Chapter 5: The Modern Real Estate Transaction Real Estate Broker Relationships o Broker + Purchaser: purchaser pays broker

if purchaser buys the property the broker directed the purchaser to (ends w/ a purchase or purchaser lack on interest) o Broker + Seller: more formal; commission governed by the listing agreement:  Exclusive Right to Sell: (MOST FREQUENT) Seller pays broker no matter what  Exclusive Agency: Seller pays broker unless found own purchaser  Open: Seller pays only if broker found a purchaser  Tristams Landing case: Rule on Timing of Commission y Majority/General Rule: if there is an agreement, commission is earned; absent a contractual provision, a broker is entitled to a commission upon finding a person ready, willing, and able to purchase (legitimate buyer) on the sellers terms y Exception to the Majority/General Rule: conditional language in the agreement (on the said sale) y Minority Rule: right and payment doesnt occur until sale made (closing day)  Brokers Duties to Buyer and Seller: y The broker has a fiduciary relationship with the seller and is his agent. y A broker must exercise good faith and loyalty in representing the brokers principal. Some courts require the sellers real estate agent to disclose known defects in the premises to a potential purchaser. o Broker + Attorney: Cultum v. Heritage case (filling in blanks on a legal form is the practice of law!)  Can a real estate agent/broker perform lawyer duties? Yes  6 interests to consider when determining whether a broker can perform a legal service: y The ready availability of legal services y Using the full range of services that other professions and businesses can provide y Limiting Costs y Public Conveniences y Allowing licensed brokers and salespersons to participate in an activity in which they have special training and expertise y The interest of brokers and salespersons in drafting form earnest money agreements which are incidental and necessary to the main business of brokers and salespersons  If a broker does perform legal services, he must comply with the standard of care of a practicing attorney (if a client asks you to do something, you must try in good faith to do it within ethical standards  Also, the broker takes on the legal services assuming the risks of negligence and liability o 2 Real Estate Contract of Sale Categories o Installment Contract (contract for deed): If the purchaser cannot pay cash, the seller may allow him to make payments and only hands over the deed when the final payment is made (long term) o Financing Contracts (2 Types)  Purchase Money Mortgage: seller substitutes self for financial institution  3rd Party Financing: most common o Note: All mortgages require seller to relinquish deed at closing; not when the final payment is made (the difference b/w an installment contract and financing)  This is important difference installment K = deed after final payment; financing = deed at closing 1

o Statute of Frauds
o Any land sale transaction (deeds and real estate contracts) must be in writing, signed by the party to be charged (the party being sued/the defendant) and:  Must ID the parties  Provide a legal description of the land  Purchase price (if no indication of price, courts may insert fair market value if no indication of ongoing negotiations) o In most states, modifications of provisions included in a writing must also be in writing o What is an adequate description of land? Cash v. Maddox case  Must satisfy the reasonable certainty test = Must be clear enough to understand without parol evidence  When a portion of an entire property lies outside of a town and part of the property is being sold, then a description of the property as lying within the town will not suffice  Another rule: a writing may take any form so long as all necessary information is present (EX) a check o Exception PART PERFORMANCE: Require acts + a theory  Acts: usually 2/3 required y Payment of consideration (full, maybe partial) y Possession of the property y Making improvements on the property (must be substantial)  Part Performance: equitable doctrine that can salvage a contract even if no writing is present to satisfy the statute of frauds; theories: y Unequivocal Reference Theory: if acts of part performance can only be explained by the existence of an oral contract, then the contract should be specifically enforced; if there is another reasonable explanation, then no part performance, and the contract cannot be enforced o May be enforced by Plaintiff or Defendant o Majority Theory y Equitable Estoppel or Equitable Fraud: detrimental reliance o Minority Theory o May only be used by the buyer to enforce the contract against the seller o Sample Contract p. 432-434 o Timing Issue o Is it essential for performance to be tendered on date specified or can it be late? o There is a split b/w law and equity; principles of equity trump law o Position at law: date is essential, and the consequence for non-compliance is breach o Position at equity: reasonable period of time after date specified to tender performance o Exception in equity: express indication to the contrary, or if obvious by conduct that time was of the essence o Parties may WAIVE time of the essence by an oral or written contract or through conduct (EX) when a party tenders performance late, and the other party still accepts it o Courts will make time of the essence if one party has unilaterally communicated it (reasonably) o Earnest Money: money paid by the buyer in advance of closing to show genuine seriousness of buying the property  Placed in escrow/trust  Trust agent must act in good faith  What if the buyer defaults?  Earnest money is usually distributed to injured party (seller + agent) as liquidated damages 2

o Marketable Title/Merchantable Title

o Most common test: would an ordinary person in the usual course of business accept the title to the property (considering all defects)?  Must the title be free of ALL defects? NO; just satisfactory to buyer  Examples of defects that could make the title unsatisfactory (cloud the title)? Lease, mortgage, lien, easements, adverse possession suit y A good rule of thumb is that a title is UNmarketable if acquiring the property would subject the purchaser to a real risk of litigation. The purchaser is not required to buy a lawsuit.  G/M case: A lease that is not binding on the purchaser would not render a title unmarketable  Abstract of Title: history of title; the seller has an obligation to bring it before closing  Warner case: y The seller doesnt have to show a MARKETABLE TITLE until closing y SO, you can sell the property without being the owner, but by closing day, you better damn well get it, otherwise youre in breach. And youre a bitch. o Insurable Title Test: is this the kind of title an insurance company would insure o Remedies  Forfeiture of Deposit: in the event of default by the purchaser, the seller is entitled to retain the deposit as liquidated damages. Can the seller retain the purchasers deposit if the land was promptly sold to another individual at a higher price? There is a split in JXs.  Specific Performance: generally available to each party even absent such a provision  Pruitt case: All real property is inherently unique (so, specific performance is available) y Condos are specific despite identical design  Doctrine of mutuality of remedies: any remedy available to a buyer is also available to seller (the traditional rule)  Mutuality of performance: seller is after money for the sale, and money is not unique, so the seller is not entitled to specific performance per se (the modern rule) y EXCEPTION: property swap, not paid in money but by a unique compensation  Buyers Damages: buyers damages should equal benefit of the bargain + out of pocket expenses y Earnest money, costs y What if contracted for the sale less than fair market value? y Split JDX: o Pay difference (benefit of lost bargain) o Out of pocket only (EXCEPTION: if have knowledge of defective title to get the benefit of the bargainbad faith rule)  Sellers Damages y Normally just money damages y Can get benefit of bargainhow to measure? o Seller has a duty to mitigate damages (sell to someone else) o May sell for $100K, when buyer would have paid $130K; damages = $30K + expenses o Equitable Conversion and Risk of Loss  Majority: Doctrine of Equitable Conversion: signing of the contract itself is the equivalent to closing; buyer is the owner of the property and the seller is the owner of the money (and purchase money is the Sellers even if with still with the B).  So the risk of loss is on the buyer at the signing of the contract 3

 Minority: y Risk of Loss on the buyer only after day of closing y Uniform Vendor and Purchaser Risk of Loss Act: Risk of Loss is on buyer if title or
possession of deed has been passed to buyer (OK follows this rule)  Bryant case: Rules that RoL can be changed by contractual language- As is language can shift the RoL burden to the buyer y Fire after K, but K had specific language about risk shifting back (Equ. Con. Dont apply)  Hypo: if damaged property is transferred to a 3rd party? y What is the buyers remedy? o Seller does not have the property, and specific performance is not avail. o Damages seem inappropriate b/c seller is not at fault o So, the buyer gets return of the earnest money/deposit, other costs (inspection), and rescission of contract y What if the seller did still have the property?- substantially damaged vs. not substantially damaged o If property is not substantially damaged, then specific performance with abatement for buyer = reduced purchase price that reflects the diminished value as a result of the damage (when defects on the title are incurable, like a physical defect or an easement and owner is not willing to relinquish) o Specific performance with cure: defects on title are sometimes curable o If the property was substantially damaged, specific performance is not available, but a buyer can get rescission of contract, earnest money, and other out of pocket expenses. o Financing the Transaction: o Mortgage: is a pledge of land to secure repayment of a loan. The purchaser borrows money from an institutional lender, executes a promissory note payable to the lender, uses the loan money to purchase improved real estate, and pledges the property purchased as collateral. The borrower is known as the mortgagor and the lender as the mortgagee. If the mortgagor does not repay the loan, the mortgagee may utilize the foreclosure process and have the mortgaged property sold to satisfy the unpaid balance.  Foreclosure the process in Mortgages o What happens if there is a default?  In a deed of trust, where the 3rd party mortgagee (financer) holds the deed until the last payment is made, the 3rd party may exercise the right of power of salestrict foreclosure  In a traditional mortgage, where the 3rd party mortgagee hands over the deed at closing, foreclosure is done by a judicial sale (overseen by the court). o Foreclosure: a way for the mortgagee (the bank/lender) to get the money it was promised by the buyer (mortgagor)  Acceleration clause- if buyer defaults, then whole mortgage is due immediately  Strict foreclosure- how long of a period after a default for foreclosure o Title Theory o Lien Theory o The bank holds both the promissory note and collateral (the property in the form of the mortgage) o Equitable Redemption: opportunity for buyer to redeem self and make the payment(s) he missed  Must redeem self within a reasonable time  Could be frustrated by an acceleration clause or provision in the mortgage contract (if miss one payment, must pay the entire balance of the loan)  Forfeiture > Equitable Redemption > Strict Foreclosure (where the date of redemption is identified) o Today: Foreclosure by Sale reduces amount of money owed/mitigates damages 4

