Dolin Property Spring 2015 Outline - RLA

Purpose of the class:

1. Understand function and policy reasons for creating and protecting property rights.
a. Why do we have laws on this subject?
b. What social values are at work?
c. Do the laws adequately reflect the values of our society?
2. Understand the rules the various types of property and how they are used in society.

Basics
a. What is property a social contract, a signal to mark boundary of, a way to define
social relations, helps with economic efficiency, a measure of wealth. It is the way
we define our relationship to the outside world. Its our relationship to things.
Landlord/Renter they each have a relationship to the apartment and they are
different. Its a way for people to signal to others in the world our interests.
b. The purpose of property rights is to enhance social welfare by maximizing the
value of scarce resources.
c. Title; Concept of title goes to rightful possession, possession is 9/10 of the law,
must have a moral and legal claim/right to the property. The notion that being
there first somehow justifies ownership rights. First in Time is First in Right. If
you are in possession of a good you are presumed to be the owner of said good.
d. Property does not evolve well because property is a long term interest; property
rules change little and contain a mix of various rules. Ownership changes could
impact society suddenly you dont own your home, etc.
e. If you own something, you can exclude someone from owning the thing you own.
f. Values we keep in mind when considering property:
i. Personhood
ii. Political Liberty
iii. Economic Efficiency
g. Why Have Property?
i. Communal ownership - everyone will seek to maximize his rights to the
property by over hunting or over tilling the land because the costs of doing
this is borne by others. Externality Someone gets all the benefits and the
loss is born by all owners of the common property.
ii. Private ownership - the owner will take into account the chance to
maximize the value of the land for the future.
iii. The Utilitarian theory of property the primary function of property rights
is to promote the efficient use of resources.
iv. Property defines who we are and defines a relationship.
v. Tragedy of the commons - When you dont own things you abuse them
EX. a rental car. when no one has any interest in the resource people
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may take too much or dont treat it with respect. (example = overfishing)
(Rhinoceros farm hypo)
vi. Tragedy of the anticommons where there is too much private ownership.
h. Property Rights as a Bundle of Sticks
i. These rights include:
1. Right to Possess
2. Right to Use
3. Right to Exclude
4. Right to Transfer
i. Positive/Negative Externalities These exist whenever some person, say X,
makes a decision about how to use resources without taking full account of the
effects of the decision. X ignores some of the effects some of the costs or
benefits that would result from a particular activity, for example because they
fall on others. They are external to X. As a consequence of externalities,
resources tend to be misused or misallocated, to societys detriment sometimes.
j. John Lockes Labor Theory of Property: When a person takes an apple from the
commons he appropriates a property right in the apple because he has mixed his
labor (which he owns) with the previously unowned apple and thereby made the
apple his own.

Property Acquisition
1. Conquest
a. John v. MIntosh (1823)
i. Two people cannot claim the right to the same piece
of the land.
ii. Why does First Time matter? Kinda like a marker
I was here first! it promotes
competition/investment
iii. Cannot give or sell more than what you have
(Indians did not have the right to sell the land, only
rent it)
iv. The line of title, traced from the US, to Britain, to
Spain and to a point where no one owned it. Gotta
trace it back to find the ownership.
v. Basically the Indians abandoned their right of
occupancy and the US owner could take that right
away.
vi. Conquest is no longer recognized under the law.

First in time, First in Right

1. First in time, first in right creates Peace and certainty benefit
of first come first taker, encourages development of the land and

easy administration. Had this rule for a long time. What does it
mean to be first? When courts talk about possession that is usually
a conclusion, not a beginning.
b. Downside may led to inefficiency, and antienvironmental. Arbitrary rule but not anymore arbitrary
than other rules of property. Does rely on power, the
powerful are more likely to get to the land first.
c. Pierson v. Post (1805)
i. Posts mere pursuit gave him no legal right to the
fox. If Post had used traps to capture the fox, or
wounded the fox, he would have possession of the
fox and a legal claim to it. Must render the animal
unable to escape that would equal possession.
ii. Mortally wounding = manifesting intent. You must
do something to get it into your possession.
iii. Society benefits from hunters of noxious beasts
we want to reward those that began the hunt.
iv. We want administrative ease promotes peace,
certainty and fairness.
v. Hunters and participants have their own settled
expectations so custom is important. Customs
play a big part in this
d. Popov v. Hayashi
i. Issue: If an actor undertakes a significant but
incomplete steps to achieve possession of
abandoned personal property and the effort is
interrupted by the unlawful acts of others, does the
actor have a legal pre-possessory interest in the
property? YES!
ii. Conversion is the wrongful exercise of dominion
over the personal property of another. There must
be actual interference with the plaintiffs dominion.
Wrongful withholding of property can constitute
actual interference even where the Defendant
lawfully acquired the property.
iii. MLB intentionally abandoned the baseball. The first
person to come into possession of the baseball
became its new owner.
iv. In this case, each man had a claim of equal dignity
in the baseball an equal undivided interest. The
ball was sold and the proceeds divided equally
between the two parties. Popov should not have

been attacked and Hayachi wasnt a wrongdoer

this is why they each have equal right to the ball.
v. Remember possession is a legal conclusion. We
have to look at what is practical when applying the
rules. Property isnt about things but our
relationship to things and the world.
vi. If you find lost property, you have a better interest
than everyone else but the true owner has a better
interest than you.
HYPO: Valet doesnt give you your car back because he doesnt think you are really you. Valet
is exercising wrongful dominion over your property.
HYPO: A big pool of oil property line between A and B. A has 10% of land and starts pumping
oil; so question is: How much oil can A draw? He can draw all of it. Under what theory? First
Possession. Hes the first to draw it out of the ground so hes in possession.
HYPO: Can A go on Bs property to get some oil? Not without trespassing.
Problems Page 22
#2: Suppose that T, a trespasser, captures a wild animal on the land of O, a landowner, and
carries it off to her own land where she confines it in a cage. Subsequently, T1 trespasses on Ts
land and takes away the animal. In a suite by T against T1 for return of the animal, T1 defends on
the ground that T had no right of ownership to the animal. How would you respond?
Answer: T should win their claim is better than T1. O would also win. While the wild animal is
on your property the wild animal is yours. This helps prevent people from trespassing on your
land. O had constructive possession of the wild animal higher hierarchy.
#3: F has established a herd of deer that she keeps for pleasure and an occasional roast of
venison. The deer roam about on open government grazing land during the day but are
sufficiently tame and domesticated that they return to a large shelter on Fs land in the evening.
H, a hunter, licensed to hunt deer on the land, shoots one of Fs deer one day during the hunting
season. F sues H for return of the carcass. Who prevails? Answer: F wins, due to the fact that the
deer are domesticated. The hunter cant tell this tho F has a better claim than H.

Property owners right to exclude

a. Jacque v. Steenberg Homes, Inc. (1997) The Jacques had a right to deny
Steenberg access to their land, that is a fundamental property right. The right to
exclude is more important than economic efficiency.

b. The right to property if nothing else is the right to exclude others. For any
reason
c. Society also has a strong interest in protecting private property from
intentional trespass. This is so to preserve the integrity of the legal system.
d. We have rights in private property (The Bundle of sticks) and the Right to
Exclude is the central stick in our bundle.
e. Right to Exclude is not absolute
i. State v. Shack (1971) The migrants are a disadvantaged segment of
society, their right to see a visitors by their own choice cannot be denied.
The two were acquitted of trespassing charges.
ii. Property rights serve human values.
iii. The Right to Exclude does not include barring people from government
services. The Right is fundamental but not absolute.
iv. Cannot give complete dominion over people that the owner lets to enter
the property.
f. Result oriented judging is bad. The courts want a general rule that can be applied
to everyone.
g. Property rights must be decided to benefit society the most. Courts still weigh
economic efficiency for all of society, private property is more economic efficient
as a whole.
HYPO: Treat the migrant workers as renters sharing a common hallway.

Fugitive resources
1. Oil and gas are looked at the same way as wild animals; whoever
captures it owns the resources.
2. Oil a field split between two properties, the seconds propertys
only recourse to pump the oil faster than his neighbor. But the oil
will be used up quicker.
3. More common today - Courts have ordered that the pumper will
have to share a percentage of the oil other with the other neighbors,
so it does not matter how much oil he pumps the neighbor still gets
a cut, better use of resources.
4. Water whoever captures the water first owns it, unless they
actually harm their neighbors.

Property in Ones Person

1. Property rights can be acquired by discovery, by capture and by creation (you create that
color, cells, or bacteria)

2. Usually in all those instances we award the rights to the person being First in Time.
However, what it means to be First is highly situational and we look to things like
control, administrating the rule and things that are instrumental
3. When courts talk about being in possession that is usually a legal conclusion rather
than a predicate. You can hold onto something without being in possession of it, for
example. Courts can conclude this depending on the instrumental means Courts are
looking at the ultimate goals that we are trying to serve they like the overall result than
the individual result. Example Moore case the science rights were seen as more
important than Moores personal rights.
4. Property rights are thought of as a bundle of rights including the rights to exclude (most
important), the right to include, right to sell or transfer or gift, right to use, etc.
(Examples) Public policy = not all sticks are present in every bundle. But at the same
time, a mere absence of some sticks does not mean an absence of ownership rights (cant
destroy cat but you still own it).
5. Property rights especially the right to exclude are often on a collision course with
other peoples rights. Its the most important right but we often come to a point of
whether or not we are going to honor it. We then look at the overarching goal here.
Example you can sell your blood but not your kidney. You can get a patent on bacteria
but perhaps not on DNA, etc.
i. Moore v. Regents of the University of California (1990) Cell line case
1. The court cites a Federal law that states that body parts cannot be
sold. Property is not the thing but a bundle of rights. Since you
cant sell tissue, it is no longer property. Medical research was
more beneficial to society than Moores right to his cells, which
would have been thrown away anyway.
2. No expectation to ownership the cells/body parts are typically
disposed. You dont expect to retain your spleen for example.
Also, his cells arent unique to him (different from the persona
argument). The cell line is patented and legally distinct from
Moore by virtue of the patent itself. Bottom line: Once tissues
come out of our body basically you dont own them.
3. Does a claim for conversion lie for the use of a plaintiffs bodily
tissue in medical research without his knowledge or consent? No.
A claim for conversion does not lie for the use of a plaintiffs
bodily tissue in medical research without his knowledge or
consent.
4. Under the duty to obtain informed consent, must a doctor disclose
his intent in using a patient for research and economic gain? Yes.
Under the duty to obtain informed consent, a doctor must disclose
his intent in using a patient for research and economic gain.
5. To establish conversion, plaintiff must establish an actual
interference with his ownership or right of possession. Where
plaintiff neither has title to the property alleged to have been
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6.

7.

8.

9.

converted, nor possession thereof, he cannot maintain an action for

conversion.
The court held that since the plaintiff did not expect to retain
possession of his cells, to sue for their conversion he must have
retained an ownership interest in them. There are several reasons to
doubt that he retained such interest. First, there is no precedent in
support of plaintiffs claim. Second, California statutes drastically
limit any continuing interest of a patient in excised cells by
requiring that they be destroyed after use. Third, the subject matter
of the patent (i.e. the patented cell line and the technology and
products derived from it) cannot be Moores property.
Moores allegations state a cause of action for invading a legally
protected interest of his patient. A cause of action can lie under the
informed consent doctrine as a breach of the fiduciary duty to
disclose material facts, or the lack of informed consent in obtaining
consent to conduct medical procedures. A reasonable patient would
want to know that his physicians professional judgment might be
impaired by an independent economic interest.
Mosks dissent Majority is hung up too much on just because you
cant sell your spleen its not property. Its simply not true that
body organs simply cannot be sold. We allow the sale of blood,
sperms, eggs, etc. By prohibiting sale of body parts you impact
the supply/demand of kidneys. How does that impact society? This
is in every other argument cause and effect conflicts of policies
and values.
Public Policy: The court stated that it must balance the competing
interests in determining whether conversion liability should be
extended. Extension of conversion liability would produce great
harm to future medical research. The court held that this was an
issue better left to the legislative branch.

Patents/Trademarks
Patent Application must meet fire requirements in order for the patent to be granted:

1. Patentability this means that the invention fits in one of the general categories of patentable
subject matter. Patentable inventions are limited to these four, process, machine, manufacture,
or any composition of matter. This has been extended to include genetic materials like DNA
sequences, proteins, and business methods. Laws of nature and abstract ideas are not patentable.
2. Novelty this means that it has not been preceded in identical form in public prior art.
3. Utility this is a minimal requirement that is easily met so long as the invention offers some
actual benefit to humans.
4. Non-obviousness this is the most important requirement; it asks whether the invention is a
sufficiently big technical advance over the prior art.
5. Enablement this requires the patent application to describe the invention in sufficient detail
so that one of ordinary skill in the art would be able to use the invention.
Class Review of Diamond v. Chakrabarty Case
Progress in science is furthered by providing incentives to people/scientists. By doing this, more
people will toil in their labs and society is rewarded. To do this, we can provide them with
property rights, etc.
Case reviews what kind of life can we own? Should we be able to clone sheep? An entire breed
of animal? Or go down the chain strings of DNA.
Remember the policies underlying property law and there are two sides to the argument why
we should be able to sell kidneys and why we shouldnt. At the end of the day we must
examine our instrumental ends what are we trying to accomplish here?
Qualitex Co. v. Jacobson Products Co Case
Can you trademark a color? Of course! There is no rule absolutely barring the use of color alone.
Trademark lasts as long as you use it no expiration date - could be forever. Patent is only for 20
years.
Look at the context of the case. Qualitex owns the color for drycleaning pads not in general. In
the abstract could sound ridiculous.

The Laws of Finders

II.

Subsequent Possession: Acquisition of Property by Find, Adverse

Possession, and Gift.
a. Acquisition by Find
i. Armory v. Delamire (1722) Chimney sweeper case
1. The chimney sweep is almost the true owner because he has
possession.
2. A finder of a chattel does not acquire an absolute property right,
however he does have title superior to everyone except the rightful
owner.
3. Court agrees Armory is not the owner; but he maintains a property
right against everybody else (including Delamire) except the true
owner. You dont need to show against the whole world just that
you have better property rights against the other guy.
4. What rights does a finder of property have in the property found?
Holding and Rule: A finder of a chattel does not acquire an
absolute property right, however he does have title superior to
everyone except the rightful owner. Regarding damages, the court
held that when damages are at some unascertainable amount below
an upper limit and when the uncertainty arises from the defendants
wrong, the upper limit will be taken as the proper amount. The
court held that D was liable for the highest possible value of the
stones unless he produced them for the court. D was also liable for
the acts of his apprentice in removing the stones.
5. Possession is most of the time the only way to prove that you own
the property. Title is relative first finder has a better claim than
the second finder and so on.

HYPO: Armory stole the ring. He says he found it but he really stole it. D keeps it. Same
outcome or different? Yes, same. Theres no difference. Policy values is it good to steal from
thieves? Better outcome which thief should win first thief or second thief? First in line
maybe? Because it promotes less violence. Yes, first thief should win even though it promotes
thievery it also promotes peace.
HYPO: Delamire pays Armory for the ring. True owner comes into Delamires shop, sees his
ring, shows evidence and he wants it from Delamire. D tells true owner to get from Armory
since he already paid for the ring once. Who wins? True owner should.
HYPO: What if Armory comes in, seals from true owner, court orders him to pay; then real
owner shoes up and wants the item. Result?

This case stands for your rights are relative to other people and to the actual item other issues
arise, rewarding thievery and what happens when someone pays the value and the true owner
shows up for the item, too.
HYPO: If you buy stolen goods (even if you dont know they are stolen) and the true owner
shows up, they have a better ownership right compared to you.

Lost Property
6. Hannah v. Peel (1945) (Kings Bench) (p. 101)
a. The court wants to reward the honest person. Peel never
had possession of the broach. Key to the case was the item
was on top the property, not buried in the land.
b. The finder of lost property has superior title against the
owner of the land on which it was found.
c. While a man possesses everything attached to or under his
land, he does not necessarily possess a thing lying
unattached on the surface. There is no doubt that the brooch
was lost property. Peel had neither prior possession of the
brooch nor possession of the premises in which it was
found at any time.
d. The key issues in the analysis are possession (not
ownership) of the land, status and knowledge and the
circumstances of the discovery. Peel owned the real estate
but was never in possession of it.
e. Lost property you didnt intend to drop the wallet on the
floor and it inadvertently slipped out of your pocket. The
finder wins except against the true owner. This is because
the true owner is unlikely to retrace their steps and it also
rewards the finder for their honesty.
7. Possession is either you possess the item or you dont possession.
All or nothing system, the case could come out either way.
8. Ship Wreck English Law ship wrecks were property of the King.
In the US, if the ship settled on the bottom it remains the owner
property until title is abandoned.
9. Finder has better claim, than the true owner or a previous
finder.
10. An item is said to be lost when the owner inadvertently loses
possession of it. Lost property usually goes to the finder because
the true owner, who does not know the items whereabouts, is
unlikely to retrace his steps and find it. This also rewards the
finders honesty.

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Mislaid
11. McAvoy v. Medina (1866) (p. 107)
a. Mislaid - the court wants to give the item to the person who
would most likely return the property to its rightful owner.
The store owner was that person.
b. Lost vs. Mislaid forgotten property vs. lost property,
mislaid might encourage people to never turn in property
found, just keep it.
c. Lost vs. Mislaid is very fact based, is based on the facts
of the given case.
d. Mislaid property if you intentionally placed it somewhere
(with the full intention to pick it back up) and when you
were leaving you forgot to pick it up. If mislaid, the locus
in quo wins. The rationale is that this helps the true owner
to find their mislaid item since they can re-trace their
steps. This is our ultimate goal to restore the mislaid
property back to its true owner.
12. Finder has better claim, than the true owner or a previous
finder.
13. An item is said to be mislaid if the owner intentionally placed it
in some location and then forgot to retrieve it. If mislaid, the
true owner wins the rationale is that this result aids return of
the item to the true owner, who will usually retrace his steps to
where he last left the item.
14. Abandoned property is when the owner intentionally relinquishes
all legal rights to it with no intention to confer rights on any
particular person. Abandonment occurs all the time such as
tossing item in trash. When a person finds abandoned property
ownership goes to the finder.

Acquisition by Adverse Possession

Summary of Adverse Possession Law
1. Title to property can be acquired by one who doesnt actually own the property through
the doctrine of adverse possession. This doctrine allows possessor to oust the true owner
if certain requirements are met.
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2. In order to acquire land or chattels by adverse possession, one must satisfy the following
requirements: a) there must be an entry; possession must be open and notorious; it must
be continuous; it must be under the claim of title; it must be adverse to the true owner;
and it must be for a requisite period (different for each state).
3. Hostility or adversity does not mean hatred or enmity for the true owner; instead, all it
means is that your legal claim to this land or chattel is incompatible with the true owners
claim to the same land or chattel. The true owners superior title makes your occupancy
not hostile.
4. Continuous need not be constant; you can go out for milk or even take vacations. Instead,
all that is required is that you use the property as the true owner would. Summer
cottage/winter cabin used in those seasons. Exclusivity is part of this you need to have
this.
5. In order to satisfy the statute of limitations, subsequent possessor may tack or add their
time to that of the preceding possessors, provided that they are in privity with each other.
6. Chattels may also be adversely possessed but what counts as open and notorious may
simply be a more difficult question. There are different rules but the New Jersey
Discovery Rule is the dominant rule.
7. Legal disabilities on the part of the true owner toll the statute of limitations/stop the
clock. Again, provided that the disability existed at the time the cause of action accrued.
At the time the true owner couldve gone to court to expel the interloper. This rule means
that disabilities cannot be tacked to one another. You only get one. If you are disabled for
more than one reason, you can pick whichever one is longer as long as they both
existed at the time the cause of action accrued.
The Rules of Adverse Possession (he didnt go into exclusivity at first)
1. There must be a physical entry. Not good enough to just do a check mark you must
have entry. This serves a function of notice because without this, how can a true owner
enforce his rights?
2. Entry must be open and notorious. You cant sneak on the lawn every night for 20 years
and then say its yours. (also about notice).
3. Must be continuous. You must live there for the requisite period of time (depending on
State) continuously. You dont have to live there constantly you can leave to get bread,
etc.
4. Must be under the claim of title (claim of right). You must have a claim that you have a
right to be there. You dont need a piece of paper (thats called color of title) but you must
claim that you are doing it under some right.
5. Must be adverse to the true owner (this is the weird part). The two parties dont hate each
other but the adverse party doesnt have the true owners permission. If on the last day
before adverse possession would be had and the true owner says You know, you have
my permission to stay here then you would lose your adverse possession. The two
claims are incompatible with each other, basically.
6. Must be exclusive you treat the land as a true owner would/does. Basically you cant be
sharing with the true owner/public.
i. The Theory and Elements of Adverse Possession

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ii. A statue of limitations in which a land owner can no longer bring action
for recovery of land.
iii. The rule is the opposite of first in time. But without the rule, then 20
years down the line, the true owner of the property could kick the
possessor off the land, without any compensation. The true owner had no
economic benefit from the land, while the possessor did.
iv. Promotes efficient land use to use for building, agriculture something
productive. You dont want to promote fallow/abandoned land. (focuses on
the adverse possession owner)
v. Requirements
1. Actual
a. SOL starts to run with an entry, must be an entry. Unless
you enter the true owner does not know his property is
violated.
b. Statute of limitations waits until the true owner knows of
the encroachment or a reasonable owner would notice it.
Thus, you wont start counting the years/statute of
limitations until this standard is met.
2. Exclusive Possession
a. Adverse claimants possession and use cannot be shared
with the true owner or with the public in general
3. Notorious and Open
a. Entry must be open notorious, and visible, so the owner
can sue you for trespass.
4. Hostile and Under Claim of Right (Adverse) (Most confusing
Element)
a. To the true owner, not by permission (license) of true
owner. Hostile means your claim of title is incompatible
with the true owner. If you sell the land your possessing the
true owner cant sell the land as well.
b. Approach inquiry from the terms of the state of mind of the
adverse possessor.
c. Doctrine reflects three different views on this: i. Objective
Standard - State of Mind is Irrelevant (Majority View):
Conduct of adverse possessor is all that matters; if the
adverse possessor occupied and used the law in the way
that one would expect of the true owner of the land then
that evidence is sufficient to establish adversity; ii. Good
Faith Standard I thought I owned It requires a goodfaith claim; Aggressive Trespass Standard I thought I
didnt own it but I intended to make it mind.
d. Hollander v. World Mission Church Case

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i. Church says there is no hostility here one of the

requirements for adverse possession. Supreme
Court of VA agrees that the requirement is
necessary. Occupying land under a mistake is not
enough. Reasoning behind this logic is if all you
are seeking to occupy is your land, that kind of
means that you are always willing to go back to
your own boundary you arent willing to take
anyone elses land. If thats true then you have no
claim thats hostile to the claim against the true
owner.
ii. Hollander based his claim not only on the deed
descriptions, but also on their belief that their
property line ran to the lien of woods. Thus,
Hollanders possession was accompanied by the
requisite adverse of hostile intent.
iii. This also goes back to minor/invisible
encroachments. Until the true owner is on
notice/should be on notice, the statute/clock is not
ticking. How is this resolved? What remedies are
provided? Sometimes tearing down an entire
structure might be unfair. Thus, courts have
struggled with well, do we need good faith?
5. Continuous and Uninterrupted
a. Must be continuous, but does not need to be constant. As in
Howard if there is privity between occupiers, it is
continuous.
b. Are you treating your land in a manner that a true owner
would? That is the definition of continuous. Courts will
allow a tacking of time but only under privity.
vi. If all of these conditions are met, then the SOL on ejectment has run and
the land is yours. Some states require paying of property taxes. Adverse
Possessor will file for quiet of title.
vii. Policy of AP
1. Encourage Economic development
2. Correct title defects
3. Prevent frivolous claims
4. Sleeping theory - Society does not want the owners to sleep on
their rights.
5. Earning theory - You improved the land you should be entitled to
it. Lockes fruit of labor theory.
viii. Three common ways to obtain property through adverse possession

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1. Mistaken belief
2. Encroaching on neighbors property
3. Purposefully attempting to take the land as yours
ix. Van Valkenburgh v. Lutz (1952) (p. 122) case where the court failed to
understand adverse possession.
1. Fulkerson v. Van Buren - FACTS: VB claimed AP b/c he took and
improved church on F's lot. HOLDING: No AP b/c church lacked
requisite intent since during occupation they recognized the
ownership right of titleholder (asked for quit-claim deed). Also,
VB not clear as to intent. Court implied that church congregation
claiming title did not meet hostility requirement, in part, because it
"was unsure of the precise nature of its interest in the land."
a. Claimant must have exclusive control what does this
mean and why is it important? Because its like they are
acting like they are the true owner they can exclude other
people, and take other actions as if they own the property.
They must treat the land as a true owner would have.
b. Court says: Hostile means its the intent to hold against the
true owner. Hostile doesnt mean dislike or ill will.
Hostility in adverse possession it means that you have a
claim of right that is incompatible with the true owners
claim of right. We dont reward squatters. You actually
think that the land is yours and your claim of right is
hostile against the true owners claim of right. Mere
possession without more is not enough to show adverse
possession. Mere possession without more does not mature
into ownership.
c. Look at the different values/underlying policies. The
building afterwards deteriorated and remains unoccupied.
Plus, the hard work of Van Buren improved the area and
society. So the values of the occupant and the owner clash
here. So should we be concerned about reward or
punishment. Should we reward Van Buren since they put
blood, sweat and tears into the land? Should we punish
Fulkerson for sleeping on his rights?
x. Some American courts do not allow a squatter or trespasser to ever
get adverse possession.
1. The courts required either one of three states of mind for adverse
possession:
a. State of mind is irrelevant (objective standard)
b. I thought I owned it (the good-faith standard)

15

c. I didnt own it but I intended to make it mine (the

aggressive trespass standard).
xi. Color of Title when the claim is based on a written instrument that is
defective and invalid, either the wrong deed or the seller never really
owned the land. Still must enter the land, but only a small part of it,
constructive possession. In a few states it is required for AP, but most
states do not require it.
1. Color of Title means you actually have a document that purports to
have title but it is actually defective, because the person didnt
actually have title. This is isnt procured by fraud; you think its
authentic but you were told wrong. The law will treat Color of
Title better than Claim. Because under claim, you are making your
own decisions.
2. Under Color or Claim of Title, possession must be exclusive. You
must treat whatever land you are on (physically or constructively)
as the true owner.
xii. Howard v. Kunto (1970) (p. 142) - The purchasing of the deed creates
privity between the buyer and seller; there is a strong public policy reason
for this. All parties acted honorably, it is not reasonable or customary to
use a surveyor to inspect the land when buying in the area, but the parties
in this case did.
1. Is tacking of possession by subsequent occupants permitted if the
land is occupied under a mistake of fact? Yes. Tacking of
possession by subsequent occupants is permitted if the land is
occupied under a mistake of fact provided the occupants are in
privity.
2. May a party prevail on a claim of adverse possession if physical
use of the property was limited to summer occupancy? Yes. A party
may prevail on a claim of adverse possession if physical use of the
property was limited to summer occupancy.
3. A purchaser of land may tack the adverse use of his predecessor in
interest when the land was intended to be included in the deed
between them but was mistakenly omitted from the description.
The requirement of privity is merely judicial recognition of the
need for some reasonable connection between successive
occupants of real property so as to raise their claim of right above
the status of a wrongdoer or trespasser.
xiii. Disabilities
1. If the real land owner has a disability, the SOL is extended if the
person recovers from his disability. The disability must exist before
the entry. If the disability happens after entry it does not count.
Disabilities cant be tacked or added together, only allowed one
16

disability. Minority, lack of mental capacity, and imprisonment (not

in MD).
2. A disability is immaterial unless it existed at the time when the
cause of action accrued.
3. While you are a minor, or insane, or in prison the statute of
limitations doesnt start running during those periods. But two
conditions must be met the disability must exist at the time the
cause of action had accrued (the time that you could have in theory
brought against the adverse possessor); If the disability began after
someone entered your land, then the exception doesnt work you
had a chance to evict them; the second condition is that the
disabilities cannot be tacked to each other; thus, if you were a
minor at the beginning, but then became insane the disability
would end once you werent a minor. If you were both at the same
time in the beginning, they would choose the one that is longest.
You cant combine the disabilities together.
4. So why not just appoint Guardians for minors? Hard to answer
might just be cheaper to give them the grace period and theyll
figure it out when they grow up the have that extension after they
reach the age of majority.
xiv. Adverse Possession Against the Government
1. Under common law AP does not run against the government.
English maxim no time runs against the king. Some states either
by Judge-made law or legislature allow AP, by either the same
terms are private land or longer terms.
xv. Adverse Possession of Chattels
1. OKeeffe v. Snyder (1980) (p. 151)
a. Although the SOL had run on OKeeffes claim, under the
discovery rule, the SOL does not run until the plaintiff has
discovered the facts that led to the action. Must first
discover who had the paintings first, so she can sue them.
Actual knowledge is required before the SOL starts to run.
b. SOL for stolen goods is necessary because it would hurt
commerce if a good could be claimed as stolen at any time.
c. Big difference between personal property vs. real property
personal property is easily concealed
d. Thief doesnt acquire title; you cannot sell that which you
do not have; but the purchaser can adverse possess the
personal property. Question is when does the clock start
running? It doesnt start anew upon each transfer tacking
is still permitted in New Jersey. If transfers are done to
keep hiding bad faith/theft, then it doesnt tack.

17

e. Remember thief has nothing to sell so the buyer has no

legal right to buy from the thief. A thief can never own
anything through adverse possession the clock never
starts/runs for a thief. Purchase is important as it starts the
clock on adverse possession. The purchase allows for the
buyer to start running the clock.
f. Court: When the injured party should in exercise of
reasonable care, have known for the cause of action. This
requirement of knowledge also includes the identity of the
possessor either actual or constructive. If you undertake
trying to find your goods, the clock never starts and
people cannot own against you via adverse possession. If
you dont take reasonable efforts than the clock starts.
Reasonable depends on the context of what was stolen from
you/lost. After all, we do care about people sleeping on
their rights. This is called the Discovery Rule.
g. Synopsis of Rule of Law. The statute of limitations for
replevin will begin when the owner of the chattel should
have through due diligence discovered facts that form the
basis for a cause of action.
HYPO: Homeless people fix up an abandoned house in Baltimore. Is this a bad thing? No good
answer reflects the balancing.
HYPO: Crazy lady protesting does she own the land her tent is on? Ignore the Federal Govt
statutes that probably protect her from doing this. Look at common law instead. But shes not
adverse to the true owner since its public land. Shes there by permission to protest there. She
also doesnt occupy under the Claim of Right.
HYPO: Someone is leasing an apartment for 50 years. He says, the apartment is mine and
everyone knows that I am in possession. Court would say, thats fine, you are in possession but
the true owner can rebut by showing the lease. Court will presume that if someone is occupying
land, it will be presumed that you are in this land under claim of right, absent to the contrary.
Open and Notorious Requirement HYPO: Somebody encroaches on your land by a few inches
and you discover that 20 years later. Neighbor only finds out when he does a survey. Lets apply
to the rules:
1. There is an entry;
2. It was continuous (20 years);
3. It is incompatible with the owners rights;
4. This isnt open and notorious though.

18

The problem with a half-a step is its not really open and notorious because the human
mind may not be able to foresee the half step issue. Thus, is this enough to put the owner truly on
notice and to meet this requirement? How are you supposed to know survey your land every
year? (crazy expensive).
HYPO Underground Entry: What do you do if someone enters your land by going
underground into the cave that goes under your land?
Two plots of land and there is a cave underneath them. Owner of Plot A starts exploring the cave
past his property line so under As land and under Bs land. After 20 years, A seeks to quiet title
to the underground portion of Bs land.
Answer: Maybe its enough to know about the cave entrance. But B wasnt really put on notice
this doesnt mean the open and notorious requirement of adverse possession. Remember, B owns
the property, all the way down to the center of the earth. A is invading Bs property hes
treating it like a true owner (Charging money for tours) but B hasnt been put on notice. What
would a reasonable owner know? Technically, B has no right to demand A to allow entry. A is not
obliged to give B permission to enter the cave, either.
Privity HYPO (this was on an old exam): What if you like spending winters in your summer
cottage so you dont realize if someone is staying in your summer cottage?
Answer: Analyze just like Howard v. Kunto but there is an issue as to the timing it comes up
to once you move away from constantly other problems arise.
Once we move away from hard and fast rules you realize what values are important.
Often not about the mirror application of rules but looking at the core values/instrumental goals
that we are serving here

Review of Problem 1 Page 123 (HYPOS)

O should win because its not in exclusive possession. One of the important requirements of
adverse possession.
A would win if he only tried to quiet title for the 40 acres. A meets all of the requirements for that
portion of land.
A would also win if O had not been at the farm then A would have exclusive possession of the
entire 100 acres.
What if O tried to evict A from the 40 acres, who should win?
A should win he satisfies all of the required factors.
Review of Problem 2 Page 123
A v. X = A would win because A was in possession and had color of title.
A v. Y = Y would win because there was no entry to effectuate adverse possession. A thinks both
lots are together (contiguous) but you have to look at it through the lens of a true owner.
19

If this was a single piece of land, owned jointly by X and Y, then A could win due to his color of
title and his physical possession.
Would it matter if A has a valid deed for lot 1 from X and an invalid Deed to lot 2 from X. Who
wins? Y would still win he has no way of knowing that A thinks he owns both.
Always ask yourself would the true owner have a case to bring against the adverse possessor?
Would they know about it, etc? If yes, then the statute was running.
Disability Problems Page 133
1.(a). Disability ends upon Os death in 2007. H has 10 years to enforce through 2017.
1.(b). Disability ends upon Os death in 2007. Cant tack disabilities (insanity and minor of O) so
PR can bring claim through 2017 (on Os behalf since hes a minor)
2. O was under no disability so the statute of limitations doesnt stop until it ends which
would be 2005 (21 years per statute).
3. Can do either whichever is longer. Answer is 2007. Not because its 18 + 10. You have to
make sure the total 21 years has run. Count from 21 years from the date someone occupies your
land and 10 years from when the disability ended. The disability has to have existed at the time
the cause of action was accrued (when he couldve gone to court to evict the interloper) so
here, the insanity disability doesnt matter.
4. The advice you would give to B is whether O labored under any disability? A can still be
ousted depending on that you really want to find out what the heck happened to O.
Reviewing Problem #3 again:
You have to look at both periods you must pick the longer of the two or the end of your
disability plus whatever the state gives you. You have to look at both. The statute only runs until
the later of the two expires.
1997 = O is age of majority plus the 10 years allowed under the Disability Rule. 2007 is after
2005 so thats when it expires.
So how is this fair? We deal with this by appointing Guardians through the
State/Family/Trustee to protect the legal rights of those vulnerable in society.

