

1. Sellers knowledge may bar sellers suit to rescindconveyance per modern rule, not per traditional rule.

2. Future Covenants: Can be breached at any time after conveyance.i. Covenant ofGeneral Warranty: The seller warrants that the

buyer will not be disturbed in her possession of the property by thelawful claim of a third party.

ii. Covenant of Quiet Enjoyment: The seller warrants that the buyerwill not be disturbed in her possession of the property by thelawful claim of a third party. (Identical to covenant of generalwarranty, thus often omitted).

iii. Covenant ofFurther Assurances: The seller promises to performwhatever acts are necessary to perfect the buyers title to theproperty. Rare in US, more common in UK.

ii. Special Warranty Deed: Warrants title free of defects that arose only during thegrantors ownership of the property.Unlike the general warranty deed, it does notwarrant against defects that arose BEFORE the grantor had title.

iii. Quitclaim Deed: A deed that does not necessarily warrant anything. It only transferswhatever interest grantor has, or may have, in the property.


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iv. Conditional Delivery: Cannot undertake a conditional delivery.f. Cases:

i. Sweeney v Sweeney: Maurice deeded his farm to his brother, John, to avoid Mauriceswife from obtaining title to the farm. Fearing John would predecease Maurice, Johndeeded back to Maurice. 1

stdeed recorded, not 2

nd. Maurice continued to live and use the

property as if it was his, leasing it.Wife sued arguing that property was part of Mauricesestate.

a. Held: Delivery to grantee cannot be conditional. Conditional delivery can only beeffectuated through a third party. The brothers agreement showed that Johnintended to deliver to Maurice. Maurices use of the property clearly shows hehad interest and understood delivery to have occurred.

ii. Rosengrant v Rosengrant: An elder couple of failing health meant to deed their farm totheir nephew Jay, only after their death. The husband died, and Jay recorded the deed.

a. Held: The deed was not delivered. Grantors do not legally deliver a deed if theyreserved the right to retrieve it, make the deed only operative after grantorsdeath, and continue to use property as if it was their own.

g. Mortagagees duty upon Foreclosure:h. Murphy v Financial:Ps defaulted on mortgage held by D. D postponed mortgage sale to givegreater time forPs payments, but P was nevertheless unable to avoid default. D held sale in

compliance with statutory provisions, but acquired below market price.i. Held: Complying with statutory provisions is not sufficient to comply with lenders

fiduciary relationship of selling in good faith. No other bids were solicited, thus P isentitled to the difference between fair market price and the price actually paid by D.

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IX. THE RECORDING SYSTEM/CHAIN OF TITLE PROBLEMS:a. Problem: Grantor deeds property to A, and then to B. Who owns the property, A orB?

Recording is meant to solve this problem, although not required for deeds to be effective.i. Recording: Grantee files the deed with the county recorder, and the deed is

acknowledged (notarized).

a. Actual Notice of previous conveyances bars purchasers suits.b. Types of Recordings:

i. Grantor-Grantee Index: Conveyance is filed chronologically, with one book forgrantees, and one book for grantors. The name of the grantee is found, and then one findswho the grantor was, who becomes then grantee, and then one finds who granted to thegrantor, and so on.

ii. Tract Index: The index is recorded with respect to the property or tract, not to owners. Acertain tract will have all documents pertaining to it. Significantly simpler than grantorgrantee index.

iii. Consequence of Recording: Recording provides notice of a conveyance.a. Duties of Buyers:If a later purchaser fails to consult the record, he is nevertheless

charged with knowledge of its content.

iv. Consequences of NOT Recording:a. Common Law Rule: First in time rule applies; the first person to record deed has

paramount title.b. Grantor can Re-convey: If grantor conveys property to A, and A does not

record, A can convey property to B, although grantor is liable to A for difference


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of profits and/or payments.

v. Incorrectly recorded deeds:a. Traditional Rule: Purchaser is charged with constructive notice of record even

when there is no official index which will direct purchaser to deed.b. Modern Rule: Un-indexed or incorrectly indexed deeds discharge buyers duties

if exercising due diligence.vi. Mother Hubbard (Omnibus) Clause: All-encompassing deeds that fail to specifically

describe the property being conveyed using language such as and all other land thegrantor owns, or all other mineral rights the grantor owns.

a. Not enforceable against third party good faith purchasers.vii. Mother Hubbard Clause (MHC) Cases:

a. Luthi Evans: Owen assigned D seven mineral interests, and all Coffey Countymineral interests, whether or not enumerated above (MHC). Owen thenassigned an un-enumerated interest to P.

1. Held: The MotherHubbard clause is only enforceable as to the parties,not as to a third party good faith purchaser. Here, although P exercised duediligence, P did not find that Owens deed had been conveyed. Thus, P has

paramount title.

viii. Misspelled Names: Spelling differences that are substantially different make deed void,such as Church or Kirk.

a. Traditional Rule (IdenSonamis): A name spelled substantially similar andwhich begins with the same letter provides constructive notice.

b. Modern Rule: Only names spelled correctly provide constructive notice.ix. Misspelled Names Cases:

a. Orr v Byers: Rejecting the IdenSonamis doctrine holding that Elliot, instead ofElliott, does not give constructive notice.

x. Type of Recording Jurisdictions:a. Race Acts: If G conveys property to A, and then to B. The first of A and B to

record prevails in a dispute of ownership between A and B. It is irrelevantwhetherB knew A had title.

1. First to record.b. Notice Acts:If G conveys property to A, and then to B. B will prevail even ifB

does not record so long B is a bona fide purchaser: that is,1. (1) B lacked knowledge of the conveyance to A, and2. (2) A did no record.

c. Race Notice Acts: Subsequent Bona Fide Purchaser must (1) lack knowledge ofthe conveyance to A, and (2) record prior to the previous purchaser.

xi. Notice: Can be constructive or actual.xii. Bona Fide Purchaser:

a. Must purchase property, or be a creditor or mortgagee.b. Must purchase property lacking actual or constructive notice.c. Must give valuable consideration.

xiii. Cases:a. Messersmith v Smith: Messersmithdeeded to P, and then deeded same property

to Smith, who deed to D. The deed from Messersmith to Smith was found to bedefective, but was recorded first than the deed from Messersmith to P.


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1. Held: In a race notice jurisdiction, a deed that is incorrectly recorded isvoid against the correctly recorded deed of a bona fide purchaser whichrecords before the initial deed is correctly recorded.

xiv. Chain of Title: Refers to the issue of whether all the links between the original grantor tothe parties are valid as to warrant Ps claim of quiet title.

xv. Chain of Title Cases:a. Board of Education v Hughes:Hoerger deeded property to D & W who did not

record. D & W deeded property to P, who did record. Hoerger also deededproperty to D, who recorded afterP, but before D & W. P sued to quiet title.

1. Held: D has validtitle, b/c Ds recording is first than D &Ws. Thus, thereis a missing link between Hoerger and P, namely, Hoerger-to-D & W.Thus, Ps recording appears to be a recording of a stranger and is void.

b. Guillette v Dry Wall Ink:Landowner sold property to P with ordinancerestricting non-family dwellings. Landowner sold adjacent property to D, withoutrestriction in the deed, but alluding to the restriction being present in other deeds.P sought injunction to prevent Ds construction of building.

