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87 Cards in this Set

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Duty to deliver: English rule (majority)
L must put T in actual possession of the premises.



(if, at the start of T's lease, a prior holdover T is still there, L has breached and new T gets damages)
Duty to deliver: American rule (small minority)
LL need not give T actual possession. Legal possession only.
Which is majority rule?
"English" –duty to deliver possession
Does the implied covenant of quiet enjoyment apply to Residential, Commercial, or both?
BOTH.


T has the right to quiet use and enjoyment of the premises without interference from LL.
2 ways the LL can breach the Implied Covenant by Quiet Enjoyment:
1. breach by actual wrongful conviction


2. breach by constructive eviction
Actual conviction occurs when:
LL wrongfully evicts or excludes T from premises
What is an example of breach by Constructive Eviction?
Every time it rains, X's apartment floods.
Elements of Constructive Eviction?
1. Substantial interference


2. Notice to LL


3. LL fails to fix


4. T vacates within reasonable time
Generally, the LL is NOT liable for acts of other tenants. Two exceptions:
1. LL must not permit a nuisance on site


2. LL must control common areas
Does the implied warranty of habitability apply to Residential, Commercial, or both?
Residential only
The implied warranty of habitability is NOT
waivable
What is the standard for the implied warranty of habitability?
Premises must be fit for basic dwelling. Bare living requirements must be met.
How can you apply the standard?
Housing Code or case law
3 types of problems that trigger a breach of implied warranty of habitability
1. no hot water


2. no plumbing


3. no running water
T's entitlement when the implied warranty of habitability is breached: [MR3]
M = Move out (does not have to)

R = Repair and deduct

R = reduce/withhold rent (place in escrow acct.)

R = remain + pay rent (seek $ damages)
T1 has 10 months remaining on a two–year term of years. T1transfers all 10 months to T2. This is...
an Assignment
As a result, L and T2 are....
in privity of estate (because T2 is in possession of the estate)
This means that L and T2 are liable for each other for all of the covenants in the original lease that
"run with the land"
What covenants run with the land?
1. promise to pay rent


2. paint the premises


3. repair
L and T2 are NOT in...
privity of contract (UNLESS T2 assumed all promises in the original lease)
L and T1 are ....
NO in privity of estate


ARE in privity of contract
This means that L and T1 are _____ liable to each other
secondarily liable
L leases Blackacre to T1. T1 assigns to T2. T2 assigns toT3. T3 then engages in flagrant abuse to the premises.Can L proceed against T3, the direct wrongdoer?

Yes.L and T3 are in privity of estate because T3 was in possession of the estate

Can L proceed against T1, the original tenant?
Yes, under privity of contract, T1 is secondarily liable to LL
Can LL proceed against T2?
No!! Privity of estate ENDED once T2 assigned to T3.


No privity of contract existed either (unless we saw that T2 has assumed all original promises, which the facts do not suggest)
Landlord's TORT liability under Common Law
"Caveat Lessee" (tenant beware)


^ LL under NO DUTY to make premises safe
5 exceptions to the harsh common law rule of Caveat Lessee:




[think when T learns of the exceptions, she CLAPS]
1. Common areas
2. Latent Defects
3. Assumption of Repairs
4. Public Use Rule
5. Short term lease of furnished dwelling
What common areas must LL maintain?
1. hallways


2. stairwells
What is the Latent defects rule?
LL must WARN tenant of hidden defects that LL knows or should know about


(NOTE: not a duty to repair; just duty to warn)
Assumption of repairs:
A LL who makes repairs VOLUNTARILY, will be liable for NEGLIGENT repairs
Public Use rule
LL who leases public space (such as a convention hall or museum) and who should know that, because of the nature of the defect + length of the lease, that T will NOT repair, is liable for any defects on the premises
Short term lease of furnished dwelling:
LL is liable for any defect on site


Ex. X rents a beautiful furnished bungalow on the beach for 2 weeks. LL is liable for any defect on site.
Define Easement
Grant of a nonpossessory property interest that entitles its holder to some form of use or enjoyment of another's land called a servient tenement
Easements can be affirmative or negative.



Define Affirmative easement:

Define Negative easement:
Affirmative = the right to do something on servient land


Negative = entitles its holder to prevent the servient landowner from doing something that would otherwise be permissible.
Negative easements are generally recognized in 4 categories:
1. light
2. air
3. support
4. stream water from an artificial flow
5. (minority: scenic view)
An easement is either appurtenant to land (relevant to land) or is held in gross. When is an easement appurtenant?
When it benefits its holder in his physical use or enjoyment of his property.
A grants B a right of way across A’s land, so that B canmore easily reach his land. B’s land is benefited by theeasement. In easement parlance, it is the dominanttenement. A’s land is serving B’s easement. It is theservient tenement. Notice that two parcels are involved.



