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Property Vocab:

Privity: a relationship between two party by law, lease, service, or blood


An action to quiet title is a lawsuit brought in a court having jurisdiction over property
disputes, in order to establish a party's title to real property, or personal property having a title,
of against anyone and everyone, and thus "quiet" any challenges or claims to the title.
Perpetual: NEVER ENDING!
Divestment: depravation of title, authority, especially to land

Part I: Introductory

A. What is Property? What is Law?


Law and Property

State v. Mann (TWEN)


pp. 103-104, 248-249; xiii-lxii
Privilege & Responsibility (T)

Property and the State

Commonwealth v. Alger (T)


Police Power (T)
pp. 623-633

The Power to Exclude

pp. 3-20
Part II: Acquiring Property

A. Acquisition by the State


1. Conquest

pp. 83-100, 1168-

1175

2. Takings
a. Eminent Domain

Regulatory Takings

pp. 1141-1168

pp. 1175-76, 1179-1181,

1184-119

Acquisition by Individuals
Government Grant

pp. 100-101

Squatting
Squatters often claim rights over the spaces they have squatted by virtue of occupation, rather
than ownership; in this sense, squatting is similar to (and potentially a necessary condition of)
adverse possession, by which a possessor of real property without title may eventually gain legal
title to the real property.

Gift, Will
Gifts
Inter Vivos (during life) Gift - Usual type of gift made during the donors lifetime. An inter
vivos gift cannot be revoked. Essential elements:
Intent to transfer title - donor must intend to make an immediate transfer of property
Delivery - the property must be delivered to the donee, so that the donor parts with dominion
and control. 3 types of delivery:
Manual - occurs when the donor physically transfers possession of the item to the donee
Constructive - Requires that the donor physically transfer to the donee an object that provides
access to the gifted item. (handing a key that opens a safe)
Symbolic - donor physically transfers to the donee an object that represents or symbolizes the
gifted item. (note stating I give my 100 shares of apple to X)
in many jurisdictions, only allowed if manual delivery is impracticable or impossible.
Acceptance - the donee must accept the property, although acceptance of a valuable item is
usually presumed.
Case Example:
Gruen v. Gruen Father wanted son to have valuable painting for his birthday but wanted to
maintain possession until he died. Stepmother kept painting, arguing no gift was made. Son sued
and won. (Father retained life estate in painting, while son had remainder interest as a gift)
Albinger v. Harris - Albinger sued Harris for engagement ring, lost. Court ruled it is not a
conditional gift, but an inter vivos gift.
Testamentary Gift or Testament Transfer (WILL)
Effective only after the donor dies. Usually made by a will.
Valid only if it satisfies the Statute of Wills, which requires a writing signed by the donor and
witnessed by two or more people
Gifts Causa Mortis - gift of personal property made by a living person in contemplation of
death, but is revocable before the death of the donor or in most states, automatically if the donor
does not die. 4 elements:
Intent to transfer (Donative Intent)
Delivery
Acceptance
Donors anticipation of imminent death

Case Example:
Brind v. International Trust Co. - Brind gifted jewelry and valuables to Trust Co. in fear of
death resulting from surgery. She survived but died shortly after due to underlying illness. Trust
co. didn't return jewelry. Brinds reps sued and won for valuables, b/c she did not die from the
contemplated death for which gift was made.
Exception: In some jurisdictions, upheld if donor dies of a cause related to the contemplated
death rather than exactly the contemplated death.
Rest. 2nd of property 31: a failure to revoke within a reasonable time after the donor is no
longer in apprehension of imminent death eliminates the right of revocation.

First Possession
Protect First Possession - First come, first served. (First in time concept)
Case:
Pierson v. Post - Pierson shot and killed fox Post was chasing. Judgment for Pierson because
though Post was chasing the fox, he had not yet brought it under his control (immobilized) it by
wounding it and had not deprived it of its natural liberty. Ownership should be given to the
first person to physically possess it.
POPOV case. Power to exclude others.
Popov could not, but Hayashi did!
Has to demonstrate that PROPERTY IS YOURS.

Finders
Finders: must have intent to control and actual possession
Four Categories of Found Chattels:
Lost Property - Property is lost when the owner unintentionally and involuntarily parts with it.
TO (True Owner) holds superior title to finder.
Mislaid Property - Property is mislaid when the owner voluntarily and knowingly places it
somewhere, but then unintentionally forgets it. Owner of land has rights to mislaid property on
land.
TO (True Owner) holds superior title to finder.
Abandoned Property - When the owner knowingly relinquishes all right, title, and interest to it
Treasure Trove - When the owner concealed it in a hidden location long ago. Treasure trove is
usually limited to gold, silver, coins, or currency.
General Rule: a subsequent possessors full payment to the finder bars any later action by the
true owner against the possessor. However, the true owner can compel the successful finder to
transfer the payment to her.
Case Examples:

Armory v. Delamirie: Chimney Sweep found jewel, took it for appraisal, goldsmith kept jewel.
Boy sued and won.
Finder of property is entitled to keep it against all but the rightful owner, (and possibly previous
finders).
Hannah v. Peel: Peel bought house, never moved in. Requisitioned by army during WWII.
Soldier found brooch, gave it to police who gave it to Peel, who sold it. Hannah sued for value of
Brooch and won b/c court considered it lost.
Owner is not in possession of property unless he occupies it.
Finder of lost property is entitled to it against all except the real owner. The location, whether
private or open to public and public property make no legal difference when finding lost property.
Exception: trespassers dont get awarded (Bridges v. Hawkesworth)
A man possesses everything that is under or attached to his land. Though Sharman found it, he
obtained them for his employers and could claim no title for himself. (Staffordshire water co. v.
Sharman)
McAvoy v. Medina Customer left pocketbook in Medinas barbershop. McAvoy, another
customer, found it and gave it to Medina in attempt to find true owner. No true owner found,
McAvoy sued Medina, Medina won suit.
Owner of property has rights to mislaid items on it, b/c courts reason that owner of property has
best chance of returning the mislaid property to the original owner

Adverse Possession
To have acquired title by adverse possession must demonstrate that she maintained
actual possession of the land in question
for the duration of the statutory period of limitations on an action to recover
possession of land, and that throughout this period her possession was:
"open and notorious" (i.e., visible and not surreptitious)
"hostile " and "under claim of right" (i.e., without the true owner's permission)
"continuous" (i.e., without interruption), and
"exclusive" (i.e., in a manner that reflects the possessor's dominion and control over the land).
Adverse Possession and Color of Title
Under color of title:
Good faith is a necessary prerequisite for establishing adverse possession under color
of title.
Constructive Adverse Possession:
It is possible for someone to lose title to land by adverse possession, even where a portion of
that land was not physically occupied.
Under the circumstances, the Hatfields cannot reasonably expect to claim title by constructive
adverse possession to the 5-acre parcel. At all times, the McCoys (the true owners) have been in
open and exclusive possession of the 5-acre parcel. Despite holding a deed that appears to give

them title to this land, the Hatfields have not objected to or interfered with the McCoys'
possession of the land at any time.

Adverse possession seeks to encourage true owners of land to be vigilant to identify and resolve
potential possessory encroachments, and does so by punishing those owners who "sleep on their
rights" and fail to object to possessory encroachments in a timely manner. Here, the McCoys are
not "sleeping on their rights" -- to the McCoys, there is no appearance that the Hatfields are even
attempting to claim possession of the 5 acres in question.
Tacking adding of time of one AP to another AP.
Courts have traditionally permitted two or more successive periods of adverse possession to be
tacked together, as necessary to permit the current possessor to satisfy the requisite statutory
period, so long as the successors stood in the relationship of privity. Stella and Frank would
stand in a relationship of privity so long as (a) each exercised possession over the land in
question and (b) Frank (the current possessor) received the right to possession by virtue of a
legal transfer from Stella (the former possessor), either by deed, by devise, or by inheritance.
Privity of Estate vs Privity of Possession. 1st is in a deed, other transferred assuring it
is in the deed.