 When a sale occurs, it only creates part of the original contract sale rice. Then there is a deficiency,
which buyer continues to be responsible for y Incentive for financial institution to just sell is no more b/c the courts have addressed the issue y Anti-Deficiency Statutes: to make sure property sold at foreclosure for fair market value (b/c the institution will not be able to go back to the original owner to make up lost $) y Statutory Redemption: gives the original buyer a 2nd chance to redeem self even after a foreclosure sale by paying purchaser the price he paid at foreclosure; time limited by statute y Ok approach: statute requires the foreclosure to not take place sooner than 6 months and only 2/3 of price o Subject to Financing Clause: o Bruyere case: intent of financing clause is to protect the buyer from involuntary breach; but where a buyer is unable to get or keep a promise of financing, it fails b/c of a voluntary action of the buyer, the risk of failure is properly imposed upon the party who so acts and not upon the innocent seller (buyer must make a good faith effort to obtain financing; where it is involuntary (like the death of co-signor/wife) there is not a breach of contract by the buyer o Homler case: if language is absent: (jdgmt for pltff because language was not explicit)  Minority: contract is unenforceable  Majority: courts can insert the language; the contract is valid and enforceable o Prepayment on Mortgages: if loan language/statutes allow prepayment, then it is permissible, but may be coupled with a penalty o Taking over an Existing Mortgage: o Issues of Assignments, Assumptions, and Taking Subjects to a loan  Due on sale clause in contract = financial institution will not allow low interest rate loan to transfer to the next owner  Assumption: if buyer 2 assumes mortgage & promissory note, only buyer 2 remains responsible b/c has the promissory note (note creates the risk)  If buyer 2 cannot pay the deficiency, Buyer 1 is secondarily responsible (release)  Taking subject to: if buyer 2 takes subject to, buyer 1 is still responsible (for the deficiency after sale) b/c still has the promissory note (buyer 2 only took mortgage) o Lewis case: under an installment contract can seller exercise forfeiture? (Meaning he gets property back and all the money paid in) o Modern approach: redemption applies to installment contracts just as it does to mortgages (equitable mortgage) o When is an installment contract converted into a mortgage?  When there is only a small amount owed  If a person has paid a majority of required payments  Not all installments are automatically converted to mortgagesdepends on stake the buyer has in it

o Recordation: applies to vertical, not horizontal, transactions

o Traditional common law rule: first in time, first in right (prior in time, prior in right) o But, the modern recording system gives B (the later buyer) a chance if records transaction; assuming certain conditions are met, provides an opportunity for the subsequent buyer to win o Recording preserves the purchasers interest by imparting constructive notice of the transaction to subsequent purchasers. The index is key to title examination; a proper search of the index will disclose any defects affecting the title. o Using some system, the title examiner must establish a chain of title for the present owner. A chain of title is the successive conveyances of title to a particular parcel of land beginning with the first or patent deed 5

from the government and ending with the deed to the person presently claiming title. The period of search has been reduced by marketable title statutes to 30-40 years of the root of title. Thus, title must no longer be traced back to the original owner. o Recordation does not protect a landowner against adverse possessors who may acquire title to the property by occupying it in a certain manner for a particular period of time. The time period is established by the statute of limitations. o 3 major categories of recording systems  (1) Torrens Registration System (minority): official state issued deed (like car registration); usually voluntary, like in Hawaii y Issued by the state and indicates any leins  (2) Tract System (OK): registered, recorded by each recipient at closing; 1 property = 1 entry  (3) Grantor-Grantee System: y 2 sets of documents y Alphabetical and chronological y Use an index o Recording Systems have 3 categories of Statutes: recording an instrument puts the world on constructive notice of its existence and contents. Generally, a conveyance is valid between the immediate parties whether recorded or not. However, failure to record may pose serious problems if the grantor conveys the same real estate to a subsequent purchaser.  (1) Race: 2 Jxs; where the first purchaser to record prevailed (notice was irrelevant)  (2) Notice: 24 Jxs; only a subsequent purchaser who takes without notice of prior unrecorded instruments is protected. A subsequent purchaser need not record or prevail over a prior claimant but recordation would be wise to insure protection against further subsequent purchasers.  (3) Race-Notice: 24 Jxs; in order to prevail under this statute, a subsequent purchaser must be without notice of a prior instrument and record first.  If a taker is not able to satisfy the recording statute requirements, the basic rule of prior in time, prior in right is restored  Therefore, 48/50 Jxs require notice to prevail  Types of Notice: y Actual y Constructive: recordation y Inquiry: surrounding circumstances (other than recordation) demonstrate notice or create a reasonable need to inquire o Lis Pendens: indicates a pending lawsuit on the property, and therefore cloud on the title; obligates an inquiry o Other physical conditions on the property may obligate inquiry, such as a fence, etc.  Who is protected? y Generally, the only persons protected by the recording system are bona fide purchasers. In order to qualify as a bona fide purchaser, a person must give valuable consideration and take without notice. (under pure race statutes, notice is not a factor.)  Split Jxs on Who is a purchaser? y 39/50 Jxs have statutes requiring the subsequent buyer must be a purchaser; that is, must pay valuable consideration y But, split on if substantial consideration is required or if just non-fraudulent nominal consideration is enough  No Jx requires payment of fair market value 6

 In order for the subsequent taker to win, must y Be w/o notice y Record first and be a purchaser y Donee: a subsequent taker as a donee can NEVER prevail over a previous purchaser y What if the previous taker was a donee, not a purchaser?
o Only the subsequent taker must be a purchaser, according to statute o But, the previous taker as a donee must record  Can a judgment creditor satisfy the recording statute requirement of a subsequent purchaser? y Yes, if creditor is listed in the statute as eligible for protection (limited to a judgment creditor, not just any creditor) y Must have new consideration???  Anderson v. Anderson some jurisdictions say substantial consideration required, not just nominal. Recordation not necessary for deed to be effective.  Rowe v. Schultz- creditors can hold leins on property  Haner case: y Old view: recordation was enough (case holding) y Modern view: must be properly indexed so that notice can be given (case dissent)  Sabo case: y Marketable Record Title Act: places a time limit (about 30-40 years) on the bounds of a required search to give notice (instead of all the way back to the patent deed from the government); anything prior to the allotted time is irrelevant; but may re-record to protect interest y Root of Title: the next title instrument greater than the required time y O > A wont show up in index b/c before govt granted to O (A records, but it is outside the chain of title) Govt > O O>B B wins b/c cant have notice of A in the chain of title o Recordation hypos: Who Wins?  (1) O > A (no record) A > B (record) O > C (record) O > A (record) y C wins b/c w/o notice on the critical date of closing y How C would search the index: o Grantee index backward for Os name (found govt patent to O) o Grantor index forward for Os name (to see if O already conveyed the property to someone else) o Therefore, C is w/o notice b/c A never recorded  (2) O > A (no record) A > B (record) + O > A (record) O>C y B wins b/c C has notice before date of closing  (3) O > A (no record) A > B (record) + O > A (record) A>C 7

y (4)

B wins b/c C has notice of B

(5)

(5)

(6)

(7)

(8)