1. Held: Restriction not found in Ds deed is enforceable against P, becauseD is a subsequent purchaser, and thus is bound to restrictions found in the

chain of title, such as those in Ps deed.

xvi. Persons Protected: Notice statutes protect good faith purchasers, and good faithcreditors.

a. Daniels v Anderson: Grantor granted deed to D including a right of first refusalfor adjacent land. Deed was recorded, but refusal contract was not. P boughtadjacent land, but continued to make remaining payments after knowing of Dsright of refusal.

1. Held: D is not a good faith purchaser b/c D was aware ofPs right of firstrefusal.

xvii. Mortgaged Property:a. Lewis v Superior Court: P bought a house, made down payment, and recordeddeed. D recorded a lispendis (lien indicating there is pending litigation pertaining

property) shortly afterPs deed was recorded. D argued deed was defective b/c Phad not paid the entire amount of the house.

1. Held: A party who records an interest in property after a good faithpurchaser records deed even if purchaser has not paid for entire property.Here, D lost priority when recording lien afterPs deed recording.

b. Harper v Paradise:A deed which specifically refers to an earlier un-recordeddeed puts a subsequent purchaser on notice of the existence of the earlier deed;thus, the purchaser claiming under the later deed is not entitled to priority, thoughthe later deed was recorded first.

c. Waldorff: Actual possession of property constitutes constructive notice of theoccupants interest in the property even if other occupiers are not owners.---------------------------------------------------------------------------------------------------------------------------------------

X. THE FEE SIMPLE, THE FEE TAIL AND THE LIFE ESTATE:a. Estates Generally: A legitimate possessor of land, real property, owns an estate of land rather

than the land itself.i. Possessory Estate: Legal right to occupy land immediately or in the present.


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ii. Seizin: Ceremony to official grant possession and ownership from to a certain individual,and to spread notice of change of ownership.

a. Freehold Estates: Ownership rights granted after seizing ceremony.1. Fee Simple (alienable and inheritable).2. Fee Tail (Restricted, alienability and freehold).3. Life Estate (alienable, freehold but only for Grantees life).

b. Non-freehold (leasehold) Estates: Possession awarded subject to the ownershiprights of party who obtained freehold estate rights through seizing.

1. Tenancy at will2. Periodic Tenancy3. Tenancy for a fixed term.

b. Fee Simple Absolute: It is an absolute grant by the grantor to the grantee with perpetualduration.However, it is subject to governmental requirements, such as taxes.

i. The occurrence of no event can cut itshort(hence, it is absolute).ii. It has the potential of enduring forever(hence, it is simple).

a. Characteristic Language: To B and his heirs.1. The words and his heirs meant that the grant is capable of inheritance,

and therefore, of potentially infinite duration.

b. Modern View: The words to his heirs are not necessary. The usual rule is thatgrantor conveys his entire estate unless the grant is to the contrary.c. Alienation: A fee simple absolute is freely alienable, devisable by will, or

inheritable in intestacy.d. Inheritance: In strictly legal terms, refers to granting title intestacy: That is, a

person who transfers title to his heirs after dying without a will.

c. Fee tail: A grant from the grantor to the grantee and the grantees heir only if the grantee haschildren. Reverses back to grantor whenever the tenant does not have a lineal descendant tosucceed him.

i. Modern Interpretations ofFee Tail:a. Fee Tail is in reality a fee simple absolute.b. Fee tail is in reality fee simple subject to condition subsequent that grantee has

children.c. Voiding Fee Simple: Lineal descendant deeds fee simple to a straw man who in

turn re-conveys to the lineal descendant in fee simple.

d. Life Estate:Possessory estate that expires upon the death of a specified person, usually theholder. Usual terms: Grantor for grantee for life, or grantor to grantee for Xs life.

i. Future interest always follows life estate:a. Reversion: Grantor to grantee for grantees life: deed reverts to grantor when

grantee dies.

b. Remainder: To Ys for life, then to X and his heirs. The remainder of Ys lifeestate goes to X.ii. Types:

a. Per life of grantee.b. Per autrevie: for anothers life.

iii. Defeasible Life Estates: Life estates can be made defeasible, that is, subject to acondition.

iv. Life Estates in a group of class of people: Life estates can be conveyed to a group ofpeople. When one of the grantee dies, deed can revert to grantor, or be absorbed by othergrantees depending on the jurisdiction.


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v. Transferability: Grantee of life estate can transfer possessory interest but the transfereeonly has possessory interest during the life which measures the transferors life estate.

vi. Ambiguous Terms:a. Unless the words and context of the deed represent clear indication that the

grantor intended to convey only a life estate, the deed will be interpreted asconveying a fee estate. White v Brown.

vii. Duties and Rights of Life Tenants:a. Avoid waste or unreasonable deterioration of property.

1. An act constitutes waste only if it diminishes the value of the property.Woodrick v Wood.

b. All improvements made by the life tenant are done at his own risk.c. Life tenants can only recover damages done to their life estate, not to the property

as a whole.d. Equity may intervene to sell sections or the entire state only if it is in the best

interest of all parties. If parties cannot agree upon sale decisions, the courts canenforce an agreement. Baker v Weedon.

e. Future Interests: Interest in property that exists in a present time, but that only conveys, or mayonly convey interest in the future.

i. Ex: G deeds property to A, but first reserving life estate for himself (G). A has a futureinterest that will become possessory after G dies.

ii. Future Interest is Fixed: Future interests are fixed when created. If transferred,interests character does not change.

iii. Alienability: Future interests are alienable, especially the right of entry, depending on thejurisdiction.

f. Future Interests in the Transferors:i. Reversion based on life Estate: Future interest left in the grantor of a life estate when

grantor deeds lesser estate than what grantor holds.(Key word: lesser).a. Ex: G conveys blackacre to A for life. A has life estate and G has reversion on fee

simple.G has reversion b/c As title, life estate, is lesser than Gs fee simple.ii. Possibility of Reverter: Future interest where G conveys a determinable fee of same

quantum, almost always a fee simple determinable (fee simple subject to a condition).a. Ex: G conveys blackacre to A so long as A remains unmarried. G has a possibility

of reverted if A fails to comply with the condition of being unmarried.iii. Right of Entry: Future interest that follows an estate subject to a condition subsequent,

and allows grantor right of entry but does not terminate estate on grantee.a. Ex:G conveys blackacre to A so long as A remains unmarried, or G may re-enter.

1. Right of entry may also be a right of entry and termination of interest.g. Future Interests in the Transferees:

i. Vested Remainders: Remainder vested in a known grantee, which is not dependent to acondition precedent.a. Ex: G to A for life, and then to B and her heirs. Because B (or her legal

successor) is a known grantee of Gs conveyance, B has a vested remainder.1. Gs death is not a condition precedent, because it simply represents the

end of the previous estate. There are three sub-categories of vestedremainder:

b. Indefeasibly Vested: Vested reminder that (1) is certain to grant possession to thegrantee, and (2) grants the grantee with permanent possession (fee simpleabsolute).


