NextGen UBE Real Property

Real property law deals with rights in land and buildings, both present and future. It explains ownership interests, landlord-tenant relationships, easements, covenants, mortgages, and the rules for transferring property. It also covers recording systems and priorities among competing claimants. The field shapes everything from ordinary home ownership to major commercial development.

I. OWNERSHIP OF REAL PROPERTY

A. Present Estates

1. Fee Simple Absolute (Fee Simple)*
A fee simple absolute is the most complete form of ownership, lasting indefinitely and fully transferable. Language like “to A and his heirs” creates this estate, and the owner has unrestricted rights to possess, use, and transfer the property.

2. Defeasible Fee
A defeasible fee is an estate that can be terminated upon the occurrence of a specified event. Fee simple determinable ends automatically when the condition occurs (“so long as”); fee simple subject to condition subsequent requires the grantor to act (“but if”); and fee simple subject to an executory interest shifts to a third party on condition breach.

3. Life Estate and Life Estate Pur Autre Vie
A life estate grants ownership for the duration of a person’s life, typically created with language like “to A for life.” A life estate pur autre vie lasts for the life of someone other than the tenant. Life tenants have rights to use the land but must avoid waste and maintain the property.

B. Future Interests

1. Reversion
A reversion is a future interest retained by the grantor when a lesser estate is conveyed, such as a life estate. The property automatically reverts to the grantor or heirs upon termination of the prior estate.

2. Remainder (Vested and Contingent)
A remainder is a future interest given to a third party that becomes possessory upon the natural expiration of the prior estate. Vested remainders are given to known persons without conditions; contingent remainders depend on a condition precedent or are held by unascertained parties.

3. Executory Interest
Executory interests are future interests that cut short a prior estate rather than waiting for it to end naturally. They are less favored due to their impact on marketability, but are transferable unless otherwise restricted.

4. Possibility of Reverter and Right of Entry
Associated with defeasible fees, a possibility of reverter automatically returns property to the grantor upon violation of a condition, while a right of entry requires action by the grantor to reclaim the property.

5. Rules Affecting Future Interests: Survivorship, Class Gifts, and Waste
Future interests are subject to conditions of survival or class closing rules (e.g., “to A’s children”), affecting the size and distribution of interests. Waste doctrines regulate life tenant actions that harm future interest holders.

C. Cotenancy

1. Joint Tenancy, Tenancy in Common, and Tenancy by the Entirety*
Joint tenancy requires four unities (time, title, interest, possession) and includes a right of survivorship. Tenancy in common has fewer requirements and no survivorship. Tenancy by the entirety exists only between spouses and protects against unilateral severance.

2. Partition*
Partition allows co-owners to divide or sell property when they no longer wish to hold it together. Courts prefer partition in kind (physical division), but may order sale if division is impractical or unfair.

3. Severance*
A joint tenancy can be severed by conveyance, mortgage (in some states), or other actions, converting it to a tenancy in common. Leases and judgments also raise severance issues depending on jurisdiction.

4. Relations Among Cotenants
Cotenants share rights to possess the whole, owe no rent unless ouster occurs, and must contribute to necessary expenses. A cotenant’s exclusive possession does not create liability without ouster.

D. Landlord-Tenant Law

1. Types of Tenancies*
Tenancy for years has a fixed end date; periodic tenancy renews automatically; tenancy at will lasts as long as both parties desire; and tenancy at sufferance arises from holdover tenants. Creation can be express or implied.

2. Possession, Rent, and Eviction*
Landlords must deliver possession; failure can lead to constructive eviction if premises become uninhabitable. Nonpayment of rent may lead to eviction or damages, and security deposits often require specific handling.

3. Assignment and Sublease*
Assignments transfer the entire remaining lease term, while subleases transfer less than the full term. Covenants against assignment or subletting are enforceable, but may be waived. Original tenant remains liable unless released.

4. Early Termination*
Early termination occurs through surrender, abandonment, or mutual agreement. Landlords typically must mitigate damages by attempting to re-let the premises.

5. Habitability and Suitability*
Modern law imposes an implied warranty of habitability, requiring landlords to maintain safe and sanitary conditions. Tenants may withhold rent for major breaches, subject to notice and state law.

E. Alienability, Descendibility, and Devisability
Property interests are generally transferable by sale, inheritance, or devise. Restraints on alienation are disfavored and must be reasonable. Future interests are also transferable, but may be subject to restrictions.

F. Fair Housing/Discrimination*
Federal laws and the Constitution prohibit discrimination in housing based on race, religion, disability, or other protected classes. Racially restrictive covenants are unenforceable, and landlords must provide reasonable accommodations for disabilities.

II. RIGHTS IN REAL PROPERTY

A. Easements and Licenses

1. Nature and Types*
Easements grant use rights over another’s land; easements appurtenant benefit adjacent land, while easements in gross benefit a person. Licenses are revocable permissions to use property.

