REAL PROPERTY
DEAN DEUTCH
I.
FALL 2001
ASPECTS OF PROPERTY RIGHTS AND CLAIMS
- Property;
- A person has a property interest if he has any right w/regard to something the law
will protect against infringement by others
- Real: land and any structures on it
- Personal: all other types
*Property rights serve human value. (Human rights prevail over Property rights)
*Supremacy clause: Federal law supercedes state law; a state cannot interfere with the
applicability of federal law.
- Possession v. Title
- Possession: have dominion and control over land or personal property (no title
necessary)
- Title: “ownership” (i.e. tenant in apt has possession of it but landlord has title)
- Rights in land derive from government and are then transferred to others.
- Government has often distributed property based on possession even when possessors
violate prior law.
- Actual possession of a contested resource often creates a presumption of a right to
possess that may be rebutted only by evidence of a superior claim
A. Public Rights of Access and the Right to Exclude
Right to Use: not absolute – court balances if individual right to control your property
outweighs right of others to it or other’s harm
Right to Exclude – depends on who/what (is it essential?)/why excluded (no absolute right to
exclude)
*Right to exclusive possession
a. Why should there be a right to exclude?
1) Self-fulfillment: use property as we chose
2) Cost to owner: burden on owner to have to prove that the reason for excluding is
legitimate
3) Market will solve (market theory): if one person excludes, another will benefit
from excluded person’s business
- Questionable that money should be made from discrimination
(a) Creates stereotypes – stereotypes harmful b/c the stronger they are, the
harder on market b/c we hurt market efficiency
(b) Hurts profits
(c) Pain of exclusion – people excluded are hurt
PUBLIC RIGHTS OF ACCESS TO PROPERTY:
RULES LIMITING THE RIGHT TO EXCLUDE NONOWNERS
State v. Shack
- Tejeras and Shack entered upon private property against the orders of the
owners of that property, to aid migrant farm-workers employed and housed
there
- RULE: real property rights are not absolute; and “necessity, private or
public, may justify entry upon the lands of another – this rule is based upon
the basic rationale that “property rights serve human values” (i.e. First
Amendment Right to Freedom on Speech)
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REAL PROPERTY
DEAN DEUTCH
FALL 2001
-
This case illustrates the central limitation on the right to possession or use of
private property (i.e. it may not be used to harm others)
*Employer, property owner, does however have a right to require guests to
identify themselves and state the purpose of the visit.
*Supremacy clause: Federal law supercedes state law.
-The rights granted in the Constitution are not that extensive; a person
needs positive law created by a state to further protect their rights.
b. Place that invites public necessarily limits its rights to exclude people
- Court’s worried about subtle discrimination in public places.
c. Right to distribute materials on another’s land
- Right to exclude depends on who you are (can’t exclude if an innkeeper or
common carrier and how essential what it is people want to distribute on the
land to those who may receive it)
- 3 options:
(a) Free speech trumps property rights (not according to Lloyd)
(b) Property rights trump free speech (Ds in Pruneyard)
(c) US constitution doesn’t require either, it’s up to the individual states
(Pruneyard)
FREE SPEECH RIGHTS OF ACCESS TO PRIVATE PROPERTY:
UNITED STATES CONSTITUTION: THE FIRST AMENDMENT
- Lloyd Corp v. Tanner
- Tanner distributed political handbills in the interior of a privately owned mall
- RULE: a privately held shopping center is not so dedicated to public use as to allow
private parties the right to exercise their 1st amend rights on its premises.
*Private property owners can define the invitation that is given to the public.
- The 1st amendment is a prohibition on state action only
- The mall is not the functional equivalent of a municipal use b/c it services are not so
broad to simulate the function of a city government (as in Marsh v. Alabama where
Marsh was a town wholly owned by a private company)
STATE CONSTITUTIONS: THE RIGHT TO SPEAK FREELY
- NJ Coalition v. JMB Realty Corp
- JMB, which owns several private indoor malls, banned the Coalition from passing out
political leaflets in its malls.
- RULE: (based on State v. Schmid)
- Speech rights on private property depends on the nature of the use of the property,
- The extent of the public invitation to use that property, and
- The purpose of the speech activity in relation to the use of the property
- Malls replace downtown retail and social centers (aka publc centers)
- Free Speech (based on Marsh v. Alabama) “shopping centers = downtown district.
Districts and private owners cannot interfere w/ exercise of free speech.”
- Expressional rights = private property rights.
- Mass communication.
*Malls have a general invitation.
-
Pruneyard – case where US Supreme Court decided that each state can decide whether or not
it wanted to allow the right to access.
-
Mohn v. Martz Mountain Industries (Mill Creek)
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DEAN DEUTCH
FALL 2001
d. Federal v. State property laws
- Federal constitutional protection of property rights distinct from property
rights in state statutes or common law
- Federal constitutional law defines minimum level of protection for property
rights that the states may not infringe
- As long as state’s don’t deprive citizens of core property interests protected
by constitution, they are free to define and restrict property rights
e. Labor organizations
- Federal statues provide some rights of access for free speech purposes (e.g.
to picket)
B. The Legitimacy of the Property System
-
-
-
-
No property right is absolute – each is limited by rights of others
Positivists: identify law w/the commands of the sovereign (the rules promulgated by
authoritative government officials for reasons of public policy
- Rules may be intended either to protect individual rights, promote the general
welfare, increase social wealth, or maximize social utility
- Separate law and morals
- Emphasize that moral judgements may underlie rules of law (they’re not fully or
consistently enforced by legal sanctions
Legal realists: (Llewellyn) – identify the rules of law that have been explicitly or
implicitly adopted by authoritative lawmakers and apply them as they were intended to
be applied and have been applied in practice
Normative law: what it should be
Positive law:
- Some rules can be both normative and positive – i.e. expectations that come from fact
law exists.
Law of discovery: discoverer has prior right to any subsequent discoverer to deal
w/Indian tribes (1st in time, 1st in right)
Law of conquest: you have control over inhabitants, can assimilate or separate them
Quiet title: declare property yours
- Says there’s no other valid title to property
- Clears up cloud on title (when you’re not sure who owns it)
1. Property rights:
a. Liberty to Use
b. Right to Exclude – power to exclude nonowners from the property; also includes the
power to grant access to others and to revoke that privilege
-Mistaken improver
-Civil rights laws; re: discrimination of race, ethnic origin, religion, etc.
-Common Law
-Shopping centers
c. Right to Use – build, get minerals, use natural environment/farm – right to use your
property as you see fit so long as you do not use it in a way that violates the rights of
others
d. Power to Transfer – alienate (power to transfer while you are alive) – right to
determine when and to whom to see or give their property
-Restrictions on transfer; imposed by former owner may be held void under the rule
prohibiting restraints on alienation.
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DEAN DEUTCH
FALL 2001
e. Power to devise/bequeath, inherit (language used after your death) – right to leave
property to whomever you wish when you die, subject to inheritance taxes
f. Immunity from damage – right not to have property damaged by others
g. Immunity from expropriation – right to prevent others from taking their property
against their will
h. Right to income – investment-backed expectations
i. Right to privacy
j. Right to free speech/association – you can talk about anything you want in your
house
k. Right to security
2. Theories of property: how do you get it?
a. First possession – use the land (Locke: first possession means cultivating the land)
b. Labor theory – work on the land
c. Positivist theory – law as proclaimed
d. Rights theories – ideas that there are some inherent that allow them to own land;
individual rights
e. Consequentialist theories (utilitarian, etc) – property rights exist b/c they are the
best way to maximize the wealth of society
f. Social relations theories – property rights grow out of and define personal
relationships
- Involves legal protection for a particular interest
- Acquired by conquest, govt. grant, purchase, through family relationships, by
investment of labor or money, and by possession
CONQUEST AND GOVERNMENT DISTRIBUTION OF LAND
PROPERTY RIGHTS DERIVED FROM COMPETING SOVEREIGNS
- Johnson v. M’Intosh
- Native American concept of ownership/dominion – Discovery of America
- Title of all land transferred from American Indian nations to Colonies, then to US
- Court held: D derived legal title directly from US, since US conquered all Indians by
taking away their sovereignty; D has superior title
FORCED SEIZURES OF PROPERTY FROM AMERICAN INDIAN NATIONS
- Tee-Hit-Ton Indians v. US (Native American right of occupancy)
- Right to occupancy and use at the will of the US government.
- Right can be extinguished at any time w/no compensation by an act of Congress.
- Court held: Although not recognized as having title or ownership, Indian tribes
have a right of occupancy of their land. This right bas been granted by, and remains
subject to the control of Congress. (Congress has duty to protect Native American
lands).
AMERICAN INDIAN CULTURAL OBJECTS:
TRIBAL PROPERTY OR “FINDERS KEEPERS”?
Charrier v. Bell (American Indian cultural objects)
- Artifacts weren’t abandoned, but buried for religious reasons.
- Native Americans do have property rights (to personal objects, but not land yet)
- Ct held: artifacts belong to the Indians.
*Treasure trove, found items (i.e. gold/silver), does not include objects buried with the
dead, does not belong to the finder.
- Notes:
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REAL PROPERTY
DEAN DEUTCH
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-
-
3 categories of found objects: (law of lost goods)
(1) Lost: owner accidentally misplaced it – had intent to hold onto lost property
(2) Mislaid: owner intentionally left it somewhere and forgot where
(3) Abandoned: owner doesn’t want it anymore, intends to leave it, property
goes to finder (except if on private property)
Passage of time sometimes = abandoned
3. Conflicts between true owner and finder
- Finder of lost or mislaid property doesn’t acquire title to it against true owner.
- True owner has right to recover lost property from finder
- If you find a wallet on your property, inly yours if left by a trespasser
- Finder has a right to keep property that was abandoned since original owner
relinquished rights
4. Conflicts between finder and 3rd parties
- Finder has right to prevail over everyone but true owners.
5. Conflicts between finder and owner of premises where property was found
- Objects belong to owner of property if finder was trespassing.
- If finder was an invitee on property w/landowner’s permission, Cts are divided.
6. Unjust enrichment
- Enrichment that’s unjust w/no justification and no other remedy available
- Inequitable to allow one to be enriched by the labor and expenditures of another who
acted in good faith and in ignorance of any adverse claim or title.
- Elements:
- Someone has to be enriched
- Someone has to have been impoverished
- Connection between enrichment and impoverishment
- There must be an absence of justification or cause for the enrichment and
impoverishment
- No other remedy at law available to Plntf.
7. Bona fide purchaser theory (you can only convey what you own)
a. Bona fide purchaser: thinks what he is buying isn’t stolen
- One who obtains stolen items from a thief never obtains title to or right to
possession of them.
C. Labor, Investment and Possession
1. Wild Animals
a. Justinian’s Institutes: animal is yours when completely under your control (captured)
because it’s unable to recover its natural liberty
b. Theories of ownership:
1) possession (killing)
2) mortal wound and continuing chase
3) catching w/o killing it
4) pursuit (time/distance)
5) pursuit w/specific weapons
6) pursuit w/reasonable probability of success
- e.g. a property owner has “temporary title” (ownership) over ducks on his
land that a neighbor can’t interfere with
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DEAN DEUTCH
FALL 2001
RULE OF CAPTURE
*A person who first captures resources is entitled to the resources. Another way of putting this rule is:
Whoever is prior in time wins. This rule has been applied to many different kinds of resources.
Trespass: an unlawful act committed against the person or property of another; wrongful entry on
another’s property.
Pierson v. Post
- ISSUE: Does a person who is pursuing a wild animal acquire a right to that animal
by the mere fact of pursuit? NO
- RULE: mere pursuit (even accompanied by wounding) of an animal only gives 1st
opportunity to take it but no legal right to it unless animal is actually taken
- POLICY: more certainty/less ambiguity in this rule than if court used labor theory
b/c labor would be difficult to prove (such as what constitutes a chase)
- The "first to pursue rule" contains too much uncertainty. The better rule is the
"first to kill and capture."
*Trespassers can’t claim title. You cannot go on someone’s property and chase their
domesticated animal, but you can go onto someone’s land if you are continuing the chase,
and the game goes onto private land.
2. Rights of possessors
a. When a person has gained possession of a wild animal, he has rights in that animal
superior to the rest of the world (capture sufficient)
1) Chasing: mere fact one has spotted and chased an animal not sufficient (Pierson)
2) Trapping and wounding: mortally wounding or capturing in trap sufficient for
possession but capture must be virtually complete to find possession
3) Custom: looked at if close chase (i.e. dissent in Pierson looks to sportsmen
custom)
b. Finder of lost article (gaining title by possession)
1) “Held in trust for true owner” but trust has statute of limitations at the end of
which the true owner can no longer recover the property from the finder, BUT
the time does not start to run until the true owner knows or with reasonable
diligence should know the possessor’s identity
2) Acquisition of property –
a. Physical control over the goods, and
b. An intent to assume dominion over them
3) Adverse possession
3. Oil and gas rights (three kinds of rights)
a. Landowner has absolute title of minerals in her ground (Texas)
1) Subject to: Policy regulations (e.g. the spacing of the wells)
2) Law of capture: you have the right to bring up to the service any oil and gas
from your property and then you own it (BUT directly contradicts absolute title)
Eliff v. Texon Drilling
- D’s negligent drilling caused gas to escape into air from under P’s land (from well
blowing out)
- D couldn’t use law of capture b/c D was negligent
- Ds had a right to drill, but not negligently or to waste, so Ps had absolute title
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REAL PROPERTY
DEAN DEUTCH
Groundwater
approach to
ownership
1 Reasonable
2 Correlative
3 Prior
appropriation
FALL 2001
4. Water rights
a. Ground water
1) In aquifers: underlie land
- Owner w/draws water (may come from another’s property)
2) Absolute ownership (free use)
- Each surface owner can w/draw as much water from his property as wanted
w/o liability to other owners
- Exception: can’t w/draw water in way that wastes it
3) Reasonable use
- Each owner must accommodate interests of neighboring owners (cts balance
interests of parties)
- What’s reasonable?
- Benefits society (i.e. $ brought in)
- But $ can’t include all of the ways we value something
4) Correlative rights
- Each owner can w/draw a specified portion of groundwater
- Possibly in proportion to percentage of aquifer on or under their land
5) Prior appropriation
- Grants rights to property owner who 1st invested in w/drawing water
- i.e. whoever used it first has right to that amt and the others can only use
left over amount. Subsequent users rights are subordinate to claims
before them (essentially, the Law of Capture).