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1. G to A for life, then to B and his heirs.B has an indefeasible vestedreminder.

c. Vested Remainder Subject to Complete Divestment (Defeasance): Remaindercreated to in a known person and not subject to any condition precedent, but

subject to a condition subsequent, that if occurs, will completely divest the

remainder-man of interest. (ALWAYS CONDITION SUBSEQUENT).

1. G to A for life, then to B and her heirs, but if C returns from War, to C andher heirs.

i. B has a vested remainder subject to complete divestment if Creturns from war. If A dies before C returns from war, B has feesimple, however.

d. Vested Reminder Subject to Open Class: Same as an indefensible reminder, butdifferent in that the grantee is a class that may be expanded.

1. G to A for life, then to Gs children who graduate from Law School. If Ghas only three children, G1 G2 and G3, G1 has a vested remainder subjectto Open Class because it is subject to G2 and G3 graduating from lawschool.

i. Closing the Class: The class is closed when no more possiblemembers can join, such as if G1 G2 and G3 graduated from Law

School.

ii. Contingent Remainders: Remainders created in an unknown person OR subject tocondition precedent. (ALWAYS CONDITION PRECEDENT).

a. GRANTOR ALWAYS RESERVES REVERSION.b. Ex Unknown Persons: G to B for life, then to Cs children. C is 12 and has no

children. Cs non-existent children have a contingent remainder.

c. Ex Condition Precedent: G to B for life then to C if she graduates fromPrinceton. C is 12 years old. C has a contingent remainder subject to conditionprecedent, her graduation from Princeton.

iii. Alternative Contingent Remainders: G to A for life, then to B so long she has nevergone to Canada, but ifB has never gone to Canada, to C.

a. Bs deed is subject to condition precedent, not going to Canada, but so is Cs, thatC has gone to Canada. Thus they both have alternative contingent reminders.

iv. Alienability ofFuture Interests:a. Traditional Rule (Largely Discredited): Future interests are not alienable.b. Modern Rule: Future interests are alienable.

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XI. DEFESEIBLE ESTATES: A defeasible estate is that which is defeasible, that is subject totermination upon a certain event.

a. Fee Simple Determinable: Fee simple subject to a certain restriction, conditionprecedent,which terminates the possessory state in the event it occurs.

i. Possibility of Reverted: Because the fee simple determinable is subject to termination inthe occurrence of a certain event, the grantor has the possibility of recovering ownership,that is, has the possibility of reverter.

a. Ex: G grants blackacre to Aas long as A uses to grow apples.b. Distinguishing Language: As long as, until, during, or while are some

distinguishing terms.


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c. Cases -Mahrenholtz v. County Board of School Trustees:D grants blackacre toP in fee simple, only for so long as Blackacre is used as the SYC clubhouse and,if not so used, the estate here granted shall automatically terminate, and allinterest reverse to grantor.

1. Held:The language of the grant is sufficiently clear as to denotes intent togrant a fee simple determinable, even when the grantor did not call the

grant a fee simple determinable, but a fee simple.

ii. Transferability: Aestate on fee simple determinable is freely transferable, but suchestate remains nature of the estate remains the same, subject to the same condition.

b. Fee Simple Subject to Condition Subsequent:A grant which intends to convey fee simple butreserves the possibility of reverted in the event that a certain situation occurs.

i. Right of Entry: If such circumstance occurs, fee simple subject to condition subsequentmust engage in acts that substantially exercise the right of entry, and terminate theownership rights of the grantee.

a. Distinguishing Words:Provided, however, in the condition that, but if.b. What constitutes Substantial Steps to recover: Sending a letter or proclaimingintent to recover is insufficient, initiating legal proceedings is.

ii. Transferability: As fee simple determinable, fee simple subject to condition subsequentapplies but is subject to the same condition subsequent before conveyance.

c. Preference for Fee Simple Subject to Condition Subsequent: Fee simple subject to conditionsubsequent is preferred to Fee Simple determinable, given that the latter is subject is subject toautomatic forfeiture, whereas the latter requires substantial steps to recover ownership. Courtsdislike removing property from owners.

d. Consequences of Classification as Defeasible Estate:i. Transferability of Interest Retained by Grantor:a. Common Law: Possibility of reverter could not be alienated or devised, only

inherited.b. Modern Rule: Possibility of reverter retained by grantor is freely alienable.

ii. Adverse Possession:a. Traditional Rule: For a claim of adverse possession, brought against the

grantee by the grantor after exercising reverter, the statute of limitation onlystarts to run when the grantor with possibility of reverter initiates steps to recover.

b. Modern Rule: The grantor with possibility of reverter losses the right to entryand recover if not exercising such right within a reasonable time.

e. Invalid Restraint on Alienation: Courts are unlikely to uphold fee simples subject to conditionsubsequent which impose unreasonable restraints in alienation.

i. Mountain Brow Lodge v Odd Fellows: D granted property to P, but required theproperty to only be used by P, and to not be sold, or otherwise the property would returnto D. P sued seeking quiet title arguing the grants were invalid restraints on alienation.

a. Held: Restrains on the use of property are valid, but restrains upon the alienabilityof property are not. Thus, Ds condition that only P can use the property while Powns it is valid, but the condition that P cannot sell it is void.

f. Valuation of a Defeasible Fee and the Associated Future Interest:


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i. In Cases of Eminent Domain when the grantee loses property and the subsequent use ofthe property violates the condition imposed by the grantor, the grantor is entitled torecovery. City of Canton.

g. Fee Simple Subject to Executory Limitation: Grantor grants property in fee simpledeterminable, or in fee simple subject to condition subsequent, but instead of reserving thepossibility of reverter, states that the property would be transferred to a third party.

i. Ex. A grants property to B so long as the property is cropped once a year, but if it is notcropped once a year, then to C.

ii. C has an executory interest, and B has a fee simple subject to executory interest.iii. Transfer: Most jurisdictions hold that transfer of an executory interest when the

restricting condition occurs is automatic, regardless of whether the grant came from a feesimple determinable or a fee simple.

h. Restrains of Alienation ofFreehold Estates: Restrains on alienation on free hold estates arealmost universally void, for purposes of social efficiency.

i. Forfeiture: Attempts to convey the property to another in the event the grantee seeks tosell property. Ex. G to A, but if A tries to sell to B. Forfeiture is not void.

ii. Disabling: A disabling restraint purports to disable the owner from selling the property.Ex. G to A, but A cannot make any further valid transfer. Disabling is not void.

iii. Promissory: Purports to extract a promise from the transferee that she will not transferthe property. Ex. G to A, but A promises not to sell. Promissory restrictions are void.

i. Total Restraints on a Fee Interest v Partial Restraints on Life Estates:i. Total Restraints: Restraints which preclude alienability at all instances are void.

ii. Partial Restraints: Only valid if for a reasonable purpose, and for a limited duration.j. Restraints of Life Estates: Most readily alienable. Pg 50 of Emmanuels if needed.