Acquisition by Gift
i. Property can be transferred by gift but formalities must be satisfied.
Those formalities are intent to give the gift; delivery of the gift; and
acceptance of the gift. Delivery must be as actual as practicable; with the
extent that you can hand over the property you must; otherwise there
was no gift.
ii. Two types of gifts:
1. Gifts given during your lifetime (Inter-Vivos);

20

2. Gifts given post-demise (Causa Mortis). Usually done through a

Will, which is witnessed. These are generally disfavored due to lots
of fraud.
3. What does the law prefer? Inter-Vivos helps to prevent fraud.
iii. The donor must transfer possession to the donee with the intention to
make a gift to the donee. There must be:
iv.
4. intention
5. delivery
a. actual, constructive delivery (a key to a deposit box),
symbolic.
b. If property can be handed over, it must be.
6. acceptance (rarely an issue).
v. Newman v. Bost (1898) (p. 167)
7. Newman claims the items were all gifts under donation cuasa
mortis (a gift upon ones death).
8. Donatio causa mortis requires: 1. An intention to make the gift and
2. A delivery of the thing given. The matter of delivery is not
defined by the courts; some say symbolic is sufficient or
constructive delivery.
9. Causa Mortis is a substitute for a will. If the item is already in the
donee possession, the item must be re-given. Traditional if the
person does not die, then the gift is revoked.
10. As society we respect the wishes of the dead, whether in a will or
causa mortis.
11. Synopsis of Rule of Law. To constitute a gift causa mortis, a gift
made in contemplation of and expectation of immediate death,
there must be an intention to make a gift and actual delivery of that
gift. The donor of the gift can expressly or impliedly intend to
make a gift, but it must be clear that the donor knew what he was
doing and that he intended to make a gift. Actual manual delivery
must occur when articles are present and capable of manual
delivery. Constructive delivery may occur when the things
intended to be given are not present, or when present are incapable
of manual delivery because of their weight or size.
12. Acquisition by gift causa mortis requires the intent of the donor to
make such a gift and delivery of the gift. Actual, manual delivery is
needed if the item is capable of being given and is in the presence
of the donor and the donee. Constructive delivery of the item is
deemed sufficient if the item is incapable of being manually
delivered because of its size or it is not in the presence of the donor
and donee.
vi. Gruen v. Gruen (1986) (p. 174)

21

13. Delivery - Under the circumstances, it would make no sense for

the donor to give the painting to the donee only to give it right
back again, thats just silly. It was the fathers intention for him to
keep the painting for the rest of his life, then give it to the son after
the fathers death. When you can deliver you should, but it makes
no sense to do it in this situation.
14. Not practical for painting to have shipped to son to touch it so its
been delivered. The law doesnt require empty rituals but it
does require actions to make us feel comfortable that no fraud is
occurring.
15. Synopsis of Rule of Law. In order for an inter vivos gift to be
valid, there must be intent on the part of the donor to make a gift,
delivery by the donor to the donee and acceptance of the gift by the
donee. An inter vivos gift requires that the donor intend to make an
irrevocable present transfer of ownership. Delivery of the gift can
be by physical delivery or constructive delivery, sufficient to divest
the donor of dominion of the property. Acceptance by the donee
will be presumed when the gift is of value to the donee.
16. Discussion. A valid intervivos gift, a gift made during the lifetime
of the donor, requires the intent of the donor to make a gift, actual
or constructive delivery of the gift and acceptance by the donee. A
donor can retain a life estate in a gift and constructive delivery will
be acceptable in such a situation as it would be nonsensical to
actually deliver the gift to the donee and then immediately take it
back for the remainder of the donors lifetime
vii. Items with legal documents that usually accompany them, like a car, the
sending the of the legal document counts as delivery. Delivery must be as
close to physically as possible.
viii. Intervivos & Donatio Causa Mortise Gifts
17. A gift made from one or more persons, without any prospect of
immediate death, to one or more others.
18. A gift inter vivos, when completed by delivery, passes the title to
the thing so that it cannot be recovered back by the giver; the gift
causa mortis is always given upon the implied condition that the
giver may, at any time during his life, revoke it.
19. A gift inter vivos may be made by the giver at any time; the
donatio causa mortis must be made by the donor while in peril of
death. In both cases there must be a delivery.
ix. Acquisition of Property By Gift (common)
20. Three criteria:
c. There must be an intention (shown by actions, deed,
written, etc.) on the part of the donor (giver) to give a gift.

22

Not to sell it to you or loan it but to give it. (Example:

Birthday gift is a gift).
d. There must be a delivery. You must actually physically give
the item you are giving to the person you are giving it to.
Sometimes this is not practical (house, etc.) General rule is
if something can be handed over it must be. A) Actual
delivery is you actually give the item you are giving. The
law often prefers and often requires this type of delivery.
B)The other type of delivery is constructive delivery. You
cant deliver the item itself but deliver something else like
it (example safe key, safe deposit box key, etc.). c)
Symbolic Delivery least favored. Its not constructive but
it symbolizes. Piece of paper can be symbolic. A bunch of
keys thought safe key was on chain not constructive
because none of the keys actually open the safe but you
symbolically did. Not always recognized.
e. Acceptance. This is presumed unless its rejected at that
time. If you decide to reject later on might not count as
rejection. Once the gift has been completed its been
transferred to you. You could attempt to give it back but
thats another gift.
Problems Page 152
1. Van Pelt said to Julia, I want to give you my insurance policy in that bureau over there, so
Enos please get it and give it to her. Enos, however, leaves the policy where it was. Is there a
valid gift?
Answer: No gift; no delivery was done and it was possible to do it. He couldve told Julia to
bring the papers to him and he could then hand them to Julia, if Enos is being a dick.
Problem #1.2:
What if Van Pelt instead said, I want to give you my bureau there. Enos, move it into her room.
Enos does so. The bureau contains the life insurance policy. Valid gift?
Answer: No gift of policy; but gift of bureau. Just like Newman case. The rule is very strict to
avoid fraud.
Problem #2:
Van Pelt says to Julia I want to give you my bureau and the insurance policy locked in it. Here
is the key. Julia takes the key but the bureau stays where it is. Valid gift?
Answer: He explicitly mentioned it majority says this counts he gave her the key she
herself could get it and the policy is exclusively mentioned it. Other courts say she literally has to
take it since he cant. If witness here maybe different.
Problem #3:
23

Van Pelt says to Julia I want to give you my little strong box here and the insurance policy
locked in it. Here is the key. Julia takes the key but the box stays where it is. Valid gift?
Answer: The bunch of keys that the donee got none opened the strongbox. Court said gift was
not made; maybe the box itself couldve been delivered and they failed this. She couldve tested
the box before he died to make sure courts could swing the other way if box is at the bank.
Problem #4:
Van Pelt said to his wife before he died, Dear, I give you my piano. Would there be a gift?
Answer: The wife has joint dominion over the house contents. It would count as delivery to her
house because shes already there.
HYPOS:
Fiddler on the Roof statue is given to Dolin at party at his Moms house.
He owns it because Mom intended to give to him; actual physical transfer; gift completed and he
gave it back to Mom to hold for him.
Painting mom says he can have it later.
He doesnt own it the intent is to only give it to him in the future; and no delivery.

Estates

Sometimes, possession is an abstract concept. Estates on land do not talk about the
land itself. Were talking about the ownership interest can be present possessory
interest or future possessory interest. We started talking about this in Gruen.
Younger Gruen had present ownership but future possessory interest.
Estate in property is the ownership and/or possessory interest in property. And these
interests can be diff and overlapping. As a result, there are different nomenclatures
governing these. These are extraordinarily important for the class, the bar exam,
and encounters w/ prop law in our careers. We need to make it very clear as to who
is getting what from whom.
All of our rules are geared towards the safety of free alienability. There are some
times when we want to promote other goals, like charitable purposes, but for the
most part, free alienability is the way to go.

Present or Current Interests

1. Fee Simple
2. Life Estate
3. Fee Simple Determinable Estate (Defeasible)
4. Estate subject to condition subsequent (Defeasible)
5. Estate subject to Executory Limitation (Defeasible)
a. An estate is the ownership/possessory interest in property.
24

b. An estate is a means of measuring ownership in terms of time.

c. The system has not been changed since feudal times. The estate system makes
clear what is being transferred and for how long.
d. History: Property rights promote personal individual liberty, but in feudal times, it
didnt. You owed certain duties for that land, all your life. To this day, these
obligations still stand in London one dull knife and one sharp knife, for
example, or coins placed on a checkered table cloth, and their svc is discharged
for another year. Ground rent is a remnant of that system.
e. Why we havent changed these old timey rules:
i. Settled expectations people expect to be able to use these rules
ii. Utility can be useful to create diff kinds of interest
iii. Clarity cant mistake if there is a damn rule about each possibility
iv. Lack of competition - You want it to be complicated so the riffraff cant
try to compete with you when its time for you to lawyer and shit.
f. Estate Vocab
i. Heirs are the people who survive the decedent as defined by the states
statute of descent. No one has heirs until they have died. A spouse, at
common law is not an heir. Living people have no heirs, they must be
dead. Based on the idea that the person does not know who will be alive
when that person dies.
ii. An heir is someone who takes through intestacy (from people who die
w/out a will.) Used to be the oldest son, but now we have a gender neutral
law. Spouse before children, children before grandchildren, etc. Each state
has the rule, and if there are no relatives left, the estate escheats to the
State.
iii. Issue refers not only to children but further descendants.
iv. Ancestors parents usually become heirs if the decedent leaves no issue.
v. Collaterals all persons related by blood to the decedent who are neither
descendants nor ancestors. Brothers, sisters, aunts, uncles, etc. They
inherit if no issue or ancestors.
vi. Escheat if a person dies intestate without heirs, the property goes to the
state.
vii. Devisee - One who takes through a will. You can devise your property
however you like.
g. No New Clauses Rule you cannot create a new type of estate, it must fall under
one of the types already in existence.
h. Freehold Estates:
i. Fee Simple, The Fee Tail, and The Life Estate are types. Before 1536,
these estates could only be transferred in ceremony know as livery of
seisin.
i. Types of Estates:

25

i. Fee Simple Absolute (Fee is from Fiefdom) (FS) (Biggest Estate The
Ultimate Estate)
1. unlimited ownership, the largest estate in terms of duration, it may
go on forever. The owner can sell, or pass on a fee simple to his
heirs.
2. Creation: Common: O to A and her heirs; Modern: O to A (in MD
by statute)
3. o Simplest and most complete ownership in property of land
4. o Can sell, divide, mortgage, lease, sublease
5. o Lasts forever
6. o No paramount lord above you
7. o no conditions doesnt terminate unless you choose to
terminate it
8. o even if you sell it, it doesnt create a new FS it merely sells
the same one.
9. FS estates last forever. That means that any estate that doesnt last
forever (aka is not FS absolute) will have a present interest and
future interest. The sum of both sides of that line need to add up to
the FS estate. Somebody must own the land in any given point in
time. (old Latin rule) I dont know what this means.
10. o Magic words FS is created by devising the property to:
a. A and his heirs
b. (now you can just say to A and its automatically FS)
c. While A is alive, the heirs have no interest in the land.
11. Inheritance of Fee Simple
a. No longer need to add the phrase and his heirs. The
words To A means a fee simple has been created.
ii. The Fee Tail (Abolished)
1. The estate will pass to lineal descendants generation after
generation until all descendants are dead. Then the estate will
revert to the grantor or the grantors heirs. They have largely
abolished in most states.
2. Every fee tail has a reversion or a remainder after it.
3. Magic words to A and the heirs of his body.
4. only partially alienable - You cant divest heirs of your body, and
when you die, the property goes to the next heir from the original
owner.
5. The current possessory interest you can sell your present
possessory interest but once you die, you dont own it no more.
6. Magic words to A and the heirs of his body. This estate is only
partially alienable. You cant divest heirs of your body, and when
you die, the property goes to the next heir from the original owner.

26

The current possessory interest you can sell your present

possessory interest but once you die, you dont own it no more.
iii. The Life Estate
1. The owner has the estate for life, but only for the duration of his
life. It can be transferred. If A transferred the estate to B, B only
owns the land for the duration of As life pur autre vie (For
anothers life). Then the estate passes to a reversion (remainder).
2. If life holder and remainder agree to sell or mortgage the estate,
that is allowed.
3. The Life Estate lasts a lifetime. Der. Magic words to A for
life. What happens if A wants to resell it? B only gets the property
so long as A is alive. You cannot give more than what you have. A
only has an interest in an estate for the extent of As life. So thats
all A can sell.
4. A life estate must by definition have a remainder, so a court will
construe if it can to avoid them. a. Also it cannot stand on its
own it will have to revert to the original owner, or to a 3d party,
or someone else. But it has to keep being owned. what?
5. So how do you value a life estate? Its a freehold estate. Its not a
lease; it doesnt last forever, but its yours to sell (with rights that
terminate upon your death.) The way life estate is valued is a right
to receive an annuity in the amount = to the value of the property +
interest rate. They use actuarial tables for this. Older the life tenant
is the higher the value to the remainderman. Sigh. Math. What?
6. Magic words to A for life.
7. If A sells to B, B gets possessory interest only for life
8. Pur autre vie for the others life old French for the type of
interest B gets when A has a life estate and sells it to B.
9. White v. Brown (1977) (p. 202)
a. If the intent of the will in doubt, than doubt is resolved in
favor of an absolute estate (fee simple) and against
limitations on property.
b. Synopsis of Rule of Law. Rules of construction of an
ambiguous will favors a conveyance of fee simple absolute.
c. Issue. Whether the will of the deceased, minding the rules
of construction that favors passing of property in fee
simple, clearly evidences an intent to convey only a life
estate in her home. Held. Reversed. Testatrixs apparent
testamentary restraint that her house not be sold does not
evidence a clear intent to pass only a life estate to
overcome the laws strong presumption that a fee simple
interest was conveyed.

27

d. Dissent said it was pretty clear that Jessie wished for the
house to be lived in, and not sold. Thats evidence of intent
to create a life estate. If we dug up Jessie, shed probably
agree, but the law is the law and the words are the words.

P. 168 Problems
1) O conveys Blackacre in 1600 to A for life, then to B forever. What interests? A has
life estate, than B also has life estate b/c its 1600 and you had to say and heirs back
then.
2) O conveys Greenacre to A and her heirs. As only child B is a spendthrift. Can Bs
creditors attach Bs interest in Greenacre? None - B has no interest in As land while A is
alive.
Suppose A decides to sell Greenacre to take a world trip and B doesnt like it. Can B stop
A from doing this? No B has no interest in Greenacre, no matter how mad he is at his
mom.
There is a way to give land to As heirs while alive. You can do that, except you have to wait to
find until A is dead to find out who those people are. Its an unknown group while A is alive.
Say you have land that goes from A for life to B for life to C for life at the end of Cs life, it
reverts to O.
P. 169 Problems
1) O has 2 children - A and B. B dies testate, devising all his property to W. B is survived
by three children, A has one kid. Then O dies intestate. Who owns Blackacre under
American law? A and to B1, B2, and B3. That is the direct line of descendancy. W got
nothing, because when B dies, he had no interest in Os property. Bs descendants get
whats left.
So it goes O spouse child childrens children, etc. If no spouse, straight to
children. If then no children, to collaterals parents, then brothers and sisters, etc.

28

2) O conveys Blackacre to A and her heirs. If A dies intestate without issue, will
Blackacre escheat to the state? Only if he doesnt have collaterals brothers, sisters,
parents, spouse, etc.
Its like a pre-fixe menu with no substitutions allowed. Suppose you want to give land to your
granddaughter, but fuck her mom (your daughter-in-law) and her family. How do you make sure
it goes straight to your granddaughter? Create a life estate youd write to my granddaughter
for life, and then to the heirs on her fathers side. You just have to put the commas in the right
places.
Say O has land he owns in a fee tail. He sells to A, who can stay so long as O is alive. O dies,
and the property reverts to the next closest heir of the body of the original title holder. (Nobody
will lend on fee tails, b/c you cannot foreclose on the heirs of my body.) It makes it hard to sell,
improve, subdivide the land. We like land to be bought and sold, freely. We like alienability in
land so people can put it to better use. So fee tail = bad law (except for old timey states where
there are still some in play, like, sadly, MD.)
As life estate + remainder (reversion to O) = FS absolute. what?
Lets take a look at why language is so important in property law. White v. Brown decedent
(Jessie Lide) passed away and wrote a holographic (meaning by hand) giving her house to her
sister, and the rest to her niece.
P
Brown

D
v.

Other heirs of Jessie say it was merely a life

estate that conveyed. Once Jessie passed
away, White (mom) had a life estate, and
when she died, they get the interest in the
estate by reversion.

White
Want to sell property (Jessie left house to
them in FS so they can do what they need
to with the house.) They claim not being
able to sell the house is unfair
infringement of policy against
inalienability, conditions are unlawful b/c
its FS and so they should get to sell.

Issue:

What kind of estate did Jessie create by saying my house is not to be sold? A
life estate with a remainder or a FS subject to condition?

Rule:

Construe documents against restrictions, and for complete disposition. Policy

presumption to FS absolute, so any chance to read it that way, they will. Meaning
of will is deduced by context, policy, and circumstances.

Judgmen
t

D wills pass everything to the grantee

unless the intent to do otherwise is
unmistakably clear.
29

for:

Our options here were:

1) Life estate w/ remainder
2) FS absolute subject to a condition (which would be struck b/c you cant have
conditions with FS absolute.)
All they had to do was strike the condition, and they are done with this. We dont permit
restrictions on alienation absolute ownership means absolute ownership, the end.
Takeaways:
1) Restraints on alienation for FS absolute are prohibited b/c that would make the
property unmarketable, prevents the land from being put to its best use.
a. Presumption of FS absolute prevents the concentration of money.
Money should be out in the market, not sitting in one guys coffers.
b. Presumption of FS absolute prevents discouragement of investment.
2) Language is extraordinarily important. There is a way to accomplish what Jessie
wants. She could have said, to my sister, Evelyn, for life, and then to [name a niece.]
Couple of other points sometimes possession is merely an abstract. A remainderman has an
ownership interest even while A is alive. But sometimes, A doesnt give a fuck and treats the
property like shit. B has no right to come in on the land until A dies. So how can B protect his
interests? Via the Doctrine of Waste. What B can do is sue A for the waste that A has effected on
that property.
Affirmative waste when A does a thing that affirmatively destroys the property
value. B can sue for an injunction for A to knock it the hell off.
Permissive waste when A doesnt upkeep the property. More like negligence, and
B can sue for an injunction or damages. Usually its damages so B can upkeep the land.
Ameliorative waste when As actions that improve the lands value change it so B
doesnt get the land in the condition it was in when the initial point of transfer occurred.
Any material alteration can give rise to damages or an injunction.
o Think of siblings, S1 has a life estate and S2 has a remainder. S1
wants to tear down an old barn to improve the value, but S2 says nuh-uh, I
30

want it to stay the same b/c thats like the barn where I got my cherry
popped. Whatevs.
Point is that changes caused by A let B sue.
Next well talk about Defeasible Estates. (Well cover leaseholds another day.)
1. Restrictions on a fee simple allow for: the concentration of wealth,
discourages investment (no mortgages)
f. Disabling Restraint withholds from the grantee the power
of transferring his interest
g. Promissory Restraint provides that the grantee promises
not to transfer his interest (rare except in landlord-tenant
issues)
h. Forfeiture Restraint provides that if the grantees attempts
to transfer their interest, it is forfeited to another person
2. How to value a life estate figure out how the whole estate is
worth and figure out the how much is the estate worth per year.
Approximate annual rate of return calculated with the persons life
expectancy.
3. Doctrine of Waste: When two or more persons have rights to
possess a property at the same time. Affirmative Waste, Permissive
Waste and Ameliorative Waste.
4. In general: A life estate should always be avoided. Create a trust
instead.
i. No sale, no mortgage, no duty to insure and if the tenet
does insure the tenet gets all the insurance money. Leases
are limited to life of the person.
j. Life tenet cannot take minerals out of the land or cut
timber.
k. Permissive waste negligence failure to take reasonable
care of the property, which can result in the loss of the life
estate.
l. Because the remainderman has no remedy to the life
tenants hurting the value of the estate, so the
remainderman can get an injunction against the life tenet.

a. Leasehold Estates
x. The tenants only lease the land and do not own it. Lease holders do not
have siesin. (Leases covered later)

b. Defeasible Estates

31

Defeasible Estate is an Estate that will terminate prior to its natural endpoint upon the occurrence
of some sort of specified event.
Example: What is the natural end point of a life estate? Grantee dies. Its natural end point is
death so its not terminating early.
Defeasible is something that can do either naturally at death or earlier.

xi.

These estates will terminate prior to its natural end point. Can be
conditional and a violation of which will result in forfeiture of ownership.
Purpose is to control land use or behavior.
xii. So why do this? The Grantor wants to have land use control over the
property (such as giving it away for free to a charity). You can also use it
to control Grantees behavior (such as giving it to Grantee only if they
dont consume alcohol on the premises)
xiii. Three types:

21.

Fee Simple Determinable (on a special limitation) - will

end automatically when stated event happens
m. using words like So long as, While, During, Until
n. Every Fee Simple Determinable must be accompanied by a
future interest, to grantors heirs called a possibility of
reverter.
o. Type of Fee that terminates automatically upon the
occurrence of some type of event the grant is inherently
limited by this event. (Property given as a park; the
moment the property is no longer a park, the Estate
terminates). You have to use some magic words = you cant
use words that merely state a purpose.
p. Duration: Depends on the estate and the condition.
q. Creation: What are the magic words?: Temporal
limitations: Until, so long as, as long as, while and during.
r. Example: Blackacre to A until A sells alcohol there.
s. Possibility of a reverter. Theres no such thing as a reverter
there is only the possibility of a reverter. There is a
reversion which accompanies everything less than a fee
simple absolute.
t. Mahrenholz v. County Board of School Trustees
u. Brief Fact Summary. An action to quiet title to property
rests upon the issue of whether the original deed conveyed
a fee simple determinable with possibility of reverter or a
fee simple subject to condition subsequent with a right of
re-entry.
v. No magic words in the Deed which gives rise to the case.
All of this couldve been avoided if written properly.
32

w. Court says: The difference between the two types of

defeasible estates is the words used.
x. Theres an important difference between a right of re-entry
and the possibility of a reverter. A right of re-entry is not
automatic you must assert certain rights. Possibility of
reverter on the other hand is automatic once a condition
has been broken, you regain the right to enter the land.
y. Synopsis of Rule of Law. The common law states future
interests in land by possibility of reverter or right of reentry are inheritable, but are not transferable by will or by
inter vivos conveyance. The use of the word only in a
deed followed by the words for school purpose,
demonstrates a limited grant subject to a condition, thus,
creating a fee simple determinable. The phrase, otherwise
to revert to grantors herein coupled with the limiting word
of only triggers a mandatory return.
z. Issue. Whether the language of a conveyance properly
conveyed an interest in real property.
aa. Held. Reversed and remanded. The language in the deed
created a fee simple determinable followed by a possibility
of reverter.
ab. Discussion. A future interest gives the holder the right or
the possibility of an estate. A fee simple determinable
conveys a possibility of reverter that automatically reverts
to the grantor upon the occurrence of a stated event. A fee
simple subject to a condition subsequent conveys a right of
entry that is not automatic, but the grantor must exercise his
right of entry. The significance of this case is during this
time period these future interests could not be conveyed by
inter vivos gift or sale, thus the only way the Plaintiffs
could have acquired the school land was if the grantor in
the case had a present interest in the land to convey.
22.
Fee Simple Subject to Condition Subsequent - will not
automatically end but may be cut short at the transferors election
when stated condition happens
ac. using words like But if, However, Provided that, On
condition that.
ad. Duration: Depends on the estate and a condition and the
action of the grantor.
ae. Estate will end upon the occurrence of a certain event and
assertion of a right by the grantor.
af. The underlying estate e.g., a determinable life estate.
33

ag. Creation: A to A, (limitation)(condition)

ah. Example: O to A, but if A builds a pool, O retains a right of
re-entry.
ai. Conditions: Magic Words: But if, provided that, on
condition that, however
aj. Example: Blackacre to A, but if A sells beer there, O has a
right of entry.
ak. Future Interest = Right of re-entry.
23. Fee Simple Subject to Executory Limitation - when the future
interest is given to a third-party. The remainder is left in a third
party. (just like the fee simple determinable estate but with a
limitation that a third party could get the land upon event)
24. Duration: Depends on the estate and a condition
25. Estate will end upon the occurrence of a certain event
26. Creation: The estate is drafted as a determinable estate or an estate
subject to condition subsequent BUT the future interest is held by
someone other than the grantor.
27. Example: O to A, until A owns a home, then to B.
28. Future interest is an executory interest.
xiv. The reverter or remainder may never take possession of the land, unlike a
life estate where the remainder will eventually take control of the estate.
xv. Under common law, a person could not transfer their interest while alive.
Today, most states allow the reverter and the right of entry to be
transferred in life.
29. Hypo if school conditionally given land, starts drilling for oil.
Can the reverter sue the school to get some of the profits or an
injunction? The school would likely keep the oil profits because
the land is treated as a Fee Simple Absolut until the condition is
violated. There is no way to calculate the value of the oil if the
school ever violated the condition, the school may last forever.

Mahrenholz v. County Board of School Trustees HYPOS:

What if it was a right of re-entry issue. Could you sell it pre-1973? Still no speculative interest.
What about 1977? Yes, but youd have to first re-enter the property. You cant sell a right of reentry its a speculative right.
HYPO. What happens if the deed was properly written; no one died; and the grantor lets it go
he didnt give it away or exert his rights; and the schools response would be adverse
possession over the 1.5 acres plot.
Review Problems Page 191 - The answers are in the book apparently.
1. A has a Fee Simple Subject to Condition Subsequent; O has a right of re-entry (identify
the future interest) (also identify should that future interest actually be exercised, what
would O have?) in Fee Simple Absolute. This is then a complete full answer.

34

HYPO: To A for life, unless he raises horses, then to B for life. A has a life estate subject to
executory limitation. B has an executory interest in a life estate. O has reversion in Fee Simple
Absolute.
2. Cannot devise, sell or transfer right of re-entry, so B doesnt have anything. So Os heirs
have the right of re-entry in Fee Simple Absolute. They get nothing until they actually reentry.
3. A has Fee Simple Determinable; O has a possibility of reverter in Fee Simple Absolute.
4. B owns Blackacre in Fee Simple Absolute (if the construction started before O died). If
construction started after O died, then only Os heirs get Fee Simple Absolute.
5. Finger Lakes Land Trust has a Fee Simple subject to Executory Limitation; Land
Conservancy has executory interest in Fee Simple Absolute.
6. A has a Fee Simple Absolute (not a condition since there are no magic words here).
7. A can do whatever he wants, he has Fee Simple Absolute. Remedies available
injunctions, etc. Well discuss these later in semester.
8. In beginning, A has Fee Simple Subject to Executory Limitation; at time of conveyance,
B has that executory interest in Fee Simple Absolute (if A drinks alcohol, B would get it
in Fee Simple Absolute); now B contends to sell it; NOTE - Executory Interests are
transferrable NOTE so the opposite of Re-entry rights, etc. So after A starts drinking,
C owns the land in Fee Simple Absolute, as B sold his rights to C.

Future Interests
Future Interests Summary
1) A Deed can create not just present but future interest in property.
2) Future interests are not mere expectations but are actually legal ownership interests that may
or may not become possessory. Its more than a mere hope more than a mere expectation. ITs
a legal interest that you have today.
3) Future interests may be vested or contingent on some events. Maybe either in the transferor or
another transferee.
4) Choosing a future interest is like choosing a prefix menu only certain things go with certain
other things. For example, Executory Interests can only go with executory interest subject to
divestment. On the other hand, an alternative contingent remainder must go with another
alternative contingent remainder. There are no substitutions.
5) In determining all the interests present in the property, it may help drawing a line to infinity
and see how far each created interest goes and whether anything is left. Present possessory
interest and future interest together must add up to the original interest in the transferor.
Transferor transfers what he has he transfers less than what we had cant transfer more that
means he retains something whatever that may be. Ultimately it all adds up to FEE simple
absolute. No land is without an owner.
6) Each future interest created is an interest in some type of Estate. (i.e. once that interest
becomes possessory what type of estate will you get?). You must tell interest in what. In other
words, you have to ask, what type of estate will the holder of a future interest actually acquire
once he comes into possession. Give full names.
35

7) In determining the actual estate created, the language in the deed is of paramount importance.
ITs all about language. You must read a deed clause by clause because often functionally
identical but grammatically different language will created radically different interests. We saw
this in problems 6 and 7. Seemingly identical, but placing commas in different places will
created very different interests. Thats important because the type of interest created will
potentially impact its alienability and other factors. Like examples 27 and 28.
I.

Future Interests
i. No sane person would have come up with this system originally; it
evolved over time that is why it is very complicated. But need to know
it for the bar exam.
ii. All the interest together must add up to FSA. Everything transferred must
add up to what the transferor transferred. The language in the deed is
important, must read it line by line b/c many different results can happen.
iii. Hierarchy of estates: fee simple absolute, (fee tail), life estate, lease hold.
b. Future Interests in the Transferor
1. Future interest gives present legal rights on future interests.
2. Not just an expectation that something will happen present day
legal rights even if it doesnt given present possessory interest
ii. Reversion is created when the holder of a vested estate transfers to
another a smaller estate. Whenever an owner carves out an estate lesser
than his own a reversion is created.
iii. Reversions are freely alienable you can sell them, lease them, place in
your Will, etc., because they are vested interests. Both intro vivos and
causa mortis.
iv. Reversion: An interest retained when the holder of a vested estate transfers
an estate of a lesser quantum.
v. Rules: All reversions are retained interests. They are all vested in the
transferor which means they dont have to satisfy any condition
precedent. He transferor doesnt have to do anything to take possession of
the property if they do get it back.
vi. anything less than Fee Simple Absolute- carve out estate less than your
own
vii. Always vested (can be subject to divestment) as soon as other estate is
up grantor gets land back
viii. Not certain to be possessory can be divested
NOTE THERE IS NEVER A POSSIBILITY OF REVERSION!
a. Example: If O, a fee simple owner, granted the land to A for life, the
land would revert (come back) to O at As death. Os right to future
possession is called a reversion. If O dies during As life, Os reversion
passes under his will or to his heirs, and at As death whoever owns the
reversion is entitled to possession of the land.
b. Example: O conveys Whiteacre to A for life, then to B and her heirs if B
survives A. O has a reversion in fee simple that is not certain to become
possessory. If B dies before A, O will be entitled to possession at As

36

death. On the other hand, if A dies before B, Os reversion is divested on

As death and will never become possessory.
ix. Possibility of Reverter - Arises when an owner carves out his estate a
determinable estate. It is a future interest remaining in the transferor or his
heirs when a fee simple determinable is created.
x. Possibility of Reverter HYPO: O owns property; owner conveys property
to A premised on nonoccurrence of an event. The ownership of A is
terminated any time the conditioned event occurs, the property
immediately reverts back to O. Then O resumes possession. This is
immediate and automatically.
a. Example: O conveys Blackacre to Hartford School Board so long as
used for school purposes. Thus O has a possibility of reverter.
xi. Right of Entry - Arises out of an estate subject to condition subsequent,
whereas the owner retains the power to cut short or terminate the estate,
then the transferor has a right of entry.
a. Example: O conveys Whiteacre to Hartford School Board, but if it
ceases to use the land for school purposes, O has the right to re-enter and
re-take the premises.
c. Future Interests in Transferees
Remember classify interests in sequence as they are written!
Short Cut Rules:
1. If LE + FI(1) + FI(2) and FI(1) = CR(in a FS), then FI(2) = CR.
2. If LE + FI(1) + FI(2) and FI(1) = VR (in a FS), then FI(2) = EI.
3. If LE + CR(FS) + CR(FS), then REV (in FS).
Remainders vs. Executory Interests: Remainders are capable of (i.e. do not
do so necessarily) taking effect in possession upon the natural expiration of
the possessory estate immediately before them. Executory Interests, which
take effect in possession only by divesting (i.e. cutting short) the interest
before them.
Decision Tree for Classifying Future Interests
Step 1: Remainder (REM) _______ or ________ executory interest (EI)?
Step 2: If REM, vested remainder (VR) or contingent remainder (CR)?
Step 3: If VR, vested how? Indefeasibly, or subject to open or subject to
complete divestment or more than one?
With Future Interests its not a mere expectation that something will
happen. Its not a hope that you will win the lottery. Its a legal right that you
have today its not guaranteed to have you holding property but its a
present legal right. Some interests may be different, subject to conditions, etc
the legal right is still there even if actual possession doesnt occur until the
future.
i. Remainders (Always say remainder in what).
37

1. Vested Remainders: 1) It is given to an ascertained person at time

of deed, and 2) It is not subject to a condition precedent other than
natural termination (death). They may be subject to a condition
subsequent.
a. Vested remainder in.
b. Ascertained person AND no condition precedent
c. Vests after natural termination of previous estate
d. 2 kinds
i. Vested indefeasibly = certain to divest
ii. Vested defeasibly = something can occur to divest it
partially or wholly
2. Vested subject to open children
3. Vested Remainder it must satisfy two requirements first it must
be given to an ascertained person/group of people that cannot
expand at the time of the deed; and it must not be subject to any
condition precedent before you can take it natural end point of
life is not a condition
4. Once vested, it can be vested defeasibly or indefeasibly.
5. Indefeasibly means = it will at some point in time you are
guaranteed to at some point possess this property (it might take
awhile)
6. Defeasibly means = you can lose your interest in whole or in part if
some specified events occur in the future.
7. Vested remainder accelerates into possession immediately.
8. Vested remainder at common law they can be sold, transferred,
assigned, etc.
9. Vested remainder you can sue the current owner for waste
committed on your land.
10. If language is ambiguous, court will say its a vested remainder
with an executory interest.
a. Can be: Indefeasibly vested: the remainder is certain of
becoming possessory in the future and cannot be divested.
Or Vested subject to open or vested subject to partial
divestment: if later-born children are entitled to share in the
gift.
b. Vested remainders have always been transferable during
life as well as death.
c. VRs are not subject to the Rule Against Perpetuities.
d. -Vested Remainder (he called this remainder)
e. Remainder: Interest retained when the holder of a vested
estate transfers an estate of a lesser quantum and then
conveys the remaining interest to a third party.
f. Example: O to A for life, then to B.
g. NOTE: Theres no such thing as a possibility of
remainder

38

h. A remainder is a future interest that sits around and waits

patiently until the termination of the preceding
possessory estate. The remainder than moves in to possess
as long as there is no condition
i. -Vested Remainder Example: O owns property; owner
conveys smaller quantum of property to A; remainder to B.
Example: O conveys to A for life, then to B and her heirs. B has an indefeasibly vested
remainder certain to become possessory upon termination of the life Estate. If B dies during As
life, on Bs death, Bs remainder passes to Bs devisees, or, if B dies without a will, passes to Bs
heirs, or, if B dies without a will and without heirs, escheats to the State. B or Bs successor in
interest is certain to take possession upon As death.
11. Contingent Remainders: 1) It is given to an unascertained person
(or unborn person), or 2) It is made contingent upon some event
occurring other than the natural termination of the preceding
estates (basically subject to a condition precedent).
a. Contingent remainder in
b. Unascertained person OR condition precedent
12. Alternative contingencies
13. Remainders go into possession immediately after the current estate
is up if time passes, even a day = executory interest
14. READ CLAUSE BY CLAUSE BEFORE COMMA
CONTINGENT REMAINDER, AFTER COMMA VESTED
15. Always remember if A does not have children yet they are
contingent***
a. A contingent remainder was not assignable during the
remaindermans life and hence was unreachable by
creditors. Thus Contingents are impossible to value.
b. Contingents are destroyed if they did not vest upon
termination of the preceding life estate.
c. Contingent remainderman dont have standing to sue for
waste.
d. CR are subject to the Rule Against Perpetuities whereas
VRs are not.
e. Contingent remainders never accelerates into possession
until the condition is met.
f. Contingent remainders: cannot be sold, valued, etc. They
are not assignable at common law. At common law
contingent remainders were also destroyed if the condition
that must be satisfied is not satisfied. Most states have
changed this via statute.
g. And the other way is subject to condition precedent. This is
a condition that must be satisfied before an estate can
become possessory.

39

h. Contingent remainders: at common law you cannot sue the

current owner for waste commited on your land.
Example: O conveys to A for life, then to As children and their heirs. A has one child, B. The
remainder is vested in B subject to open to let in later-born children. Bs exact share cannot be
known until A dies. If A has no child at the time of conveyance, the remainder is contingent
because no taker is ascertained.
Example Contingent because takers are unascertained: O conveys to A for life, then to the
heirs of B. B is alive. The remainder is contingent because the heirs of B cannot be ascertained
until B dies. This paradox has a long history!
Example Contingent because it is subject to condition precedent: O conveys to A for life, then
to B and her heirs if B survives A. The language if B survives A subjects Bs remainder to a
condition precedent. B can take possession only if B survives A.
Example Alternative Contingent because it is subject to a condition precedent: O conveys to
A for life, then to B and her heirs if B survives A, and if B does not survive A to C and his heirs.
The language if B survives A subjects Bs remainder to the condition precedent of B surviving A,
and the language if B does not survive A subjects Cs remainder to the opposite condition
precedent. Thus if the remainder in B vests, the remainder in C cannot, and vice versa.
HYPO: to A for life then to As heirs. A doesnt have heirs they are alive. A got fee simple
absolute (A gets both life estate and the remainder and together they add up to fee simple
absolute).
HYPO: O to A for life then to B if B is not a lawyer.
FULL EXAM ANSWER: A has a life estate, B has a remainder subject to condition precedent
that he is not a lawyer, in fee simple absolute and O has a reversion in fee simple absolute,
subject to divestment by B. There is no gap here. At As death, well know immediately if B is a
lawyer or not.
NON-HYPO: O to A for life, then to B so long as B is not a lawyer. This is not condition
precedent this is a condition subsequent. As soon as he becomes a lawyer at any time, he loses
the land.
NON-HYPO: O to A for life, then to B, but if B becomes a lawyer, to C.
16. Executory Interests - Is a future interest in a transferee that must,
in order to become possessory:
a. Divest or cut short some interest in another transferee
(shifting executory interest); OR
b. Divest the transferor in the future (springing executory
interest)
c. Its a future interest following an estate subject to an
executory limitation.