Contract/Sale
The Real Estate Transaction
Statute of Fraud: Elements Oral agreements for the sale or property is not enforceable
Essential Terms
Identity of Parties
Price
Property Description
Writing
Can be a formal contract or informal memorandum
Signature
Writing must be signed by the party against whom enforcement is sought
Exceptions:
Doctrine of Part Performance
An oral contract for sale of property may be enforced if buyer:
Takes possession
Pays at least part of the purchase price
Makes improvements to the property
Equitable Estoppel

An oral contract may be enforced if:


One party acts to his detriment in reasonable reliance on anothers oral promise
Serious injury would result if enforcement is refused
Failure to comply with SOF does not make the K void, but simply prevents it from being enforced

Case Example:
Hickey v. Green
Buyers give seller a check with a blank payee line and seller refused to sell and sold property to
another buyer. Buyers had partially performed by giving check and selling their own home. Court
ruled because plaintiffs relied on the K by agreeing to sell their home to another, injustice can be
avoided only by specific enforcement, despite the signature element of SOF not being met.
(Equitable Estoppel)

Misrepresentation, Fraud, and Remedies


Duty to Disclose
Most Jurisdictions
Seller of residential property is obligated to disclose defects he knows about that:
Materially affect the value of property and
Are not known to or readily discoverable by a buyer
In few Jurisdictions: Caveat Emptor applies
Seller of real property has no duty to disclose defects to the buyer.
Buyer has complete responsibility to assess condition of the premises.
Seller is liable only if he:
Affirmatively misrepresented the propertys condition
Actively concealed its defects
Owed a fiduciary duty to the buyer
(Applies more to commercial property)
Case Examples:
Johnson v. Davis
Davis agreed to buy Johnsons house after J assured that buckling around windows was from a
problem long fixed.
Rain went and into the house, breaking the roof.
Roofers for J can be fixed under 1000
Roofers for D cannot be permanently fixed roof is wholly bad

D sued to rescind the K and demanding deposit back


Court ruled in Davis favor.
J appealed.
Under duty to disclose known issues.
Court: Johnson knew of the problem.
Stambovsky v. Ackley
Although NY follows caveat emptor, buyer would not have been able to discover that the house
was haunted had he inspected it. Since seller knew about ghost but did not disclose it and buyer
had no other way to discover it, court ruled for P.
Teachers policy behind We want buyer to exercise due diligence, so buyer should at the very
least research the property. Not doing so is irresponsible, but the case was in 1991 where
internet hadnt really developed yet.

Remedies available to buyer:


Specific performance,
Damages,
Rescission,
Vendees lien (put lien on a property to return $$$ to buyer, or sell sellers property),
Remedies available to buyer:
Specific performance,
Damages,
Rescission,
Vendors lien (assume seller owns property, put lien, make buyer make a payment).

The Deed and Warranties of Title


Title Covenants
Grantor promises in the deed that he has good title to convey.
Buyers rights will depend on:
The type of deed received and
The scope of any promises that seller made in deed
3 Types of Deeds
General Warranty Deed grantor warrants title against all defects whether they arose before
or after he obtained title
Guarantees all six covenants
Regardless of whether grantor caused the breach

Special Warranty Deed grantor warrants title against all defects that arose after he obtained
title
Guarantees all six covenants only to the extent that the grantor breached them
Alternate view: SWDs only apply to present covenants
Quitclaim Deed grantor makes no warranties about title, so the grantee receives only what
the grantor has, if anything.
No guarantee of any kind
6 Standard Covenants 2 Types
Present Breached, if at all, at the moment deed is delivered. At that instant, the grantor either
has the estate he claims to convey or he does not
Covenant of Seisin promise that grantor owns the estate he purports to convey
Ex. Breached if grantor purports to convey a fee simple but only owns a life estate
Covenant of Right to Convey promise that the grantor has the right to convey title
Ex. Breached if grantor is a trustee who lacks authority to transfer title to the trust property
Covenant against Encumbrances promise that there are no encumbrances on the title,
other than those expressly listed in the deed.
Ex. Breached if there is a prior mortgage on property
Future Covenants breached, if at all, after the closing; most commonly when grantee is
actually or constructively evicted by a third party holding superior title
Covenant of Warranty promise that the grantor will defend grantee against any claim of
superior title
Ex. If a third party holds better title than the grantee, the grantor must defend the grantees title
Covenant of Quiet Enjoyment promise that the grantees possession of the property will not
be disturbed by anyone holding superior title.
Ex. Breached if grantee is evicted because of a defect in title
Covenant of Further Assurances promise that the grantor will take all future steps
reasonably necessary to cure title defects that existed at closing.

The Recording System


Recording System
Purpose
Records conveyances of real property
Anything related to land can be recorded
Creates public record of ownership transfers
Creates priority in case of conflicts

Recordation is not guarantee of validity, but provides resolution in the event of conflicting
transfers
Mechanics:
Documents
Mortgages, liens, easements, subdivisions
Index (See above)
Grantor-Grantee (Who?)
Tract (What?)
Technique
Search backward through grantees, then search forward through grantors
Do so only during respective period of ownership
Examine documents for validity
Recording Statutes (Differs b/w Jurisdictions)
First in Time First in Right
Race statute - First to record wins
Winner of the race must also be a purchaser for value to prevail. Gratuitous transfers (gifts) are
not considered purchases for value.
Notice statute Subsequent bonafide (good-faith) purchases for value always prevail (cant
know that its been sold to someone else)
Race-notice statutes must have good-faith and win race to courthouse
Shelter Rule:
Relationship a grantee has with an immediate grantor under a recording statute is transferred to
subsequent grantees with respect to grantor
Only later purchasers enjoy grantees bona fide purchaser status
Ex: O conveys to A, then to B. B takes as a BFP for value, and records. A records later. B later
tries to sell to C. A learns of the potential sale and tells C, Don't buy from B, Im the real owner!
C ignores A, and purchases from B. A then sues to quiet title.
C wins between A-C because C is sheltered from not being a bona-fide purchaser, even though A
told him of what happened.
C enjoys the BFP status of B from the A-B sale.
Ex: O sells to A and B, both as BFPs. B records, then A records. B then mortgages the property to
D. Finally, B sells to C, who sees the prior transactions involving A and D when searching title but
purchases anyway. A and D seek to assert their claims. Will they win?
A will lose because C enjoys BFP status with respect to the early sale.
D will win because C does not enjoy BFP status with respect to the mortgage.

Part III: Ownership and Possession

A. Sequential Ownership: Present


Estates and Future Interests

Perpetual right right of possession NOW.


Future interest you already have the right, but in the future!
REVERSION is always retained by the grantor
REMAINDER is always created in someone other than the grantor

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Defeasible FEE SIMPLE Estates:


Fee Simple Determinable
o Ends automatically. To B and his heirs until people land on Mars. The right to
possession automatically reverts back to the grantor.
Fee Simple Subject to a Condition Subsequent
o Ends with Grantors decision to re-enter. To B and his heirs, but if people land
on Mars then the grantor may retake the possession.
o RULE: No re-entry by self-help unless it can be accomplished peaceably.
o Therefore: If the person in possession refuses to voluntarily turn over his valuable
estate, the solution is to bring an action in EJECTMENT.
o An action in ejectment (i.e., an action to recover possession of real property) is
today the normal way to exercise a right of re-entry.
o Indifference to the breach--and, even, approval of it--would almost certainly
constitute a "waiver" of the right of re-entry. Courts are rather alert to find such
waivers, so they can avoid the "forfeiture" of the estate.
Fee Simple Subject to an Executory Limitation (Fee Simple on Executory Limitation)
o Ends automatically, but Grantor does not get it. To B and his heirs, but if people
land on Mars then to C and his heirs.
o Thus, there are actually 2 types of fees simple on executory limitation:
fee simple subject to an executory limitation <divested>
fee simple followed by an executory limitation <expires>
One is limited by words of condition, and the other by words of
duration

Fee simple

Terminates

Land Goes
to:

Future Interest

determinable

automatically

grantor

possibility of
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reverter
on condition
subsequent

grantor's
election

grantor

right of re-entry *

on executory limitation

automatically

3rd party

executory interest

REVERSIONS and Particular Estates

A reversion is:
a future interest
retained by the grantor
to follow a particular estate
when the particular estate expires
"to Oliver Olympio while he lives on the land."
"to Tybald Teleman for 10 years until there shall be a breach of any of the terms or
covenants herein."
The two above are "determinable" particular estates (analogous to the fee simple
determinable). Specifically:
a determinable life estate
a determinable term of years

Those below create particular estates subject to a condition subsequent (analogous to fee
simple on condition subsequent). Specifically:
a life estate on condition subsequent
a term of years on condition subsequent
"to Oliver Olympio for life on the condition that he lives on the land, but if he
does not, then I may, at my option, re-enter and take back the land."