- *Majority use in arid western states.
6) Permit system
- Used by other states
- State organizations give permits to a defined amount of water.
b. Surface water for streams
1) Riparian rights doctrine
*The rule that owners of land bordering on a waterway have equal rights to use the
water passing through or by their property.
- Property borders on streams have right to make use of that water.
*When a riparian owner’s rights interferes with other riparian owners rights, a
lawsuit arises whereby courts utilize the Reasonable use test.
2) Reasonable use test (used by majority)
- Decision-maker considers and balances factors such as relative social value
of each owner’s use, extent of harm to D, and the cost of preventing the harm
relative to the benefit
- May mean comparing relative utility of the competing uses and choosing
most valuable one to society or apportioning the use so that all riparian
owners have the right to some portion of the water
- **If a downstream owner is not harmed, he cannot enjoin the upstream
owner’s use.
3) Prior appropriation test (used by minority)
- 1st user or developer prevails over a later user
- Allows prior owners to prevail against later users whose riparian activity
harms their interests in access to water
4) State water management systems
- Statutes require permits for use of water
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REAL PROPERTY
DEAN DEUTCH
FALL 2001
NEWS
UNFAIR COMPETITION
5. Copyright
International News Service v. Associated Press
- FACTS: AP and INS are competitors in news industry. INS obtained news AP had
gathered and labored for. “INS reaped where it had not sown.” The value of the
news service depends on the promptness of transmission
- *Value in news is labor that goes into it and spreading it while fresh.
- **Gathering info (labor) = Quasi-property rights.
- ISSUES:
- Is there any property right in news? Yes
- Does the process of gathering information create quasi property rights in that
information? Yes (even after 1st publication, property rights still exist.)
- Does INS’s actions, of copying /gathering and not accrediting original source
constitute unfair competition in trade? Yes
- RULE:
- The process of gathering information creates quasi property rights in that
information.
- Passing of news gathered by another as one’s own constitutes unfair competition
in trade
- Unfair competition = fraud + illegal act
*Fair Use Doctrine: If you attribute it to the person, and give it the proper
documentation, then you can use a certain amount of something (i.e. a minute worth of
actual running time).
6. Human Cells
- No property right in our tissue cells exists
- Can’t sell organs
Moore v. Regents of the U of CA
“Finders keepers, losers weepers”
- Surgeon removed P’s spleen and used cells from it for research purposes then
made and patented a cell line from it
- Ct held: P had no expectation to retain possession/property right in his cells, so
there was no conversion (depriving owner of property w/out his permission and
w/out just cause) by D
- Dissent: person has property right in own body and its products; continuing
ownership even when not connected to body
- Public Policy: information obtained from cells may aid society
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REAL PROPERTY
DEAN DEUTCH
FALL 2001
D. Adverse Possession
*Adverse possession is a means of acquiring title to property by long, uninterrupted possession.
- POLICY:
- Why do we have it?
- Encourage use of land (rather than having owners do nothing with their land);
- Economic Development
- Redistribution of land
- Punish lack of diligence: if you don’t use your land, then we’re going to punish
you for it – since we identify ourselves w/our land, we should be using it and if
we don’t, we should be punished for not using it – to prevent this punishment,
have people (your lawyer, manager, yourself, etc) periodically go and check the
land and make sure no one is using it
- Doctrine of repose: grant clear title to others.
-
-
Should the adverse possessor be required to pay the original owner?
- Most states say no duty to compensate the original owner
- Few states require the adverse possessor to pay
You can’t get adverse possession against a future interest (if A owns the land and
you are the adverse possessor, and B is the future owner and A dies, you don’t get the
time you spent on the land while A was alive. Your time starts over when B takes
over the land.
-
If proven adverse possession:
- Possessor only gets that portion of the property she “actually occupied” UNLESS
possessor has color of title and gets it all
*Color of Title: Adverse possessor holds the land believing he is its owner due to a
defective court decree of judgment or written instrument, which seems to convey title but
is actually defective.
-
Those who occupy the land have the right to exclude others:
- One who wrongfully but peaceably possesses property has right to exclude
- Only true owner has right to dispossess an existing possessor
-
Possessor’s use privileged
Title owner’s use unprivileged
- Burden of proof for Adverse Possession
*P (the adverse possessor) has this burden in almost every state regardless of who brought the
suit.
-Standard of Proof
(1) Clear and convincing – stricter that #2; most states require this standard.
(2) Preponderance of evidence – 50%+
Elements of Adverse Possession
1. Statutory Period
2. Actual
3. *In some states – payment of Taxes (i.e. California)
4. Exclusive
5. Continuous
6. Hostile/Adverse
7. Open and Notorious
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SAT ECHO
REAL PROPERTY
DEAN DEUTCH
FALL 2001
Elements of Adverse Possession (Deutsch has 7)
1. Statutory Period
- Time you need to satisfy Adverse Possession
- Statute of limitations runs as soon as true owner knows or should’ve known have
known about AP
- After statutory period ends, owner loses right to sue adverse possessor to obtain
damages for trespass
- Many states toll statute of limitations.
- A statute that interrupts the running of a S/O/L in certain situations
- If true owner under a disability such as infancy, insanity, or incompetence
or imprisoned or is absent from state.
- Common Law; 21 years for Adverse Possession (some states 30-60 years)
- Current; 30-60 years for AP and some as short as 5 years for AP
- Tenants cannot adversely possess
Brown v. Gobble: parties disputed over ownership of a two-foot-wide tract of property on the
boundaries of their two properties;
Ct held that the doctrine of tacking allows parties claiming adverse possession to use their
predecessors’ conduct on the property to meet the time requirements of adverse possession.
Community Feed Store v. Northeastern Culvert Corp.: Gravel roadway used as loading zone.
Action brought for AP. Ct held that all elements of AP not satisfied. Prescriptive Easement
granted.
2. Actual Possession
Actual Possession; the ordinary use to which the land is capable and such as an owner would
make of it.
- General ownership
- i.e. enclosing property or mistakenly accepting a defective deed.
- Limited Use
- [Prescriptive] Easement: limited rights to use property of another.
- Affirmative Easement: a right to do something specific on the land of
another.
*May be acquired through prescription.
*Don’t need actual possession, exclusive use, or hostility.
- Negative Easement: rights to limit or control the use of neighboring
property.
- Can’t get AP against government
- Usually re: rights of way
3. Taxes
- Some states require payment of taxes for Adverse Possession.
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4. Exclusive
- The use is of a type that would be expected of a true owner of the land in question
and that the adverse claimant’s possession cannot be shared with the true owner.
- Use was personal rather than shared generally by the public.
- Use that would be expected of a true owner of the land in question and that the
adverse claimant’s possession cannot be shared w/the true owner
- May require showing true owner has been effectively excluded (occasional entry by
true owner may not defeat AP)
- Two adverse possessors who possess property jointly may acquire joint ownership
rights as co-owners (tenants in common)
5. Continuous
- Adverse possessor must exercise control over the property in ways customarily
pursued by owners of that type of property
- Tacking – succeeding periods of possession by different people added together
(i.e. if someone possesses property for less than the statutory period)
- Makes sense in terms of efficiency
- Most states require that successors can add the original adverse possessor’s
holding period only if they are in privity w/one another (i.e. original adverse
possessor transferred title of the property to the successor (or purported to do
so))
- If adverse possessor A on land for 5 years and sells to B and they are there
for five years, B has 10 years of time b/c privity exists between A and B
- If B intimidates adverse possessor off land, B’s clock starts over
- B also gets time of his agents – so if in first example, B was there for 2 years
and leased for 3, B still has 10 years
- Forceful transferee’s can’t tack – if successor dispossessed the prior
adverse possessor, he can’t get benefit of tacking doctrine
6. Hostile/Adverse
- Adverse possessor’s state of mind. Three tests:
- Objective test: the possessor’s state of mind is irrelevant.
- Lack of permission; the possession is without the true owner’s permission.
- Claim of title; a possessor’s intention to appropriate and use the land as his
own to the exclusion of all others.
*In the absence of a clear revocation of permission by the true owner or a
clear ouster by the adverse possession claim notwithstanding the duration of
the occupancy by the nonowner.
*Use that starts off as permissive can’t become adverse w/o either an explicit
revocation of permission by true owner or an explicit statement of intentional
oust.
*W/out clear revocation of permission by true owner or a clear ouster by
adverse possessor, initial permission constitutes an absolute defense to AP
claim
*Some states allow non-owner to get prescriptive rights despite initial
permission (interpret true owner’s conduct to imply a revocation of
permission)
*True owner may be estopped from asserting ownership claim if he
acquiesced in long-standing use by a non-owner and non-owner reasonably
relied on continued right of access
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-
Subjective test: the availability of the claim rests partly on the adverse possessor’s
state of mind –her knowledge and intentions regarding the property.
- Intentional dispossession; the adverse possessor must be aware that she is
occupying property owned by someone else and must intend to oust or dispossess
the true owner.
- Mistaken occupation of land can’t give rise to adverse possession
- Policy problem b/c rewards those who know they’re doing wrong
- Good faith; only innocent possessors, those who mistakenly occupy property
owned by someone else, can acquire ownership by adverse possession.
- Mistakenly occupies another’s property
- Claim of title: expresses the necessary adversity
- Color of title: means the claim is based on a written instrument or
judgment that is defective.
- Satisfies the adversity requirement, but usually is ot required for
adverse possession.
-
What if possessor offers to buy land?
(1) Objective test –acknowledgment of owner breaks adverse possession
(2) Subjective test – acknowledgment of owner it eliminates claim of AP
(3) BOTH (Objective and Subjective tests) show courts don’t want known
trespassers to profit
(4) Often even if test is objective, courts will manipulate other elements to prevent
the adverse possession
-
True owner’s state of mind usually presumed to be non-permissive
When true owner told possessor to get off property, possessor is effectively ousted
and any subsequent possession is clearly adverse
True owner can protect his rights by giving permission so non-owner’s possession
isn’t adverse so can’t get AP
Co-owners of property can’t get AP against each other w/o an explicit ouster (i.e.
make statement of intent to take possession of entire property by AP)
-
7. Open and Notorious
Possessory acts must be sufficiently visible and obvious to put a reasonable owner on
notice that her property is being occupied by a nonowner with the intent of claiming
possessory rights. (i.e. building or planting)
- Notorious, a less physical way, also insinuates that others know that you are on the
land.
- Possessor doesn’t need to show true owner observed or knew about adverse
possession.
Nome 2000 – Fagerstroms used a parcel of land owned by Nome 2000 for various
purposes from 1944 to 1987 but did not build a house on it until 1978; Ct. held that
whether a claimant’s physical acts upon the land of another are sufficiently continuous,
notorious and exclusive does not necessarily depend on the existence of significant
improvements, substantial activity, or absolute exclusivity; use consistent with the use by
any similarly situated owner is sufficient to establish claim by adverse possession
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J & M Land Company v. First Union National Bank
Dispute over back rent for billboard placed upon D’s land – P claims AP and wants to
choose which statute to apply; Ct. held question of applicable statute is a matter of law
and not a matter for individual parties to decide
*Two types of statute of limitations:
1. Substantive; governs an area not covered by law.
2. Procedural; setting rules establishing remedies where the common law
has already set the rules/law.
E. Nuisance
1. Definition: an unprivileged interference w/ a person’s use and enjoyment of her land
a. P can only sue for nuisance if he has an interest in the effected land – an abnormally
sensitive P can’t recover if normal person wouldn’t find it a nuisance
b. Interest being protected in the right to quiet enjoyment of land (not right to exclusive
possession)
c. Protection of this interest isn’t absolute b/c the harm must be substantial and the
interference deemed unreasonable before a nuisance will be found
d. Look at harm to P and whether conduct/act is reasonable for social welfare
(cost/benefit analysis)
2. Elements:
a. Gravity of harm
b. Utility of conduct
c. Priority of occupation (who was there first)
*Intentional conduct that is unreasonable and causes substantial harm to the use and
enjoyment of land (real property)
3. Types of nuisances:
a. Public nuisance – can get an injunction for this – can be enjoined by public officials
1) Affects the general public or a large group of people
2) Exists by statute:
a) Usually suit is filed by State’s Attorney’s office
b) Can be filed by private person if they can show their injury is different from
the injury suffered by the general public
b. Private nuisance – can get damages – conduct that causes substantial interference w/
the private use of land & is either Intentional-and-Unreasonable or Unintentional-butNegligent use of the land.
1) Interference of a small number of people by a neighbor
2) Exists through common law
c. Nuisance per se – a nuisance existing regardless of location or circumstances of use
e.g. leaky nuclear waste storage facility/slaughterhouse/funeral parlor in
residential place – a matter of law – only for the judge to decide
d. Nuisance in fact – (nuisance per accidents) an activity that is unreasonable under the
particular facts (i.e. it can be legally operated in this area, but what are the
extenuating facts)
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4. Nuisance vs. trespass and negligence
a. Trespass: physical invasion of someone’s property;
b. Negligence: use of one’s own land that intereferes with neighbors use and enjoyment
of their property –lack of care
*Nuisance focuses on the result of conduct rather than conduct itself.
-Prohibits unreasonable conduct, but when the conduct cannot be reasonably
foreseen it’s a nuisance rather than negligence.
*You don’t need negligence to have nuisance or trespass
*Distinction between nuisance and trespass – hard to distinguish
i.e. spewing black smoke may be both a physical invasion by the smoke particles
(a trespass) and as a use of land that causes substantial and unreasonable harm to
the use and enjoyment of neighboring property (a nuisance) – P is usually
allowed to proceed on both theories.
5. Spite fences: constructed out of malicious motives to block neighbor’s light and air
- It’s a spite fence even if it causes no harm to P except the knowledge that it’s there
for spite
- Doesn’t have to be actual fence, can be a building built to block P’s light/air – i.e.
Fountanbleau Hotel.
- Most states grant injunction against them
*A spite fence, erected solely to harm the neighbor and of no economic benefit to the
erecting party, can be enjoined as a nuisance. Such conduct has no social utility.
6. Access to sunlight now recognized
a. Social Policy of favoring unhindered private development in an expanded society is
no longer in harmony w/realities of society (don’t necessarily want widespread
development that destroys natural resources)
b. Sunlight no longer just an aesthetic value (i.e. used for solar energy/light)
i.e. Prah v. Maretti
*Doctrine of Ancient Lights; no American case recognizes this doctrine, but it provides
for right to get light and air. Common law = no easement for light or air.