Easement Appurtenant or Easement in Gross?
Appurtenant


(It takes "two" parcels. Dominant tenement gets benefit; servient tenement bears burden)
An easement is in gross if:
it confers upon its holder only some personalor pecuniary advantage that is not related to his use or enjoyment of hisland.
3 examples of Easements in Gross:
1. commercial company gets permission to put billboard on X's property


2. Utility company gets permission to place a power line on X's property


3. An individual gets the right to swim in your pond
Which passes automatically even if not mentioned in a conveyance?
Appurtenant easement


Easement in Gross IF for commercial purposes
What about the burden of the appurtenant easement?
Passes automatically with the servient estate UNLESS the new owner is (1) Bona fide purchaser; (2) without notice
4 ways to create an Affirmative Easement:
1. Prescription


2. Implication


3. Necessity


4. Grant
A owns two lots. Lot 1 is hooked up to a sewer drainlocated on lot 2. A sells lot 1 to B, with no mention of B’sright to continue to use the drain on A’s remaining lot 2.The court may nonetheless imply an easement on B’sbehalf if:
1. the previous use was apparent


and


2. the parties expected it would continue because it is reasonably necessary to the Dominant land's use and enjoyment
[[The 4 ways Affirmative Easements are Created: 1. Prescription 2. Implication 3. Necessity

4. Grant ]]How to create an Affirmative Easement by Prescription:

1. Continuous use for Statutory period


2. Open and notorious use


3. actual use (need NOT be exclusive)


4. Hostile (owner cannot give you permission)

Things to remember about the Prescriptive Easement:
1. It need NOT be exclusive use (you and the owner can both use the easement)


2. It must be Hostile! (the owner cannot give you permission even if he sees you do it!)
Termination of an Easement: [END CRAMP]
1. Estoppel
2. Necessity
3. Destruction of servient land (other than through willful conduct of servient owner)
4. Condemnation
5. Release
6. Abandonment
7. Merger
8. Prescription
Easements by necessity expire...
as soon as the need ends.
What is the exception?
If the Easement by Necessity was created by express grant, IT CONTINUES EVEN IF THE NEED ENDS!
Abandonment of an easement requires:
physical action by the easement holder
Merger doctrine: An easement is extinguished when...
title to the EASEMENT and title to the SERVIENT LAND become vested in the SAME PERSON
If the easement is merged and the property is later divided again, does the easement become revived?
NO.
How do you terminate an easement by Prescription?
Servient owner may extinguish the easement by interfering with it in accordance with the elements of Adverse Possession!


1. Continuous interference
2. Open and notorious
3. Actual
4. Hostile to the easement holder
Are licenses subject to the SOF?
NO––you do NOT need a writing to create a license
Neighbor A, talking by the fence with neighbor B, says,“B, you can have that right of way across my land.” This oral easement:

is UNenforceable because it violates SOF. This IS, however, a freely revocable license!SO if you see something that looks like an ORAL EASEMENT, it won't be an easement because it violates the SOF buttttt it will be a revocable license!

Estoppel will bar the revocation of a license IF
The licensee has invested substantial money, labor, or both in reasonable reliance on the license's continuation
Profits entitle the holder of a profit to...
enter servient land and take:


1. soil


2. some substance of the soil (minerals, timber, oil)
The PROFIT shares:
ALL the easement rules.



^Even though this is NOT AN EASEMENT, you use all the easement rules, but call it a profit
What is a covenant?
The covenant is a promise to do or not do something related to land.



It is UNLIKE the easement because it is not the grant of a property interest, butrather a CONTRACT or promise regarding land.
Why Covenants when we have easements?
Negative easements only restricts 1. air 2. water 3. light 4. sometimes scenic view.


Covenants are much broader!!
How to determine whether the promise is a COVENANT or EQUITABLE SERVITUDE
The remedy will tell you:




1. If P sues for Injunction = Equitable Servitude


2. If P sues for money damages = Covenant
What elements do you need for a BURDEN to run? [WITHN]


What elements do you need for a BENEFIT to run? [WITV]
Burden [WITHN]:


1. Writing
2. Intent
3. Touch and concern the land
4. Horizontal + Vertical privity
5. Notice



Benefit [WITV]
1. Writing
2. Intent
3. Touch and Concern the land
4. Vertical Privity only
To create an EQUITABLE SERVITUDE that will bind successors: [WITNES]
Equitable Servitude [WITNES]
If an occupier initially has the true owner’s permission to enter the land, may she acquire title to the land by adverse possession?