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"to Tybald Teleman for 10 years; but in the event that the lessee shall breach of
any term or condition of this lease, the lessor may immediately thereupon, or as
soon thereafter as practicable, re-enter and resume possession or maintain
proceedings to recover same."
A right of re-entry that cuts off a "particular" estate, i.e., right of re-entry "incident to" a
reversion, is always transferable together with the reversion itself.
EXAMPLE:
Leek owns an apartment building, with units leased to various tenants. Leek sells the building to
another investor (meaning that Leek conveys the reversions since the tenants hold the
possessory interests). The buyer would also get the rights of re-entry under the tenants' leases.
They are RIGHTS OF RE-ENTRY INCIDENT TO A REVERSION.

REMAINDERS
Remainders come in 2 basic kinds:
vested remainders, and
contingent remainders
And vested remainders fall into 3 basic subcategories:
indefeasibly vested,
vested subject to divestment, and
vested subject to open
1. Vested Remainder Absolute (or VR in FSA)
2. Vested Remainder Subject to Total Divestment (or VRS to an Executory Interest)
3. Vested Remainder Subject to Partial Divestment (or VRS to Open)

These can be important distinctions: For example, as we'll see, the Rule Against Perpetuities
can only invalidate "contingent" remainders and remainders "subject to open." The Rule doesn't
apply to remainders that are either "indefeasibly" vested or vested "subject to divestment."

CONTINGENT REMAINDER
A CONTINGENT REMAINDER is one in which the remainderman's right to immediate possession is
subject to a condition precedent.
For example: "to A for life, remainder to B and her heirs if B marries C."
B doesn't get possession unless something happens first (she's got to marry C).
If there's not a remainderman entitled to take possession until something further happens (in
addition to expiration of the prior estate), then the remainder is also "contingent."
There are 3 basic ways that a remainder can be "contingent."
1. Subject to occurrence of some stated event - "... remainder to B and her heirs if B
marries C"
B must first marry C
2. To unascertained persons -- "... remainder to B's first child to reach age 21, and his or her
heirs"
one of B's children must reach age 21
3. To unborn persons -- "... remainder to B's next born child and his or her heirs"
another child must be born to B

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Some CONTINGENT remainders:


1. "to B for life, then to C's heirs"
This is the classic contingent remainder. Nobody has "heirs" until they're deceased.
Living persons have only "heirs apparent." As long as C is alive, C's actual heirs are
unascertained.
2. "to B for life and then, if C survives B, to C and his heirs"
Surviving the prior estate holder is probably the most common type of stated event
found in contingent remainders.
3. "to my wife, Sarah, for life, then to my first grandchild"
If the grantor doesn't have any grandchildren yet, this would be a contingent
remainder to unborn persons.

Vested Remainder
DEFINITION of a VESTED REMAINDER (long-form):
A remainder is vested if the remainderman is:
(a) born and
(b) ascertained, and
(c) no (stated) event need occur before possession (except expiration of the
prior, particular estate).
DEFINITION of a VESTED REMAINDER (short-form): A remainder is vested if it's not
contingent.
THREE VESTED REMINDERS:
Indefeasibly vested, Vested Remainder Absolute (or VR in FSA)
Vested subject to divestment, Vested Remainder Subject to Total Divestment (or VRS to an
Executory Interest)
Vested subject to open Vested Remainder Subject to Partial Divestment (or VRS to Open

Vested subject to divestment (VRS to an Executory Interest):

REMAINDER

SUBJECT TO

Contingent

Condition Precedent

Vested Subject to Divestment

Condition Subsequent

For example, "to A for life, remainder to B and his heirs, but if B does not reach the age
of 21, then to C and his heirs."
1. Here there's no "condition precedent" -- no pre-condition -- to B's right to possession,
so B's remainder is vested.
2. There is, however, a condition under which B's vested remainder can be cut off. It's a
"condition subsequent."
3. Because the condition subsequent can cut off B's vested remainder, we say the
remainder is VESTED SUBJECT TO DIVESTMENT.
1. "to B for life, then to C and his heirs, but if C dies before B, then to D and her heirs"
2. "to B for life, then to C and his heirs, but if C dies childless, then to D and her heirs"
Note that in each of the above conveyances:
C has a remainder that is vested (C is born, ascertained and can take without preconditions),
but, C's remainder is subject to divestment if a stated event occurs.

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If these conveyances to C remind you a lot of the typical words to create a FEE SIMPLE ON
EXECUTORY LIMITATION, you're right. That's exactly what they do. The estate of C's remainder is,
in each conveyance, a FEE SIMPLE ON EXECUTORY LIMITATION.
VESTED REMAINDERS SUBJECT TO PARTIAL DIVESTMENT (SUBJECT TO OPEN)
Remainders are designated as VESTED SUBJECT TO OPEN when they are:
to a class of recipients (e.g., "remainder to my children"), and
at least one member of the class is born and ascertained, and
other members may be added to the class later.
"To B for life, remainder to B's children and their heirs"
If B has one or more living children, this remainder is "vested." But it's nonetheless subject to
partial divestment -- "subject to open"-- as more people are added to share the same pie.
B may have more children before he dies. Hence the subject to partial divestment part of the
property will go to each child born to B.
REVIEV:
REMAINDER

SUBJECT TO

Vested (indefeasibly)

No Conditions

Contingent

Condition Precedent

Vested Subject to Divestment

Condition Subsequent

EXECUTORY INTEREST
CANNOT be a remainder!
A remainder must follow:
(1) immediately
(2) after the expiration
(3) of a prior particular estate.
That is:
1. Remainders can only follow particular estates.
A remainder can never directly follow a fee simple.
2. Remainders must wait until the prior particular estate expires.
A remainder can never divest ("cut short") another estate.
3. Remainders have to follow particular estates immediately, without any "gaps" in
which possession reverts to grantor.
A remainder can never directly follow possession by the grantor.
These are the three "nevers."

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An executory interest is:

a future interest

in someone other than the grantor

having one or more of the following features:


o

it directly follows a fee simple, and/or

it divests ("cuts short") the prior estate, and/or

it directly follows possession by the grantor

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"to E and his heirs beginning 2 years from the date hereof"
"to E and his heirs beginning from and after my death"

Destructibility Doctrines

pp. 778-793

FUTURE INTEREST - DESTRUCTIBILITY


Courts do not like future interest going too far.
Families come up with ways to keep land in hands of the family for as long as possible.

1) The Rule of Destructibility (of CRs)

2) Doctrine of Merger (of CRs)

3) Rule in Shelleys Case (NOT Shelleys Rule)

4) Doctrine of Worthier Title

5) Rule Against Perpetuities

If a CR does not vest at the expiration of a LE (or preceding estate), the CR is


destroyed.
Destructs interest if it goes too far.
Example:
A:

To A for life, then to B if B


LE
reaches 21.

B:

CR

O:

Reversion

B has not met condition precedent before the end of As LE.


Thus, Bs CR is destroyed.

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Today, like the dinosaur, the doctrine is extinct in the United States.
John Sprankling
Doctrine of Merger (of CRs)
O creates a LE in A and a CR in B, and
A subsequently conveys the LE to O,
Bs CR is destroyed
Doctrine of Worthier Title
Applies to inter vivos (between the living) conveyances that purport to create a CR or
an EI in Os heirs.
DWT destroys future interest in Os heirs and
Creates instead a reversion in O
Without DWT:
To A for life, then to Os heirs
Os heirs have a reminder. O is alive, so we dont know who Os heir is.
A: LE
Os heirs CR
Original Owner: Reversion.
Here we do not know Os heirs until O dies.
WITH DWT:
A: LE
Os Heirs nothing
O holds Reversion

DWT destroys the future interests in Os heirs, and

Creates instead a reversion in O.