O > A (no record) A > B (record) A>C B wins b/c C has notice of B Shelter Rule/Principle O > A (no record) O > B (no notice) B records B > C (notice of A) Q: Does Os knowledge of Cs knowledge of C prevent C from satisfying the notice statute? A: Normally, yes. But, C, in this case, is sheltered/protected by Bs lack of notice. Why: To make sure that real property could be kept in the system Types of Notice: (1) Actual Notice (2) Constructive Notice (recordation) (3) Inquiry Notice (no recordation, but surrounding circumstances may create notice or a reasonable need to inquire) Standing in your own Shoes O >A (no record) O > B (notice of A) B records B > C (no notice) C wins b/c not affected by Bs taint (has no notice of Bs actions) No Cleansing O > A (no record) O > B (notice of A) B records B > C (no notice) C>B Court will not allow shelter principle here; A wins C stands in Bs own Shoes O > A (no record) O > B (no record, but B has actual notice of A) A records B records B>C A wins b/c has no obligation to search through C Q: What if C is confronted with the argument of a tainted deed from B may not have had notice A: C stands in Bs own shoes C will look in grantee index for B, then in grantor indexfinds no transfer from B to anyone else, so goes back in time and to find the patent deed from the govt to B (O > B), but also finds the patent deed from O > A, so C would have constructive notice of A. O > A (no record) O > B (no record) B records A records B>C 8

y y

Cs Search: search patent O > B recordation under Os name in grantors index to B (so, would never find A, b/c A recorded after B) A wins (by a slight majority), although C should win, given the bounds of the search Witter case: searching restrictions on property (real covenants and equitable servitudes) o Limited to searching own chain of title only o If not in the chain of title, usually not subject to it, unless there is a reason for inquiry notice, such as if see something out of the norm on the property o Inquiry notice- give rise to asking questions by a reasonable person Bank of Mississippi case: o Inquiry notice means does it arrest your attention?/ Would a RP ask questions? o O > A (no record, but puts up a fence) o O > B (searches title, and it looks clear) o But, B is aware of the physical condition of the propertythe fenceand it gives B at least inquiry notice, if not constructive notice Curative Acts: if a technically insufficient document has been recorded for several years, it is recorded Reverter Acts: lose property if not meeting a condition, but after 50 years, the condition is eliminated unless it is re-recorded

A-CONE-HAT
Adverse Possession: process through which a person who uses property as would a true owner for a statutorily determined period of time becomes the owner of the property and defeats all rights of the person with legal or record title. o Recordation does not protect a landowner from adverse possessors who may acquire title to the property by occupying it in a certain manner for a particular period of time (est. by the SOL) o Adverse possession is not extinguished by marketable record title statutes o Adverse Possession only runs against a present interest, not a future interest o There are 2 kinds of adverse possession statutes o Short: 5 years (requires color of title and describes property) o Long: 15 years o Common elements: Actual, Open and Notorious, Exclusive, Hostile or Adverse, and Continuous  Exclusive: the adverse possessor holds the property to the exclusion of the true owner y (1) What if there is use of property by adverse possessor and record title holder: the adverse possessor must make the record title holder the subservient possessor; the adverse possessor must use the land in an inconsistent manner of the record title holders simultaneous use y (2) When there are 2 adverse possessors on the property: o If they are in different areas of the property, divide it up o If same area, neither may satisfy the element, one must assert itself as the dominant possessor  Continuous  Carpenter v. Huffmany Tacking is allowed, but must show condition of privity (Grantor-grantee; ancestor-heir; devisor-devisee) y More than fragmentary and occasional; but seasonal use can be sufficient y Q: What if the deed passed only describes the original, legal property, not the adversely possessed piece of the property? y A: Majority Rule: the adversely possessed land always attaches to the legal property even if it is not described in the deed y A: Minority Rule: adversely possessed land does not pass if not described in the deed, unless it is enclosed by a fence 9

o o o

Tolling: stops the running of the SOL for a period of time if: o Insanity o Imprisonment o Minority of age o Illness or other infirmities o Must be the person who is losing the property (disseissee) to the adverse possessor (disseissor); (seisin indicates ownership; when you pass a deed, you pass the seisin of the property) o When the infirmity is removed,  The statute begins running againmust runs its entirety, OR  Statute may only have to run for 2-3 years more  Possession: be on property and use as an ordinary owner would, not secretly  That is open and notorious y Cannot be secretly on the land y Must use the land as an ordinary landowner would y Must be conspicuous and arrest attention  Hostility: being on someone elses property and using it as ones own w/o permission and inconsistent with the true owners rights  Saunders case y Requires that you be on someone elses property y Mistake and any other motive is irrelevant/unnecessary y Only the act of possession matters, not words of possession o Differences b/w Long and Short Statutes  Color of Title: document says he has ownership, but the document is not legally significant  Claim of Right: simple assertion that land is mine (there is no document) o Constructive Adverse Possession: physically occupying the pedis possessio, but w/ document describing the entire property, constructively possessing/occupying the rest/whole Jarvis case: o Q: Can you adversely possess against a govt authority? o A: you can adversely posses against a local govt authority but not state or federal  Split Jxs on local govt owned property  You can adversely posses if not intended for public use  Problem: presumption that local govt land is for public useso its hard for adverse possessors to satisfy the element of being on land w/o permission (hostility requirement); must show govt had abandoned its intention to use property for public use Marengo Cave case: adverse possession underground is not open and notorious Why do we have the doctrine of adverse possession: market based idea that it is better to keep land productively utilized rather than unused and unkempt Privity and Tacking: An adverse possessor may sell or gift his interest in the property to another person. The purchaser or donee succeeds to the adverse possessors attributes, including the time the first possessor occupied the property. This adding of the time the first possessor used the property to the time the second possessor used the property is called TACKING. The relationship necessary to allow tacking is called PRIVITY. Privity occurs by contract of sale, gift, or inheritance. Disabilities and Tolling the Running of the Statute of Limitations: The SOL for an adverse possession claim will not run against a true owner who is under a disability when the adverse possession commences. Infants (minors) and the mentally generally are deemed disabled. Other common groups include persons in prisons, those in military service, or those whoa re absent from the state. If a true owner is under a disability, the SOL will not run against him or her until the disability is removed. The statute is tolled. (1) The disability must exist at the beginning of the adverse possession. (2) There is no tacking of disabilities. (3) A person taking from or through the true owner y 10

under a disability can generally take advantage of the tolling statute to the same extent as the person with the disability, except that the disability is deemed to end on the day of the sale or gift. o Statute of Frauds for Deeds: Requirements o ID parties: grantor and grantee o ID property (legal description) o Metes and bounds: starts at a definite point and traces the perimeter by reference to appropriate courses (directions) and distances back to the starting point. If the description does not close the attempted conveyance generally fails for lack of an identifiable parcel. o Government survey: grid system: rectangular tracts by running parallel lines north and south and then east and west with principal or prime meridians and base lines and additional lines creating townships. It is common to use a combo of metes and bounds with government survey o Plat: most common for residential subdivisions; blocks and lots: the blocks andlots are described by metes and bounds and numbered o 3 Classic Problems w/ Descriptions of Land o (1) Cash v. Maddox: factional part of a larger property not clearly IDd o (2) A description that would depend on some outside knowledge (no parol evidence allowed) o (3) Changing boundaries: o Accretion: deposition of new soil along a river; a slow change; allows a legal shift o Reliction: water line receding; slow change; allows a legal shift o Avulsion: quick change; does not shift the legal boundary o Grantor (seller) must sign the deed o No price requirement, b/c could be a gift o Words of conveyance indicating the transfer of the property o Some Jxs require: o Witnesses o Notarized o Signed at bottom by grantor (subscribed) o Deeds/Covenants of Title: o Quitclaim deed: includes no title covenants/promises; grantor simply conveys whatever interest the grantor has in the property, but it is just as effective for the transfer of land as the other deeds o General Warranty deed: spells out the basic covenants (3 present and 3 future); promises by grantor and prior owners that the title is free from defects not listed on the deed o 3 Present: o (1) Covenant of Seisin: grantor has the interest in the property; promises he owns it o (2) Covenant of Right to Convey: grantor promises that grantor has the authority to convey the property; grantor has the legal ability to transfer the land o (3) Covenant against Encumbrances: grantor promises that the land is not burdened by any mortgages, liens, easements, leases, restrictive covenants o Wilcox case: o An encumbrance: any burden or charge on the land and includes any right existing in another whereby the use of the land by owner is restricted o General view: public restriction, such as an ordinance, is not an encumbrance o But, a present violation of an ordinance on the property is an encumbrance o Q: What if there is a private restriction, such as a subdivision restriction? o A: Mere existence of a private restriction does breach a covenant against encumbrances o **If present covenant is breached, it is breached at the very moment of conveyance, which is important b/c then the SOL begins to run o 3 Future: 11

