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 I. | Definitions and General Policy
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A. | Definition: Property is the law concerned with the relationship of persons w/respect to things. "Property" also serves as shorthand or code for a large set of rules. When I say "this watch is mine," I'm invoking this set of rules. Possible reasons we recognize property rights:
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 1. | protecting rights promotes law and order
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2. | encourages labor and investment (in property)
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3. | natural law principles of property
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B. | The rules of property (or the rules as they pertain to the "owner" of property) include:
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1. | right to exclude others from use of the thing
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2. | right and power to transfer interest in the thing
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3. | right to receive income earned and benefits from its use or sale
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4. | immunity from having the thing taken away by gov't w/out paying just compensation (aka: right to compensation for takings)
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5. | Agglomerative Tendency: If property rights are a bundle of sticks, this theory says if you have one stick, you should or must have them all. An all or nothing approach. Agway.
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a. | Commonwealth v. Agway, 1967, p. 30—Does state have property interest in fish such that it can sue in trespass for $ damages when pollution kills them? No. State does have power to regulate fishing, capture and transportation of fish for public good because of its sovereignty over the land, but it does not own the fish (unless it possesses them, as in a fish hatchery). Bottom line: State has no property interest in "free" fish.
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6. | Property rights are Purposive: You can't just ask "Do I have this property right?" You always must ask: Why do you want to know?
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1. | Trespass: Action for an injury to one's possession of land: Common law elements:
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a. | affirmative action by D
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b. | direct or forcible action
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c. | injury to P's person or property
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d. | no longer req'd to show harm or fault
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2. | Trespass on the case (aka "action on the case" or simply "Case"). If elements of trespass weren't satisfied, you may have action on the case if:
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c. | injury was to property was not in P's possession
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3. | Trover: action against person who found goods of another and wrongfully put them to his own use; or action to recover value of lost chattel
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4. | Replevin: Claim and deliver: getting stuff back. P must show prior possession.
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5. | Ejectment: Action to recover possession of land; successful P entitled to recovery of possession and damages (if any).
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a. | Sheriff removes trespasser and puts P back into possession of property
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b. | Modern: requires summary hearing prior to physical ejectment
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c. | In LL-T, may also have summary eviction (speedier, no defenses or extra claims allowed)
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6. | Quiet title action: Possessor seeks declaratory J that P is the actual owner (as pre-emptory)
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7. | Nuisance: P seeks to stop D from activity interfering w/P's use and enjoyment of the property (generally seeks injunctive relief)
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II. | Possession and Ownership
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A. | Possession v. Ownership:
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1. | Possession consists of dominion and control over the property w/the intent to exclude others.
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a. | Tapscott v. Cobbs: A peaceful possessor of land is usually allowed the same legal protection as an owner w/regard to a trespasser, unless that trespasser is actually the rightful owner. Prior possessor beats subsequent possessor, unless trespasser is owner.
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2. | Ownership requires title, possession does not.
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B. | Two ways to establish ownership over a resource no one has previously owned:
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1. | 1) Call it res nullis (an independent thing)
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a. | Use occupation theory of property—I got here first, it's mine.
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(1). | Blackstone on Property rights (p. 25)—argues that assignment of property rights based on occupancy leads to social peace, order and prosperity, and that everything for which property rights can be assigned, should be so assigned. This will also reward labor, which we want to do.
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(a). | Important to recognize: Blackstone's not clear on whether he's trying to describe history, how rights worked at the time of his writing, or is he trying to say how property rights ought to be?
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(b). | Descriptive fallacy: The misconception that just because things are a certain way, that's how they ought to be.
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(c). | Blackstone tended to believe that things did operate as they ought to.
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(2). | Capture doctrine: Prior to capture, a wild animal is ferae naturae, therefore res nullis. You possess it by capturing it (which requires labor). Mere pursuit is insufficient to establish ownership. Pierson v. Post.
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b. | Use labor theory of property—I put labor into this land/thing, therefore I deserve rights in it.
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(1). | Keeble v. Hickeringill, England 1707, p. 19—P a duck hunter who used decoys to lure ducks to his land; D fired a gun near P's land and scared the ducks away for four months. Ct. found for P—D was liable for interfering w/P's right to make productive use of his land. Ct. found D a malicious intermeddler, rather than a fair competitor. Demonstrates the labor theory of property. Keeble is also about recognizing a kind of property right (right to exclude, use productively) that the court in Pierson refused to recognize.
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(2). | Bundle of Sticks: Property is often described as a bundle of sticks—if you own something, you have right to exclude, right to sell, etc. In this decision, Keeble has some of the sticks, but not all of them. This raises a basic tension in property law: Should we say Keeble has a partial or limited property right? Should we allow partial property rights? Or should we say property rights are all or nothing? The agglomerative tendency of our property law suggests this all or nothing approach.
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2. | 2) Use an Accession doctrine—attach property rights of this resource to the ownership rights of some other thing. Ie: if you own the land, you own the trees.
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a. | Ratione soli—an accession doctrine that says he who possesses the soil possess that which sits upon it, sometimes including the animals. We mostly don't do this in the U.S., but some states do it w/some animals that are characteristically tied to the land.
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C. | Jus Tertii: right of 3rd party possessor; usually operates when trespasser sues prior possessor (non-owner). Prior possessor raises jus tertii defense, basically saying "I may not have the right to this property, but you don't either; someone else does. You can't get me off the land, because you don't have the rights."
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1. | Prior to expiration of SOL, prior peaceful possessor can prevail over anyone except the actual owner.
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2. | If reqs of adverse possession met, then possessor can beat out actual owner.
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3. | Chain of rights: Owner, prior peaceful possessor, trespasser.
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4. | Prior peaceful possessor must have 1) physical control over property, and 2) intent to assume dominion over it. (Means more than mere discovery of property)
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5. | The point of jus tertii docrine is to protect three things:
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c. | But we don't want to make trespassers pay twice (to prior possessor and true owners), so cts are split on awarding damages to prior possessors against trespassers.
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6. | Tapscott v. Cobbs, 1854, p. 54—Can Cobbs' questionable title be used to eject Tapscott from the land? Tapscott raises a Jus Tertii defense—the right of a third party. Basically saying "I may not have the right to this property, but you don't either; someone else does. You can't get me off the land, because you don't have the rights." Ct. first says the general rule is that P must prove ownership, which means, de facto, that the D's jus tertii defense is valid. If D shows that a 3rd party is owner, then P can't show ownership. However, Ct. eventually says this case is an exception to general rule above: If D is prior peaceful possessor, P must prove ownership. But if P is prior peaceful possessor, P need not prove ownership to succeed in enjectment. Basically, only the true owner beats the prior peaceful possessor.
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III. | Adverse Possession: Possession for a statutorily prescribed period of time can, if certain elements are met, ripen into title. Where jus tertii can give possessor rights against trespassers, adverse possession can give possessor rights against true owner.
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A. | Elements of adverse possession: A ECHO (must have all elements for the full statutory period)
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1. | Actual: The entry cannot be hypothetical or fictitious or symbolic. Possessor must actually posses land, which you show by using the land. No absolute, but a relative standard, depending on where the land is and what landowners in that locale would do.
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2. | Exclusive: requires possessor be pretty much (but not absolutely) the only one who uses the property. Ewing v. Burnet (supp.) You have to have same exclusivity that an owner would normally have on that type of land.
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3. | Continuous: Possession must be continuous, uninterrupted for the given statutory period.
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a. | Mendonca v. Cities Service Oil Co., 1968, p. 83—adverse possession: "continuous," "hostile, and under claim of right"
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4. | Hostile: Possessor does not have the true owner's permission to be there.
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a. | Patterson v. Reigle, 1846, supp 17-18—hostility element: When you occupy land w/out express permission of owner, there's a presumption of hostility.
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5. | Open and Notorious: The sort of possession the owner knew or should have known about.
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a. | O'Keefe v. Snyder, 1980, supp 20—open and notorious element of adverse possession
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B. | Possessor's subjective state of mind is irrelevant. Doesn't matter what possessor was actually thinking at the time—whether possessor knew he was trespassing or not. Relevant inquiry is gauged by an objective standard and depends on circumstances.
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1. | One adverse possessor may tack on to his time on the land his predecessor's time, so long as there is privity of estate btwn the parties and no gaps. Privity can be satisfied by any non-hostile nexus, such as: blood, contract, deed, or will. Privity requires:
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a. | voluntary intent to transfer the land
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b. | subsequent possessors not hostile to each other
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c. | subsequent possession must not occur randomly, by happenstance
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2. | Tacking is not allowed when there has been an ouster.
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3. | Belotti v. Bickhardt, N.Y. Ct App., 1920, p. 63
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a. | Holding: This ct. says that you can add the periods of possession together, because regardless of what the deed says, Reidel must have intended to give the entire building along with the land. The fact that this was an inside-the-family transaction (not conducted at arm's length) makes this intent more likely. You need continuous possession, and if more than one possessor is involved, you need continuous intention to pass along rights. (That's why a trespasser can't come along and add his time of possession to that of previous possessors who did not intend to pass on the land to the trespasser.)
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D. | Disabilities and the SOL:
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1. | SOL will not run against a true owner afflicted w/disability at the inception of the adverse possession (when the action accrues/began)
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2. | Disabilities are by statute, but commonly include: infancy, insanity, imprisonment.
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3. | Disability must have been present at time action accrued (when adverse possession began). Death of owner usually ends tolling period and the owner's heir gets benefit of the toll.
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4. | If the disability ends (i.e. minor comes of age, owner gets out of jail, etc.), owner gets a set period of time or a new full SOL (depending on statute) to bring an action against possessor. If disability provision provides for less time than SOL, SOL trumps.
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E. | Adverse Possession for Moveable Property:
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1. | Different rules trying to balance rights of possessors and owners w/regard to adverse possession of movable property:
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a. | Discovery Rule: A cause of action will not accrue until the injured party discovers, or by exercise of reasonable diligence and intelligence should have discovered, facts which form the basis of the cause of action.
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(1). | IOW: Discovery rule says the SOL starts ticking when the owner knew or should have known the property was gone and who had it.
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b. | New York rule is a Demand Rule—the SOL starts running when the owner says to possessor "give it back" and possessor says "no." (The clock starts actually on the refusal, not on the demand.) This prevents you from gaining possession simply by stealing and hiding property until the SOL runs out.
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(1). | Demand Rule is very friendly to owners: The demand rule assures owner gets benefit of the SOL.
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(2). | Demand Rule plays no burden on owner to make effort to find missing property; it simply says that if you ever find it, you can make your demand and get your 6 years. Some think this protects owner too much because it doesn't punish the lax owner. The owner is also protected, because even if he does know his property is gone and knows where it is, the clock doesn't start until he makes the demand.
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c. | Different rules for movable property because:
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(1). | If someone is using your land, you probably are going to know who it is. Not true w/movable property.
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(2). | Whereas the law wants to reward diligent possessors of land because that might be good for society (might), there's less reason to reward diligent possessors of movable property—this could easily descend into rewarding thieves.
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F. | Possible Policy Purposes for Adverse Possession Doctrine:
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1. | To reward diligent possessors
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3. | To clear up titles. Society has an interest in resolving conflicts over land ownership.
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G. | Prescriptive of Easements: (adverse possession applied to easements)
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1. | An easement is a single-purpose right of use. A right to use a piece of property in a particular way—pipeline easements, shared driveways have right-of-way easements, etc. If you have an easement, you have only that one right of use, and no other rights.
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2. | The chronological requirement for the statute of limitations is the same for prescriptive easements as for adverse possession
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3. | Adjustments to elements of adverse possession—we ask: Did the owner use the property in the way the owner of an easement would have?
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IV. | Ownership of Lands and Natural Resources
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A. | Common Law: Property rights in land extend below to the center of the earth and above to the "periphery of the universe." Extreme form of the accession doctrine.
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1. | Geragosian v. Union Realty Co., S 29-32— Trespass action; P sought an injunction, and got it.If you own the surface of land, that also gives you right in air above and subsurface below. Landowner can generally exclude any encroaching activity by another on or near the surface (fire escapes, cables, sewer pipes, buildings, etc.).
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a. | Bright line rule: Appropriate relief for actions involving real property (land) is injunction because ct. assumes real property (land) is a unique good and damages would not be an adequate substitute. It would also be hard in a case like this to measure damages because there's no market value for the encroachment of a structure on land.