Rule in Shellys case:


The Rule in Shelleys Case creates a VRA in A after As LE.
That is ALL the Rule in Shelleys Case does!
Courts then apply the doctrine of merger.
Thus: To A for life, then to As heirs =

To A.

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Puts them together. Merges to Fee Simple Absolute.


Cannot go that far, keep it in the family hands. Reversion for A.

To A for life, then to B for life, then to the heirs of A


The doctrine of merger does not apply here.
There is an intervening interest.
Thus, A does NOT have a FSA.
This without Shelly Rule:
A: LE
B: VR in LE
What will B have?
As heirs CR.
WITH Rule in Shellys Case (RSC)
A: LE
B: VR in LE
As heirs nothing
A: VR in FSA
The doctrine of merger does not apply here.
There is an intervening interest.
Thus, A does NOT have a FSA.

That rule is a relic, not of the horse and buggy days, but of the preceding stone cart and
oxen days.
Sybert v. Sybert, 254 S.W. 2d 999 (Tex. 1953)(Griffin, J., concurring)

THE RULE against Perpetuities


The Big Daddy/Mama of destructibility doctrines.
A rite of passage for law students.
Prior to 1886, lots of rules against perpetuities.
In 1886, Harvard law professor John Chipman Gray writes a treatise and coins
the new rule.

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Classical rule:
No interest is good unless it must vest or fail, if at all, not later than 21 years after
some life in being at the creation of the interest.
(p. 780)

[Gray took] a great field of property law like Perpetuities and confined it to a narrow,
mechanistic rule against remoteness of vesting that he came to exalt as if it were an
end in itself.
This rule is about remoteness of vesting. If it goes too far we will destroy it.
Someones life + 21 years. If it will not vest in this time, goes too far.

Originally, RAP was a harshly applied rule.


Recent reforms, e.g.:
1) Wait and See
Court will wait and see if it vests (not too far)
2) Cy Pres
Rewrite?
3) Uniform Statutory Rule Against Perpetuities
Will the interest fail or vest within 90 years of creation?
Applicable future interest:
1) Contingent Remainders
2) Executory Interests
3) VR Subject to Open/Partial Divestment
Where O holds interest this doesnt apply.
PE

FS

EI

FSA
FSD

POR in O

FSSCS

ROE

FSSEI

EI in SP

No gap in the timeline of Vested Reminder.


We concerned about if there is a gap between Vested Reminder.
CR yes
VRSPD yes

20

EI yes
GOAL:
To determine whether there is any possibility at all that the FI will vest more than 21 years
after the death of everyone alive, named, and/or identified at the creation of the interest.
O|----------| GAP |----- VR
Terminology:
Creation of the Interest (p. 782)
Inter Vivos:

At the moment of sale, delivery, or gift.

By Will (Devise):

At testators death.

Vest
When the condition that made the future interest contingent or uncertain to come into being
occurs.
To A, but if the property is not used for residential purposes, then to B.
Bs EI will VEST, if at all, when the property is no longer used for residential purposes.
Vest
To A for life, then to B if B graduates from law school.
Bs CR will VEST when B graduates from law school.
Bs interest will become POSSESSORY only when A dies.
Vest, if at all
Forever fail to vest
To A for life, then to B if B graduates from law school.
Bs CR will forever fail to vest, if B dies without graduating from law school.
Satisfies rule of perpetuity.
Lives in Being
Those people alive and/or identified in the instrument at the creation of the interest.
To A for life, then to B, but if B does not turn 21, then to C.
A, B, and C are lives in being.
If the conveyance is inter vivos, so is O.
To A, then to Bs kids who turn 21.
B is alive and has one child, C, who is 21. After the time of conveyance, B has another child, D.
A, B, and C, are lives in being. Measuring Life!
D is NOT a life in being at the time of conveyance.
Why lives in being so important:
ID measuring line for perpetuity.

21

Measuring Life
Anyone alive at the creation of the interest who can be used to measure the perpetuities period.
If we do not know after end of measuring life if it will vest within 21 years, Interest is Destroyed.
Validating Life
The measuring life within whose lifetime +21 years the future interest is CERTAIN TO
VEST
Thus SATISFYING RAP!
ID the Masuring and Validating Lives:
A person in the conveyance causally connected to the vesting of the interest, including
potentially:
1) Holder of the interest.
2) Person creating the interest.
3) Any person who can affect a condition precedent.
4) Any person who can affect the identity of the interest holder.
All potential measuring Look for them in ID Measuring and Validating lives.

Example:
To A, but if the property is no longer used for school purposes, then to B.
Who can affect the condition who is alive at the creation of the interest?
A is the measuring life.
A is NOT a validating life.
HOW DO WE KNOW IT?
Kill A and see if EI of B will vest within 21 years? We dont know for sure. It is possible
that it will not vest.
B Interest may not vest within RAP.
Bs EI will NOT necessarily vest within 21 years of As death.
Thus, A is a measuring but not a validating life.
If the creative legal mind can invent any possible scenario under which the interest
might first vest after the perpetuities period expires no matter how unlikely the
scenario is the interest is invalid.
In other words, BE CREATIVE in how you kill off the lives in being at the creation of the
interest.

Profs five step process in evaluating:


Step One:

Determine whether the FI is subject to RAP.

22

1) CR
2) EI
3) VRS2O
Step Two:

Identify the Measuring Life.

Who is causally connected to the vesting of the interest?


1) Holder of the Interest.
2) Person who created the interest.
3) Any person who can affect a condition precedent.
4) Any person who can affect the identity of the person.

Step Three:

Will the FI vest or forever fail to vest within the perpetuities period?

If the answer is YES, the FI satisfies RAP and is VALID. Stop here!
If the answer if NO, the FI violates RAP and is VOID. Go to Step
Four.

Step Four: Strike out the language with the FI.


Step Five: Reconstrue the conveyance with the remaining language.
EXAMPLES:
TO A so long as the property is used for residential purposes, then to B.
1) B has an EI. RAP applies
2) A is the only one who can affect the condition for Bs EI to vest, thus A is the
measuring life.
3) Kill A. Will Bs EI Vest or Forever Fail to vest within 21 years of As death?
NO. Move to step 4.
4) Strike out the language including Bs EI.
THEN TO B strike out.
5) Reconstrue the remaining language:
A:

FSD

O:

POR

To A so long as the property is used for residential purposes

To A, but if the property ceases to be used for residential purposes, then to B.


3) Kill A
4) Strike out.

23

5) Reconstrue the remaining language.


A: FSA
O: Nothing.
Just To A

To Lindsey so long as she does not fail a drug test, then to Paris. But if Paris is
convicted of cocaine possession, then to Cheech and his heirs.
L: FSSEI.
FSD
O: POR
L: FSSEI
P: EI.
C: EI

Step 1.
Step 2: L to P and P to C measuring life.
L: Affects condition for Ps and Cs EIs to Vest
P: Affects condition for Cs EI to vest.
Step 3:
Kill L
Will Ps EI vest or forever Fail to vest within 21 years of the death of L?
At Ls death we will not know if she failed drug test. Goes to P!
Satisfies rule of perpetuity.
Stop here.
Step 3 for Paris:
Kill P will it vest?
YES. Satisfies RAP.
Stop here.

Will EI vest or forever fail?


FSSEI Rule of RAP applies.
M: FSSEI
A: EI
Step 2.

24

Measuring Life M.
Mel is the only life in being, who can affect the condition for Alices EI to vest.
Step 3.
Kill M.
WE WANT TO KNOW for certain if EI vests or Failr to vest within 21 years of death.

M: FSA. Just To Mel.


To Ava for life, then to Bettes kids who turn 25.
At the time of conveyance B is alive and has one child, Claude, who is 19.
A: LE
C: CR
Other kids: CR
B: Nothing

VRSPD at least 1 party has to be VESTED. 25 years in this case.