40

d. Executory interest in ..
i. Shifting take from grantee
ii. Springing take from grantor
iii. If vested -> next is executory interest
e. MUST SAY WHAT YOUR INTEREST ATTACHES TO
f. ***VESTED OR CONTINGENT (EI IS CONTINGENT),
WHAT IS IT, WHAT IS IT ATTACHED TO
g. CL could not sell contingent remainders and creditors
could not reach them, , and could not sue for waste
h. Now you can
i. If it goes to someone based on someone surviving A and A
dies and then child dies go to childs heirs because he did
survive A
j. All interest must add up to FSA*** or original interest in
transferor
k. Example: O to A until A owns a horse, then to B. A has a
fee simple subject to executory limitation and B has a
shifting executory interest in fee simple absolute.
l. Example: Mule HYPO (LOOK AT SLIDE)
i. Shifting and Springing Executory Interests
difference is who had the previous interest? Grantor
or another transferee.
ii. If the Grantor had the previous interest its called
Springing.
m. Example: To A when he is 21. If he reaches 21, it springs to
him and takes the land.
n. If the transferee had the previous interest its called
Shifting. It shifts the interest from A to B.
o. Example: To A, but if B becomes a lawyer, then to B.
p. Remember you cant give more than what you have.
Remember the Estate Hierarchy.
q. Not Executory Interest: TO A for life, once A dies, then to
B. Thats a natural end of As life estate not an executory
interest. There is no divestment.
r. Executory Interest: To A for life, but when A smokes, then
to B. If A starts smoking, then Bs executory interest divests
A.
s. Transferee = shifting executory interest
t. Transferor = springing executory interest
u. Under Common Law Executory Interests are different
from Contingent Remainders because of the way the law
followed. EIs are read differently for the purpose of RAP
from Contingent Remainders. If EIs violate RAP, different
rules follow.

41

Example: O conveys to A and his heirs, but if A dies without issue surviving him, to B and her
heirs. A has a possessory fee simple subject to an executory limitation (or subject to divestment
by Bs executory interest). Bs future interest can become possessory only by divesting A.
Example: O conveys to A for life, then to B and her heirs, but if B dies under the age of 21, to
C and her heirs. B is age 15. B has a vested remainder in fee simple subject to an executory
limitation (or subject to divestment by Cs executory interest if B dies under age 21).

Example Distinction between Contingent Remainder and Vested Remainder Subject to

Divestment: O conveys to A for life, then to B and her heirs, but if B does not survive A to C
and his heirs. B does NOT have a contingent remainder B has a vested remainder in fee
simple subject to divestment; C has a shifting executory interest which can become possessory
only by divesting Bs remainder.
Problem 1 Page 196. O owns a fee simple and makes the following transfers. In which cases is
there a reversion.
a) O conveys to A for life, then to B and her heirs. No reversion there is no way A wont die.
B doesnt have to satisfy any conditions once A dies, B takes the property. No possibility that O
will retain property.
b) O conveys to A for life, then to B and the heirs of her body. Yes, reversion if B has no
heirs of the body. The bloodline might die out and the O would get reversion. If O is dead, it
would revert to Os heirs.
c) O conveys to A for life, then to B and her heirs if B attains the age of 21 before A dies. At
the time of the conveyance B is 15 years old. (If there is a reversion, what happens to it if B
reaches 21 during As life?) Yes, there is a reversion. If B doesnt satisfy the condition, it will
revert back to O. NOTE: Os reversion is vested. If B hits 21, then Os reversion is subject to divestment.
d) O conveys to A for 20 years. Yes, at the expiration of 20 years, O will get the land back.
2) O conveys Blackacre to A for life, then to B for life. O subsequently dies with a will
devising all of Os property to C. Then A dies and B dies. Who owns Blackacre? C will own
Blackacre; reversions are transferable, even under a Will. So now C is the owner of Blackacre.
HYPO: O conveys Blackacre to A for life, then to B if B gives A a proper funeral. Does B
have a remainder or an executory interest? If it is an executory interest, whose interest will be
divested if B gives A a proper funeral?
What happens when A dies? B doesnt take it because he hasnt satisfied the condition. During
the gap A has a life Estate, O has a reversion but if B gives A a proper burial, does B take the
property then? Yes, once he satisfies the condition, he divests O of his property interest. This is
not a remainder it doesnt sit patiently. Once As estate ends, B hasnt met the condition, so it
reverts back to O until B satisfies the condition.
Full Exam Answer: A has a life estate, O has a reversion in fee simple absolute subject to
divestment by B who has an executory interest in fee simple absolute.
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Example 7: O conveys to A for life, then to B and her heirs if B survives A, and if B does not
survive A then to C and his heirs. These are alternative/alternate contingent remainders in B and
C. If it vests in B, nothing vests in C it is destroyed. Vice versa if it vests in C.
1. O conveys to A for life and in the event of As death to B and her heirs. Is Bs remainder
vested or contingent? Answer: It is vested, B does not have to do anything to satisfy the
condition of As death. If B subsequently conveys her interest back to O, what does O have?
Answer: O would have a vested remainder. We only care about the name of remainders upon the
time of birth at the time of this Deed being executed, there was a life estate and a vested
remainder. B only has a vested remainder to give and thats what he can give to O.
2. O conveys to A for life, then to B for life, then to C and her heirs. What interests are
created? Suppose the remainder to C had been then to C and her heirs if C survives A and B.
What interests are created? Answer: A has a life estate, B has a vested remainder in life estate, C
has an indefeasibly vested remainder in fee simple absolute. Answer: A still has a life estate, B
still has an indefeasibly vested remainder in life estate, C has contingent remainder subject to
condition precedent and O has reversion.
3. O conveys to A and B for their joint lives, then to the survivor in fee simple. Is the
remainder vested or contingent? Answer: This is given to an unascertained person A has a
contingent remainder and B has a contingent remainder (Alternate contingent remainder) and O
has a reversion (technically) since A and B could die at the same time.
4. O conveys to A for life, then to As children who shall reach 21. As oldest child, B, is 17. Is
the remainder vested or contingent? B subsequently reaches 21. Is the remainder vested or
contingent? Answer: Bs part is contingent, and its vested subject to partial divestment if there
are other siblings coming along.
Problems Page 204
(1) O, owner of Wiseacre, comes to you to draft an instrument of gift. O tells you he wants to
convey Wiseacre to his son A for life, and upon As death O wants Wiseacre to go to As children
if any are alive or, if none are then alive, to Os daughter B.
O conveys to A for life then to As children and their heirs, but if at As death he is not survived
by any children, then to B and her heirs.
Answer: A has a life estate; As heirs have a contingent remainder in fee simple absolute. B has a
contingent remainder in fee simple absolute. These are alternate contingent remainders.
What if kids are both? Then As childrens remainder vests the gift doesnt say that the children
must survive.
Suppose that C dies in As lifetime, and that A is survive by B and D. What is the state of title?
D has a fee simple absolute along with the heirs of C; Bs interest is destroyed.
(1)(b) O conveys to A for life, then to such of As children as survive him, but if none of As
children survives him, to B and her heirs. At the time of the conveyance, A is alive and has two
children, C and D.
Answer: A has a life estate; As children have a contingent remainder; theres a reversion to O.

43

Theres no requirement that B survive A for his heirs to take possession.

(1)(c) O conveys to A for life, then to B and her heirs, but if A is survived at his death by any
children, then to such surviving children and their heirs. At the time, A is alive and has two
children, C and D.
Answer: A has a life estate; vested remainder in fee simple absolute, subject to divestment;
executory interest
(if one remainder is vested - then the other cant be contingent must be executory)
(2) T devises 10,000 to my cousin Don Little, if and when he survives his wife. What does Don
Little have?
Answer: Springing Executory Interest. If he survives his wife, he gets 10,000. T has fee simple
determinable.

Rules Furthering Marketability by

Destroying Contingent Future Interests
(ONLY NEED TO KNOW RAP)
17. To destroy contingent interests and make land more marketable,
judges have developed four rules:
a. Destructibility of Contingent Remainders: ABOLISHED.
Example: O conveys Blackare to A for life, then to B and
her heirs if B reaches 21. If at As death B is under the age
of 21, Bs remainder is destroyed. O now has the right of
possession.
Example: O conveys Whiteacre to A for life, then to B and
her heirs if B survives A. A conveys his life estate to O,
the life estate merges into the reversion, destroying Bs
contingent remainder.
b. The Rule in Shelleys Case: The life estate cannot merge
into vested into remainder in fee simple if there is an
intervening life estate. The Rule has been abolished in
most states.
Example: O conveys Blackacre to A for life, then to As
heirs. The Rule in Shelleys Case gives A a vested
remainder in fee simple. As life estate then merges into the
remainder, leaving A with a fee simple in possession. The
land is immediately alienable by A and not tied up for As
lifetime.
c. The Doctrine of Worthier Title
Example: O conveys Blackacre to A for life, then to Os
heirs. In the absence of Worthier Title Doctrine, there is a
contingent remainder in favor of Os unascertained heirs.

44

Under the WTD, no such remainder exists, instead O has a

reversion.
d. Rule Against Perpetuities (RAP) ***

The Rule Against Perpetuities

No interest is good unless it must vest, if at all, not later than
twenty-one years after some life in being at the creation of the
interest

Modern: can you come up with a

scenario where the interest could
vest outside of the 21 year period
after someones death?
If yes, the interest is invalid as of
today.
CREATE, KILL, COUNT

Look at the conveyance

Only people we care about are the A, B, Cs
of the conveyance (lives in being at the
creation of the interest)
Create imaginary kid

a. The rule strikes any interest that does not vest within 21 years after the end of life
that exists at the time the property is granted. The offending clause will be
stricken from the deed. Rule strikes out any interest that does not necessarily vest
or fail with 100% certainty within 21 years of the life currently in existence. The
Rule considers all aspects, no matter how crazy (fertile octagregarian and unborn
widow).
b. Remember: Each interest created must be tested separately. Just because one
interest satisfies the rule doesnt mean all of the interests satisfies the rule. The
validating life can also be different for each interest.
c. REMEMBER: You measure the validity of the deed TODAY when the deed is
signed.
d. PICK A LIFE; GIVE THEM A KID; KILL THEM OFF & SEE WHAT WILL
HAPPEN IN 21 YEARS.
e. Policy to Prevent:
i. Furthering alienability of property
ii. Furthering productivity of property
iii. Preventing undue concentration of wealth
45

iv. Prohibiting excessive dead-hand control

v. Prevent uncertainty
f. Only applies to:
i. Contingent Remainders
ii. Executory Interests
iii. Vested Remainders subject to open
1. A class gift is not vested in any member of the class until all
members have vested, all or nothing rule.
g. Four Step of RAP
i. Determine which future interests have been created
ii. Identify the conditions precedent to the vesting of the suspect future
interest (what has to happen before the future interest vests)
iii. Find a validating life
iv. Ask: Will we know for certain, within 21 years of the death of the
validating life, whether the future interest will vest?
Example: O transfers a sum in trust for A for life, then to As first child to
reach 21. A is the validating life. You can prove that any child of A who
reaches 21 will necessarily reach 21 within 21 years of As death. The
remainder must vest or fail within this period; it cannot possibly vest more
than 21 years after A dies. The remainder is valid.
Example: O transfers a sum in trust for A for life, then to As first child to
reach 25. A has no child age 25 or older. There is no validating life; the
contingent remainder is void. You cannot prove that As first child to reach
25 will do so within 21 years after As death.
h. Validating life
i. Could be anyone, but should be someone connected to the deed. A child in
the womb is considered to be alive for this rule. The validating life must
be alive at the time of conveyance. The key is that to be a validating life, a
person must be someone who can affect vesting or termination of the
interest.
ii. A validating life can be anyone and be named (The Rockefeller Heirs) in a
saving clause, but must be alive at the time of conveyance.
iii. At the validating lifes death, the 21 year clock begins ticking. At the end
of that period, the life will vest or it will fail.
Example: T devises property to my grandchildren who reach 21. T leaves two children and
three grandchildren under 21. The validating life is the survivor of Ts two children. All of Ts
grandchildren must reach 21, if at all, within 21 years after the death of the survivor of Ts two
children. Therefore, the gift is valid.
Example: T devises a sum in trust for A for life, then to As children for the life of the survivor
of them, then upon the death of the last surviving child of A, to As grandchildren. At the time of
Ts death, A is an 80-year-old woman with two living children, B and C. The remainder to As
grandchildren is void. The invalidating chain of possible events is the following: After Ts death,
A might have a child, X, who in turn has a child, Y, conceived and born more than 21 years after

46

the death of the survivor of A, B, and C. It matters not how unlikely it is that an 80-year-old
woman would conceive a child. Under the common law RAP, it must be assumed that a person
of any age can have a child, no matter what the persons physical condition. The presumption of
lifetime fertility is conclusive, notwithstanding contrary evidence. Even a child might conceive a
child under this viewpoint.
iv. Class Gifts
1. Class Gifts: The all or nothing rule. A class gift is not vested in
any member of the class until the interests of all members of the
class have bested. A gift that is vested subject to open is not vested
under the RAP. For a glass gift to be vested under RAP, the class
must be closed (that is, each and every member of the class must
be in existence and identified), and all conditions precedent for
each and every member of the class must be satisfied, within the
RAP period.
2. Gifts to groups of unascertained people like children or
grandchildren. They are contingent because they are subject to
open. Even a transfer that is vested but subject to open, then RAP
does not consider it vested. Since you could have a smaller share
than expected its a contingent remainder. This is an all or
nothing rule for class gifts
3. Rule of Convenience Equitable doctrine. Under this rule,
transfers to classes may be treated as closed (and therefor not
subject to open) if any member of the class can be vested (can take
now). This ROC cuts off the new entrance of the class/recipients of
transfer.
Example: A gift to A for life, then to As children, and A has living one child, B. Bs remainder
is vested subject to open, but it is not vested under the RAP until A dies and all of As children
are then in existence and identified. But because the remainder beneficiaries will all be
ascertained at As death, the remainder is valid.
i. RAP Danger Signs
i. The condition is not personal to someone
ii. There is an identified age or time period of more than 21 years
iii. An interest is given to the generation after the next generation (ie:
grandchildren)
iv. A conveyance requires that holder survive someone who is merely
described rather than names (e.g. the unborn widow)
v. An identified even that would normally happen well within 21 years, but
might not
vi. The holder wont be identified until the death of someone merely
described rather than named

47

j. Mechanics of the Rule

i. Fertile Octogenarian - It is assumed a person at any age can have a child.
ii. Unborn Widow
iii. Rule of Convenience the rule cuts off the possibility of new entrants to a
class at the earlier of two times:
1. The natural end when the possibility of births or adoptions ends
(with the death of the ancestor).
2. The premature or artificial closing of the class through the
operation of the rule of convenience. If the gift has been distributed
at certain time then the class is seen as closed, not open to future
child.
Example: O devises land to As children who survive to age 25 and at Os death, A is alive and
has three children, all of whom are younger than 25 and at least one of which is younger than 4.
The executory interest to As children is void. The invalidating chain of events is that A may have
another child after Os death and that after-born child reaches age 25 more than 21 years after A
and As three children who were alive at Os death have died.
Example: Same hypo; assume that at the time of Os death, A was alive and had three children,
the eldest of whom had reached the age of 25 by the time of Os death. Note first that no life
estate precedes the interest given to As children. Under the Rule of Convenience, because As
eldest child had reached 25 by the time of Os death the time of distribution the class closes
prematurely at Os death. The interest takes effect in possession at Os death. Any child born to
(or adopted by) A after Os death is excluded from the class, saving the class gift. The children
who were living at Os death and younger than 25 at that point constitute their own validating
lives. They are all lives in being, and either will or will not reach age 25 by the time she dies.
iv. HOW TO GET AROUND THE RULE: How can O still give land to A if
the (school) conveyee has violated a condition?
1. Give A FSA in the land, then in a separate document have A give
the land to conveyee then revert to A.
v. Nearly a of all states have law abolishing the RAP. Creating Perpetual
Trusts or use the wait and see approach
Example 19: O transfer a sum in trust for A for life then to As first child to reach 21. A is the
validating life. You can prove that any child of A who reaches 21 will necessarily reach 21 within
21 years of As death. The remainder must vest
Example 20: contingent; there is no validating life.
HYPO from facts of Example 20: A has a child has a child that is now 30. The childs interest is
vested; RAP doesnt apply. Who will take once A is dead? The childs heirs.
Example 21: T devises which means T is dead. Thus we will know that all of Ts kids are
now alive. If this was an intervivos transfer, how would the outcome be different?
You can only use those that are currently alive at the time of the transfer as a validating life.
48

When you calculate the validating life you want to hypothetically use the oldest living person.
If you asked for 22 years it would be invalid.
We have to wait for almost all of the grandchildren die?

Example 22: T devises a sum in trust for A for life, then to As children for the life of the
survivor of them, then upon the death of the last surviving child of A, to As grandchildren. At
the time of Ts death, A is an 80-year-old woman with two living children, B and C. The
remainder to As grandchildren is void. Ts Estate also has a reversion.
Problems on 218:
1) O conveys to A for life, then to B if B attains the age of 30. B is now 2 years old.
Answer: Valid; B is his own validating life; O has a reversion in fee simple, determinable,
subject to executory interest.
2) O conveys to A for life, then to As children for their live, then to B if B is then alive, and if B
is not then alive, to Bs heirs. Assume that A has no children at the time of conveyance.
Answer: Valid as to A; valid as to B; valid as to Bs heirs, too. Interesting quirk Bs heirs may
not actually take possession and this doesnt matter we only care about their legal right.
3) O, a teacher of property law, declares that she holds in trust $1,000 for all members of my
present property class who are admitted to the bar. Is the gift good?
Answer: This is a class gift; this is a valid gift; lives are in existence we have our entire life
plus 21 years to satisfy the condition and well know for certain whether we will or will not
satisfy the condition.
3) continued: Suppose that O had said, for the first child of A who is admitted to the bar.
Answer: Not valid.
4) O conveys to A for life, then to As children who reach 25. (type the rest here)
Answer: Example 24 bypasses A; so they can take now; here, the kids cant take now they
have to wait until A dies. So its not valid; only thing is to A for life, period. You cant close the
class out because the kids cant take distribution today and here they cant.
5) O conveys to A for life, then to As widow, if any, for life, then to As issue then living. Is the
gift to As issue valid?
Problem is that the widow is not named. Everyone named in deed may be dead so 21 year
clock is ticking. Now we have to wait until As widow dies then can look at his children, then
living. We may have to wait 50 years until As widow dies after A. There is a hanging question
here and the RAP is designed to fight this.
This is a double trick. The widow may not be alive and you have to find out who is then living.
If the Deed had named a specific woman shes a life in existence we would know at the end
of her life which children survive her.
HYPO:
to A for life then to his widow for life

49

6) a) T devised property to A for life, and on As death to As children for their lives, and upon
the death of A and As children, to B if A dies childless.
Answer: Is the last gift to B valid? Within 21 years of As death (at his death) we will know if he
died childless or with children we would know whether B takes the land or not. No hanging
question here.
b) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to B if A has no grandchildren then living.
Answer: A can still reproduce wed have to wait until their death and that will take longer
than 21 years so it violates the RAP. A would have to be the validating life here.
c) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Bs children.
Answer: Validating life can be B, doesnt have to be A. Well know exactly who takes after A
dies we can tell who the next generation will be after A dies, his children die it goes to Bs
children.
d) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Bs children then living.
Answer: A could have more kids, and they dont count as validating life; we dont know which
of Bs kids will survive As kids some may not be born yet and we wont know within 21
years of the last living person in existence. Not valid.
e) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to As grandchildren.
Answer: Invalid. Undefined class we wont know until potentially more than 21 years after the
last person has died. Its just too far-fetched.
f) T devised property to A for life, and on As death to As children for their lives, and upon the
death of A and As children, to Ts grandchildren.
Answer: We know whose Ts kids are, since hes dead. Ts kids are validating lives within 21
years of Ts kids dying, we will know who all the grandchildren are. This is valid. The trick is
you have to focus on the fact that T is dead if it was intervivos gift, it wouldnt work.
Its when you have two open classes (Ts children and Bs grandchildren, for example) that the
ability to find a valid clause is hard its just more far-fetched?

50

Future Interests and Transferors

Same result in Example 28 without violating RAP? Yes, you can 1) transfer the land in fee
simple absolute to A and have him transfer to School fee simple determinable possibility in
reverter will be in A, not in you; 2) transfer to school in fee simple determinable then sell your
reverter to A but only works in states that allow possibility of reverter to be sold (under
common law you cant do this).
Review Problems from Future Interests:
1. O conveys to A for life, then to B for life, then to Cs heirs. A, B, C and O are all alive at the
time of conveyance. C is unmarried and has two living children, X and Y.
Answer: A has a life estate; B has a vested remainder for life; and there is a contingent remainder
in fee simple absolute in Cs unascertained heirs. There is also a reversion in fee simple to O.
2. O conveys to A upon her first wedding anniversary. A is alive and unmarried at the time of
the conveyance. O is also then alive.
Answer: A has a springing executory interest in fee simple absolute; O has a fee simple subject to
an executory interest; immediately upon As first wedding anniversary, if it ever occurs, As
executory interest will divest Os fee simple and become possessory in fee simple absolute.
3. O conveys to A for 10 years, then to such of As children as attain age 21. At the time of the
conveyance, A and O were alive. A had two children, X and Y, ages 20 and 17, respectively.
Answer: A has a term of years followed by a contingent remainder in fee simple in which X and
Y have an interest. There is also a reversion in fee simple to O. The remainder is contingent
because it is subject to an unfulfilled condition precedent (attaining age 21).
4. Applying the same facts as in Problem 3, assume that X later attains age 21 and Y is still under
age 21. A and O are both still alive.
Answer: Xs attaining age 21 vests the contingent remainder in them, so that X now has a vested
remainder in fee simple subject to partial divestment by Y and also subject to partial divestment
because A is alive and may have more children some or all of whom may reach age 21. There is
no reversion (the vesting of Xs remainder simultaneously divests Os reversion). Y now has a
shifting executory interest in fee simple which will vest if Y reaches age 21.
5. Applying the same facts as in Problem 3, assume that X dies when X is age 22 and Y is age 19.
O is still alive.

51

Answer: Xs vested remainder is transmissible at death because it is not subject to any condition
that X survive to the time of possession. So it passes to Xs successors in interest (Xs devisees
under will or heirs); those persons take exactly the same interest that X had. Y still has a shifting
executory interest in fee simple. There is no reversion.
6. O conveys to A for life, then to As children. A and O are alive at the time of the conveyance.
A has one child, X.
Answer: A has a life estate; X has a vested remainder in fee simple subject to divestment; and
there is a shifting executory interest in fee simple in As unborn children; there is no reversion.
7. Applying the same facts as Problem 6, assume that A has another child, Y, and then A dies
survived by X, Y and O. Identify all of the estates and future interests existing as of As death.
Answer: The birth of Y vests the remainder in them and simultaneously partially divests Xs
remainder (reducing Xs share from 100 percent to 50 percent). Both Xs and Ys remainders are
subject to partial divestment so long as A is still alive and capable of having more children. Once
A dies, however, the class of As children closes and Xs and Ys interest become indefeasibly
vested in fee simple absolute. With As life estate terminated, X and Y take possession and own
the property in fee simple absolute as tenants in common (each has an undivided interest).
8. O conveys to A for life, then to B and her heirs; but if B marries Z, then to C and his heirs.
Answer: A has a life estate; B has a remainder in fee simple that is vested subject to complete
divestment; C has a shifting executory interest in fee simple absolute; there is no reversion.
9. O conveys Blackacre to A for life, then to B and her heirs so long as Blackacre is organically
farmed.
Answer: A has a life estate; B has a vested remainder in fee simple determinable; O has a
possibility of reverter in fee simple absolute.
10. O conveys a sum of money to A if she graduates from college. A is not yet enrolled in
college.
A has a springing executory interest in fee simple absolute; O has a fee simple subject to
executory interest. If and when A graduates from college, As executory interest will vest in
possession, divesting Os fee simple.
Other Examples of Remainders:
Example: O conveys to Hartford School Board, but if the premises are not used for school
purposes during the next 20 years, to Town Library. The School Board has a fee simple subject
to an executory interest that will automatically divest the Boards fee simple if the condition
happens.
Example: O conveys to Hartford School Board so long as the premises are used for school
purposes, then to Town Library. The School Board has a determinable fee. Town Library has an
executory interest.

52

Future Interests retained by the transferor (reversions, possibilities of reverter, and rights
of entry) are not subject to RAP. They are treated as vested as soon as they arise.
Example: O conveys Blackacre to the School Board so long as it is used for a school. The
School Board has a fee simple determinable; O has a possibility of reverter exempt from RAP.
Example: O conveys Blackacre to the School Board, but if it ceases to use Blackacre for school
purposes, O has a right to re-enter. The School Board has a fee simple subject to condition
subsequent; O has a right of entry exempt from RAP.
Future Interests in transferees:
Example: O conveys Blackacre to the School Board so long as it is used for a school, then to A
and her heirs. As executory interest violates the RAP. It will not necessarily vest within As
lifetime or within 21 years after As death. It may vest and become possessory centuries from
now. When an interest violates RAP, it is struck out and the remaining valid interests stand. Take
a pencil and line out the void gift, then to A and her heirs. This leaves a fee simple
determinable in the School Board. Since O has not given away Os entire interest, O has a
possibility of reverter.
Example: O conveys Blackacre to the School Board, but if it ceases to use Blackacre for school
purposes to A and her heirs. The School Board has a fee simple subject to (an apparent)
executory interest. As executory interest violates RAP as It will not necessarily vest within As
lifetime or within 21 years after As death. It may vest and become possessory centuries from
now. Strike it out, beginning with but if it ceases This leaves standing a conveyance To the
School Board. The School Board now has a fee simple absolute!!

53

Co-Ownership
Summary of Co-ownership:
1) Multiple people can own the same property together.
2) There are at least three ways of owning property together: a) tenancy in common; b) joint
tenancy; and c) tenancy by the entirety.
3) In each of those situations each co-owner owns an indivisible share of the whole. Each coowner gets the use of the entire property. They each own the entirety of the property.
4) Tenancy in Common is the default co-ownership interest. Unlike the other two, the shares in
TIC need not be identical. They can be TIC 60% and 40% for example. An interest of each coowner can be bought, sold, transferred, without notice, to another co-owner. You dont need
consent or permission or even tell them.
5) Joint Tenancy is just like TIC but has a right of survivorship and requires that each co-tenant
have an equal share in the property (So you cant have 60% and 40% - must be equal with each
other. Because of these extra features, has special rules to come into being the Four Unities:
Time; Title; Interest and Possession.
6) Right of Survivorship that comes with JT upon the death of any co-owner, the other coowners immediately take the deceased co-owners share. JT cannot be devised, because at the
time of death there is nothing to devise. Upon the last breath, whatever you used to own goes to
your co-owner.
7) Interest in Joint Tenancy can be sold without consent of the co-owners just like TIC you
just cant devise it. And if you do this such a transfer of ownership breaks the unities the new
guy comes onto the land by different title and different time and therefore makes the newcomer
not a JT but a Tenant in Common. Doing so also destroys Right of Survivorship since that
requires the unities.
8) Tenancy by the Entirety is simply a special kind of Joint Tenancy that is available to only
married couples. Just like JT same requirements except the additional unity of Marriage at
the time of the deed.
9) Unlike JT, TBE cannot be unilaterally be broken. However, has the other qualities of JT

a.

Common Law Concurrent Interests

i.

b.

Both parties have concurrent interest not absolute rights. Concurrent

ownership helps economic development. It also creates many problems.
Usually the number of people holding the land is small so they come to
some sort of agreement. The rules are written so one tenant cannot hurt the
rights of the other tenants.
Tenants in Common have separate but undivided interests in the property. Each
tenant has right to all of the property. Even if it divided unevenly, both parties
have equal access to the land. Interests are separate. If one tenant dies, the
percentage interest is passed on in a will and does not go to the other party, unless
they are an heir.
54

c.

i. Tenancy in Common: Most basic type of co-ownership. Each tenant

(owner) has a separate but undivided interest in the property. Each tenant
has access to the entire property you each own it as a whole. Not a
percentage ownership. They both own everything together. There is no
survivorship clause. Once one tenant in common dies, the second tenant in
common gets nothing from the deceased. The deceased can pass his land
to his family, heirs, devisees. The death of any co-tenants does not impact
the share of the other co-tenant. Each co-tenant can freely sell their
interest its freely alienable. The person who you transfer it to steps
into your shoes and then they are a tenant in common with the remaining
tenant. This is our presumptive interest if the deed is not clear this is
the interest that they say was created.
Joint Tenants unlike tenants in common, have the right of survivorship.
Upon the death of one, the other tenant automatically takes full interest in the
land. The interest cannot pass the land to another by will, but can during the
tenants life, en vivo. Joint Tenants do not have to related or named as an heir.
i. Joint Tenancy: Particularly unique features has additional requirements.
Specifically the right of survivorship. Once a joint owner dies, the other
joint owner automatically succeeds to the interest automatically and
immediately. As soon as A dies, it all becomes Bs. B steps into As shoes
immediately. By definition, you cannot past this interest by Will, because
by the time you read the Will, there is nothing to pass its already owned
by the other joint tenant. Why would you want to do this? It avoids
probate. It can be passed, sold, mortgaged intervivos. A can sell their
interest to someone else. * interesting things happen once this occurs!
ii. Special hoops to create the joint tenancy: Four Unities:
1. Time the interest of each joint tenant must be acquired or vest at
the same time
2. Title All joint tenants must acquire title by the same document or
by a joint adverse possession. A joint tenancy can never arise by
intestate succession or other act of law.
3. Interest All must have equal undivided shares and identical
interests measured by duration.
4. Possession Each must have a right to possession of the whole.
After a joint tenancy is created, however, one joint tenant can
voluntarily give exclusive possession to the other joint tenant.
iii. Joint tenants need The Four Unities:

1.
2.

Time acquired or vest at the same time

Title title must be acquired by the same instrument, can never
arise by intestate by duration

55

3.

d.

Interest equal undivided shares and identical interests, exactly

even.
4. Possession each must have the right to possession the whole. Not
just a part.
5. (Married Only for Tenancy By Entirety, specialized form of
Joint Tenancy).
6. HYPO: A & B (Joint Tenants); B sells his interest to C. Now A &
C. They are joint tenants as Tenants in Common. The unities are
now broken.
7. HYPO: A, B & C (Joint Tenants); C sells to D. A & B are (Joint
Tenants) and D is Tenant in Common. If B dies, A gets Bs interest
automatically upon Bs death. A is then 2/3 and D ends up with
1/3.
iv. Otherwise according to common law, a tenant in common has been
created. A tenant can unilaterally convert his tenancy to an in common by
transferring his interest to a third party. The right of survivorship is
destroyed by unilateral actions, as soon as any of the Four Unities is
broken.
Tenancy by the Entirety - Its just like Joint Tenancy except is available only
to married couples. Same unities apply plus the unity of marriage. Marriage
must have existed upon the execution of the deed. You cant sell your interest
without permission of the other party. Divorce or consent are the only ways to
break this type of deed.
i. A Tenancy by the entirety can only be created in husband and wife. Must
be married at the time of the conveyance. One tenant cannot pass their
interest to anyone else without the consent of the other spouse. No
doctrine of severance while husband and wife are still alive and married.
ii. Courts today favor tenants in common over joint tenants.

iii.

Avoidance of probate

1.

iv.

Probate is the judicial supervision of the administration of the

decedents property that passes to others at the decedents death,
very costly. Joint tenancies avoid probate because no interest
passes to the tenants death. An interest in Joint tenancies cannot be
passed in a will. Creditors cannot act after the Joint tenant is dead,
only while alive. However this rule against creditors does not
apply to the federal estate tax.
Unequal Shares

1.

At common law both tenants had to own equal shares, if not they
were tenants in common. Today courts mostly ignore this rule.
56

2.
3.

A joint tenant can always sever the joint tenancy unilaterally.

If joint tenants die at the same time, the court divides the value
50/50 among the heirs of both.
a. Harms v. Sprague (1984) (p. 330)

i.
ii.
iii.
iv.

v.

vi.

vii.

viii.
ix.

x.

xi.

A mortgage in one tenants name only on a property

does not sever the joint tenancy.
In most states mortgages do not survive upon
death?
Bank forgot to make sure that the other co-tenant
signed
Brief Fact Summary. Surviving joint tenant brought
action to determine title and ownership of
survivorship property against mortgage holder and
executor of decedents estate.
Synopsis of Rule of Law. A mortgage on the joint
tenancy property was not a lien after the death of
the joint tenant and did not sever the four unities of
joint tenancy, thus the surviving tenant became the
sole owner of the property.
Issue. Does a mortgage note: (1) sever the joint
tenancy when less than all joint tenants mortgage
their interest in the property? (2) Does this
mortgage survive the death of the mortgagor (John)
as a lien on the property?
Held. No, the property remains a joint tenancy
property because the four unities are not severed
and the mortgage does not survive the death of the
mortgagor and become a lien on the property.
Affirmed.
The four unities (time, title, possession and interest)
if severed, destroy a joint tenancy.
A mortgage does not transfer title, because the unity
of title is preserved, title is not transferred, the joint
tenancy is not destroyed by the mortgage.
The property right of a joint tenant is extinguished
upon death, which activates the right of
survivorship and allows the surviving joint tenant to
become the sole owner of the property.
Because the mortgage was not recorded as a lien on
the property, it ceased to exist because when the

57

v.

mortgaging joint tenant died, his property interest

which the mortgage attached ceased to exist.
Multiple-party Bank Accounts .

1.

The amount of the distributed is equal to the amount each put in, at
death the survivor gets all of the money. Different from joint
tenancy.

Relations Among Concurrent Owners

2.

Delfino v. Vealencis (1980) (p. 338)

a.

b.

c.
d.

e.

f.

g.

The court can order partition of the property, weighing

what is in best interest of all parties, taking into account
factors such as economic interest and actual possession vs.
just holding title.
Trial judge says that the best use of the land is to develop
the land compared to the junk yard business. Defendants
business will interfere with the best use of the land.
Must look at the interest of the parties both of them. Not
up to the trial judge to figure out the best use of the land.
Unfortunate history with partition by sale in the South
African Americans dying intestate and are vulnerable to
partition sales. This has worked to the disadvantage of the
AA families. Another reason this is disfavored it
generally is a disadvantage to those who are poorer and
racial minorities.
Partition by kind physically divide the land so everyone
gets a share equal to their share, taking into account value,
access to roads, view. Once division happens the other
tenants cannot go on the others land, trespass. Courts prefer
this option because land is unique.
Partition by sale land sold at auction and the money is
divided up according share, now a third party owns the
land. Courts dont like to do this.
What about property that cant be sold or divided Real
case a rocking chair which both brothers wanted, the
court ordered a division by time. Each would have it for 6
months.

58

HYPO: Two brothers inherit a fathers rocking chair. Selling it isnt an option its not worth
anything. Partition in kind isnt an option either. They made an agreement each had it for 6
months then it went to the other and back and forth, per the court ordered agreement.
HYPO: Expensive violin/painting same issue expensive to move back and forth court has
to come up with creative solutions.
vi. Sharing the Benefits and Burdens of Co-ownership

1.