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XII. EXECUTORY INTERESTS:a. Springing Executory Interests: A future interest created in a granteethat divests that grantor at

some future time after conveyance. Thus it springs out of the grantor.i. Ex. G to A, if A returns from the war alive. If A returns alive, the property will spring

from G to A.ii. Ex. G to A, but then to B ifB gives a proper funeral to A. It is NOT a contingent

remainder b/c when A dies, the estate immediately reverts to G, and then to B per aproper funeral.

b. Shifting Executory Interests: The estate is granted to one party, but shifts to another in theevent that a certain condition occurs.

i. Ex. G to A, but ifB returns from war, to B. IfB returns from war, the interest shifts fromA to B.

c. Proposed Classification of the Restatement Third of Propertyi. Types ofFuture Interests: Rest. 3rd would label all simple future interests whether they

are possibilities of reverter, rights of entry (power of termination), remainders,reversions, or executory interest.


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ii. Classification ofFuture Interests: Rest. 3rd would treat all future interests that are notcertain to become possessory as contingent future interests.

d. Trusts: Arises when a person, the trustee, holds legal title to property (the res) for the benefitof another person, the beneficiary.

i. Ex. A parent (settlor) sets aside a sum of money, (the res), for the benefit of his children,(the beneficiaries), the trust being managed by a bank (trustee).

ii. Express Trusts: An express trust requires the following:a. Trustor must manifest an intention to create a trust for the benefit of another.b. A res, beneficiary, Trustor, and trustee must be identified. The Trustor can

identify himself as beneficiary.iii. Resulting Trusts:

a. Can result if an express trust fails.b. An agent gives money to a trustee, and the agent takes the money for his own

title. The Court is likely to decide that the agent is a resulting trustee if his master.iv. Constructive Trusts: Arise to prevent unjust enrichment. The person who is unjustly

enriched becomes a trustee to the person who was cheated.a. Ex. A fraudulently induces G to convey blackacre to A. Blackacre is said to be

held in a constructive trust for G as a beneficiary.

v. Alienability (Subject to Creditors):a. Traditional Rule: Trustees are subject to creditors when the beneficiary defaults,b/c it permits to have an estate to live on, but not an estate to pay his debts with,and allows perpetuation of aristocracies.

b. Modern Rule: Creditors cannot reach a beneficiarys trust to hold themaccountable for their default, because they can investigate whether the beneficiaryis otherwise worthy of credit. Broadway National Bank v Adams.

e. Marketability Rules: Designed to eliminate uncertainty of conveyance, and restrictions thatinhibit alienability.

i. Destruction of Contingent Remainders: At common law and minority rule today, if acontingent interest does not vest at the termination of the prior freehold estate, theremainder was destroyed and never took effect. (REPLACED BY THE RULE

AGAINST PERPETUITIES).

a. Ex. G to A for life, and then to As children who marry before 25. If at As deathnone of As children have married before 25, then the deed reverts to G.

ii. Merger: Occurs if the same person held the present possessory freehold estate (the lifeestate) and the next vested estate, in which event the two titles would emerge to form onepossessory fee simple.

iii. Rule in Shelleys Case:If an instrument (i) creates a freehold estate in A and (iii) alsocreates a remainder in As heirs, and (iii) both estates are valid, then the remainderbecomes a fee simple remainder in A (A has fee simple).

iv. Doctrine of Worthier Title: If an inter vivos (meaning while the grantor and the granteeare alive) creates any further interest in the heirs of the grantor, the future interest is void.Instead, the grantor retains reversion.

a. Ex. While G is alive, G conveys Blackacre to A for life, remainder to my heirs.Since G is alive and conveyed an interest to his heirs, G reserves a reversion.

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XIII. THE RULE AGAINST PERPETUITES: No interest is good unless it must vest, if at all, notlater than twenty-one years after some life in being at the creation of the interest.


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a. An interest must surely vest, or not vest, 21 years after the death of a person who is alive atthe time of the grant, and who is in some way involved with the grant.

b. First Step: Determine whether the future interest in question is subject to the RAP.i. COVERED BY THE RAP: ONLY CONTINGENT REMAINDERS, EXECUTORY

INTERESTS, AND CLASS GIFTS ARE SUBJECT TO RAP.ii. NOT COVERED BY THE RAP: FUTURE INTERESTS RETAINED BY THE

GRANTOR WHICH ARE VESTEDAT THE TIME OF CONVEYANCE.

c. Second Step: Determine whether the interest will fail, or fail to vest, within the duration oflives in being plus 21 years.

i. Validating Life: Find a person, who is relevant or can affect the grant, and make it thevalidating life. If after such persons death there is uncertainty as to whether thedeed will vest, then the deed is void.

ii. Camerons Approach: Kill everyone in day one.d. Third Step: Evaluate the reminder, is there the possibility that uncertainty remains after 21

years the measuring life has ended? If so, then the deed is void per RAP.

e. Gifts to Classes: Although for most purposes a grant to a class vests as soon as there is amember of the class, for purposes of the Rule, a grant to a class does not vest until the classcloses and all conditions precedent are satisfied.

f. Classic Traps for the Unwary:i. The fertile Octogenarian: The rule that a person of any age, whether male or female,

can produce a child. This presumption can lead to some harsh results.

ii. The Unborn Widow: The rule presumes the possibility that aged men and women mightsubstitute fresh youngsters for the elderly mates so young that they were not even bornat the time of the grant.

a. Ex. To A for life, then to As widow for life, than to their children.1. As wife could die, and A could marry someone who was not yet born atthe time of conveyance. Thus, the grant to As wife is valid, as it will vest

immediately after As death. However, the grant to As children is invalidbecause it may not vest after 21 years of As death.

g. Cases:i. Symphony Space Inc. v Pergola Properties: D reserved a right of purchase in 1978,

exercisable any time until 2003, to property it leased from P. The value of the propertyincreased substantially, and P exercised the right in 1978.

a. Held: Because the rules intent was to foster alienability, using the corporationslife would contradict such purpose, because corporations have unlimited life.

Thus, the measuring life in this case is 21 years, and the deed is void because itfails to vest within 21 years.

h. Reforms:i. Wait and See Doctrine: Establishes that the courts should determine whether

uncertainty remains as the events unfold, notwith regards to what could happen.a. Ex. In the Estate of Anderson: Applied the wait and see doctrine, in an attempt

to honor the intention of the parties, because a rigid interpretation would renderresults contrary to such intention and to public policy.

ii. USRAP Wait and See: The Uniform Statutory Rule against Perpetuities established aperiod of 90 years to wait and see.


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iii. Reformation ofDeed: Some courts apply the cy pres doctrine of wills in which theparties are allowed to reform the document, or the court reforms the document toconform to the intentions of the parties, even after the 90 years of waiting under USRAP.

i. Abandonment of the Rule:Perpetual Trustsi. Several states have made the RAP inapplicable to trusts for tax reasons, and trusts are

where most future interests are vested.