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B. | Modern view: Doctrine modified to take into account public interest in the use of air space and to recognize that property rights are purposive.
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1. | Edwards v. Sims (take 1), Ct. of App., Kentucky, 1929, p. 228— Who owns the cave when entrance is on one property, but much of the cave is beneath another? This appeals ct. decides the merits of the case, comparing it to a cases where mines have been ordered to allow surveys to determine whether the mine is trespassing on neighbors' property. Ct. said an owner of a piece of land owns it to sky and depths, so if the cave is under Lee's land, Edwards is trespassing.
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a. | Dissent: Says the proper rule is that he who owns the surface is the owner of everything that may be taken from the earth and used for his profit or happiness. (Sort of a labor theory of ownership.)
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(1). | Is the cave res nullius (a thing unto itself), or should we attach it to something, under an accession doctrine?
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(a). | The majority attaches the cave to the surface, and says that if you own surface, you own cave. This is a segmented accession doctrine—it treats the cave and surface as segments that are joined.
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(b). | The dissent is treating the cave more as res nullius which can be owned:
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II. | When you've tried real hard to get it or make it profitable/useful.
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(c). | Also possible to see dissent as using an accession doctrine, tying the ownership of the cave to the ownership of the entrance to the cave.
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b. | Other possible ownership schemes:
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(1). | Accession doctrine variables: Treat cave as attached to surface or entrance.
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(2). | Treat it as res nullius and give ownership to first occupant or whoever puts in labor to make it profitable.
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(3). | Regalian prerogative: say all caves are owned by state.
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(4). | Grant joint ownership, making Lee and Edwards partners in ownership. We do this with oil; if you own surface rights, you're a part owner in whatever oils is beneath your land.
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2. | Edwards v. Lee's Administrator, 1936, p. 234— Edwards is appealing lower court's award of damages to Lee, which was 1/3 of profits for the use of the cave, corresponding roughly to the portion of the cave that's beneath Lee's land. Lee claims lower court applied the wrong measure of damages, and that even if the measure was correct, the amount was erroneously computed.
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a. | In figuring damages, should the standard be:
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(1). | What the D gained by the trespass? (the suit in assumpsit)
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(2). | What P lost because of the trespass? (the usual tort measure)
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b. | Holding: On the unusual facts of this case, the tort measure for damages would result in only nominal damages. This ct. looks to D's gain and used unjust enrichment as a measure of damages. This is controversial and contrary to restatement, which says that if the P hasn't actually lost anything, you don't have to pay unjust enrichment. The restatement says that if you trespass on someone's land and you don't do any damage, you don't have to pay restitution.
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c. | Trespass is a tort, and the typical tort case looks at P's loss and seeks to make P whole. Three types of trespass cases:
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(1). | If P's loss is greater than D's gain, it's the D's tough luck. P is entitled to be made whole via a suit in tort.
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(2). | If P's loss is identical or similar to D's gain, no problem; D pays P back, essentially, via tort claim.
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(3). | If P's loss is much less than D's gain, what do we do? A couple of frameworks:
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(a). | Legal doctrine: Waiver of tort and suit in assumpsit.
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I. | Tort claim is the P's claim to be made whole.
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II. | Suit in assumpsit refers to recovering D's gain.
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III. | Allows P to give up the tort claim, and recover the amt. D gained. Only allowed in certain situations:
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A. | When P's loss is greater than D's gain (P chooses to accept lesser amt.)
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B. | When P's loss is roughly equal to D's gain.
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C. | When P's loss is hard to calculate, and D's gain is easier to calculate, the law often allows P to waive tort and sue in assumpsit.
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(b). | Economic theory: Distinction between transfer earnings and economic rent.
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I. | Hypo: I own a car, and it's market value if I rented it out would be $75/day. If I rent it out for $100/day, then I'm getting $75 in transfer earnings, and $25 in economic rent.
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II. | The amount above what market demands is "economic rent." (Economic rent = "gravy")
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III. | The bargaining process Edwards and Lee engage in to determine a fair payment for renting the cave, would be the rent. But because this is a bilateral monopoly (there's no transfer earnings, Lee can't do anything else with this cave; there's no market for the rental of this cave), the rent must be determined by bargaining.
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V. | Water Rights: Two systems for allocating water from water courses (streams, rivers, lakes)
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A. | Riparian Doctrine: (traditional from England; used in East U.S.) Water belongs to those who own the land bordering the water course. These are Riparians. They share the right of reasonable use of the water.
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1. | Rights gained by owning land adjoining water. Rights not chronological; if you own adjacent land, you own water rights. Rights pass w/the land.
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2. | Normally land and water rights are not severable
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3. | Right no quantified; generally no limits on use. Also rights not affected by disuse.
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4. | Natural flow doctrine: You can do what you want w/your water so long as you don't obstruct or materially reduce the natural flow. (Dumont)
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5. | Reasonable use doctrine: Most if not all jurisdictions apply this. If you have a water right in a riparian system, you can use as much water as is "reasonable." (Dumont) Exceptions to reasonable use:
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a. | Strangers (non-owners) have no rights, regardless of reasonableness.
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b. | No owner can divert a stream from its natural course such that it's turned away from the proprietor(s) below.
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B. | Prior Appropriation Doctrine: Water is res nullis, belongs to no one initially, therefore controlled by the state. Right to divert and use water can be acquired by an individual, regardless of whether she is a riparian owner. Used in most Western (drier) U.S. states.
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1. | Rights are determined by priority of beneficial use. Norm is: First in time (to divert and use), first in right. In times of shortage, those with earliest rights get preference.
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2. | Rights can be lost through disuse.
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3. | Appropriative users who don't have adjoining land must have easement over property adjoining the water to get to the water.
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4. | Robinson v. Ariyoshi, Hawaii, 1985 (vacated by Supreme Court)—In jur. that switched from appropriative to riparian water rights, ct. held that: Rights of Ps to their water are affirmed, and if the state decides to take the P's water, the state will have to do so via eminent domain and pay just compensation.
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A. | What we're trying to accomplish by a system of conveyancing:
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1. | Ideally the system would:
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a. | Be Simple, easy for anyone to do themselves; inexpensive.
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b. | Prevent fraud. Prevent people from claiming they had rights they did not have. People who would care who really owns land: potential purchaser, real owner, taxing authority, etc.
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c. | Transparency of ownership—should be easy for anyone to identify who owns what.
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d. | Clarity in what's owned and when ownership began/ended/changed.
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e. | No unintentional transfers; ensure successful intended transfers.
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f. | Uniformity (people haven't always seen this as a value)
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2. | How could you achieve this?
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a. | Enfeoffment—13th c. ritual conduct that effected a transfer.
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b. | Government registry—you have to go to a gov't office and put the transfer on the books.
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(1). | Pros: transparency, clarity, less fraud
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(2). | Cons: eliminates privacy, could become complicated (why would transfers need to be private?), maintenance might be difficult and expensive.
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c. | Certificate of Title system (like we use for cars)—when you transfer the title, you transfer the property.
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(1). | Problem: If you want to sell only part of the land, what do you do?
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d. | Written agreements between the parties
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(1). | cons: would invite fraud, isn't permanent, no record.
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3. | Our current system combines a government registry and a title system.
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4. | Future interests: A right to possess property in the future. You can give future interests by deed, in which case you can't take that future interest back. (You can take back future interests given by will.)
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B. | Every conveyance of real estate will always consist of a two-step process:
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1. | Step 1: The land contract—relatively short-lived, expires w/closing.
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a. | SOF: land contract typically must be in writing signed by defendant, the party against whom enforcement is sought. It must also describe the land and mention some consideration.
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b. | Exception to SOF: The doctrine of part performance — satisfied by any two of the following three circumstances:
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(1). | B takes possession of the land.
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(2). | B remits all or part of the purchase price.
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(3). | B makes substantial improvements to the premises.
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c. | Two implied promises in every land contract:
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(1). | Seller promises to provide marketable title, meaning title free from reasonable doubt, lawsuits and threat of litigation.
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(a). | Three circumstances will render title unmarketable:
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I. | Adverse possession. Acc. to majority rule, seller must be able to supply good record title. If even a portion of the title resides in adverse possession, the title is unmarketable.
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II. | Encumbrances: Marketable title means unencumbered fee simple; therefore, servitudes and mortgages render title unmarketable, unless you see that buyer has waived them.
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III. | Zoning violations: Title is unmarketable if property violates a zoning ordinance.
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(2). | Seller promises not to make any false statements of material fact.
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(a). | Majority of states now hold seller liable for failing to disclose latent material defects. This means that seller is liable for material lies and omissions.
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2. | Step 2: The closing, where deed is now the controlling document.
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a. | When all goes well, deed passes legal title from seller to buyer immediately upon delivery—An irrevocable present transfer of an interest. To work its magic, the deed must be LEaD: Lawfully Executed and Delivered.
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(1). | Lawfully Executed: Deed must be in writing, signed by grantor, and comporting w/all statutory pre-requisites.
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(2). | and Delivered: Delivery could be satisfied when grantor physically or manually transfers deed to grantee. However, delivery does not nec. require actual physical transfer of the instrument itself.
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(a). | Standard for delivery is a legal, not literal, standard: Did grantor have present intent to be immediately bound? Did grantor have present intent to part w/legal control? Regardless of whether deed itself has been literally handed over to grantee.
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(1). | Quitclaim: contains no covenants. Grantor isn't even promising he has title to convey. This is the worst deed a buyer could hope for. (Shaggy: "It wasn't me.")
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(2). | General Warranty Deed: Makes a series of promises on behalf of grantor and grantor's predecessors. Warrants against all defects in title, including those attributable to grantor's predecessors.
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(a). | The best deed a buyer could hope for. (Mother Theresa of deeds.)
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(b). | Six promises of the General Warranty Deed:
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I. | Present Covenants: Breached, if ever, at the time the deed is delivered. This means the SOL for breach of a present covenant begins to run the instant of delivery.
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A. | Covenant of Seisin: Grantor promises he owns estate he now claims to convey.
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B. | Covenant of Right to Convey: Grantor promises he has the power to make this conveyance, meaning there are no temporary restraints on grantor's power to sell.
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C. | Covenant Against Encumbrances: Grantor promises there are no servitudes or mortgages on the land.
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II. | Future Covenants: Not breached, if ever, until grantee is disturbed in possession. SOL for breach of a future covenant will not begin to run until that future date.
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A. | Covenant of Quiet Enjoyment: Grantor promises that grantee will not be disturbed in possession by a 3rd party's lawful claim of title.
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B. | Covenant of Warranty: Grantor promises to defend grantee should there be any lawful claims of title asserted by others.
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C. | Covenant for Further Assurances: Grantor promises to perform whatever future acts are reasonably necessary to perfect grantee's title if it later turns out to be imperfect.
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(3). | Statutory Special Warranty Deed: Provided for by statute in many states. Some states call it the "bargain and sale deed." Grantor makes no promises on behalf of his predecessors in interest. Instead, grantor makes two promises only on behalf of himself:
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(a). | Grantor promises that he has not conveyed this estate to anyone other than grantee.
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(b). | Grantor promises estate is free from encumbrances made by grantor.
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a. | Granting clause or premises clause: Names grantor and grantee (the parties), verbs of conveyance (give grant bargain sell and convey—words indicating a present intention to transfer), geographical description of the property (ou have to be able to tell what's being transferred), and Description of estate conveyed. "to Abbot and her heirs and assigns forever..."
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b. | Habendum clause: to have (grants possession)
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c. | Tenendum clause: to hold (from the time when you were holding land for a feudal overlord) (from tenure; a little like your relationship to your landlord)
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d. | Redendum: providing service of knights (no modern analog)
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e. | Testimonial clause: seal and swear
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f. | Attestation Clause: Statement of witnesses, signature, acknowledgment (notary).
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g. | Deeds need not mention consideration. A deed can be a gift. However, it's common to recite consideration, just in case.
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h. | If you repeat things in a deed or something's contradictory, the first mention counts.
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i. | Metzger v. Miller, N. Dist of CA, 1923 (p. 356)—absolute minimum essentials for a valid deed are a written document containing:
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(1). | 1. name of grantor and grantee (can be on envelope or in greeting of letter)
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(2). | 2. geographical description of the property
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(a). | Here, she doesn't name the property with precision, but it's not really in dispute.
