Property Rule Statements PDF

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Property Rule Statements Adverse Possession In order to establish a claim for adverse possession, the claimant must prove that the possession was adverse and hostile, exclusive, open and notorious, actual and continuous for the statutory period. ● Adverse and Hostile: The  claimant’s state of mind is irrelevant, but in a bad faith jurisdiction, the claimant must have known that the property belonged to another and intended to possess it anyway. In a good faith jurisdiction, the claimant must honestly believe that the property was theirs. ● Exclusive: The claimants possession is exclusive when it is not shared with the owner or with the public in general. ● Actual: A claimant’s possession is actual when they physically use the land in the same manner that a reasonable owner would. ● Open and notorious: a claimants possession is open and notorious if it is visible and obvious so that the true owner is put on notice of possession. ● Continuous for the Statutory period: Claimant must use the property as continuously as a reasonable owner would for the length of the statutory period of said jurisdiction. Tacking: The adverse possession periods of two or more successive possessors may be added together to meet the statutory period, as long as the occupants are in privity. Privity is satisfied when the occupant transfers his rights in the property to a successor by deed or by will. Disabilities: The period for adverse possession will be extended due to the rightful owner’s disability. T  he most commonly recognized disabilities are: ● Imprisonment ● Minority ● Lack of mental capacity ● Military service ● Lives outside of the state ○ Death ends all disabilities ○ Disabilities cannot be tacked ○ Disability does not shorten the standard period for adverse possession Finders: There are four types of “found” chattels: ● Lost property: P  roperty is lost when the owner unintentionally and involuntarily parts with it. The finder of lost property has rights superior to all except for the true owner. ● Abandoned property: Property is abandoned when the owner knowingly relinquishes all right, title and interest to it. The finder of abandoned property has rights superior to all.

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 roperty is mislaid when the owner voluntarily puts it in a certain place, but Mislaid property: P unintentionally forgets it. The owner of the location in which the property was found has superior rights to others, including the finder, but not against the true owner. (ex: Owner of store in which a lost wallet is found, has superior rights to the finder but not to the true owner.) ○ Policy rationale: The property theory of personhood is valued because the court values the attachment humans gain to property, so in honor of that, the court would want the property to be returned to its true owner.  ccurs when the owner has conceals property in a hidden location long ago; Treasure Trove: O limited to gold, silver, coins, etc. Most jurisdictions do not recognize treasure trove.

Gifts: a gift is the immediate transfer or personal property made voluntarily and without consideration from the donor (the person giving the gift )to the donee (the person receiving the gift) . ● Inter vivos gift: an inter vivos gift is the usual type of gift made during the donor’s lifetime.The essential elements of an intervivors gift are donative intent, voluntary delivery and acceptance by the recipient. ○ Donative intent: to satisfy the donative intent, the donor must intend to make an immediate transfer or property. ○ Delivery: to satisfy delivery, the property must be delivered to the donee, so that the donor parts with dominion and control. ■ Manual delivery – occurs when the donor physically transfers possession of the item to the donee ■ Constructive delivery – requires that the donor physically transfer to the donee an object that provides access to the gifted item. It is allowed if manual delivery is impracticable or impossible. ■ Symbolic delivery – the donor physically transfers to the done an object that represents or symbolizes the gifted items. ○ Acceptance: to satisfy acceptance, the donee must accept the property, although acceptance of a valuable item is usually presumed. ● Conditional Gifts: an ○ Donative intent ○ Delivery ○ Acceptance ○ Condition must have occurred **In most jurisdictions, death-bed gifts and engagement rings are conditional gifts, unless they are given for some other reason such as a holiday. Ex: If a engagement ring is given on Valentine’s Day or Christmas, it is an inter vivos gift and there is no condition upon marriage. Engagement Rings: ● Fault Approach: the ring is retained by the person not at fault for the breakup ● No-Fault Approach: the ring is returned to the donor no matter whose fault it is