7. Remedies (See page 332 in text)
a. Property rules: fix an absolute entitlement to either engage in the conduct or be
secure from harm
1) If P wins, gets injunction and activity stops
2) If D wins, gets dismissed (Fountainbleau)
b. Liability rules: prohibit each party from interfering w/the interests of the other unless
the party is willing to pay damages
1) If P wins, gets damages (D still free to commit the harm)
2) D can still commit the harm if willing to pay damages
3) P can stop D’s conduct by getting a purchased injunction (P pays damages to
compensate D for his loss of profits from stopping activity)
c. Inalienability rules: entitlements can’t be sold or exchanged
1) No right to do the activity even if you compensate for it
2) Can’t bargain it away or pay someone not to sue you for nuisance
a) Even if you make such a deal, can’t be enforced or used as a defense
b) i.e. right to lateral support is inalienable
3) Worried about externalities of the activity – you may be willing to bargain away
the right, but policy worried about how this would affect others
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8. Summary of Nuisance law:
a. P can get injunction when D’s conduct is unreasonable (causes more social harm
than good) and causes substantial harm to P
b. P can get damages (but no injunction) when D’s conduct is reasonable (it causes
more social good than harm and so should be allowed) but the harm to P is
substantial so that it is unfair to burden P w/the costs of D’s socially useful conduct
c. P is entitled to no remedy if:
1) The harm to P is not substantial, or
2) D’s conduct causes more social good than harm and it’s not unfair to impose the
costs of D’s activity on P, or
3) The imposition of damages would put D out of business and avoiding this result
(b/c of the social value of D’s conduct) is more important than preventing the
harm to the P
d. P is entitled to a purchased injunction if D’s conduct causes more harm than good
but it is fair to impose the cost of shutting down D’s activity on P
9. Cases:
Page Appliance Center v. Honeywell
- Honeywell placed a computer in a business adjoining Page that interfered w/Page’s
business of selling TV sets
- RULE: lawful activity constitutes a nuisance if it unreasonably interferes w/another’s
enjoyment of his or her property
*Private nuisance/nuisance in fact
Fountainbleau v. 4525, Inc.
- 4525 sought to enjoin the Fountainbleau Hotel’s construction of an addition that would
block all sunshine from 4525’s hotel
- P had no legal claim to the sun
- “One must use his property so as to not injure the lawful rights of another” for a nuisance
to exist
- RULE: there is no legal right to the free flow of light or air from an adjoining parcel of
land.
Prah v. Maretti
- Prah sued to enjoin Maretti from building on his land so as to block the flow of sunlight
to Prah’s solar heated house
- Balancing test of rights of parties v. social utility
- RULE: the doctrine of prior appropriation applies to the use of sunlight as a protectable
resource.
- Given the new solar technology, sunlight must be regarded as a valuable resource and the
doctrine of appropriation applies to protect those who first exploit the resource.
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F. Support Easements and Lateral Support
If you begin an
action on your
land, then you
have a duty to
inform or give
sufficient notice
so a neighbor may
take steps to
protect their land
–if no, then
negligence.
1. Subjacent support easements; The right to have one’s land supported by the earth that lies
underneath it.
– You’re not allowed to undermine the surface (e.g. when digging for minerals, etc)
– You have a duty to support the surface area from Subsidence (sinking).
*You can purchase the right to undermine the surface that is under subjacent support.
2. Lateral supports – common law
a. Lateral support rights
1) Absolute right to support for land in natural state
- If building cannot be supported by land in natural state, liability for land
only, not structure.
- If land in natural state can support a structure, liability for both land and
structural damages.
b. Strict liability standard
1) Commission or omission
2) Duty to support (artificial state – homes, buildings, etc) is on the party
that came later
LATERAL SUPPORT
COMMON LAW
Noone v. Price
- Noone contended Price breached her duty to supply lateral support for Noone’s
hillside home by allowing a retaining wall to fall into disrepair
- RULE: an adjacent landowner is strictly liable for acts of omission and commission
which withdraw lateral support of his neighbor'’ land sufficient to support it in its
natural state; however, if as a result of the additional weight of a building so much
strain is placed on the lateral support that it will not hold, then in the absence of
negligence the adjacent landowner is not liable for any resulting damages
- At the time Noone’s wall was built, there were no structures on Noone’s land.
Therefore, the wall needed only to support the land in its natural state. The
builder was not required to supply support sufficient to withstand the erection of
any building on the land. Therefore, Price, as the successor in interest, was not
obligated to strengthen the wall to support Noone’s house
3. “Runs w/the land”
- It comes w/the land (when you buy it)
- If easement is in writing
- The original grantor who created the easement extended the easement to run with
the land
- Subsequent owners of the servient estate had notice of the easement at the time of
purchase of the servient estate. Three types of notice:
- Actual Notice
- Inquiry Notice; reasonable buyer would do further investigation to discover
whether an easement exists.
- Constructive Notice; whether or not they knew or should have known.
- When listed
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SUBJACENT SUPPORT
RIGHT TO DIG VS. RIGHT TO SUPPORT
Friendswood Development v. Smith-Southwest Industries
- Friendswood pumped a great deal of subsurface water from their land, causing
subsidence in adjoining plots of land
- RULE: a person is liable for damages caused by drawing water from his own land
only to the extent that his activity was negligent
- Modern Rule: landowners will be held liable for damages caused by the negligent,
willfully wasteful, or malicious withdraw of subterranean waters
I.
OWNERSHIP OF REAL PROPERTY (See Gilberts pg.301)
A. Servitudes
1. EASEMENTS
a. Definition: a privilege to use the land of another; can be bought and sold
(analogous to a piece of property)
b. Four ways to create an easement:
1) Prescription
2) Prior use
3) Necessity
4) Express grant
c. Prescriptive easements (think AP except P only wants part of land, not all of it)
1) Elements:
- Open and notorious,
- Hostile
- Uninterrupted
- Continuous use over a statutory period in which the fee owner has acquiesced –
occasional use insufficient (so if use is so infrequent that a reasonable landowner
would protest continuity requirement not satisfied)
- Tacking allowed (get prescriptive easement by tacking on to use by previous
user when less than statutory period)
- Seasonal use
2) Applies to acquisition of nonfee interest in land
3) Extent of acquisition: you only get the land for the purpose you were using it for
4) Some courts require prescriptive easement claimant to prove acquiescence by
true owner (true owner failed to attempt to stop adverse use by bringing a
trespass action)
5) Negative Prescriptive Easements not allowed
a) If allowed, owner claiming prescriptive rights has in no way violated
neighbor’s property rights by trespassing (there would be no trespass)
b) Lawful use of one’s own property doesn’t place the true owner on notice that
she must bring a suit to protect herself from losing her property rights
c) Allowing negative easements to be acquired by prescription interferes w/the
free development of land
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d. Affirmative v. Negative easements
1) Affirmative Easements– right to enter property owned by another – A is given
the right to use B’s property by B
*May be acquired through prescription.
2) Negative Easements – enables holder to prevent owner of land from using it in a
certain way (rare)
– A prevents B from doing something on B’s property that B otherwise would
have been able to do (also called an easement appurtenant)
a) Common law, a limited protection of access to
- Light
- Air,
- Subjacent or lateral support, and
- Protection from interference w/the flow of an artificial stream (why some
things are covered in covenants instead of easements)
b) Courts now recognize new types of negative easements:
- Conservation – to prevent development of land held for environmental
purposes;
- Solar – to protect access to sunlight for solar energy;
- Historic – preventing destruction or alteration of buildings that have
historical or architectural importance;
- Easements for a view – to protect an owner’s right not to have a
particular view blocked by construction on the servient estate
e. Express v. Implied Easements
1) Implied – are recognized in particular kinds of relationships despite absence of
express K to create the easement (i.e. by use or necessity); exception to statute of
frauds; parties must have intended to create or reserve the easement
a) Easements implied from prior use (easements created by implication)
(1) Owner divides her property and sells one parcel, retaining other for
herself (severance) or granting it to another; one parcel was previously
used for the benefit of the other parcel in a manner that was visible and
continuous and the use is “reasonably necessary” for enjoyment of the
dominant estate
(2) Implied easement must arise at time of severance to be created
(3) Proof of prior use is necessary b/c it’s evidence that the parties probably
intended an easement on the presumption that the grantor and grantee
would have intended an easement on the presumption that the grantor
and grantee would have intended to continue an important or necessary
use of the land known to them and that was apparently continuous and
permanent in nature
(4) Easement by reservation: if grantor intends to retain an easement over
the property conveyed to the buyer, the property burdened by the
easement (the servient estate) is subject to an easement by reservation
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b) Easement by necessity
(1) Granted to the owner of a landlocked parcel over remaining lands of the
grantor to obtain access to the parcel (is for the purpose of getting a
landlocked property owner to a public road)
(2) Policy: effectuates the intent of the parties and promotes the efficient
utilization of property
(3) No evidence of prior use necessary but dominant and servient estates
must have at one time been owned by same person
(4) Easement lasts as long as necessity lasts
(5) Some courts say intent matters: no easement by necessity granted if it’s
clear grantor intended to sell and grantee knew she was buying a
landlocked parcel
(6) Can be granted if all three are satisfied:
(a) Landlocked
(b) Must have been common ownership at some time in the past (most
states will accept public ownership – almost everything is in
common ownership (by the US gov’t); other states require private
common ownership
(c) Strict necessity – there is absolutely no other route available
Finn v. Williams
Finn owned 40 acres; Williams owned 100 acres that was directly north of Finn’s land;
there were roads leading to Finn’s land, but then the roads were eliminated, resulting in
Finn’s property being landlocked; there was a public road by Williams’ land
RULE: when an owner conveys a portion of his land which has no outlet except over the
land of the grantor, or of strangers, an easement by necessity exists over the retained land
of the grantor
Court’s holding: if at one time there had been unity of title, the easement by necessity
will pass with each transfer as appurtenant to the dominant estate and may be exercised at
any time by the holder (it makes no difference that the easement wasn’t used earlier)
2) Express
a) Created by explicit agreement of the parties (much more common than the
other types of easements)
b) Requirements to create an express easement
(1) Must be in writing (except for prescriptive easements and easements by
estoppel, prior use, necessity and constructive trusts) – must be in writing
to satisfy statute of frauds
(a) Rule against reserving an easement in a third party
1. Common law did not allow a third party to benefit from an
easement – you must be either the buyer or the seller
2. Some courts use estoppel to prevent grantee from interfering in
easement reserved to a third party
Ex: three acres of land next to each other; O owns the middle land
and the land to the left; B owns the one on the right; O sells his
middle piece to A but wants to protect B by granting him an
easement (common low won’t allow this); one way to get around this
is by making two separate transactions – O sells the land to B and B
grants an easement to A; this is not preferable b/c of the taxes
involved and the possibility that B may not grant the easement to A
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(b) Covenants – includes requirements that do not apply to easements,
such as they touch and concern and privity of estate requirements
(c) Can’t create an affirmative easement on one’s own land
1. Traditional law does not allow creation of an affirmative duty to
do something on someone’s own land such as a duty to build a
structure or pay a monthly fee to a condominium association
2. Easement by reservation – when you sell part of your land but
you retain an easement over the land you sold off
(2) Notice – burdened estate owner must have notice of the existence of the
easement
(a) Actual: you are told of the easement (may be specifically contained
in the deed)
(b) Inquiry: you don’t know for sure if there’s an easement, but a
rational person would wonder if there’s an easement – it’s your duty
to inquiry and you’re bound by the info you would have found out
had you made an inquiry – you can’t say that no one told you
(c) Constructive: purchaser is held to have known that there’s an
easement on their land if the easement is on the public record – you
must do a title search to find out about your land
(3) Intent – must be known; intent to have the easement of necessity, etc.
must be known; any language in the easement that says “easement is for
grantee and her heirs and sons” shows intent
(a) You are bound by anything that is in the public record about your
property
Green v. Lupo
FACTS: Green granted Lupo a deed release upon the sale of his property on the
condition that when Lupo acquired title he would grant Green an easement
RULE & Holding: an easement isn’t personal if there is anything in the grant to suggest
that it was intended to be tied to the land retained or conveyed – the written instrument
granting Lupo his easement states the easement would be granted to Green for ingress
and egress to their property – thus the easement was granted to gain access to a particular
piece of land and is thus appurtenant, not personal – any kind of language for ingress,
egress and utilities means it’s an easement appurtenant
- Ingress; The act of entering
- Egress; The act of going out or leaving
- Easement Appurtenant; benefit to run with the land, cannot be severed from the land.
- Easement in Gross; personal, not to benefit any piece of land.
- Commercial; alienable and transferable.
- Personal; not alienable (considered an invitation).
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Cox v. Glenbrook
FACTS: Glenbrook owned land subject to an easement for access from Cox’s land; the
parties contested the extent of the easement
RULE & Reasoning: where the grant is unclear, the extent of the easement must be
construed as broad as necessary to carry out the purposes for which it was granted; as
broadly as necessary for family use defines the easement by the person holding it rather
than the land it benefits – the grant was intended to give ingress and egress to the land –
this intent does not support doubling the size of the road and paving it – the easement is
limited to the size and nature at the time of the grant
Henley v. Continental Cablevision of St. Louis County, Inc.
FACTS: Henley granted the telephone company the right to construct and maintain
telephone and electrical systems that Continental licensed in order to install cable
services
RULE & Reasoning: easements in gross are freely transferable; the easement granted by
Henley was not tied to a dominant estate and was thus in gross; the easement granted was
exclusive to the telephone company and thus the owners of the servient estate could not
affect how the rights are exercised; b/c the rights are exclusive they are also alienable,
consistent w/the use for which the easement was granted. The key is to look at the right
of the grantor, if they did not reserve a right for themselves, then it makes the easement
exclusive and can be shared with others.
f.