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XIV. CONCURRENT TENANCIES:a. Definition: Occurs when the same interest in property is owned at the same time by two or more

individuals.There are four types:i. Tenancy in Common

ii. Joint Tenancyiii. Tenancy by the Entirety

b. Rights of Survivorship: When there are rights of survivorship included in concurrentownership, if common owner A dies, then As rights go to common ownerB.

c. No Rights of Survivorship: When there are NO rights of survivorship, if common owner Adies, As ownership rights go to As heirs, not to B.

d. TENANCY IN COMMON: Tenants in common own separate but undivided interests in sameproperty. Each tenant in common owns the entire property but must necessarily share thatownership with the other tenants.

i. Ex. A and B own a boat. Both A and B can sail it, but must allow the other to do so.ii. Creation: A tenancy in common is created by express conveyance orby inheritance.

iii. Presumption of Tenancy in Common: A deed to two or more people is interpreted ascreating a rebuttable presumption that a tenancy in common has been created.

iv. Right to Possession: Each tenant in common is entitled to possession and use of theentire property, unless another tenant objects or there are regulations among tenants.

v. Alienability: A tenancy in-common interest may be alienated, devised, or inheritedseparately from other tenancy in common interests.

vi. NO RIGHT OF SURVIVORSHIP IN TENANCY IN COMMON!vii. Uneven Shares: Tenants in common can own uneven shares of the same property.

e. JOINT TENANCY:Joint tenants own an undivided share in the same interest in either real orpersonal property.

i. Nature ofJoint Tenancy: Joint tenants are conceived as bound together as a singleowner, thus they are joint.Each joint tenant owns and entire interest of the

property.ii. SURVIVORSHIP RIGHTS: The hallmark difference between joint tenancy and

tenancy in common is that joint tenancy provides survivorship rights to joint tenants, anddoes not require probate, a procedure by which a decedents property is transferred.

iii. Four Unities (Requirements) ofJoint Tenancy:a. Time: The joint tenancy must receive their interests at the same moment in time.b. Same Title: All joint tenants must receive their interests under the same

instrument: a deed a will, or a decree quieting title or by joint adverse possession.c. Interest: Each joint tenant has the identical interest in the property.

1. Each joint tenant has the same share.


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2. Each joint tenant has the same durational estate.i. Ex. Both have fee simple, or life estate.

d. Possession: At creation of joint tenancy, each joint tenancy must have the right topossession of the whole property.

1. Subsequent Agreements: Subsequent agreements of joint tenants withregards to possession rights do not affect the possession element.

iv. Creation ofJoint Tenancy:The presumption when property is conveyed to two or morenon married parties is that a tenancy in common has been created, unless there is clearevidence of the creation of a joint tenancy.

a. Evidence Sufficient to determine a joint tenancy:1. To A and B, as joint tenants with RIGHT OF SURVIVORSHIP.

b. Wording that can be insufficient to determine joint tenancy:1. To A and B as joint tenants: Some states hold that a joint tenancy must

state right of survivorship.2. To A and B jointly: Jointly can be construed to denote any type of co-

ownership.3. To A and B, joined together: Can be construed as creating a tenancy in

common.

c. Creditors: The creditors to one of the joint tenant mustrecover debt to such jointtenant prior to such tenants death, because afterwards they cannot recovertowards the other joint tenant.

v. Severance ofJoint Tenancy:a. Traditional Rule: Any destruction of any of the four unities.b. Modern Rule: A joint tenancy is divided if the parties have the intention of so

doing.c. Conveyance: When three or more parties are joint tenants, conveyance of one

joint tenant will only affect the joint tenancy of the conveying tenant, not that ofother parties.

1. Ex. A, B and C, are joint tenants. C conveys Cs interest to D. A and Bcontinue to be joint tenants, but D is now tenant in common with A andB, who are viewed as a unit.

vi. Straw Man Required to sever Joint Tenancy:a. Traditional Rule: A joint tenant cannot convey to himself in order to create a

valid conveyance that severs the joint tenancy and destroys survivorshiprights. A straw man is required.

b. Modern Rule: A joint tenant can convey to himself and sever the joint tenancy,destroying survivorship rights. A straw man is not required, b/c the rights of theparties should be respected. Riddle v Harmon.

vii. Mortgages: Jurisdictions are split as to whether a joint tenants action of mortgaging aproperty severs the tenancy. There are two views:

a. Title theory of mortgages: A mortgage by one joint tenant severs the jointtenancy and the survivorship rights.

1. Criticism: Is often contrary to the intent of the mortgagor, who possiblydid not know that the joint tenancy would be severed.

b. Lien Theory of Mortgages: A mortgage by one joint tenant does not sever thejoint tenancy; it only creates a lien (the power of the mortgagor to take title whena default occurs).


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1. Criticism: At the death of the mortgagor, the lender cannot recover fromthe other joint tenants.

2. Ex. Harms v Sprague: P and his brother owned land as joint tenants. Psbrother mortgaged the property. After the death ofPs brother, P sued D,the lender, to quit title arguing that the joint tenancy had not been severedand that he had complete ownership of the property.

i. Held: The intent of the parties should be honored, and here, Psbrother did not intend to destroy survivorship rights.Thus, a

mortgage does not sever joint tenancy and P is entitled to completeownership of the property not subject to Ds lien.

3. Ex. Giles v Sheridan: Where a conveyance of property is made to two ormore persons, and the instrument is silent as to the interest which each isto take, the rebuttable presumption is that their interests are equal.

i. Mortgages: In Giles the court held that findings that the interest inproperty of different parties is equal also results in that theirobligation towards mortgages is equal.

viii. Leases: Jurisdictions are split as to whether a lease severs a joint tenancy.a. Traditional Rule: A lease severs a joint tenancy.b. Modern (Majority) Rule: A lease does not sever joint tenancy, nor is the leasevalid after the leasing joint tenant has died.

ix. Severance by Agreement: A joint tenancy can be severed by agreement, so long as theintention of the parties is clear, such as in the case of marital dissolution.

x. Severance Operation of Law: Joint tenancies are often severed by voluntary act, butthey can be severed by operation of the law in the following instances:

a. Criminal Homicide: When one joint tenant kills the other(s), the law rules thatthe killing party should not be benefited.

b. Simultaneous Death: Unless the estate of one party shows that such partysurvived the other for 120 hours, simultaneous death severs a joint tenancy.

xi. Bank Accounts: When a bank account is in the name of both parties, Courts will onlyrule that such bank account is in joint tenancy if the intent of the parties is construed to beso. Ex.A bank account held by A and B so that A can pay Bs bills, not a joint tenancy.

f. RIGHTS ANDDUTIES OF CONCURRENT OWNERS:i. Partition: Common owners may request that the property be divided. Courts will permit

a partition in kind, and not a partition in sale.a. Partition in Kind:Physical division of the property, will be favored by the courts

because it allows tenants to retain ownership of some segment of the property.

b. Partition in Sale: Selling of the property and division of the profits. Will only beawarded when the party seeking partition can show that partition in kind isunworkable, extremely impracticable, or it is not in the best interest of the owners

1. Ex Delfino v Valencis:P and D owned property as tenants in common. Owanted to partition in sale, in order to develop the property into housing.D held a trash business in her segment of the property, and contended thatpartition in sale would be injurious to her.

i. Held: The burden is on the party requesting partition in sale toshow that such alternative is better. Here D lived in her segment ofthe property, and ran a trash business. Thus, she would be injured


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by partition in sale. Partition in kind is therefore the best solution.

ii. Rents: Whether one co-tenant is liable to other co-tenants for rent due to completelyoccupying the property.

a. Traditional Rule (Majority): A cotenant in exclusive possession has no duty topay rent to other co-tenants unless there is (1) an agreement, (2) a fiduciary duty,(3) and ouster.