A Yes, unless the occupier believes she is on her own land


B No, because the statute of limitations will not begin to run


C No, because an adverse possessor must lack the true owner’s permission to be on the land


D Yes, if the occupier communicates hostility
D. Yes, if the occupier communicates hostility.


This can be done by explicit notification, by refusing to permit the true owner to come onto the land, or by other acts inconsistent with the original permission.


While it is true that an adverse possessor must lack the true owner’s permission to be on the land, a subsequent communication of hostility may cause initially permissive possession to become adverse.


The statute of limitations WILL begin to run if an occupier who initially had the true owner’s permission to enter the land communicates hostility, as explained above.
Which of the following parties would be entitled to prevail against a prior transferee under “notice” and “race–notice” statutes?


A A donee of the land


B A judgment creditor


C A mortgagee for value


D One who took the land by specific bequest
C. Mortgagee for value


^the only BFP on the list
Which is Notice and which is Race–Notice?


(1) “Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, whose conveyance is first recorded.”



(2) “Any conveyance of an interest in land, other than a lease for less than one year, shall not be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded,
(1) = Race–Notice




(2) = Notice
Under which theory can the mortgagee take possession of the mortgaged property upon the mortgagor’s default?


A The title theory only


B Either the lien theory or intermediate theory


C The lien theory only


D Either the title theory or the intermediate theory
D Either the title theory or the intermediate theory




Title Theory = legal title is in the mortgagee until the mortgage has been satisfied or foreclosed.


Intermediate theory = legal title transfers from the mortgagor to the mortgagee on default



= Lien theory, followed in a majority of the states, the mortgagee is deemed to hold a security interest in the land and the mortgagor is considered the owner until foreclosure. Thus, the mortgagee may not take possession of the land before foreclosure.
In most states, the reservation of an annual rent, payable monthly, in a lease with no set termination date creates a:
year–to–year periodic tenancy.
Rule in Dumpor’s Case.
If a LL consents to one transfer that violates a covenant against assignment or sublease, he waives his right to avoid future transfer.


The landlord may reserve the right to avoid future transfers, but such reservation must take place at the time of granting consent.


A covenant against assignment or sublease is NOT an unreasonable restraint on alienation.
May a tenant remove a chattel that the tenant affixed to the leased premises?


A No, because chattels affixed to the leased premises become the property of the landlord


B Yes, if removal occurs before termination of the lease and leaves no damage to the premises
B Yes, if removal occurs before termination of the lease and leaves no damage to the premises
A grantor who conveys a fee simple determinable retains:


A A right of entry


B A reversion


C No interest


D A possibility of reverter
D A possibility of reverter
A grantor who conveys a fee simple subject to a condition subsequent retains:


A A right of entry


B A reversion


C No interest


D A possibility of reverter
A. Right of Entry
A landowner owned a tract known as Section 35. He subdivided Section 35, and sold a lot to a neighbor. The warranty deed that conveyed the property included the following language:
COVENANTS***


Purchaser shall have a privilege to hunt and fish on all lands owned by Seller in Section 35.***
These covenants shall run with the land.Years later, the landowner sold the remaining land in Section 35 to a builder.


Shortly thereafter, the neighbor died, leaving the lot to her granddaughter. The builder posted "no trespassing" signs on his land. The granddaughter brought an action for declaratory judgment against the builder to enforce the granddaughter's ability to hunt and fish on the builder's land.


What would be the likely result?


A The granddaughter will win, because the warranty deed granted her an easement.


B The granddaughter will win, because the warranty deed granted her an irrevocable license.


C The granddaughter will win, because the warranty deed granted her a profit.


D The builder will win, because the warranty deed granted a revocable license.
C The granddaughter will win, because the warranty deed granted her a profit.






Profit = nonpossessory interest in land, allowing the grantee to enter on land and remove resources of the land, in this case, fish and game.


Can be conveyed from the original grantee to a third party, as it was here from the neighbor to her granddaughter.


Can be terminated in one of several ways, such as by abandonment or misuse, but the facts here do not indicate that termination has occurred.
A landowner granted to his adjoining neighbor a written easement in a driveway that crosses the southwest corner of the landowner's property. The easement was not recorded.


A statute of the jurisdiction in which the landowner's and neighbor's properties are located provides: "No unrecorded interest in real property shall be good against subsequent purchasers for value without notice unless the conveyance is recorded."In which of the following cases has the neighbor's easement been terminated?