2. Creation*
Easements can be created expressly, by implication (e.g., prior use), by necessity, by prescription, or by estoppel. Licenses arise informally and can become irrevocable in some cases.

3. Scope and Apportionment*
Easement use must conform to the purpose granted and cannot impose undue burden on the servient estate. The division of the dominant estate may trigger apportionment issues.

4. Transfer of Easements*
Appurtenant easements run with the land automatically, while easements in gross are transferable only if commercial in nature. Licenses generally do not transfer unless coupled with an interest.

5. Termination*
Easements may end by merger, release, abandonment, prescription, or expiration. Licenses are terminable at will unless estoppel applies.

B. Restrictive Covenants

1. Nature and Types*
Restrictive covenants impose obligations on land use; affirmative covenants require action, while negative covenants restrict actions. Equitable servitudes enforce land-based promises in equity.

2. Creation and Enforceability
A covenant must meet elements of intent, notice, touch and concern, and privity to run with the land. Servitudes require intent and notice but no privity, and may be implied in subdivisions.

3. Transfer
Covenants and servitudes generally transfer with the land if requirements are met, creating ongoing obligations for successors.

4. Termination*
These restrictions can terminate through agreement, release, estoppel, changed conditions, or prescription. Defenses include unclean hands and acquiescence.

III. REAL ESTATE SALES CONTRACTS

A. Creation and Construction

1. Statute of Frauds and Exceptions*
Contracts for land must be in writing signed by the party to be charged. Part performance or estoppel may remove the statute as a bar if certain elements are met.

2. Essential Terms*
The writing must include the parties, price, and property description. Ambiguities may be clarified with parol evidence.

3. Time for Performance*
Time is not ordinarily of the essence unless stated or implied by circumstances. Delays may impact specific performance or damages.

4. Remedies for Breach*
Specific performance is commonly available due to the unique nature of land. Damages may include out-of-pocket or benefit-of-the-bargain damages, and seller fraud may lead to rescission or tort remedies.

B. Marketability of Title*
Sellers must convey marketable title, free of reasonable risk of litigation. Defects like liens, encroachments, or unresolved claims may render title unmarketable. The obligation merges into the deed unless otherwise provided.

IV. MORTGAGES AND FORECLOSURE

A. Mortgages and Deeds of Trust

1. Definition
A mortgage is a security interest in land to secure a loan; a deed of trust involves a third-party trustee holding title as security. Both are subject to foreclosure if debt is unpaid.

2. Purchase Money
Purchase money mortgages arise when funds are used to buy the property and often have priority over other liens.

3. Future Advance
Loans allowing future advances are secured by the same mortgage lien if properly recorded and notice requirements are met.

B. Mortgage Theories*
Title theory states the lender holds title until payoff, while lien theory treats mortgages as liens only. Intermediate theory combines aspects of both.

C. Foreclosure

1. Judicial and Nonjudicial
Foreclosure can be pursued through court action or power-of-sale clauses. Defenses include procedural defects, loan servicing errors, or failure to provide notice.

2. Acceleration
An acceleration clause permits the lender to demand full payment upon default. It must be invoked per loan terms.

3. Parties to the Process
Mortgage priorities depend on recording, subordination, and modifications. Junior interests are eliminated unless they redeem or protect themselves.

4. Deficiency and Surplus
If foreclosure proceeds don’t cover the debt, lenders may seek a deficiency judgment; surplus goes to junior lienholders and the borrower.

5. Equitable and Statutory Redemption
Equitable redemption allows borrowers to pay off debt before foreclosure sale; statutory redemption allows redemption after the sale in some states.

V. TITLES

A. Adverse Possession
Adverse possession requires possession that is actual, open, notorious, exclusive, hostile, and continuous for the statutory period. Tacking may apply if privity exists between possessors.

B. Transfer by Deed

1. Requirements for Deed*
Deeds must comply with the statute of frauds, describe the property, and be signed by the grantor. Delivery and acceptance are required; parol evidence is used to clarify but not contradict terms.

2. Types of Deeds*
General warranty deeds offer the most protection with six covenants; special warranty deeds cover only the grantor’s acts; quitclaim deeds provide no warranties.

C. Recording Acts

1. Types of Recording Acts*
Notice statutes protect bona fide purchasers without notice; race statutes favor the first to record; race-notice statutes require both lack of notice and first recording.

2. Indexes
Title searches rely on grantor-grantee or tract indexes. Mistakes in indexing or acknowledgement may affect record notice.

3. Chain of Title
A proper chain of title is established by linking successive ownership records. Breaks in the chain affect marketability.

4. Forged Deeds
Forged deeds are void and pass no title, even to bona fide purchasers, unlike deeds obtained by fraud, which are voidable.