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(b). | Cts. are somewhat divided on the extent to which you can look outside the document to verify or pinpoint the description of the property.
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(3). | 3. Verbs of conveyance (something that shows a present intent to convey)
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(4). | 4. signature of the grantor (grantee does not have to sign)
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(5). | Apart from statute of frauds, grantor must presently intend to convey the land.
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(a). | Case is brought in Federal ct. because there's a statutory requirement that if a gov't official is the D, the case should be in federal ct.
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I. | Otherwise, this case couldn't be in federal ct. Because P is asserting a state law claim, while D is the one raising the federal law issue. Therefore, it should be tried in state court, except that the D is a federal official.
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(b). | In 1914 Graf died, left land to her German sister, Karoline Schwab. Schwab was in Germany.
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(c). | Metzger (P) is Schwab's son; Miller (D) is a government official who has seized the land because Schwab was an enemy alien.
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(d). | Metzger claims Schwab gave him the land; therefore Miller has no right to take it. However, Metzger doesn't have a formal deed.
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I. | Why doesn't Schwab just give Metzger a "quitclaim" deed right now to clear up the matter? (see p. 350 for comments on quitclaim deeds). Because, if Schwab still owns it, she can't effectively give it to Metzger so long as she's considered an enemy (Under the "Trading with the Enemy Act" of 1917.)
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(e). | Metzger's "proof" of ownership is a series of letters from his mother saying she gave him the land.
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(7). | Issue: Do the letters from Schwab constitute a conveyance of the property to Metzger? Do they "disclose a present intention and purpose on the part of the mother to pass the title to constitute in law a grant of transfer of the property in question?"
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(8). | Holding: Yes. The language of the letters shows "a present purpose to convey and to sustain the contention that it operated as a conveyance by the mother of the real property involved." (p. 358)
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(a). | "I am now giving" expresses a pretty definite present purpose.
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(b). | Last letter talks about the conveyance as past, already complete.
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(c). | You don't need one document that wraps it all together; this series of documents can add up to a conveyance.
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(a). | On p. 358, the court starts talking in language of contract, and looking at the problem through contract law. We don't want to show a contract, we want to show a conveyance.
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4. | Oral Transfer: SOF voids oral transfer unless there's parol evidence showing:
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b. | possession of property by grantee
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d. | valuable improvements made to the property
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e. | Hayes v. Hayes, Sup. Ct. of Minn. 1914 (p. 362)—a case where there is no written conveyance. Where a father allowed son to use land as his own for 17 years, ct. found that father (P) could not assert ownership and eject son's wife from land because son and daughter-in-law had relied on the idea that the land was theirs so it would have been unjust to take it away.
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(1). | Three requirements for taking a parol grant or gift of land out of the statute of frauds:
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(a). | 1. An oral grant indicating present intention to convey
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(c). | 3. Evidence of detrimental reliance (p. 365). Grantee must do something that he/she wouldn't normally have done unless there had been a conveyance. Normally this means making improvements you wouldn't have made if you knew someone else could take the property away from you.
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(2). | Last line of case: Shouldn't the law be in line with justice? Shows a tension between wanting "rules" for conveyance of property because the issue can often become clouded by strong feelings and sentiments.
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5. | Delivery of deed: If you have a written deed, it must be delivered. (p. 370) see above.
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a. | This is required because if you draft a deed but keep it in your desk, you probably don't intend it to take effect. If you deliver it, that shows your present intention to convey.
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b. | Escrow agents allow conditional delivery. (p. 371) Escrow agent can be instructed to only turn over the deed to grantee after grantee has satisfied some condition. See Hood and Nickleplate cases.
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(1). | May involve doctrine of "relation back." Under certain conditions with escrow delivery of deeds, the date of delivery will be said to "relate back" to date of delivery to escrow agent, rather than the actual date of delivery to grantee.
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C. | Recording Systems for land conveyancing (Note: If you don't have a second purchaser from the same grantor, you don't have a recording statute issue. Recording acts only apply to second (or third or fourth, etc.) purchasers from the same grantor.)
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1. | Recording questions always involve the case of the dirty double-dealer: O conveys to A, then later conveys the same parcel to B. In battle of A v. B, who wins?
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2. | Two bright line rules:
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a. | If B is a bona fide purchaser (BFP) and we're in a notice jurisdiction, B wins, regardless of whether she records before A.
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b. | If B is a bona fide purchaser and we're in a race-notice jurisdiction, B wins if she records properly before A does.
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3. | Different kinds of recording statutes (this is only important at the very end of your analysis; see p. 611-12, and handout):
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a. | Race statutes—"first duly recorded" means what matters is whether B records before A. It's a "race to record" statute. First to record wins (so long as B has qualified under the four steps below). The first-to-record wins so long as previous chain of title is unbroken.
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b. | Notice statutes—if statute mentions subsequent "good faith" grantees: What matters is whether B was a bona fide purchaser. When B purchased, did he/she know there was a prior sale? If B either does or should know (actual or constructive notice), then B can't beat A.
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(1). | Four kinds of notice that matter based on two kinds of knowing, actual (what you actually know) and constructive (what you should have known) (see handout)
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(a). | actual record notice (things you'd know if you checked the records; can be actual or constructive)
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(b). | constructive record notice
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(c). | actual non-record notice
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(d). | constructive non-record (things a reasonable person would know by reading the newspaper or just having your eyes open and paying attention; can be constructive or actual)
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c. | Race-Notice statutes—Asks both questions: Did B record before A? And was B a bona fide purchaser?
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4. | Analyzing recording act problems: Example: O conveys to A first. Then O conveys to B.
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a. | Big picture: A recording act makes a deed conveyance tentative; you don't just need a valid deed, but also registration in the recording office. First ask: Has A recorded promptly? If not, A is at risk to B (2nd in time). Then we ask: Did B do all things necessary to beat out A?
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b. | You must run through the following four steps in order:
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(1). | 1. Under recording act, was the interest A got one that was supposed to be recorded?
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(a). | Check recording act to see if it was narrow or broad. (p. 612 has examples of narrow or broad statutes). I.e: under statute B, if A got an easement, it doesn't have to be recorded and common law prevails. If it was under Statute C, then the easement did need to be recorded and you go to step 2.
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(b). | Steps 1 & 2 focus on A (the first-in-time) to see: Did A do what he/she was supposed to do?
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(2). | 2. Did first-in-time promptly record? "Promptly" means: before the grantor had a chance to sell to another party. If so, then the analysis is done; 1st-in-time wins. If not, then on to step 3.
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(3). | 3. Is B (2nd-in-time) a BFP? Recording acts only protect BFPs, not recipients of gifts. If B received property as gift, B can never win, 1st-in-time wins. (Doesn't matter whether A was a purchaser or got interest as a gift.) If B is a BFP, go on to next step.
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(4). | 4. What kind of recording act do we have? This will tell you the conditions under which B could win.
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5. | Recording statutes exist to protect bona fide purchasers (BFP) and mortgagees. They do not protect donees, heirs, or devisees. A BFP is:
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a. | One who purchases for value (value means substantial pecuniary consideration), and
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b. | W/out notice that anyone else got there first.
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(1). | Three forms of notice potentially chargeable to B: (AIR)
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(a). | Actual Record Notice: B checked records and learned of A's existence
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(b). | Constructive Record Notice: B would have learned of A if B had checked the records; therefore B should have known of A.
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(c). | Actual non-record notice: Prior to B's closing, B was literally advised of A's existence.
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(d). | Inquiry notice: B is on inquiry notice of whatever an inspection of the land would reveal, whether B bothers to inspect or not.
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6. | Proper recordation; Deed must be linked to the chain of title, the sequence of recorded instruments capable of giving record notice to subsequent takers.
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a. | Usually established through title search through grantor/grantee index.
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b. | Problem of the wild deed:
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(1). | Classic case: O sells to A who does not record. A sells to B, who records.
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(a). | The A to B deed, although recorded, is not connected to chain of title b/c that chain contains a missing grantor—the O to A link is missing from public records. The A to B deed is therefore a "wild deed."
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(2). | Rule of the wild deed: If a deed entered on the records has a grantor unconnected to the chain of title, the deed is a wild deed, meaning it is incapable of giving record notice of its existence.
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(3). | Now, suppose O sells a second time, this time to C. C records. In contest of B v. C, who wins? C wins in both a notice and race/notice state.
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(a). | C wins in notice state b/c when she took she was a BFP.
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(b). | C wins in race/notice state b/c she's a BFP who wins the race to record. (Be recorded first, but B's recordation was "wild" and therefore it's like it didn't happen.)
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7. | Estoppel by Deed: a bizarre chain of title problem
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a. | Classic case: In 1950, O owns Blackacre. Later in 1950, X, who does not own Blackacre, sells it to A. In 1950, A records. In 1960, O finally does sell Blackacre to X. X records. In 1970, X sells again to B. B records. Two contests emerge:
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(1). | Between X and A, who owned Blackacre from 1960 to 1969? A did b/c of estoppel by deed.
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(a). | Estoppel by Deed: one who conveys land in which he has no interest (i.e. X in 1950), is estopped from denying the validity of that transfer if he subsequently acquires the land that he had previously transferred.
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(2). | Who owns Blackacre in 1970 when B enters scene? B, as long as he's a BFP.
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(a). | B wins in a notice system because he is a BFP.
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(b). | B wins in race/notice system b/c he is a BFP who wins the race to record. (A's 1950 recordation is a nullity; it was a wild deed at that time. A recorded too early. B's title searcher would never find X's pre-ownership transfer to A.
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8. | Shelter Principle: Where O grants to A, then also to B, and B grants to C. Who wins? A or C? Two step analysis:
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a. | Does B beat A under Recording Act? If yes, then anyone under B beats A. If no, then:
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b. | Can C beat A in his own right?
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(1). | Race: If B records before A, C is sheltered under B even if C doesn't record
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(2). | Notice and Race-Notice: If B isn't a BFP but records before A, B has bad title. If B sells to BFP C, that doesn't shelter C who must win title in his own right.
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c. | Micklethwait v. Fulton, 1935 (p. 376)—Case of the made up escrow. Where there's no fork in the chain of title, recording act doesn't apply. In this case, although P claimed there was a fork, there really wasn't; chain of title was unbroken.
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(a). | In 1928, Abigail Micklethwait (P) says she gave deed in escrow to her daughter, Louise Marshall, to be executed on Abigail's death. Abigail's son, O.R., was supposed to hold the deed until Abigail's death.
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I. | O.R. says he was never informed that he was supposed to be the escrow agent.
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(b). | Somehow the deed came into the hands of Louise's husband, Leon Marshall, who recorded it in Louise's name in 1930.
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(c). | Leon borrowed money on the property, then disappeared with the money. Bank (Fulton) got a judgment against Leon, and got a lien against the land.
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I. | Bank is going out of business. This is the great depression.
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(d). | Abigail brought suit against bank (Fulton) seeking to have the deed of conveyance set aside because:
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I. | 1) It was not delivered according to Abigail's instructions (after Abigail's death)
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II. | 2) It was not properly accepted by grantee (Louise) because she didn't know it had been reported.
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(2). | Issue: Whether an escrow deed, which was wrongfully delivered and recorded before performance of the conditions of the escrow, is a valid deed of conveyance as to a third party who innocently renewed or extended credit to the grantee on the strength of and in reliance upon his record ownership of the property therein described.
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(3). | Holding: No, this escrow deed cannot be set aside. Holding for D.
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(a). | P was negligent in setting up the escrow and making sure the deed was not executed until her death. She didn't even tell the escrow agent what he was supposed to do.
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(b). | We should protect the bank because it's an innocent 3rd party who relied on a recorded deed to lend money.
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(c). | Ct. says that conditions of escrow are by their nature private, so therefore risky unless recorded. Abigail should have recorded it.
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(d). | Bottom line: P was negligent, bank was innocent. Without those two things, the result would be opposite.
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(a). | The real story here was probably that everyone was bankrupt in the great depression; Abigail really did convey the property to Louise, but later made up the escrow story to try to keep the bank from taking the land.
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(b). | If Leon had forged the deed and borrowed money, the bank would have lost. The bank would be negligent in not tracing the chain of title before it lends money. Someone who takes a wild or forged deed will not be protected.