1. Ex (Ouster) Spiller v Mackereth:P and D owned a commercial buildingD occupied the building completely. P then demanded that D vacated,when D refused, P sued for retroactive rent.

2. Held: A cotenant has the full right to use the premises and is not liable toother co-tenants for rent, unless there is an ouster. An ouster requires thatthe co-tenant physically prevents the occupying tenant from entry. Herethere was no such thing.

b. Minority Rule: A cotenant is liable for the reasonable value of rent for occupyingthe entire premises, unless there is an agreement to the contrary.

iii. Leases to Others: The general rule is that co-tenants can lease to others without theapproval of other co-tenants, but all co-tenants have equal right to a share of the rent.

a. Swartzbaugh v Sampson:P and D were married and jointly owned property. Dleased a segment of the property to a third party, where such party intended tobuild a boxing facility. P, the wife, disapproved at all time of this lease.

1. Held:P could only void the lease if she could prove that the third party isinterfering with her enjoyment of the property. She has not met suchburden here, so she can only recover her proportional share of the rent.

iv. Other Matters Tenants in Common and Joint Tenants must take in Accound:a. Mortgagesb. Taxesc. Improvementsd. Liabilitye. Adverse Possession: A cotenant must give his cotenants absolutely clear and

unequivocal notice that he claims exclusive and sole title in order for adversepossession to begin.

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XV. MARITAL INTERESTS:a. TENANCY BY THE ENTIRETY: A form of joint tenancy only available to married couples.

i. Four Unites required + Marriage: Tenancy by the entirety requires the four unitiesnecessitated by Joint Tenancy, PLUS marriage.

ii. One Legal Person:Tenancy by the entirety creates one legal person.a. Married Womens Property Act:

1. Women acquired equal property rights to alienate her possession and hersurvivorship rights. OR,

i. Creditors: Can seize the ownership rights of the wife, if shedefaults, but will become joint tenant with the husband.


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2. Neither Spouse is allowed to alienate their possession or any survivorshiprights.

i. Creditors: Property held in tenancy by the entirety may not besubjected to claims of creditors only against one spouse.

ii. Ex Sawada v Endo: Creditors or involuntary creditors of onespouse only, cannot seize the entire interest of the property held intenancy by the entirety. This would penalize innocent spouses.

iii. No Severance: A key attribute of the tenancy by the entirety is that is cannot besevered.

iv. Rebuttable Presumption of Creation: The majority rule is that conveyance of land tohusband and wife creates a rebuttable presumption that a tenancy by the entirety has beencreated. (Attempts to create tenancy by the entirety to couples not legally married willfail).

v. Cases:a. Newman v Chase: P, bankrupt husband, defaulted and had to sell in bankruptcy

sale. D bought property, and sued for partition of the property.1. Held: Partition not reasonable. Under a Hegelian view, the wife and the

children had lived in the home, and would not be in the interest of justice

to force such family to sale. However, the court held that the respondentwho had acquired interest in a bankruptcy sale was entitled to damages.

b. Wilde v Mounts: Holding that conveying property in tenancy by the entiretydestroys one spouses survival rights, and that a lien in that runs with the landaffects tenancies by the entirety that are acquired with such lien attached.

c. Beal v Beal:Holding that husband and wife of an unmarried couple who livedtogether and invested roughly the same amount in the house own an equal andundivided half of such house.

vi. Modern Statutory Provision for Dissolution of Marriages:Most jurisdictions allow forequitable distribution of property between husband and wife.

a. Professional Degrees: Courts are split as to whether a spouse who supported theother spouse while the latter acquired a professional degree, deservescompensation. There are three main approaches:

1. Not Property:Professional degrees are not property; they are only atangible achievement. Thus, the supporting spouse is not entitled tocompensation or to a share of the professionals earnings.

i. See, In Re Marriage ofGraham.2. Property Subject to Distribution: If one spouse supports another, and

the latter achieves a very high earning potential due to such support, theformer spouse is entitled to a share of the professionals earning potential.

i. See, Elkus v Elkus.3. Restitution: Some courts rule that the supporting spouse is entitled torestitution for the support provided.

i. See, Mahoney v Mahoney.vii. Prenuptial Agreements:

a. Traditional Rule:Not enforceable at common law.b. Modern Law: Enforceable if (1) the parties assets and earnings have been fully

disclosed, and (2) the substantive terms of the agreement are not unconscionable.1. See, Uniform Marital Property Act; Uniform Premarital Agreement Act.


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XVI. LEASEHOLD ESTATES; DELIVERY OF POSSESSION:a. Definition: A lease is a freehold estate which conveys a possessory interest upon a certain

property.i. Unlike easements, licenses, or profits, a lease always conveys profits.

b. Types of Leases:i. Term of Years (Fixed): A lease for a fixed term, or subject to a condition subsequent.

a. Fixed Term: A lease of three years; a lease ending on May, 2013.b. Subject to Condition Subsequent: The majority rule treats this type of lease as a

term of years.1. Ex. Until the war ends, until comet Haley comes back.

ii. Periodic Tenancy: Leasehold for a recurring period of time, such as month to month,or year to year. Can be determined by express agreement or by implied circumstances.

a. Termination: Either the tenant or the landlord can terminate by giving reasonableadvance notice.

iii.

Tenancy at Will: A lease for no fixed period of time. Either party has the right toterminate.a. Termination:Either party has the right to terminate the lease.b. Distinguished with Determinable Tenancy: Only one party has the right to

terminate.1. Uncertain Leases:For along as tenant wants . . . .

i. Older View: Leases that appear to be of indefinite duration but areambiguous as to the rights of the parties are tenancies at will.

1. OReilly v Frye:Holding that a lease for as long as youplease for $ 40 per month was of uncertain duration, thuswas a tenancy at will terminable by either party.

ii.

Modern View: The intention of the parties must be executed.1. Garner v Gerrish:Holding that a lease until tenantdecides to terminate creates a determinable leasehold lifeestate, because such language denotes an intention togive rights of termination only to the tenant.

iv. Termination of Leases:a. Landlord: Gives notice and/or asks to vacate.b. Tenant: Gives notice or abandons the property.

v. Tenancy at Sufferance (Holdovers): Occurs when a tenant remains in possession afterthe lease expires. Tenancy at sufferance is a legal limbo, the tenant is not a trespasser, buthas no right to be there.

a. Holding Over: A tenant is a holdover if the tenant voluntarily engages in actionthat can be reasonably construed to indicate an intention to remain in possessionafter the lease has expired. The landlord has two options:

1. Eviction and damages: The landlord can evict the tenant and recoverdamages equivalent to pro-rated rent for the holdover period.

i. Execution of Eviction: Courts usually favor eviction throughcourt proceedings, but some courts allow reasonable self-help.

2. Electing a New Term: If the tenant is a holdover, the landlord can elect tobind the tenant to a new lease equivalent to the prior lease.


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b. What constitutes election: If the landlords actions, either express or implied,can reasonable be construed as opting for eviction or binding to a new term, suchelection is irrevocable.Examples of such election are as follows:

1. Eviction: Self-help, notice, initiation of legal proceedings.2. Election to new Term: Collecting rent, not requesting eviction.

i. Ex C & P v Smith:P leased building space to D. P notified thatthe lease will not be renewed after its expiration, but D refused tomove. D paid a months rent afterwards, which P accepted.