Easement Appurtenant v. Easement in Gross
1) Appurtenant: runs w/the land
a) Benefit must be intimately tied to a particular piece of land, not a person
(dominant estate)
b) Not enough that beneficiary of easement happens to have an interest in a
piece of land that’s made more valuable by the easement
c) Party that is benefited by the easement is the dominant property; property
that has to provide the easement is the servient tenemant
d) Requirements for appurtenant transfers
(1) Writing (only needs to be written once, not re-recorded w/each deed)
(2) Original owners must intend for it to run w/land
(3) Notice (don’t need all 3 kinds)
(a) Actual: goes to buyer’s state of mind – hardest to prove
(b) Inquiry: observable conditions; should ask
(c) Constructive: easement recorded somewhere and should check
e) Does burden run w/the land? (servient estate)
(1) Transfer: when title to the servient estate is transferred, burden of the
easement remains w/the property
(2) Subdivision: if servient estate subdivided, burden of an easement still
attaches to the same parts of the land as before (easement may only
burden a portion of the larger parcel so only that portion still burdened)
f) Does benefit run w/land? (dominant estate)
(1) Transfer: appurtenant easement normally passes w/transfer of dominant
estate (automatic transfer) – exception is when there is a contrary
agreement
(2) Subdivision: when dominant estate is subdivided into smaller lots, if two
or more of the subdivided lots can take advantage of the easement, they
have the right to do so – if only one part of the dominant estate can
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benefit, that portion will be the only dominant estate after the subdivision
– exception is if servient estate’s burden is largely/drastically increased
2) In gross: benefit doesn’t run w/the land (attached to person)
a) Generally
(1) Benefit tied to person so it doesn’t matter if that person is in possession
of a particular piece of land – simply a right to go across someone’s land
for whatever use is desired (ex: electrical lines – the electrical lines can
be put there so that everyone can get electricity)
(2) Only grantee has right to use it (future possessors have no right since it
attaches to person, not land)
(3) Can’t be created by implication
b) Is easement transferable?
(1) Personal easement: nontransferable (personal to holder)
(2) Commercial easement: alienability more likely intended (but not
divisible – i.e. easement can be assigned to more than one person, but
they may not make separate uses, but instead hold “as one”; i.e. one who
gives phone company right to string wires over property probably intends
that this right should pass to any other company that takes over the phone
operation)
c) Is easement divisible?
(1) If nonexclusive (grantor or owner of servient estate reserved for herself
the right to use the easement in conjunction w/the grantee) easement
- Non-apportionable (grantor could sell further rights to others so long as
those new easements didn’t interfere w/the use of the existing easement
by the first grantee)
(2) If exclusive (grantor has no right to use the easement in conjunction
w/the grantee), easement
- Apportionable (grantor has no right to other easements, so grantee is not
interfering w/any rights grantor may have to sell/lease use of easement to
others)
g. Scope – did owner of easement misuse it by going beyond scope of intended
activities?
1) Is the use of the kind contemplated by the grantor? – general right of way usually
held to be usable for any reasonable purpose but some courts hold rights of way
limited to the specific purpose contemplated at time of creation – if created by
implication, ct will look to use as it existed prior to conveyance
2) Is the use so heavy that it constitutes an unreasonable burden on the servient
estate not contemplated by the grantor? (i.e. motorcycle use allowed, but noise
too great) – look at writing, intent, and notice to figure out scope of easement –
courts won’t impose an unreasonable burden on the servient estate
3) Can it be subdivided? (see above)
h. Terminating easements
1) By writing
2) By term (easement by terms runs a certain amount of time only)
3) By merger (easement disappears if dominant and servient estate merge)
4) By abandonment (a question of intent)
5) By adverse possession
6) By marketable title acts (statutory changes that require that people who have
easements register them – i.e. if not registered, terminated)
7) By abuse of easement
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2. LICENSES
a. Definition: Permission to go on land belonging to the licensor
- (License is the lowest form of permission; also the most informal form of permission)
1) Revocable at any time – owner is not required to give advance notice
2) Not expandable – not transferable to others
b. Irrevocable licenses; A license may become irrevocable in certain limited situations
(depends on the state you are in).
1) License coupled w/an interest –cannot be revoked
a) Where the licensee expends resources and the licensor knew of the
expenditure, the license becomes irrevocable
b) Ex: farmer A needs to build a pipe line that will bring water to his property;
farmer B’s land is in between the stream and A’s property; A builds the pipe
w/B’s permission, but before the pipe crosses the border between A & B’s
land, B revokes the license – court does not allow this – A can build the pipe
onto his land as long as the purpose doesn’t change (if A decides to quit
farming and build houses, then license is revoked)
2) Promise to grant a license
a) Ex: the selling of a movie ticket
3) Easement by estoppel
a) Changes from license to easement b/c of estoppel
b) Estoppel theory: if a licensee invests substantial amounts of $ or labor in
reliance on a license the licensor may be estopped to revoke the license, and
the license will thus become the equivalent of an affirmative easement.
c) i.e. if licensor stands by and watches licensee use and improve road, the
licensee relies on this use, even though licensor could have said no
originally, can’t do so any more b/c licensor acquiesced and license becomes
irrevocable and continues as long as needed (license turns into an easement
by estoppel – Holbrook)
Holbrook v. Taylor
FACTS: Taylors are suing to get a road; Holbrooks own the property; Holbrooks (years
ago) sold the road to a mining company; the mine closed; Taylors built a house on their
property (the road led to the property); Taylors got permission from Holbrooks to use the
road during their house construction; Taylors improved the road the Holbrooks knew that
the Taylors were going to depend on the license to build their house – the license
becomes irrevocable – if the Taylors sold their house, the license would transfer
RULE: Where use of a roadway, improvements to and maintenance of a roadway all
have occurred w/the tacit approval of the landowner, the landowner is estopped from
barring access to the improving party. **Depends on the state.
d) Arguments against having easements by Estoppel:
1) Disagrees w/ S/O/F by allowing an oral K (license) to turn into an
easement, which should be written since it conveys an interest in land
2) Decreases marketability of land b/c license becomes irrevocable
3) Disagrees w/AP hostility req’t b/c even though owner acquiesced
(normally would go against AP), nonowner still gets to use land
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4) Constructive trust; a trust imposed on equitable grounds against one who has
acquired property for wrongful use, to prevent unjust enrichment.
a) Need fraud (don’t need it for easement by estoppel)
*A trust is an arrangement that has three different roles:
1. Settlor –owner of property
2. Trustee –legal owner of property
3. Beneficiary –person who gets benefit of the property
*People can have multiple roles
Rase v. Castle Mountain Ranch, Inc.
Travenor held a piece of land for over fifty years; during that time he invited Rase and other
friends to build cabins on the property and use the property; after several years, Travenor had
cabin owners sign a license subject to a fee and had a termination provision; cabins were bought,
sold and improved; no licenses were ever terminated; Travenor sold his land to Castle; Castle
tried to terminate all the licenses; Court Imposed a constructive trust on the land in favor of the
cabin owners
STATUTE OF FRAUDS
Generally, property rights must be transferred by written document, but there are exceptions:
1. Easement by Necessity
2. Easement by Estoppel
3. Easement by Prescription
4. Implication from prior use (Irrevocable License)
5. Constructive Trust
3. PROFITS
a. Right to remove objects from real property – specialized form of Affirmative
easements
*i.e. Crops, timber, minerals, wild game, and fish.
b. Profits occur in gross (or may occur in prescription)
c. Profits are Transferable (if I sell you a profit, you can sell it off to another party)
d. Some profits are exclusive (it should be noted in the profit)
1) If exclusive, it is typically dividable (I can sell the right to two or three
companies)
-Excludes the owner of the property
2) If not exclusive, then it’s not devisable
-Includes property owner
e. Profit always has an easement of access (to come onto the owner’s land)
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4. REAL COVENANTS
a. Definition: A promise to do or not to do a certain thing.
*THINK OF THESE AS AGREEMENTS BETWEEN NEIGHBORS GOVERNING
ACTIVITIES RELATED TO THE LAND OR THEIR SHARED INTEREST IN THE
LAND
Real Covenants vs. Equitable Servitudes
Real Covenants are for damages
Servitude is for equitable relief
Real Covenant vs. Easement
Real Covenant is a promise relating to the use of the land
Easement is a grant of an interest in land
*An easement may give the right to enter another’s land, a covenant never gives this
right.
b. Five required elements (not all states require all five, some require four)
1) Writing – must have formal writing
2) Notice – (states frequently skip this requirement)
a) Actual
b) Inquiry: if you see physical evidence of a covenant, it’s your duty to find out
about it
c) Constructive: something that is in the property records so you’re bound by it
3) Intent – if you have evidence that binds future owners of the land, it will be
sufficient to show that there is covenant on the land
4) Privity = Consideration (relationship)
a) HORIZONTAL: Privity of estate existing between the original covenanting
parties.
(1) Mutual relationship: some state require this in order to have horizontal
privity – if A sells land to B, this isn’t a privity relationship (in states that
say you need a privity relationship) – landlord/tenant relationships,
easement holder/owner of servient property are considered mutual
relationships – anytime during this relationship, you can create a
covenant b/c the relationship is continuous.
(2) Instantaneous relationship: a property transfer (sale of land from A to
B) creates an instantaneous privity relationship (the moment one party
transfers property interest to another) – this moment is sufficient to fulfill
the privity requirement – most states say that this relationship is enough
– a will is sufficient to create a covenant (transfer of land from one to
another)
-i.e. Sale of land when title of transferred
-i.e. Deed that transfers a gift
-i.e. Landlord/Tenant
b) VERTICAL: Privity of estate existing between the successors of the
original covenanting parties.
*In order to be bound to a coveant you must have the same property interest
as previous owners.
(1) Strict: both parties are required to have the same property interest
(2) Relaxed: most states have a relaxed vertical privity – if you are a tenant,
this is enough to satisfy the vertical relationship requirement
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5) Touch and concern land
*Covenant must create an interest in land that “touches and concerns” promisee’s
land (for benefit to run) and promisor’s land (for burden to run)
a) Affects your use and enjoyment of the land, or
b) Affects the value of the land
c) Defines your relationship with others as to how you own the land
i.e. promisor covenanted to do or refrain from doing a physical act on his land,
the burden touches and concerns his land
*Money payments are not considered as touching and concerning the land
*When dealing with personal relationships, none of them generate binding real
covenants because it does not concern your ownership to the land.
c. Termination of covenants: (if not already struck down)
1) Changed circumstances doctrine: do people who where supposed to benefit
(dominant estate) still do so?
2) Relative hardship: covenant construed as not to place burden on servient estate
3) Estoppel: owner of a dominant estate who orally tells owner of servient estate
that she won’t enforce the covenant may be estopped from asserting her interests
in enforcing the covenant if the owner of the servient estate changes his position
in reliance on the oral statement (must sue at first opportunity or estopped)
4) Marketable title acts: if covenant not registered, it dies
5) Abandonment: if people no longer operate according to covenant
6) Merger: if dominant/servient estate join as one
7) Prescription: an outsider can use some of the property for a certain amount of
time and then achieve rights that they are entitled to after the period of time
8) Term: covenant may only last a certain # of years; covenant may say how it can
be renewed
9) Written release: 2 entities/owners of land can kill the covenant by writing one
10) Acquiescense: Permission to some –allows all.
i.e. – we have a covenant that says no home offices may exist; over a few years,
six or seven people in a subdivision open doctors’ offices in their home; the next
person who opens a doctor’s office is an enemy of the home owner’s board; the
person sues the board and says that b/c they’ve allowed all the other people to
open an office before, they have to let this person open the doctor’s office
11) Release: every person who owns an interest gives it up (it will be hard to get this
b/c there is always at least one person who won’t release)
12) Laches: similar to estoppel; you could have told me at a certain time during
construction that the building did not adhere to the covenant; you must tell the
builder in time, if you wait too long, you’ll be subject to laches
13) Unclean hands: once you’re in violation of a covenant, it’ll limit your ability to
enforce your covenants on the land
14) Statutory: a statute can say when a covenant can end; some states may have a
statute that allows a covenant to end when it can’t through the other ways listed
above
d. Public policy limits on Enforceability
1) Some covenants are unenforceable under all circumstances, regardless of parties’
intent
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2) Restraints of alienation: we want to promote the free transfer of property in the
marketplace and prevent monopolization and establishment of family dynasties,
however, there’s the theory that if we don’t let people covenant, they won’t get
rid of land (failure to uphold covenants adversely affects marketability) –
restraints on alienation may be a cover for discrimination
3) Anticompetitive covenants: we don’t want to restrict competition, but
reasonable anti-competitive clauses in covenants are permissable to encourage
responsible investments in land
4) Racially restrictive covenants: private discrimination allowed; constitution only
regulates public (state-enforced) discrimination, therefore, if you make a racially
restrictive covenant, it may be legal, but it will be unenforceable
5) Implied reciprocal negative servitude: covenant on certain parcels – owners of
them can enforce them on other parcels w/o the covenant (restrictions apply to
everything or nothing); based on inquiry notice; prior grantees usually want to
enforce them against later purchasers in same subdivision or developer may
enforce or later purchaser may enforce against original owner (so that benefit
runs w/land)
a) Based on either: (1) developer’s representation (oral or written) about how
property will be developed; (2) common plan/scheme that shows uniform
plan of development from which everyone is restricted
5. EQUITABLE SERVITUDES
*(a.k.a. Restrictive Covenant) A private agreement usually in a deed or lease that restricts
the use and occupancy of real property esp. by specifying lot size, building lines,
architectural styles and the uses to which property maybe put.
a. THINK OF THEM AS RULES THAT GOVERN WHAT YOU CAN OR CAN’T
DO ON YOUR PROPERTY
1) Regulations imposed on subdivisions/condo associations
a) Single ownership
b) Rules created then applied
c) Lots then sold
b. An equitable servitude must be written in the deed and recorded
c. Elements of equitable servitudes:
1) Writing – a majority of state require this but not all – common plan, physical
evidence
2) Notice – only binding on people who have notice of them
3) Intent – covenant must specify that it was intended to run w/the land (required in
every state)
4) Touch and concern land – majority of states talk about this but a minority
ignore this (minority say that if you have notice and intent, then it’s enough for
an equitable servitude)
5) Common ownership – somebody has to own all of the property when the
equitable servitude was created
a) Once you no longer own property, you can not enforce an equitable servitude
– one way to get around this is to own at least one lot or to own the common
area; another way is if the owner continues to develop the land, they can
maintain control over covenants and equitable servitudes. Owner can also be
a part of the homeowner’s association which can enforce the covenants and
equitable servitudes – this has to be specified
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d. Ways equitable servitudes can end (look above at covenants)
EQUITABLE SERVITUES AND THE COMMON PLAN
Evans v. Pollack (reciprocal negative easements)
FACTS: Evans sought to enjoin the commercial use of unrestricted lots w/in a restricted
subdivision under the doctrine of implied reciprocal negative easement doctrine. Evans and
McCormick purchased land and subdivided it. McCormick died, and Pollack purchased land
with the intent to build a marina. Covenant prohibited land for commercial/bus. Purposes.