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(5). | Not all courts agree w/Micklethwait.
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VII. | Estates in Land, aka “feudal interests” (future interests are in another video)
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A. | Three essential questions about each interest:
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1. | What language creates the estate?
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2. | Once identified, what are the estates' distinguishing attributes?
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a. | Is the estate devisable (can it pass by will)?
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b. | Is the estate descendable? Will it pass by statutes of intestacy if its holder dies w/out a will?
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c. | Is the estate alienable? Is it transferable inter vivos (during its holder's lifetime)?
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3. | Is there a future interest to accompany the estate?
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1. | Fee Simple Absolute (FSA)
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a. | Language that creates it: "to A" or "to A and his heirs"
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b. | Distinguishing attributes:
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(1). | Absolute ownership of potentially infinite duration. Best estate a taker could hope for.
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(2). | Freely devisable, descendable, and alienable.
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c. | NO future interest accompanies the FSA.
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(1). | If "O conveys to A and his heirs," A is alive and well, what do A's heirs have? Nothing.
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(2). | Sinead O'Connor rule of property: A living person has no heirs. Living people may have heirs apparent, or prospective heirs, but they don't matter to the FSA.
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a. | Language: "To A and the heirs of his body."
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b. | Distinguishing attributes:
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(1). | Virtually abolished in U.S. today.
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(a). | If you try to create a FT today, you'll end up creating instead an FSA.
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(2). | Historically, the FT would pass to the grantee's lineal blood descendants, no matter what. Purpose was to keep land in the family to maintain and protect family dynasties.
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(3). | Accompanying future interest? Yes. A future interest in O, the grantor, it was called a "reversion." Future interest in a 3rd party would be a "remainder." (To A and the heirs of his body and then to B: B has the remainder.)
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3. | Defeasible Fees (three types—frequent testing ground and vital in practice)
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a. | Two important rules of construction for all defeasible fees:
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(1). | Words of mere desire or hope or intention are insufficient to create a defeasible fee.
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(a). | Courts disfavor restrictions on the free, unencumbered use of land. Therefore, courts avoid finding a defeasible fee unless clear durational language is used.
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(b). | i.e.: "To A for the purpose of constructing a daycare center." A has an FSA.
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(c). | i.e.: "To A with the expectation that the premises will be used for a drugstore." A has an FSA.
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(2). | Absolute restraints on alienation are void.
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(a). | An absolute restraint on alienation is an absolute ban on the power to sell or transfer. Can't do that. If you see that, you know it will be considered a nullity.
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(b). | i.e.: "To A so long as she never attempts to sell." You can't do that. Discard the condition; A has an FSA.
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b. | Fee Simple Determinable (FSD)
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(1). | Language to create: "To A for so long as...." or "To A during.... " or "To A until..."
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(a). | Grantor must use clear, durational language. If stated condition is violated, forfeiture is automatic.
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(2). | Distinguishing attributes: It's devisable, descendable, and alienable.
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(a). | i.e.: Paul conveys to Ringo so long as the premises is used as a music studio. Ringo transfers to Mick Jagger. Jagger wants to convert premises to a bowl-a-rama. Can Jagger do that? No, not w/out violating the condition.
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(b). | Mick Jagger rule of real property: You can't always get what you want.
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(3). | Yes, future interest: Possibility of reverter—exists in O, the grantor.
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(a). | This comes up all the time on exams and on the bar.
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(b). | FSD, POR = Fee Simple Determinable, Possibility of Reverter (or: Frank Sinatra Didn't Prefer Orville Reddenbacher)
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c. | Fee Simple on Condition Subsequent (FSCS)
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(1). | Language to create: "To A, but if X event occurs, grantor reserves the right to reenter and retake." Two specific requirements:
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(a). | Grantor must use clear, durational language.
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(b). | Grantor must carve out the right to reenter.
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(c). | i.e: Ross conveys to Rachel, but if coffee is ever consumed on premises, grantor reserves right to reenter and retake.
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(2). | Distinguishing characteristics: It's devisable, descendable, and alienable—always subject to the condition.
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(a). | This estate is not automatically terminated if condition occurs, but it can be cut short at grantor's option.
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(b). | The Bobby Brown of estates: "It's my prerogative." If I want I'll terminate you.
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(3). | Accompanying future interest: Yes. Grantor has the right of reentry, aka: the power of termination. This right is discretionary, not automatic.
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d. | Fee Simple Subject to Executory Limitation (FSSEL)
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(1). | Language to create: "To A, but if X event occurs, then, to B."
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(a). | i.e.: To Barry Manilow, but if Manilow ever performs music on the premises, then to Mandy.
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(2). | Distinguishing characteristics:
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(a). | Just like the FSD (fee simple determinable), except here, if the condition is broken, the estate is automatically forfeited in favor of someone other than the grantor.
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(b). | Forfeiture is automatic. If Manilow sings, Mandy gets it.
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(3). | Accompanying interest: Yes. It's called "the shifting executory interest."
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e. | For all of above, the difference between "automatic" and "discretionary" reversion of rights to grantee is only really important for SOL w/adverse possession. If the reversion is automatic, and grantee breaks condition but stays on the property, the SOL for adverse possession starts immediately at that time (whether grantor does anything or not). If the reversion is discretionary, the SOL for adverse possession doesn't start until grantor tells grantee that grantor is taking back rights.
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a. | Language to create: "To A for life."
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(1). | Must be measured in explicit lifetime terms, and never in terms of years.
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(2). | i.e.: The "Romantic" Estate—"I will love you all my life." (not for 50 years)
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(3). | "To A for 60 years if she lives that long" is not a LE. You'll have a term of years, a leasehold interest.
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(4). | Variation: Life Estate Pur Autre Vie—a life estate measured by a life other than the grantee's.
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(a). | Language to create: "To A for the life of B."
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b. | Distinguishing characteristics:
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(1). | Rooted in the concept of waste. Life tenant's entitlements are linked inextricably to doctrine of waste.
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(2). | Life tenant is entitled to all ordinary uses and profits from the land.
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(3). | Life tenant must not commit waste, meaning he/she must not do anything to harm the future interest-holders.
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c. | Accompanying interest: If the interest is held by O, the grantor, future interest is called a "reversion." If held by a 3rd party, the future interest is a remainder.
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d. | Waste Doctrine: As a current life tenant, you have an obligation to the future interest holder not to alter the land for better or worse: Three types of waste:
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(1). | Voluntary or Affirmative Waste: Actual, overt conduct that causes a decrease in value. (overt destructiveness)
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(2). | Permissive Waste (neglect): Occurs when land is allowed to fall into disrepair, or life tenant fails to reasonably protect the land.
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(a). | Life tenant must maintain premises in reasonably good repair.
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(3). | Ameliorative Waste: Life tenant must not engage in acts that will enhance property's value, unless all future interest-holders are known and consent.
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(a). | Property law's attempt to honor sentimental value. Future interest holders may not want "improvements."
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(b). | Exception: Amerliorative waste is allowed if:
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I. | Radical and permanent change in the property surrounding the LE property
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II. | The property is valueless as is
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III. | Neither of the above are the LE holder's fault
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IV. | Property would be made more valuable by the change.
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e. | Life Estate and Adverse Possession: If A has LE, but during that LE, Z gains adverse possession, upon A's death, B who has remainder can successfully sue Z for ejectment.
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1. | Remainders—"To A for life, then B" gives A a LE and B a remainder. Created initially in someone other than the grantor, normally follows a life estate
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a. | Exectory interests: Look a lot like remainders but don't have to follow a life interest or fee tail.
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b. | Vested Remainders: one where there's no condition that must be satisfied before remainder can become possessory other than the fact that the preceding life estate has to expire.
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c. | Contingent remainders: one where there's something the future interest holder has to do or be in order to perfect his future interest in the property. Also subject to the Rule Against Perpetuities (RAP)
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d. | We care about the difference between vested and contingent remainders because:
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(1). | Sometimes you need to know in order to interpret an ambiguous grant. Browning v. Sacrison (which we don't need to read)
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(2). | At common law there were rules about conveying contingent remainders that didn't allow you to convey contingent remainders while you were living. (These rules have changed and we don't need to worry about them.)
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(3). | Doctrines of destructibility and merger apply in a particular way to contingent remainders.
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(4). | Contingent remainders are subject to the rule against perpetuities.
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2. | Reversions: Reversions are always vested. Sometimes this doesn't make sense, but it's the rule anyway.
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a. | 1. To A for life, remainder to B if he survives A.
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(1). | B has a contingent remainder. B must survive A to get anything.
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(2). | If B doesn't survive A, then rule of conservation of estates says the interest will revert to the grantor. There's an implied reversion.
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(3). | You only know for sure that B has survived A when A dies. That means that these interests vest when it becomes possessory.
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(4). | B's remainder will be destroyed if B doesn't survive A.
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b. | 2. To A for life, remainder to B if he shall have reached the age of 21 by the time the life estate expires.
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(1). | A has a vested life estate. B has a contingent remainder. B has to be 21 years of age by the time A dies. If this doesn't happen, there's an implied reversion to the grantor.
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(2). | B's remainder could vest sooner than A's death. If B turns 21 before A dies, then B's contingent remainder would become a vested remainder.
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(3). | B's remainder will be destroyed if B is not 21 (or older) by the time of A's death.
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c. | 3. To A for life, remainder to B when he reaches 21.
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(1). | Doctrine of destructibility (or counter-intentional destructability): If B is 19 when A dies, a fair reading of the grant suggests the grantor intends B to get the interest in 2 years. This is what modern jurisdictions do.
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(a). | But common law said if B has not fulfilled condition at time of A's death, B's remainder is destroyed.
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(b). | This is not doing what the grantor seemed to want.
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(c). | Why the common law had the rule of counter-intentional destructiblity: Because it opens a period of time where ownership seems uncertain (the two years between A dying and B turning 21). So the goal was to make land more freely alienable by limiting the amount of time during which these conditions existed.
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(2). | Today, if B is 19 when A dies, then remainder reverts to G as an executory interest. Then, if B turns 21, B takes the interest (it becomes a present fee itnerest).
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(a). | Modern law abolished the rule of counter-intentional destructiblity because we want to protect and fulfill the grantor's wishes and we're less worried with the free alienability of land.
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(b). | The rule against perpetuities comes into play to make sure that the period of uncertainty of ownership doesn't last too long.
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d. | 4. To A for life, remainder to B.
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(1). | A has a vested life estate.
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(2). | B has a vested remainder. That means it's alienable and inheritable.
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e. | 5. To A for life, then to B for life, remainder to C. (Assume that A is 21 at the time of the grant and B is 97.)
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(1). | Here B has a vested life estate, although he's unlikely to ever get it.
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(2). | Remainder to C is also vested.
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4. | Merger Doctrine: (see handout p#16, p. 410):
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(1). | G grants to A for life, retains the reversion and subsequently conveys the reversion to A.
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(a). | This means A first gets a life estate, then later gets the reversion from the life estate. This means, in the end, A owns all interests in the land; those interests merge into one—a fee simple absolute.
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(b). | LE + Reversion = FSA
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(c). | LE + Remainder = FSA
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(2). | G grants to A for life, then to B if he shall have attained the age of 21, and retains the reversion; G subsequently conveys the reversion to A.
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(a). | A has a life estate.
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(b). | B has a contingent remainder.
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(c). | Then A gets the reversion.
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(d). | Common law said: the fact that A owns the life interest and the reversion means B's contingent remainder gets squeezed out (merged into A's interests).
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(e). | This is counter-intentional merger: Unwittingly, the grantor destroyed B's contingent remainder.
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b. | Modern jurisdictions have abolished counter-intentional merger (2nd problem above) to protect the intention of the grantor.
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5. | Rule Against Perpetuities: (p. 428): A rule against perpetual uncertainty about property rights; it invalidates future interests that vest too remotely.
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a. | The rule: The Rule Against Perpetuities requires that a future interest (created in a person other than the grantor), if it is to be valid, must vest (if it is a remainder) or become possessory (if it is an executory interest) no later than a period equal to 21 years plus the duration of some life in being at the time of the conveyance, from the date of the conveyance, if it is to vest at all.
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b. | Strategy (see handout):
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(1). | Is there a contingent interest?