Estates/Future Interest Six Freehold estates: ● Fee simple absolute ● Life estate ● Fee tail ● Fee simple determinable ● Fee simple subject to a condition subsequent ● Fee simple subject to an executory limitation An estate of future interest is usually transferred in one of three ways: deed, will or intestate succession. Transfer by deed: ● A living person may transfer real property by a deed ● The completed transfer is called a conveyance or a grant ● Verbs-- convey or grant ● Person transferring--grantor ● Recipient--grantee Transfer by will: ● The property of a decedent may be transferred by a will ● The completed transfer of real property is called a devise ● Verb--devise ● Person whose will contains the devise-- testator/ testatrix (female) ● Recipient-- devisee Transfer of intestate succession: · If a person dies without a will, property will be distributed according to state statutes, usually to their closest living relatives · The completed transfer is called intestate succession · Verb--descend · Recipient—heir Life Estate · The duration of a life estate is measured by the lifetime of a particular person. When that person dies, the estate terminates. · The holder of a life estate is usually called a life tenant. · A life estate is created by language that clearly indicates this intention, such as "to E for life" o The words "for life" are the traditional words or limitation creating this estate · A life estate can be measured by the life of a person other than the grantee o Pur autre vie (for the life of another) · When an owner in fee simple transfers a life estate, a future interest arises automatically · The future interest that follows a life estate is usually a reversion or a remainder; the distinction turns on who holds the interest

There are three types of restraints: disabling restraints, forfeiture restraints, & promissory restraints · Disabling restraint o A restraint that prevents the transferee from transferring her interest · Forfeiture restraint o A restraint that leads to a forfeiture of title if the transferee attempts to transfer her interest · Promissory restraint o A restraint that stipulates that the transferee promises not to transfer her interest Absolute restraints on a fee simple are void, partial restraints may be valid if they are reasonable as to duration, scope, and purpose. Three kinds of waste: Waste is  defined as an abuse or destructive use of property by one in rightful possession.  esults from an affirmative act that significantly reduces the value of the ● Voluntary waste: R property ● Permissive waste:  Results from failure to take reasonable care to protect the estate  esults from an affirmative act that leads to a substantial change in the ● Ameliorative waste: R property and increases its value Defeasible e state: an estate that may end upon the occurrence of some future event. Fee simple defeasible- a fee simple that may continue forever or may end upon the occurrence or some future event. There are three types: Fee simple determinable ● A fee simple estate that automatically ends when a certain event or condition occurs, giving the right of possession to the transferor. ● Characterized by words of duration, such as: so long as, while, until, during ● The future interest that follows a fee simple determinable is always a p ossibility of reverter ● Freely alienable, devisable and descendible-- durational condition continues to apply to any transferee simple subject to a condition subsequent o Fee simple estate created in a transferee that may be terminated at the election of the transferor when a certain condition or event occurs. This estate does not end automatically the transferor has the power to terminate the estate by taking action. o Characterized by words of condition which expressly allow the estate to be divested upon a specified event such as: provided that, but if, on condition that o A right to entry a lways follows a fee simple subject to condition subsequent · It cannot be created in a transferee o Freely alienable, devisable, and descendible-- the right of entry could not be assigned or devised ·

Fee

· Fee simple subject to an executory limitation o C  reated in a transferee that is followed by a future interest in another transferee. Future interest is held