1. Held: Election of remedy for holdover tenancy isirrevocable. Here, by accepting payment for the firstholdover months rent, P consented to a new lease.

c. Delivery of Possession: Whether the landlord must deliver possession to thetenant after the lease has been executed.

1. Majority (English) Rule: Landlord must give tenant legal right ofpossession and actual possession.

2. Minority (American) Rule: Landlord must give legal right of possessiononly, not actual possession. Holdover tenants are the tenants problem.

i. Ex, See Hanna v Dusch.d. Tenants Possession: Tenant need not take actual possession, but must pay rent.

1. Tenants Remedies (Under American Rule):i. Void Lease

ii. Recover damagesiii. Withhold rent.

e. Landlords Duties v Tenants Duties: Tenants duties to pay rent isINDEPENDENT upon the landlords fulfilling of its obligation to:

1. To provide the legal right to possession.2. Not to interfere with tenants physical possession.3. In most jurisdictions, to confer actual possession to the tenant.

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XVII. SUBLEASES AND ASSIGMENTS:a. Privity of Estate: The right to sue another party for breach of a condition upon which the parties

are bound, which runs with the land.i. Ex. Landlord 1 leases blackacre to tenant 1, with the condition that T1 maintains the

gardens. If T1 assigns to T2, then T2 is also bound to maintain the garden.a. Promises that Run with lease hold land require: (1) Intent, (2) Privity, (3)

Touch and concern (benefit and burden).1. Personal Promises dont run with the land.

b. Privity of Contract: The right to sue another party to the contract for a breach to the conditionsof such contract.

i. Landlord leases to tenant 1, who assigns to tenant 2. Landlord cannot sue tenant 2 forrent, because there is no privity of contract.

c. Assignment: The tenant transfers tenants entire interest under leaseto assignee.i. Privity of Estate: There is privity of estate between landlord and assignee, that is, the

landlord and the assignee can sue each other.ii. Privity of Contract:Privity of contract between landlord and original tenant is not

destroyed. Additionally, the tenant and the assignee can sue each other.iii. Defaults: If the tenant or the assignee defaults, the original landlord can sue both.


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d. Sub Lease:Occurs when the tenant transfers anything less than his entire interest in theleasehold.

i. NO PRIVITY OF CONTRACT OR PRIVITY OF ESTATE BETWEENORIGINAL LANDLORD AND SUB-LEASEE.

a. The original landlord cannot sue the sub lessor nor can the sub lessor sue thelandlord.

e. Distinguishing a Sublease from an Assignment:i. Has the tenant conveyed his entire state to newcomer?

a. Yes: More likely to be an assignment, entire interest was transferred.b. No: If original tenant retained a right of re-entry, more likely to be a sub-lease.

ii. Examine the Parties Intentions:Has original tenant divested from complete interest?a. Ex Ernst v Conditt: P leased property to Rogers, who built a go-cart track

business in it. Rogers sublet the property to D, who wanted to buy Rogersbusiness. D defaulted, and P sued for rent. D contended there was no privity.

1. Held:Because D wanted to buy Rogers business, and Rogers divestedhimself from his complete interest in the property, the transfer at bar is anassignment, despite the term sublease. Thus, P can sue D for rent.

b. Ex Jaber v Miller:Holding that a transfer which was named assignment butwhich reserved right of re-entry to the original tenant if the newcomer defaultedwas in fact a sublease.

iii. Pitfall of Error:a. Double Rent: A transferee who thinks he has a sublease but has an assignment

may have to pay double rent, if and after the original tenant pockets the rent.b. Merger: If a transferor makes profit with the transferees rent, he may lose it if

the court finds that the transfer was an assignment, and thus the transferee is liableto the landlord.

iv. Landlords Power to Deny Assignment or Sublease:a. Express Denial: A landlord can expressly deny transfer of the interest, but such

transfer of the interest is only valid so long as the landlord is alive.b. Limits Landlords Power to Deny Consent:

1. Discrimination:Cannot deny transfer of lease based on invidiousdiscrimination.

2. Implied Duty of Reasonableness:i. A landlord objecting to an assignment or sublease must show that

his objection is commercially reasonable. Kendall v Pestana.ii. A duty to only object to transfers when is reasonable to do so may

also apply to residential contexts. Krieger v Helmsley-Spear.

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XVIII.THE TENANT WHO DEFAULTS (Tenants Duties):a. Pay Rent:

i. Common Law (Independent): Applied a property-like approach, holding that tenantshad an independent obligation to pay regardless of the landlordsbreach.

a. See Brown v Bragg: Holding that the failure to pay rent due, did not work aforfeiture of the estate of the tenant, because rent default will only causeforfeiture if such condition is expressed in the lease, which was not the casebetween the parties here involved.


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b. Modern Approach (Dependent): Applies a contract like approach, holding that the tenantsduty to pay rent is dependent to the landlords fulfillment of its obligations.

c. Tenants Duties:i. Duty to Repair damages beyond Wear and Tear

ii. Duty to avoid damage or waste:a. Damage or waste is defined as anything that negatively changes the

appearance, function, or utility of the property to a substantial extend,

and/or causes substantial and unreasonable expenditures.Pross v ExcelsiorCleaning.

iii. Refrain from using the property for illegal purposes.iv. Refrain from causing a nuisance.

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XIX. LANDLORDS REMEDIES:a. Rent Acceleration: If the tenant defaults on rent payments, the landlord may seek rent

acceleration, defined as rent payable for the balance of the remaining term. The landlord cannotoccupy the property for the remaining segment of the lease.

i. Pre-Paid Rent: If the tenant pre-paid rent, and then breaches or opts to vacate, thelandlord can refuse to reimburse the prepaid rent.

b. Security Deposits: Must be reimbursed to tenant minus any damages beyond normal wear andtear.

c. Liquidated Damages: Will only be enforced if reasonably proportional to damages suffered.d. Eviction (Ejectment):

i. Common Law: Landlord could not evict for default in rent, as landlords duties andtenants duty to pay rent were independent.

ii. Modern Approach: Landlord can evict tenant when tenant defaults. Their obligationsare dependent.

a. Right of Re-Entry: If lease provides that landlord may terminate if tenantdefaults, landlord must exercise right ofre-entry and take substantial steps torecover possessionwithin a reasonable time.

b. Determinable Lease: If Lease provides that tenants default terminates leaseautomatically, the lease is determinable upon payment, and landlord hasautomatic possessory rights upon default.

e. Types of Eviction:i. By judicial Process: If tenant refuses to quit premises, landlord files an unlawful

detainer action, which is heard within five days, and the court authorizes a sheriff to evicttenant. (Favored).

a. Pros:1. Reduces chance of violence.2. Affects credit of bad tenants, thus giving notice to future landlord.

ii. SelfHelp: Take individual action to evict tenant. Must use reasonable force.(Disfavored).

a. Pros:1. Reduces judicial costs.2. Does not affect credit of ejected tenant.

f. Ex. Berg v Wiley: D leased restaurant space to P. P was cited for health codes violations, andreformed the property without Ps consent and in violation of the lease. P changed the locksevicting P. P sued to recover damages.