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(2). | Is there a life in being at the time of the grant we can measure by?
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(3). | If not, is there another grant we can measure by?
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(1). | Another device like destructibility and merger designed to limit grantor's ability to impose conditions on the ownership of land. It says you can impose restrictions on the ownership of land, but only for a certain time period—a life in being plus 21 years.
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(2). | You violate the RAP by creating uncertainty in title that may last too long. You don't violate the rule if we know for sure the interest won't vest. It's a rule against perpetual uncertainty.
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(3). | Need only worry about the RAP with contingent remainders and executory interests.
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(4). | Consider grant: To A for life, remainder to B when he becomes the first person to walk on mars.
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(a). | This creates a risk that the contingent remainder could last potentially forever.
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(b). | How long should we allow title to remain uncertain?
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(5). | The same problem arises when we create a fee simple subject to an executory limitation: To A for life so long as A doesn't open a gas station, then to B.
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(a). | The condition could last forever, because the interest wouldn't go to B until A or his heirs opened a gas station, which they might do at any time, or never.
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(b). | This again creates a potentially indefinite condition that makes title uncertain.
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(6). | Rule against perpetuities tries to confront this problem directly. It's a rule against perpetual uncertainty. If we know the interest is not going to vest, we haven't violated the rule. It's only when we're unsure that we violate the rule.
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(1). | 1. To M for life, and then if she survives M, to JS and her heirs.
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(2). | 2. When you have an interest that violates the RAP, if the previous interest is a life estate, then reversion to grantor. If previous interest is a FSSEL, then we get a possibility of reverter in the grantor.
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(a). | Life estate is followed by a contingent remainder...
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(b). | This grant would not have violated the rule in a common law jur. that had the law of counter-intentional destructability. ??
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(3). | Note: For purposes of RAP, you can use a measuring life of someone who's not part of the grant, but only if you name them. See example on Supp,p. 71, #5.
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VIII. | Concurrent Estates (law of co-ownership): Three types of concurrent estates
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A. | Joint Tenancy (JT): Two or more own w/the right of survivorship.
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1. | Distinguishing Characteristics:
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a. | Right of survivorship—when one joint tenant dies, his share passes automatically to the surviving joint tenants.
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b. | A joint tenant's interest is alienable; however, it is not devisible or descendable (b/c of right of survivorship).
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c. | The Destiny's Child Tenancy: "I'm a survivor, I'm gonna take yours, I'm a survivor, I'm gonna keep yours."
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a. | First, you must have the four unities: TTIP = Tenants must take interests at the same Time, by the same Title, with Identical, equal interests, and w/identical rights to Possess the whole:
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(3). | Identical, equal interests
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(4). | identical rights to Possess the whole
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b. | Grantor must also clearly express the right of survivorship.
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c. | Law requires all these hoops because law disfavors joint tenancies. JT can avoid probate and law doesn't like that.
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d. | To create, you often need to use a Strawman:
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(1). | i.e.: Dave owns Blackacre in FSA, but he wants to own it as a JT w/his best friend Paul. How can Dave accomplish that result?
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(a). | Dave can't just transfer to himself and Paul as a JT because of 4 unities.
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(b). | Dave must use two pieces of paper:
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I. | 1) Dave conveys to Strawman (Dave's attorney, a friend, whatever).
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II. | 2) Straw conveys back to Dave and Paul as JTs w/the right of survivorship.
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3. | How to sever a JT: Two principle options:
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(1). | A JT can sell or transfer her interest during her lifetime. She may even do so secretly, w/out other JTs' knowledge or consent.
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(2). | One JT's sale severs the JT as to the seller's interest (b/c it disrupts the 4 unities). Result: Buyer becomes a Tenant in Common. Other JTs remain JTs; the JT remains in place for them. This is frequently tested.
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(3). | Hypo: O conveys Blackacre to Phoebe, Ross and Monica as JTs w/the right of survivorship. Each owns a presumptive 1/3 share (same time, title interests, right to possess whole). Phoebe sells her interest to Chandler. What result?
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(a). | Phoebe's sale severs JT as to her interest. Chandler becomes a Tenant in Common, holding 1/3. Ross and Monica remain JTs—they each still hold 2/3 as JTs.
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(4). | Hypo 2: Suppose Ross dies, leaving Rachel as heir. What result?
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(a). | Monica takes Ross's share. Ross and Monica were still JTs w/right of survivorship. Monica now holds 2/3, Chandler holds 1/3; they are tenants in common. Rachel gets nothing.
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b. | Partition—three variations (all available w/Tenancy in Common, as well):
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(1). | Voluntary Agreement: An allowable, peaceful way to end the relationship.
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(2). | Partition in Kind: A judicial action for physical division of Blackacre, if in the best interests of all. (Works best for actual land, not so much for a building.)
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(3). | Forced Sale: A judicial action if in best interests of all, where land is sold and proceeds are divided proportionately. (Works best for a building or something that doesn't lend itself to easy physical division.)
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B. | Tenancy by the Entirety (TbyE): A protected marital interest between H and W, with the right of survivorship. (Recognized in roughly 21 states today.)
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a. | Can only be created by husband and wife, who share the right of survivorship.
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b. | In jurisdictions that recognize TbyE, it arises presumptively in any conveyance made to H and W, unless clearly stated otherwise.
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2. | Distinguishing characteristics: The MC Hammer Tenancy: You can't touch this. It's a highly protected form of co-ownership.
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a. | Creditors of only one spouse can't touch the tenancy.
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b. | Neither tenant acting alone can defeat the right of survivorship by a unilateral conveyance to a 3rd party.
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C. | Tenancy in Common: Two or more own, w/no right of survivorship.
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a. | Each co-tenant owns an individual part, and each has a right to possess the whole.
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b. | Each interest is descendable, devisable, and alienable. There are no survivorship rights between tenants in common.
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c. | Presumption favors tenancy in common.
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2. | The Natalie Cole Tenancy: I'm Devisable.
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D. | Rights and Duties of Co-Owners (for all above tenancies unless otherwise noted)
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1. | Hypo to illustrate the following rules: Greg and Marsha own Blackacre as co-owners. Greg gave 90% of purchase price, Marsha gave 10%.
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a. | Presumptively they're tenants in common b/c they own different shares, but these rules apply to other tenancies as well
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2. | Possession: Each co-tenant is entitled to possess and enjoy the whole. One tenant cannot partition the property and exclude other co-tenants from it. If one co-tenant wrongfully excludes another, he has committed wrongful ouster.
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3. | Rent: Absent ouster, a co-tenant in exclusive possession is not liable to the others for rent.
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a. | Suppose Marsha leaves for three months on vacation. Does Greg owe her rent if he stays? No.
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4. | Rent from 3rd parties: A co-tenant who leases all or part of the premises to a 3rd party must account to his co-tenants, providing them their fair share of the rental income.
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a. | Suppose Greg leases basement apt. to Alice. Is Marsha entitled to portion of rental income? Yes.
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5. | Adverse Possession: Unless he has ousted the other co-tenants, one co-tenant in exclusive possession for the statutory adverse possession period cannot acquire title to the excluse of the others.
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a. | Suppose Marsha leaves for 20 years. Can Greg acquire full title in her absence? No.
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b. | Hostility element of adverse possession is missing. There's no hostility when there is no ouster.
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6. | Carrying Costs: Each co-tenant is responsible for his/her fair share of carrying costs (taxes, mortgage interest payments, etc.), based on his/her undivided share.
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7. | Repairs: The repairing co-tenant enjoys a right to contribution for necessary repairs, provided she has told the other co-tenant of the need for he repairs—based on proportionate share.
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a. | Suppose a football goes through the window and Marsha tells Greg about it, then pays to fix the window. Does Greg have to compensate Marsha for the repair? Yes.
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8. | Improvements: During the life of the co-tenancy, there is no right to contribution for so-called improvements. However, at partition, the improver gets a credit equal to any increase in value caused by her efforts. The so-called improver bears full liability for any decrease in value caused by her efforts. (The "upside/downside doctrine." At partition, improver gets credit for any upside of improvements, but bears full cost of any downside.)
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a. | Suppose Marsha wallpapers the den, Can she make Greg pay his fair share? No. One co-tenant's "improvement" could be another's nightmare.
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9. | Waste: A co-tenant must not commit waste. A co-tenant can bring an action for waste during the life of the co-tenancy. He/she doesn't have to wait for partition. Be on the lookout for this.
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10. | Partition: A JT or T in Common has right to bring an action for partition. (To disolve a TbyE we'd look to a divorce proceeding.)
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A. | Statute of Frauds as applied to tenancies:
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1. | Most leases must be in writing.
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2. | Exception for some leases of less than three years (or in some jurs. less than one year) "from the making thereof."
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a. | This language can create a problem because the term is from date of signing to end of lease term; which means that if you sign a 1-yr lease prior to the start of the lease, the lease will be for more than a year for purposes of the SOF.
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b. | Other states uses language that require a lease that's for exactly one year to be in writing, and anything for more or less to not require writing. This can create more problems.
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3. | If someone enters an oral lease that should have been in writing:
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a. | If lease is still executory (it hasn't started yet; neither party has begun to perform), the lease is void. Both parties can just walk away.
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b. | If the lease has begun (tenant has moved in):
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(1). | Most states will call this part performance and transmute it into a periodic tenancy, making the period the interval at which rent is paid, e.g. month-to-month.
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(2). | If the oral agreement specified a period for which rent was reserved, some jurs. will make the period of the periodic tenancy the period for which rent was reserved (i.e. a year).
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(3). | Other states will just make it the longest oral lease the law allows (i.e. one year).
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(4). | If ct. does any of these things, the other terms of the lease (i.e., amt. of rent) will still apply.
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B. | Four Leasehold interests (the non-freehold estates):
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1. | Tenancy for Years (Estate for Years, Term of Years)
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a. | A lease for a fixed, determined period of time (1 day to 50 years or more). When you have termination date from start, you have a TforY.
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b. | B/c the term of years tells us from the start when the leasehold will end, no notice is necessary to terminate.
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c. | A term of years greater than one year must be in writing to be enforceable (b/c of SOF).
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d. | Three possible time periods might be mentioned:
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(1). | Term of lease: amt of time from beginning to end
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(2). | Period for which rent is reserved: can be entire term, or a part
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(3). | Monthly installments of rent
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a. | A lease that continues for successive or continuous intervals, until LL or T give proper notice of termination.
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(1). | i.e.: "To T from month to month" or "To T from year to year" or "To T from week to week."
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b. | Notice must be given to terminate the periodic tenancy. At common law the notice had to be given prior to actual termination; the period was at least equal to the period of lease itself, unless otherwise agreed. I.e.: a week-week periodic tenancy required one week's notice.
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(1). | If tenancy is from year/year or greater, only 6 months notice is required (at CL)
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(2). | Parties can vary the period required for notice by contract.
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(3). | At CL, LL had right to renew or not for any or no reason. That right limited today in most jurs (can't terminate based on discrimination, also retaliatory eviction usually barred).
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a. | A tenancy for no fixed period of duration.
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b. | i.e: "To T for as long as LL or T desires."
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c. | At least theoretically, it may be terminated by either party at any time.
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(1). | By statute in most states, a reasonable demand to vacate is typically required.
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4. | Tenancy at Sufferance:
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a. | Created when T has wrongfully held over past the expiration of the lease. T is a holdover.
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b. | This leasehold is a mechanism to allow the LL to collect rent from the holdover.
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c. | TS is short-lived; lasts only until L either evicts T or elects to hold T to a new term.
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C. | Assignment v. Sublease: Unless the lease says otherwise, the law allows a T to transfer her interest.
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1. | Assignment: When T transfers her interest in whole, she has accomplished an assignment. Legal Consequences:
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a. | Hypo: T1 has 10 months left on a 2-yr term of years lease and transfers all 10 to T2. This is an assignment.
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b. | LL and T2 are in privity of estate, meaning LL and T2 are responsible to each other for all promises in original lease that run w/the land. Most promises in original lease will run w/the land—promise to pay rent, repair, pay taxes, etc.
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c. | LL and T2 are not in privity of contract unless T2 expressly assumes all promises in original lease.
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d. | LL and T1 are no longer in privity of estate.
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e. | LL and T1 remain in privity of contract, meaning LL and T1 are secondarily liable to each other.