A The neighbor constructs her own driveway and ceases to use the one across the landowner's property.


B The landowner sells his property to a purchaser for value who is unaware of the easement.


C The neighbor begins to hold pottery classes in her home, resulting in increased traffic over the driveway.


D The neighbor tells the landowner that she will no longer be using the driveway, and the landowner thereafter builds a garage over the driveway.
D.The neighbor tells the landowner that she will no longer be using the driveway, and the landowner thereafter builds a garage over the driveway.


NOTE: Although an oral release is ineffective because it does not comply with the Statute of Frauds, it may become effective by estoppel.
For an easement to be extinguished by estoppel, there must be:
(i) some conduct or assertion by the owner of the easement,


(ii) a reasonable reliance by the owner of the servient tenement, coupled with


(iii) a change of position.


(^just like promissory estoppel in contracts)
A rancher entered into a written contract to buy a farm from a farmer for $100,000. The contract stipulated for closing on September 30. In addition, the contract contained the following provision: "The taxes shall be prorated as agreed to by the parties at a later date." Upon the signing of the contract, the rancher gave the farmer a check for $10,000 as a down payment. On September 28, the rancher notified the farmer that he would not be able to close on the farm until October 2, because the closing on his current home, the proceeds from which were to be applied to his purchase of the farm, was unavoidably delayed due to his buyer's illness. Meanwhile, the farmer had difficulty finding a home she liked as well as the farm. She decided that she would rather not sell the farm and wished to avoid the contract with the rancher. On October 2, the rancher showed up at the closing with the $90,000 to tender to the farmer. The farmer did not show up. The rancher sues for specific performance.


In whose favor will the court most likely rule?


A The rancher, because of the operation of the doctrine of equitable conversion.


B The rancher, because time was not of the essence.
B The rancher, because time was not of the essence.


Note: A. is WRONG because the doctrine of equitable conversion will NOT affect the rights of the parties in this situation.


The doctrine of equitable conversion holds that once an enforceable contract of sale is signed, the purchaser's interest is real property, and the seller's interest (the right to proceeds) is personal property.


This is important with respect to which party bears the risk of loss if the property is damaged before the date set for closing or if one of the parties dies prior to closing. It has NO effect in situations like this one where the question in issue is the enforceability of the contract itself.
A landowner owned a large piece of property containing an inn and a bakery. She entered into a contract to sell the property to a purchaser for $1 million. The contract was recorded. The purchaser gave the landowner $200,000 as earnest money. The closing date was set for September 10, two months after the signing of the contract. On August 10, an arsonist set fire to the inn, which burned to the ground. On September 10, the landowner appeared at the closing and tendered the deed to the property. The buyer refused to tender the remaining $800,000 of the purchase price and demanded the return of his earnest money. The landowner sued the buyer for specific performance of the contract. The buyer countersued for the return of his earnest money. Both parties stipulate that the value of the property without the inn is $600,000, that insurance on the property had lapsed, and that the common law, unmodified by statute, applies.What is the most likely result at trial?


A The landowner will not prevail on the issue of specific performance, but will be allowed to keep the earnest money.


B The landowner will not prevail on the issue of specific performance and will be ordered to return the earnest money.


C The landowner will prevail on the issue of specific performance, but the price will be abated to $600,000.


D The landowner will prevail on the issue of specific performance for the full contract price.
D The landowner will prevail on the issue of specific performance for the full contract price.


^Where property subject to a contract for sale is destroyed without the fault of either party before the date set for closing, the rule in the absence of a statute is that the risk of loss is on the buyer. Thus, the buyer must pay the contract price despite a loss due to fire, unless the contract provides otherwise
A developer and an investor had been in the real estate business for many years. Because of their long–standing relationship, the developer and the investor, neither of whom was an attorney, often dispensed with certain legal formalities when dealing with each other, thus saving the costs of lawyers' fees and other attendant expenses. The investor owned a parcel of land that the developer was interested in, and she offered to buy it from him for $50,000. The investor accepted the developer's offer, and the parties agreed on June 15 as the closing date. The developer handed the investor a check for $2,500 with "earnest money" written in the memo, and they shook hands on their deal. A few weeks before closing, the developer called the investor and told him she had changed her mind about purchasing the land because of a a sudden economic downturn in the area. The investor appeared at the developer's office on June 15 with the deed to the land in his hand. The developer refused to tender the balance due, and the investor sued the developer for specific performance.Will the investor prevail?


A No, because the agreement does not comply with the Statute of Frauds and is, therefore, unenforceable.


B No, but the court will allow the investor to keep the $2,500 earnest money as damages.