RULE & Reasoning: A general plan of subdivision restriction need not apply to all tracts in a
subdivision for a general plan of subdivision restriction to apply; Evans is asking that we imply a
reciprocal negative easement on the land Pollack seeks to buy; a court may imply such an
easement on a showing that the subdivider had a general development scheme for the subdivision;
here, the restricted lots are all similarly situated; they need not encompass the whole subdivision,
so long as the restrictions apply to well-defined lots – since that is the case here, reciprocal
negative easements may be implied
*Owners can have within the subdivision more land than they intend to subject to the equitable
servitude and as long as there is a clear plan, they will be binding.
*Impled Reciprocal Negative Easement; rules apply not only to the land divided but the land
retained by the owner.
Sanborn v. McLean (reciprocal negative easements)
FACTS: Sanborn, owned lot on subdivision and began erecting a gas station. Plntf McLean
claims def. Gas station violates general fixed scheme (residence). Def. Claims no restriction, no
notice, there is no general scheme.
RULE: A reciprocal negative easement is created in all real property that is conveyed by the
same common grantor even if the restrictions are explicitly contained on some but not all lots.
*Doctrine of reciprocal negative easements); reciprocal negative easements are not personal to
owners but are operative upon use of the land by any owner having actual or constructive notice
thereof.
Riley v. Bear Creek Planning Committee
FACTS: Riley purchased a lot in a subdivision; however, the deed did not include a restrictive
covenant which was imposed on the surrounding lots (example of one extreme where the cts
require you to do everything right in order to recognize that an easement was created)
RULE & Reasoning: Restrictive covenants are only enforceable against subsequent grantees
when the restriction is in the chain of title and the grantee has actual or constructive notice
INTERPRETATION OF AMBIGUOUS COVENANTS
GROUP HOMES AS “SINGLE-FAMILY DWELLINGS
Blevins v. Barry-Lawrence Cty Assoc.
FACTS: Blevins contended that a group home for retarded adults violated the restrictive
covenant on the land
RULE & Reasoning: Ambiguous restrictive covenants should be read narrowly to allow the least
restrictive use of the land; public policy opposes restrictions on the use of land – where a
covenant is unclear, it should be read in the least restrictive manner possible.
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NEIGHBORING PARCELS
Whitinsville Plaza v. Kotseas (anti-competitive covenants)
FACTS: Kotseas leased to CVS, no verticle privity, trust sold to Plaza, verticle privity exists. In
selling land to the Plaza’s predecessor in interest, Kotseas had agreed to a covenant not to have a
competing business on his adjoining land
RULE & Reasoning: reasonable covenants against competition may run w/the land when they
serve a purpose of facilitating orderly and harmonious development for commercial use
TERMINATING COVENANTS AND EQUITABLE SERVITUDES
COMMON LAW: CHANGED CONDITIONS
El Di v. Town of Bethany Beach
FACTS: Bethany Beach sought to enforce a restrictive covenant prohibiting the sale of alcoholic
beverages, even though the nature of the neighborhood had changed greatly since the creation of
the covenant
RULE & Reasoning: a restrictive covenant will not be enforced where a fundamental change in
the nature of the neighborhood has made the purpose sought by the covenant unattainable – cts
will not enforce a restrictive covenant to no purpose
STATUTORY REGULATION OF COVENANTS
Blakely v. Gorin
FACTS: Blakely wanted to build a hotel to be connected by a passageway over an alley w/an
existing structure owned by him
RULE & Reasoning: building restrictions may be denied specific enforcement where they would
unreasonably impede the most feasible use of land and money damages would adequately
compensate the party asserting the restriction
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B. Estates and Future Interests
1. General
a) Primogeniture – the eldest male child inherits all of the land
b) Coparceny – if there was no eldest male, then all the daughters inherited the land; as
each daughter married, she lost control of the land and it became her husband’s.
There are five categories of future interests:
1. Reversion
2. Possibility of Reverter
3. Rights of Entry
4. Remainder
5. Executory interest
Two groups of future interests:
1. Retained by grantor
2. Created in a grantor
*Landowners may control future use of property by contract through Servitudes.
*Future interests exist the moment they are created.
Two Policy concerns to Future interests:
1. Dead Hand Problem
2. Heirarchy and quality
Must determine for all estates:
- Is it Alienable (transferable)?
- Is it Devisable?
- Is it Inheritable (pass to heirs)?
Present Interest
Fee Simple Absolute
Fee Simple Determinable
Fee Simple Subject to Condition
Subsequent
Fee Simple Subject to Executory
Limitation
Life Estate
Words Often Used to
Create the Interest
“to A”
“and her heirs”
“so long as”
“while”
“during”
“until”
“unless”
“provided that”
“on condition”
“but if”
Future Interest
In Grantor
--------------------------
Future Interest
In Third Person
------------------------
Possibility of Reverter
------------------------
Right of Entry (for
condition broken) or
(Power of Termination)
------------------------
“until (or unless)…,
then to…”
“but if…, then to…”
“for life”
--------------------------
Executory Interest
Reversion
Remainder
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2.
COMMON LAW
FALL 2001
FEE SIMPLE ABSOLUTE
a) No associated future interest (no conditions on possession, inheritance or survivorship).
b) Is fully alienable, devisable (As of the Statute of Wills in 1540), and inheritable.
c) Owner of a fee simple estate can choose who will own the property after her death by either a
will or state intestacy statute
d) If you own one of these, it’s the same FSA that will travel from one person to another
e) No future interest in this type of estate
f) FSA is fully transferable (you can transfer any portion of it during your lifetime); devisable
(ability to write a will and transfer property this way); inheritable (transferring according to
the laws of the state involved (automatically inherit land through the state’s law)
g) Under common law, you had to use specific words to transfer land:
- words of purchase: defines who gets something;
- words of limitation: words that limit the estate – defines the estate you are getting – defined
the title.
*Today these all create a fee simple absolute, before 20 th Century only created a life estate)
1) “A” and his heirs – defines FSA; means property was not fully transferable – you have to
go to all the heirs to purchase a piece of property
2) “A” in fee simple absolute – creates a life estate
3) “A” and her heirs – under common law, you’d be giving “her” a life estate if this was
included in the estate
4) “A” OR his heirs – (not in casebook) these are words of purchase; you have to know
how your particular state handles this; some states say that if this is in a will, it creates a
life estate, if it’s in a deed, it creates a remainder
3. FEE SIMPLE CONDITIONAL; FEE TAIL
a) Fee Simple Conditional
An estate restricted to some specific heirs, exclusive of others.
1) O to A and the heirs of his body – land is not fully transferable or divisible – A
must produce an heir of his body (a son born of his body)
2) Once A produces a son, then A can transfer the land – this is the only way the
land can be transferred
3) A cannot transfer before he has a son – A cannot leave the land to coparceny (the
land would go back to the lord above A
4) Most states don’t follow this – only a few states still use this
b) Fee Tail
An estate that is inheritable only by specified descendants of the original grantee, and
that endures until its current holder dies w/out issue.
*Purpose to put property in situation where it had to stay in family, it could not
be transferred out of the family.
Same words as FSC – means A has to produce an heir of his body.
1) If A produces a son, then A keeps the land and it transfers to the son
2) If A produced a son (although he may have died) then coparceny can occur,
however if no son was ever born, then the land goes back to the lord above A
3) Nowadays, in most states, it just creates a Fee Simple Absolute
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4. DEFEASABLE FEES
*Depending upon the state, they may be transferable and inheritable.
a. FEE SIMPLE DETERMINABLE
An estate that will automatically end and revert to the grantor if some specified event
ever occurs other than death.
i.e. To Albert and his heirs while the property is used for charitable purposes –future
interest is called a Possibility of Reverter.
1) It is a fee simple, w/ special condition on the owner
2) If condition violated, ownership will automatically revert to the grantor
3) The grantor owns a future interest called a “Possibility of reverter”
-This future interest exists the moment the FSD is created, has no present
possessory claim, but is owned by person.
4) Possibility of Reverter is only possibility b/c it is not known if the condition will
be violated
5) Examples:
(a) O to A so long as used for residential purposes
(b) O to A while used for residential purposes
(c) O to A during residential use
(d) O to A so long as used for residential purposes; if used for a nonresidential
purpose, the property shall automatically revert to O
6) The common law preferred FSD when creating a defeasible fee – if ambiguous, it
is assumed to be correct
7) Many states today will not assume the possibility of reverter – they require “O to
A so long as used for residential purposes; if used for a nonresidential purpose,
the property shall automatically revert to O” – these states are looking for an
express statement of reverter
(a) Under common law, the possibility of reverter was not divisible, not
transferable
(b) It is inheritable, however today, in most states, they are divisible and
transferable
8) The FSD itself was fully transferable, and after the Statute of Wills, it was
devisable; it is also inheritable
(a) If you own a possibility of reverter, it becomes necessary to make sure there
are no adverse possessors after FSD is violated (may lead to violator gaining
FSA)
9) Today, the condition must in some way be associated w/the land – O to A unless
A changes from the family name – courts today tend to say those are invalid
10) Because the Possibility of Reverter is a future interest in the grantor it is not
subject to the Rule Against Perpetuities.
b. FEE SIMPLE SUBJECT TO A CONDITION SUBSEQUENT
1) Rather than an automatic reversion of title to O (as in FSD), it creates an option
on behalf of O to claim that title
2) Examples:
(a) O to A on condition that the property be used for residential purposes; in the
event it is not so used, O shall have a right of entry
(b) O to A, but if used for nonresidential purposes, O shall have a right of entry
(c) O to A, provided that the property is used for residential purposes; if this
condition is violated, O shall have a right of entry
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3) Right of entry (power of termination/right of reentry) – these are all the same
future interest.
-Right of entry must be specified.
4) Exercising the right of entry under common law meant O marching onto the
land and kicking A off
(a) For the last 100 years, it means that a lawsuit can be filed, giving title back to
grantor
(b) The right of entry has a statute of limitations on it
5) Common law:
(a) Fully transferable and inheritable (and devisable after the Statute of Wills)
(b) The right of entry was only inheritable
(c) Most states have now made the right of entry fully alienable
(d) In some states, possibility of reverter is fully alienable, whereas right of entry
is not
(e) In some states, if you try to transfer a right of entry, you wipe it out totally
6) IMPORTANT NOTE: because the possibility of reverter and right of entry are
future interests held by the grantor, they are not subject to the rule against
perpetuities
7) Many states have a time period for how long a possibility of reverter and right of
entry can exist
(a) If the condition is not violated over a certain statutory period, then the future
interest vanishes
-This type of statute is called a marketable title act (about twenty states
have these and they range between 30 and 50 years – most of the Midwest
states are the ones that have these acts)
8) In ambiguous cases, the cts today prefer a FSSCS over a FSD – they prefer to say
that none of these were created
c. FEE SIMPLE SUBJECT TO AN EXECUTORY INTEREST/LIMITATION
1) Future interest (Executory interest) is not held by the grantor, it is held by a third
party.
2) Examples:
(a) O to A so long as used for residential purposes, then to B
(b) O to A so long as used for residential purposes; if not used for residential
purposes, then it shall automatically pass to B
(c) A – grantee of present interest
(d) B – grantee of future interest – executory interest
3) Executory interests were always alienable under the common law (as they were
invented in the courts of equity) – they are still transferable (since the statute of
Wills), divisible and inheritable
4) The Marketable title acts do NOT apply to executory interests – they only go
against future interests held by the grantor
-Marketable title acts; if the condition is not violated over a certain statutory
period, then the future interest vanishes.
5) Many states allow FSSEI to be set up w/either automatic execution or “option to”
execute “O to A so long as used for residential purposes, if not used for
residential purposes, then it shall automatically pass to B” or “O to A so long as
used for residential purposes, if not used for residential purposes, then B shall
have the right to enter the property”
6) By definition EI’s never vested, so it is always subject to the RAP
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5. LIFE ESTATES
An estate held only for the duration of a specified person’s life, usually the possessors.
1) A to B for life (unstated reversion)
2) A to B for life, then upon B’s death to A (express reversion)
3) B gets it for her life (subject to the fact that she not create waste), but when she
dies, her interest ends (waste – using the land in such a way as to harm it in the
long run) – grantor has kept a reversion – the measuring life is B’s life
4) Not devisable; not inheritable b/c it ends upon the holders death.
5) Transferable – say to X, but only until B died, as then X’s interest would end (i.e.
anyone who gets the property from B is subordinate to B’s life estate) – that
person (in this case X) holds “per autrie vie” – for another’s life (e.g. A to B for
the life of C)
6) Per autrie vie – the owner of the life estate can devise (or his heirs can inherit)
the life estate if the person whose life is the measuring life is still alive when the
grantee dies (“for the life of X” – must be a human life (it can be multiple people,
but it must be reasonable (5-10)) – the person must be living at the time it is
created (not an unborn child) and corporations don’t count)
7) Defeasible life estates
a) “A to B for life, but if not for residential purposes, then back to A” – A has
two reversions, one if B dies, another if B uses in a nonresidential way
b) “A to B for life, but if not for residential purposes, then to C” – C has an
executory interest – it cuts short B’s life estate and therefore it is an
executory interest. B has a fee simple subject executory interest/limitation
c) “A to B for life, then to C and his heirs” – this is a remainder – C would get a
fee simple.
8) Future interests for life estates
a) Reversions: back to grantor, not subject to Rule Against Perpetuities.
-Always follows an natural termination of a life estate.
b) Executory interests: to third party, and it cuts the life estate short; subject to
Rule Against Perpetuties
c) Remainders: to third party, but it doesn’t cut the life estate short; subject to
Rule Against Perpetuties.
d) NOTE: if a reversion survives the death of the grantor; it is fully alienable
9) Right to invade the corpus
a) The “body” is the property involved
b) “Greenacre from A to B for life, but if B has no other income, B shall have
the right to sell Greenacre in fee simple absolute”
c) Even though B only has a life estate, A can empower B to sell more than the
interest she possesses
d) This is a right to invade the corpus and this is an example of the power of
appointment (right to appoint a new owner, even though you don’t have a
fee simple absolute)
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6. FUTURE INTEREST IN THIRD PARTY
a. Common Law Statutes
1) Statute of Uses: executes uses; legal title always follows equitable title
a) “A to B and his heirs for the use of C” becomes essentially “A to C and his
heirs”
*Cestuque use –One for whom the benefit of the grant was made (C).