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f. | Hypo 2: LL rents to T1, T1 assigns to T2, T2 assigns to T3. T3 then engages in active waste.
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(1). | Can LL proceed against T3, the direct wrongdoer? Yes, b/c of privity of estate.
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(2). | Can LL proceed against T1, the original tenant? Yes, b/c of privity of contract—T1 is secondarily liable to LL. This means that if T3 is unavailable or bankrupt or otherwise judgment-proof, T1 is liable.
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(3). | Can LL proceed against T2? No. Privity of estate ended once T2 assigned to T3, plus there was never privity of contract (unless you've been told that T2 expressly assumed all promises in original lease).
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2. | Sublease: If T transfers only a portion of her leasehold interest to someone else, she has accomplished a sublease. Legal consequences:
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a. | LL and sublessee are in neither privity of estate nor contract.
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b. | T2 is responsible to T1, and vice versa.
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D. | LL/T Relationship At Common Law (based on doctrine of independent covenants—one party's breach does not excuse the other party from its obligations):
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1. | T's duties & rights at CL:
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a. | Duty to repair and maintain: Baseline standard: T is responsible for keeping the premises in reasonably good repair. T must not commit waste.
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(1). | The Doctrine of Waste is linked inextricably to the law of Fixtures: When a tenant removes a fixture, he commits voluntary waste.
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(a). | A fixture is a once-moveable chattel (thing) that, by virtue of its attachment to realty, objectively shows the intent to permanently improve the realty.
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(b). | common examples of fixtures: heating systems, customized storm windows, a furnace, certain lighting installations
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(c). | T must not remove a fixture, no matter that she installed it. Fixtures pass w/ownership of the land. This is frequently tested.
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(2). | Two ways to know if a T installation qualifies as a fixture:
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(a). | The parties' private agreement on the matter is binding and controls. If T negotiated ahead of time that X was not a fixture, T can remove it.
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(b). | In the absence of agreement, T may remove her installation so long as removal does not cause substantial harm to the premises.
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(c). | If removal will cause substantial harm, then, in objective judgment, T has shown the intention to install a fixture; the fixture in this case must stay put.
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c. | Constructive eviction (CE): The only way a T could be excused from paying rent at CL. (see below)
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d. | T has right to quiet enjoyment; look to lease for express guarantees provided by LL; housing code irrelevant (doesn't create a right)
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2. | LL's Duties & Rights at CL:
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a. | Duty to deliver possession: LL must put T in actual physical possession of the premises. If prior holdover is still there at start of T's lease, LL is liable. (See Holdover doctrine below)
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b. | Duty to disclose latent defects not reasonably discoverable by T
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c. | No implied warranties: No implied duty to repair and maintain; no implied warranty of habitability at Common Law.
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d. | No acceleration—LL could sue for rent as it became due, but there was no acceleration allowed so LL could only sue periodically for installments or wait for end of lease and sue for full amt.
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e. | Implied covenant of quiet enjoyment. Applies to both residential and commercial leases—even at CL!. A fundamental, implicit promise that every LL makes: T has a right to quiet use and enjoyment of the premises w/out interference from LL.
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(1). | LL can breach two ways:
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(a). | By actual wrongful eviction or exclusion.
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(b). | Breach by Constructive Eviction (CE). Elements of CE = SING
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(2). | LL generally not responsible for the bothersome conduct of other Ts. Two exceptions:
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(a). | LL has a duty not to permit a nuisance on the premises. I.e., if LL rents apt. above you to a dance troupe and the noise drives you nuts, LL is liable.
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(b). | LL has a duty to control and police common areas.
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E. | LL/T Relationship in Reformed Jurs (doctrine of dependent covenants)
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1. | T's duties & rights in reform:
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a. | No duty to repair/maintain. T just must pay rent and not trash the place. Enjoys right to warranty of habitability and quiet enjoyment; LL has duty to repair and maintain.
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b. | Rent Abatement: If T withholds rent for LL's breach (as Javins suggests is ok), and a ct. finds that LL has violated an implied covenant of habitability, then T may be able to get some rent back. There are three main formulas to caculate amt. of rent abatement (FMV = fair market value):
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(1). | 1. Abate by amt. of rental rate minus FMV as is. This is the same as reducing the rent to the FMV. But if rent was already no more than FMV, this won't help T at all. Can be very good for LLs.
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(2). | 2. Abate rental rate by amount of FMV as warranted (w/no violations), minus FMV as is. This can be more favorable to Ts.
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(3). | 3. % abatement of actual rent: abate to FMV as is, divided by FMV as warranted, times rental rate.
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c. | Remedy of repair and deduct: Limited to a reasonable repair w/in the rental unit (not building-wide repairs). Most jurs have dollar-amt. limitations, something like half a month's rent.
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a. | Implied covenant of quiet enjoyment still applies.
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b. | Implied warranties of habitability (Lemle—the rat case) and duty to repair and maintain cannot be waived. Look to housing code for violations.
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c. | LL has ongoing duty to repair and maintain. Javins.
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d. | LL has duty to mitigate damages
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F. | Termination of Leaseholds:
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1. | When T is in breach of the duty (hasn't paid rent) and still in possession of premises, LL has two options:
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a. | Evict through the courts and sue for rent owed. LL has no duty to mitigate.
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(1). | Ejectment—still available but too slow
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(2). | Summary Eviction (p. 699) The modern way we encourage LL to evict for non-payment of rent.
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b. | Continue the relationship w/this tenant, and sue for the rent owed.
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c. | Note: LL must not engage in self-help: LL must not change the locks or forcibly remove T or any of T's possessions. Self-help is punishable civilly and criminally. (Some LL self-help was allowed at CL called "distress" or "distraint.")
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2. | When T is in breach of the duty but is no longer in possession of premises (when T wrongfully vacates/abandons w/time left on a lease): SIR
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a. | S = Surrender: LL can choose to treat T's abandonment as an implicit offer of surrender which LL accepts. T is off the hook except for any rent past due at time of surrender. LL can relet premises; if new rent is less than what abandoning tenant was paying, tenant is not liable for the difference unless the tenant had explicitly covenanted not to abandon.
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(1). | Surrender means that T demonstrates by words or conduct that she wishes to give up the leasehold.
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b. | I = Ignore: LL can ignore the abandonment and hold T responsible for rent, just as though T were still there.
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(1). | This option available only in a minority of states.
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(2). | There was no duty on LL's part to mitigate damages (by attempting to relet)
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c. | R = Relet: The LL can re-let premises on T's behalf and hold T liable for any deficiency.
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(1). | Majority rule: LL must at least try to relet. LL must be duly diligent in at least attempting to find a substitute tenant. (LL must make a good faith effort to mitigate losses.)
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3. | Grounds for lawful termination by T
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a. | Expiration of leasehold
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b. | Retaliatory eviction: If T lawfully reports LL for a housing code violation or similar (if T is a good faith whistleblower), LL is barred from penalizing T. Edwards v. Haibib—D.C. Circuit departed from common law rule that LL could terminate periodic tenancy by giving timely notice where it appeared LL was evicting T as retaliation against T because T had reported LL to health & housing authorities.
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(1). | Edwards v. Haibib was radical when decided, but now it's a rare state that doesn't have some form of retaliatory eviction defense. There are many differences and ambiguities in the different statutes:
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(a). | Some say T doesn't have to be right in his complaints; LL can't retaliate so long as T is reporting violations in good faith. The point is to prevent T from harassing LL w/unfounded or frivolous housing code violation complaints.
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(b). | Other triggers of the retaliatory eviction defense:
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I. | Some jurs say if you complain to LL, that's protected.
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II. | If you form a tenant's union, some protect that.
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III. | If LL turns of your heat in the middle of the winter, some protect that and treat it as a retaliatory eviction move.
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(c). | Evidentiary problem: In almost every case, the LL is not likely to admit he's evicting for retaliation, so there's a problem of proof. So most statutes create a rebuttable presumption of retaliation if LL terminates w/in a fixed time period from an action by T. After that time period, that presumption flips: it becomes a rebuttable presumption that the LL acted lawfully and not in retaliation.
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(2). | If you complain that your LL is punishing you because of something outside the LL-Tenant relationship (i.e., because you're a union member or a Bush supporter), most jurs say there's no Constitutionally-based retaliatory eviction doctrine.
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(3). | Final ambiguity: Some jurs have extended this defense to an estate for years that LL declines to renew. (Edwards was about a periodic tenancy, and that's what most retaliatory eviction statutes apply to.)
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c. | Constructive Eviction (CE): Elements = SING
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(1). | If LL acted intentionally to decrease T's use and enjoyment, or took action that foreseeably would drive T out, then T will likely succeed in CE claim.
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(2). | If LL failed to act (non-feasance) despite T's complaints, then check to see if the following are satisfied:
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(a). | LL had duty independent from the covenant of quiet enjoyment (look at lease; must be independent source of duty)
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(b). | That duty is assimilated to quiet enjoyment—do the Charles Burt test: Was the promise a significant inducement for the T to enter the lease?
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(3). | If T thinks LL has done something that T thinks it's a CE, T must:
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(b). | Give notice: T must give LL notice of the problem and LL must fail to respond meaningfully.
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(c). | Leave premises promptly if LL doesn't act. (This traditional approach was bad for Ts because if they stopped paying and moved out, but then a ct. disagrees that this was a CE, then T would still have to pay._
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(4). | If CE fails (ct. says the breach did not amount to CE):
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(a). | If T abandons and there's no CE, T is responsible for rent for the duration of the full lease, or if LL finds a new renter who agrees to pay less rent, T is responsible for for difference between T's rent and what the new renter pays.
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(b). | At CL, if T is liable for full rent, LL must either sue month-to-month as rent comes due (no acceleration at CL), or wait to end of lease to sue for full rent.
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(c). | If T isn't sure whether a CE claim will succeed, in some jurs. T can first seek declaratory judgment before moving out.
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(5). | Cases: Phyfe (classic CE case) & Charles Burt v. Seven Grant
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(a). | Phyfe v. Dale, 1911 (p. 725—classic constructive eviction case; T abandons and stops paying rent, LL sues, T claims CE as a defense. Ct. says: T can abandon and stop paying rent when LL allows prostitution, public drunkenness, etc. in the elevators and public hallways of his building even after T asks LL to make these things stop. LL's inaction amounts to CE.
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(b). | Charles E. Burt, Inc. v. Seven Grand Corp. 1959 (p. 92 supp—A variation on CE: T is suing LL for declaratory judgment that lease is void, and for damages. This allows T to find out if he's going to succeed on his CE claim before he actually abandons his lease. Ct. found for P(T): Ct. said the heat and electricity and elevator service were assimilated to quiet enjoyment because these "go to the essence of what the landlord is to provide." Bert shows that CE can help T, but still does nothing for T who has no place better to go and would just like to stay on premises and get problems fixed.
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d. | Illegality Doctrine: If lease is illegal (see circumstances below), it can't be enforced against T. Illegality defense works reasonably well for T when T wants to terminate and get out of lease. However, a T who just wants to stop paying rent and not leave, may not want to try to invoke illegality. But a T who wants to leave may also be able to invoke the CE doctrine.
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(1). | Circumstances under which a lease may be illegal, and different judicial responses to them. (See supp 101-103):
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(a). | Violations of a prohibition on leasing—housing code says you can't rent apt. w/no heat, but you do it anyway; you've violated a prohibition on leasing. This is the strongest case, but relatively rare.
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(b). | The use is illegal at the time of leasing and... (most cases fall into this situation somehow)
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I. | Both parties knew—conspiracy to lease for an impermissible purpose (supp 102)
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II. | Only one party knows—fraudulent concealment of illegality of use
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III. | Niether party knows—mutual mistake of law
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(c). | The use becomes illegal after leasing: frustration of purpose (Walker). Some jurs. differentiate btwn. leases that prohibit all but the forbidden activity, and those that don't have such prohibitions. If the lease is limited to a single use that's illegal, you'll generally have a stronger case that the lease is illegal.
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(2). | Remedies if lease is found to be illegal:
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(a). | Bilateral unenforceability—typically what courts have in mind when they describe a lease as void, as if it's not even there. LL can't collect rent, but T has no rights against LL, either.
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(b). | Unilateral unenforceability—court figues out who's to blame; that party can't enforce the lease, but the other one can.