CR: When no one in the class is yet to be vested.
RAP applies.
Step 2.
A measuring life
As death.
B Measuring life. Can affect class
C could be measuring life. But our goal: To find any way that the future interest could
vest beyond
Kill B (and C)
21 years after Bs death
IN THIS CASE the court can redraft to 21.
Yes. Violates RAP.
Step 5: Strike out.
A: LE
O: Reversion

Leave: To Ava for life.


BUT we can wait and See.. Cy Pres.

25

WASTE
A life tenant has a duty not to WASTE
Waste an abuse or destructive use of property by one in rightful possession
Voluntary Waste
Results from an affirmative act that significantly reduces the value of the property (demolishing a
valuable house)
Voluntary waste.
From hypo can sue to stop or get damages.
Permissive Waste
Results from failure to take reasonable care to protect the estate.
Failing to make minor repairs or pay property taxes
Duty to do repairs, pay property taxes, in life estate.
Failure to eject adverse possessor? Nope. Adverse possessors cannot adversely possess future
interest. Future interest is not possessory.
Ameliorative Waste
Results from an affirmative act that leads to a substantial change in the property and increases
its value.
Building a swimming pool
If there is a complete and permanent change of surrounding conditions that has deprived the
property of its value and usefulness, then one can change the property
Waste change in the condition of the property
Decreases the Value/Utility of the property.
Or increases
Hypo:
What if the property is no longer economically viable or personally useful in its prior form?
To D for life, then to J when J graduates from law school. If J does not graduate from law school
then to Alexa.
Currently J is 25 years old and attends college, where she is majoring in political science.
Can J sue to prevent D from tearing down the guest house?
WASTE: All future interest holders are NOT the same.
If Indefeasibly Vested Remainderman (VRA)
Can sue for Damages or Injunction to prevent future waste.
If Contingent reminder cannot sue for Damages, but can sue for INJUNCTION.

26

Hierarchy of protection (against waste)


Executory interest Holder
No for Damages,

B.
1
2

Simultaneous Ownership: Co-Ownership


The Tenancies (TIC, JT, TE)
Rights, Duties, and Responsibilities
1 Rent and Possession
2 Transfer by One Co-Owner
3 Partition

pp. 661-668
pp. 668-674
pp. 674-687
pp. 687-693

The Separation of Possession from Ownership: Landlord-Tenant


Law

Leaseholds
Non-freehold estates
Term of Years tenancy
Has a fixed duration agreed upon in advance

Once term ends, tenants possessory rights automatically expire and landlord may retake
possession of premises
Usually used in commercial leases and often seen in residential leases
death of either doesn't terminate tenancy
LL can't evict tenant before end of term unless tenant breaches material term of lease
Periodic tenancy
Automatically renewed for successive periods unless the landlord or tenant terminates the
tenancy by giving advance notice
Month to month periodic tenancies are frequently used in residential leases
death of either doesn't terminate tenancy
to evict, LL must give requisite notice that tenancy will not be renewed
Tenancy at Will
No fixed ending point
Continues so long as both the landlord and tenant desire
Most states require advance notice to end this tenancy, usually equal to period between rent
payments

27

But MAY be ended without notice in some.


Tenancy terminates automatically if either party dies, the tenant abandons possession, or
landlord sells property
T leases Greenacre for as long as both of us wish
Tenancy at Sufferance
Created when a person who rightfully took possession of land continues in possession after that
right ends.
Arises from the occupants improper conduct, not from an agreement.
More a convenient label for a type of wrongful occupancy than a true estate.
In this case, tenant would become a holdover tenant
Landlord may either:
Treat T as a trespasser and evict him
Renew Ts tenancy for another term.
Some states require double rent during holdover period while others limit length of the renewed
tenancy to no more than one year, although most states have abolished or limited the second
option to avoid unfairness to the tenant.
Note: most states require leases of 1+ yrs be in writing (SoF)
Case: Vasquez v. Glassboro (page 11)
farmworker not tenant; just licensee

Rights, Duties, and Remedies


Occupancy
i. LL's duty to deliver possession
1.
majority: must deliver possession
if prior tenant is holdover, LL's responsibility

to evict
If when new tenant arrives and there is a holdover LL breached the
contract. New tenant can break the lease, sue for damages incurred in
search of another lease, or keep the lease and withhold rent for the
duration of holdover, and recover cost for alternative lease during the
holdover.
2.
minority: must deliver only right to possession
prior holdover tenant eviction problem of
new tenant

3.

ii. Access
1.

LL has the right to enter to make repairs. WITH


consent of the Tenant. Tenant shall not unreasonably withhold his consent.
2.
Without consent: In emergency
3.
LL shall not abuse this right.
4.
LL may not enter for any other reason except for

28

court order.
do repairs.
property.

5.

LL may enter if Tenant is absent for a long time to

6.

Or when Tenant abandoned or surrendered the

iii. Tenant has right to visitors and has right to Marry and
live with a spouse.
LL has right to limit to 1 roommate.
iv. Tenant duty to not do waste and nuisance.
v. If LL sells land
Lease still survives.

Tenant's right to assign/sublet


When lease is silent, tenant may transfer by assignment or sublease
Lease may require LL consent for sublease
Commercial leases
i.
majority rule: LL has absolute
right to refuse sublease if in lease
1. case: Slavin v. Rent
Control Board (MA)(page 12) majority rule

ii.

minority rule: consent can


only be withheld if commercially reasonable objection to
assignment
1. Case: Kendall v. Pestana
(CA)(page 12) minority rule

Residential leases
i.
LL has absolute right to refuse

sublease
Sublease
Tenant has executed new lease with subleasee.
Landlord remains involved, tenant is liable to landlord for any damages or lost rent incurred by
subleasee.
More common in residential settings.

Rent and Landlords Duty to Mitigate


i. LL Self-Help to deal with breaching tenant not allowed in most
jurisdictions

ii. Summary Process fast-track for eviction proceedings


Tenants can now present defense, not as

much Summary as it was before.


iii. Remedies when tenant breaches and refuses to leave

29

1.

2.

possession

Tenant stops paying rent


sue for back rent
sue for possession
Tenant keeps paying rent
accept new tenancy
treat as tenant at sufferance and sue for

i.
refuse to accept or cash
tenant's rent checks
iv. Remedies when tenant breaches and leaves
1.
accept tenant's surrender
tenant still owes back rent but no future
losses
2.
re-let on tenant's account
find new tenant and sue former tenant for
difference between old and new rental prices (must be reasonable)
3.
wait and sue for rent at end of lease (don't mitigate
damages)
traditional rule allows this
most states use modern rule (LL must
reasonably try to mitigate)
i.
if LL mitigates, can recover
reasonable costs of finding new tenant, rent during vacancy, and diff.
between rent prices
ii.
if not, damages reduced by
amount that would have been avoided by reasonably attempt to mitigate
LL has the burden to show that he tried to Mitigate or Mitigated!
iii.

Case: Sommer v. Kridel


1. A landlord has a duty
to mitigate damages by making a reasonable effort to re-let the
premises when seeking to recover rent from a defaulting tenant. Such
a duty is consistent with basic justice and fairness. There is an
increasing trend to treat leases not as conveyances of land, but as
contracts.

Habitable Premises
Quiet Enjoyment & Constructive Eviction
1
Covenant of Quiet Enjoyment

Implied in all leases, whereby landlord


promises not to wrongfully interfere with tenants possession of premises.