o (1) Covenant of Quiet Enjoyment: grantor promises that the grantee will not be evicted by a paramount holder; no one will come claim a superior interest in the land o Foley case: how to calculate damages for a breach of quiet enjoyment? o Purchase price + interest + atty fees + court costs in defending title o Q: What if there was only an easement across the land, not a total breach? o A: Buyer gets only diminished value of property o Same measure of damages for present and future covenants o Q: What if buyer had made improvements to the land? o A: At common law, buyer cannot recover compensation for improvements o A: But, most Jxs have adopted betterment statutes or occupying claimant statutes so that the buyer can recover for improvements from the buyer with the superior interest of title o A: Buyer is entitled to the lesser of what the improvements cost OR the change in value of the property o Proffitt case: Running of Covenants of Title o Present covenant do not run with the land (Os covenants do not run thru A and on to B) o Future covenants can always run; the measure of damages of a breach is what the initial buyer paid to get the general warranty deed o (2) Covenant of Warranty: the grantor will come to the grantees defense & protect against someone claiming a superior interest to the land; and if grantor loses, grantor will compensate the grantee o (3) Covenant of Further Assurance: grantor promises to do any act or execute any document necessary t make the title good o ** If future covenant is breached, it is breached at some point in the future o Special Warranty deed: same 6 covenants, except that the grantor promises only the grantor did not create a title defect; does not account for previous owners o Statutory Short Form deed: includes all 6 general warranty deed covenants but uses words representing larger concepts o Delivery of Deed: for a deed to be effective at law it must be delivered (during the life of the grantor) o Deeds are often delivered in escrow. That is, they are given to a third party to be delivered to the grantee upon the satisfaction of a certain condition, such as payment of the purchase price, or upon the occurrence of a particular event, such as the death of the grantor. o Relation back doctrine: where, after the death of the grantor, the grantee performs the conditions of the escrow agreement, grantee is entitled to delivery of the deed, and grantors title relates back to the date of the original deposit of the instrument in escrow. o 3 principles: o (1) Whether the grantor has a present intent to irretrievably transfer the interest of the deed; grantor must have a present interest to divest self from deed o (2) Delivery at law has a different meaning than its everyday sense o (3) Rebuttable Presumption that if a deed is not physically delivered it has not been legally delivered o Delivery Settings: o (1) Delivery in connection w/ death o (2) Delivery in connection w/ a sale of property o (a) Grantee w/cash at closing immediately gets deed and theres no problem o (b) Grantee finances purchase where grantor holds the deed o (c) Grantee has grantor place deed w/ a 3rd party in escrow o Q: What is the effect of delivery out of escrow w/o complete performance/ escrow conditions? o A: Minority: still effective delivery o A: Majority: no effective delivery; the deed is invalid, unless: 12

o o o o

(1) Ratification: grantor is aware and approves of the grantees taking of the deed, so deed is effectively delivered o (2) Estoppel in pais: grantor does not signify that he approves, but he does not do anything either, so the deed is effectively delivered o Modern trend: even if deed goes, seisin does not always o Traditional approach: deed goes, then seisin; general view: if want to transfer upon death, should comply with statutes o Chandler case: there was no delivery during the grantors life; o View as a will, but then subject to rules under the statute of wills? o Just look to grantors present, basic intention to irretrievably part with the deed Doctrine of Merger: Covenants contained in a contract are merged into deedand deed takes precedence so only covenants in the deed are applied American National Storage v. Lopez Non-Title Covenants?? Seller Liability for Condition of Premises: Implied Warranty of Habitability/Quality o To establish a breach of this warranty, a plaintiff will have to show: o He purchased a new home from the defendant-builder-vendor o The house contained a latent defect o The defect manifested itself only after purchase o The defect was caused by the builders improper design, material, or workmanship o The defect created a substantial question of safety or made the house unfit for human habitation o Must comply with the SOL and statute of repose o The important factors are: o Residential dwelling recently sold by the builder-vendor o Warranty covers dwelling and any fixtures in the dwelling o Latent defect, not obvious, and is not readily apparent during a reasonable prepurchase inspection o Can a subsequent purchaser of a house be able to pursue implied warranty of quality claims against the vendor-builder? Privity is not required to maintain an action for breach of the implied warranty of habitability. So, a remote purchaser can make such a claim without privity if within the specified time period. o Vector case: other bases to sue on if cant under habitability o If the previous owner caused the defect o Express warranty o Misrepresentation o Non-Disclosure o Lyons case: Fraud/Misrepresentation Elements: o Known or recklessly ignorant o Falsity o Of a material fact o Reasonably relied upon by a buyer o Concealment is another form of misrepresentation (action instead of words) o Johnson case: Concealment: act of misrepresentation to make facts appear as other than they really are o Remedy of rescission is not possible if transaction already closed and deed passed/delivered o Rescission is possible before closing but buyer must give seller opportunity to first repair the defect o Nondisclosure/Nonfeasance o Old common law rule: caveat emptor: no duty to disclose 13 o

o Modern rule: statutory requirements of disclosure o New Common law rule requires disclosure where: o Seller knows of material facts o Affecting value of property o Only known by seller o Buyer does not/cannot know o Seller is obligated to disclose o If it is an as is contract, there is no duty to disclose, but there is a duty against misrepresentation Chapter 6: Attributes of Land Ownership: o Right to Exclude: Ownership of property implies the right of possession and control includes the right to exclude others; that is, a true owner of land exercises full dominion and control over the land and possesses the right to expel trespassers. o 2 Types of Interests in Real Property o Non-Freehold: lease/rent o Freehold: ownership o Fee Simple o Absolute: no restrictions/limitations o Defeasible: (determinable) can lose if dont satisfy condition(s) o At common law, if any of 3 kinds of restraints placed on a fee-simple, it was invalid o Modern approach: approach of reasonableness: reasonable restraints are allowed on feesimple estates o Life Estate: typically lasts for the life of the grantee, sometimes a 3rd party, but may also be subject to defeasibility o At common law, restraints on life estates are not automatically invalid o Disabling: invalid o Other 2 restraints: valid o In some Jxs, a restraint is reasonable as long as it does not exceed the rule of perpetuities o 3 most important reasonableness factors: o (1) Duration o (2) Scope o (3) Purpose o Racial Restraints: Open Housing: o Shelley case: disabling restraintrestricts sale to a certain race, ct. says illegal o 14th amendment: equal protection of the law, even of property o Requires state action: grantor must go to court to enforce it, even if its private property o Barrows v. Jackson: promissory restraint: if transfer to racial minority, pay grantor damages for breaking promise (court ordered); violates equal protection of the 14th amendment and chills interest/discourages transfer to minority- cant punish someone for selling to minority o Evans v. Abney: forfeiture restraint (reverter): no state action b/c reverts automatically back to grantor, so doesnt have to go to court o But, 2 possible arguments: o (1) Mere recognition of the restraint is a state action o (2) Possibility of unreasonableness o County of Dane v. Norman: ct said sellers have right to refuse property based on business decisions. o Right to Lateral and Subjacent Support: o The right to lateral and subjacent support is a common law incident of land ownership. Adjoining parcels of land provide lateral support. Subjacent support is provided by soil beneath the surface and may become an issue when a property owner conveys away mineral rights. 14