by a third party o Created by the same words of duration or condition that create the other two fee simple defeasible estate: so long as, while, during, until, provided that, but if, and on condition that o The future interest that follows the fee simple subject to an executory limitation is an executory interest. o Is alienable, devisable, and descendible; any transferee is also subject to the condition Future Interest- an existing, nonpossessory property right that may become possessory in the future. Two groups of interestsa ccording to the identityo f the holder: · Future interest retained by the transferoro Reversion · Goes with life estate and term of years o Possibility of reverter · Tied with determinable o Right of entry · Tied with condition subsequent · Future interests created in a transfereeo Indefeasibly vested remainder o Vested remainder subject to divestment o Vested remainder subject to open o Contingent remainder o Executory interest 1. Future Interests Retained by the Transferor · The reversion, possibility of reverter, and right of entry can only be held by a transferor. o Arises when a transferor conveys an estate to a third party that is smaller than the estate she holds. · Only gives away some sticks of her bundle, not all. Reversion: a transferor retains a reversion when she conveys a smaller vested estate than the one she has. Possibility of Reverter: the possibility of reverter is the future interest retained by the transferor who holds a fee simple absolute, but conveys a fee simple determinable. Right of Entry: the right of entry is the future interest retained by the transferor who holds a fee simple absolute, but conveys a fee simple subject to a condition subsequent · The right of entry does not become possessory until and unless the holder takes affirmative steps to regain possession. A. Remainders A remainder is a future interest in a transferee that: · (1) is capable of becoming possessory immediately upon the expiration of the prior estate

o C  ould happen if the condition is met

to Blue and her heirs if Sir and Rumi don't go into the entertainment industry. They're both in politics. · (2) does not divest (or cut short) any interest in a prior transferee o S  o they would wait for the other's person life estate to end before they step in ·

Ex:

Four remainders: · Indefeasibly vested remainder o A remainder is vested if (1) it is created in an ascertainable person and (2) it is not subject to a condition precedent other than the natural termination of the prior estate. · Vested remainder subject to divestment o A remainder that is vested but is subject to a condition subsequent. · Vested remainder subject to open o A vested remainder held by one or more living members of a group or class that may be enlarged in the future. · Contingent remainder o If a remainder is not vested, it is contingent. o A contingent remainder is a remainder that is either · (1) given to an unascertainable person, or · (2) subject to a condition precedent. B. Executory Interests An executory interest is a future interest in a transferee that must divesta nother estate or interest to become possessory. · This is the opposite of the remainder · If a future interest in a transferee is not a remainder, it is an executory interest

Concurrent Ownership When two people have equal rights to use and enjoy the entire parcel. ● A cotenant in  possession does not owe any rent to a cotenant out of possession, absent an ouster. (Esteves) Tenancies ● Tenancy in Common: a tenancy in common is created when each tenant in common has an undivided, fractional interest in the property and each has the right to use and possess the whole parcel even if his fractional interest is smaller than the interests of others. However, when the property is sold, the proceeds will be divided according to their proportionate shares. (freely alienable, devisable and descendible) ● Joint Tenancy: Joint tenants have an undivided right to use and possess the whole property, but each joint tenant also has a right of survivorship (NOT devisable or descendible). Four unities must exist in order to create a joint tenancy.

1. 2. 3. 4.

Title: title to the property must be acquired in the same instrument Time: The property must be conveyed to the joint tenants at the same time. Interest: Each joint tenant must have the same share size in the property. Possession: Each joint tenant must have equal right to possess, use, and enjoy the whole property

Severance: A joint tenant may, in his lifetime, grant certain rights in the joint property without severing the tenancy. But, when a joint tenant dies, his interest dies with him and and any encumbrances placed by him on the property becomes unenforceable against the surviving joint tenant. ● Tenancy by the Entirety: tenancy by the entirety is only held by married couples. Each tenant has an undivided right to use and possess the whole property and a right of survivorship. The tenancy by entirety can only be ended by death, divorce or the agreement of both spouses. Partition: any tenant in common or joint tenant has the right to sue for partition of the property. A partition judgement ends the co-tenancy and distributes its assets. ●

in a partition proceeding in which a party opposes the sale of property, the economic value of the property is not the exclusive test for deciding whether to partition in kind or by sale.