Constructive eviction
Special protection for the tenant in defective leased premises
When the wrongful conduct by the landlord substantially interferes with tenants beneficial use
and enjoyment of leased premises.
Wrongful conduct may be satisfied by an act or omission. Cases have found this standard is met
where the landlord:

30

Fails to perform an obligation in the lease


Fails to adequately maintain and control the common area
Breaches a statutory duty owed to tenant
Fails to perform promised repairs
Allows nuisance-like behavior
Allows tenant to vacate premises and end the lease, avoiding future liability for future rent
Over time evolved to include any conduct by landlord other than actual eviction that might
substantially interfere with the tenants possession.
Procedural Steps: (1) Tenant must notify landlord about the problem and (2) give the landlord
reasonable period to act upon the problem, (3) and then vacate premises.
Case Examples:
Fidelity Mutual Life Insurance Co. v. Kaminsky Court held landlords failure to prevent
protestors from interfering with tenants practice constituted constructive eviction. (nuisance like
behavior)
Violating 2 codes may not be sufficient. But violating A LOT may be!
Partial constructive eviction
portion of apt is unusable

same as above, but can be used if only

i.
doesn't force tenants in bad
situation to live on street in order to sue LL
LL's liability for acts of other tenants
traditional rule: LL not responsible unless lease expressly incl. obligation to control conduct of
other tenants
Modern rule: If landlord fails to protect Tenants quiet enjoyment
2

Implied Warranty of Habitability


Doctrine to protect residential tenants from defective housing conditions
More general, such as clean, safe, and fit for human habitation. Need bare living conditions
and compliance with building and housing codes.
Procedural Requirements:
Tenant must notify landlord about defects.
Allow reasonable time for landlord to make repairs.
Tenant not required to vacate.
Remedies for breach:
Withhold rent
Usually most effective remedy because it gives the landlord an incentive to repair the premises.

31

Repair and deduct


In many states, the tenant may withhold rent and use these funds to repair the defects.
Sue for damages
Tenant may sue for damages while remaining in possession or after vacating premises.
Can also move out if LL had a notice and reasonable time to repair.
Case Examples:
Wade v. Jobe Court held in residential lease, an implied warranty of habitability exists and
bare living requirements must be met, and the premises are fit for human occupation during the
duration of the lease. Failure to supply water or heat, or violations involving safety and health will
often sustain a tenants claim for breach of warranty of habitability.

Retaliatory Eviction

pp. 886-891, 893-898

Evidence of complaint within 6 month of the alleged act of retaliation is


presumptively retaliation.

Retaliatory eviction; consumer protection legislation.


Rule: Landlord cannot evict tenants if the motive is to retaliate against the
tenant for taking action pursuant to their housing rights.
Factors to be used to judge whether a defense of retaliatory eviction is
established.
o The landlords decision was a reasonable exercise of business
judgment;
o The landlord in good faith desires to dispose of the entire leased
property free of al tenants;
o The landlord in good faith desires to make a different use of the
leased property;
o The landlord lacks the financial ability to repair the leased
property and therefore, in good faith, wishes to have it free of
any tenant;
o The landlord was unaware of the tenants activities which were
protected by statute;
o The landlord did not act at the first opportunity after he learned
of the tenants conduct;
o The landlords act was not discriminatory.
Cases:
Hillview Associates v. Bloomquist (p.759)
o History: Members of a tenants committee met with their mobile
home park maintenance supervisor to complain about the
conditions. During the meeting, tenant Davenport got into a
physical altercation with the manager. Later, members of the
committee received eviction notices.
o Opinion:
Landlord may evict tenants for legitimate purposes or no
reason at all.
However, if the landlord has an illegal intent to prevent
tenant from pursuing their legal activity by eviction, the
landlord is guilty of retaliatory eviction.

32

Here, evidence supports that the supervisor evicted the


committee because they complained about the conditions
of the park, a legal activity.
However, the supervisor could evict Davenport because
he crossed the line of legal activity.
Imperial Colliery Co. v. Fout (p.765)
o History: Fout worked at Milburn Colliery Company as a coal
miner and leased a house from Imperial Colliery Company. Fout
alleged that the two company are the same. Fout received
notice that his lease will be terminated and Fout claimed that he
is being evicted in retaliation for his participation in a
demonstration against Milburn.
o Opinion:
Retaliatory eviction enables the tenant to exercise their
right of habitability by complaining about unfit conditions
without fear of reprisal by his landlord.
Here, however, Fout points to an activity that triggered his
eviction which was unrelated to the habitability of his
premises. Retaliatory eviction defense must relate to
activities of the tenant incidental to the tenancy. Fout
failed to show that his eviction is related to the tenancy.

Discrimination
Fair Housing Act Statute
Refuse to sell or rent after making a bona fide offer; or to refuse to negotiate for the sale or
rental of, or otherwise make unavailable or deny a dwelling to any person because of race, color,
religion, sex, familial status, or national origin.
To discriminate against any person in terms, conditions, or privileges of sale or rental of a
dwelling, or in the provision of services or facilities in connection therewith, because of race,
color, religion, sex, familial status, or national origin.
To make, print, publish, or cause to be made, printed or published, any notice, statement or
advertisement with respect to the sale or rental of a dwelling that indicates any preference,
limitation, or discrimination based on race, color, religion, sex, handicap,, familial status, or
national origin, or an intention to make such preference, limitation, or discrimination.
Protected Groups
Race, color, religion sex, familial status (married/unmarried couples, reluctance to rent to single
mothers), or national origin (immigrants).
Unprotected Groups
Sexual orientation, age, employment status, professional status.
Disability Discrimination
Cant discriminate sale or rental because of a handicap.
Permitted Modifications:
If resident needs to change the premises, landlord can do so at residents expense and must
restore it to the way it originally was.

33

Two Exemptions:
Rooms or units in dwellings occupied by no more than four families living independently.
As long as the owner occupies one of the units as a resident.
Single family house sold or rented by owner (not an agent/broker).
As long as owner does not own more than three such homes, and no more than one sale very
two years.
FHA Remedies
Damages
Injunctions
Punitive Damages
Criminal penalties, including attorney general investigations.
Mediations.
Showing a Violation
Step 1: Make a Prima Facie Case
Statistical evidence of systematic discrimination due to conduct.
Rejection of qualified applicant in a protected class.
Disparate treatmentunwarranted rejection of individuals in protected classes.
Step 2: Defendant may offer legitimate explanation
Exogenous cases: External demographics of location and endogenous causes, such as low credit
scores.
Lack of objective qualifications.
Burden on defendant to prove this.
Step 3: Plaintiff may rebut the explanation as a pretext.
Intentional discrimination always meets this standard.
Racial Discrimination
1
Asbury v. Brougham
Refused black lady rent. Suggested to go to a mostly Black unit.
P must prove DISCRIMINATORY INTENT
Was there DISCRIMINATORY INTENT?
P burden to prove to demonstrate PRIMA FACIE CASE
Burden on LL to demonstrate legitimate considerations.
Shifts to P to demonstrate pretext.

34

2
3
Sex Discrimination: Sex Harassment
Quigley v. Winter
Types of harassment:
o Hostile Environment
o Quid Pro Quo (refusing to give security deposit unless he saw her naked?)
Prima Facie Case:
o Member of a protected class
o Subject to unwelcome sexual conduct
o Tangible terms/conds. of situation adversely change.
o Change casually connected to rejection.
Sexual Orientation Discrimination
Sexual Orientation Discrimination
Not protected by Federal law.
Protected by state statutes.
Part IV: Regulating the Use of Property

The Judicial Regulation of Property: Nuisance and Support Rights


1. Unreasonable Uses
pp. 333-342, 346-353,
365-366
2. Remedies
TWEN; pp. 353359; 376-388
3. Support Rights
a. Lateral
pp. 401-409
b. Subjacent

The Private Regulation of Property: Servitudes


1 Affirmative Easements (Rights)
1 Express Easements
i. Appurtenant
ii. In Gross
Non-Express Easements
1 Estoppel (Irrevocable Licenses)
2 Prescriptive Easements
3 Implied by Prior Use
4 Implied by Necessity
c. Modification and Termination

pp. 409-419

pp. 511-518?<>
pp. 518-522
pp. 522-533

pp. 533-544
pp. 311-318
pp. 544-551
pp. 551-556
p. 556

Covenants (Restrictions)
35

A.