-The person for whose use and benefit property is being held by another (B), the
other person having actual legal title and right to possession.
2) Statute of Enrollment: you can’t transfer title of property without
recording/registering it in order to protect your property from others.
3) Statute of Wills: real property interest can be devised (either by will or
inheritance).
4) NOTE: these statutes were all COMMON LAW concepts which were enforced
in common law courts – chains of future interests were allowed under terms of
uses.
b. TRUST
1) A to B (the trustee) and to his heirs for the benefit of C (the beneficiary) – settlor
gives legal title to trustee, the beneficiary gets the benefit
*Equitable interests in property b/c it originated in equity courts.
c. POWER OF APPOINTMENT
1) Authority given to someone to pass title greater than the property interest that
they have
2) Power of appointment is a non-vested future interest in a third party
3) Can be very flexible but also very dangerous b/c you don’t know what will
happen at the time of appointment
4) Power of appointment is treated as future interest in third parties; they are never
vested when created
5) Power of appointment is subject to RAP
6) Two types of power of appointment
a) General – you have the power to name anyone as the owner of the land;
there’s no limit to this unless the state specifies some limits
b) Special/limited – you have the power to name someone from a specific
group of people as the owner(s) – ex: you can name an owner from among
the grandchildren, children, etc
d. EXECUTORY INTEREST
*Future Interest in 3rd parties that may cut short someone else’s property interst or
that will spring into existence.
1) Is any future interest in a grantee that doesn’t meet the definition of a remainder
2) Anything that puts a hold on a life estate is an executory interest
3) You either own a remainder or an executory interest, you can’t have both (EI
and remainder are two different types of future interests)
4) Ex: A to B and his heirs, but if B goes to law school, to C and his heirs
a) B has a fee simple subject to executory limitation
b) B has a present interest right now
c) If B doesn’t go to law school, then B will have a life estate
d) C has a fee simple subject to executory interest
e) C has an executory interest bc it cuts short B’s estate; it also follows fee
simple absolute
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f) C’s future interest, if it becomes a present interest, will only become so if B
doesn’t follow the limitation
5) A to B for life then to C
a) B has a life estate
b) B can do anything and C still doesn’t get the estate any faster b/c there’s no
condition
6) Two types of executory interest
a) Shifting
(1) Shifts future interest from grantee to another grantee
(2) Ex: O to A so long as used for a church, then to B
(a) Property shifts from A to B if not used for a church
(b) B has a contingent remainder
b) Springing
(1) Springs directly from grantor – grantee at time in future after conveyance
made
(2) Future interests are property interests that exist the moment they are
created; you can’t take back an executory interest; you can get them to
transfer back to you, depending on the situation
(3) An executory interest is springing when it comes into effect on an
appointed day
(4) Ex: O to A for life, then to B if B becomes president
(a) O has reversion subject to executory limitation
(b) B has a contingent remainder
(5) Ex: A to C on C’s 30th birthday; C is currently 10 years old
(a) C has an executory interest b/c it cuts short A’s interest; there’s no
other grantee involved
(b) However, if C dies before reaching 30, then the executory interest
dies
(c) If it is written “on the anniversary of C’s 30th birthday” then the
estate goes to C’s heir
7) Cy pres doctrine
a) Used to amend terms of a will, striking the part that makes it unenforceable
(i.e. racial restrictions)
b) Says “we will modify the specific words to carry out the general
meaning/intent of the grant”
c) Look at:
(1) Intent of grantor
(2) Can law enforce that intent?
e. REMAINDERS
1) Are future interests in a grantee
2) Subject to some specific rules before you can say a remainder has been created
3) Definition: a remainder is a future interest created in a transferee (third party)
which can become a present possessory estate, only on the natural expiration of a
prior estate created in favor of another transferee in the same instrument and
which does not follow a fee simple interest
4) Ex: A to B for life, then to C for life, then to D for life
a) C has a future interest that will only become a present interest upon the
natural termination of B’s present estate
b) Both the present and future interest are created in the same document
c) C and D both have remainders and life estates
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d) Here, A has a reversion b/c it doesn’t say “D for life and to his heirs”
*There are two classes of remainders:
-Vested
-Contingent
5) VESTED REMAINDERS
a) Generally:
(1) Given to a living ascertained person and there’s no condition precedent
(2) A vested remainder was transferable at common law
(3) Holder of a vested remainder was allowed to sue the present estate holder
in an action for waste if the present holder was causing damage to the
property
(4) If an interest is ambiguous, courts will more likely find that it’s a vested
remainder rather than a contingent remainder
*Three kinds of vested remainders:
b) Absolutely vested
(1) Vested from the moment created
(2) Never subject to RAP
(3) Vested remainder is inheritable, devisable, and alienable.
ex: A to B for life, remainder to C
(a) Absolutely vested remiander in C
(b) Even if C dies it goes to C’s devisees or heirs
(c) Transferable b/c it’s absolutely vested
(d) C can sell estate
c) Subject to open (partial divestment)
(1) Grant of a remainder to a living ascertained person, but it’s a grant to a
category of people and others may join that group of people later
(2) It’s vested if there’s someone already in the category when the remainder
was created, if there was no one in the category, then it’s a contingent
remainder
(3) Devisable, Alienable, and Inheritable
ex: A to B for life, remainder to C’s kids
(a) Gift to a category (c’s children)
(b) Once C stops having kids, or isn’t able to have kids anymore, then
this becomes an absolutely vested remainder in each of C’s kids
(c) Even if you die, it’s inherited by your kids
(d) This estate is divisible
(e) ½ of the states subject this type of estate to RAP
d) Subject to complete divestment (divestment; complete defeasance)
(1) Owner of remainder is in existence and ascertained
(2) There is no condition precedent, however there is some condition
subsequent – there is some executory interest that may take away the
remainder that we have
(3) Every vested remainder subject to complete divestment is
accompanied with a reversion that goes back to the grantor
(4) Never destructible, never subject to RAP – just like absolutely vested
remainders except that someone can take it away later
Ex: A to B for life, then to C, but if B remarries, then to D
(a) C has a vested remainder subject to complete divestment
(b) D has an executory interest (it’s in another grantee, but it cuts short
C’s vested remainder)
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Ex: A to B for life, then to C, but if C doesn’t outlive B, then to D
(a) D’s future interest is an executory interest – the only way D can get
this estate is by cutting C’s future interest
6) CONTINGENT REMAINDERS
a) Generally
(1) Condition precedent – not certain to happen
(2) Always subject to RAP
(3) Remainder is for someone not ascertained or not alive
(4) Subject to a condition precedent, then it will be a contingent remainder
rather than a vested remainder
(5) Eliminating destructibility means future interests will last longer
(6) When contingent remainders were destructible, it made CR more valid
under RAP; w/o destructibility, it is more likely the CR is invalid under
RAP
(7) Under common law, these were destructible
(a) If the condition isn’t satisfied, or if the category doesn’t have
members in it when the previous state terminates, then the condition
wasn’t satisfied and the remainder is destroyed
b) Examples:
(1) A to B for life and if B doesn’t remarry, then to C; if B remarries, then to
D
(a) C only gets estate if B doesn’t remarry – this makes it a contingent
remainder
(2) A to B for life, then if C is still alive, to C
(a) Something is a contingent remainder when there is a condition
precedent as in this case
(b) C only gets the estate if C outlives B
(c) Condition precedent b/c it says: you must satisfy this condition
before you get the property AND b/c of the word order – “then, if C
is still alive” (condition) precedes the “to C” (remainder) – condition
is stated before the remainder
(3) A to B for life, then to B’s kids (B is 3 years old)
(a) Grant to a category is a contingent remainder
(b) Grant is to an ascertained person
(c) B has a life estate
(d) B’s kids have a remainder
(e) As soon as a child is born, it becomes a vested remainder subject to
open
(4) A to B for life, then to D’s 2003 graduating class
(a) Unascertained category – they’re all living people but it’s unclear as
to the details of the category
(b) ex: A to B for life, then to the three closest living relatives who are
currently alive when B dies – we don’t know who those relatives are
until B dies (the category is unascertained)
c) Two ways contingent remainder are destroyed
(1) Remainder not vested before the life estate ends
(a) ex: A to B for life, then to D’s 2003 graduating class
1.) if B dies today, then D’s 2003 graduating class can’t take the
estate b/c they couldn’t immediately accept the estate upon B’s
death
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2.) Estate reverts back to A (unstated reversion)
(2) If A sells or transfers the unstated reversion to B (so that B now owns the
reversion and the life estate) – destroyed by merger
(a) Common law says B now owns fee simple absolute and that when
you have both of these together, you destroy any contingent
remainders on the estate (D’s 2003 graduating class won’t get the
remainder)
f.
RULE IN SHELLY’S CASE
1) If the remainder is created in the heirs of the life tenant, it becomes a fee simple
absolute in the life tenant.
*Court says its better not to create a contingent remainder . . . the court rewrote
to create a fee simple absolute.
2) ex: O to A for life, remainder to A’s heirs
a) If A sells to X, when A dies, A’s heirs get it back because A had a life estate
b) Looks like a contingent remainder – but it’s actually a fee simple absolute in
A and not to A’s heirs – A can give his property to whoever he wants and the
estate doesn’t have to go to A’s heirs; the estate goes to A’s heirs upon his
death
c) The only people that are your actual heirs are the people who will inherit
from you the day you die (my heirs today may be different from my heirs the
day I die – this is why this rule creates a fee simple absolute)
d) Rule says this is the same as saying “to A and his heirs” to avoid inheritance
taxes
e) Only a handful of states still follow this rule, but the courts have not made
the rules Retroactive
g. DOCTRINE OF WORTHIER TITLE
1) Says that your property is better if you inherit it rather than receive it as part of a
grant
2) ex: O to A for life, remainder to O’s heirs
a) Court says that this becomes “O to A for life, reversion to O”
(1) O’s heirs take nothing from O
(2) Doctrine says that where you have a remainder to the grantor’s heirs, that
remainder becomes a reversion to the grantor
3) Only half the states have abolished this doctrine
h. RULE AGAINST PERPETUITIES
1) Generally
a) Purpose: Limiting the dead hand control; purpose of the Rule limits how
long you can tie up land through dead.
b) RULE: no interest is good unless it must vest if at all no later than 21 years
after the death of some life in being at the creation of the interest (use death
of last measuring life)
c) APPLIES TO THIRD PARTY INTERESTS:
(1) Executory interests
(2) Contingent remainders
(3) Vested remainders subject to open (half of the states)
(4) Options to purchase not in leases – these are tested for validity under this
rule
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(a) If part of the lease – if exercisable only during the lease term, not
subject to rule
(5) Rights of refusal –a form of equitable future interest held by a 3rd party.
-if you own a condo and want to sell it, the owner of the building can buy
it even if you already have a buyer
(6) Powers of appointment
2) Definition of RAP broken down:
a) Who are lives in being?
(1) Only live human beings, people who are alive the moment the document
is effective; pets, government entities and corporations don’t apply
(2) E.x: A to B for life, then to C until all current residents of Essex County
are dead, then if she is still alive, to D
(a) If we’re in a state that says lives that are referred to in a grant are
lives in being, that state probably won’t recognize all the residents of
Essex County
b) Lives in being plus 21 years
(1) ex: A to B for life, then to C for life, then if she is still alive, to D
(a) D has a contingent remainder – it absolutely vests in D immediately
after C dies
(2) Ex: A to B for life, then to C for life, then if she is still alive to D – 21
years after C dies, to D
(a) must vest 21 years after C dies or else it reverts back to A
(3) ex: A to B for 21 years, then to my then living children, then to my
surviving grandchildren
(a) this is a contingent remainder that is valid under RAP
(b) it’s valid b/c it’s an open class today – it won’t remain open 21 years
from now
(4) ex: A to B for life; then to C for life; then to E after C’s death; but if she
is alive when C dies, to D 22 years after C’s death
(a) D’s contingent remainder must vest, if at all, immediately upon C’s
death, since D either is alive when C dies or isn’t alive then
(b) At that point, D has an absolutely vested remainder, which has
vested w/in the allowed period of “lives in being plus 21 years” b/c it
vested when C died and D was still alive
(c) The remainder to D is valid
(d) Remainders to C and E are vested immediately upon created
(assuming they are alive)
3) When does an interest become vested?
a) Something becomes vested for RAP when:
(1) All conditions precedent have been met (i.e. all contingent remainders
have become vested)
(2) Taker is alive and ascertained
(3) Where there’s a gift to a class, we know exactly what the percentage is to
each class member
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4) Three rules we have to follow when applying RAP:
a) Unborn widow rule
(1) ex: A to B for life, then to B’s widow for life, then to B’s surviving
children – B is currently married to W; B currently has 3 children alive
(a) FI: B’s surviving children have a contingent remainder – their
remainder depends upon B’s children outliving B’s widow; reversion
to A
(b) We won’t know who B’s surviving children are until B and B’s
widow die; it’s possible that someone may live over 21 years before
B’s surviving children are identified – thus making it invalid under
the rule
(c) B’s widow doesn’t mean W – it means whoever is married to B the
day B dies
b) Fertile octogenarian
(1) ex: A to B’s children for life, then to A’s surviving issue (closest
surviving generation to A) when B’s children die
(a) Facts: B is 80 – has 3 kids: 60, 57, 49 years old
(b) There is a gift to A’s surviving issue
(c) FI: A’s surviving issue have a contingent remainder (it’s dependent
upon B’s children dying)
(d) Lives in being are B’s children
(2) Many states have enacted a “rule of reason” – it will take into account
vows of chastity, how long it’s been since you’ve had a child, your age
(courts will presume you are capable of having children if you’re
between 13-65)
c) All or nothing rule
(1) If it’s a gift to a class of people, we have to know every person w/in the
time period; if there’s someone who can enter the group more than 21
years after, then the gift is void to the entire class of people
(2) ex: A to B for life, then to B’s children who reach age 25
(a) Two fact situations:
1.) B has 3 children – ages 3-10
2.) B has 3 children – one being over 25
(b) In both situations, these contingent remainders are void b/c B can
have another child 21 years after all three children reach 25
5) Modifications/opt out
a) Reformation Act (Uniform Rule Against Perpetutities)
b) Rule of reason/cy pres doctrine – be reasonable in your interpretation
(1) Remedy for violating RAP: strike/cross out offending language (i.e.
reduce age from 25 to 21 – cy pres)
c) Wait and see
(1) There’s no reason to invalidate things just b/c a violation could invalidate
things later on – wait and see if it works out
(2) cts won’t hold that a FI violates the rule until the perpetuities period (any
property interest that can theoretically last a long time – e.g. FSA is a
perp but it doesn’t apply to FSA) has passed and they’re certain that the
FI hasn’t vested w/in that period
(3) ex: under unborn widow rule: let’s wait and see who B gets married to
and see if she was a life in being at the time (was she born at least)
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(4) ex: under fertile ocogenarian rule: tell us every few years if he has more
children – then we keep taking it into account when we reanalyze them,
even though it may take a long time for this
(5) ex: O to A so long as used for residential purposes, then to B
(a) Wait until O, A, B die
(b) If property used for nonresidential purposes before 21 year period
lapses, executory interest in B is good and will be recognized and
property shifts to B
(c) But if still used for residential purposes, B’s (actually B’s heirs)
future interest is destroy and owner of A’s interest has a fee simple
6) What happens when RAP is violated
a) Contingent remainder – replaced by an unstated reversion
b) Vested remainder subject to open – replaced by invented unstated reversion
(any remainder will be replaced by some sort of unstated reversion
c) Executory interest – depends on jurisdiction you are in
(1) English rule: last vested interest is fee simple absolute
(a) To B for life, then if a comet hits this earth, D will cut short any
present interest
(b) English say that everything after “C for life” will be void and will
create a life state in C
(2) American rule: create future interest in grantor
d) Power of appointment – gone
e) Right of first refusal – gone
f) Option not in the lease – gone
i.