o Lateral supports must be added natural inclines Properties INc. v. Racetrac Petroleum o Game and Fish v. Lake Islands- riparian owners rights. Motor boatists rights dont trump all other rights o Coffin v. Lefthand ditch time and amount, first one to use has rights o Pyle v. Gilbert as long as dont disturb flow, allowed o Common law rule: land in its natural state is entitled to lateral support from the adjoining land. Neighbors are under a duty to protect adjoining property. This rule is not applicable to land that has been improved/altered to require additional lateral support. Landowners who raise their land above the natural level are under a duty to keep the dirt from encroaching upon a neighbors land (i.e. a retaining wall). o Every owner of land has the right to naturally necessary lateral support from the adjoining soil, and if a landowner removes the soil from his own land so near the land of his neighbor that has neighbors soil will crumble away under its own weight, he is liable for damages naturally resulting therefrom, including damage to structures on the subsiding land, without the necessity of showing negligence (strict liability). The person damaged must show that the excavator failed to use reasonable care in making and/or maintaining the excavation. o Negligent Withdrawal of Lateral Support: an excavator must use reasonable care/foreseeablity in making the excavation. Factors in determining negligence: o Necessity of the excavation o Adequate notice given to neighbor o Reasonable precautions taken o Employment of competent workers o Use of proper instrumentalities o Heins case: Diffused Surface Water will be on exam!!! o 3 approaches to Surface Water: o Civil Law or Natural Flow Rule: imposes liability for any interference with the natural surface drainage pattern that causes injury to anothers land (or else liable for damages/trespass)lower subservient estate is obliged to accept the water that would naturally drain into it, and the higher/dominant estate is precluded from retaining the water that would naturally drain off it. o Common Enemy Doctrine: the right of a party to the free and unfettered control of his own land above, upon and beneath the surface cannot be interfered with or restrained by any considerations of injury to others which may be occasioned by the flow of mere surface water in consequence of the lawful appropriation of land by its owner to a particular use or mdoe of enjoyment. Youc an take whatever action you need to get it off your property. o Rule of Reasonable Use (majority): look to the surrounding circumstances; property/tort nuisance; each possessor is legally privileged to make a reasonable use of his land (even where it is harmful); liability arises when the defendants conduct is either intentional and unreasonable or negligent, reckless, or in the course of an abnormally dangerous activity. o Modern Civil law Rule: addition of a reasonable use provision o Oklahoma Rule = common enemy doctrine with a reasonable use provision o Chapter 4: Real Covenants and Equitable Servitudes: Non-Possessory Rights and Interests in the Property of Another o Covenants are promises o If not in chain of title, not on notice, but law of equities say different o Real Covenant v. Equitable Servitude o The remedies are different (for ES, seeking an injunction b/c under equity; RC = money damages) o Equitable servitudes are easier to prove b/c there are less elements o Both are covenants/restrictions o Real Covenants (deed covenants): the backbone of private control use of land; prohibit certain uses of property or require particular action by a property owner. Such covenants are important today as the means 15

by which the development of a subdivision or the operation of a condominium is regulated. Covenants are typically recorded with the plat of a subdivision and then incorporated by reference into each conveyance made by the developer. Similarly, numerous covenants binding condominium unit owners are contained in condominium documentation. o Creation of Covenants by Express Agreement or by Implication: o Most jxs view real covenants as an interest in land, and it must be in writing as required by the Statute of Frauds (RC) o But some courts allow equitable principles of estoppel and part performance to grant equitable relief in the cases of oral agreements (ES) o In some states a covenant may be implied in equity under certain circumstances (ES) o Enforcement at Law against Subsequent Purchasers: whether a successor to the covenantee may enforce the covenant and whether a successor to the covenantor is bound by the covenant. Does the covenant run? In order for a covenant to run with the land, the covenant must be enforceable, the original parties must intend the covenant to run with the land, the covenant must touch and concern the land, privity of estate must exist between the original parties, as well as between such parties and their successors, and the purchaser of the burdened property must have notice of the covenant. o Elements of a Prima Facie case for Real Covenants: o (1) The covenant must be enforceable (in writing) o 4 possible challenges to the enforceability of a restriction (ES OR RC) o (1) Ambiguity: a covenant that is incomprehensibly vague or unreasonable, as a matter of public policy will not be enforced even between the covenantor and the covenantee. o (2) Statute of Frauds: is it in writing? Does it ID the parties and the land? Is it signed? o (3) Constitutional inconsistency or inconsistencies involving ordinances or statutes o (4) Inconsistent with public policy o (2) The parties intend the covenant to run w/ the land o Old common law: use words like heir o Modern: can be gathered from surrounding circumstances (not only words) o (3) The covenant touches and concerns the land o Does the restriction relate to the land? If T&C = appurtenant o Test 1: Whether the restriction focuses on, relates to, or deals with the land o Test 2: primarily aimed at the land (does T&C) v. incidentally affecting (personal) o 3 situations: o (1) A must keep property purple o (2) A must mow lawn o (3) A must keep beard trimmed (personal covenant) o Even if all elements are met, it may be stopped from running if the benefit that arises out of the burden is personal; split Jxs (1/2 say enforce as ES; 1/2 say dont enforce it at all/benefit wont run) o (4) Privity of estate (horizontal and vertical) exists b/w the original parties and their successors; and o Cant sue an adverse possessor under RC, only ES o Horizontal Privity: original party and successor o Common law: landlord-tenant (had to have a continuing relationship) o Modern: instantaneous Privity; privity is established at the time of conveyance o A minority of states the necessity of horizontal privity has been eliminated o Vertical Privity: grantor-grantee; devisor-devisee; ancestor-heir o (5) The purchaser of the burdened property have notice of the covenant o Actual, constructive, inquiry (ES only) o At equity: in minority Jxs, can have an implied ES by inquiry notice; majority allows inquiry notice if there is a writing and no recordation; but never enforces Implied ESs 16

o Equitable Servitudes have the same elements (minus Privity): other difference: Enforceability: can be express or implied; can be oral and shown by part performance o 3 Categories of Issues for ESs and RCs o (1) Is the restriction enforceable? o (2) Did the restriction run? Did the burden transfer? Who can be a proper Defendant? o (3) Does the benefit run? Who is the proper party to enforce the restriction? o Sanborn case: SOF issue b/c there is no writing o Majority view: must be in writing (RC) or evidenced by part performance (ES) to make it enforceable (Express Restriction) o Minority view: no writing and not orally communicated; these restrictions are not interests in land, they are simply limitations on usewhich are not required to be in writing to be enforceable =>Implied Equitable Servitude (only recognized in minority jxs) o Ambiguity Test: Whether or not it is clear and free from doubt; to be free and clear from doubt, it must tell you something about the type, cost, and there must be something about the duration of the limitation o McHuron case: ambiguous language; Even if you have language that is on its face too vague, it may be rendered enforceable if you have some additional language that provides background b/c it adds a basis for understanding the language o HINTS: IF ONLY O > A, ONLY FOCUS ON ENFORCEABILITY; ELEMENTS 2-5 DEAL WITH RUNNING OF THE BURDEN/BENEFIT o Running of the Benefit: Who is the proper Plaintiff to bring the lawsuit? o Step 1: Is it an ES or an RC? o If it is an RC, show the other elements on the benefit side as well as the burden (dominant gets the benefit; subservient is subject to the burden) o Step 2: Intent to Run and Notice < most important o **Even though all elements must be proved out theoretically, usually the only element in dispute invariably on benefit side is Touch and Concern o How to show Touch and Concern on the benefit side? o 2 principle ways: o (1) Lands retained by grantor (O) where owned more than 1 lot o (2) Neighborhood scheme o 2 Subsidiary ways: o (1) Promissory reliance o (2) 3rd party beneficiary o Neponsit case: affirmative obligation to pay HOA fees: Flexible Approach to Enforcing Covenants at Law: relaxation of touch and concern and privity elements: o Touch and Concern element: o Not a restriction on the land itself b/c its money o General rule: an affirmative act to pay money does not T&C the land o New test: Legal Right Test: p. 388, 389: a covenant which runs with the land must affect the legal relations of the parties to the covenant, as owners of a particular parcels of land and not merely as members of the community in general, such as taxpayers or owners of other land. o Who is trying to sue? o The Homeowners Association, not the actual homeowners o Relaxation of requirements: the association is the alter-ego of all the property owners and is standing in their shoes (allowed) o Enforcement in Equity Against Subsequent Purchasers: Tulk: just ES does not require privity! o Who may enforce? Christiansen, Nelle o Touch and Concern element: is the nature of the burden such that it gives rise to a benefit that settles on the land, not the person o Christiansen case: 17