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(c). | Unclean hands—also requires an assessment of blame, but it could be on both sides or one-sided, but this says ct. will not grant a judicial remedy in favor of a party who is somehow responsible for illegality. This often applies when a party uses self-help to remedy the other party's initial breach, so that by the time this comes to court everyone has "unclean hands."
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(3). | Walker v. Southern Trucking Corp., 1969 (p. supp. 97—lease unenforceable for mutual mistake of law where lease stipulated a use that was made illegal by zoning; remedy is under theory of bilateral unenforceability)
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(4). | Brown v. Southall Realty Co., 1968, DC Ct. of App. (p. 730—lease unenforceable due to violations of prohibition on leasing (but also could have been unenforceable under fraudulent concealment on the part of the landlord who entered lease knowing of housing code violations)—remedy is unilateral unenforceability against the LL, leaving T in posssession; T should be able to get back any rent he paid)
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(5). | Walker is an example of very traditional setting for illegality case, while Brown v. Southall is expanding the doctrine.
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e. | Implied Warranty of Habitability: Premises must be fit for basic human habitation; bare living requirements must be met (at time of signing lease).
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(1). | Did not apply at CL! Applies only to residential leases. (Commercial leases have implied warranty of fitness for indended purpose.)
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(2). | Non-waiveable; a T cannot modify or displace this entitlement.
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(3). | Appropriate standard could be satisfied by Local housing code or Independent judicial conclusion.
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(4). | Examples of breaches: failure to provide heat in winter, lack of plumbing, lack of running water.
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(5). | T's entitlements if LL breaches implied warranty of habitability: Mr. Cubed (MRRR)
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(a). | M = Move out and terminate the lease.
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(b). | R = Repair and deduct. Allowed by statute in a growing number of states.
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(c). | R = Reduce rent or withhold all rent until ct. determines fair rental value. Typically T must place withheld monies in escrow to show good faith.
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(d). | R = Remain in possession, pay rent, and sue for money damages.
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G. | The Holdover Doctrine (p. 676)
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1. | When tenant fails to move out after end of lease or when lease terminates for any reason, landlord has option of treating tenant as trespasser and using eviction remedies, or allowing tenant to say and treating tenant as a holdover who has renewed lease as periodic tenancy for the period for which rent is reserved (usually year/year).
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2. | When Holdover doctrine may not apply
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a. | Courts today are more willing to say that some amount of time (less than a day, a few hours) the tenant stays beyond end of lease is just too short to invoke the holdover doctrine. Courts are also more willing to say that clauses in leases can replace the holdover doctrine. This is generally, however, one of the more draconian doctrines remaining in landlord tenant laws.
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b. | I'm sick and dead at the time my lease ran out—doesn't always work.
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c. | Estoppel doctrine: If good faith negotiations go right to end of lease but then they break down, most jurisdictions say the landlord has to allow reasonable time for tenant to vacate.
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3. | If landlord asks for more rent for next period of rental, and tenant says no but stays anyway, some jurisdictions will hold tenant to the higher rent.
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4. | Every holdover case where there's a dispute will invoke questions of abandonment also. If the landlord applies holdover doctrine, and tenant moves out and disputes the holdover, then abandonment questions arise.
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X. | Nuisance: The substantial, intentional, and unreasonable interference w/another’s use and enjoyment of land. Nuisance Law = Neighbor Law.
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1. | Injury to P's use and enjoyment of his land. Harm must be substantial. Depression of property values, odor, noise, obstruction of view, vibration, all can qualify as substantial harm.
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2. | Was the action unreasonable? (Pendoley)
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a. | Does the gravity of the harm outweigh its utility? (Coase)
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b. | Who has priority in time?
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3. | Did D intend to do the act and was the harm foreseeable? D's conduct must be intentional (D knew or should have known the use would interfere w/P's use/enjoyment of P's land.)
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B. | Remedies: Injunction always possible (free rider problem), conditional injunction becoming more common (Boomer v.Atlantic Cement)
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1. | Coase analysis: Who is the efficient user? Coase believes that the less efficient user should relocate; therefore, regardless of fault, the efficient user should stay. Problem w/Coase: If efficiency is defined too narrowly to mean only "how much money does the activity produce?" many problems can result. See history of 20th C. environmental degradation.
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2. | Rabin analysis: Who is at fault? Who used land as 2nd-in-time to create conflict w/1st-in-time? Depending on whose use made the two uses incompatible, the ct. should assign fault and if the non-guilty party relocates due to less efficiency, he should be compensated by more efficient but guilty party.
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XI. | Servitudes: Easements and Covenants
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A. | Defeasible Fees v. Covenants and Equitable servitudes: If you have a defeasible fee, a condition is stated, and if someone violates the condition, the ownership of the property can change. That's a radical consequence. If you violate a covenant or equitable servitude, the ct. grants an injunction or imposes fines.
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B. | Easement: The grant of a non-possessory property interest that entitles its holder to some form of use or enjoyment of another's land that is called "the servient tenement." Always construed in favor of grantee.
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a. | Affirmative easement: The right to go onto and do something on servient land. Most easements are affirmative, i.e.: The privilege to lay utility lines on another's land, or easement giving holder a right of way across another's land.
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b. | Negative easement: Entitles its holder to compel the servient holder to refrain from doing something that would otherwise be permissible.
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(1). | recognized in only four categories = LASS
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(a). | Light—refrain from doing something to block my light (i.e. the John Hancock building in downtown Boston is reflective because the Trinity Church has a negative easement for light over the Hancock building)
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(b). | Air—refrain from doing something to block my air
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(c). | Support—refrain from excavating or digging on your parcel in a way that would cause subsidence, etc. on my parcel.
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(d). | Streamwater from an artificial flow—refrain from doing something that would
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(e). | (A few jurisdictions (i.e. CA) allow a negative easement for a scenic view.)
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(2). | Negative easements can only be created expressly in a writing signed by the grantor. There's no natural or automatic right to a negative easement.
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c. | An easement is either appurtenant to land, or held in gross.
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(1). | An easement is appurtenant to land when it benefits the holder in his physical use or enjoyment of his property. It takes two—an easement is appurtenant when two parcels of land are involved:
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(a). | A dominant tenement which derives the benefit of the easement.
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(b). | A servient tenement which bears the burden of the easement.
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(c). | i.e.: A grants B a right of way across A's land (1—the servient tenement), so that B can more easily reach B's land (2—the dominant tenement). B has an easement appurtenant to B's dominant tenement. A's land is serving B's easement.
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(d). | Transferability: Appurtenant easements transfer automatically w/the dominant tenement, regardless of whether it is even mentioned w/the conveyance.
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(2). | An easement is held in gross when it gives its holder only a personal or commercial gain that is not related to his use and enjoyment of his land. Here, servient land is burdened, but there is no dominant tenement.
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(a). | i.e.: Right to place a billboard on servient land requires an easement in gross. Right to lay power lines on another's land, or to fish in another's lake, etc. —all easements in gross. Servient land is burdened, but there is no dominant tenement.
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(b). | Transferability: Easement in gross is not transferable unless it is for commercial purposes.
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I. | i.e: A has easement entitling her to swim in B's lake. This is not freely assignable or transferable.
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II. | If Starkist has easement entitling it to fish in B's lake for bait, that's commercial and transferable.
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2. | Four ways to create an affirmative easement: PINGR
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a. | P = Prescription: An easement may be acquired by satisfying the elements of adverse possession (A ECHO, all for given statutory period)
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(2). | E = Exclusive use for given statutory period
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(3). | C = Continuous use for given statutory period
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(4). | H = Hostile use, meaning w/out the servient owner's permission
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(5). | O = Open and Notorious use
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b. | I = Implication (by plat or prior use): Sometimes called the easement implied from existing use. Classic prototype:
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(1). | A owns 2 lots. Lot1 is hooked to sewer drain located on Lot2. A sells 1 to B, w/no mention of B's right to continue to use the drain on A's Lot2. The law may imply an easement on B's behalf if:
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(a). | the previous use had been apparent, and
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(b). | the parties expected that the use would survive division b/c it is reasonably necessary to the dominant land's use and enjoyment.
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(2). | Can also be implied from the plat (Putnam v. Dickinson)
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c. | N = Necessity: The landlocked setting—an easement of right-of-way will be implied by necessity if grantor conveys a portion of his land w/no way out except over some part of grantor's remaining land.
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d. | G = Grant: An easement to endure for more than one year must be in a writing that complies w/the formal elements of a deed b/c of the SOF. The writing is called a deed of easement.
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e. | Reservation: An owner retains a piece of what he/she formerly owned.
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3. | Scope of an easement: Set by the terms or conditions of the grant that created it. IOW, unilateral expansion of an easement is not allowed.
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C. | Covenant: A promise to do or not do something related to land. (Very different from easement. Begins as a mere contractual limitation regarding land.)
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1. | A restrictive (negative) covenant is a promise to refrain from doing something related to land.
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a. | i.e.: I promise not to build for commercial purposes on my land.
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b. | Negative covenants are necessary because negative easements are limited to the four categories of LASS.
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2. | An affirmative covenant is a promise to do something related to land, i.e: I promise to water our common garden or maintain our common fence.
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3. | Determining a covenant from equitable servitude. In problems, the facts will look similar, so how do you decide? Construe based on relief P is seeking.
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a. | If P wants money damages, you must construe the promise as a covenant. The covenant is a legal device, so it takes its remedies at law (money damages).
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b. | If P wants an injunction, you must construe the promise as an equitable servitude.
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4. | When will the covenant run with the land? When it is capable of binding successors?
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a. | Prototype: A promises B that A will not build for commercial purposes on A's property.
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(1). | One tract is burdened, the other is benefitted. Here, A's is burdened, B's is benefitted.
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(2). | Later, A sells burdened parcel to A1, B sells benefitted parcel to B1. A1 then builds for commercial purposes. B1 decides to sue A1 for money damages. Therefore, you construe the promise as a covenant.
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(a). | Does the burden of A's promise to B run from A to A1? In order for the burden to run, remember WITHIN:
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I. | W= Writing: Original promise between A and B must have been in writing.
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II. | I = Intent: Original parties, A and B, must have intended that covenant would run.
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III. | T = Touch and concern the land: The promise must affect the parties' legal relations as landowners (not simply as members of the community at large).
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IV. | H = Horizontal and vertical privity are both needed for burden to run.
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A. | Horizontal privity refers to the nexus btwn originally promising parties, A and B. Requires that A and B be in succession of estate, meaning they were in a grantor/grantee or landlord/tenant or debtor/crediitor relationship, or that they shared some servitude in addition to the covenant now at issue. Very difficult to establish.
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1. | Absence of horizontal privity is the reason why many burdens will not run with the land.
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B. | Vertical privity: Successor must have the same estate OR an estate of the same duration in the same property.
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V. | N = Notice: A1 must have had some notice of the promise when she took.
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(b). | Does the benefit of A's promise to B run from B to B1? Does B1 have standing to make this claim? WITV
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I. | W = Writing: Original promise between A and B must have been in writing.
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II. | I = Intent: Original parties must have intended that the benefit would run.
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III. | T = Touch and concern: the promise must affect the parties as landowners.
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IV. | V = Vertical privity: some non-hostile nexus btween B and B1.
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V. | Horizontal privity is not required for the benefit to run. Therefore it's easier for the benefit side of the equation to run than for the burden side to run. The law will more easily confer benefits than it will require burdens.
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5. | Who can enforce a covenant: S139
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a. | successors to the original promisee, who hold adjacent land that was owned by the promisee at the time of the promise: yes
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b. | the original promisee who no longer retains no land? no.
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c. | property owners association? often
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(1). | often the ass'n owns some of the land (i.e. the tennis courts), which gives them enforcement rights.
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(2). | ass'n can be given enforcement power expressly by covenant
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(3). | authority can by implied if there's property owned in common by the residents of the subdivision
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d. | local government? usually no, unless gov't owns a piece of benefited land.
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(1). | starts to blur zoning (public restrictions) and covenant law (private restrictions).
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(2). | some cities give gov't auth. to enforce covenants by ordinance
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6. | Effect of Changed Conditions on Restrictive Covenants: Covenants are perpetual so you can't generally end them. Outside changes (not on actual land) are not sufficient to end a covenant, but changes on the land may be sufficient to end a covenant if the intended purpose of the covenant is frustrated.