Spiller v. Mackereth (1976) (p. 348)

a.

vii.

The courts will not make the owner of property pay rent on
something they already own. Except for ouster, like locking
the other tenant out or being denied access to the property.
b. In order to be denied, the tenant must first try to enter to
prove ouster. OR if one tenant transferred the entire interest
to a third party.
c. Court wants to promote the use of the land, one party is
using the land and other is sitting on his interest. If the
other tenant wants money out of the property, then he
should rent out the land himself.
d. Absent agreement to pay rent; or complete ouster of a cotenant; the tenant in common is not liable to pay rent for
their use of the property because they own the whole of
the property.
e. What is ouster? The essence of the finding of an ouster in
the adverse possession cases is a claim of absolute
ownership and a denial of the cotenancy relationship by the
occupying tenant. Ouster is showed by fact similar to
adverse possession.
f. Could they have won via adverse possession? Because the
Ps interest lapsed through Ds adverse possession? Why
not? The Rule is possession by one is possession by all.
Neither co-tenant has the ability to eject the other co-tenant.
I guess because they are on equal footing?
g. Imagine a locker shared space rather than a residence,
which seems more intuitively private.
2. What if the property is incapable of being shared between the two
tenants (too small)? Partisan in time OR Partisan by sale.
Swartzbaugh v. Sampson (1936) (p. 351)

1.

Where one tenant leases common property to a third party, the

other tenants in common cannot cancel the lease or recover
exclusive possession of the entire property.

59

2.

viii.
ix.
x.

If you dont want to allow a joint tenant to lease part of the land
the other joint tenant could ask the court for partition, or demand a
share of the rent.
3. If the leasor died before the end of lease, then the joint tenant
would own the land in total. And the leasee will have to renegotiate the lease.
In joint and common all share the taxes and other cost according to the
percentage share
However, one tenant cannot seek sharing of costs for improvements but
that tenant gets more money when the property is sold or subdivided in
proportion to the improvement increased the value of the property.
Remedies available for a joint tenant

1.
2.
3.

Partition
Ouster
Accounting - suing to get a portion of the rents

Marital Interests
a.

The Common Law Marital Property System

b. How did this come to be? H&W didnt have separate property considered a
single unit. Ws property came under the H. In exchange, the H was required to
extend protection and support for the W. Thus, all of Ws property is under both
individuals but only H has the right to dispose of the property. W could not
dispose without Hs consent even her old property. Right around the 14th
Amendment States started passing Married Womens Property Act which
removed the disability from women so they came to be treated like men could
sell/dispose of their own property.
i. During Marriage

1.

ii.

Only the husband could sell or transfer the land. A women ceased
to be a legal person for the duration of marriage, all property
become the husbands. Most states passed the Married Womans
Property Act removed the disability. Joint Tenancy can be broken
by conveying the property to another or yourself. This cannot be
done in Tenancy by the Entirety.
Sawada v. Endo (1977) (p. 361)

60

c.

iii. Argument from D: Its not fraudulent since the house was unattachable
in the beginning. The house is owned by the unity of husband and wife
not attachable to husbands creditors.
iv. Four Categories: 1) H&W own property by the entirety but only H can
convey the property; H cannot convey the property but can be attached by
his creditor
v. This case falls under Class III An attempted conveyance by either spouse
is wholly void and the estate may not be subjected by the separate debts of
one spouse only. The reason is because spouses are joined as owners into
one estate one single spousal unit.
vi. Thus, the injured party here could not reach the property interest anyway
because the H has no separate interest in the property its not half to H
and half to W its an entire whole interest to both H&W.
vii. Creditors can check land records to confirm titling and should have both
spouses sign off on loans if they dont, thats their own fault, per the
court.
viii. Fundamental point unlike joint tenancy tenancy by entirety cannot be
destroyed by the unilateral action of just one party. The interest of neither
party is alienable without the consent of the other. There is one exception:
The IRS can DEATH, TAXES AND DIVORCE can destroy the tenancy
by the entirety.
ix. Policy Questions: Is tenancy by the entirety discriminatory? Is it generally
a good thing?
x. His view is that marriage may not be worthy of incentivizing. Could be a
good policy question
xi. Maybe T&E should be abolished for everyone some get a benefit that
maybe should be shared by more people? Broader or more narrow?
Maybe.
xii. If wife dies and husband remarries soon after, can the creditors take the
land? Yes, the creditors could take the land because the Tenancy by the
Entirety has been destroyed.
xiii. If you want to create a joint tenancy, need to say the magic words in
joint tenants, with rights of survivorship or tenants by the entireties etc.
xiv. Public Policy: The court looks at the family home as the greatest and
probably only asset, if the home is taken that hurts the family unit. The
policy gives creditors an opportunity to research the couple before they
lend the money. Creditors make both spouses sign the loan.
xv. Now all states have given equal rights to husband and wife in a tenancy by
the entirety. The rule does not apply to debts owed to the IRS or if the
property is used for illegal drug activity.
Termination of Marriage by Divorce

61

i.

After the divorce the unity of marriage was served, becoming a tenancy in
common. With the no-fault divorce property is divided equally.

LEASEHOLDS
LOOK AT EXAMPLES FROM PAGE 275, 276 & 277
a. The Leasehold Estate
b. You have a continuing relationship with the landlord during a leasehold estate.
i. The Term of Years

1.

ii.

The term of year is set before, no notice of termination is necessary

to bring the estate to an end. Definitive length written in the lease.
2. It has a definitive length even two days, decade, month, etc. The
way you know it is this type it has a definitive length.
3. HYPO: Why is this not a problem for RAP purposes? Because its
a present (vested) interest not a future interest. So RAP doesnt
apply.
4. HYPO: What if it was to A for 1,000 years then to B? Does this
violate RAP? No also vested so RAP doesnt apply.
5. The length of term must be FIXED here and they flow from this
notion. Thus, there is no need for notice that a party is terminating.
Obviously in todays day and age, you may want to give notice
but traditionally, if your lease runs out on a certain date, you
simply leave on that date.
6. The death of either tenant or landlord has no effect on the life of
the lease. Somebody steps in the shoes of one or the other. There is
one exception: if the lessor had a life estate as the life estate ends
at the lessors death.
7. HYPO: If you have a lease with Bob and then Bob dies, who is the
new landlord? Bobs heirs or his devisees. If you die, your heirs
will pay the landlord.
The Periodic Tenancy

1.

A lease that continues for a fixed duration. Year to year or

Month to month. Year to year lease must terminated with a 6
month notice and nothing more than 6 months.
2. Must vacate the day the lease would end. To A from month to
month.
3. The death of a land lord or tenant has no effect on the either
term of years or periodic tenancy, unless it is a joint tenancy. The
landlords heirs keep the estate but lease remains and same for if
the leasee dies, his heirs keep the lease till the end.

62

4. It goes from period to period; similar to term of years but doesnt

expire automatically. It keeps renewing and never expires until
notice is given.
5. How to create: From months to months or from year to year or
from day to day or created by implication.
6. To break: notice must be given. So when must notice be given? It
must be given for the period equal to the period of the weeks. If its
month to month then a month notice. If day to day, then at least a
day in advance.
7. Rule: At least a period of the lease, but never more than 6 months
(whichever is shorter). You must give notice on the last day of the
relevant period (thats when it becomes effective).
8. Look at this easy exam question calculation of when you give
notice, when it becomes effective and when you can move out.
iii. The Tenancy at Will
1. Has no fixed end point and endures so long as both landlord and
tenant desire. Some notice may be required. If the document was at
the will of one party than it was also at will of another party. Ends
at the death of either the landlord or tenant. SoF applies if over one
year.
2. Its at will, indeterminate length but can be terminated by either
party (like employment at will).
3. Common Law: This is a two way street. You cant create one-way
tenancy at will.
4. As soon as one party dies, the tenancy ends. After all, you only
have will when you are alive!
5. Now courts try to ascertain the intentions of the parties to see what
type of tenancy was supposed to be created.
iv. Kajo Church Square v. Walker Case
1. Tenancy at Will lease created here. This impacts the value of the
land its not something that be fully controlled like a fee simple
absolute.
2. This wasnt a life estate because there was no language in the deed
of record evidencing the alleged life estate interest in the property.
3. Tenancy at Will either party can terminate the tenancy.
4. *NOTE: Minority View as to why: Why do we think, faced with
these circumstances does NY say that its a lease for life instead of
a life estate? Why did they choose this? (We should be able to
answer this at end of today or by next week).
5. rule: no such thing as a tenancy for life; when this is an attempted
creation, it's actually a tenancy at will.
6. - P gets burned here: tried to give a church a fee simple for tax
deduction, where the church was to give the P a lease for life.
63

Church sells after 30 day notice, court says that's proper under
"tenancy at will."
v. Tenancy at sufferance (Quasi-Tenancy) (Not really a Leasehold, separates
Tenants from Trespassers)
1. When a tenant over stays the lease. The landlord can choose to
allow the tenant to remain or evict. At common law remaining
allowed the landlord to holdover the tenant for another year, but
limit to one another year only. Subject to the same terms of the
original lease. The landlord has two options: eviction or consent
for creation of tenancy.
2. Some states have changed the law to allow for the landlord to
convert the lease to month to month or charge double rent. Or the
tenant will have to pay fair market value, which may lower the
rent. With transaction costs both parties might come out on top.
3. Fourth Type (Quasi-Tenancy): Tenancy at Sufferance (Type of
Situation that results when a Tenant remains in possession after
termination of the tenancy. The tenant is over-staying their
welcome and the landlord is allowing it. Theres no document for
this so not a real tenancy. Generally cant be a periodic lease
since it automatically renews.
4. At common law, stay over allowed the landlord to renew the lease
for a year.
5. Sometimes the length of the term can be hard to pinpoint. States
need to determine this for when someone overstays their length
and how the landlords are able to respond (automatically renew for
a month or a year?)
6. If the landlord does a holdover the rest of the clauses in your
lease are still the same same obligations on both sides its like a
renewal.
7. Some areas are different in Baltimore, landlord can charge
double rent for holdover.
8. Landlord is getting what they agreed to get anyway so its only
fair they dont have to advertise, etc.
Problems on Page 266:
1(a): One October 1, L leases Whiteacre to T for one year, beginning October 1. On the
following September 30, T moves out without giving L any notice. What are Ls rights? L has no
rights this was a periodic tenancy T is able to move out without notice since he was at the end
of the tenancy. If T had stayed one more day L couldve had holdover maybe.
What if the lease had been for no fixed term at an annual rental of 24k payable 2k per month on
the first of the month? This is a periodic tenancy.

64

2. T, a month-to-month tenant, notified L on November 16, 2010, that she would vacate as of
November 30, 2010. T subsequently vacated on that date and paid no further rent to L. L, after
reasonable efforts, finally relet the premises beginning April 1, 2011. The jurisdiction in question
has no statute prescribing the method of terminating a month-to-month tenancy. L sues T for
unpaid rent for the months of December 2010 and January through March 2011. What result?
Notice was given, but its not effective until November 30th and one more period so lessor owes
December rent, but not January through March. Once the tenants obligation ceases, the rest of
the problems are the landlords own problems.

The Lease
vi. A lease is both a contract and a conveyance. Statute of Frauds applies.
Most leases are contracts of adhesion; courts accept this but look for
evidence of unequal bargaining power.
vii. A lease is a document that creates a leasehold estate. A Billboard is not a
lease because the land is not modified but leasing land to put up a
billboard is a lease. Depends on possession and control by the landlord.
More control by tenant more likely it is lease. More control by the
landlord than a license has been created. Hotel room (license), apartment
(lease).
viii. Under traditional property rules convents are not mutual, could not break a
promise if the other side broke the promise first. Different from contract.
That is why a lease is both a contract and a conveyance.
ix. Terminology is important in the title of the document and the actual words
themselves.
x. Billboard is typically not a lease but are instead an easement or a license.
This is because the use of the billboard does not really interfere with the
grantors right of possession. On the other hand, you can actually rent a
small strip of land with two poles and since you are leasing a land this
can be a lease.
xi. A lot turns on the amount of possession and control retained by the
landlord. The more control given to the lessee the more likely it is to be a
lease rather than a license. IN a typical apartment, the tenant has more
control.
xii. The more services provided, the less likely its a lease. Hotels = license.
Fancier the hotel the more likely its a license since they provided more
services.
xiii. Fine line really nice apartments are still leases but seem to have
qualities of licenses.
xiv. Is a lease a conveyance or a contract? BOTH!
xv. Courts today commonly rely on contract principles to reshape the law of
leases with these questions: 1) Are the covenants in leases mutually

65

dependent, such that (as in contract doctrine) a material breach by one

party excuses further performance by the other party, even if the lease
does not so provide? 2) If the tenant wrongfully abandons the leased
premises, must the landlord take steps to mitigate (reduce) the damages,
say by searching for a suitable new tenant? 3) Is a warranty of quality
that the leased premises are habitable or fit for their purpose to be
implied in leases?
xvi. As a new tenant, when you sign a lease, you expect the apartment to be
delivered to you. The landlord covenants to deliver you the apartment.
In England, they promise to put you in actual physical possession
(Apartment should be empty). In America, they promise to put you in legal
possession (apartment MIGHT be empty). Landlord only breaks the duty
to deliver if they give you a lease that overlaps with someone elses lease.
If it doesnt, the landlord has performed their duty.
xvii. Landlord is not required to guard your premises against future trespassing
by other parties. So once you are put into possession and someone else
shows up and squats on your premises thats not the landlords problem
as far as duty to deliver thats your problem. Remember YOU are in
control so YOU are responsible. Lock the doors get a dog.
c. Selections of Tenants FOR EXAM: We want to know in a general sense what
are protected categories and get blatant terms.
i. Discriminatory selection of tenants is prohibited. Federal Fair Housing Act
(FHA) prohibits discriminating tenants based on race, color, religion, sex,
familial status, or national origin. Not covered: sexual orientation,
occupation, income, criminal background, political beliefs, and
association.
ii. Small landlords are excluded from FHA. Even then small landlords are
excluded from advertising their discrimination. Must make reasonable
accommodations for the handicap.
iii. Newspapers are liable but the internet companies are not liable for
publishing discriminating lease ads.
iv. Do we need the FHA? Yes due to a long history of discrimination,
discrimination is inefficient and property law is to promote efficiency. The
market will not always correct itself.
v. Discrimination is generally prohibited but where does this come from?
Federal Fair Housing Act is the floor and some jurisdictions may have
broader protections. We are only being tested on the FHA.
vi. Fair Housing Act: cant discriminate based on race, color, religion, sex,
familial status, and national origin.
vii. Lots of things not included: sexual orientation; political parties;
occupations, etc.

66

viii. This doesnt apply when you are renting your own home or are a small
landlord renting rooms in your own home then you can discriminate as
much as you want. Small landlords are exempt.
ix. Either Small or Large landlords are prohibited from advertising that they
are discriminating.
x. Is the prohibition on discriminatory language actually useful? Its still
legal to refuse someone in person you just cant advertise it is this a
good thing since its wastes peoples time?
xi. Notes: You cannot discriminate on the basis of children; but you can
discriminate on the basis of family size. Well talk about this with zoning,
too, if we get to zoning.
xii. What about discriminating on the basis of behavior? Too many whores? Is
this legit or based on family status? Hard to figure out gray area.
xiii. Page 275 newspaper publishers association list of taboo words for real
estate advertisements.
xiv. Ok to say: near bus lines, credit check required, no drugs or drinking, refer
to school districts, senior discount and presence of a nursery.
xv. Caution is advised: Fishermans retreat, no gays, no lesbians, handymans
dream, prestigious, nannys room, quality neighborhood, and secure.
xvi. Unacceptable terms: able-bodied, bachelor, near churches, couples only,
empty nesters, exclusive, executive, responsible, and no smokers. Cant
say no alcoholics either.
xvii. No smokers/no alcoholics looked at as a disability so its prohibited?
Maybe? Could argue.
xviii. Some of these words are code words so they can signify certain
meanings.
d. Tenants Right of Possession:
i. Hannan v. Dusch (1930) (p. 438)
1. English Rule: The landlord has the duty to deliver actual
possession. So if there is a holdover, the landlord can be sued by
the tenant. The English rule protects unsophisticated tenant which
most people are. Not fair to make the tenant pay for litigation
against another tenant. Half of the US courts follow this rule.
(English Rule) If you are a risk adverse landlord you wouldnt
rent out the unit until the prior tenant has vacated. This way you
dont worry about holdover tenants.
2. American Rule: the landlord only has duty to deliver legal
possession, not actual possession. The landlord had nothing to do
with the wrongful act and not should be held responsible for the
actions of another. Half of the courts follow this rule. (American
Rule) Other option you sue the holdover tenant hes trespassing
on property you have a legal right to possess.

67

Subleases and Assignments

ii. Assignment - If the leasee transfers the entire remainder of his term.
iii. Sublease - If the leasee transfers less than the full term.
1. Ernst v. Conditt (1964) (p. 442) - Just because the agreement was
called a sublease does not mean that it was one, the language does
not matter. In an Assignment the assignment-tenant is liable for the
rent, while in a sublease the original tenant is.
2. Plaintiff gives to Rogers who gives to the Defendant.
3. Defendant starts paying Plaintiff directly then later stops paying
his rent. P wants his money.
4. If this were a true sub-lease, Defendants responsibility to pay rent
to the plaintiff doesnt exist. If this were a true sub-lease, the
Defendant would win hes only liable to Rogers (his lessor).
5. Goes back to privity? Is the true owner in privity with the second
lessee? NOPE! There is no legal relationship as far as contract law
is concerned.
6. Privity of Contract asks: Who did you sign with?
7. Privity of Estate asks: Is the Estate held by current tenant = Estate
given by landlord to original tenant. Basically, ask who gets land
back at expiration of current lease? If the landlord, they are in
privity of Estate. Privity of Estate means that the Estate that this
person has is the exact same estate that the other person has. Once
the second lessees term goes out it goes back to the initial
landlord and not to an intermediary.
8. How is sublease defined? A sublease is an estate of smaller
quantum than what the initial tenant got. Ex. I got 3 years, Ill give
you 2 years. I got 5 days, Ill give you 2 days. A sublease is when
the current tenant got less than what the preceeding tenant had.
9. If Assignment = the current tenant got exactly what the preceeding
tenant had.
10. If an Assignment, the Plaintiff can go after either party he has
privity of contract with the first tenant and privity of estate with the
second tenant.
11. The Court says Roberts is a surety if you co-sign your friends
loan they can still go after the initial person, too.
12. Example: Landlord -> T1 for 2 years (lease) -> T1 to T2 for 1 year
(sublease) -> T2 to T3 for 1 year (assignment (When you give
someone everything you have?) -> T3 to T4 for 6 months (six
months).
13. Just because you see an assignment some where doesnt mean
you can jump right over to the original landlord. Very easy to get
trapped/trick!
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14. Partial Assignment is not just a sublease. It means you assign

fully (for the full period) only a portion of your land. Two different
apartments that you own. You sign a lease for both apartments
they are treated by your landlord as one but you can partially
assign your interest in one of the apartments.
15. Sublessees ring is attached to the lessees ring if the lessee is
gone the sublessee has nothing to hold onto the original landlord.
16. Assignee is privity of estate with the landlord but not privity of
contract because the assignee will sign a contract with the leasee.
Subleasee has neither privity of contract or privity of estate. The
landlord cannot go after the subleasee for non-payment, the
landlord will have to go after the leasee.
17. If leasee dies, the lease goes to the leasees heir and the sublease
would continue.
18. Partial assignment giving some of the land, is not a sublease.
19. Surrender or forfeit a lease forfeit ends the sublease, surrender
the sublease remains. The subleasee steps up to as a leasee.
20. Brief Fact Summary. The Complainants, Mr. and Mrs. Ernst
(Complaintants), approved a modification to a lease that allowed
the Defendant, Conditt (Defendant), to sublease the premises and
left the lessee personally liable. Defendant ceased paying rent and
Complainants sued to determine whether the instrument was a
sublease or assignment.
21. Synopsis of Rule of Law. The words used in an instrument are not
conclusive, rather it is the intentions of the parties that govern
whether the instrument is a sublease or assignment.
22. Issue. Whether the lease and modifications to the lease created a
sublease or assignment.
23. Held. Affirmed, the use of the word sublet is not conclusive of
the construction to use on the instrument. Rather the instrument
was an assignment.
24. A sublease grants the sublessee an interest in the lease premises
with a reversionary interest remaining with the lessee. An
assignment conveys the whole term, leaving no interest or
reversionary interest in the lessee.
25. The Common law rule is if the instrument purports to transfer the
lessees estate for the entire remainder of his term, it is an
assignment, regardless of its form or the parties intentions.
26. This current agreement, despite its terms, does not leave the lessee
with a right to re-enter or a reversionary interest, thus it is an
assignment.

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27. Discussion. The court ruled that no matter what rule the court used
to analyze this case (modern or common law), the result was the
same. Because the sublease agreement left the lessee with no rights
either express or implied, the intention of the parties was an
assignment and not a sublease.

HYPO: If you lease an apartment and you give hot water and the other gives 1k and you stop
giving them hot water the obligation of 1k is not dependent on the covenant. You can sue for
the enforcement of the covenant but they are not mutually dependent.
HYPO: You sign a lease, you show up at leased premises and someone is there. What do you do?
Can you sue the landlord and the holdover tenant?
Problem #4: Page 274: Mrs. Murphy has an apartment to rent in her home. She puts the
following ad up: For rent: furnished basement apartment in private white home. Call bitch. An
African American couple applies and is rejected by Mrs. Murphy because of race. Are there any
violations here? a) Implication is obvious that its a white home and she wants to keep it that
way and she can reject their application but she cant advertise in a discriminatory fashion.
Problems on Page 284
4(a): 1. Can L go after T? Yes, landlord can always go after initial tenant they have privity of
contract.
Can L go after T1? No, its a sublease. They are not in privity of estate and they arent in privity
of contract.
Can L do anything to T1? Yes, he can evict him gets no money but can kick him out. Why? Its
an equitable remedy.
4(b): 1. L sues T for rent due. Yes, you can always go after the initial tenant always!
2. Can L sue T1? Yes, because its the same case.
4(c): 1. L, T, T1 (entire interest & assumption of covenants), T2 (entire interest) , T3 (entire
interest)
L can always sue T.
L cannot proceed against T2 no privity of estate and contract but T2 gave his entire interest
away.
Once you assign an interest, you are out of the picture the interest is gone and the person you
assigned it to now has stepped into your shoes
L can sue T3 based on privity of estate (as T3 holds the entire of what is left in the Estate)
Because T1 expressly assumed the covenants by doing so, he becomes in privity of contract
with L.
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Thus, L can sue T, T1 and T3 but cannot sue T2.

T1 can sue T2 especially if he gets sued by L.

Consent in Subleases & Assignments

Language is important not necessarily the heading but within the document itself. It matters
what you actually transfer in the document not what you call things (Sub-lease when its really
an assignment, etc.)
xvi. Kendall v. Ernest Pestana, Inc. (1985) (p. 450)
30. The majority of jurisdictions hold that a leasor may arbitrarily
refuse to approve the assignee.
31. Under the minority rule the leasor must have a good reason to deny
the assignee. Not consenting violates restraints on alienation and
implied contractual good faith
32. Because judges do not like alienation the leasor is given the
narrowest construction possible in the lease, for a refusal clause.
33. The traditional rule relies on the theory that a lease is conveyance,
while today leases are seen as the opportunity to make money and
a refusal effects profit. Need some valid commercial reason for
denial. Some states only apply the minority rule in commercial
property.
34. The reasonableness is a matter of fact for the jury; judges can
decide clear reasons for denial from going to the jury.
35. All subleases and assignments must be approved
36. You cannot unreasonably withhold your consent
37. As a general matter, law favors free alienability of property. The
more property is alienable, the better it is. This is why we have
RAP!
38. Any restraints on alienability and blanket ability to veto any
transfer is a restraint but they must be narrowly construed and
they are strictly construed against the lessor
39. The court also recognized the traditional majority property rule
unless the lease provides otherwise the lessor may arbitrarily
refuse to approve a proposed assignee no matter how suitable the
assignee appears to be and no matter how unreasonable the lessors
objection
40. The court also reviewed the minority property rule where a lease
provides for assignment only with the prior consent of the lessor,
such consent may be withheld only where the lessor has a

71

commercially reasonable objection to the assignment, even in the

absence of a provision in the lease stating that consent to
assignment will not be unreasonably withheld.
41. From now on, leases should not be viewed as mere conveyances
between lessee and lessor. They should also be looked at as
contracts. You are still protection you can still refuse consent, on
good grounds. You dont have to consent to everything
42. In this contract, the landlord wouldve given permission = but only
if he could raise the rent. He could make more money!
43. The Court says theres no reason why the landlord should realize
any increase value in the rental land why? That doesnt sound
right! Because its not what he bargained for originally. He doesnt
get to extract more than what he bargained for.
44. Bottom line in commercial leases, even if there is a clause that
says no sublease shall be granted without consent the majority
rule, including in MD that consent cannot be unreasonably
withheld.
xvii. Can a tenant refuse to rent to an abortion provider (or other moral
objection)?
45. Yes, cant force a landlord to rent against a moral objection.

The Tenant Who Defaults

xviii. Berg v. Wiley (1978) (p. 460)
46. Under common law a landlord is not liable for wrongful eviction if
al. The landlord is legally entitled to possession, i.e. the tenant
breaches the lease (but without the courts landlord cannot
know for certain, so landlord is at his own risk)
am.The landlords reentry is peaceful (No physical violence; at
common law the courts were all the way in London difficultly for quick justice).
an. Starting with Berg v. Wiley landlords limits to using selfhelp to evict. P is tenant, D is landlord. P is running a
restaurant violating health codes, violating lease provisions
re: reparations and construction. D has right of reentry,
gives 2 weeks to fix it. On the last day, P dismisses staff,

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closes for remodeling. D reenters, everyone calls the

sheriff, landlord changes the locks the next day. P sues for
wrongful eviction, arguing lease not violated, and even it
was, eviction was unlawful. CL said self-help was
appropriate where:
ao. Landlord legally entitle to possession
ap. Means used to effect eviction are peaceable
aq. Ct ultimately holds that under the old common law rule the
self-help here was not peaceable, s/not have changed the
locks. Then the court goes further to say that self-help is
never peaceable. Why?
ar. b/c it encourages clear legal rules
as. discourages violent response to self-help
at. court basically says it aint okay to take law into your own
hands you can get it wrong so easy, and its necessarily
confrontational. Its more peaceful to run it through the
courts.
au. (fyi the no self-help eviction is usually limd to
residential leases b/c it helps those with uneven bargaining
power w/ the landlords.)
47. No Self-Help - Public policy discourages the landlord taking the
law into his own hands. Self-help is not allowed and even if it is
peaceable. A breach of peace is likely in self-help. At some point
a fight will break out, as matter of judicial economy, the tenant will
go to court anyway. This is now the rule in every state.
48. However self-help does help a tenant with a poor credit, because
there is no eviction record.
49. Brief Fact Summary. Plaintiff sued for wrongful eviction and asked
for damages based on the landlord changing the locks to the
premises in question.
50. Synopsis of Rule of Law. The only lawful means to dispossess a
tenant who has not abandoned nor voluntarily surrendered, but
who claims possession and rights adverse to those claimed by
landlord, is by resort to judicial process.
51. Issue. There are two issues for review:
52. Whether the evidence was sufficient to support the jurys finding
that the tenant did not abandon or surrender the premises.
53. Whether the trial court erred in finding that the Defendants reentry
was forcible and wrongful as a matter of law.
54. Held. Affirmed. The only lawful means to dispossess a tenant who
has neither abandoned nor voluntarily surrendered, but who claims
possession of the property, is by resort to judicial process.

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55. Minnesota has historically followed the common law rule that a
landlord may rightfully use self-help to retake leased premises
from a tenant provided that the (1) landlord is legally entitled to
possession and (2) landlords means of reentry are peaceable.
56. However there is a growing modern trend holding that self help is
never available. This view is founded on the premise that the
potential for violent breach of peace inheres in any situation where
a landlord attempts by his own means to dispossess a tenant.
57. Discussion. The court discussed first the historic approach
Minnesota had taken with respect to self-help evictions by
landlords. However, current trends demonstrate that any form of
self-help has the potential to catalyze a violent breach of the peace.
The court noted that state statute would allow a judicial proceeding
that could have the tenant evicted within three to ten days. The
court noted that this was a departure from the historic approach
taken, but justified to avoid any future potentially violent
encounters between landlords and tenants.
xix. Summary Proceedings
58. Every state allows for quick and efficient means for landlord to
recover possession after ending of tenancy. The cost is passed on to
the other tenants.

The Tenant Who has Abandoned

Possession
59. Sommer v. Kridel (1977) (p. 469)
av. The landlord must try to mitigate the damages, like reletting the apartment out. The landlord must make a
reasonable effort to rent out the property. The landlords
actions made no sense because he lost so much money,
didnt rent the property for two years plus cost of lawyers.
aw. Tenant is still responsible for the rent if the landlord cant
find a new tenant, provided that the landlord makes a good
faith effort (reasonable) to rent the apartment.
ax. Under common law there was no mitigate damages because
the landlord leased the land had no interest in the land until
the lease was up.
ay. Reason for no duty to mitigate rule: the cost should be on
the tenant to find a new tenant, the courts should not
encourage abandonment b/c it encourages vandalism,
wrong to break agreement but their own wrong doing

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tenant imposes cost on the landlord. A Small number of

states still have this rule.
az. If the property increased in value after the tenant
terminates: if the tenant lease is still on then, the original
tenant receives the extra money of the rent in order to keep
the original tenant on the hook, otherwise it goes to the
landlord. If the landlord does not give the increase value to
original tenant then tenant is not liable for rent after 2nd
tenant leaves.
ba. If a tenant moves out and a substitute tenant moves in then
leaves before the original lease is up the original tenant is
still liable for the rent while empty.
bb. If the landlord makes a good faith effort to rent and finds
no one, the tenant must still pay losses to the landlord,
damages for finding a new tenant and the rent. End goal put
both parties in the same place if the lease had continued to
its end.
bc. When does a landlord have a duty to mitigate damages?
bd. Sommer v. Kridel D signed a 2 year lease and then she
dumped him, and her parents were supposed to help D pay
for it. He offers the sec deposit as concession and says I
cant take the apt after all. Landlord doesnt do shit.
Landlord turns down other tenants but does eventually rent
it again, and sues D for back rent.
be. P argues there is no duty to mitigate; under the old English
rule, the leasehold had to be delivered actually, so the
landlord couldnt relet it. (this is the property aspect of the
leasehold its a conveyance, so convey that shit.)
bf. US courts look at it as a K as well, and that gives rise to the
duty to mitigate damages. US courts require legal delivery,
so now (as held in this case) [a] landlord has a duty to
mitigate damages where he seeks to recover rents due from
a defaulting tenant.
bg. This is simply more fair thats how the do away with the
precedent. The old English is unfair, and we cant justify
this on policy grounds. Rentals are scarce, and each
property is unique. You just cant be a dick about it.
bh. So there has to be reasonable efforts (this is a balancing
question Landlord bears the burden to show they gave it a
shot, with stuff like ads or walk-throughs.)
bi. This is now the majority rule for residential, and in MD, we
have it for both residential and comml leases.
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bj. The Rule of the Least Cost Avoider duties go to the

person who is the best at avoiding costs. E.g. landlords get
the duty to mitigate b/c its probably easier and cheaper for
them to find tenants than a tenant could
bk. Another way out of the lease is to surrender the lease. If
Kridels offer to get out of the lease w/ the concession of
the sec deposit, it wouldve terminated the lease, but would
still have been liable for back rent and damages. Where the
tenant abandons the property (or offers surrender but it is
not accepted), the landlord can:
bl. treat it as an implied offer of surrender
bm.
Leave the premises vacant and recover the accrued
rent (limd by the new duty to mitigate)
bn. Mitigate damages and recover lost rent/differences in rent
bo. E.g. you can sue for the time it sat vacant and for any diff
in the money you get now than what you had in the orig
lease.
bp. Brief Fact Summary. Landlord sues for rent for the entire
period of the lease when tenant vacated apartment prior to
expiration of the lease.
bq. Synopsis of Rule of Law. A landlord has a duty to mitigate
damages by attempting to re-let an apartment vacated by a
tenant at fair market value.
br. Issue. Whether a landlord seeking damages from a
defaulting tenant has a duty to mitigate damages by making
reasonable efforts to re-let an apartment wrongfully vacated
by a tenant.
bs. Held. Reversed, a landlord does have an obligation to make
a reasonable effort to mitigate damages in this situation for
the following reasons:
bt. Application of the contract rule requiring mitigation of
damages to a residential lease is justified as a matter of
basic fairness. If the landlord has other vacant apartments
besides the one which the tenant abandoned, he has a duty
to make reasonable efforts to attempt to re-let the apartment
and treat it as one of the vacant stock.
bu. To assess whether the landlord made reasonable efforts to
mitigate, the court should consider whether the landlord
offered/showed the vacant apartment, advertisements,
among other factors.

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bv. The landlord need not accept less than fair market value
rent or substantially alter his obligations as established by
the pre-existing lease.
bw.Discussion. The court overruled precedent based on the
theory that when the landlord signed the lease with a
tenant, the landlord may not interfere with the estate
granted to the tenant by the lease. The court noted that a
lease for residential property could no longer be
distinguished from an ordinary contract and thus was
subject to the contract rule requiring mitigation of damages.

Problems on Page 291

1 (a): NJ Said that this was unreasonable as long as the basic financials are in order you
should be able to lease to anyone that you would like. From an economic standpoint this is
probably wrong.
1(a) Second Paragraph: This is a reasonably grounds for withholding consent because of the
prospective competitor.
1(b): NY Court says unreasonable its about the economic aspect and getting your rent and
not your personal beliefs. (He seemed surprised by this).
If they had religious services there- might change the outcome (good exam question maybe?)
1(c): Pestana redux Landlord can only get what the originally bargained for
2. Its a subterfuge but the rule is still the rule restrictions on alienation of land are narrowly
construed only an assignment is not able to be done so even though this was clearly done to
skip pass this restriction the rule says this is a sublease.

Quiet Enjoyment and Constructive

Eviction
Next, Duties Regarding Condition of Property.
First the Covenant of Quiet Enjoyment and Constructive Eviction. These are
distinct (but used to be treated as the same.)
They are distinct now b/c of the dual nature of leaseholds as K and property. At
common law, even if a landlord was covenanted to, say, maintain the common area,
the tenant is still obligated to pay rent (this is the property side of it.) The K version
says if either side breaks a promise, the K is toast.
But every single lease even in olden times implied the covenant of quiet enjoyment
that the landlord wouldnt interfere with the tenants right to actually possess the
land during the term of the lease. Even old timey tenants could quit paying rent if a
tenant broke this rule.

77

So what counts as a breach of the covenant of quiet enjoyment? Used to be physical

ouster only if they physically kept you from being on the land, that broke the rule.
Over time, this has been expanded to include constructive eviction (and breach of
other promises.) Constructive eviction is the landlords interference with the
tenants enjoyment of the premises such that the tenant has no choice but to
vacate.