o If a benefit is personal, it may prevent the burden from running o Covenants may be enforced in equity by plaintiffs even though he no longer remains an owner of that particular property if he retains an interest nearby. o Snow v. Van Damm case: o 3rd party beneficiary: a 3rd party was also to benefit from the running of a later imposed restriction on another lot o Minority: conveyor/restrictor must inform the restrictees of the other beneficiaries; and o Promissory Reliance: relied on a promise that the nearby lot would be restricted; depends on a representation/promise from the seller/restrictor o How to prove? Neighborhood scheme: subdivision plat and/or substantial uniformity o Nelle case: restriction must exist at the time of conveyance = Privity o Traditional rule: reservation of right to approve exceptions in the neighborhood scheme eliminates enforceability o Restrictive covenants are unenforceable by one not a party to the conveyance unless the covenants were made by a common grantor for the benefit of all grantees, One method of demonstrating this beneficial intent of the grantor is through a common, uniform, or scheme of restriction impsed on the property transferred out of the common grantor. o A remote grantee can reserve a reasonable power o Modern Tests: o Reasonableness: cant retain too broad of a power; must be limited o Judged by factors: breadth and use (if used too much, may be unenforceable) o How to terminate restriction? No limitation on the duration of RCs o Express language in restriction o Conduct o Statutory limit o Marketable Record Title Actonly requires you to search so far back in time o Changed Circumstances o Western Lands and Demarco cases: o Where must the changed circumstances exist? o Majority: change must be w/in the community o Minority: changes may exist in the surrounding areas o What does it mean that the nature of the circumstances have changed? o Changes that have occurred thwart/undermine the purpose/objective of the imposition of the restriction(s) o The changes must be physical and substantial o How do such changes occur? o Waivers that allow departure from the restriction(s) o Violations that went unprosecuted; must be recent and regular, substantial physical changes that thwart the purpose of the restriction in the first place Estates in Land and Future Interests: o For exam, discuss the type of interest (fee simple, etc.), then if its Defeasible, and lastly the future interest associated o What is the statute of uses? P.234 o Non-Freehold Estates: landlord-tenant relationships o (1) Tenancy for years (fixed term) o (2) (Most common) Periodic Tenancy: automatic renewal (month to month) o (3) Tenancy at Will: no specific term; lasts only as long as the 2 parties will it to o (4) Tenancy at Sufferance: when #1-3 ends. But the tenant does not vacate the premises o Eviction cause of action for removal OR 18

o No eviction and the tenant stays as long as the landlord suffers it; if payment resumes it reignites the previous type of relationship (#1-3) o Freehold Estates: ownership of the property o Can be absolute (cant be taken away) OR defeasible (can be taken away if dont satisfy a condition) o Fee Simple: to A & his heirs o Modern approach is to assume all conveyances give a fee simple unless there is a contrary indication o & his heirs are words of limitation: denoting the quantum of interest o A = words of purchase: denotes the purchaser/grantee o Largest estate one could have in terms of the legal interest; no future interests b/c gives everything away; potentially infinite in duration o Inheritable, devisable, and transferable inter vivos o Fee-Tail: to A & the heirs of his body o If this language is used today, it is a fee simple o Future interests are reversion or remainder (contingent or vested) o Inheritable only by the heirs of the body o Devisable only to the heirs of the body o Transferable inter vivos, but at death must go to the heirs of the body or revert to grantor o Life Estate: to A for life o Measured by the life of the grantee o Not inheritable, not devisable o May transfer inter vivos, but at death reverts to grantor o Measured by the life of a 3rd party or multiple parties of lives (pur autre vie): Devisable, inheritable and transferable inter vivos o Future interests are reversion or remainder (contingent or vested) o A tenant for life of a possessory estate has a right to the undisturbed possession of the land and to the income and profits thereof. His use and enjoyment is limited by the doctrine of waste; he is under a duty to refrain from any act that will diminish the value of the reversion or the remainder if the act is unreasonable. o Doctrine of waste: cannot deplete estate so successor has less of an estate o Mostly legal remedies available, but also equitable remedies o Remaindermen: somebody is going to have the interest in the property after you die and is entitled to a full and protected estate; these are the Remaindermen o 2 categories of waste: o Ameliorative waste: improvements on the property  At common law, Remaindermen could sue for any material change to the property even if it was an improvement  Modernly, this kind of waste is not actionable unless it imposes an unreasonable burden on the Remaindermen o Destructive waste:  Active:  Permissive/passive: dont do anything to consciously damage property, but failure to act damages the property; a life tenant has an obligation to make ordinary wear and tear repairs on property (keeping it wind and water tight); but no obligation to repair extraordinary damages o A lifetime tenant has emblement and estover rights to the property (ex) harvesting timber/crops on the land o Open Mines Rule: a life tenant may mine and remove minerals (and keep the profits) if the grantor had opened the mines or began the mining and removal before he granted the life estate o The life tenant is obligated to preserve the land and structures in a reasonable state of repair but is not bound to make expenditures for that purpose 19

o Defeasible interests: o (1) Determinable: the future interest created is a possibility of a reverter o Language to create a fee simple determinable: to A & his heirs while, during, until, so long as (limitation) o A Fee Simple Determinable is also an estate of potentially infinite duration o Significance of determinable: returns to the grantor automatically at the very moment the condition is not met o (2) Subject to condition subsequent: future interest = power of termination (re-entry) o Language to create a fee simple subject to condition subsequent: to A & his heirs provided that, on the condition that, but if, if it happen that o Significance: the future interest holder (grantor) must take action to get the property; it is not automatic o When determining if determinable or subject to condition subsequent: o 1st assume the language is of a covenant/promise, rather than a condition o 2nd (if it is not a covenant/promise, and it is a condition) assume the property to stay with the grantee, so presume it is subject to condition subsequent over a determinable o (3) Subject to executory limitation: future interest = executory interest o #s 1 & 2 give a grant that when the grantee loses the property, it comes back to the grantor o #3 when the grantee loses the property, it goes to a 3rd party o 5 Future Interests: o Reversion: 3 types of retained reversionary interests: the reversion, the possibility of reverter, and the right of entry for condition broken (power of termination). o Remainder: 4 types: the vested remainder, the vested remainder subject to open (vested remainder subject to partial divestment), the contingent remainder, and the vested remainder subject to complete divestment. o Vested: no condition precedent (may be a condition subsequent) and the Remaindermen are in existence and identifiable o Absolute: to A for life, the to B and his heirs = absolute vest; vested in interest and will vest in possession when A dies o Subject to partial divestment: subject to open (to A for life then to the children of A and his heirs = could be divided up among the children as A has more; a remainder given to a group that can grow or shrink may grow or shrink the interest. o Subject to complete divestment: vested in interest, but may or may not ever vest in possession.  A for life then to B and his heirs, but if B fails to graduate law school by the time of As death, then to C and his heirs y Present possessory life estate in A, future possessory vested remainder in B in fee simple subject to complete divestment w/ a future possessory shifting executory interest in C y Condition subsequent y No remainder b/c in order to have a remainder must get estate by a natural termination, but here its not when Bs interest naturally ends but when Bs interest is prematurely cut short y May not vest in possession before interest is taken away  A for life, then to B and his heirs, but if B or his heirs dont keep the house purple, then to C and her heirs y Will vest in possession before interest is taken away y Pp life in A, fp VR in B in fs subject to executory limitation, w/ a fp shifting executory interest in C in fs 20

o Contingent o Condition Precedent  A for life, then to B and his heirs if B survives A, if not, then to C and his heirs  pp life in A, fp CR in B in fs, fp alternative CR in fs in C o Remaindermen not yet in existence o Remaindermen not yet identifiable o Common law: inheritable but NOT devisable or transferable inter vivos o Modernly: inheritable, devisable, and transferable inter vivos o Power of Termination o Interest retained by the transferor who conveys an estate on condition subsequent o Common law: inheritable, not devisable or transferable inter vivos o Modernly: inheritable, devisable, not transferable inter vivos unless accompanied by a reversion, which means that you would have had to give less than everything away (not a fee simple)BUT OK does not require the reversion to accompany o Necessary for the grantor to enter the land OR commence an action to reclaim the land when the condition subsequent was broken; the grantor may waive the privilege of termination expressly or by conduct o Possibility of Reverter o Interest left in a transferor who creates a fee simple determinable o Common law: inheritable, not devisable or transferable inter vivos o Modernly: inheritable, devisable, and transferable inter vivos o Executory Interest o Springing (there is a gap in seisin)- on time or on condition o Note: the Rule of Perpetuities does not apply to springing executory interests based solely on a mere passage of time o Shifting o Some future interests are certainties, while others are questionable o Certainties: reversion, vested remainder o Question marks: possibility of reverter, contingent remainder, power of termination, executory interest o There are 4 basic limitations that control the use of Future Interests: o (1) Rule in Shelleys case o A for life, then to the heirs (or of the body) of A o Intent of grantor = pp life in A, fp CR in heirs (or of body) in A in fs o If in the same instrument, a life estate given to one party and a CR given to the heirs/of the body of the same party, then it was combined o Heirs cannot be grantors o After rule = Step 1: pp life in A (CR becomes >> fp VR) in A in fs/ft; Step 2: pp fs in A o Most Jxs have abolished except Arkansas and Colorado o (2) Doctrine of Worthier Title: it is worthier to take by inheritance than to take by grant o A for life, then to the heirs of O o pp life in A, fp reversion in O in fs o Modern approach: o Wills branch: allow will to do what it says (DWT is dead) o Inter Vivos branch: rebuttable presumption that heirs take by inheritance rather than by grant  Viewed as a rule of construction  Most Jxs follow (but not TX or ArK) 21

