Ownership and Leasing of Real Property
18.1
Real Property
 Real property--Rights and interests in land,
buildings, and fixtures
 Fixtures—any piece of personal property
permanently attached to a foundation set
into the land
 Trade fixtures—fixtures that retain identity as
personal property,
 Example: oven screwed to floor in pizza place
Real Property Rights
 Surface Rights
 Rights to the air space above the land
 Mineral rights
 Water rights
 Surface rights—right to occupy the land,
develop it with buildings, and fixtures, and
even to lay waste to it by destroying its
resources such as timber or water
 Right to air space—the air space above the
surface of the land is also part of the realty
and you are granted ownership
 Mineral rights-the right to dig or mine the
earth beneath the surface
 Solid minerals—coal, iron, ore, nickel, and
uranium
 Fluid-oil, natural gas , vapor
 Doctrine of capture—grants ownership of these fluid
minerals to the party who extracts or captures them
 Example: if a person drilled an oil well on a quarter
acre lot and began pumping oil that extended 25 acres,
all the oil could be removed under this doctrine
 Water rights—control of the water on the
surface or under the ground
 Control of water rights is governed by
individual states
 Regulations of water use
 Riparian—someone who owns land abutting a body
of water
 Prior appropriation system—grants the first party to
use the water source priority in subsequent years
over other potential users
Limitations of Ownership
 Easements
 Restrictive covenants
 Zoning ordinances
 Duties owned to entrants on land
Easements
 Easement—irrevocable rights to some limited
use of another’s land
 Easement Appurtenant—easement given to
neighboring landowner, benefits neighbor’s land
 Easements in Gross—benefit a person (non neighbor)
or business
 Easement by Necessity—when property owner must
cross another person’s land to access hir or her
property
 Easement by Prescription—when someone makes
systematic use of your property for a long period of
time, typically 15-21 years
Restrictive Covenants
 Restrictive covenants—a promise usually
made in writing by the buyer to the seller,
limits use of the land in some way
 Ex. Buyer may contract that they will not graze
sheep, if the buyer who gave the covenant resells,
the new owner is bound only if the covenant is the
kind that runs with the land.
Zoning Ordinances
 Zoning ordinances—regulate the location of
residential, business, and industrial districts
 Nonconforming use
 Spot zoning—treatment of a single property in a
manner inconsistent with the treatment of similar
properties in the area
 Variance-allows owner to make use of land
inconsistent with the general zoning ordinance
Duties Owed to Entrants on Land
 Trespass—unauthorized invasion of the private
property or premises of another
 Licensee-a person whom the possessor of real
property has permitted to be on the realty
 Public Invitee—a member of the public invited by
the land’s possessor to enter or remain on the
land for a public purpose
 Business Invitee—shopper or moviegoer
 Attractive Nuisance--if you create something
that attracts children to your property you are
required to make precautions against their injury
Forms of Real Property
Ownership
 Estate—bundle of ownership rights in, and
powers over, realty; also property of
deceased
 Conveyance—transfer of an estate from a
grantor to a grantee by a deed
 Grantor—party who transfers ownership powers
 Grantee—party who receives ownership
 3 types of Estates
 Fee simple absolute—an estate that conveys all
ownership rights and interests “greatest possible
bundle of rights and interests”
 Conditional estate—makes the ownership
conditional on some act or event “so long as…”
 Life estate-ownership only for the length of the
person’s life
 Non-freehold estate—tenancy, involves the
transfer of only certain rights, and interests
(typically possession and use)
Transfer of Ownership
 Ownership transferred by sale, gift,
inheritance
 Deed—legal document used to transfer ownership
of real property
 Quitclaim deed—transfers only whatever rights and
interests the grantor may have in the real property
 Warranty deed—protects the grantee by providing
several enforceable grantor’s warranties enforceable
against the grantor
 Adverse Possession
 Occurs when you adversely and exclusively
possess in an open and notorious way the land of
another private person
 Adverse—occupation is without the consent of the
owner
 Open and notorious—occupation must be visible to
the public, examples, fences, crops, barns
 Continuously—occupation is uninterrupted
 Dedication—act of giving real property to the
government for use as a park or roadway
 Eminent domain--Power of the government
to take private property for public use in
exchange for the fair market price
 Condemnation proceeding—a hearing to
determine fair compensation for the owner and
acquire ownership for the government