To recap nowadays, landlords are prohibited from leasing residential units that are not
habitable. Stuff like hot water, heat, running water, etc.
Used to be that you took premises as-is caveat lessee. But now, its implied that your place is
livable. That its implied is important b/c nobody has to write it in, and nobody can waive it.
Cant charge cheaper rent in exchange for making the tenant fix their own stuff. Is this a good
policy?
Maybe? In economic terms, it creates costs by pricing some people out of the market, but it also
protects the disadvantaged bargainer.
The corollary to this implied warranty of habitability is that landlords cannot evict you with self
help. If you require a landlord to go to court, the landlord will likely get less than he would have
otherwise. But otherwise you risk violence. Prof wants us to think about the drawbacks of
enhancing the rights of one side of the leasing coin over the other.
Final points implied warranty of habitability applies only to residential leases. Implied
covenant of quiet enjoyment applies to residential and comml leases.
What is habitable depends on totality of circumstances objective R person test. Failure to
adhere to municipal codes is not dispositive.
Although landlord has duty to maintain place, tenant has duty not to commit waste. Dont break
shit. Flush the crapper. Take out the trash. Etc. Tenant has a duty to notify landlord of anything
that goes wrong.

xx. Under common law, the landlord is not responsible for the breaches of the
other tenants. Today some courts say that the landlord has some control
over his other tenants.
a. The Illegal Lease
xxi. When the property is unsafe and unsanitary conditions the contract is
illegal and void. The code violations must have taken place before the
lease was signed not after.
b. Duty to Deliver Possession
i. Moving on to The Duty to Deliver Possession. Say L enters into a lease
agreement with T to start 4/1. But T shows up, and the old tenant is still

78

there. Drinking beer, no doubt. Who has the responsibility to get that old
guy out?
ii. In America, its your problem as the tenant. Landlord is only required to
deliver legal possession.
iii. But it depends on the state, and lots of US states follow the Old English
rule
iv. The English rule requires both legal and actual possession. A holdover
tenant is the landlords problem.
v. This is now the majority rule.
vi. New tenant can terminate and sue the landlord. (this rule is driven by the
least cost avoider the landlord prob has better chance of getting the old
guy out for the lease amount of money.)
c. The Implied Warranty of Habitability
d. Now to Implied Warranty of Habitability. Old rule was caveat lessee you lease
your shit as-is. Choose wisely. Over time, CL has shifted to give birth to this
implied warranty, which is only applicable to residential leases in all but 3 states.
xxii. Hilder v. St. Peter (1984) (p. 493)
60. A rental of any residential dwelling unit there is always an implied
warranty, which the landlord insures that the premises are safe,
clean, and fit for human habituation. Does not apply to issues
caused by the tenant.
61. A substantial violation of an applicable housing code shall
constitute prima facie evidence that there has been a breach of the
warranty of habitability.
62. Punitive damages are available in a tenant in appropriate cases,
must be a willful and wanton or fraudulent breach.
63. Hilder v. St. Peter P tenant sues landlord for damages sustained
as a result of the D being a slumlord. Broken window, no toilet,
smelled like sewage, no lock, leaking ceiling causing falling
plaster . . . pretty crappy place. P notified D, D promised but never
fixed anything. P paid to fix lots of stuff and paid rent every
month. Shes suing for punitive damages and all the rent she paid.
64. S. Ct. of Vt looked at the old rule, tossed it and said there should
be an implied warranty of habitability. Landlords are in a better
possession to fix the premises than the tenants. To succeed on this
claim, a tenant has to show:
65. Landlord had notice and failed w/ in a R time to repair it
66. Defect existed during the time the rent was withheld
67. This is totality of the circumstances of what violates this implied
covenant (and most states say this is not a waivable thing either
cannot K around this.) Violations of the housing code are prima
facie evidence of violating this covenant. Looks at basic health and
safety, and this is a pretty low bar. It has to be a pretty crappy place
79

to violate this covenant, and the landlord has to be a pretty crappy

landlord.
68. So why waive it if the tenant caused the damage? B/c that would
be against the Doctrine of Waste you owe the landlord an apt
when your lease is done. You break it, you dont get to then stop
paying rent.
69. If there is a breach, tenant has 4 options:
a. Remain in possession and sue for damages for the breach of
the warranty
b. Rescind the lease, thereby permitting the tenant to vacate
w/ no further obligations to pay rent
c. Remain in possession and w/hold rent
d. Repair the defects and deduct the costs from rent
70. Brief Fact Summary. The Plaintiff, Hilder (Plaintiff), moved into to
an apartment with substantial defects, some of which she repaired
at her own cost. Plaintiff sued to recover paid rent and money
spent to repair defects in apartment.
71. Synopsis of Rule of Law. When the landlord breaches the implied
warranty of habitability, tenant can withhold rent, repair defects
and deduct this cost from rent payments, seek rent already paid,
and seek punitive damages in the appropriate cases.
72. Issue. The Defendants raised three issues on appeal:
73. Whether the courts award to Plaintiff of the entire amount of rent
paid to Defendant was proper when the Plaintiff remained in
possession.
74. Whether the courts finding that Mr. St. Peter acted on his own
behalf and with the apparent authority of Ms. St. Peter was
sustainable.
75. Whether the court correctly calculated the amount of damages
awarded to Plaintiff.
76. Held. Affirmed in part, reversed in part and remanded. Plaintiff is
entitled to either withhold rent or seek damages in the amount of
rent previously paid.
77. An implied warranty of habitability exists, requiring the landlord to
deliver and maintain through the lease, premises that are safe,
clean and fit for human habitation.
78. The warranty of habitability covers all latent and patent defects in
the essential facilities of the residential unit. Essential facilities are
facilities vital to the use of the premises for residential purposes.
79. A tenant cannot assume the risk by acknowledging a defect, nor
can the implied warranty of habitability be waived by a covenant
in the lease.

80

80. To bring this claim, the tenant must show that he first notified the
landlord and gave the landlord a reasonable time to correct the
defect.
81. Discussion. The court went through the history of landlord tenant
law and noted that in todays modern society, the landlord is more
familiar with the complex operations associated with apartment
building maintenance and repair, while the tenant is at a
disadvantage in bargaining power. The court also noted that
punitive damages are appropriate in cases where the landlords
behavior is willful and wanton or fraudulent.
xxiii. Under Common Law the court did not care if the home was destroyed, the
tenant was still liable for the rent because the court viewed a lease as right
to the land not a home.
xxiv. Makes for sense for the landlord to be responsible to fix and upkeep the
property, today. Implied Warranty of Habitability cannot be contracted
around or waived. Does not apply if the tenant caused the problem, the
tenant is causing waste because the landlord has a reversion. Landlord can
charge the tenant for problems they cause or evict the tenant.
xxv. Tenant can withhold the rent until the damage is fixed. A very strong tool
at the tenants disposal, Landlord gets no rent and he cant release the
property. Court uses a reasonable person test, to decide the case. Landlord
cant retaliate against the tenant.
82. Tenant is only liable for reasonable rental value of the property in
violation of the warranty but the reasonable rental value depends
on the type of breach (it could be 0). Damages should also be
allowed for tenants discomfort and annoyance.
83. Tenant could withhold future rent
84. Deduct the expenses of fixing the problem himself only if the
landlord fails to act for a reasonable period of time after being
notified
xxvi. Not all jurisdictions have implied warranty of habitability. Did does not
apply to certain types of property: single family homes, agricultural.
e. Retaliatory Eviction
xxvii. Under common law a landlord had unlimited power to evict for any
reason, with proper notice. However this could lead to landlords evicted
tenants for excising their rights. Most states forbid retaliatory evictions for
this reason.
Probs p. 317
T has term of years, vacated early. L sues, T asserts constructive eviction based on
Ls breach of the covenant of quiet enjoyment. What result?

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1) L fails to respond from nonsmoking tenant from neighbor smokes too much.
a. b/c landlord has a power to act, and doesnt, this could be a legit
constructive eviction. This is a big fat maybe.
2) Lots of criminal activity in the bldg.
a. Sounds like R steps by landlord to mitigate, and landlord had no control
over conduct by 3d party criminals in the neighborhood.
More probs P. 327
a) This violates the implied warranty of habitability. This is a serious risk of
health and safety.
b) Its no longer implied. Its their own warranty. The implied warranty is
concerned with serious risk of health and safety.
Note also that landlords cannot retaliate against tenants who assert their rights.
Landlord cannot refuse to renew the lease for good cause.

Contract for Sale, Warranties, Remedies

Moving on from leasing to Transfers of Land. How do we sell land? We have a very old statute
of frauds (SoF) that covers this. Its meant to prevent fraudulent acquisition of land. Back in the
day, you had to satisfy this statute. It applied only to the first part of acquisition the contract
part. The second part is the deed that gets handed over. K part required a writing even back then.
We now have a second writing (the deed) for the second part; used to livery of seisin handing
over a clump of dirt.
b. The Contract of Sale
c. Statute of Frauds
i. Four basic requirements under SoF: 1: A writing; 2: Signature the agreement must
be signed by the party sought to be charged; 3: Description the agreement must
describe the land covered by the contract; and 4: price the writing must state the
contract price.
i. Serves evidence purposes. Other evidence circumstantial can overcome
the statute of frauds. Must be a writing signed by the party to be charged.
Must have a price or method of calculating the price. Some states require
the document to set forth material terms.
ii. Exceptions: partial performance and estoppel.
iii. Court will examine the expected behavior of the parties, people dont
normally send checks to strangers unless there is an agreement. Generally
the only remedy available is specific performance
iv. Estoppel Meant to prevent a party from denying their own actions that
have caused others to detrimentally rely on them
v. The contract is separate from the deed. Two separate documents. The deed
takes place of Livery of Sein.
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1. Hickey v. Green (1983) (p. 542)

a. A contract can be enforced notwithstanding SOF when the
party seeking enforcement in reasonable reliance on the
contract has so changed its position that injustice can only
be avoided by specific enforcement.
b. Hickey v. Green- P sues D for failing to sell the lot they
agreed to be sold. P brought deposit check to D that said
deposit for the house and D never cashed it. Then P sells
his house planning to buy the new lot, and D gets a better
offer in the meantime and changes her mind. P offers to
match that offer, but D said fuck you. So P sues. D argues
no writing, and didnt even cash the check to support that
there was a K.
c. However, estoppel wins the day. When the party seeking
enforcement has so changed his position in R reliance on
the K that injustice can only be avoided by specific
performance, estoppel can require specific perf. Ct said so
long as you add the condition that P pays the K price, D has
to sell it.
d. (note that this turned out this way b/c everyone knew why
P sold his house. If D hadnt known that was going to
happen, his reliance wouldve been pretty unR.)
e. Brief Fact Summary. The Plaintiffs, Mr. and Mrs. Hickey
(Plaintiffs), bring an action for enforcement of an oral
contract for the sale of real property.
f. Synopsis of Rule of Law. The Statute of Frauds (SOF)
requires a contract for the sale of real property to be in
writing. An exception to the requirement is when a party to
the oral contract partially performed in reliance on the oral
contract. Part performance allows the specific enforcement
of an oral contract when particular acts, such as paying part
of the purchase price or making improvements on the
property, have been performed by one of the parties to the
agreement.
g. Issue. Whether a partys part performance in reliance on an
oral contract to purchase real property makes the contract
enforceable?
h. Held. Remanded. The reliance of the Plaintiffs on their oral
contract with the Defendant created an enforceable contract
for the sale of real property. The case is remanded back to
the trial court to amend the judgment to require conveyance

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of the property only on payment to her of the agreed price

of 15,000 dollars.
i. Discussion. The SOF requires an action for the sale of real
property to be in writing and signed by the purchaser. If an
action for the sale of real property is not in writing and
signed by the purchaser the sale if void. An exception to
this rule is part performance by one of the parties to the
contract. If one of the parties to the contract has
substantially performed in reliance on the contract, such to
make it unjust to void the contract because of lack of
writing, the contract will be upheld.
vi. Marketable Title
1. A free title, clear of all claims. Such a title that a reasonable and
prudent person would be willing to pay a fair market value for. If
the seller cannot convey a marketable title, the buyer is entitled to
rescind the contract (not damages).
2. It is implied in every land contract.
3. Next topic today is Marketable Title. When you K to sell land, you
K to convey marketable title. Title not subject to such R doubt as
would create just apprehension in the mind of a R, prudent, and
intelligent person. If its under some cloud, its not marketable.
4. If someone can sue you if you own it, its not marketable.
5. Implied in every K to sell / buy land.
6. Remedy is rescission act as if there was no K in the first place.
Return deposits, call it a day.
a. Lohmeyer v. Bower (1951) (p. 548)
b. Lohmeyer v Bower D Ks to sell house to P. K specified
title free of all encumbrances that havent been disclosed.
This one had some issues: about the type of house that
could be there (was supposed to be 2+ story) and where in
relation to the prop line (was too close to prop line per city
ordinance.) These issues were discoverable (at the land
records.) P asks for rescission, D offers to fix it, P refuses
and sues.
c. Q is whether title was unmarketable. 1st point the court
makes is that city rules that may restrict propertys use or
value do not make titles unmarketable. Genl police power
rules that apply to everyone dont make them an
encumbrance on the title. 2d point is that private rules (like
the 2 story thing ) do encumber the title, and make it
unmarketable.

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d. The point is that some private party somewhere has

some kind of right to assert with regards to that land
e. City doesnt get any new rights just by having rules.
f. So the bottom line is that if there are private rules like the
2+ story thing in this case, you need to give explicit or
implied notice (implied by telling them to go to the
courthouse.)
g. Note the only encumbrances that make a prop
unmarketable are those to which they buyer did not get
notice
h. A marketable title is one that is free from R doubt of
litigation. Unmarketable exposes the party holding it to
litigation.
i. So why doesnt Ds offer to fix it, well, fix it? B/c the buyer
s/not have to get pushed into a K that he didnt bargain for
he didnt ask for more land than he Ked for. So adding a
strip to fix the prop line issue aint gonna cut it.
j. Suppose there is an easement a sewage easement, or
utility is that an encumbrance? Only if its not known
(like unrecorded would likely be.)
k. What if you are trying to sell lot E in the above? Is this
marketable? Id say yes. Nobody has a claim on E but
whoever buys E and the risk of litigation is all that matters
with marketability.
l. Brief Fact Summary. The Plaintiff, Mr. Lohmeyer
(Plaintiff), brought suit to rescind contract to buy land after
he discovered the structure on the land was in violation of a
city ordinance.
m. Synopsis of Rule of Law. A marketable title to real estate is
one, which is free from reasonable doubt and a title is
doubtful and unmarketable if it exposes the party holding it
to the hazard of litigation.
n. Issue. Whether the property in question is subject to
encumbrances or other burdens making the title
unmerchantable.
o. Held. Reversed. A violation of a city ordinance as well as
the other violations makes this title unmarketable and
doubtful.
p. A marketable title to real estate is one, which is free from
reasonable doubt and a title is doubtful and unmarketable if
it exposes the party holding it to the hazard of litigation.

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q. The defect which the purchaser complains must be of a

substantial character and one from which he may suffer
injury.
r. Discussion. The court analyzed what type of encumbrances
or issues would render a title to real estate unmerchantable
and allow a buyer to rescind the purchase contract. The
court noted that the Plaintiff was correct in basing his case
on current violations and not restrictions contained in the
deed. Public ordinances and zoning are not restrictions that
make a title unmarketable. They only do so, when the
property in question is already in violation of them.
s. Holding: as a matter of law, city laws and ordinances that
restrict propertys use and which exist at the time of the
contracts execution do not make titles unmarketable.
(violations of zoning does make the title unmarketable
because it leaves the buyer open to litigation) Private
restrictions on land use do make the title unmarketable.
t. Because the zoning ordinance was violated, there was an
encumbrance on the property and title was unmarketable
7. Equitable Conversion
a. On to Equitable Conversion (prof says we need to know
this maxim!) equity treats as done that which ought to be
done. (now you know. And knowing is half the battle. G. I.
Joe!!)
b. Once the K is signed, but before closing, the title is actually
split legal title and equitable title. Legal title is held by the
seller after the K is signed but the deed aint done yet.
Equitable title is whats held by the buyer it ought to be
given to him, so the courts treat it like its done.
c. So that means after the K is signed, the risk of loss is on the
buyer say you put a K on a house, and the house burns
down before closing. The loss is borne by the buyer. Sucks
to be him.
d. Split - The buyer is viewed in equality as the owner from
the date of the contract; the seller is to hold legal title as
trustee for the buyer. Seller is legal owner until the deed is
transferred. The risk of lost is on the buyer, this can be
contracted around. The buyer gets the benefit of insurance
if the house is destroyed.
e. If the seller dies before closing the legal title passes as
personal property. If the buyer dies it passes as real
property.
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8. The Duty to Disclose Defects

a. Stambovsky v. Ackley (1991) (p. 553) (Ghost Case)
i. D cannot deny that the house is haunted because he
created the reputation. The impact of the reputation
goes to the very essence of the propertys worth.
Generally a seller has no duty to disclose any
defects and a rule of caveat emptor applies. But,
special apparitions are not discoverable even in the
exercise of due care.
ii. Stambovsky v Ackley- that ghost case we read 1st
year. P Ks to buy a house thats reputed to be
haunted, seller totes encouraged that reputation.
During his due diligence, P finds this out and asks
for rescission. Ct says D is estopped from letting
him out of the K.
iii. Seller had no duty to disclose defects and caveat
emptor applies (thats why we have housing
inspection.) this was changed and is now the
minority view.
iv. Ct says where a condition created by the seller
materially impacts the value of the property, and not
discoverable by due care of the buyer, nondisclosure of the defect justifies rescission. Helps
buyers and sellers to bargain appropriately and with
confidence no hiding shit.
v. Rule: Where a condition created by the seller
materially impacts the value of the property and is
not discoverable by the buyer even in exercise of
due care, non-disclosure constitutes a basis for
rescission
b. The courts allow rescission to allow the parties to renegotiate the terms to weigh pros and cons of the
problem/benefits of the deal, therefore the courts allow the
free market to fix the mistake.
c. Exclusion for certain problems: murders etc. (stigma
statutes).
i. Are exclusions to disclosure good or bad for public
policy?
1. Bad the buyer is entitle to know, he would
have paid less if he knew, Law and Econ
theory - market works best when both
parties are fully informed.
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2. Good these problems dont really affect

the property. Dont want seller advertising
that their neighbors are lesser,
discrimination. Not trying to hide the ball
from buyers.
ii. Johnson v. Davis (1985) (p. 557)
1. the seller must disclose all material facts that
affect the value of the property if he is aware
of such defects
2. Johnson v Davis more moving away from
caveat emptor. P buys house w. leaky roof,
D told him it was fine but he knew it was
leaky. Ct said that when the seller knows
fact materially affecting the value and
doesnt disclose, its not fair.
3. Brief Fact Summary. The Plaintiffs, the
Daviss (Plaintiffs), brought suit to rescind a
contract to buy property after they
discovered the roof of the house leaked. The
Defendants, the Johnsons (Defendants), had
represented that the roof was fine.
4. Synopsis of Rule of Law. When a seller of a
home knows of facts materially affecting the
value of the property, which are not readily
observable and are not known to the buyer,
the seller is under a duty to disclose them.
5. Issue. Whether the seller had a duty to
disclose a latent material defect.
6. Held. Affirmed. The Defendants fraudulent
concealment of a material fact entitled the
Plaintiffs to a return of their deposit.
7. In determining whether a seller of a home
has a duty to disclose latent material defects
to the buyer, the law distinguishes between
inaction and action. However, this
distinction, in light of modern cases is not in
line with current developments of restricting
the doctrine of caveat emptor. Full
disclosure of all material facts must be made
whenever elementary fair conduct demands
it.

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8. Discussion. The courts discussion primarily

focused on the modern judicial trend of
restricting the doctrine of caveat emptor.
The reason for this restriction was that
current notions of fair dealing and justice
make it wrong to shield a seller who takes
advantage of a buyers ignorance. The court
found that other jurisdictions have been
taking a similar route ruling that if the seller
is aware of a material defect, he has a duty
to disclose this to the buyer.
iii. Common Law caveat emptor buyer can make
inspection before the purchase, which is all the
person can do. No duty to disclose.
vii. Merger
1. Once a deed is transferred, it is the deed that is the governing
document, not the contract
2. Accepting the deed means that the buyer is satisfied that all of the
contractual promises are performed
3. If the buyer wishes to have some security interest against the seller
after deed transfer, he should put the covenants in the deed because
he will no longer be able to rely on contractual promises
4. Merger doctrine is now full of exceptions.
5. All remedies discussed on Monday come into play prior to Merger.
Once you have the Deed you cannot rescind. BY accepting the
Deed, to the Seller and the World, that whatever the Seller
promised you they fulfilled and you accepted for the tender of
the Deed.
6. Merger traditional doctrine once the deed is transferred the
Deed is the governing document of any further relationship
between the buyer and seller and not the contract of sale.
7. To the extent that the buyer wishes to have any future security
against the seller the buyer better request that certain
requirements are placed into the Deed itself (see Covenants of the
Deed). Any future promises must be put into the Deed itself.
8. This traditional rule is slowly coming out of favor but this is still
tested on the Bar.
viii. The Implied Warranty of Quality
1. Requires the builder of a structure to do an adequate workmanlike
job it doesnt have to be the best, just workmanlike
2. There are different remedies
3. Only applies to those in the business of building/selling homes

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4. The Implied Warranty of Quality (kinda a new rule old rule was
caveat emptor) - Only applicable to buyers of recently constructed
homes. Same ethos as Implied Warranty of Habitability
(Landlord/Tenant). Implied Warranty of Quality means that the
builder of the home agrees that the home that he builds will be of
workmanlike quality (check this) (this topic he barely touched on)
5. Just because youre not delivering a super fancy home this
doesnt breached the Implied Warranty of Quality it only needs
to meet the Workmanlike standard.
6. Remedies for breach of this warranty: 1) you can get your builder
to fix it; 2) you may rescind it; 3)
7. Waiver is allowed, but it must be clear
a. Unlike IW of Habitability. A renter will be stuck with one
slum lord or another if IW of H was waived. A buyer of a
house may be in a better situation to pick and choose a
property, therefor not as worried about a buyer being taken
advantage of.
8. Similar to implied warranty of habitability in leases.
a. Liability of Builder was limited to the privity of contract
only to the party they had contracted with. This has mostly
been abolished since shell sales could be used for the
first sale and then they buyer would sell it to another
party, which did not have privity of contract with the
builder

Prob p 350
1) O conveys to A, O asks A for the deed back. O tears up the other deed. Who owns
it?
a. A. The deed was executed and delivered it was effective. There was
no memorandum supporting the return gift.
2) Suppose that O gives interest in the property to A as joint tenants. Then changes
her mind and says shed rather her grandson B to have the interest. They white out As
name and write in Bs name, then go record the deed. Then O dies. Who owns it?
a. A remains jt owner. Altering a deed doesnt change it. Theyd have to
write a new deed if they wanted to change things.

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Remedies for Breach of the Sales

Contract
In Summary
Whenever breaching buyer proves that the deposit (with seller) exceeds the sellers damages
then the buyer can get the difference between the damages and deposit back. This is the default
rule only in play if the contract doesnt specify otherwise.
Majority Rule = if you put down 20% of the deposit the seller cant keep any more than 10% of
the purchase price (cap)
Real Estate is not fungible since its not like a bushel of corn property is unique.

b. Three remedies are available to the non-defaulting party:

i. Damages,
ii. Retention of the deposit (sellers) or restitution of the
deposit (buyers),
iii. Specific performance of the contract.
c. Jones v. Lee - Several types of remedies:
i. Specific performance (conditioned on the
desirability on the buyer still tendering on the fee);
ii. Rescission simply to walk away go back to
square 1
iii. Damages.
iv. Brief Fact Summary. The plaintiffs enter into a
purchase and sale agreement for a price of $610,000
for their home. The buyers seek to terminate the
contract, and the sellers are forced to sell at
$540,000, a difference in contract price of $70,000
originally agreed to by the original buyers. The
sellers sue for breach of contract.
v. Synopsis of Rule of Law. When a buyer breaches a
contract for a purchase and sale agreement the
sellers may (1) seek relief in equity for rescission,
(2) offer to perform and bring an action for specific
performance, or (3) elect to retain the realty and file
suit seeking an award of damages. Where a party
elects to sue for damages resulting from a breach of
land sale contract, the burden is on that party to
present competent evidence to support such claim
for damages.

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d.
e.
f.
g.

vi. Issue. Whether the sellers are entitled to a claim of

damages for the failure of the buyer to complete a
purchase and sale agreement.
vii. Held. The trial court properly held that damages
including special and punitive damages may be
awarded in a breach of contract for a purchase and
sale agreement upon a showing of sufficient
evidence by the party electing to sue for such
damages, and in this case the defendants were
entitled to such damages.
viii. Discussion: The Sellers also presented evidence
that the interest payments on the mortgages totaled
$4500 during the time when they continued to try to
sell the property, which were damages that were
determined by the court to be reasonably
foreseeable upon default.
ix. -The court also held that the cost of warranties were
reasonably foreseeable because there was a list of
warranties, the costs of which are sometimes borne
by the sellers in the contract.
Its the non-breaching party (they honored the contract) that
can choose which of these remedies to seek.
In this case, they choose damages.
Problem with this, is that it presumes a static market
Can get Actual Damages, Special Damages, and punitive
damages (if egregious, though rare in contract cases)

Kutzin v. Pirnie whenever the breaching buyer proves that

the deposit exceeds sellers damages, he can get the
difference back, but the rule is limited to situations where
the contract doesnt specify alternatives
h. Brief Fact Summary. The defendants, Duncan and Gertrude
Pirnie contract for the sale of the Kutzins' house for
$365,000. The contract did not provide for liquidated
damages or forfeiture clause regarding the deposit.
i. Synopsis of Rule of Law. In order to prevent unjust
enrichment, a seller may retain a deposit when a buyer
breaches a contract even if the contract does not contain a
liquidated-damages or forfeiture clause.

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j. Issue. Whether a seller should be entitled to retain a deposit

when a buyer breaches a contract that does not contain a
liquidated-damages or forfeiture clause.
k. Held. Judgment affirmed. The trial court held that the
Kitzins' cannot retain the entire deposit as damages. In
order to prevent unjust enrichment the restitution costs
must be offset by the deposit LESS the amount of the
injury caused by the breaching parties actions. The
judgment of the Appellate Division is modified to reinstate
the trial court's damage award.
l. Discussion. The Pirnies are entitled to restitution of their
deposit less the amount of the injury to the Kutzins caused
by the Pirnies' breach. To allow retention of the entire
deposit would unjustly enrich the Kutzins and would
penalize the Pirnies contrary to the policy behind the laws
of contracts.
m. The majority of states allow the seller to retain the down
payment because of the difficulty of estimating actual
damages and the general rule is that the traditional 10% is a
reasonable amount.
n. If the seller backs out, because seller finds a buyer that is
willing to buy more? The buyer can go after the seller for
the increase in price.
o. If the title is unmarketable? Buyer can rescind (English
Rule). Buyer gets damages, which are difficult to calculate
(American Rule). States are spilt 50/50 on which rule to
use.
p. Sellers are entitled to reasonable time to cure defects
because they are contracts.
q. Rescission remedy discussed here. If you choose
Rescission at common law, you could keep the deposit (if
you wanted to).
r. New Jersey adopted the modern view here Page 370. Its
set out in 374(1) of the Restatement (Second) of Contracts.
to deny recovery in this situation often gives the seller
more than fair compensation for the injury he has sustained
and imposes a forfeiture (which the law abhors) on the
breaching buyer. This approach is suggested to have the
added benefit of promoting economic efficiency: penalties
deter efficient breaches of contract by making the cost
of the breach to the contract breaker greater than the cost of
the breach to the victim.
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HYPO: Initial Price = 100,000. Deposit = 10k. Ultimate Price = 95k. If he keeps deposit too, he
gets 5k more. Court would say that the seller getting the extra 5k is unjust enrichment.
HYPO: Initial Price = 100,000. Deposit = 10k. Ultimate Price = 85k. In this situation, the
breaching party doesnt get anything back.
HYPO: You contract to buy Unit #7. The seller backs out but you can buy Unit #8. Should be
able to force the sale of Unit #7 because its not the same unit.
Answer: Yes property is unique. But this rule has been eroded to the type of building as a
condo.
HYPO: What if breach is the other way around. The seller contracts to deliver marketable title
and turns out that he cant. What are the buyers remedies?
English Rule: He can get the deposit back and any direct expenses but no damages absent bad
faith on the seller.
American Rule: Benefit of the bargain will get your deposit back, and any expenses, and any
damages.
Specific Performance: You tell the Seller, look I understand you cant deliver marketable title,
but I love this property, so Ill take it in any way you can transfer the title, but I want you to
reduce the price. So in exchange for waiving your claims for non-marketable title, you get a
reduced purchase price.
Almost no states have adopted UCC to deal with property disputes so it doesnt apply. Why?
Real Estate isnt mobile and Real Estate Lawyers apparently.

Deed & Delivery

The Deed signifies that the land has passed from Party A to Party B.
What does a Deed include?

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1. Consideration. Its important to indicate some consideration, so that you can show there was a
presumption that land was purchased for value, rather than given as a gift or through inheritance.
2. Acknowledgement.
3. Description of Tract of Land.
d. The Deed
i. Warranties of Title
ii. Includes certain information such as: consideration, description of the
land, signature, grantor and grantees names
iii. Forged deeds are void and subsequent grantees, even bona fide purchasers
get nothing
iv. Fraudulent deeds are voidable by the grantor and if the grantee who got
this deed conveys to a bona fide purchaser, the bona fide purchaser will
prevail
1. Three types of deeds:
a. General warranty deed warrants title against all defects
in title, whether they arose before or after the grantor took
title. General Warranty Deed (the best Deed). This Deed
provides the greatest degree of protection, warranting title
against all
b. 6 Covenants:
i. PRESENT (in presente) Can only be broken at
the time of the transfer/Deed (once statute of
limitations runs, you cannot sue on these)
ii. 1. Seisin (The grantor actually has what he is giving
you)
iii. 2. Right to Convey (The transferor warranties that
he has the right to convey what he is conveying
usually hand-in-hand with Seisin but sometimes
they dont (could be a good exam question)
iv. 3. Encumbrances (warranty that there are no liens,
easements, mortgages, etc.)
v. FUTURE: (Statute of limitations doesnt run on
these covenants until they are actually broken
which may be never)
vi. 4. General Warranty (the transferor will indemnify,
protect and compensate the grantee for any loss as a
result of a lawful claim brought by someone else on
the land. He doesnt insure you from being sued,
though)
vii. 5. Quiet Enjoyment (grantor warranties that the
grantee will not be disturbed in his possession by

95

assertion of superior title. He basically tells them

that nobody is going to come along and say that I
have a better claim to this land than you do).
viii. 6. Future Assurance (grantor promises that whatever
additional documents that are necessary to be
signed, if they are necessary, to protect your claim
to the land, they will actually do that)
ix. General Warranty contains six express warranties:
1. A covenant of siesin must own the estate
being conveyed
2. A covenant of right to convey
3. A covenant against encumbrances no
mortgage, liens, or covenant
4. A covenant of general warranty grantor
pays to defend the title
5. A covenant of quiet enjoyment grantor
will not disturbed
6. A convent of further assurances grantor to
convey documents to perfect the title
conveyed.
x. First are present conditions and last three are future
conditions. SOL on first three begins to run at time
of conveyance and last three SOL at time of
eviction or broken covenant.
c. Special Warranty Deed contains warranties only against
the grantors own acts but not the acts of others. The
grantor is not liable for the acts of previous owners Ex.
Mortgages. Special Warranty Deed (an
acquaintance/Shaggy It wasnt Me). It contains
warranties only against the grantors own acts but not the
acts of others. Thus, if a defect is a mortgage on the land
executed by the grantors predecessors in ownership, the
grantor is not liable.
d. Quitclaim Deed contains no warranties of any kind. Only
the rights the grantee has. Quit Claim Deed (I dont even
know if I own this land). This merely conveys whatever
title the grantor has, if any, and if the grantee of a quitclaim
deed takes nothing by the deed, the grantee cannot sue the
grantor.
e. What about a forged Deed? Its a complete nullity its
simply a piece of paper that means nothing. No one
acquires any right via a forged deed.

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f. HOWEVER, if you occupy land upon a forged deed you

can maybe obtain the land lawfully through the theory of
adverse possession.
g. What about a deed procured by fraud? It is voidable by the
grantor in an action against the grantee. Grantor introduced
the deed into the stream of commerce they could stop the
chain of events of fraud from happening
i. Brown v. Lober (1979) (p. 591)
1. The warranty of quiet enjoyment can only
be sued on when possession is interfered
with, which mineral rights to do not.
2. He shouldve used the argument of Right to
Convey and Seisin but instead argues
violation of Quiet Enjoyment why?
Because of the 10 years statute of limitations
has run through.
3. Possession is key to the Quiet Enjoyment
covenant. Remember this.
4. Mineral are different than tents/structures
need to start extracting the minerals to
possess them. This wasnt done in this
case.
5. Covenant of Quiet Enjoyment can only be
violated when possession is interfered
which wasnt the case here.
6. Until someone bothers the Browns, theres
not much that they can do
7. Brief Fact Summary. Plaintiffs brought suit
for breach of the covenant of quiet
enjoyment after discovering they were not in
possession of all of the mineral rights to the
property they purchased.
8. Synopsis of Rule of Law. Until one holding
a paramount title interferes with Plaintiffs
right of possession, there can be no
constructive eviction and no breach of the
covenant of quiet enjoyment.
9. Issue. Whether the plaintiffs have alleged
sufficient facts to constitute a constructive
eviction?
10. Held. Reversed. To have a breach of the
covenant of quiet enjoyment, Plaintiffs

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would have to demonstrate that someone

holding a paramount title interfered with
Plaintiffs right to possession. Possession of
the surface area does not carry possession of
mineral rights. To possess the mineral estate,
one must undertake the actual removal
thereof from the ground or do such other act
that will apprise the community that such
interest is in the exclusive use and
enjoyment of the claiming party. Until one
holding a paramount title interferes with
Plaintiffs right of possession, there can be
no constructive eviction and no breach of
the covenant of quiet enjoyment.
11. Discussion. The court focused on the
premise that even if an individual is aware
that there is a person holding paramount title
to his own, that person must actively
interfere with their right to possession before
the covenant of quiet enjoyment can be
breached. The Plaintiffs in this case have
been in no way hindered as of yet in their
enjoyment of their land. They merely were
put on notice that there existed another
individual with rights in their property.

2. Estoppel by Deed
a. If A sells land that he does not own, but later acquires title
to that land, he is stopped from asserting that title. The
newly acquired title automatically passes to the grantee.
b. Interesting MD Rule he learned today: The default deed is a
Special Warranty Deed wheras in VA, their default deed is a
General Warranty Deed. Logically, this means that land in
MD is cheaper but thats not true. Why is this? Because
of Title Insurance! With Title Insurance, you dont need to
worry about the warranties.
c. Equity regards as done which is ought to be done and
also, this makes sense in light of Covenant of Future
Assurance. If its simply necessary to sign another
document to give the land, youve already made that
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promise and you are obligated to sign those documents

over to me
3. Delivery
a. To be effective, a deed must be delivered with intent to be
presently operative (even if it creates only a future interest).
Deliver does not mean handing over, but that shows intent
that an intent to be immediately bound by transfer.
b. Deed must be delivered in order to be effective. It must be
delivered with the intent to be presently operative it must
convey rights to you TODAY not in the future or
conditioned on something in the future even if it only
conveys future interest (like a life estate deed).
c. In Sales, delivery is presumed. You dont just throw money
at people without the intention of getting something back.
Problems arise in donative transfers. When you give
something to somebody as a gift, you must have delivery.
d. Delivery is accomplished by giving the Deed to the grantee
OR to a third party with instruction to deliver.
i. Sweeny v. Sweeny (1940) (p. 606)
1. Delivery must be made with intent to pass
title in order for it to be effective. Physical
possession of the deed is not conclusive
proof that the deed was legally delivered,
but it does presumptively proof and pretty
good evidence.
2. What does it mean to deliver a deed?
3. They were trying to disinherit the wife
wanted it to go to the surviving brother.
4. Recordation is useful but is not effective as
far as the validity of the deed.
5. Occupant of property does first and the
widow claims she owns the property through
intestacy (he died without a will).
6. Surviving brother argues he never delivered
the new deed back to his brother so it
wasnt effective.
7. Court says delivery must be made with
intent to pass title.
8. Physical possession of the deed is not
conclusive truth that it was actually
delivered. Its damn good evidence but not
conclusive truth. It is a presumption.

