Essentials Of Business Law
Chapter 21
Real And Personal Property
McGraw-Hill/Irwin
Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.
Types Of Property
Real property
 Land and everything attached to the land
• Minerals
• Permanent additions to the land
Personal property
 Includes all property, other than real property
 Tangible
• Furniture, clothing, books
 Intangible
• Patents, copyrights, goodwill, trademarks, service marks
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Acquiring Title To
Personal Property
Title is the actual ownership of property
 Can be transferred from one person to another
Finding lost personal property
 Finder has a legal responsibility to make reasonable
efforts to return the property
Abandoned property
 Title is transferred to the first person who takes
control over it
Accession
 The right of an owner of property to any increase in
the property
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Acquiring Title To
Personal Property
Gifts
 The voluntary transfer of property by one person to
another without consideration or payment
Three requirements for gifts:
 The donor must intend to make a gift
 The gift must actually be delivered to the donee
 The donee must accept the gift
Inter vivos gift
 Property given while both parties are alive
Gift in causa mortis
 Property given by a living person who expects to die
from a known cause
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Ownership Of Property
Severalty ownership
 All the rights of ownership in a particular piece of
property are held by one person
Multiple ownership
 Joint tenancy
• Two or more persons own equal shares of property
• Right of survivorship
 Tenancy by the entirety
• Joint ownership of property by husband and wife in which
both have the right to the entire property
• Right of survivorship
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Ownership Of Property
Multiple ownership
 Tenancy in common
• Joint ownership of property by two or more
persons
• Ownership interest of any one of the owners can
be sold, transferred, or inherited
• Ownership is passed to that person’s heirs
 Community property
• Property acquired by either one of the spouses
during a marriage is belongs to both parties
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Real Property
Land
 Rights to land include:
• Airspace above the land
• Minerals
Buildings
 Structure permanently placed or constructed on or
beneath the surface of the land
Fixtures
 Personal property added to land or to buildings so
that they become a part of the structure
• Planted shrubbery, trees, satellite dishes
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Other Rights In Land
Subterranean rights
 The right to extract minerals
Air rights
 The right to build on or over the land
Easements
 A right or interest in land granted to a party to make
beneficial use of the land owned by another
 Cannot be sold or transferred once they are recorded
Licenses
 Granting a party the right to enter the land for a
specific purpose
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Ownership Interests In
Real Property
Freehold estate
 A person owns the land either for life or forever
 Fee simple
• The owner of a freehold estate who holds it absolutely
 Life estate
• A person who holds a freehold estate only for his or her
lifetime
Leasehold estate
 A person has an interest in real property that comes
from a lease
 Right of possession, but not ownership
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Transfer Of Real Property
Deed
 The instrument that conveys an interest in real
property between parties
Grantor
 The party who conveys real property
Grantee
 The party to whom the real property is conveyed
Consideration is not required in the transfer of
real property
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Deeds
Quitclaim deed
 Transfers whatever interest a grantor has in real
property, if any
 Used to resolve questions of full title
 Do not warrant good title
Warranty deed
 Grantor asserts that he or she has title, and that the
property is free of the claims of others
Bargain and sale deed
 States that grantor is transferring the real property to
the grantee
 No particular warranties are given
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Other Transfers Of Real
Property
Eminent domain
 Real property is taken from an owner by action of
government for the benefit of the public
 Compensation is made at the fair market value
Adverse possession
 Title to land is acquired as a result of a person’s use
of land over a period of time
 Proof of actual and exclusive continuous possession
 Possession must have been open and known to the
owner, and with hostility and adversely
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