RESTRAINTS ON ALIENATION
Attempts of an owner to maintain control over the activities of those who own the
property.
*Promotes equality (prevents racial restrictions)
*Promote efficiency
*Promote liberty by freeing
1) Deals w/vested in interest and vested in possession
2) Three types of restraints:
a) Forfeiture
*If the control is on the ability to sell land, then it is considered a forfeiture.
(1) Condition that says if you do X or don’t do X, you will lose the property
(2) ex: A to B and his heirs, but if B tries to sell before 2010, back to A
(a) If it’s a forfeiture restraint, then the condition disappears, B has it as
a fee simple absolute
(3) Conditions that say that you can’t do something, these kinds of
conditions are always going to be invalid today if it’s a forfeiture
restraint (B has fee simple absolute)
b) Disabling
*Prevents the owner from exercising a power they would otherwise have (but it
does not take title away)
(1) Condition that says you can’ t do something that you normally have the
power to do as the owner of the land
(2) “O to A for life, but for 10 years A cannot sell” – courts almost always
find void
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c) Promissory
*Promise by purchaser/borrower to the lender/seller not to take any . . .
(1) A restraint where you promise to do something
(2) Most common kind of promise: land sale contracts – ex: buyer may not
transfer buyer’s right to transfer to a third party – valid promissory
restraint; a right of first refusal in deed of a condo – valid promissory
restraint; mortgage – valid
C. Common Ownership of Property
1. SITUATION OF WOMEN UNDER COMMON LAW
a. Unmarried women were treated the same way a man was treated; EXCEPT: she
couldn’t inherit fee simple absolute
b. If there are no sons in a family; all the daughters would inherit in coparceny; once
she got married, her portion would become separate and her husband would have
control of the property
c. Immediately upon marriage, a woman ceased to be owner of all her property – her
husband owned all of her property
1. jure uxoris – if a woman is given property from her brother or father, this gives
husband control of the wife’s property as a life estate for the life of the marriage;
if divorced, the property goes back to the brother/father
d. curtesy right – when a child is born, the child has a complete life estate; if no
children are born or if she dies, the husband retains the land – it doesn’t go back to
the grantor; this was unwaivable (woman couldn’t sign over her rights to her
husband)
e. married women weren’t allowed to own their own business; if she earned anything,
her husband would get it; she couldn’t file her own lawsuits
1. dower rights – woman had 1/3 interest in all real property owned by the husband
during the marriage regardless of what form of ownership he had; this was
waivable – a woman could sign a document that says she gives up her dower
rights to her husband
2. TENANCY IN COMMON
a. two or more people own a piece of property together
b. IMPORTANT: everybody has an undivided right of possession of the whole (every
tenant in common has a right to use any part of that land)
c. Doesn’t require that there be any kind of equal ownership in the property
d. Tenants in common have a right to contract to define the property (who gets to use
what part of the property)
e. Descendable: person can alienate (convey, sell interest)
f. Right to possession of undivided whole (unless co-tenants agree otherwise by K)
g. When a tenant in common dies, his interest goes to his devisees under his will or to
his heirs under state intestacy statute
3. JOINT TENANCY
a. there is an implicit survivorship right associated w/this – if one joint tenant dies, the
other tenant inherits that property – as long as there hasn’t been a severance
b. not descendable (can’t alienate it or it’s destroyed)
c. need for unities:
1) title: has to be in the same titled document
2) time: must be joint tenants at the same time
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d.
e.
f.
g.
h.
FALL 2001
3) interest: you have to have exactly the same property interest (A and B have to
both have life estates, fee simple absolute, etc.)
4) possession: undivided right of possession in property – each joint tenant has right
touse and enjoy the entire property
severance
1) right of survivorship highly contingent since a joint tenant who transfers her
property interest can destroy the right of survivorship of her fellow tenants
2) severance occurs only between the selling owner and the remaining owners,
doesn’t change relations of remaining owners among themselves
key differences/ similarities between joint tenancies and tenancies in common:
1) differences:
a) tenancy in common can own different shares; joint tenancy must own equal
shares
2) similarities:
a) both called concurrent tenant
b) both can sell land w/o permission (exception if there is an independent K
for which the parties agree they will not sell the land, but most states hold
that those are unenforceable restraints on alienation
c) both have the same undivided right of possession
example: A, B, C are joint tenants; A decides to sell to Z – this is allowed b/c there
are no limits on sale or transfer of land; Z is a tenant in common w/B&C, not a joint
tenant; A’s survivorship right disappears; B dies – has a will that leaves his property
to his spouse S; B’s share goes to C; Z still owns 1/3; S doesn’t get anything; C owns
2/3; C and Z are tenants in common; prior to B’s death, C was tenant in common w/Z
and joint tenant w/B
joint tenancy survives a lease but a lease doesn’t survive a joint tenancy b/c once
lessor dies, lessee can be booted out (lessor can only lease what she has so if dead,
she has nothing) – lease doesn’t create a severance
alternate contingent remainders: O --> A and B as life tenants, w/a remainder in A
if A survives B and a remainder in B if B survives A; whoever dies second obtains
the remainder and the property in fee simple absolute; a conveyance of A’s life estate
won’t destroy the contingent remainder
4. TENANCY IN COMMON WITH RIGHT OF SURVIVORSHIP
a. concurrent life estates w/alternate contingent remedies – this was created to have an
unseverable right in ownership
b. right of survivorship creates an alternate contingent remainder
c. ex: A and B have tenancy in common w/right of survivorship; A owns the present
estate which looks like the life estate – and a contingent remainder (if A dies, then B
gets all of A’s property and vice versa)
d. this is a form of non-severable right of survivorship – ex: A sells whole property to
Z; Z is buying A’s contingent remainder and A’s property – if B dies, Z will get the
entire property; if A dies, A’s entire property is wiped out and B gets everything
5. TENANCY BY THE ENTIRETY
a. joint tenancy (need all four unities: title, time interest, possession) plus marriage
b. COMMON LAW: this used to be the only way married couples could have tenancy
(majority of states now say that this doesn’t exist anymore)
c. one party can’t alienate his interest w/o other’s consent
d. property can’t be partitioned except through divorce proceeding
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e. creditors can’t attach property held through tenancy by the entirety to satisfy debts of
one of the spouses
f. in some states, Married Woman’s Property Act abolishes tenancy by entirety created
b/c women didn’t use to be able to own property on their own, but not so anymore
g. has a survivorship right (if husband dies, wife gets sole ownership of property and
vice versa – if husband leaves land to kids, it wouldn’t take effect until wife died)
h. unseverable survivorship right – you can’t destroy the survivorship right (unlike
joint tenancy) – if A & B have tenancy, and A sells to Z, when A dies, Z still owns
the tenancy right (under joint tenancy, B would get all the rights and Z wouldn’t get
right he bought from A)
i. under COMMON LAW, men controlled the tenancy right – some states abolished
this and established equality between husband and wife’s right to tenancy
j. GETTING OUT OF THE TENANCY BY THE ENTIRETY: the couple can transfer
the homestead to another couple; can transfer it to an attorney who will then transfer
it back to them as joint tenancy – in some states, the moment a divorce is final, the
property becomes a joint tenancy or a tenancy in common
6. ALL COMMON OWNERSHIP
a. sharing the benefits of ownership
1) if one co-owner chooses not to live there, tenant in possession has no duty to pay
rent b/c possessory tenant doing what she has right to do (possession of entire
whole)
2) there is a duty to pay rent to co-owners if they ousted them (wrongfully excludes
others from jointly owned property
3) common law said that whoever collects rent owns the property
4) every state says that you get a share of the rent collected by a third party based on
your percentage of ownership
(a) co-tenant has right to lease his interest w/o other’s consent
(b) lessee obtains lessor’s rights, including right to possess entire parcel
(c) co-tenants have right to share rent only if they agree to be bound by
leasehold
5) joint tenants and tenants in common can create an agreement as to the amount of
rent shared
(a) ex: A and B are co-tenants; A agrees to lease the apt to someone and B also
agrees to lease to someone; the first agreement would win b/c both have the
right to lease
b. sharing the burdens of ownership
1) co-owners have duty to share maintenance expenses in accordance w/their shares
(a) cts look at what are necessary repairs – all co-tenants have to share in the
cost
(b) if one co wants something in particular, cts typically will not have everyone
share in the cost
2) mortgages and taxes (things that are recurring from the outside world)
(a) all co’s have to pay their share, depending on their percentage of ownership
(b) if one co doesn’t pay, then the other co’s can collect; if you overpaid, then
you can get compensated
3) they have no duty to share costs of major improvements, such as adding a new
room – unless they agree to it beforehand
(a) if one co wants to make a capital improvement, that co has no right to collect
from the others unless there was an agreement prior to the improvement
(b) what if the co does improvement anyway?
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(1) in some states, the co’s won’t have to pay
(2) in others, the co’s will get ownership and will have to share in the
payments
4) co-owner who exclusively possesses premises must bear entire burden of
expenses if the value of her occupation of the premises exceeds those payments
c. ouster
1) tenant in possession has to pay to the tenant who isn’t in possession
2) in some states, ouster has to take the physical form (verbal)
3) co-tenants can’t obtain AP against each other unless possessing tenant makes
clear to the non-possessory tenant that he is asserting full ownership rights in the
property to the exclusion of the other co-tenants
4) cts require affirmative act by which non-possessory tenant is put on notice that
co-owner claiming adversely to non-possessory tenant’s interest (mere collection
of unshared rent isn’t sufficient)
5) the party in possession has to pay the party out of possession (any rents that are
due)
(a) physical – actually change locks or take someone off property
(b) Constructive ouster: property is too small to be physically occupied by all
co-owners
(1) a duty to pay rent to tenant in possession
(2) amt of rent = fractional share of rental value owned by co-owners out of
possession
(c) superouster – if co-tenants, has to be an explicit claim of ownership w/
formal notification to other co’s
(d) AP: cotenant may begin AP if superouster hostiley occupies property, but
other co can simply enter property and assert that co is violating his
cotenancy right
d. partition
1) any co has right to seek partition (breaking co-tenancy)
2) joint tenants to tenants in common can file suit for judicial partition of commonly
held property and ct may order property physically divided among the co-owners
3) if this isn’t feasible or inappropriate, ct may order property to be sold and $
divided, however this is bad b/c you almost never get the full value of the
property
4) co-owners may agree among themselves to partition the property (voluntary
partition)
7. CONDOMINIUM
a. every state has a basic statute that governs this formation
b. form of ownership where you own a cube of air, depending on how high above the
ground of the property
1) don’t necessarily have to have an apt there, only a cube
2) fee simple absolute of the cube
3) tenant in common in all the common spaces of the property
4) unseverable tenancy in common – can’t sever your space from the common areas
– when you sell, you must sell everything together (the cube and the tenancy in
common – common areas)
c. issues arise when condo assoc has right of first refusal
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1) restrictions on owner’s right to transfer property are recognized as a valid means
of insuring the association’s ability to control the composition of the condo as a
whole
2) seller still decides when to alienate and gets fair market value (when seller knows
she’ll get fair market value no matter what – more incentive to improve property
as opposed to when assoc gets first refusal at a fixed price)
3) assoc can’t discriminate based on race, sex, marital status, ethnicity, etc
8. COOPERATIVE
a. you don’t own sole ownership of your apt – you own a share in the cooperative corp
b. your share allows you to lease that particular apt
c. you are both owner and tenant
d. your voting rights are determined by your share of the corp
e. the owner of a share has a right to a particular apt and no other apt (can’t choose
which apt either)
f. there’s one tax bill, one blanket mortgage for the entire building
g. the mortgage must be paid in full – many cooperatives went bankrupt b/c some
tenants couldn’t pay – once mortgage is paid, all people in co-op become tenants in
common
h. issues w/co-ops:
1) rights of first refusal – challenged by common law restriction
2) right to approve leases – challenged by local govt statutes
3) leasing bans – challenged by association rules
II.