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9. Court said there was no evidence to the

contrary
10. They couldve done a conditional delivery
a neutral third party did a deed to this
party from the brothers unless one of them
dies then the third party delivers the new
deed to the surviving brother.
11. If you have a piece of paper in your hand
presumably you got it legit (it was
delivered).
12. Four ways to do this:
a. What could the brothers have done
instead? Set it up as Joint Tenants
with Rights of Survivorship this
would work instead and would still
disinherit the wife.
b. Could also do a Life Estate
Maurice couldve given the deed to
John and John couldve done a
Life Estate back to Maurice with
remainder to John. What would
happen if John died first? Doesnt
matter would go to his heirs so it
still works.
c. Could also do a Conditional Deed
one that reflects if you survive me
clause. Problem would be this is a
causa mortis transfer and you cant
do that via Deed must be done
through a Will. The Deed would then
be invalid. (most states).
d. Could also deliver it to a third party
with instructions. (this is what
happened in the case)
13. Delivery doesnt have to be actual physical
delivery. It just is evidence of an actual
physical delivery. What is really important is
the intent.
14. This reflects the difference between personal
and real property. With personal property
you must physically hand over the item. You
cant do that for delivery.
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15. Brief Fact Summary. The Plaintiff, Mrs.

Sweeney (Plaintiff), is the estranged wife of
decedent and is suing to quiet title to land
that the Defendant, John Sweeney
(Defendant), alleged he acquired by deed.
16. Synopsis of Rule of Law. Physical
possession of a duly executed deed is not
conclusive proof that it was legally
delivered. Delivery must be made with the
intent to pass title for it to be effective.
17. Issue. Whether the second deed was
delivered and the condition attached to the
deed is valid.
18. Held. Reversed. There was no intent on
behalf of the grantor (decedent) to pass title
to the Defendant. A new trial is ordered
under the principles below.
19. Physical possession of a duly executed deed
is not conclusive proof that it was legally
delivered. Delivery must be made with the
intent to pass title if it is to be effective.
20. A conditional delivery is and can only be
made by placing the deed in the hands of a
third person to be kept by him until the
happening of the event upon which the deed
is to be delivered by the third person to the
grantee.
21. Discussion. The court found that there was
no intent demonstrated to actually pass title
to the Defendant because the decedent
continued to live and managed the land like
it was his own. The second argument
advanced by the Defendant was that the
second deed conveying the land back to the
decedent was invalid because there was a
condition attached to it that was now
impossible to fulfill. The court struck down
this argument with a rule that the court
stated applied whether or not it defeated the
purpose of the grantor because it protects
real estate titles against fraud.

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e.
f.
g.

h.

22. Can also have Conditional Delivery to be a

proper conditional deed, you deliver/place
the deed in the hands of an uninterested 3rd
party and directing them to deliver upon
some specified event.
a. To my brother, when I die.
b. E.g.: Bank, trustee, sheriff
c. Court was concerned that relaxing
the rule that deeds must be delivered
to 3rd parties would invite fraud on
the dead who can no longer testify
Inter vivos transfer of land requires the delivery of a
signed instrument
Transfer at death requiring an instrument complying with
the statute of wills.
Some states allow revocable deeds, if it is written on the
deed. But no states allow a deed to be placed in an
envelope and revocable at will. Policy a conditional deed
is similar to a determinable estate.
Fee Simple Absolute is not revocable. Because they were
trying to reserve the power to revoke to the grantor, this
transfer was not valid.

HYPO:
O gave land to A by a Special Warranty Deed. It happened that during Os ownership, another
party B, acquired Os land through adverse possession.
Answer: O does breach his warranty after all, under adverse possession, Bs actions were on
notice to O. If the adverse possession matured during Os ownership and therefore the
encumberance arose under Os ownership.
HYPO:
You know there is an encumbrance on the property, but the Deed says that there are no
encumbrances. Can you then sue for breach of the warranty against Encumbrance?
You are a bad person if you do this but you can legally do it.
Warranty of Encumbrances is not about knowledge its about encumbrances.

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Title & The Recording System

Why do we have recording statutes? They are meant to give notice to the public (third parties to
the transaction) about land transfers. Why does the public care? Well, if you are trying to buy a
piece of property, you may want to confirm ownership of the property, etc. Each state has
different recording statutes.
a. Title Assurance
i. The Recording System
ii. The recording acts generally do not affect the validity of a deed or other
instrument. Recording or lack thereof does not impact the validity of a
deed. The system:
1. Establishes a system of public record of titles for the benefit of the
public.
2. Provides an important place for records that might be easily lost.
iii. Anything of value can be recorded. If a person gets the land as a gift then
there is no equitable relief if the other claimer purchased the land. Almost
anything that impacts property interest can be recorded (From deeds to
easements to mortgages, etc.)
iv. Under common law subsequent purchaser is required to pay any interest
(mortgage) on the land for the previous owner.
v. Under Recording Acts a subsequent purchaser is protected against prior
unrecorded interests. Recording protects bona fida purchasers for value
who may not have known of prior unrecorded interests on land This
comes into play when the same piece of land is sold twice.

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vi. Prior in Time, Prior In Effect:

HYPO: O mortgages Blackacre to A. O subsequently conveys Blackacre
to B who does not know of the mortgage. At common law, B takes the
land subject to As mortgage. (In equity, the doctrine of bona fide
purchaser would protect B against As mortgage if As mortgage were
purely equitable and not a legal interest. Equity refused to enforce prior
hidden equitable interests against bona fide purchasers of legal title.)
1. The Indexes
2. Indexes. In and of themselves do not replace the actual record its
just a way to find the record.
3. How do we search an index? Its like doing a genealogical search.
Search up and down in the records look at the book. The class
may be confused by this Look at Page 419 for the chain example
4. When searching look for the date of transaction not necessarily
the date of recording.
a. Tract Index
b. Grantor-Grantee Index (most common)
a. States are split on whether a name mis-indexed, some say
that a mis-index does not provide notice.
5. Luthi v. Evans
a. Facts: Ps predecessor in interest assigned his interest in oil
and gas leases to D1. The deed to D1 simply stated: all
interest in Coffey county whether or not included in the
specific description. The deed to D1 also specifically
described each lease, but omitted from the description the
Kufahl lease. Assignment to D1 was recorded. The
Kufahl lease was thereafter then separately assigned to D2.
D2 personally checked the county records and did not
discover the assignment to D1 of the Kufahl lease. D2 then
recorded the assignment to himself. D1 now argues that
D2 owns nothing because D1 was the first to get the
assignment and the first to record it.
b. Whether a mother hubbard deed transfers (huge amount
of transfers) gives notice to the general public?
i. No, bc as a non-party to the transaction, the general
public has no idea what you own.
c. General description of property is insufficient to give notice
(but if purchaser had actual notice, the general description
would have been ok)
d. Mother Hubbard clause (all property in the county
very broad)
e. First to buy and first to record one argument
f. Recording statutes are to put the public on notice and if
you fail to do this then its no good it doesnt observe
its function.
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g. But is the rest of the world put on notice here? No.

h. How does this type of issue come up? Rushing death bed
transactions where time is of the essence Mother
Hubbard clauses are used.
i. Mother Hubbard deed doesnt put the public on notice. It
was not sufficient to put the public on notice.
j. Even though International Tours was first in Time, they
failed to put the public on notice
k. The case wouldve gone far differently if Burris had actual
knowledge that the property had been sold. Actual
knowledge trumps putting the public on notice so if
Burris already knew, he couldnt act like he didnt know
he wouldnt be acting in good faith wouldnt be the bona
fide purchaser.
l. Also, if the deed had incuded the description of the other
mineral rights but had simply been mis-documented in the
index, then it wouldnt be a problem
m. What would the remedy be of each of the defendants? Can
either sue the initial landowner and if so on what theory?
i. 1) Burris: Covenant of Seison could sue his
Grantor for this because once the land was
conveyed to Burris, it wasnt really the Grantors to
convey and Covenant of Right to Convey and
Covenant Against Encumbrances (so all of the
Present Covenants) Burris could sue on.
ii. 2) International Tours: Covenant of General
Warranties IF they have a General Warranty Deed
or at least Special Warranty Deed. So they could sue
for Future Covenants.
iii. They could also have a constructive trust created
look at Page 426.
n. Brief Fact Summary. The controversy was between two
purchasers who paid for the same oil and gas lease. Both
parties claimed rights to the land and a suit ensued to
determine if the second purchaser had constructive notice
of the purchase by first buyer.
o. Synopsis of Rule of Law. An innocent subsequent
purchaser without constructive notice as to the rights of an
initial purchaser will have rights to the land superior to
those of the initial purchaser.
p. Issue. Whether or not the recording of an instrument of
conveyance with a general conveyance clause of all of
ones property constituted constructive notice to a
subsequent purchaser.
q. Held. Reversed. The subsequent purchaser, Burris, did not
receive constructive notice of International Tours rights in

105

the land. A single instrument, properly executed,

acknowledged and delivered can convey separate tracts by
specific description and can convey separate tracts by
general description as well. The purpose of a statute
authorizing the recording of instruments of conveyance is
to impart to a subsequent purchaser notice of instruments,
which affect title to a specific tract of land in which the
subsequent purchaser may consider buying.
r. To give the subsequent purchaser constructive notice, the
instrument needs to describe the land with sufficient
specificity so that the land can be identified.
s. Discussion. The discussion focused on whether the
Mother Hubbard clause in the first conveyance was
specific enough in description of the land affected to give
notice to subsequent purchasers. A Mother Hubbard
clause is a clause, which intends to convey specific tracts of
land, but does so using very general language. The court
ruled that it would recognize this clause as legally
assigning such land between the grantor and grantee.
However the grantee must take steps to properly record
using additional documents if necessary so that other
subsequent purchasers will have notice.
6. Orr v. Byers (1988) (p. 661)
a. Misspelling of a name (even if it sounds the same) does not
give proper notice to the public about an encumbrance on
the land, and therefore the public cannot be charged with
constructive knowledge.
b. Debtors name was misspelled.
c. Doctrine of Idem Sonans (sounds the same).
d. Court said the doctrine has never been applied to give
constructive notice to good faith purchasers for value
e. The spelling of the name does not give proper notice and
the public cannot be charged with knowledge
f. Doesnt place a burden on anyone just spell the name
correctly. No big deal!
g. This case illustrates the importance of notice how we give
notice, whats enough (what would give a reasonable
person enough to figure out whether or not a piece of
property was encumbered or not)
h. This doctrine is about constructive notice not necessarily
actual notice.
i. Brief Fact Summary. The Plaintiff, Orr (Plaintiff), was in
possession of a judgment lien against an Elliot, which he
recorded. However, Elliots name on the lien was
misspelled. The individual sold property to the Defendant,
106

j.

k.
l.

m.

Byers (Defendant) and the lien did not show by a title

search. Plaintiff sued to foreclose on the lien.
Synopsis of Rule of Law. A misspelling of a name is a
material issue and thus the doctrine of idem sonans cannot
be applied to give constructive notice to good faith
purchasers for value of real property.
Issue. Whether the Defendant had constructive notice of
Plaintiffs judgment lien.
Held. Affirmed. The doctrine of idem sonans cannot be
applied to give constructive notice to good faith purchasers
for value of real property. The doctrine of idem sonans is
when a persons name has been inaccurately written, the
identity of such person will be presumed from the
similarity of sounds between the correct pronunciation and
pronunciation as written. Absolute accuracy in spelling
names is not required in legal proceedings and if the
pronunciations are practically alike, the rule of idem sonans
is applicable. But, the rule will not be applied where the
written name is material.
Discussion. The court focused on why a misspelling with
respect to recording a judgment lien is material. The court
ruled that to allow the judgment lien holder to prevail
would place an undue burden on good faith purchasers for
value of real property. These individuals would in reality
never be sure if the property they intend to purchase was
free of liens.

Type of Recording Acts (Will be on the

exam one set of facts, results based on
what jurisdiction.)
What does a recording statute do? It doesnt endorse the deed you dont need to record it to
make it valid. Consequentially, not recording doesnt make it invalid. So why does the 2d taker
win if the first dude didnt record or recorded late?
Fundamental point recording statutes are all about notice!
vii. Race Statute the first person to record the deed prevails, if there is two
deeds. The race statute limits the title searcher is that it limits inquiry into
matters off the record. (notice is irrelevant)

107

Example: O, owner of Blackacre, conveys Blackacre to A, who does not

record the deed. O subsequently conveys Blackacre to B for a valuable
consideration. B actually knows of the Deed to A. B records the deed from
O to B. Under a race statute, B prevails over A, and B owns Blackacre.
viii. Notice Statute if a subsequent purchaser had notice of a prior unrecorded
instrument, the purchaser could not prevail, otherwise the second deed to
be recorded wins.
1. Notice Statute protects a subsequent purchaser against prior
unrecorded instruments even though the subsequent purchaser fails
to record. Look at Page 434. The last person on scene wins
unless they were on notice.
Example: O, owner of Blackacre, conveys Blackacre to A, who does not
record the deed. O subsequently conveys Blackacre to B for a valuable
consideration. B has no knowledge of As deed. Under a notice statute, B
prevails over A even though B does not record the deed from O to B.
Shelter Rule A person who takes from a bona fide purchaser protected
by the recording act has the same rights as his grantor.
ix. Race-Notice Statute only protects a subsequent purchaser if 1. They are
without notice of the prior instrument and 2. Records before the prior
instrument is recorded.
1. Race Statute The first who wins the race to the courthouse
wins. Simple but we have problems. Injects elements of unfairness.
First one wins unless the second buyer manages to both 1) buy
without notice and 2) record before the first buyer - but he also has
to be in good faith. (most complex to apply). (Look at this further
he was kinda confusing)
Example: O, owner of Blackacre, conveys Blackacre to A, who does not
record the deed. O subsequently conveys Blackacre to B, who does not
know of As deed. Then A records. Then B records. A prevails over B
because, even though B had no notice of As deed, B did not record before
A. did.
2. Rule: if you dont record, you are telling the world you dont have
an interest. Record Promptly.
3. Messersmith v. Smith (1953) (p. 670)
a. Failure to properly notarize the deed is a failure of such
compliance. Not enough to put others (pubic) on notice.
b. It does so as a matter of equity. In order to get equitable
relief, you have to come to court w/ clean hands, and thats
what Messersmith is all about.

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c. Messersmith v Smith breaking it down, double

conveyance of mineral rights:
d. 1) Aunt -> P
e. 2) Aunt -> D
f. 3)
D records (but w/ improper seal)
g. 4)
P records
h. 5)
PvD
i. D took land for value, gets the deed notarized, then records
that shit. He took without notice, 2d in line, and 1st to
record. Hed win in whatever recordation jurisdiction you
are in. But then later P records and they sue each other. So
why doesnt D win here?
j. P says D didnt notarize properly (grantor didnt
appear personally before the notary.)
k. But D says deed is valid regardless of recordation or
notary. Which is true. BUT D wasnt entitled to record b/c
it wasnt properly sealed, so Ct said he couldnt operate as
a subsequent purchaser in good faith, and for a valuable
consideration. He didnt have clean hands.
l. o If you are going to displace a prior deed, you better dot
your is and cross your ts. You have to fully comply with
all statutes to record to get your deed to beat an existing
one.
m. Would this be diff in a pure notice jurisdiction? Last deed
always wins so long as last purchaser wasnt on
constructive or actual notice. So D wouldve won. He
should move to one of those jurisdictions.
n. Race-notice or race jurisdictions wouldve turned out the
same way D loses. Fuck him.
o. Example: O conveys to A, who does not record. O
subsequently conveys to B, who has no notice of As deed
and gives a valuable consideration. Bs deed is entered into
the records, but it is has a defective acknowledgment. B
conveys to C, who has no notice of As deed, gives a
valuable consideration, and records his deed. This is the
Messersmith case, which is it held that Bs deed is not
recorded and therefore C is not a subsequent purchaser
in good faith whose conveyance first is recorded.
p. Brief Fact Summary. The Plaintiffs, members of the
Messermith family (Plaintiffs), filed suit to quiet title to
property. The Defendants, Smith and Seale (Defendants),

109

purchased mineral rights to the property in question from

women with no title in property.
q. Synopsis of Rule of Law. The recording of an instrument
affecting the title to real estate that does not meet the
statutory requirements of the recording laws, does not give
constructive notice.
r. Issue. Whether Seale properly recorded his mineral deed.
s. Held. Reversed, the deed that Seale relied upon was
defective and thus could not give notice and is invalid. As a
general rule, the recording of an instrument affecting the
title to real estate that does not meet the statutory
requirements of the recording laws does not give
constructive notice.
t. A deed must be acknowledged. To constitute
acknowledgment, the grantor must appear before the officer
for the purpose of acknowledging the instrument and make
an admission to the officer of the fact that he had executed
such instrument.
u. Discussion. The courts analysis focused on the material
defect in the recording of the instrument. First, the court
noted that Ms. Messersmith had no title to convey to Seale.
Second, the deed Seale sought to record was defective.
Although it had the stamp of the notary, the notary had not
personally witnessed Ms. Messersmith sign the deed and
thus it was defective. In the courts decision not to rehear
the case, the court again stated that because the deed was
defective, the court could not analyze whether Seale was an
innocent subsequent purchaser entitled to protection.
4. Title abstract idea of ownership
5. Deed physical piece of paper showing ownership
6. On exam use both interchangeably.
x. Only care about a donee if they are the subsequent to the purchaser. If the
land is donated the courts dont care because the donee does not lose
anything.
Page 430 Problem:
Question #2: Elizabeth Taylor owns Whiteacre and the record title in her name. ET marries Eddie
Fisher and gives a mortgage on Whiteacre to Carol Burnett, signing the mortgage Elizabeth
Taylor Fisher. This mortgage is indeed under the name of Fisher. Subsequently ET divorces
Eddie, resumes her maiden name, and sells Whiteacre to Adam Sandler, signing the deed

110

Elizabeth Taylor. Sandler has no actual notice of the Burtnett mortgage. In a jurisdiction where
indexing is a part of the record, does Sandler prevail over Burnett?
A: Sandler wins, but why? Theres no way he could get constructive notice. No search would
come up with the Burnett mortgage.
But, argument could be that Sandler shouldve done some additional inquiries knowing that
women change their names This would be a Wild Deed.
#2b. Suppose that Elizabeth had signed the mortgage Elizabeth Taylor-Fisher and that the
mortgage had been indexed under the name of Taylor-Fisher. Would this indexing give
constructive notice to Sandler?
A; Most courts, no, Taylor and Taylor-Fisher are very different names. Track Index helps with
this, too.
#2c. Taylors landlord had obtained a judgment against Betty Taylor d/b/a Betty Taylor Jewelry.
The name Better was used in the judgment because the lease was signed that way. The judgment
created a lien on all Taylors property and the judgment was filed and indexed under the name of
Betty Taylor. Title examine did not search under the name Betty Taylor. Does the landlord
prevail?
A: Title examiner must search under diminutives. (but probably not nicknames). This is all about
what it means to give proper notice. Black Letter Rule what would a reasonable person search
under? Probably not something thats not connected to the person who you are searching for.
Problem #1 on Page 434
1. O conveys Whiteacre to A, who does not record. O subsequently conveys to B, who purchases
in good faith and for a valuable consideration, but does not record. A then records and conveys to
C. C purchases in good faith and for a valuable consideration. B records. C records. Who
prevails under a notice statute?
A: C wins under a subsequent something rule in case.
A race-notice statute?
A: C wins when A recorded, they skipped B basically.
A race statute? (this wasnt in book he asked)
A: C wins.
Problem #2:
O, owner of Blackacre, which is worth 50k, borrows 10k from A and gives A a mortgage on
Blackacre. A does not record. O then borrows 14k from B and after telling B of the prior
mortgage to A, gives B a mortgage on Blackacre. B records. O then borrows another 5k from C
and gives C a mortgage on BLackacre. C has no notice of As mortgage. C records. Subsequently,
Blackacre is discovered to be contaminated with hazardous wastes and its value plummets. O
defaults. Upon foreclosure sale, Blackacre sells for 20k.
How is 5k distributed about A, B and C?

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B is owed 14k, so C would get nothing. B is second in line to A and he knows about the
mortgage. So B gets nothing, too. A gets 5k. Everyone behind A gets nothing. Go by expectation.
C and B both expect to be second so we start with A.

Chain of Title Problems (THIS IS ON

EXAM)
Its a sequence of ownership from the sovereign to the present holder. But nobody wants to go
back that far so each state has different rules about how far back you go.
REMEMBER - Recording statutes are not about validating the deed! Its all about the notice,
bout the notice, no validation.
Ask 2 Qs when thinking about chain of title questions:
1)

When did the deed in question become valid?

2)

Would a member of the public be able to find this line?

Chain of Title Analysis:

First Step When was the Deed for each party we are looking at become operable?
Second Step Who recorded first? (In anything other than a pure notice district)
Third Step Who recorded subsequently? Helps to find the Wild Deeds.
EXAM TIP: Recording Statutes its not about remember the facts of the cases its about
whats a notice, what would a reasonable person find if you put in reasonable efforts what does
it mean to be a purchaser of value, etc. You dont need to focus on the facts of the cases as much,
or about mortgages or promissory notes.
EXAM TIP: Someone takes the land by inheritance sets off alarm bells they do not fall
under the ambit of the recording statues they get no protection. This will be on the Multiple
Choice per Dolin.
REMEMBER: As you might have imagined, statutes differ from state to state. Who is protected
depends on the wording of the statute. All statutes have this in common: Donees are never

112

protected. People that have taken the land gratis without payment are not protected. Easy
come, easy go. If you havent spent your money into this you dont get the benefit of the
recording statute. Period. Other than that, some states may differ in that they could protect
creditors or not, etc.

4. Sequence of recorded transactions by which the title has been

passed from the sovereign through all purchases to the current
owner. (In theory, you should be able to look at your land and trace
it all the way back from time immemorial, but not in reality)
Example: O conveys to A, who does not record. A conveys to B,
who records to A-to-B deed. O conveys to C, a purchaser for value
who has no actual knowledge of the deeds from O to A and from A
to B. C records. Who prevails, B or C? The issue is: Is the A-to-B
deed properly recorded so as to give constructive notice to the
world?
a. Modern jurisdictions only mandate the searching back of a
certain number of years.
b. Board of Education of Minneapolis v. Hughes (1912) (p.
677)
i. Wild Deed are not on the chain of title and do not
put you on notice. A reasonable person would not
find the chain of title in grantor/grantee index,
because the chain was broken.
ii. Purpose of recording is to give notice to the public.
iii. When you do backwards and forwards searches,
look at the sellers when they became an owner of
the house, then search forward between the year of
ownership and now any liens, judgments, sales,
life estates, leases, etc.? But if they are wild to the
chain of title, there is no way for you to find it,
unless you live in a tract based juridiction.
iv. Board of Ed of Minneapolis v Hughes in 1906, D
pays Hoerger (O) $25 for lot, received a signed
deed w/ name of grantee left blank. Then records in
1910. But then O sells lot to Duryea & Wilson for
$25 with a quitclaim deed in 1909, before D
recorded. Then P buys from Duryea, and records
earlier in 1910. So what result? D wins.

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v. A deed without a name in it is no deed at all, so Ds

deed doesnt count (but the ct says there was
implied authority to make this deed okay), so the
big Q is when this deed became operative when
he filled in his name. So D is second in line, and he
wasnt in notice because the first guy to record was
the guy who got it from the guy who got it from O.
D wouldnt have known to search for that guy.
vi. Brief Fact Summary. Plaintiffs filed suit to quiet
title to land they bought from real estate brokers.
The real estate brokers acquired land after the
Defendant and recorded the deed after the
Defendant. However, by the time the real estate
brokers had recorded, they had already conveyed
title to Plaintiff, who had recorded their deed after
the Defendant.
vii. Synopsis of Rule of Law. It was necessary not only
that the deed to the Plaintiff be recorded, but that
the deed to Plaintiffs grantor should first be
recorded.
viii. Issue. The court addressed the following issues: Did
the deed from the Hoergers to the Defendant
become operative? If so, is the Defendant a
subsequent purchaser whose deed was first duly
recorded?
ix. Held. Reversed. Defendant was the subsequent
purchaser in good faith and is protected by the
recording of his deed before the prior deed was
recorded.
x. A deed that does not name a grantee is a nullity and
wholly inoperative as a conveyance until the name
of the grantee is legally inserted. Therefore,
Defendants deed was legally inoperative until his
name was inserted. When the grantor receives and
retains the consideration for the property and
delivers the deed to the purchaser, authority to insert
ones own name as the grantee is presumed. The
deed of the first grantee must be recorded before the
deed to a subsequent grantee is recorded.
xi. Discussion. First, that the Defendant was given
implied authority to insert the name of the grantee

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to this deed, thus giving him a legally operative

document. Second, that the real estate brokers
should have recorded their deed to the lot prior to
conveying the lot to the Plaintiffs. Because they
failed to do this, the chain of title was flawed and
although the Defendant had purchased the land first,
under the recording laws, the Defendant became the
subsequent purchaser for value and was protected
by the recording laws.
c. Guillette v. Daly Dry Wall, Inc. (1975) (p. 680)
i. The defendant could have looked at the grantee and
grantor list, which is not listed by lot numbers, but
by name.
ii. Considered to be on notice if other lots from the
same grantee have restrictions.
iii. Recording statutes do not protect donees and
devisees. Most courts require a substantial amount
in consideration to enforce a property contract.
iv. Guilette v Daly Dry Wall Inc giant plot of land in
Massachusetts, plans to develop it w/ SF homes.
Subdivides and starts selling plots, with deeds that
promise all the others wont be anything but SF
homes. (developer covenanted to buyers.) But
developer forgot to put that in some of the deeds. Ps
deed had the restrictions, but Ds did not. It did
mention the plan, though, which had the SF home
restriction. D plans to build an apt bldg., and P says
fuck you. I dont want that shit. Ct says that it was
readily searchable what was in the plan, b/c it was
in the original grantors name.
v. Ct says that although SoF requires any restriction on
land to be in writing, the original guy had these
restrictions in writing, so there can be reciprocity of
restrictions here. The deed from the original guy
conveyed interests in all the other plots, the interest
being that restriction.
vi. Takeaway here is constructive knowledge
what could a diligent person have found out? This,
apparently.

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vii. Recording statues are about notice. What

would a R person search, and what would a R
person find.
viii. Brief Fact Summary. The Plaintiffs, the Guillette
family and two other families (Plaintiffs), filed suit
to prevent the Defendant, Daly Dry Wall, Inc.
(Defendant), from building a structure that was in
violation of restrictions found in Plaintiffs deed.
Both the Plaintiffs and Defendant were owners of
lots in the same subdivision.
ix. Synopsis of Rule of Law. Each of the several
grantees if within the scope of the common scheme,
is an intended beneficiary of the restrictions and
may enforce them against the others.
x. Issue. Whether the Defendant is bound by
restrictions contained in the deeds of its neighbors
in the subdivision from a common grantor, when
Defendant purchased the land without knowledge of
these restrictions.
xi. Held. Affirmed, Defendant is bound by the
restrictions imposed by the common grantor to the
subdivision. When a grantor binds his land by
writing, reciprocity of restriction between grantor
and the grantee can be enforced. A subsequent
purchaser from the common grantor, acquires title
subject to the restrictions in the deed to the earlier
purchaser. Each of the several grantees if within the
scope of the common scheme, is an intended
beneficiary of the restrictions and may enforce them
against the others.
xii. Discussion. The court ruled that even though the
restrictions did not appear in Defendants deed,
there was mention of a common plan. Because the
grantor properly recorded these restrictions and
plan, each grantee could enforce the restrictions
against others in the common plan, which in this
case was the subdivision.
xiii. Example: O, owner of Blackacre and Whiteacre,
conveys Blackacre to A by a deed that also transfers
to A an easement over Whiteacre. A records the
deed, and it is described in the index as a deed to

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Blackacre. O subsequently conveys Whiteacre to B,

a purchaser for value who has no actual knowledge
of the easement over Whiteacre conveyed to A. B
records. Is Whiteacre subject to the easement? The
issue is: Does the deed of Blackacre from O to A
give constructive notice to purchasers of Whiteacre?

d. Lewis v. Superior Court (1994) (p. 689)

i. Notice of the law suit was recorded after the P
recorded his deed. Therefore no notice, not
reasonable for a buyer to search the records every
month for new law suits filed against the land.
ii. Precedent states that one who has not yet paid full
price for the purchase of land cannot be a bona fide
purchaser and therefore cannot avail himself of all
of the protections. But applying this rule is
inconsistent with the modern view of property and
would effectively penalize those who pay cash/note
as compared to those who take out mortgages.
Therefore, P are bona fide purchasers with first
recorded title and they win.
iii. Generally, the Index is not part of the recording
system. In this case, it was.
iv. Because this rule doesnt make sense, a lot of states
are incorporating the Index as part of the recording
system.
v. Lewis was second in line, didnt have notice, and
first to record.
vi. Defendant said that Lewis didnt actually own the
house he paid part in cash and used a Promissory
Note to purchase the rest like partly owner
financed. The purchase actually hasnt completed
the purchase so the recording statute doesnt
really protect him they only protect good-faith
purchasers for value. Thus, Lewis wasnt in the
ambit of the statute. This follows the old precedent.
vii. Court overrules the old precedent. It would just be
like a mortgage on a house before paying the
monthly mortgage the debtor would have to go
check at the courthouse to see if there was any new

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liens on the property and this is unworkable/not

reasonable.
viii. Court finds that Lewis is a purchaser of value and
does fall within the ambit of the statute.
ix. Brief Fact Summary. The Plaintiffs contracted to
buy land and paid significant amounts in
furtherance of this contract. The Defendants
recorded their lis pendens, a notice of lawsuit
affecting title, one day after title to the property
vested with Plaintiffs. Plaintiffs sued to clear title.
x. Synopsis of Rule of Law. If a purchaser has already
received title by the time a lien is recorded and was
not on constructive notice at the time he received
title, he is protected.
xi. Issue. When was the lis pendens considered
properly recorded, thus giving notice to purchasers
of the land.
xii. Held. Reversed. The lis pendens was not properly
recorded until indexed, which occurred the day after
the title passed to the Plaintiffs. Any purchaser
without notice who makes a down payment and
obligates himself to pay the balance, has every
reason to believe that his rights are secure in the
property. Plaintiff had already received title by the
time the lis pendens was recorded and was not on
constructive notice at the time he received title, thus
was a subsequent bona fide purchaser for value.
xiii. Discussion. The court discussed the unique nature
of property and the specific type of reliance a
purchaser has when they expend money for a down
payment. The court was able to maneuver around
case precedent, which would have directed an
opposite result in this case, by citing to this specific
reliance and modern trends to protect buyers who
had not fully paid for the property, but had put
down payment.
5. Think about what purpose do the statutes serve?
a. Three types of notice:
i. Actual one is personally aware of a conflicting
interest. Youve actually been put on notice.
ii. Record one has notice based on a review of
properly recorded instruments (Constructive Notice)
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b.
c.

d.
e.

information is out there for everyone to see if

they want to.
iii. Inquiry notice based on a purchasers duty to
investigate relevant circumstances (Constructive
Notice) - Its lesser than constructive notice (which
means you could go and look up the actual
document with full information). Inquiry Notice
what the hell, this is weird, I wouldnt expect this
for this type of land so you should make an
inquiry (with the seller) to figure out the details
further.
In a notice jurisdiction the last to purchase, who did not
know of the previous conveyances wins.
Ask these in a Deed recording problem ask these questions:
i. Who bought first?
ii. Who recorded first?
iii. Who had notice?
Wild Deeds not connected to the original grantor, a
problem in a grantor/grantee index. Not in a lot index.
Waldorff Insurance v. Eglin National Bank (1984) (p. 697)
i. Waldorff claim was greater because it had actual
possession of the unit, which placed the bank on
constructive notice of Waldorff's interest, and
because cancellation of a debt owed by unit seller
constituted valuable consideration for the quitclaim
deed.
ii. What would a reasonable person want to know in
this case? Who is this person who keeps living the
condo, and the bank should have reduced the loan
by subtracted by the price of Waldorffs condo.
iii. P moves in (puts deposit down; doesnt get deed
yet) -> Mortgages (recorded) -> Deed to Defendant
(recorded) -> Foreclosure
iv. There was no actual or constructive notice here.
v. Court says actual possession of real estate is
sufficient notice to the world that the occupant may
have open visible and exclusive possession of the
unit at the time of the making of the mortgages.
vi. Reasonable bank wouldve asked what he was
doing there whoops.

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vii. Bank was on Inquiry Notice the random dude

living at the apartment was strange they shouldve
asked who is this dude?
viii. Brief Fact Summary. The Defendant, Waldorff
Insurance and Bonding (Defendant), took physical
possession of a condominium unit it had contracted
to purchase. Subsequent to this physical possession,
the owner of the condominium complex mortgaged
Defendants unit to the Plaintiff, Eglin National
Bank (Plaintiff). Plaintiff sued to foreclose on
Defendants unit.
ix. Synopsis of Rule of Law. Physical possession is
constructive notice to all the world and anyone
having knowledge of said possession. When
possession is open, visible and exclusive, it will put
upon an inquiry responsibility to those wishing to
acquire interest in the property.
x. Issue. Whether Plaintiff had constructive notice of
Defendants interest in the unit when it agreed to
each separate mortgage when Defendant was in
physical possession of the unit.
xi. Held. Reversed and Remanded. Plaintiff had a duty
to inquire because Defendant by physically
occupying the premises was constructive notice of
Defendants interest. Actual possession is
constructive notice to all the world, or anyone
having knowledge of said possession. When
possession is open, visible and exclusive, it will put
upon an inquiry responsibility to those wishing to
acquire interest in the property.
xii. Discussion. The court discussed that it is difficult
for a purchaser or lien holder to inquire about every
unit in a complex, but it must do so if it would like
to effectively protect its interest. Further, once a
purchaser is in actual possession, it is a fact that
becomes legally operative as constructive notice.
xiii. HYPO: If you were going to buy a Brownstone on
Charles and saw a dude sleeping on a sofa you
might want to ask who is that guy? RULE: A
situation that arises that if you were a reasonable
person, you would ask, what is going on there? I

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want further clarification. Failing to do so is at the

reasonable persons own risk. No good answer on
what should raise this its a reasonable person
standard maybe?
f. Marketable Title Acts
i. Most states have statutes that limit title searches to
30 or 40 years.

Ex. 7 p. 441
O conveys to A, who does not record. A conveys to B, who records the A-B deed. O conveys to
C, a purchaser for value who has no actual knowledge of the deeds from O to A and from A-B. C
records. Who prevails B or C?
The Q is whether the A-B deed properly recorded so as to give constructive notice to the
world? C would probably only search Os history for liens and conveyances. How could he know
about As conveyance? Does As recordation count, b/c it wouldnt give notice to C?
o If it were a tract jurisdiction, itd be easy, but if you were in a grantor/grantee jurisdiction, itd
be damn near impossible. You dont know A from Adam, so to speak.
Ex. 9 p. 446
A conveys to B by genl warranty deed. B records. A then later gets title to the land. A records
deed from O. A then conveys to C (who has no actual knowledge.) C records. Who wins B or
C?
You have a common denominator here A. A got from O. A gave to B. And A gave to C.
So it is discoverable that B was involved, so B wins. (old and busted)
o But Bs deed couldve been thought as a wild deed, b/c the title from O went to A then to C as
far as C is concerned. (new hotness)
Ex. 10 p. 447
O conveys to A, who does not record. O subsequently conveys to B, who knows of the
conveyance to A. B records. A records. Later, B conveys to C (GF, no notice of deed from O to
A. C records. Who wins A or C?
If it was between A and B, A would win. (B had notice.) But its not. And courts are split on
this.

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But btwn C and A, C was GF purchaser, and it would be easier for title searchers if you got
to stop at the dates of conveyance (and difficult to do otherwise.) C would search B and O, not
checking for A b/c that conveyance didnt happen while B held the property. It happened before
B got the property.
-

The other side is that A recorded before C, so there was notice.

Probs p. 448-49
1)

Courts are split. Moving on.

2) Assume O owns land. Each conveyance is a warranty deed. Each person is a bona fide
purchaser except as otherwise indicated. Grantor-grantee index.
a.