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a. | Estoppel/Enforcement: Occurs when every person who may enforce covenant tells you they won't enforce and you rely on that promise.
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b. | Camelback Del Este Homeowners Ass'n v. Warner, 1987 (p. 1002—
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(1). | P sues to prevent D from building offices on land that is covenanted to have only single-family dwellings.
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(2). | D argues that the neighborhood has changed since the covenants were made -- now there's lots more traffic and it's not plausible that anyone would want to live on these lots.
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(a). | Ct. does not think this is sufficient hardship to allow D to build offices.
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I. | Changed conditions doctrine or hardship doctrine says covenant will not be valid if things have changed so much it doesn't apply.
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II. | Ct. said that as long as community in the area is being used consistently w/the covenant in question, covenant still applies.
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III. | To win, D needed to show change within the area, not change outside the area.
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(3). | D also argues that homeowner's ass'n is estopped from enforcing the covenant by the fact that they
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(a). | Ct. said silence is not estoppel. Unanimity is required—everyone who has the benefit would have to be estopped for D to win on this argument.
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7. | Why covenants don't violate the rule against perpetuities?
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a. | RAP prohibits unduly remote vesting of ownership of property.
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b. | Covenants don't affect ownership at all; they just tell owners what they can/can't do with it.
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c. | Covenants are also never retroactive because then they could be takings.
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D. | Equitable Servitude: A promise that equity will enforce against successors. Accompanied by injunctive relief.
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1. | To create an equitable servitude that will bind successors: WITNES
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a. | W = Writing: Generally, but not always, the original promise was in writing.
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b. | I = Intent: The original parties intended that promise would be enforceable by and against assignees.
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c. | T = Touch and concern: the promise must affect the parties as landowners.
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d. | N = Notice: The assignees of the burdened land had notice of the promise.
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e. | ES = Equitable Servitude: Within the realm of the equitable servitude, privity is not required to bind successors.
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2. | The Implied or Reciprocal Equitable Servitude, aka the general or common scheme doctrine:
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a. | When prior purchaser buys a lot and promises grantor to restrict his use of the lot in accordance with the common plan. In response, the grantor promises to impose the same restriction on each subsequent buyer. In absence of express promises, court may infer them where there's evidence of a common plan as shown by surrounding land use and the understandings of neighbors.
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b. | Recognized in the vast majority of states, but a minority (eg MA) do not imply equitable servitudes—they require a writing.
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1. | A mere privilege to enter another's land for some delineated purpose.
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2. | No writing required; not subject to SOF; a much more informal species of servitude.
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3. | Licenses are freely revocable at will of licensor, unless estoppel applies to bar revocation.
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4. | Classic license cases:
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a. | The ticket cases: Tickets create freely revocable licenses.
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(1). | i.e.: You purchase tickets to theater, all other ticket holders are admitted except you. Can they do that? Yes.
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b. | Neighbors talking by the fence: Nothing good comes when neighbors are talking by the fence. (Oral promises only create freely revocable licenses.)
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(1). | Suppose A talking by fence w/B says "You can have that right of way across my front lawn." That oral easement is unenforceable—it violates the SOF. Instead, this oral easement creates a freely-revocable license.
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5. | Estoppel will apply to bar revocation, but only when licensee has invested substantial money or labor or both in reasonable reliance on the license's continuation.
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1. | Entitles its holder to enter servient land and take from it the soil or some substance of the soil (timber, minerals, oil, etc.).
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2. | Profits share all rules of easements.
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XII. | Zoning: Pursuant to its police powers, gov’t may enact statutes to reasonably control land use. Must be authorized by state action (i.e. a Zoning Enabling Act).
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A. | Generally Acceptable purposes of zoning: HMSWa (Health, Morals, Safety, general Welfare); not aesthetics.
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B. | Opposing party must show that the law is clearly arbitrary and unreasonable, not related to HMSWa. Zoning often challenged on the ground it exceeds the authority of the Enabling Act and is most often defeated by reference to its negative effect on property values.
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C. | Variance: the principle means to achieve flexibility in zoning. Permission to depart from the requirements of a zoning ordinance.
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1. | Proponent of area variance must show
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b. | that granting variance won't work detriment to surrounding property values.
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2. | Variance is granted or denied by a zoning board.
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D. | Non-conforming use: A once lawful, existing use now deemed non-conforming by a new zoning ordinance. The non-conforming use cannot be eliminated all at once unless just compensation is paid; otherwise it could be deemed an unconstitutional taking.
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XIII. | Takings (Imminent Domain): The Gov’ts 5th amendment power to take private property for public use in exchange for just compensation.
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A. | Explicit Takings: An act of governmental condemnation.
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B. | Implicit or regulatory taking: Gov't regulation that, although not intended to be a taking, has the same effect. Private landowner argues that gov't regulation has economically wiped out his investment. Remedy for regulatory taking: Gov't must either:
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1. | Compensate owner for the taking, OR
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2. | Terminate the regulation and pay owner for damages that occurred while regulation was in effect.
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1. | Possessory Taking: Is there a physical occupation? (if yes, then it's a taking)
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2. | Regulatory Taking: Is a gov't regulation somehow affecting property values?
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3. | Is the economic value of the property (look to economic unit) wholly (100%) wiped out by the regulation? (If yes, it's probably a taking unless it's a nuisance (Lucas); If no, see Keystone factors).
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a. | Lucas: If the regulation is to prevent nuisance, the it is not a taking; otherwise it is.
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(1). | What is the government's purpose for this action?
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(a). | To acquire a resource for gov't use—not a taking
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(b). | To prevent a CL nuisance—not a taking.
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(c). | To rearrange private rights w/out a public purpose
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(d). | To serve a public purpose of preventing public harm (but not preventing a C/L nuisance
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(2). | Does the regulation deprive the owner of a reasonable return on investment?
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(a). | Degree of singling out (higher degree means it's more likely a taking)
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(b). | Degree of reciprocity of advantage (lower degree means it's more likely a taking)
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(c). | Degree of qualitative restriction of use (higher degree means it's more likely a taking)
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XIV. | What Is Property Anyway? A second look.
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A. | Quick overview of two main questions:
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1. | 1) Why and when do we protect property rights?
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(1). | It's god's will that all be owned
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(2). | Ownership reduces disputes
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b. | Labor theory—reward labor
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(1). | Bentham—protect property rights and people's expectations and produce greater happiness (utilitarian)
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(2). | Economic version: efficient use of resources
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c. | Personality theory—protect individuality & liberty (see Hegel, Nestor)
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(1). | Possibly to protect privacy (in context of 4th amendment?)
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2. | 2) What kind of protection do we offer? How do we protect property rights? What powers and immunities do property rights give you against other people?
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a. | Right to exclude (Pierson v. Post)
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b. | Right to compensation for taking
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c. | Right to profits of work/investment (labor theory)
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d. | Right to stability/predictability in legal treatment (Circularity in arguments about protecting expectations; see Kaiser Aetna. People's expectations just aren't always clear, so it can be hard to protect them. Sometimes they're just whatever the cts. say they are.)
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e. | Protection from arbitrary decisions by gov't about your property, or from arbitrary classifications and discrimination
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f. | Right to a hearing (to decide factual issues related to your property); part of due process.
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g. | Protection of privacy from gov't'l snooping. (personality theory)—places where you have a property interest are presumptive zones of privacy (Right to exclude the gov't.)
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B. | Labor Theory—John Locke (natural law)
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1. | Natural law theory, universally valid, derived by reason from order of universe. People in state of nature own selves and labor power; when they put it to use in the real world, the things they acquire dominion over are also their property.
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2. | IOW: Human labor is the basis for property rights; property is acquired by application of human labor to the natural world.
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3. | A thing res nullis, when mixed w/labor, becomes property.
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4. | International News Servie v. AP—AP sought right to exclude INS from distributing news AP had collectedd. Ct. recognized limited right.
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a. | Brandeis Dissent: Labor theory doesn't confer property rights. There's a public interest in allowing and encouraging quick and free dissemination of news.
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C. | Utilitarian Theory—Bentham
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1. | Bentham said law owes to people protection of those things they expect to be protected. Follow precedent. Protect stability of expectations.
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2. | A good society makes the maximum number of people as happy as possible. Happiness is individual; increased individual happiness means increased social happiness.
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3. | Law should guarantee the expectations represented by property. Property is a creation of law, not natural rights; as such we should make law conform to what people expect property to be.
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4. | Demsetz' economic theory of property rights is related to utilitarian view:
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a. | Private ownership of land results in better, more efficient use of land than communal ownership.
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b. | Recognizing new property rights is a way of dealing with new costs/benefits.
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5. | Kaiser Aetna v. U.S.: navigational servitude—ct. said gov't had engaged in a taking when it forced KA to allow public to use its pond, even after KA had connected the pond to navigable waters. KA reasonably expected to exclude others, so law is protecting expectations.
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D. | Personality Theory—Hegel (classic idealist theory of property)
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1. | Property is the concrete embodiment in the real world of personality/individuality, autonomy, liberty. If you don't protect property, people can't flourish as individuals in the world.
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2. | Real freedom comes from worked-for acquisition of property
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3. | The redistribution of property (by gov't or anyone) is a challenge to human freedom
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4. | Property functions to safeguard against state attempts to limit human freedom. But property rights are not sacrosanct; they're inferior to the "general will" as manifested, for example, through a democratic state.
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5. | Flemming v. Nestor, 1960 (p.150—dramatic illustration of the purposiveness of property rights (the why do you want to know principle))
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a. | Issue: Whether SS benefits are property rights. Ct. says no, SS benefits cannot be an accrued property right. However, if ct. had found differently, then P would have been entitled to just compensation. This is how property rights protect liberty—even if you're a commie, you still have property rights. So property rights can protect unpopular political views.
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b. | The fact that P's rights weren't protected also demonstrates the fallacy of natural law and how property rights are easily manipulated to support the status quo.
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(1). | He says this was the kind of property right that can't be taken away.
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(2). | Also, you either have property rights or you don't. He doesn't like court splitting up different grades of property rights. He supports the agglomerative tendency.
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6. | Reich, The New Property (p. 155)—Argues it would be good if a broader class of interests were treated w/the same rights and protections as property, including SS benefits, welfare, gov't jobs.
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E. | Marxist Theory and and bourgeois apologias for capitalism 172-184
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1. | "The fact that Marx's ideas haven't done well in the world tells you almost nothing immediately about the value of his critique."
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2. | Marx argues that a concentration of certain kinds of property (means of production) in the capitalist class deprives workers of the fruits of their labor, hence alienation. Sort of assumes you're familiar w/Locke's labor theory of property. Capitalist property destroys just relationship between labor and property so that property becomes a means of oppression.
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a. | Marx also respond to idealist Hegelians who claim property is about individuality and liberty. May have been true at one point, but not now under capitalism.
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b. | Also says that owners of means of production do not themselves labor. This is supposedly controversial. Their property is not a result of their labor, but a tool of oppression.
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a. | property need not function as means of oppression, but can function as tool of liberty.
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b. | "Some defensiveness in these responses."
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c. | Other liberal responses (e.g. Reichs and Demsetz) make point that whatever the flaws of private property system, it has considerable virtues. Riechs thinks private property can guard individuals against exercise of unjust power, but the problem w/property is that not everybody has some. This is why gov't entitlements should be vested w/the protections of property; then more people would enjoy benefits of private property system.
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4. | Shelley(D) V. Kraemer (P), 1948 (p. 179—
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a. | Ps Kraemer are property owners seeking to enforce an agreement excluding minorities from owning property on a certain street. Ds Shelley are African Americans who bought some property on the street from Fitzgerald. At time of sale, Shelley didn't know about the restrictive covenant.
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b. | Bottom line: Property rights can be oppressive or liberating. It all depends on how they're used.
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(1). | If you can oppress people privately w/your property rights (on your own land that's not open to the public), that's usually going to be allowed by the law.
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(2). | If you have to invoke state assistance to oppress people w/your property rights, that's not ok.
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c. | See also Prunyard (if you're trying to exclude people from a place that's otherwise open to the public, you're likely to lose) and State v. Shack (right to exclude is not absolute; property can't be used to secure control over people's lives)
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