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i. Held: It is against policy for landlords to take the law into their own hands, especially asself-help may cause violence. Summary Legal proceedings are available that can get thelandlord possession in three to ten days. Thus, self-help is outlawed.

g. Tenants Abandonment and Landlords Duty to Mitigate Damages:i. Common Law Rule: Landlord has no duty to engage in reasonable efforts to obtain a

new tenant after previous lessor defaults, in order to mitigate damages.ii. Modern Rule: Landlord has a duty to reasonably mitigate the damages that result when a

tenant defaults, by searching for another tenant.a. Ex, Sommer v Kridel:P lease an apartment to D. Ds marriage plans collapsed,

and he informed P that he had no use, nor could afford the apartment. P refused torescind the agreement and refused to lease the apartment to other willing tenants.

1. Held: A contract-like approach is adopted. Landlords have a reasonableduty to mitigate, which enhances the use of scarce housing resources.Landlord seeking damages must show an attempt to reasonably mitigate.

XX. LANDLORDS OBLIGATIONS AND TENANTS REMEDIES

a. Summary of Landlord actions and corresponding tenants remedies.

b. Tenants Right to Quiet Enjoyment: A tenant has the right to quiet enjoyment of the property,which precludes the landlord from engaging in any of the evictions listed in the chart.

c. Constructive Eviction: If through the landlords fault, the tenants normal enjoyment of theproperty is substantially interfered, the tenant can argue a constructive eviction occurred, voidthe lease and vacate.

Type Definition Example Remedies

Actual

Eviction

Physical expulsion orexclusion from possessionof entire premises

LL excludes or locks the tenantout of the premises

Terminate lease, stop payingrent and collect damages

Actual

Partial

Eviction

Physical expulsion orexclusion from possession

of part of premises

LL renovates the property andmakes some of leased premises

part of a common area of amulti-unit property (hallway orlobby) and thus, unavailable totenant

Stay in possession and pay norent until possession is restored

Constructive

Eviction

Substantial interferencewith use and enjoyment ofpremises

Premises are rendered unfit forhabitation in whole or in part(lack of heat, power, noisyhalls, rats)

Vacate (option under warrant ofhabitability) after giving LLnotice of disturbance andreasonable opportunity to cure stop paying rent and collectdamages

Constructive

PartialEviction

Only part of the property

is inhabitable but you stayon the good party stillhave to pay rent


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i. Rationale: The landlord has interfered with the tenants enjoyment of the property tosuch extent that he might have evicted the tenant. The following are the required

elements:a. Substantial Interference: The tenants use of enjoyment of the premises must be

substantially interfered.1. Defense: If the tenant knowingly leases a property which visibly shows

conditions that may substantially interfere with tenants enjoyment of theproperty, then landlordmay have a defense of assumption of risk.

b. Tenant must give Notice to landlord.c. Landlords Fault: The instances which substantially interfere with tenants

enjoyment of the property are landlords fault, or fall within the landlords duties.d. TENANT MUST VACATE: Tenant must vacate the premises within a

reasonable time.1. Ex, Reste Corp v Cooper:P leased office space to D. The office space

was prone to flooding, which the first landlord corrected floods when theyoccurred. AfterP became the manager, P did not correct the floods, and Dmoved after the last big flood. D moved out, and P sued for damages.

i. Held: The fact that D did not move immediately after first flooddoes not bar D from suing under constructive eviction. D moved

out within a reasonable time after when P failed to take action.Thus she moved out within a time sufficiently reasonable.

e. Remedy: Tenant can ONLY TERMINATE THE LEASE.d. Constructive Eviction Cases:

i. Stewart v Childs Company:P leased space from D to run a restaurant. The leaseprovided that the basement shall be waterproof and not less than seven feet high.Landlord guarantees that will keep cellar at his own expense. P required cellar to bewaterproof to brew coffee. Soon thereafter there was consistent water in the cellar andbasement.

a. Held: Constructive eviction requires that the landlord acts with the intent ofsubstantially depriving the tenant of the enjoyment of the premises. (SubjectiveIntent). The court was unable to find any such intent from the landlords actions.

ii. Phyfe v Dale:P leased an apartment in a building owned by D. Other tenants in thebuilding engaged in prostitution, drug consumption, and the tenants wife and childrenwas accosted and insulted by other tenants. P moved and sued for damages.

a. Held: Landlords failure to restore order constitutes constructive eviction. Thetenant was justified in moving out because he was not obligated to endure suchconditions. (Applied Objective Reasonable Person Standard).

iii. CAMERON: The two above cases can be reconciled under a transaction costapproach. There were less transaction costs for the tenant in Stewart to change the wholestructure of the basement, than for the tenant to make repairs. On the other hand, there

were less transaction costs for the landlord in Phyfe to restore order than for the tenant todo so.

e. Implied Warranty ofHabitability: Defined as landlords duty to ensure that leased propertiesare in reasonable adequate condition for human habitation. There are two elements:

i. Implied at inception of the lease,ii. Implied continuing duty to repair.

iii. Standard: Usually the housing code of the jurisdiction.f. Rationale of Warranty ofHabitability:

i. Implied warranties of basic qualities are common place in contracts, since leases are partycontracts, they should apply.


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ii. Urban tenants lack skills necessary to detect or repair damages that make propertyinhabitable.

iii. Implied warrants of habitability help equal bargaining power between tenants andlandlords.

iv. Implied warrants will encourage compliance with housing codes.g. Damages available to Tenants for Breach of Warranty ofHabitability:

i. Terminate lease and leave.ii. Stay and withhold rent.

iii. Stay and Repair.iv. Stay and Recover Damages: Difference between the value of the property as promised,

and what was received.v. Recover Punitive Damages.

h. Cases:i. Lemle v Breeden: P leased a summer house in Hawai to D. The house was found to be

infested with rats, to the point that D and Ds family could not sleep. D thus vacated thepremises and refused to pay rent arguing P had breached an implied warranty ofhabitability.

a. Held: D was justified in moving out. D had no way of inspecting the housebecause it was leased at a distance. The doctrine of implied warrant of habitability

allows for greater remedies available, and does not require tenants to vacate.ii. Hilder v St Peter:P leased an apartment from D which had safety hazards, a bathroom

clogged with feces, leaking pipes, and more. P continued to live in the apartment due tonot being able to afford other places, but sued D for breach for breach of impliedhabitability. D argued P continued to live there and was not entitled to compensation.

a. Held: P can recover damages under the implied breach of habitability, which areequal to the difference between the property in habitable conditions and what shereceived. CAMERON: She got what she was paying for, the price was low.

iii. Javins v First National Realty Corporation:Holding that a warranty of habitability isimplied, and that the standard of habitability is that set in the Housing Code of theJurisdiction.

i. Landlords Liability in Tort:i. The landlord may be liable for defect of the property which injure the tenant, especially ifsuch defects arose before the lease commenced, during the tenancy and the landlordrefused to timely correct the problem, or if the defect is in common areas.

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XXI. THE PROBLEM OF AFFORDABLE HOUSING:a. Chicago Board of Realtors v City of Chicago: Criticisms against rent control policies.

i. If price is depressed artificially and/or landlords costs are depressed artificially, then thesupp

prop outline carlos

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