A conveys to B, doesnt record

O conveys to A, doesnt record

B conveys to C, who records
A conveys to D, who records. (D is on notice of As deed)
O conveys to E, who records.
Who conveys in a notice jurisdiction? E the last person to record. What if race-notice
jurisdiction? E first person to record, last to take, w/out notice w/in the chain of title btwn O
and E. (A, B, C, and D are all wild deeds.)
b.
O conveys to A, who does not record
O conveys to B, who knows of O-A deed and doesnt record
O conveys to C, who doesnt record
B conveys to D, who doesnt record (D knows of O-B deed)
A records.
B records.
D records.
Who wins in a notice jurisdiction? D he took without notice of the deeds outside of O B,
which is his chain of title. Race? A first to record. Race-notice? First to record, last to take
w/out notice (C cant win b/c didnt record, B cant win b/c on notice, and D cant win b/c A
recorded first.)
3)
O sells to A on 6/1/05. A mtgs to B. A mtgs to O subordinate to Bs mtg. mtg from A to O is
recorded 8/1, deed from O to A recorded 8/15, and mtg from A-B recorded 8/30. Deed dated
6/1/05. Then, C buys the prop 1/1/06, Is C bound by mtg from A to O?

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a.
Q is that deed recorded after mtg was recorded, does that make it not effective on the
subsequent title? No. of course not. C would find the mtg b/c it happened after the land conveyed
on 6/1/05.

LAND USE CONTROL

a. Private Land Use Controls: the Law of Servitudes
i. Servitudes the right of person A to exercise some right over person B,
usually Bs land. A Servitude is when you make someone elses land serve
you. Its your right to exert some level of control over someone elses
land. Usually the benefit is not to a person but to the land. Often these
types of arrangements are reciprocal.
ii. Types of Servitudes:
1. A is given the right to enter upon Bs land (right of way)
(Easement)
2. A is given the right to enter Bs land and remove something
(removing minerals) (Profit)
3. A is given the right to enforce a restriction on the use of Bs land
(your neighbor cant develop her land commercially) (Negative
Easement OR Real Covenant OR Equitable Servitude)
4. A is given the right to require B to perform some act on Bs land
(maintain a fence) (Real Covenant OR Equitable Servitude)
5. A is given the right to require B to pay money for the upkeep of
specified facilities (a swimming pool available to residents) (Real
Covenant OR Equitable Servitude)
iii. Easements
1. Easement is an interest in land and subject to Statute of Frauds. It
generally has to be in writing. We must have some sort of
document that shows the owner acquired the land. Doctrines of
prior performance and estoppel also apply.
2. Easements can be either positive or negative. They can be either
appurtenant (they benefit the land) or in gross (not attached to any
land at all; they benefit a person).
3. Affirmative (Positive) (appurtenant) the right of the other party
to make some specific use or affirmative act on land owned by
someone else (vast majority of easements are affirmative).
Affirmative easements attach to the land and gives the right to the
land owner. If the type of easement is unclear, the law construes in
favor of affirmative.

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4. Negative (Restrictive) (in gross) the right of other party to

restrict some particular use. These do not attach to the land and are
personal and cannot be transferred.
5. If the owner of a dominant estate buys the land of a servant-estate,
the easement is extinguished. If the dominant estate later sells this
the easement comes back into play. You cannot have an easement
on your own property doesnt make sense, right?
iv. There is the dominate estate (the one who benefits from the easement) and
the servient estate (the land that is subject to the easement). We have a
dominant estate and the servant estate. The subservient estate is the one on
which the easement is located. The dominant estate is what benefits from
the easement.
v. Assignability of easement in gross: The benefits and burdens of
appurtenant easements pass automatically to assignees of the land to
which they are appurtenant, if the parties so intent, and the burdened party
has notice of the easement. Where the benefit is in gross, however, the
benefit may not be assignable. (Modern view is any easement in gross is
assignable if the parties so intend). Estate in gross is personal not
attached to land. It can be sold/transferred, but it simply means its not
attached to any particular piece of land.
vi. Creation of Easements
1. Easements can be created by implication and by prescription (by
adverse possession).
2. Absent a writing:
a. 1) prior performance
b. 2) estoppel
c. 3) implication; and
d. 4) prescription
3. SoF applies, unless there is fraud, partial performance, and
estoppel. Also an easement can be created by implication or
prescription.
4. Easement is created by a written instrument signed by the party to
be bound thereby.
5. Willard v. First Church of Christ (1972) (p. 768)
a. Under common law one cannot reserve an interest in
property to a stranger to the title (third party), due to Court
mistrusted and wanted all interests to be conveyed by deed
as a substitute for livery of seisin.
b. McGuigan sold the land with an easement for the Church to
park there. Her deed is recorded.
c. Willard omits the easement language from his Deed. His
deed is recorded.
d. Willard honestly didnt know about the easement.
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e. Common law rule: one cannot reserve an interest in

property to a stranger to the title. The Church is a stranger
(third party) to the title.
f. Willards argument wouldve worked back in the feudal
days. Not so much now. Holding to this old rule would
provide for an inequitable result because the original
grantee has presumably paid a reduced price for title to the
encumbered property. Thus, Church gets to park their cars.
g. Willard did not read Petersons deed and had notice that the
church was using the land.
h. Holding to the old rule produces inequitable results because
the buyer presumably paid less for the encumbered land
than he would have otherwise. To let him attack the
encumbrance later is to confer an unfair benefit.
i. We must balance the injustice which would result from
refusing to give effect to the grantors intent, if any, which
might result by failing to give effect to reliance on the old
rules and the policy against disturbing settled titles.
j. Brief Fact Summary. The Plaintiffs, Mr. and Mrs. Willard
(Plaintiffs), sued to quiet title regarding an easement they
did not believe existed on the property. The Defendant,
First Church of Christ, Scientist, Pacifica (Defendant),
contended that they were granted an easement, which was
in the deed prior to the conveyance to the current owners.
k. Synopsis of Rule of Law. A grantor may in a deed to real
property, reserve an interest in that property for third
parties.
l. Issue. Whether a grantor may, in deeding real property to
one person, reserve an interest in that property for a third
party.
m. Held. Reversed. The court abandoned the old common law
rule of rejecting conveyances that vest interests in third
parties and held that in the case, such a reservation vests the
interest in the third party.The courts primary objective in
construing a conveyance is to give effect to the intent of the
grantor and is to be interpreted in the same way as other
contracts.
n. In order to determine whether a court should apply the old
common law rule to grants made prior to the courts
decision, a balancing of equitable and policy considerations
must occur. The court should examine the injustice of
refusing to give effect to the grantors intent versus the
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result of failing to give effect to an individuals reliance on

the old common law rule and policy against disturbing
settled titles.
o. Discussion. The court discussed why the old feudal rule of
rejecting any reservation in land that vested rights in third
parties was no longer applicable and in the end, frustrated
the grantors intent. The court found that the grantor clearly
intended to vest an interest in the property to the church
and that the Plaintiffs were not at a bigger injustice with
this decision to forego the old rule which would have
rejected the conveyance to the church.
p. HYPO: What if Willard said he wasnt on notice? His Deed
didnt say anything about the easement, he doesnt see the
cars parking on Sunday so he just didnt know about it.
Would this argument be successful? No, He couldve done
a title search he shouldve research this and wouldve
been on notice that his deed does not include the
encumbrance due the church. Thus, he was on constructive
notice.
q. HYPO: What if California had decided to enforce the old
rule of not being able to reserve an interest in a third
property. How can you get the same result as McGuigan
wanted? Could convey fee simple to the Church and have
the Church convey fee simple, minus a reservation to
themselves and this is permissible under the old rule.
6. Today, can create an interest in a third party, as long as all parties
have notice.
7. Reservations/Exceptions now mean the same thing
8. Licenses vs. Easements
a. An easement is not revocable, while Licenses are.
b. Willard tried to argue that the Church had a license and not
an easement. Whats the difference? You cant revoke an
easement and you can revoke a license at will. Licenses
dont have to be recorded or written down.
c. Example: Its a license for us to park at the Fitzgerald
garage they can revoke that right at any time and we cant
do anything about it.
d. When a licenses becomes irrevocable it becomes an
easement.
e. Easements are real interest in property, while licenses are
not.

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f. A license is an oral or written permission given by the

occupant of land allowing the licensee to do some act that
otherwise would be trespass.
g. Examples: Plumber to fix a drain; guest coming to dinner;
purchaser of a theater ticket.
h. Exception to Rule that License is Revocable: 1) License
coupled with an interest cannot be revoked (incidental to
ownership of a chattel on the licensors land) Example: O
grants to A the right to take timber from Blackacre, owned
by O. A has an interest (a profit) and an irrevocable license
to enter the land and take the timber; and 2) a license that
becomes irrevocable under the rules of estoppel (treated as
an easement).
9. Kienzle v. Myers (Page 496)
a. A property owners reasonable reliance on an adjacent
owners permission for use ripened into an easement by
estoppel
b. (neighbor wanted to connect sewer line to street, but
neighbor said just use mine, don't' waste the money on your
own line)
c. An easement by estoppel may be found when an owner of a
property misleads or causes another in any way to Rx
change the other's position to his or her prejudice and
detriment to restore
d. A property owners reasonable reliance on an adjacent
owners permission for use ripened into an easement by
estoppel
e. An easement by estoppel may be found when an owner of
one property misleads or causes an owner of another
property to detrimentally rely on something you said or
did and then changes positions to their own detriment.
f. When an owner of land, without objection, permits another
to expend money in reliance upon a supposed easement,
when in justice and equity the former ought to have
declared his conflicting rights, he is estopped to deny the
easement.
g. If the two parties involved had simply signed a license, the
court wouldve enforced it as a license, rather than an
easement.
h. Also, the Kienzle property may be worth less because
theres a pipe under their land that lowers the value

127

maybe whereas this can increase the value of Myers

land
i. Court wants to make sure people are paying for what they
are getting.
j. The Ohio Rule is the majority Rule
k. An easement by estoppel is created when: where an owner
of land, without objection, permits another to expend
money in reliance upon a supposed easement, when in
justice and equity the former ought to have disclaimed his
conflicting rights, he is estopped to deny the easement.
l. No requirement in common law that a property owner must
mislead or misrepresent.
10. Van Sandt v. Royster (1938) (p. 779) implied easement by prior
use.
a. The sewer was installed for the benefit of all lots owned by
Bailey. The court has trouble because you cannot have an
easement in your own property. The court looks at qusieasements for the benefit of the property.
b. An easement can be implied in favor of either grantor or
grantee on the basis of necessity alone.
c. Van had notice of easement the property had modern
plumbing. One would think that since plumbing exists it
must connect to a sewer and his neighbors are doing the
same, reasonable assumption.
d. As an easement is an interest which a person has in land in
the possession of another, it necessarily follows that an
owner cannot have an easement in his own land. However,
an owner may make use of one part of his land for the
benefit of another part, and this is frequently spoken of as a
quasi easement. Example: A farmer farmhouse and
growing crops.
e. When a quasi-easement is granted it becomes a full
easement and vested in the grantee. Why? When you buy a
house and to honor the expectation of the bargain the
easement is vested in the grantee. Grantee rightfully
expects that the working toilet, connected to the main line
sewer system, will continue to work as before and enjoy the
benefits that the Grantor enjoyed. (Basically Bailey enjoyed
the easement so the buyer should enjoy the easement,
right?)
f. Courts say quite a few things on this issue - Kansas is the
majority view however.

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g. Plaintiff shouldve been on inquiry notice based on the

facts and thus he cant prevail on these facts
h. In Royster case the house owner paid more for the house
because it had access to the sewer/had working systems,
etc. This was what he negotiated
i. Brief Fact Summary. The Plaintiff, Van Sandt (Plaintiff),
discovered that his basement was flooded with sewage and
brought an action to enjoin the Defendant, Royster
(Defendant), from using and maintaining the underground
sewer. The pipe crossed a single property encompassing
both lots and the adjacent lot in 1904 that was owned by
Bailey.
j. Synopsis of Rule of Law. An easement is implied to protect
the probable expectations of the grantor and grantee that a
prior existing use will continue after the transfer. Thus,
where the grantee is aware of a reasonably necessary use of
the grantees property for the comfortable enjoyment of the
grantors property an easement by implication is created.
k. Issue. Is there an apparent easement even though the sewer
drain pipe is not readily visible?
l. Can a common owner make use of part of his land for the
benefit of another part, thereby creating a quasi-easement,
which creates an easement by implied reservation upon
severance of the servient estate from the dominant one?
m. Held. An apparent easement existed. An easement need not
be visible to be apparent. Appliances connected with and
leading to the property were obvious adaptations of the
property that led to a sewer. The Plaintiff purchased the
property upon careful inspection and knowledge that the
property had modern plumbing. Plaintiff was thus charged
with notice of the sewer.
n. An easement by implication was created. The easement was
necessary for the comfortable enjoyment of the grantors
property (Bailey, the common owner, installed the
plumbing for the benefit of all three lots). If the land cannot
be used without disproportionate effort and expense an
easement may still be implied in favor of the grantor or
grantee on the basis of necessity alone. The original
purchaser was aware of the sewer and thus there were
reasonable expectations concerning the prior existing use.
o. Discussion. The court follows the Restatement of Property
factors rather than the common law rule of strict necessity.
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11. Easements can be created by implications by the behavior and

intent of the parties.
12. If one person bought all three lots than the easement would
disappear, because you cant have an easement in your own
land. If three lots sold again, the court will look the circumstances
of the transaction.
13. Implied Easements
a. 2 way to imply an easement 1) prior use (quasieasement) or expectations and 2) necessity.
b. How does Necessity work?
c. Parcel was landlocked cant leave without trespassing on
someone elses land. However, theres a path through one of
the other lots. Plaintiff argues its by necessity since he
has to be able to access the road. Is this necessity? Are the
requirements satisfied?
d. Necessity is not something of mere convenience it must
really be necessary. It also must exist at the time that the
parcel in question was created. Because then the buyer of
the parcel that encloses the landlocked parcel must be on
notice they will realize that the other owner must access
the road through their land must have full awareness of
what they are buying.
e. Must show 3 conditions are satisfied: easement by
necessity
i. 1) Must show that at some point in time there
used to be a unity of the dominant estate and the
servient estate (all was owned by same person in
one land);
ii. 2) Must show that the ingress/egress roadway is
indeed an absolute necessary not simply a
convenience. If there is any other way to get out,
then you dont have necessity (like a river/lake
entrance) MODERN VIEW IS MORE
RELAXED THAN THIS;
iii. 3) (most important one) Necessity must exist at
the time that the estates were split because then
the people buying the parcels would be on notice
for the easement if it arised afterwards the
buyer may have no idea (makes sense!)
f. Othen v. Rosier (1950) (p. 786)
i. Othens cannot claim prescription or AP because he
did not show that his predecessors AP was in the

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same place and within the definite lines claimed by

Othen.
ii. There must have been a unity of dominant and
servient estates at some point
iii. The roadway is a necessity and not a mere
convenience. Grantor would preserve the right of
ingress/egress to himself otherwise would be
completely useless.
iv. The necessity must have existed at the time the
estates were split and not have arisen later.
v. P failed to show that at the time of initial
conveyance to D there was a necessity for H to
access the roadway. Also, no easement by
prescription because the use was not exclusive.
vi. The necessity doesnt arise until long after the
estates are split.
vii. Othen failed to show that necessity excited at the
time the dominate estate was split from other
estates.
viii. If an easement by necessity once the necessity is
gone, the easement is gone as well. So if another
road is built on Othens other side, the necessity will
be extinguished
ix. Why do we allow this? Because we are trying to
honor the expectation of the parties that they had at
the time they entered the transaction.
x. Goes back to underlying policy of property we
dont want land to lie around fallow we prefer
land to be put to good use and if you cant get
to/from land, you cant get any use out of it.
14. Easement by Prescription
a. Similar to AP but refers to the use of the land. Based on the
idea that rights can be acquired by the passage of time.
15. Scope of Easements
a. Brown v. Voss (1986) (p. 820)
i. As a general rule, an easement appertunant to a
certain parcel cannot be unilaterally extended to
benefit another parcel. Therefore, P cannot use the
easement to benefit his newly acquired parcel.
ii. Court says an easement created by an express
instrument there is an actual document that
reflects what you are actually buying the rights

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iii.

iv.

v.

vi.
vii.

viii.

ix.

x.

conferred are to be determined from the language of

the instrument which makes perfect sense.
The Deed of this easement grants those rights to a
particular piece of land and not to any other piece of
land. So it was granted for the benefit of Lot B and
not Lot C.
The easement is appurtenant to the Land itself its
not meant to benefit the land owner but the land
itself. An easement appurtenant to the land itself
cannot be appurtenant to another parcel. This
doesnt depend on the benefit or the amount of use
or the cost, etc. Even if the type of use or amount
of use is unchanged.
Ultimately the Rule/Question here is: What are the
rights of the respective parties what did they agree
to what were their expectations? Its not a
question of what are the burdens on the servitude.
Plaintiffs cannot use the easement to benefit the
newly acquired Lot C parcel.
Review of Injunctive Relief and should the trial
court have awarded it? Basically they win but the
court wont enforce it, so whats the point?
Brief Fact Summary. The Browns (Plaintiffs)
brought an action to remove obstructions placed on
a private road access to their properties parcel B and
parcel C. The Voss family (Defendants) owned the
servient estate, parcel A on which there was private
road easement to access the dominant estate, parcel
B. Defendants sought to prevent Plaintiffs use of
that easement because the road was being used to
access a third piece of property, parcel C, that was
not part of the dominant estate.
Synopsis of Rule of Law. Based on the equities,
Plaintiffs would not be enjoined from using the
easement to access parcel C, although it was a
technical misuse of the easement which by express
grant only to gave access the residence on parcel B.
Issue. Whether the holder of a private road
easement can cross the servient estate to access both
the dominant estate and an additional estate that was
acquired later if the two estates are used in such a

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way that there is no increase in burden on the

servient estate.
xi. Held. The Supreme Court of Washington agreed
with the trial court and held that no injunction
should issue based on the equities. Since the trial
court found that there was no increase in burden on
the servient estate since it was being used for the
same purpose, and the Plaintiffs acted reasonably in
the development of the property, the trial court
acted within its discretion to deny the injunction,
even though it was technically a misuse of the
easement to access parcel B expressly.
xii. Discussion. Nondominant property may also enjoy
use of an easement, although technically improper,
if it is found to be the more equitable solution in a
proceeding for an injunction, which is based on the
discretion of the trial court.
xiii. HYPO: Reverse of Voss Case example. Lots A and
B, which eventually got divided into B1 and B2.
Can both of those use the easement now? We would
have twice as much traffic no good answer. Its
the nature of the dominant estate that governs the
easement. Yes, subdivision would allow both to use
the easement
16. Termination of Easements (Easements in Gross) (Didnt go into
much)
a. Easement to swim in a lake; easement to boat.
b. HYPO: What happens if Dolin receives an easement to
swim in my lake? Can he split the easement to others? Yes.
But, in order to limit to the intentions of the parties
however many ways I split it, however many owners they
end up being The One Stop Rule/Non-Divisibility Rule.
They must use this easement together or not at all.
Basically they must agree among themselves as if they are
one person similar to tenancy by the entirety
c. Preseault v. US (1996)
i. The railroad was on an easement which ended and
the Government must compensate under the 5th, for
taking the land to use a rail-trail.
ii. The use as a public path is far what the original
easement was for, the uses are clearly different. To
spite what the govt argues that a railroad and a trail
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iii.

iv.

v.

vi.
vii.

viii.

ix.

x.
xi.

serve the same function. The burden has changed

from the railroad and greatly increased.
Furthermore, when the RR pulled up the tracks it
abandoned its easement. While mere non-use is not
abandonment, acts that clearly manifest either a
present intent to relinquish an easement or a
purpose inconsistent with future use, there is
abandonment and the easement is extinguished and
any trails would be an entirely new easement.
If you commit acts that clearly manifest your
present intent to abandon that would be enough.
By pulling up the tracks, the Railroad/Government
indicates that they do not intend to continue using
the parcel for trains and thus abandon the
property. Once this happens, the easement is
extinguished automatically just like necessity.
Once the easement is done its gone. If they
wanted to lay new tracks and start again theyd
have to get a new easement start from scratch!
Its not about pulling up the tracks its the
manifestation that you are abandoning. If you are
merely replacing old tracks with new tracks
doesnt county as abandonment.
Foundational aspects of case>
1) An easement may be adjusted with time but
such an adjustment has to be consistent with the
initial purpose of the easement.
2) When easements are abandoned, they are
extinguished. Just like necessity. They can also
expire under express terms or owner could release
the servient estate. By document, selling it back,
etc.
3) The government may take your property but if
they do under Constitution they must
compensate you for it. When they take an easement
over your property, the Govt. has to compensate the
owners. Even $1
4) Once an easement is extinguished, its GONE>
Brief Fact Summary. Congress enacted a Rails-toTrails Act to make public recreational use out of
discontinued railroad rights of way. The Plaintiffs,
J. Paul Presault and Patricia Preseault (Plaintiffs), as
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xii.

xiii.

xiv.

xv.

xvi.

fee simple owners of the land over which the tracks

formerly ran, claimed that the conversion of the
property was a taking by the Defendants, the United
States (United States).
Synopsis of Rule of Law. A public recreational trail
was not within the scope of an existing easement for
railroad purposes. Therefore, the conversion to
public recreational trail was a taking of a new
easement for a new purpose, for which the
landowners are entitled compensation. In addition,
since the easement was abandoned, the opening of
the public recreational trails was also a physical
taking of the Plaintiffs property rights.
Issue. Did the Railroad acquire only an easement or
a fee simple estate in the railroad right of way? If it
acquired an easement, was the easement limited to
railroad purposes only or was it broad enough to
encompass future use as public recreational trails?
Had the easements terminated by abandonment
prior to the taking for public recreational trail use?
Held. Under Vermont property law, the estate
acquired by a railway is no more than is needed for
the railroads limited purpose and that typically
means an easement not a fee simple estate.
Since the easements are limited as a matter of law to
railroad purposes, the Court could not find that the
scope of easement would encompass a public
recreational trail. Vermont recognizes that simple
non-use does not extinguish an easement,
something more is needed such as conduct by the
owner manifesting a present intent to relinquish the
easement or a purpose inconsistent with future
existence. However, removal of the tracks and
equipment was inconsistent with future existence
and no attempts were made to reconstruct. The
limited collection of licensing fees for crossing was
not enough to defeat the abandonment.
Discussion. The court looked to Vermont Property
law to determine the scope of the easement even
though the title contained fee simple language. The

135

d.
e.

f.

g.

case law limited the scope of the easement to

railroad purposes.
Easements can be adjusted as time passes; the purpose
needs to remain the same
Once an easement is abandoned, it is destroyed. Purpose
inconsistent with easement or obvious abandonment. Must
be shown by clear evidence.
Easement once destroyed when all lots are owned by the
same person, easement has to be created again by the
subsequent owners when the property is divided again.
Methods for terminating easements: 1) Release (writing
normally required); 2) expiration; 3) end of necessity; 4)
merger; 5) estoppel; 6) abandonment; 7) condemnation
(government takes over using eminent domain); and 8)
prescription.

Problem 4 (Page 515)

Easement by necessity arises once A purchases Lot 4 (it landlocks Lot 5). Once A purchases Lot
5, the easement of necessity is extinguished. Once A dies, the Lots are all divided again.
Easement by necessity again? Yes, all of the conditions are met. Interesting question is but
where? Lot 4, Lot 3, or Lot 1? Point of the question is NOT to say that the easement is on Lot 4
thats not true. You start from scratch once the second easement comes into play.
Problem 5 (Page 515)
An easement by prior use wont be extinguished if the necessity is taken care of. Basically, if X
cuts the pipe going to C, and instead runs the pipe North/South, the nature of the prior use isnt
changed and the easement remains. Remember this good exam question easement made
from prior use is not extinguished even if the easement is no longer necessary. It remains prior
use since its in the past.

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Negative Easements (Covenants)

A) Four types:

* The right to stop your neighbor from: 1) Blocking your windows; 2) Interfering with
air flowing into your land in a defined channel; 3) removing the support of your
building (usually by excavating or removing a supporting wall; and 4) interfering
with the flow of water in an artificial stream.

Difference between Easements/Covenants, etc.: Easements are often known as a real interest in
someones land. Literally someone else can do something on your land.
When you analyze these problems is the promise being made to the land or to the individual? Is
it ancillary to any land transaction?
e. Covenants
i. Covenants are promises made on your own land to the benefit of your
neighbors. The neighbors are likely to pay for the promises, because he
values those promises (not building a skyscraper so the neighbor can keep
his view, neighbor will pay $200,000). While easements are about rights
on anothers land.
ii. Covenant is a fancy legal word for a serious promise. A promise from an
owner of a parcel to do or not do something. These promises may be
beneficial to either one or both parties involved. Ex. A promises X not to
raise pigs on his own land. This arrangement involves both the promisor
and the promisee will want to enforce this agreement onto their
successors. If you are going to pay me to not raise pigs, you want to
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iii.

iv.

v.

vi.

vii.
viii.
ix.
x.
xi.
xii.

ensure that me and my successors are bound by this promise. Both parties
want to inforce the agreement
How do you enforce this? Is to make the promise a property right a
property right can pass on from generation to generation or buyer/seller.
This is the fundamental nature of property. By passing on a fee simple
absolute, the buyer gets all of the burdens and the benefits of the property.
How do we convert a traditional contractual obligation into a property
right? Rely on privity of estate which we reviewed before. One way we
do this:
HYPO: Dolin owns a big piece of land; at some point he sells a corner to
Ricky. As part of the sale, Dolin promises not to raise pigs on his land
connecting. This promise was made not because Dolin was nice but as part
of a transaction to buy and sell this piece of land. There used to be privity
of estate and A buys the parcel from Dolin so we have privity.
History
1. Covenants are a way to enforce a negative easement through
contract, on the buyer and all successors.
Privity of estate enforceable contract between buyer and seller.
Burden end and a benefit end. If I promise not to raise pigs, I am
burdened by this promise. Dolin is benefited from my promise.
The burdens and benefits do not necessarily descend in the same way.
The test for the burden to run is more onerous than the test for the benefit
to run. Intuitively, this makes sense.
This test has to do with privity of estate; but as you can imagine, there are
two types of privity:
1) vertical privity; and 2) horizontal privity
1. Horizontal privity privity of estate between the original
covenanting parties; Horizontal privity is privity of estate between
the original contracting parties. This only exists when the covenant
is made in connection with a sale of estate. The inquiry is the
privity of estate, not the privity of contract.
2. Vertical privity privity of estate between one of the covenanting
parties and a successor in interest.
a. Burdens and benefits dont run the same way. Horizontal
and vertical privity is required for the burden to run. But
neither is needed for a benefit to run.
b. Ways to get around privity and burdens - Straw man can be
used, convey both lots to a third party, then the third party
conveys back to A and B with the restrictive covenants in
place.

138

c. This seems to work in almost every case, except in one

case adverse possession. This one is easy to satisfy
just look for adverse possession otherwise you have this.
d. So whats the point here? Traditional Rule is that both
horizontal and vertical privity are required for the burden to
run. A burden will run if and only if both the horizontal and
vertical privity are satisfied. But the benefit will run if the
vertical privity is there but doesnt need the horizontal.
Thus, it is easier to find a benefit instead of a burden.
xiii. In addition to privity requirements, there are other requirements:
1. Intent: The original contracting parties must have intended to bind
successors to their respective estates (language in document
satisfies this requirement)
2. Touch and Concern: The promise must relate in some way to the
enjoyment, possession, or use of the affected land rather than being
of personal concern to the original contracting parties. Most
problematic covenants are affirmative covenants involving the
payment of money.
3. Notice:. Covenants are not enforceable without notice can be
constructive or actual notice.
xiv. A real covenant can be a negative promise (a promise not to do an act) or
an affirmative promise (a promise to do an act). A covenant is not
enforceable against an assignee who has no notice of it.
xv. Real Covenant is one that runs with the land based on operation of law.
Means more than a mere contract between individuals. It runs not with A
but instead runs with the land. A can sell it to B, C or D doesnt matter.
xvi. In order for a Covenant to be a real covenant the promise in question the requirement must touch and concern the land involved.
xvii. The promise must relate in some way to the enjoyment, possession or use
of the affected land rather than being of personal concern to the original
contracting parties.
xviii. Covenants Enforceable in Equity: Equitable Servitudes
a. Equitable Servitudes are enforceable by equity for
injunctions not money. (look at this entire section again)
b. Most states have merged the courts of law and equity. You
must ask for both you cant forget this but you can them
all at the same time, in the same courthouse.
2. Tulk v. Moxhay (1848) (p. 854) (English Case)
3. An equitable servitude is enforceable by an injunction, and is a
covenant respecting the use of land enforceable against successor
owners or possessors in equity regardless of its enforceability at

139

law. Equity requires that the parties intend the promise to run, that
a subsequent purchaser have actual or constructive notice of the
covenant, and that the covenant touch and concern the land.
Horizontal privity of estate is of no importance in equity. Nor is
vertical privity required for the burden to run. All subsequent
owners and possessors are bound by the servitude, just as they are
bound by an easement.
4. Equitable Servitudes are enforceable against successor who give
no consideration (donees, heirs, will beneficiaries, etc.), whether or
not they have notice.
5. Real Covenant vs. Equitable Servitude: Look at the remedy that
the plaintiff is seeking the remedy for breach of a real covenant is
damages in a suit at law the remedy for breach of an equitable
servitude is an injunction or enforcement of a lien in a suit in
equity.
6. Covenant: keep the space open and in good repair.
7. If the court adopted Defendants argument, then no one would
honor covenants people would sell the land to straw
buyers/dummy corporations to get around the covenant
requirements.
8. Equity is like Mom when Dad says no you run to Mom.
9. If an equity is attached to the property by the owner, no one
purchasing with notice of that equity can stand in a different
situation from the party from whom he purchased
10. Brief Fact Summary. The Plaintiff, Tulk (Plaintiff), had sold
Leicester Square by deed containing. The Defendant, Moxhay
(Defendant), a subsequent purchaser sought to build upon the land.
Plaintiff brought a bill for injunction.
11. Synopsis of Rule of Law. Since a covenant is a contract between
the vendor and the vendee, it may be enforced against a subsequent
purchaser who has notice of the contractual obligation of his
vendor, even though it does not run with the land.
12. Issue. Can a covenant restricting a property to a specific use be
enforced against a subsequent purchaser?
13. Held. Whether or not the covenant runs with the land, such an
agreement could properly be enforced in equity because the one
who purchases the land from Tulk had notice of that covenant.
Defendant, Moxhal could not stand in a different situation from the
owner from whom he purchased the property.
14. Discussion. An equitable servitude is enforceable by injunction
with no regard to privity, so long as the promise is intended to run

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and the subsequent purchaser has actual or constructive knowledge

of the covenant.
15. In order to seek the protection of equity, some rules have to be
satisfied;
a. 1) must show that the initial parties to an agreement
intended a promise to run with the land;
b. 2) subsequent purchaser must have notice; (if donee, dont
care about notice after all, you got the land for free)
c. 3) Covenant must touch and concern the land (must be
about the land) similar to real covenants)
d. All of these requirements have to do with a sense of
fairness.

Page 542: Problems

1 A and B, neighboring landowners, decide that they will mutually restrict their lots to single
family residential use. They sign an agreement wherein each promises on behalf of herself, and
her heirs, and assigns, that her lot will be used for single family residential purposes only. This
agreement is recorded in the county courthouse under the name of each signer. B sells her lot to
C. C builds an apartment house on his lot. A sues C for damages. What result?
Answer: C would win; there was no horizontal privity between A and B the burden to abide by
this agreement does not run to C. This was like a naked promise.
Hypo: Everything as before, but suppose A builds the house. Now C sues for damages. What
result? Answer: C would win; the benefit runs because C can show veritical privity and the
burden runs because A is still the holder of the land. See how unequal it can be? At law, C is free
to do what he wants. The law is harsh
You could get around this how would A do it? He could sell the land to a family friend and
purchase it back shattering the horizontal privity. This could work at law but equity rules
were designed to get around this problem actually
Problem #2:
O, owner of a two-acre parcel, divides that parcel and conveys one acre to A, keeping the other
acre herself. The deed, properly recoded, includes mutual covenants by A, on behalf of herself,
her heirs and assigns, and O, his heirs and assigns, that the conveyed and retained parcels will be
used for residential purposes only. Later, B takes As parcel by adverse possession and opens a
restaurant on the premises. O brings an action against B for damages for breach of the covenant
that A made. What result under traditional rules?
Answer: O is trying to impose burden on B and to do that he needs to show that there was
horizontal privity and he must also show that B took from A in a vertical privity sense but he
did not. Because B is an adverse possessor, we cannot
If you are an adverse possessor and you take the land but you dont get any benefits of the
bargain which you didnt bargain for so you only get the land, really. Not in the chain of
title
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Problem 3:
Same facts as #2, suppose that instead O leased her parcel to C for five years. A opens a nursery
school on her parcel. C brings an action against A for damages for breach of the covenant. What
result under traditional rules?
Answer: Under modified traditional rules, the lease doesnt shatter the privity. We have both
horizontal and vertical privity here so should work
So focus on who took what from whom look at the privity etc.

Zoning

1. Introduction
a. Zoning Power. Only the state has the power to zone. This power has been
delegated to cities and counties by statute called enabling statutes. Hence, all
local zoning activity must abide by the enabling statutes.

Law of nuisance was the ability for a private landowner to sue another private landowner to do
lawful activities but just in the wrong place (a gas station in a completely residential
neighborhood). Its not unlawful, just inappropriate.
b. Goals of Zoning. Zoning has as its goal the orderly development of the
community. It promotes economic growth, community health, welfare and safety.
c. How Zoning Works. One of the fundamental characteristics of zoning is that it
segregates uses of land into geographic regions. Thus, high rises may only be
permitted downtown rather than in rural areas. It can be used to foster commercial
districts as well as residential districts. For health and safety reasons, zoning can
regulate the density of human population. This can be achieved by limiting building
heights, providing for minimum and maximum yard sizes, yard setbacks, etc.
d. Constitutional Considerations. As with other areas of the law, zoning is affected
by the Constitution. For instance, if the zoning in an areas is going to be changed,
due process requires that the landowners in the area be given a hearing. Zoning
restrictions must be for a legitimate governmental objective. The Equal Protection
Clause requires that all landowners who are similarly situated be treated equally,
unless there is a legitimate reason for not doing so. Of course, as with eminent
domain, if zoning regulations amount to a taking, just compensation must be given
by the State.
1) Taking. The local government properly exercising its police power when it phases
out uses that are inconsistent with newly enacting zoning changes. For example, a
city can change the zoning where a cement plant is located and give the plant a

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couple of years to move before it will be cited for violation of the new zoning. A use
that, due to a zoning change, is no longer permitted is a nonconforming use. Most
courts say that that the landowner must be given a reasonable time to cease his
nonconforming use. The length of time for ceasing the nonconformity may be based
on the dollar value of the improvements of the land.
Leading Case Village of Euclid v. Ambler Realty Co

The ordinance under review and all similar ones must find justification under
the police power of the state asserted for the public welfare.
IF the validity of the legislative classification for zoning purposes is fairly
debatable, the legislative judgment must be allowed to control.
It is reasonable for a legislature to regulate the building to avoid nuisances
and promote safety, and if some harmless type of building is also excluded,
this will not invalidate an otherwise good law.
Complete restriction of all industry and apartment buildings from a purely
residential district is proper in that fire and health protection is thereby more
fairly suited to the task, traffic congestion and street accidents are reduced,
and a safer, cleaner and more enjoyable place for detached housing
development is provided. Apartment buildings and industry, taken as a
whole, would negate these benefits.
If the provisions of a law are applied to a specific property, they may be found
to be arbitrary and unreasonable. The Court will not examine each line of the
ordinance and enjoin the enforcement if no injury is shown other than a
general allegation that property values were affected.
In the development of Constitutional Law, the Court will not speculate with
general rules beyond the immediate question presented.

Comment: Basically, zoning laws are now presumptively valid.

2) Administration of Zoning Ordinances

a) Introduction. Zoning ordinances present numerous opportunity for abuse and for
objection by affected landowners. Administration of zoning ordinances thus creates
the potential for considerable litigation.
b. Comprehensive Plans. Enable acts inevitable require the local zoning authority to
adopt a comprehensive plan (which can be revised from time to time). The zoning
must conform with the plan. The plan serves to limit the local zoning boards whims.
c. Nonconforming Use Lead Case PA Northwestern Distributors, Inc. v. Zoning
Hearing Board

Class Review of PA Northwestern Distributors, Inc. V. Zoning Hearing Board Case

Can zoning affect already existing use?