o NOTE: IN DWT AND SHELLEYS CASE DEALING INLY WITH CRS, NEVER EXECUTORY INTERESTS, SO IF WANT TO BYPOASS LIMITATIONS USE A SPRINGING EXECUTORY INTEREST: ONE DAY AFTER A DIES, TO THE HEIRS OF A o (3) Destructibility of Contingent Remainders o Modernly: this has been abolished by most Jxs; some have kept the idea of failure to vest o Common law: o Failure to vest:  A for life, then if B graduates law school by As death, to B and his heirs  If A dies before B graduates, the CR is destroyed and reverts back to O  Pp life in A, fp CR in B in fs, fp reversion in O in fs o Doctrine of merger: implies the coming together of 2 interests (1 smaller and 1 larger)  A for life, then to B for life, if B graduates law school by As death, then to A and his heirs  The CR in B intervenes a life estate in A and a fs in A  Release: if B gave CR to A, thereby destroying the CR  Conveyance Out: A transfers As life and fee simple estates out to a 3rd party, it combines the 2 and destroys the intervening CR of B  Separate Instrument: y A for life, then to B for life if B graduates law school by As death > in one instrument y Then, to A and his heirs > in another instrument y The moment this 2nd conveyance was made, the CR was destroyed o (4) Rule against Perpetuities: o Applies to executory interests and CRs NEVER pots or pors; disallows interests that will vest too distant in time o 3 steps: o (1) Look at the grant for the state of the title. Do you have a CR or EI? If yes, RAP applies. Does not apply to VRs! o (2) Assume contingency that will allow it to vest will be satisfied. o (3) Will it happening occur no later than 21 years after the end of any of the measuring lives with 100% certainty? (Measuring lives = any parties mentioned in the grant) o NOTE: RAP DOESNT APPLY TO A SPRINGING EXECUTORY INTEREST BASED SOLELY ON THE PASSAGE OF TIME, BUT WILL APPLY IF BASED ON A CONDITION o When the rule is applied to a (p.240 problems #2)  Condition subsequent: the condition and Bs interest will be eliminated so A would have the property w/o any conditions  Determinable: Bs interest is eliminated, but the condition is left in tact (subject to executory limitation) o Modern Rule: Jxs are split  Cy pres doctrine: rewrite the grant to preserve it (OK)  Wait and see doctrine: wait and see if the condition occurs w/in 21 years of end of measuring lives y If yes, valid y If no, eliminate it o Which of 5 future interests are not guaranteed to occur? Dont understand o Reversion- always there 22

o Remainder- vested=always there y Contingent- NOT GAURANTEED o Power of termination NOT GAURANTEED o Power of reverter- NOT GAURANTEED o Executory interest on condition= NOT GAURANTEED  On time= time will always pass Concurrent Interests: o A property owned simultaneously by 2 or more individuals o 2 questions to ask: o What kind of co-tenancy/concurrent interest is there? o What are the rights of the co-tenants stemming from that kind of interest? o Types of Concurrent Interests: o Tenancy in Common: own a determined percentage of the property o Each tenant has a right to possess the property subject to every other tenants right to possession. o Tenants in Common each hold an undivided interest in the whole property o Tenants in Common may freely convey their interests. The grantee becomes a tenant in common with the other tenants. When a tenant in common dies, that tenants interest in the property passes to that tenants heirs or devisees. o There is an interest in the share, not the whole; and there is NO RIGHT OF SURVIVORSHIP o The most common form of concurrent ownership is the tenancy in common. Each tenant in common owns a share of one piece of property. While the default rule is that each co-tenant has equal rights to possess the whole property and to share equally in rents and appreciation in value, the parties frequently own different interests in the land. On rebuttable presumption is the co-tenants own the land in proportion to the amount each contributed to purchase the property. Tenants in common normally share in the rents and sale proceeds according to their respective ownership interests. Even if co-tenants own varying interests in the property, it does not affect each co-tenants right to possess the entire property. o Joint-Tenancy: o Tenants have an interest in the share and whole of the property o There is RIGHT OF SURVIVORSHIP: when a joint tenant dies, the interests of the remaining joint tenants are enlarged proportionately. The Joint Tenant who survives all other joint tenants will be the sole owner of the entire property and can sell or devise the property. o The joint tenancy right of survivorship will supersede a will. o Joint tenants may freely covey their interests, thereby severing the joint tenancy. While a joint tenant is alive, he can transfer his fractional interest. This severs the Joint Tenancy because now the tenants no longer have the 4 unities of time, title, interest, and possession. The result is a tenancy in common with no right of survivorship. o 4 unties of title: o Cotenants obtained their interests at the same time o From the same instrument o The interests are identical o And undivided o A joint tenancy does not arise from intestate succession; when 2 or more persons inherit the same property, they become tenants in common o Since a joint tenancy ends on death, it cannot be devised or inherited. A joint tenant may, however, transfer or assign her interest inter vivos. The assignment ends the joint tenancy as to the transferee, who thereafter holds his interest as a tenant in common with the other tenants, who still have a joint tenancy among them. o To sever a joint tenancy: 23

o o

o States that recognize the 4 unities find a severance when one or more of the unities has been destroyed o States that do not emphasize the 4 unities look for some action or relationship that is inconsistent with a person continuing as a joint tenancy to find severance. A severance turns the joint tenancy into a tenancy in common for the severer, but the joint tenancy remains in tact to the other joint tenants. At common law, the presumption was for a joint tenancy. Now, the presumption is for a tenancy in common unless there is a clear indication to the contrary. Tenancy by the Entirety: limited to married couples o Includes a right of survivorship, but it cannot be severed unilaterally (indestructible). o Interest is in the whole, not the share of the property. o At common law, the presumption of property owned by a married couple was a tenancy by the entirety o Now, JXs are split because only 20 states still recognize tenancy by the entirety. Where it is not recognized, the presumption is: o Joint Tenancy because it maintains the right of survivorship aspect o Tenancy in Common because that is the modern common law presumption o If in a JX that does recognize a tenancy by the entirety, and it turns out the couple is not married, there is a split in the JXs as what to do with the property o Ignore the conveyance and pretend it never happened o Joint Tenancy was the old common law approach/presumption o Modernly, the majority of JXs will presume a tenancy in common o If in a JX that recognizes tenancy by the entirety and they divorce, the JXs are split: o Presume a tenancy in common results (majority) o Presume a joint tenancy results because it keeps the right of survivorship in tact (minority) Creation of Concurrent Interests: o In RE Estate of Michael: o General Rule: there is a presumption of a tenancy in common without a right of survivorship unless express intent shown to the contrary. o The normal procedure to create a right of survivorship is the phrase, Joint tenants, with a right of survivorship, and not as tenants in common. (language to create a joint tenancy) Rights of Creditors o Sawada case: What happens if couple married and one spouse incurs debt? 4 approaches to what cotenants can do when creditors are making a claim against part or all of the shared property. Whether the interest of one spouse in real property, held in a tenancy by the entirety, is subject to levy and execution by individual creditors. o Common Law Approach: The estate is essentially the common law tenancy by the entireties. The possession and profits of the estate are subject to the husbands exclusive dominion and control. o Group II: The interest of the debtor spouse in the estate may be sold or levied upon for his or her separate debts, subject to the other spouses contingent right of survivorship. o Group III: An attempted conveyance by either spouse is wholly void, and the estate may not be subjected to the separate debts of one spouse only. o Group IV: the contingent right of survivorship appertaining to either spouse is separately alienable by him and attachable by his creditors during the marriage. The use and profits, however, may neither be alienated nor attached during coverture. o E & Es: o Majority: a creditor can foreclose on the tenancy by the entirety property only if both spouses are liable for the underlying debt or both have executed a mortgage. Husband and wife must both execute deeds on the sale of the property. 24