Real convenants and equitable servitudes


1.
General: Private contracts between landowners regarding rights and
restrictions of properties that will also bind successors to the properties.
a)
Usually must be in writing.
b)
Writing requirement is also satisfied by a constructive notice: the
writing requirement is satisfied if the covenant is recorded in an earlier
instrument.
c)
Covenants and equitable servitudes are land use restrictions that are
binding on future owners, or run with the land. Covenants are
property interest because they are binding on current and future
property owners.
d)
Exception: implied reciprocal negative servitudes, see below.
2.
Restrictions running with the land
a)
Rules for running with the land for equitable servitudes.
(1)
The burdened side: The question is whether an owner of the
servient estate is burdened by a restriction on the lot that the
owner did not herself agree to when she accepted his deed from
the seller.
(a)
restriction is in writing,
(b)
the parties bound or benefited had notice of the
restriction,
(c)
the grantor intended the restriction to run with the
land,
(d)
the restriction touches and concerns the land.
(2)
The benefited side: The question is whether the plaintiff has
standing to enforce the burden. Most courts hold that a person
is entitled to equitable servitude if
(a)
she owns real property
(b)
that the grantor who imposed the restriction
intended to benefit by the restriction.
b)
Rules for running with the land for real covenants.
(1)
The burdened side: Must have all the elements
(a)
restriction in writing,
(b)
the parties bound or benefited had notice of the
restriction,
(c)
the grantor intended the restriction to run with the
land,
(d)
the restriction touches and concerns the land,
(e)
horizontal and/or vertical privity of estate.
(2)
The benefited side: Must have all the elements
(a)
restriction in writing,
(b)
the parties bound or benefited had notice of the
restriction,
(c)
the grantor intended the restriction to run with the
land,
(d)
the restriction touches and concerns the land,
(e)
the plaintiff derive her title from one of the
covenanting parties,
(f)
horizontal and/or vertical privity of estate (optional
depending on the state).
c)
Definition of terms
(1)
Writing
(a)
A covenant is in writing if the original covenanting parties
put it in writing.

36

(b)
(2)

(3)

(4)

(5)

Subsequent purchasers need not put the covenant in


writing to satisfy the requirement for the original
covenant to run with the land.

Notice
(a)
Actual notice: Notice is served directly to the purchaser.
(b)
Constructive notice: Covenant was recorded in the
registry of deeds along with the deed or lease creating the
covenant. A reasonable purchaser is expected to search
the title to find out whether the party is burdened by
restrictions.
(c)
Inquiry notice: If the observable conditions on the land as
such that any reasonable purchaser would know the
property was burdened by a covenant.
Intent to run with the land
(a)
A deed or lease is evidence of grantors intent that the
restrictive covenant to run with the land if it
(i)
recites that the covenant is made to the grantee
and her heirs or assigns or
(ii)
explicitly states that the covenant is intended to
run with the land.
(b)
Presumption: the court will generally hold that a
covenant benefiting the owner of neighboring land is
presumptively intended to run with the land.
Touches and concern the land
(a)
Traditionally the test required that
(i)
the covenant is connected to the enjoyment or the
use of the land.
(b)
Modern test required that
(i)
the covenant affects the market value of the land,
(ii)
(in some states) the restriction affects the parties
interest as landowners such that the benefits and
burdens could not exist independently of the
parties ownership interest in real property.
(c)
Note: The courts has traditionally used this element to
void restrictions on competition instead of a public policy
argument. However, the courts today recognize that
restriction on competition
Privity of estate: All states require both horizontal privity and
vertical privity for the burden of a covenant to run with the land.
Some states require privity for standing.
(a)
Horizontal privity: The relationship between the original
covenanting parties.
(i)
Tests for horizontal privity.
(a)
Instantaneous privity: the prevalent test that
require the plaintiff to show that the
covenant was created at the moment one of
the parties transferred a property interest to
the other.
(b)
Mutual privity: the minority test that states
privity exists if one of the parties holds an
easement in the land of the other.
(ii)
Examples where horizontal privity is not met.
(a)
Agreements between neighbors.
(b)
Agreements between grantors and grantees
that are not made at the same time as the

37

(6)
(7)

conveyance of the property interest


burdened or benefited by the covenant.
(b)
Vertical privity: The relationship between the original
covenanting parties and subsequent owners of each
parcel.
(i)
Test for vertical privity:
(a)
To establish vertical privity, prior owners
must not retain any future interests in the
property when they alienate in to later
owners.
(ii)
Examples where vertical privity is not met.
(a)
The transaction to a subsequent owner
involves a leasehold or life estate, such that
the grantor or some other person has the
right to possess the property in the future.
Look at example on P.450.
Cases
(a)
Whitinsville Plaza v. Kotseas (p.438)
(i)
History: Kotseas conveyed land to the Trust and
promised not to use the retained land in
competition with e Trust. The Trust sold land to
Plaza. Notwithstanding the promise, Kotseas
proceeded to lease land to CVS for the purpose of
carrying on competitive business with Plaza.
(ii)
Opinion
(a)
The courts have traditionally held that a
covenant not to compete does not touch
and concern the affected parcels of land
and does not run with the land.
(b)
The court feels it is the right time to overrule
the previous touch and concern rules
because it failed to consider that restricting
covenants enhances the market value of the
property.
(c)
Reasonable anticompetitive covenants are
enforceable by and against successors to the
original parties.
(d)
Reasonable covenants against competition
may be considered to run with the land when
they serve a purpose of facilitating orderly
and harmonious development for commercial
use.
(e)
Enforceable covenants will be ones which is
consistent with a reasonable overall purpose
to develop real estate for commercial use.
(f)
Covenants is enforceable if it is reasonably
limited in time and space and consonant with
the public interest. Unreasonableness in
time, space, or product line, or obstruction of
the public interest, are the principal bars to
enforcement.
(g)
Kotseas has been properly compensated for
giving up his right to compete with Plaza and
it would be inequitable to allow Kotseas to
engage in competition and be further
unjustly enriched.

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(h)

3.

Plaza relied on Kotseass covenant not to


compete and have developed his property
accordingly. The covenant increased the
value of the property.
Implied reciprocal negative servitudes
a)
General: The court will allow covenants not directly incorporated into
the deed for two instances:
(1)
Equitable estoppel/part performance: Representations are
implied in sales literature or made orally by the developer that
land use in a subdivision will be restricted or regulated.
(2)
Common plan/common scheme: If most of the lots in a
subdivision are burdened by restrictions that were inadvertently
left out of a particular buyers deed, the restriction applied to
the individual as well.
(a)
Common scheme does not have to apply to the entire
subdivision. It could only apply to certain blocks or zones.
If the court finds too many lots in the subdivision are sold
without restrictions, the court may find that no common
scheme was in fact established.
b)
Note: California Supreme Court rejected the doctrine of implied
reciprocal negative servitudes, holding instead that restrictions must
be in writing or referred to in the deed of the land sought to be
restricted.
c)
Cases
(1)
Arthur v. Lake Tansi Village (p.429)
(a)
History: Developer distributed brochures to potential
purchasers that showed recreational facilities. The
developer also placed an advertisement forever is a long
timebut thats how long you and your family will be able
to enjoy the facilities at Lake Tansi Village. The later
owner of the recreational facilities sought to relocate the
marina closer to the residential lost and the owners were
concerned that the relocation would create noise,
pollution and impede their view of the lake. The owners
sued for implied negative servitude.
(b)
Opinion
(i)
The court recognized the possibility of enforcing an
implied negative servitude but refused to find one
in this case because the evidence was not sufficient
that the developer had impliedly promised that the
facilities would remain unchanged and the
subsequent owner was not on sufficient notice of
the intended restriction.
(2)
Evans v. Pollock (p.424)
(a)
History: The present dispute arose when devisees of the
original owner of the entire parcel contracted to sell to
Pollock a block which Pollock plan to develop into a
marina, private club, and condominium. Charles Evans
and other owners whose deeds contained the restrictive
covenants sued for equitable relief under the implied
reciprocal negative easement doctrine. The restrictive
covenant allowed for only residential uses that may be
waived by a consent of of property owners. The trial
court found that the original grantor had not intended for
the covenant to apply to the block sold to Pollock. The

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4.