Marital Property ● Community Property System: During the marriage, all earnings and assets acquired from those earnings are owned by both spouses equally. Marriage is a partnership in which each spouse holds an equal, undivided share in the community property, neither spouse has a right of survivorship. ● Separate Property System: This system divides property rights into 3 categories: right during the marriage, at divorce and at death. ○ During the marriage: The spouse who acquires the property owns his property separately. ○ At Divorce: Most states require equitable division of the property owned by each spouse. Courts divide the property in a just and fair manner. ○ At Death: The surviving spouse gets a forced share of the decedent’s share. Leasing Real Property Term of years tenancy: A term of years tenancy has a fixed duration that is agreed upon in advance. One the term ends, the tenant’s possessory right automatically expires and the landlord may retake possession of the premises.

Periodic tenancy: A periodic tenancy is automatically renewed for successive periods unless the landlord or tenant terminates the tenancy by giving advance notice. Tenancy at will: A tenancy at will has no fixed ending point, it continues so long as both the landlord and the tenant desire. However, the tenancy terminates automatically if either part dies, the tenant abandons possession, or the landlord sells the property. (Requires notice) Tenancy at sufferance: A tenancy at sufferance is created when a person who rightfully took possession of land continues in possession after that right ends, becoming a “holdover tenant.” In this instance, a landlord has two options: to treat the tenant as a trespasser and evict him or renew the tenancy for another term. Constructive Eviction: In order to claim constructive eviction, the tenant must prove 1) wrongful conduct 2) by the landlord that 3) substantially interferes with the tenant’s use and enjoyment of the property. The landlord must have violated the implied warranty of quiet use and enjoyment for a tenant to claim constructive eviction. Implied Warranty of Quiet Enjoyment is a promise by the landlord that she would not wrongfully interfere with the tenant’s possession. A tenant seeking constructive eviction must notify the landlord about the problem, give the landlord a reasonable period to cure it before vacating the premises and withholding rent. Implied Warranty of Habitability (protects the tenant from defective housing conditions) The landlord of a property has a duty to maintain bare living requirements by complying with building and housing code standards. Tenant’s obligation to pay rent is contingent upon the landlord fulfilling his duty to maintain a habitable premises. The tenant must notify the landlord of the defects and allow the landlord a reasonable time to cure the defect; however, the tenant is not required to vacate the premises. Sommer v. Kridel– a landlord has a duty to mitigate damages where he seeks to recover rents due from a defaulting tenant. The landlord must make reasonable efforts to re-let the apartments. Factors to consider this is whether the landlord 1) either personally or through an agency, offered or showed the apartment to any prospective tenants or advertised it in local newspapers.

An assignment conveys the whole term, leaving no interest nor reversionary interest in the grantor or assignor. A sublease may be generally defined as a transaction whereby a tenant grants an interest in the leased premises less than his own, or reserves to himself a reversionary interest in the term. In construing deeds and other written instruments, look to ascertain the intention of the parties to determine if a assignment or sublease has been created.

Ending the tenancy: Surrender is when both parties mutually agree to terminate the lease early. Abandonment: an abandonment of the leased property by the tenant occurs when he vacates the leased property without justification and without any present intention of returning and he defaults in the payment of the rent. If the tenant abandons the leased premises before the lease term ends, the landlord could choose among three options: (1) sue for rent, (2) terminate the lease, (3) mitigate damages and then sue for rent. Eviction: Hillview Associates: A  landlord shall not retaliate by increasing rent or decreasing services or by bringing or threatening to bring an action for possession or by failing to renew a rental agreement. Berg v. Wiley:  A landlord may rightfully use self-help to retake leased premises from a tenant in possession without incurring liability for wrongful eviction provided two conditions are met: 1) the landlord is legally entitled to possession, and 2) the landlord’s means of reentry are peaceable. Selling Real Property Statute of Frauds: as a general rule, an oral agreement for the sale of an interest in real property is not enforceable. To satisfy the Statute of Frauds, there must be writing which contains the essential terms, and signed by the person being bound. ● There are two exceptions to Statute of Frauds, equitable estoppel and partial performance. An equitable estoppel is a reasonable reliance that changes the position of the relying party or causes a serious injury. Marketable Title: a title is marketable if the seller’s property interest is what she purports to sell, there are no encumbrances and no zoning violations.

Encumbrance: A claim o...