LANDLORD-TENANT RELATIONS
A. LEASEHOLD ESTATES (non-freehold estates – you have to have a lease to hold the
property)
1. Types of tenancies
a. Term for years
1) a lease that has a specific starting date and a specific ending date
2) doesn’t require that a lease last for a year, but usually will last for a set term
(usually one year)
3) no requirement of notice to terminate the lease – term automatically ends on the
last day specified on the lease; if it isn’t renewed, there’s no obligation to tell the
tenant nor is the resident required to tell the landlord
4) b/c the statute of frauds says that all leases longer than one year must be in
writing, a written lease is required for leases for more than one year; oral leases
for a year or less are binding in these states
b. periodic tenancy
1) a tenancy which automatically renews itself unless notice is given
2) most common form is the month to month tenancy
3) common law required one full period for notice (if you have a month to month
notice, you have to give one month’s notice)
4) in a year to year tenancy, common law said you’d have to give a full year notice
– common law said that notice on 12/31 was too early and notice on 1/2 was too
late; today, this no longer is true (in year to year, most states have reduced to 3 or
6 months notice)
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5) if you have a year’s lease, common law said that if you hold over for a day, then
you’re required to stay for another year, however cts in all states have changed
this – if you hold over for a day, then it becomes a periodic month to month lease
c. tenancy at will
1) almost doesn’t exist anymore
2) i.e. you’re negotiating a lease and you agree that the tenant can go onto the
property during the time of the negotiations, however the negotiations never
come to a close
a) technically, the tenant could go onto the property – there’s no beginning date
and no ending date; the tenant can’t be charged w/trespass
b) landlord can use self-help (personally removing the tenant) in evicting a
tenant at will; periodic tenants or tenancy for years – eviction must be done
by the sheriff or through the courts
c) today, the Uniform Residential Landlord-Tenant Act (URLTA) rquires
one month’s notice and rent paid month to month (periodic) –NJ requires 3
months
d. tenancy at sufferance
1) not really a tenancy – actually a limbo period due to tenant hold over
2) gives the landlord an option as to what to do
3) landlord can accept your hold-over and bind you for another period or can begin
to evict you
2. Landlord’s obligations to tenant
a. give physical possession at start
1) majority of states say yes, but a minority of states follow the American rule
2) American Rule: all the tenant has to do is give the right to possession and let the
new tenant deal w/it
3) British rule: landlord has to give actual physical possession of the land at the
start of the lease – landlord at risk in this situation
4) URLTA – if landlord can’t give physical possession, the tenant has the option of
terminating the lease and getting damages from the landlord
5) Must deliver at beginning of leasehold
6) If prior tenant wrongfully holds over after lease expires, L obligated to remove
him w/in reasonable time
7) Failure to deliver actual possession to new tenant is a breach
8) Tenant who was shut out can either terminate lease and get damages for having
to find another place to live, or affirm the lease, w/hold rent for period he
couldn’t occupy, and recover damages for cost of temporarily getting another
place
b. protect tenant from third party
1) ex: a third party comes in and says that he’s going to live w/you now – landlord
has not duty to protect unless there’s a specific clause in the lease
3. covenant of quiet enjoyment
a. says that no one w/superior title (landlord, his agents) will interfere w/your rights as
tenant (implied in all leases)
b. critical question is if L has legal interest in bldg or apt that’s creating a nuisance – if
so, T who’s bothered has action against L b/c nuisance w/in his control
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4. fitness of premises
a. landlord under common law gave no implied warranty of fitness that the premises
was fit for a specific purpose – you are liable for the damages that you cause (that
you thought you could use the premises for – ex: you thought you could put a 50 ton
item on the floor, but the floor caves in)
b. exceptions: short term lease for house – implied that it is fit to live in for that term;
situation where the building has not yet been completed –
1) where landlord says that you can use this space as offices (tenant had no
opportunity to confirm the premises)
2) there’s a latent defect known to the landlord that could not be determined at
inspection
c. covenant of fitness can be drafted to guarantee it, but w/o it, there is no implied
covenant
5. interpretation of leases
a. leases were interpreted according to property law instead of contract law
b. cts held that all clauses were independent of each other
c. first dependent clause:
1) duty to pay rent
2) right to possession
3) in addition, clauses that are bargained for are
B. EVICTION
1. Act of L that violates the lease covenant dependant to the obligations of the tenant
2. two kinds of eviction:
a. actual – literally, the landlord coming in and physically throwing you out – physical
interference w/the tenant’s right to possession
1) total eviction – landlord gathers you and your stuff and throws you out
a) tenant has no additional obligation to the landlord, lease is broken
b) tenant can collect damages for the evictions, wrongful eviction
2) partial eviction – where the landlord takes over part of the premises; if there’s
partial eviction, the tenant has no duty to pay rent, however the duty isn’t
relieved of any other obligations the tenant may have under the lease; about a 1/3
of the states still follow this rule; most states have changed this rule and now say
that rent will be reduced by a certain percentage – if there’s a de minimus
eviction (ex: six inches out of 50 feet) then the ct probably won’t give you
damages
b. constructive
1) an act by the L that indirectly jeopardizes the tenant’s use of the property (ex: L
stored dynamite in the apt; L didn’t repair the roof, so there was flooding every
time there was rain – L didn’t physically evict, but was allowing conditions to
occur that was disrupting the tenant’s use of the property)
a) total – condition is such that you have to leave the property, the tenant must
move in order to claim that there has been a total constructive eviction and
the tenant must move promptly otherwise you waive your total constructive
eviction claim; where there is a total constructive eviction, the lease is
cancelled, however if the tenant moves out before the ct has rendered it
decision, the tenant is moving at his/her own risk b/c if ct rules that it isn’t a
total constructive eviction, then the tenant is still bound to the lease
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b) partial (only a few jurisdictions) – ex: in NYC, tenant leased an apt in a
luxury apt building that has a terrace, there’s central air for the whole unit
that leaked green fluid onto tenant’s terrace; tenants claim that they’ve been
pushed out of their terrace area; tenants claimed that they should have to pay
any rent at all; this was the first recognition of a partial constructive eviction
(no free rent, but rent abatement)
3. Landlord’s remedies
a. can evict when obligations are not fulfilled
b. has right to summary eviction procedure (fairly quick – can get a hearing in a
week and T leaves property a week or two after decision)
1) where it is for non-payment of rent some states L has to give notice (not in NJ)
c. L could use ejectment, but could take 3 to 5 years
d. L could sue on a covenant issue, but problem in the amount of time it takes
e. L could refuse to renew a lease or terminate it
C. LANDLORD’S DUTY TO MITIGATE
1. accept the offer to surrender – this terminates the lease and the landlord has no rights to
rent or anything prospectively
a. want to do this if you can rent to someone else more desirable or at a higher rate
b. absolve tenant’s responsibility for remaining rent
c. tenant must pay back rent
d. landlord may also sue for damages for estimate landlord lost b/c of tenant’s failure to
perform (i.e. cost of finding replacement)
2. L mitigating: L can refuse to accept, but relets for the tenant’s account – “no you’re still
bound, but I’ll try to see if I can find someone for the remaining time – if we find
someone, then we’ll treat it as a sublet, however if we can’t find anyone, then you’re still
bound” – L has to be very careful – in order to relet, the L has to repaint, etc – this can
look like an acceptance of surrender – L has to be very explicit (make it in writing)
a. when new tenant is found, L can sue tenant for difference between old rental price
and new rent, if new rent lower (new rent must be reasonable)
b. it matters whether or not L accepts surrender b/c if tenant moves out after 6 months
and new tenant has month-month tenancy and leaves after 4 months, and L accepts 1st
tenant’s surrender, L can’t sue original tenant for last 2 months of rent (if L didn’t
accept surrender, tenant obligated to pay for last 2 months)
3. sit and wait: L does nothing (in some states, this is still allowed) – wait and sue for the
rent at the end of the lease term v. mitigate damages
a. traditional rule: L may do nothing and wait for end of term and sue for back rent
b. to sue tenant immediately for $ compensation in middle of lease term, L must ask for
damages (rental price-fair mkt price); to sue for entire rent itself, L must wait until
term ends
c. most states reject this: they now apply doctrine that requires L to mitigate damages
1) by waiting for unpaid rent to accumulate, L increased damages that could’ve
been avoided by getting another tenant
2) L must act reasonably in finding another tenant (ads, announcements, whatever L
normally does to sublet/lease is considered mitigation – L may have to incur
expenses – if L has to do this, the L can add those expenses to the amt T has to
pay)
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3) If L fails to mitigate, the amt of damages reduced by amt that would have been
avoided had the landlord mitigated
4. Three ways to deal w/ holdover tenant
a. self-help: L himself throws you out – most states don’t allow it
b. eviction: use ct proceeding to get tenant out
c. acquiescence: accept rent and let person stay
5. Either L or T may transfer their interest in the property
a. if L transfers interest: T’s leasehold survives
1) new owner may terminate month-month lease by notice
2) but if T has 6 month on lease left, new owner takes property subject to remaining
6 month possessory right in the tenant
b. T’s right to assign or sublet
1) lease may be silent on question of whether T has a right to assign/sublet or
sometimes lease provides for it only w/L’s consent
2) if lease silent, T can still transfer leasehold
3) partial restraints on alienation of leaseholds and condos upheld by cts, even
though this isn’t so on alienation of fee simple interests
4) landlord may only deny lessee right to sublet/assign if commercially
unreasonable – factors to consider:
(a) financial responsibility of proposed assignee
(b) suitability of the use for the particular property
(c) legality of the proposed use
(d) need for alteration of the premises
(e) nature of the occupancy (i.e. factory, clinic)
5) ASSIGN: conveys all T’s remaining property interests w/o retaining any future
rights to enter the property
a) new T (assignee) is responsible directly to L for all undertakings under the
original lease (i.e. all tenant’s covenants, including cover to pay rent, run
w/the land)
b) but L can sue either T or assignee for rent
c) cts use concept of privity of estate to explain why assignee directly liable to
L
d) L and assignee aren’t in privity of K since they didn’t reach an agreement
w/each other
6) SUBLEASE: tenant retains some future interest or the right to control the
property in the future
a) covenants of original lease don’t run w/the land
b) L can’t sue the subtenant to enforce covenants in original lease, including
covenant to pay rent
c) Only exception is when subtenant expressly promises the T to pay the rent to
the L – then the L may be able to sue the subtenant as 3rd party beneficiary
of the K between the T and the subtenant (in either case, if L sues T for rent,
T has right to be reimbursed by assignee/subtenant)
D. TENANT’S RIGHT TO HABITABLE PREMISES
1. IMPLIED WARRANTY OF HABITABILITY
a. Minimum set of conditions that the L must provide at the beginning, during and end
of the lease term
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b. Common law said that L had no duty to repair unless there was an express clause that
said so, however L now has a duty to repair
c. L is cheapest cost avoider so he should bear the burden (he’s in business of renting
and fixing apts)
d. violation of housing codes is a breach of warranty of habitability
e. T has a private right of action for violation of code so more enforcement of rule than
if only city could sue (i.e. T’s pay same rent, so landlord should deep up
maintenance, etc) – violation of code can’t be de minimus (of small, unimportant
matters)
f. things that would be included: structural soundness (walls, ceilings, floors, windows);
heat (a/c depends on where you live); water and plumbing (has to have some sort of
potable drinking water, have to have hot water, bathroom, electricity, free from
vermin/mice, security, smoke detectors)
g. who is protected
1) T and T’s family who live there
2) Neighbors
3) Business invitees
4) Social invitees
5) trespassers
6) passerby
h. how can the T use?
1) defense to eviction action
a) no rent is due
b) some rent is due – don’t evict now (if tenant says I’ll pay, then T gets time
and only if the T fails to pay after a certain time period, will he get evicted)
2) justified to w/hold rent
a) put rent into an escrow account
3) end lease
4) affirmative lawsuit – damages, T recover rent
5) repair and deduct
6) get administrative remedy
i. is it waveable?
1) some state have rules w/waivers: have to be a certain font, clear language, etc
2) some states allow waivers, but these even have limitations as to the conditions of
the waiver
j. how can L defend against lawsuits?
1) T caused the damage to the property – the L is not responsible for these type of
damages
2) L can’t defend on “normal wear and tear” – this, the L is responsible for
3) Some sort of act of God defense – a natural disaster caused the damage
4) No such condition
5) It’s repaired – if T has pictures, the L can show what has already been repaired
right before the lawsuit
6) L can say “we’re working on it” (repairs underway)
7) No notice – someone has to tell the L about the problem – most states require the
T to notify the L about the problem; some states say the L has an affirmative duty
to repair and check on the condition of the apts
8) Not a violation (even though I may have chosen an ugly paint color – the implied
warranty of habitability doesn’t require me to use a nice color)
m. Should the warranty apply to commercial leasing?
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1) Most states have rejected it for commercial leasing, but some have decided to
apply it to commercial leasing and residential leasing
2. Retaliatory eviction
a. if you’re going to create a group of rights for the Ts, you need to be able to protect
the Ts when they exercise their rights
b. basic protections: (a L can’t retaliate if a T complains to the following)
1) complaint to governmental agencies
2) tenant organizations
3) complaints to L
4) exercising other rights and remedies
5) talk to tenants or prospective tenants, press, community
6) testimony (for other tenants)
c. presumption (any act taken by the L is considered retaliation if taken w/in a certain
amt of time – in many states 1 year)
d. actions that are considered retaliation:
1) a refusal to renew
2) raise the rent; elimination of service
3) give a notice to terminate and evict (most common)
e. how does the retaliatory eviction process work?
1) T raises the claim as an affirmative defense by showing that T did one of the
above actions and that T did it before L’s retaliatory eviction
2) L tries to establish that it wasn’t a retaliatory eviction (valid business justification
for the action L has taken)
3) T has to show that L’s justification isn’t the real reason
4) The burden of proving that it’s an improper eviction is on the tenant
E. Rent Control
1. a mechanism for determining the amt by which Ls subject to it may increase the annual
rent
a. can only increase rent beyond the base rent for amt necessary for L to get a “fair
return” (depends on L’s increased costs, etc)
b. limit L’s rights to refuse to renew a T’s lease
c. w/a Rent Control ordinance, L has to petition to increase rent
d. L has to petition to evict a tenant
2. buildings/units subject to it by municipalities (involuntary participation) – anyone can
live in these buildings
3. increase availability of housing b/c makes previously unaffordable housing affordable
a. L’s don’t like this b/c they feel it is a taking of their property w/o just compensation
4. Want to know who will be beneficiaries of program if thinking of setting it up b/c it’s
ineffective if beneficiaries are the rich who could already afford housing (i.e. is the target
class – the poor – the ones that end up benefiting?)
5. Argument that rent control inefficient is based on notion that in an “unregulated mkt,”
rent and quality of housing provided will be determined by interaction of supply and
demand and interfering w/the mkt price of housing by setting it at an artificially low level
will cause a housing shortage
6. People living w/person on rent controlled lease (i.e. gay partner) get benefit of rent
control after lessee dies
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