5.

appeal court reversed and claimed that for the restrictive


covenant to apply, it must apply to the entire parcel.
(b)
Opinion
(i)
The fact that the restrictive covenant may be
waived by a vote is a strong indication that
there is a general scheme or plan of development
furthered by the restrictive covenant.
(ii)
General plan or scheme may require the restriction
to only apply to a certain well-defined similarly
situated lots (a block) for the doctrine of implied
reciprocal negative easements to apply as to such
lots.
(iii)
The court finds that common scheme may apply to
a well-defined block and does not need to apply to
an entire parcel. However, where a few lots are
without restrictive covenants, they may be
compelled by the common scheme / plan to follow
the covenants.
Restraints on Competition
a)
Rules
(1)
Reasonable covenants against competition may be
considered valid and run with the land when they
reasonably serve a purpose of facilitating orderly and
harmonious development for commercial use.
(2)
A restraint on competition will be enforced if it is reasonably
limited in time and space and consonant with public interest.
(3)
Restrictive covenants touch and concern the land by
increasing the value of the property.
b)
Cases: see above in Whitinsville Plaza v. Kotseas.
Restraints on Alienation
a)
General: Contractual restrictions on the transfer of real property are
often held to be void and unenforceable as a matter of public policy.
b)
Rules
(1)
Restrictive covenants on the alienability of a fee simple
estate is void unless it is outweigh by a reasonably
restrictions serving justifiable interests of the
covenanting parties. Reasonable restrictions are partial
restraints on alienation.
(2)
The courts will hold restrictions against alienation in gifts to
charitable entities valid unless the court deems there is such a
unforeseen circumstance that warrant the sale to protect the
interest of the charity.
c)
Cases
(1)
Northwest Real Estate Co. v. Serio (p.463)
(a)
History: A deed for fee simple of a lot contained a
provision that the land should not be subsequently sold or
rented prior to a designated date without the consent of
the grantor. The grantee contracted to sell to the Serios
before the said date and the grantor refused to give
consent. Serios sues declaratory judgment finding that
the covenant is void.
(b)
Opinion
(i)
The covenant is repugnant to the free-simple title.
(ii)
The covenant deprives the grantees the
unrestrained power of alienation incident to the
absolute ownership.

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(c)

(2)

Dissent
(i)
The restraint on alienation seems to be one
intended to give developer some control over the
character of the development for a reasonable
time.
(ii)
Developing a city or suburban area as a single large
enterprise using temporary restraints on alienation
may not be detrimental against public interest.
(iii)
The court should examine the whether such
development is beneficial to the public interest.
Riste v. Eastern Washington Bible Camp (p.465)
(a)
History: Eastern sold lots to Ristes parents who agreed to
obey the restrictions on occupancy and resale. Ristes
parents, with the permission of Eastern, assign the lots to
Riste. When Riste attempted to sell the property contrary
to the restrictions, Easter refused to remove the
restrictions and Riste sued for a declaration that the
restrictions were invalid. Specifically, the restriction
forbade sales to any person without approval by Easter
and the occupancy must conform to the practices of the
church.
(b)
Opinion
(i)
The rule in Washington is that a deed for a fee
simple estate prohibits the grantee from conveying
land to another without the approval of the grantor
is void as repugnant to the nature of the fee simple
estate.
(ii)
An exception is allowed for reasonable restraints
that are justified by legitimate interests. However,
the restraint on this case is against public
policy. ??? Why??? Is religion not a legitimate
interest?
(iii)
Restriction on occupancy is also void because
Washington code prohibit real estate instruments
that restrict the conveyance on race, creed, color,
national origin, or handicap.
(c)
Horse Pond Fish & Game Club, Inc. v. Cormier (p.467)
(i)
History: Horse Pond is a charitable trust and has a
property with restriction that the land shall not be
alienated from Horse Pond without 100% vote of
the Club or the Club is dissolved. As the land
surrounding the property becomes more
residential, Horse Pond called a special meeting to
vote on a land swap with another. At the meeting,
Cormier voted against the land deal and thereafter
Horse Ponds filed suit seeking declaration that the
restriction on the deed was void as an
unreasonable restraint against alienation.
(ii)
Opinion
(a)
Restraint against alienation depends upon its
reasonableness in regard to the justifiable
interests of the parties.
(b)
However, an express restrictions against
alienation in a gift made to a charitable trust
or charitable corporation may constitute a
valid restraint.

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(c)

(d)

But, the court may permit a sale of land


owned by a charitable entity if the court
determines that due to unforeseen
circumstances that the sale is necessary and
would be in the best interests of the charity.
On remand, the court should determine
whether the plaintiff is a charitable entity
and if so, whether the charity will be served
by the sale of the land.

Negative and Affirmative Restrictions


Usually, the restrictions are in the form of promises not to use the property in a particular way.
These are negative restrictions.
For instance, in order to preserve an ocean view for neighbors, one might promisenot to build on
the promisor's land a structure more than one story high.
But, there may be promises to use the property in a particular way. These areaffirmative
restrictions.
For instance, a tenant in a mall might promise in the lease 1) to maintain open shop hours for
specific times and days or 2) to pay merchant association fees.
In some circumstances, however, courts might treat a restriction that appears to be affirmative
as a negative one.
For instance, a property owner might promise to use his or her vacant lot solely for single
family residential purposes. This might appear to be an affirmative promise to use the property
as a single family, residential parcel. But, courts do not interpret this an affirmative promise
actually to use the property that way.
Rather, the courts interpret this as a negative promise not to use the property for any other
purpose. So, there is no affirmative duty to build a single family residential structure on that
vacant land.
The lot may remain vacant. But, when the owner does build an improvement and uses the
property, he or she must then use it as a single family residential parcel.
Real Covenants and Equitable Servitudes

pp. 556-576

Common Interest Developments

Implied Reciprocal Negative Easements

pp. 576-586

In some jurisdictions, another manner by which a promisor could create an implied real covenant
or equitable servitude without signing a writing, arises where the promise itself
doesnot appear in any writing. This occurs through what courts refer to as a "reciprocal
negativeeasement" where
the owner of two or more parcels of property
transfers by deed some, but not all, of the owners property
by way of a deed containing restrictions on the use of that transferred property
where those restrictions benefit the land the transferor retained, and

42

the transferred property and the retained property have such a relationship that it is equitable
for the transferee to infer that the transferor will limit the use of the retainedproperty to the
same extent that the transferee is limiting that of the transferred parcel(s).
In these circumstances, the courts having inferred the grantor promised to restrict the use of the
retained parcels, will find the grantor created an implied covenant with respect to that property.
Perhaps as further evidence that covenants are servitudes, the courts have inaccurately referred
to this type of promise as a "reciprocal negative easement," even though it really is not an
easement. But, it is a servitude.

Creating Implied Restrictions by Estoppel


A further circumstance giving rise to an implied covenant or restriction involves a situation where
a buyer or purchaser for value of property from a developer alleges he or she purchased
in reliance upon the developer's agents' oral representations and/or sales literature regarding
how the other property in the development will or will not be used.
In these cases there might be either an expressed or implied restriction. However, even if the
restriction is expressed, it does not appear in any instrument related to transferring an interest in
the property. Therefore, courts might rely on an estoppel theory to find the parties created a
restriction.
If there is a covenant here, it probably arises from an implied reciprocal negative covenant. For
such we must have 1) an owner of two or more lots [in this case O with 10]; 2) who conveys
some but not all of those lots subject to restrictions [in this case O conveying 6 of the 10]; 3)
where those restrictions benefit the land the transferor retained [in this case O's remaining lots
were benefited by the restrictions on the other lots, since the restrictions were consistent with
O's residential plan for all 10]; and 4) the transferred property and the retained property have
such a relationship that it is equitable for the transferee to infer that the transferor intends to
limit the use of the retained property to the same extent that the transferee is limiting that of the
transferred parcel(s) [in this case the properties' relationships probably arise from their unique
suitability to low density, upscale single family housing]. So, covenants on the remaining lots
likely arise as reciprocal negative covenants.

3
4

ii. Property Owners Associations

pp. 586-591

iii. Unit Owners v. Developers

pp. 591-598

Covenants Void Against Public Policy


Modification and Termination

C. The Public Regulation of Property: Zoning

pp. 598-604, 610-613


pp. 647-655
TBD

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