C Yes, because the $2,500 payment constituted part performance of the contract.


D Yes, because the developer and the investor had established a course of dealing.
A No, because the agreement does not comply with the Statute of Frauds and is, therefore, unenforceable.
In residential leases, a tenant who holds over after termination of a year–to–year periodic tenancy may be held to a new periodic tenancy from __________.


Year to year, with rent payable annually


Year to year, with rent payable monthly

Month to month


Week to week
Month to month


^regardless of the term of the original lease
In commercial leases, a tenant who holds over after termination of a year–to–year periodic tenancy may be held to a new periodic tenancy from __________.


Year to year


Month to month


Week to week
Year–to–year periodic tenancy
Which of the following leases does not create a month–to–month periodic tenancy?


“L leases to T at an annual rent of $6,000, payable at $500 per month”


L orally leases to T “for the next few years” and accepts monthly rent payments


“L leases to T from month to month”


“L leases to T at a rent of $500 per month”
“L leases to T at an annual rent of $6,000, payable at $500 per month” – creates a year–to–year periodic tenancy
If L orally leases to T “for the next few years” and accepts monthly rent payments.


Tenancy at will?
The lease is invalid because most states require that a lease creating a tenancy for more than one year be in writing to satisfy the Statute of Frauds.


However, the tenant’s monthly payment of rent converts what would otherwise be a tenancy at will, terminable at the will of either the landlord or the tenant, into a month–to–month periodic tenancy.
A tenant agreed in writing to lease a retail site in a shopping mall from the owner of the property. The term of the tenancy was two years, and rent was payable in monthly installments at the beginning of each month. At the end of the second year, there had been no discussions between the tenant and the owner regarding renewal or termination. The tenant did not vacate the premises at the end of the term; instead, she sent a check for the next month's rent to the owner. The owner cashed the check and then informed the tenant that he was holding her to a new tenancy and a rent increase of 10%.What is the status of the tenancy that the owner created?
B. A year–to–year tenancy for the original rent amount


RULE: When a tenant continues in possession after the termination of her right to possession, the landlord has two choices of action:
He may:
(1) treat the hold–over tenant as a trespasser and evict her under an unlawful detainer statute, or
(2) bind the tenant to a new periodic tenancy, in which case the terms and conditions of the expired tenancy apply to the new tenancy.
In a commercial lease, a year–to–year tenancy results from holding over if the original lease term was for a year or more.
The new tenancy has the same terms as the original tenancy unless the landlord notified the tenant before termination that it'd be higher
A property owner owned a tract of land that he leased to a baker for 27 years. The baker built a large bakery on the property. The baker then sold the bakery building to a buyer, assigning the lease with the property owner's approval. The buyer has failed to make a rent payment for several months and has also failed to build the cafe that the baker had agreed to build in the original lease.The landlord of the property has a cause of action against:


A The buyer for the rent only, because the rent covenant runs with the land.


B The buyer for the rent and the cafe, but only if the buyer expressly assumed performance of all covenants.


C The buyer and the baker for both the rent and the cafe.


D The buyer for the rent only, and the baker for the cafe only.
C The buyer and the baker for both the rent and the cafe.
Chattels:
A chattel that has been annexed to real property is converted from personalty to realty.

As an accessory to the land, it passes with ownership of the land NOT with a transfer of the personal property of an estate.

The manifest intent of the annexor determines whether the chattel becomes a fixture.
The factors for evaluating the annexor's intent are:
(i) the relationship between the annexor and the premises,


(ii) the degree of annexation, and


(iii) the nature and use of the chattel.
Constructive annexation occurs when an article of personal property (an "accession") becomes...
an integral part of the property, even though it is not physically annexed to the property.
When a mortgagee transfers a promissory note, for the transferee to become a holder in due course: (4)
1. Note must be negotiable in form
payable to bearer or order of named payee
contain promise to pay fixed amount of $
(but MAY provide for an adjustable interest rate)
can't contain other promises
(but MAY have acceleration clause/ attorneys’ fee clause);

NOT a copy

3. The original note must be delivered to the transferee; and


4. The transferee must pay value for the note and take the note in good faith, without notice that the note is overdue or has been dishonored, or that the maker has any defense to the duty to pay it.
Mortgages on the property that are __________ to a mortgage being foreclosed are __________ by the foreclosure if they are made parties to the foreclosure proceeding.


Senior; satisfied


Junior; subordinated


Junior; extinguished



Senior; redeemed
Jr; extinguished


Mortgages on the property that are junior to a mortgage being foreclosed are extinguished by the foreclosure if they are made parties to the foreclosure proceeding.