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Generally speaking we presume the zoning regulations are valid. You cannot zone
someone out of existence you cant make sure that they close and you cant prevent them from
their natural growth.
Amortization clause.
Too much power to give the government.
1 exception if the govt can prove that the business was a nuisance they can pursue a
nuisance claim instead of a zoning issue. The govt can get rid of it that way. Everyone still is
subject to a nuisance law zoning didnt replace this.
Doesnt help the owner if he changes his type of business (adult books changed to
childrens book) because any business there is out of compliance
SCOTUS says you can zone but it has to be prospectively
Does this distinction of past and future use really matter?
HYPO: landowner buys land, hasnt build dirty book business yet, city finds out and petitions
to change zone before building is built and thats ok? Should it be? Be able to argue both sides.
PA Northwestern Distributors, Inc. v. Zoning Hearing Board
Brief Fact Summary. The Appellant, PA Northwestern Distributors (Appellant), opened an adult
bookstore. Twenty four days later, the Township adopted an Ordinance that imposed restrictions
on the location and operation of adult commercial enterprises. The ordinance contained a
provision requiring pre-exiting business to come into compliance within a 90 day grace period.
Synopsis of Rule of Law. An ordinance requiring termination of lawful pre-existing uses was
confiscatory per se and unconstitutional as the loss of use of property without just compensation.
Issue. Does a pre-existing use constitute a vested property interest that cannot be taken away
without just compensation?
Held. Requirement that pre-existing use cease within a specified period of time was per se an
unconstitutional taking of a vested property interest without just compensation.
Concurrence. Chief Justice Nix (J. Nix) did not think that any provision for amortization of
nonconforming use was per se confiscatory and unconstitutional. J. Nix would review
consideration of a more reasonable amortization (more adequate time to conform), but thought
the ordinance here at issue was not reasonable and therefore was confiscatory and
unconstitutional.

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Discussion. There is a slippery slope if any use declared to be nonconforming could be amortized
out of existence without just compensation. The Court points out that any property owner could
lose the use of his property, a vested property right, without just compensation.

* The lower Court based its dismissal on the opinion in Sullivan v. Zoning Board of
Adjustment, which is not a correct statement of the law in this Commonwealth.
Sullivan presents a standard whereby the property interests of an individual are
balanced with the health, safety, morals or general welfare of the community at
large.
* Zoning involves governmental restrictions upon a property owners
constitutionally guaranteed right to use her property, unfettered by government
restrictions, except where the use violates any law, creates a nuisance, or the owner
violates any covenant, restriction, or easement.
* A lawful nonconforming use establishes in the property owner a vested property
right that cannot be abrogated or destroyed, unless it is a nuisance, it is abandoned,
or it is extinguished by eminent domain.
* If the effect of a zoning law or regulation is to deprive a property owner of the
lawful use of her property, it amounts to a taking for which she must be justly
compensated.
Concurrence: A blanket rule against all amortization provisions should be rejected.
The instant provision is confiscatory but the Sullivan standard should be upheld.
d. Variances. Zoning by its nature is general; it does not take into account the
particularities of every lot in the zone. For that reason, boards of zoning
adjustments have been established locally. They are empowered to grant variances
for conditions that are unique to a particular lot or two. If the condition is not
unique, a change in zoning should be sought. Suppose, for example, that when a
tract of land was changed from a commercial zone to a residential zone, a 20-foot
side yard requirement was imposed. If there were a few lots that, due to their
shape, could not be used for housing if the 20-foot side yards were required, the
zoning adjustment board could grant a variance.

A Variance is a permission not to comply with an otherwise valid zoning regulation. For
some reason, you dont comply and you seek permission from the govt to obtain a variance. The
burden to show that the variance is warranted is on the petitioner.
What must you show? 1) complying with the zoning plan will cause undue hardship not
just difficult or expensive must be undue hardship. In order to do this you must show that you
have attempted to come into compliance with the zoning plan (like buying needed land from a
neighbor before going to the zoning board); 2) you must show that the hardship that you speak of
is not self-inflicted. (like getting rid of several plots, leaving you with one too small to meet
zoning regulations your actions/choices did this not the govt.); and 3) the variance that you
seek will not impinge upon the public good and the intent and purpose of the zoning plan. If your
variance would destroy the entire reason for the plan then it wouldnt work.
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Area Variance zoning plan where every house has to meet certain requirements
Use Variance all properties in this area must be commercial or residential, etc.
You can seek variance for either but generally speaking the burden of proof is higher
for those seeking use variance than those seeking area variance why? Remember, we must
show undue burden/undue hardship. ITs probably hard to show this if you cannot do THIS
action in THIS place. If you cant build a house but you could build a gas station its another
use so its not an undue burden it would be hard to prove an undue hardship based on the
fact that you cant do a certain action but you could do an alternative action instead
Variances must run with the land they are not personal to the individuals seeking them.
If Weingarten gets his variance and then sells the house it would be unusual for the new owner
to have to go through the whole damn thing again! Thus, the variance runs with the entire plot.
1) Special Exceptions. A special exception is not the same thing as a variance.
Where a particular use is compatible in theory with the surrounding zoning if certain
conditions are met, a special exception can be issued to the landowner. Criteria
must be established for granting special exceptions.

Exceptions: These arent really exceptions. Exception is using the land in a way that the
land permits but because of the type of use you want to do the city wants to be more hands
on. Commercial zoning and you want to open a junkyard. Since this type of business may be
dangerous the city may want to keep more of an eye on you so the govt is seeking an
exception to the rule for itself its like a special process for more dangerous/unique uses of
land. The govt wants to take a closer look at the situation
a) Example. A gas station may be compatible with a residential neighborhood if the
gasoline storage tanks are placed underground. The ordinance regarding special
exceptions would have to set forth the requirements for permitting a gas station in a
residential neighborhood.

City of Edmonds v. Oxford House, Inc.

Not in my own backyard syndrome
Remember, when it comes to zoning, the Courts will not second-guess what the legislature
decides. They trust their judgment.
City tries to argue that it is permitted to limit the family unit under the zoning regulation. They
are just controlling numbers.
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SCOTUS 6 to 3 decision. Families can be of any size some can be 2 or 10. Simply saying only
5 unrelated but any number of related people can live there shows you are not doing this based
on size but rather on other characteristics.
Zoning can often be a cover for these exclusionary policies. For awhile, we had a very sordid
history of outright exclusionary like race or other characteristics. Luckily we dont have that
anymore.
Often, you can have the same result by excluding people you just dont like alcoholics or
people with low income through zoning. You can control how big the houses must be and limit
the low and middle class people from living within that zone.
Zoning for single-family used household allows you to exclude group homes, etc.
Facts of the Case: In Washington State, the City of Edmonds' zoning code provides that the
occupants of single-family dwelling units must compose a family, defined as "persons related by
genetics, adoption, or marriage, or a group of five or fewer [unrelated] persons." Under the code,
Oxford House, which operates a group home for 10-12 adults recovering from alcoholism and
drug addiction in a neighborhood zoned for single-family residences, was issued a citation.
Oxford House asserted that under the Fair Housing Act (FHA), which prohibits discrimination in
housing against persons with handicaps, the city had failed to make reasonable accommodations
permitting the maintenance of the group home in a single-family zone. Edmonds sought a
declaration that the FHA did not apply to the city's zoning code. The District Court held that the
city's zoning code rule defining family was exempt from the FHA under as a reasonable
restriction regarding the maximum number of occupants permitted to occupy a dwelling. The
Court of Appeals reversed.
Question: Does the City of Edmonds' zoning code provision covering areas zoned for singlefamily dwelling units -- which defines family as persons related by genetics, adoption, or
marriage, or a group of five or fewer unrelated persons -- qualify for exemption from the Fair
Housing Act?
Conclusion: No. In a 6-3 opinion delivered by Justice Ruth Bader Ginsburg, the Court held that
Edmonds' zoning code definition of the term "family" is not a maximum occupancy restriction
exempt from the FHA. Noting that it was designed to foster the family character of a
neighborhood, Justice Ginsburg reasoned that the provision was a family composition rule and
was not a maximum occupancy restriction exempt from FHA scrutiny because, while it capped
the number of unrelated persons allowed to occupy a single-family dwelling at five, it did not
cap the total number of people permitted to live in such a dwelling. Justice Clarence Thomas
wrote a dissenting opinion, which was joined by Justices Antonin Scalia and Anthony M.
Kennedy.

Southern Burlington County NAACP v. Township of Mount Laurel Case

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Courts have ordered the States to do more in New Jersey.

Another review of Exclusionary Zoning issues.
Court sided with the plaintiff. All zoning regulation may be adopted for the general welfare not
just for an individual. Zoning power is the police power of the state a general state power. State
delegates this power to towns/villages/municipalities. Its within the state as a whole.
Since municipalities have derived power from the state- they must consider all of the citizens of
their state
Relief provided in the case was each developing community must take affirmative steps to
zone some areas in such a way as to provide low income housing. Radical shift! They must zone
part of each community to allow for low-income housing no matter the cost of the land. These
obligations are presumptive so the burden to explain why they are not doing this is up to the
local community.
Ecological concerns can be dealt with mitigation efforts.
Each municipality must take their fair share of low income housing and they cannot ignore the
needs of out of state commuters.
This is the apex of zoning in this way very much an outlier.
So what should happen once it is shown that a township, a city, a village, zoned in such a way, as
to have the effect, whether intended or not, to exclude low income people should they be
forced to basically admit low income people? Should there be no divider between high income,
middle income and low income residents?
Are these policies good? Positive/Negative?
Brief Fact Summary. Plaintiffs-Respondents, the Southern Burlington County NAACP among
others (Plaintiffs), were composed of poor, minority citizens who sought decent, low to moderate
income housing and either lived in substandard housing or were forced to move elsewhere due to
the absence of suitable housing. The Plaintiffs have argued that the Defendant-Appellant, the
Township of Mount Laurel (Defendant), has effectively excluded them from the municipality
through its land use regulations.
Synopsis of Rule of Law. Zoning as an action under the police power must promote the general
welfare and cannot be motivated by other considerations such as minimizing the local property
tax rate.
Issue. Whether a municipality may validly by land use regulation make it physically and
economically impossible to provide low and moderate-income housing and thereby exclude
people of limited income and resources?

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Held. A municipality must by its land use regulation create an appropriate variety and choice of
housing. Actions under the police power are affirmatively required to promote general welfare.
Conversely, the zoning enactment is contrary to the general welfare and is invalid. A
municipality must zone for the welfare of the people and not for the benefit of the local tax
rate.
Discussion. There exists an affirmative duty not to foreclose classes of people seeking low to
moderate-income housing. The court found that the reason for the Defendants policy of land use
regulation was to keep down local taxes on property without regard for considerations related to
people, since New Jerseys tax structure imposes educational costs on local real estate. The court
felt that the regulations were designed to limit the number of school children and thus lower the
tax rate.
Remedy was in the hands of the municipality who should have the first full opportunity to
perform the function of enacting appropriate land use regulation that would provide for low and
moderate income housing of without judicial supervision. Further action could be taken if the
municipality failed to meet its affirmative duties.

Law of Nuisance
How is this different from zoning? One difference is that under nuisance, you can still operate a
business later, if you come into compliance maybe, whereas with zoning, if you arent in
compliance and/or cant be in compliance, you are out of luck.
Law of nuisance is the background law of property and part of the common law its always
been zoning came after we had built a bunch of stuff and is not a part of common law of
property.
You cant damage the property of your neighbors just because you want to dig a hole in your
property if you do a lawful thing in an improper place you can never use your property in
such a way as to damage others.
Its possible that something that was lawful 10 years ago is considered a nuisance now.
Zoning does not displace Nuisance remember this.
Libertarian Argument if the government wants to develop land differently, then they should
compensate these landowners properly.

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Eminent Domain
We give the govt this power because of people holding out for better deals/screwing up projects
need bridges/roads and the project needs to be complete for this to work. Private land uses are
different they can build around these hold out parcels but public land uses need to complete
the project.
Govt will only pay you market rate compensation which may be less than what you think the
market is worth. Your family home would be worth more to you than to the market, for example,
due to the value of the memories.

EMINENT DOMAIN & REGULATORY TAKINGS

Nor shall private property be taken without just compensation. This means there are
two important restrictions: the use for which the property is taken MUST be public
and the owner MUST be compensated. This restricts States and the Federal Govt.
The government is the king basically. They can come and take your property. They
always can and always will. If our government comes and takes our property, they
have to give us just compensation.
o Eminent Domain: Authority of govt to take private property for public use, in
exchange for just compensation
3 Elements:
(1) Government can take private property (any kind of
property: personal or real)
(2) For public use

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o Public use means public purpose (roads/etc); economic

development plans are public purposes (public purpose is
not constitutionally defined!
Kelo (D city wanted to condemn private property to
build shopping ctr to economically revitalize the
city; court held the plan qualified as a public use
under 5th Am)
Whether the citys decision satisfies the requirement
under the 5th Amendment.
SCOTUS: Because the plan unquestionably serves
a public purpose, the takings challenged here
satisfy the public use requirement of the 5th
Amendment Page 620
Dissent: As for the victims, the government now has
license to transfer property from those with fewer
resources to those with more. Public sides with the
dissent really.
Brief Fact Summary. In 2000, the city of New
London approved a development plan that, in the
words of the Supreme Court of Connecticut, was
projected to create in excess of 1,000 jobs, to
increase tax and other revenues, and to revitalize
an economically distressed city, including its
downtown and waterfront areas. The city
purchased property and seeks to enforce eminent
domain to acquire the remaining parcels from
unwilling owners.
Synopsis of Rule of Law. The court had previously
held in the Midkiff case that such economic
development qualified as a valid public use under
both the Federal and State Constitutions. The court
has to meet two burdens for eminent domain- (1)
that the takings of the particular properties at issue
were reasonably necessary to achieve the Citys
intended public use and (2) that the takings were
for reasonably foreseeable needs.
Issue. Whether the citys proposed disposition of
this property qualifies as a public use within the
meaning of the Takings Clause of the Fifth
Amendment.
Held. The citys proposed disposition of petitioners
property qualifies as a public use within the
meaning of the Takings Clause. Public use in this
case was broadly interpreted to mean public
purpose.

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Discussion. This jurisprudence has long recognized

the needs of society vary greatly between different
parts of the Nation. Earlier cases embodied a
strong theme of federalism, emphasizing the great
respect owed to state legislatures and state courts
in discerning local public needs. Public needs used
to be according to rigid formulas and intrusive
scrutiny in favor of affording legislatures broad
latitude in determining what public needs justified
the use of the takings power. The court must look to
the entire Plans importance and the Citys overall
interest in the economic benefits derived from the
development.
What do we think about either side?
Court held eminent domain should only
occur when it is clear public benefit will
occur
o Justifications
Precedent: Courts have interpreted public use as
public purpose for 100 yrs
Federalism: FG should leave states alone unless
strong basis for stepping in
Separation of Powers: 3 separate govt branches
Judiciary implements policy, doesnt make public
policy b/c no elected officials
Pragmatic Purpose: Court didnt want fed courts
flooded w/ cases by redefining public use every
time public use case came up deference to govt
better
(3) In exchange for just compensation
o 5th Am + most state constitutions: Private property cant be
taken for public use w/o just compensation
o Measure of just compensation is FMV, comparable for
willing seller/willing buyer
o Just Compensation doesnt necessary mean full
compensation but rather means market compensation
or fair market value compensation - Reason per
SCOTUS: Because of serious practical difficulties in
assessing the worth an individual places on particular
property at a given time, we have recognized the need for a
relatively objective working rule
o Courts use various techniques to value real estate for
market value: 1) look at recent sale prices; 2) look at recent
sale prices of comparable properties; 3) use the capital
value of the actual or potential rental value of the property

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in question and 4) use the rebuilding cost of the building in

question discounted on basis of age and wear/tear
o Fair market value is the amount a buyer and seller would
agree upon in the absence of duress or necessity. The price
must reflect the most profitable possible use of the land (as
zoned) regardless of the use intended for it

Rationales:
Early civil scholars said sovereign states had original/absolute
ownership of property, prior to possession by citizens individual
ownership derived from state grants, subject to implied reservation
that state can resume ownership
Feudalism taking power is a remnant of feudal tenure
Natural law theorists said eminent domain is an inherent attribute
of sovereignty, necessary to govts existence (most common
rationale today)

What factors will a court look to when determining whether govt action is a taking, requiring just
compensation, as opposed to a mere regulation?
For a land use regulation to avoid being a taking, it must: (1) substantially advance legit state
interests and (2) not deny an owner economically viable use of his land. Here are some
specific factors courts look to in applying this general test:
1) Whether the government makes (or authorizes someone else to make) a permanent physical
occupation of the property. If so, this will automatically constitute a taking (regardless of how
little the burden on the owner or how large societys interest in having the occupation occur.
2) How great the reduction in value of the owners property. The greater the reduction, of course,
the more likely it is to be found to be a taking. But this is just one factor, and fairly large valuereductions have been held not to be takings.
3) Whether the owner has been denied all economically viable use of his land. If so, its
automatically a taking. Thus, a total ban on the building of structures on the land will certainly be
ta taking.
4) Whether the use prevented is harmful or noxious to others nearby (e.g. a steel mill in a
residential neighborhood). If so, a regulation, not a taking, is likely to be found.
5) Whether the statute can be fairly described as zoning. If so, its likely to be found to be a
regulation, not a taking. The same is true of landmark preservation statutes.
HYPO: Abe Lincoln owns a large apartment building. Old Abe has pretty firm ideas about what
ails society. One of his biggest peeves is television. He is therefore furious when the state enacts
a statute compelling owners of apartment buildings to allow cable television companies to install
cables in the apartments. Abe contends that he is entitled to compensation due to a government
taking is he correct?
Answer: Yes. The presence of the cables constitutes physical occupation and the government
doesnt have Abes consent to install the cables. Thus, hes entitled to compensation (Loretto
Case).
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HYPO: Johnny Appleseed has fruit trees in his yard that become infected with deadly Bungi
Branch Rot. The disease threatens to spread the commercial orchards nearby. If the State
demands that Appleseed destroy his trees, must it pay him just compensation for the value of the
lost trees?
Answer: No. The two main factors determining whether the govt action is a taking as opposed
to a regulation are (1) whether the action is an appropriate or permanent invasion; and (2)
whether it has a severe economic impact. Weighing heavily in this calculation is the degree to
which society benefits from the action. Here, the existence of a disease threatening an important
crop weighs strongly against considering the government action is a taking. Instead, the state
action is taken under the police power to protect industry, and as such, it will be considered a
regulation.
HYPO: Ty Koone owns Lighning Acres, which was at one time Ben Franklins Summer Home.
He operates the property as a profitable resort. He plans to tear down the original building and
put up a high-rise building in its place; however, the state steps in and designates the property as
a historic landmark, putting the kibosh on Tys plans. Will Ty be entitled to compensation due to
a government taking?
Answer: No. Designation as a landmark is considered regulation as long as the property owner
can still get a reasonable return on his investment (Penn Central). Here, Ty can get a return on
his investment and in the face of public policy of preserving landmarks, the court will deny Ty
any compensation.

The Takings Tests

Factors in Ad Hoc Review:

1. The economic impact of the regulation on the claimant;

2. The extent to which the regulation interferes with the owners distinct
investment-backed expectations
3. The character of the government action

Takings Analysis:
1. Has your land been taken from you? Either by physical occupation or by regulation.
2. To the extent that your land was under a taking was it for public or private use? If public use
what is the public purpose? Private uses can also be for the common good/carriers (railroad)
3. Once the petitioner has satisfied showing theres a taking and the govt has satisfied that its for
public use then the question of just compensation comes up.
Takings Clause Analysis:
1. Is there a taking?
2. is the Taking for public use?
3. Was there just compensation paid?

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Government will sometimes say you can keep your land but you just cant do A, B or C on it. Or,
you can keep your land but we need to also do something on your land. This can diminish the
value of your property. So when does the actual taking occur which triggers the just
compensation requirement?
Two types of takings separated in two types (both very different): 1) physical taking
government comes in and says we are going to take your property/physical come into your
land/occupy by force you must surrender part of your land physically to the government; and
2) regulatory taking. This is when the govt promulgates regulations (protect the environment,
etc.) that diminishes the value of your land. No govt agent comes onto your land physically but
they tell you what to do (cant do or must do).
Physical takings are subject to a simply categorical rule: If the govt physically takes your land;
its a compensable taking. Once the govt does this, they owe the owner just compensation.
Sometimes there is a debate as to what it means to physically take the land.
Landowners = they want it to be a physical taking because then the govt needs to give them
just compensation or they have to stop if not for public use.
Govt = they want it to be a regulatory taking, since they usually win here.

Takings Tests (Ps want to fit all 3 tests b/c want 3 bites at the apple to prove a taking)
USSC recognizes all 3 takings tests b/c they aim to identify regulatory actions which are
functionally equivalent to eminent domain (Lingel)
o (1) Default Ad Hoc Balancing Test 3-part balancing test
Considers effects on present + future economic value caused by reg; no
instruction to courts re how to do balancing ad hoc means courts use
the test when/how they want
(i) Economic interference with existing use of the property
(present value)
o Does it impair owners current use of the property?
(ii) Reasonable investment-backed expectations (RIBE) hurt
(future value of property)
o RIBE: USSC-created phrase + undefined either side +
court can interpret differently
o Courts interpret RIBE effect differently:
Some say reg must destroy all economically-viable
use of land
Some say regs must interfere w/ already-made
investments

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Some say RIBE helped by Transferrable

Development Rights (TDRs) (TDR to build 10
stories allows owner to build 10 stories higher than
zone otherwise allows)
Penn Central (TDRs help RIBEs + give just
compensation for taking)
(iii) Character of the governmental action (Regulatory Taking)
o Penn Central (NY Terminal designated a Landmark
restricting owners ability to build 55-story tower on it;
Court holds no taking b/c doesnt hurt present value,
TDRs allowed, type of govt axn is general health/welfare of
society)
o The opposite of a bright-line rule is a Regulatory Taking
which is the type of taking that typically the government
wins when it is challenged.
o Remember property rights go right from heaven and hell
ground and air rights
o City said they could use the property just not in the way
they wanted to. SCOTUS agrees with the City in a
regulatory frame the govt doesnt physically occupy but
exerts a regulatory regime.
o Under a regulatory regime, in order to determine a taking,
you go through an ad hoc review (basically they make it up
as they go along):
o Factors to consider:
1) Economic impact on the property owner;
2) Character of the governmental action;
3) The extent to which the regulation interferes with
the owners distinct investment-backed
expectations.
o Court has to consider whether the interference of the
property is for such magnitude that the govt invokes
eminent domain (which would be a taking). This is a
judgment call. How much is too much? This is why its a
balancing act.
o Not clear that there was a complete taking of air rights
either City only said they couldnt build the two proposed
models Penn couldve submitted additional models for
building for approval
o So plaintiff and the public got a reciprocal benefit both
sides are gaining something this matters when we
consider the magnitude of the interference
o Dissent: This is not a mere adjustment of benefits; this law
singles out buildings that the govt of new York considers
important and burdens these buildings in a different way

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o
o
o

than other buildings in new York. This is different from a

zoning plan where you treat everyone equally. When you
pick out certain buildings and impose burdens on them that
you dont impose on others, those owners deserve just
compensation.
Brief Fact Summary. Penn Central (Appellant) owned the
Grand Central Terminal, which was designated by
application of New Yorks Landmarks Preservation Law to
be a landmark. Thereafter, the Appellant entered into a
renewable 50-year lease with UGP Properties, Ltd., a
United Kingdom company, under which the UGP agreed to
construct a multistory office building on top of the
terminal. The plans for the new office building were
submitted to the Commission for approval, which was
denied.
Synopsis of Rule of Law. In deciding whether a particular
government action has effected a taking, this Court focuses
both on the character of the action and the nature and
extent of the interference with rights in the parcel as a
whole.
Issue. Has a taking occurred?
Held. No. Affirmed.
Several factors must be weighed to determine whether a
taking occurred: (1) the economic impact of the regulation
on the claimant and the extent to which the regulation has
interfered with distinct investment backed expectations,
and (2) the character of the government action, a taking is
more readily found when the government has physically
invaded the property than when interference arises from
some public program adjusting the benefits and burdens of
economic life to promote the common good. In deciding
whether a particular government action has effected a
taking, this Court focuses both on the character of the
action and the nature and extent of the interference with
rights in the parcel as a whole- here, the city tax block
designated as the landmark site. The Appellants
contended that a taking had resulted by the diminished
value of the terminal as the result of the Landmarks Law.
The Court pointed out that other precedent cases held that
diminished value as the result of rezoning did not amount
to a taking.
The Court concluded that the interference with Appellants
property was not such that the interference amounted to a
taking requiring just compensation. The Court also held
that the impact of the regulation on Appellants parcel was

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insufficient to require the government to institute eminent

domain proceedings.
o Dissent. The dissent would not equate the Landmarks Law
with a zoning regulation. The dissent points out that the
effect of the Landmarks Law is to place an affirmative duty
on the owner of a designated property to maintain the
property as a landmark at his own expense.
o Discussion. This case should be read closely as it contains
an excellent discussion of the permissible scope of zoning
regulations and the requirements for finding that a taking
has occurred. The Court did stretch a bit to uphold the
Landmarks Law based on its analogy to zoning
o Per Se Rules in Regulatory Takings
IF you take all economic value out = taking
Line of taking too much vs. taking enough
balancing test ad hoc determination
We are trying to figure out 1) what were the
amounts of minutiae (amount of interference of
property rights) (property interests) and 2) since we
care about was there physical invasion whether
something that was taken from you looking at the
benefit to see if they were reciprocal benefits on
both parties.what were the expectations did you
get anything back?
In order to figure out the imposition on the
individual, need to look at both sides are you
gaining something from this regulation?
o (2) Permanent Physical Occupation (PPO) Test PPO is always a taking
(Per se Rule)
Permanent: Means permanent until property use changes
Still considered permanent even tho zoning & legislation could
change the PPO
Physical: Means being on the property
Occupation: Distinction between permanent PO (PPO Test) & temporary
PO (Balancing test)
Loretto (NY law said landlord must permit cable TV co to install
cable facilities on its property; Court held PPO requiring just
compensation under 5th + 14th Ams)
NY govt required each landlord to give permanent permission for
the installation of the CDTV antennas and any interference with
maintaining said cables.

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Loretto sues for trespassing govt has permanently invaded my

land occupation was the physical cable box and cables, etc
and the govt hasnt give Loretto just compensation.
SCOTUS this is a taking.
Regulations will be upheld if not unreasonable and focused on the
public good
Physical intrusion is just more serious when it comes to a taking.
There is also a difference between a permanent or a temporary
occupation. There is something special and distinct about physical
occupations that are permanent. A Per Se Rule = a taking will
always be found when there is a permanent physical occupation.
Once you completely lose your property just a part of it it falls
under the Per Se Rule.
However, when there is a temporary occupation (come onto land
to place a hook then remove the hook) is subject to a balancing
test.
The Right to Exclude perhaps the most important property right.
With the cable company asserting control over the cable box,
Loretto has lost the Right to Exclude the cable company/govt from
using his property that was now occupied.
How much space is actually occupied by the taking is not
important when trying to analyze if a taking has occurred.
Dissent: This isnt permanent invasion; the landlord can convert
the house to a single family house instead of an apartment (is this
really true tho?)
This was a minimal intrusion and shouldnt fall under the Per Se
Rule.
Since Loretto any permanent physical occupation triggers a
compensation requirement.
Loretto is compensated $1 like nominal damages?
HYPO: People distributing literature at mall; mall owner says you
cant do it; govt statute says they can; mall owner wants
compensation; Court found that this was a temporary occupation
and upheld the statute.

Per se:
Govt intent + how much space PPO occupies irrelevant
No balancing of govt interests or economic impact created by the
regulation
A permanent physical occupation authorized by the government is
a taking, period.
Problems with a per se rule: (Loretto dissent)
o Excludes consideration of other circumstances which may
justify PPO

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o Possibility of manipulation by parties who unfairly act up

to the line w/o crossing it
o (3) Total Takings Test Deprives owner of all reasonable economic
use/benefit always a taking (Per se Rule) (Consider Whole Parcel Rule
or Conceptual Severance to manipulate outcome)
Per se: Govt intent/purpose + actual value of the property irrelevant
Lucas (SC law prohibited building certain distance from erosion
line to prevent beach erosion prevented P from building on his
lots b/c not enough usable land left for a house yes taking)
When we talk about takings and the property owner wins against
the govt it means that the govt must pay you just
compensation.
If the taking is found to be For Public Good no compensation is
needed because everyone benefits all of the citizens and society
in general.
SCOTUS says that this is a taking 5 to 4 decision. Permanent
physical invasions are per se takings. A law or decree that
prohibits all of the value of the land is a taking.
if it denies an owner economically viable use of his land
SCOTUS rejects the state argument that you can circumvent their
second principle because developing these beach front properties
would be a noxious use. The state didnt carry their burden to
show that the nuisance was there the basically just said it was
true
You shouldnt put the cost of benefiting the public onto one
individual landowner
Its hard to say the Lucas property has no actual value he has
some options it doesnt have the value he intended for the
property
Lucas he gave up a lot and gained nothing really so the
balance weighs heavily in favor for a taking.
Actual outcome of the case kinda shows that all of South
Carolinas arguments had no real basis instead they wanted to
accomplish a goal for no cost but to Lucas detriment
The outcome of the case was criticized by environmentalists...
Ultimately, its a balancing test society vs. individual ?
Brief Fact Summary. Lucas (Petitioner) bought two residential lots
on the Isle of Palms in Charleston County, South Carolina, upon
which he intended to build single-family homes. In 1988, the South
Carolina Legislature enacted the Beachfront Management Act
(Act), barred Petitioner from erecting any permanent structures on
the two lots.

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Synopsis of Rule of Law. When the state seeks to sustain regulation

that deprives a landowner from all economic use, the state may
resist compensation only if the logically antecedent inquiry into
the nature of the owners estate shows that the proscribed use
interests were not part of his title to begin with.
Issue. Has Petitioners property been taken in a way that
requires just compensation?
Held. Yes. Judgment reversed.
There are two categories of regulatory action as compensable
without case-specific inquiry into the public interest advanced in
support of the restraint: (1) when the property owner has suffered
a physical invasion of his property; and (2) when the regulation
denies all economically beneficial or productive use of land. The
Court finds that there are good reasons for the belief that when the
owner of real property has been called upon to sacrifice all
economically beneficial uses in the name of the common good, that
is, to leave his property economically idle, he has suffered a
taking. The Supreme Court of South Carolina based its opinion on
the fact that there was a line of cases, which state that the
government can proscribe harmful or noxious uses without
paying compensation. The Court here states that the more
contemporary standard is that land use regulation does not
constitute taking if it substantially advances legitimate state
interests. However, when the state seeks to sustain regulation that
deprives a landowner from all economic use, the state may resist
compensation only if the logically antecedent inquiry into the
nature of the owners estate shows that the proscribed use interests
were not part of his title to begin with. Thus, the burden is on
South Carolina to identify background principles of nuisance and
property law, that prohibit the uses intended by Petitioner in the
circumstances the property is now found.
Dissents: The first dissent does not like the threshold question of
has the property lost all its economic value, and states that the
trial courts finding of total economic loss was erroneous. The
second dissent does not like the new test either, because the whole
takings jurisprudence has been based on an ad hoc factual inquiry.
Concurrence. The concurrence felt that the Supreme Court of
South Carolina erred by simply reciting the intent of the legislature
in adopting the Act, and that the court should have gone further in
describing the need for the regulation.
Discussion. This case describes the two categories of regulatory
taking: (1) when the property owner has suffered a physical
invasion of his property; and (2) when the regulation denies all
economically beneficial or productive use of land.
o Dissents concerns

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If govt takes only 95% of propertys economic

value still not a taking
Unclear what reasonable economic use is

2 Exceptions
Common Law Nuisance: If use owner proposes is common law
nuisance no taking
Preexisting Limitation on Property Rights: If use property
owner proposes is something they didnt have the right to do
before the reg no taking
o Examples:
Infringe on a recognized easement
Trust doctrine some states: public rights to use
beach mean beachfront property owners cant
exclude public

(4) Judicial Takings

What happens when your property rights are adjusted by judicial decree?

Stop the Beach Renourishment Case

Under traditional common law in FL you own it up to a certain point up
to the beach/mean tide mark beyond that its owned by the State. Beach
is also pretty unstable.
Beachfront property literal right of access to your own property.
State govt would have the authority to re-nourish their beaches
according to this new law
As a result, certain rights of the people owning breachfront property would
be extinguished.
The right to accretions is the contingent interest. Its not a vested property
right because things might accrete and might not accrete. So you didnt
have the vested right in the water so its okay to take it from you.
When the Constitution talks about takings they talk about the state. They
dont talk about judges.
The Takings Clause bars the State from taking private property without
paying for it, no matter which branch is the instrument of the taking.
Remember, property is about relationship with people and things and
people and people not about things in general.
Petitioners failed to carry their burden.
Property may be taken irrespective of which branch of govt takes it but the
burden is on the petition (property owner) that he claims it was taken from
him that that property right existed and that the nature of the property
right has been changed (i.e., taken). Basically, the person has to show that
they have the property right FIRST. They carry the burden of proof, not
the state.
Facts of the Case: In 1961, Florida enacted the Beach and Shore
Preservation Act ("BSPA") to restore and maintain critically eroded

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beaches within the state. In 2003, under the BSPA, the Florida Department
of Environmental Protection filed for an Application for a Joint Coastal
Permit and Authorization to Use Sovereign Submerged Lands in order to
dredge sand from a shoal to rebuild a beach. Stop the Beach
Renourishment Inc. ("SBR"), an association of homeowners, subsequently
challenged the issuance of the permit and the constitutionality of the
BSPA. The Florida court of appeals rescinded the permit, holding that
issuance would have resulted in an unconstitutional taking.
On appeal, the Supreme Court of Florida first rephrased the certified
question to determine whether the BSPA was "on its face" constitutional.
Then, the court held that the BSPA was not unconstitutional, reasoning
that it did not deprive land owners of littoral rights without just
compensation.
Question: By reversing longstanding holdings that littoral (i.e., on or near
the shore) rights are constitutionally protected, did the Florida Supreme
Court cause a "judicial taking" proscribed by the Fifth and Fourteenth
Amendments?
Conclusion: No. The Supreme Court held 8-0 that the Florida Supreme
Court did not take property without just compensation in violation of the
Fifth and Fourteenth Amendments. Justice Antonin Scalia announced the
judgment of the Court, and authored an opinion in which he maintained
that there could be no taking unless property owners could show that they
had rights to future exposed land and to contact with the water superior to
Florida's right to fill in its submerged land. Here, there could be no
showing. Scalia drew from Florida-law principles that (1) the state, as
owner of submerged land adjacent to beachfront property, has the right to
fill that land and (2) the exposure of land previously submerged belongs to
the state even if it interrupts the beachfront property owners' contact with
the water. Justice Scalia, with a plurality of the Court including Chief
Justice John G. Roberts and Justices Clarence Thomas and Samuel A.
Alito, also noted in Parts II and III of the decision that if a court declares
that what was once an established right of private property no longer
exists, it has taken that property in violation of the Takings Clause.
Justice Anthony M. Kennedy, joined by Justice Sonia Sotomayor,
concurred in part and concurred in the judgment. He agreed with the
Court's holding, but disagreed that a plurality should reach the issue of
whether or when a judicial decision determining property owners' rights
can violate the Takings Clause. Justice Stephen G. Breyer, joined by
Justice Ruth Bader Ginsburg, also concurred in part and concurred in the
judgment. He agreed with the Court's holding, but, like Justice Kennedy,
counseled that the Court should only address the issues before it.

HYPO: Must the govt avoid taking your property to avoid a taking? NO courts allow the govt
vast control over this and trust their judgment. So because the govt could build a bridge next to
your land for more money rather than taking your land to build the bridge the govt is not
required to seek alternative ways not like strict scrutiny..

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