o A creditor of one spouses separate debts may foreclose on the debtor spouses half interest subject to the other spouses survivorship rights. Thus the creditor can get rents from the property if any are collected but will lose all rights in the property if the non-debtor spouse survives the debtor spouse. o Minority: Creditors can reach a spouses survivorship interest, but not the right to current possession and rents. Hence creditors have no interest while both spouses are alive, and will have an interest only if the debtor spouse survives the non-debtor spouse. o Graham case: o Question of partition: can you divide up the property as co-tenants? Yes. The undivided interest can be converted into identifiable divided interests o Available voluntarily or by forced partition o In kind: divide up land/property o By sale: divide up proceeds from a sale o Contribution to repairs and improvements made on the property o A co-tenant made improvements, can she have the others help pay? o General Rule: a co-tenant has no right to seek contribution for improvements or repairs in the absence of an agreement o A co-tenant cannot get contribution for improvements or repairs, even necessary repairs because no co-tenant has the duty to make repairs or improvements. o Exception: allow contribution for repairs/improvements when being sued for an accounting (or an accounting with a partition) o How much money can you get in contribution for improvements, if there is an agreement? o Majority View: the lesser of either the amount the property was enhanced or the cost it took to make the improvements o Accounting: for rents, profits, and value of use o Must account for rents and profits o An accounting occurs when a co-tenant rents the property to a third party; once he leases or rents the property to others, he must account for nay profits and share the net proceeds with his co-tenants. He may offset these proceeds with costs for taxes, interest, insurance, improvements and repairs o Do not have to account for value of use unless  There was an agreement; or  You ousted; or  If had a request for accounting in response to your request for contribution. o Can a tenant out of possession make a claim for an accounting?  Rents and Profits? YES  Value of Use? ONLY IF THERE WAS AN AGREEMENT, OUSTER, OR IF IT IS BROUGHT IN A COUNTERCLAIM o Coggan case: about ouster o The question was whether there was an ouster? o Who has the burden? The Plaintiff must demonstrate that he or she was ousted by defendant co-tenant o What constitutes evidence of an ouster? An indication of excluding the Plaintiff. Must show exclusivity. o The majority rule is that a co-tenant using the whole property, absent ouster, does not owe rent to the other co-tenants. In a small minority of states, a co-tenant using the property owes a fair rental to the remaining co-tenants. In the majority of states where a co-tenant owes no rent to his co-tenants for using the property, the rule changes of the occupying tenant ousts 25

the other co-tenants. Ouster occurs when the occupying tenant acts to prevent the other cotenants from using the property. Evidence of ouster includes: o Changing the locks o Making use of the property in a way that no other use can be made of any part of the property and refuses to make room for anothers use. Generally, before the ousted cotenant can bring an action for ouster, the co-tenant must make a demand for access to the property and be denied access. o Termination of Co-Tenancies: o Agreement o Partition o Severance o Shepherd case: What is the effect of a tenancy by entirety of a divorce? o Tenancy by the entirety is terminated because no longer husband and wife o What co-tenancy is created? o Common law: Joint tenancy is created because divorce just ends the indestructible right of survivorship in a tenancy by the entirety. The regular right of survivorship is left in tact. Also, it was the common law presumption to create a joint tenancy. o Modern rule: Majority = tenancy in common; Minority = joint tenancy o Porter case: What if husband and wife as joint tenants divorce? Divorce by itself does not affect a joint tenancy, there must be something else, in the form of a clear intent to destroy the right of survivorship o Taylor v. Canterbury: o Modern Rule: you can unilaterally terminate a joint tenancy o Old Common law: strawman approach: where a person briefly takes legal title for the sole purpose of re-conveying the property back to his grantor. o Tenhet case: o Is a lease the same as a conveyance by a tenant in a joint tenancy, severing the joint tenancy?/What is the effect of a lease on a joint tenancy? o Common law/harshest rule: a lease severs a joint tenancy o Most lenient rule: a lease does not sever a joint tenancy o Majority/Moderate Rule: a lease creates a temporary severance: if the lessor joint tenant dies during the term of the lease, the joint tenancy is at end because at the time you gave the lease, you severed the joint tenancy. If the lessor joint tenant survives the lease, the joint tenancy resumes o If in the lenient JX, will the surviving joint tenant take on the lease? NO. The lease is at an end because the lessors interest ceased when he died. o What happens to the lease in a majority JX if the lessor dies? A tenancy in common results and the lease remains in tact o What if a joint tenant gives a mortgage? Does it terminate the joint tenancy? There is a split in the JXs: o Lien Theory JX: giving of a mortgage simply creates a claim, not a transfer of title so does not terminate the joint tenancy o Title Theory: giving of mortgage is equated to the transfer of a title and terminates the joint tenancy o Coolidge case: Joint tenants want to partition. a partition may be barred by an agreement between the parties either express or implied but mere contemplation against partition is not sufficient to raise such an implied an agreement. o Von Behren case:

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o A division in kind is favored unless it would result in great prejudice to the owners (value of share of each would be materially less than the share of the money equivalent each would obtain from the whole) o Court will look to equality of division: not just the number of acres, but including all factors that have bearing on the value) Non-Possessory Rights and Interests in the Land of Another: Easements, Licenses, and Real Covenants o Easements: o Appurtenant: attached to the land (burden/benefit is on the land, not the person); benefits the land o In Gross: personally benefits the holder of the easement (i.e. hunting, using the land for own enjoyment) o The person who has the benefit is the dominant estate holder o The person who has the burden is the servient estate holder. o Express Easements:  Corbett case: y Easement by grant y Easement by reservation or exception: reserve the use of that part of the land because planning on conveying a portion of the whole property away y Neither statutory nor common law requires a grantor to employ words of art so long as the intention to grant is so manifest on the face of the instrument that no other construction could be y An easement is not presumed to be one in gross; the intent of the parties is the critical determinant; the test of the appurtenancy is whether the easement is a useful adjunct to the property; an easement appurtenant is one capable of being transferred and inherited while an easement in gross is not. y Appurtenance attaches to the land and so is presumed permanent unless clear indication otherwise is present y How can you tell if an easement is appurtenant? y Even when the grant of easement is made without a term, courts may presume that an appurtenant easement was intended to terminate when the purpose for which it was created can no longer be served. y Or, a landowner can make an easement expressly terminable on the same basis. y VIPs: cannot make/have an easement on own land; express easement by grant requires no magic words as long as intending to make it; an appurtenant easement may run to the successor  Statute of Frauds mandates that express easements be created by written provision because interests in land  Right of way across a strip of land = a grant of easement  Strip of land for a right of way = grants the strip of land  No longer needed: easement ceased to be used o Implied Easements: necessity vs. quasi  Schmidt case: quasi easements y To establish an implied easement, 3 things must be shown: o During the unity of title an apparently permanent and obvious servitude was imposed on one part of an estate in favor of another o Continuity; and o The easement is reasonably necessary for the fair enjoyment of the property it benefits y The party asserting the easement has the burden of proving the claim by a preponderance y An implied easement may arise in 2 ways: 27

o Implied from necessity; and it requires a showing of strict necessity o Implied from a quasi-easement  Majority: an implied grant of an easement requires a showing of reasonable necessity; an implied reservation of an easement in the grantor requires strict necessity  Minority: only reasonable necessity is required for both! y Plaintiff must show the easement was apparent at the date of severance; a lease alone may not be enough to sever; but a lease with an option for purchase is; and so when the other party takes over, even in this kind of lease, there is severance and the easement must be apparent at that time!  Whitt case: an implied easement arising from a quasi-easement y Implied Easement upon the Severance of the Estate y An easement will be implied where: o There was a common ownership at the time the estate was severed o The common owners use of part of his land to benefit another part was apparent and continuous o The land was transferred; and o At severance, it was necessary to continue the pre-existing use for the benfit of the dominated estate.  De Ruscio case: y Who is entitled to bring action o In an implied easement by dedication: every member of the public o In a filed subdivision plat: only people who bought in the subdivision y When property is described in a conveyance with reference to a filed subdivision plat showing streets abutting on the lot conveyed, easements in the private streets appurtenant to the lot generally pass with the grant. Whether an implied easement was in fact created depends on the intention of the parties at the time of the conveyance. Requires proof that the deed from the original subdividing grantor referred to the subdivision map or of the abutting paper street. y Remedy: only entitled to the most direct route o Prescriptive Easements: essentially adverse possession  White case: Prescriptive easement elements: y Use: must be continuous and uninterrupted; does not have to be daily; claimant must exercise the use as frequently as convenience or necessity requires y Open and notorious/visible: must give owner notice of the adverse use either by actual notice or constructive notice (where use is sufficiently open and notorious to apprise a diligent landowner of its existence) y Adverse to the owner: it is only necessary for the use to proceed without recognition of the owners authority to permit or prohibit the use; it is not necessary that the user intend to violate the owners rights y For a period of required time y No requirement of exclusivity: there can be use by the prescriptor and the record title holder y Lost grant theory (minority)- happened so long ago, mustve been a grant, just lost  Fox case: y A party must submit reasonably clear and convincing proof of open, notorious, continuous, uninterrupted use, under a claim of right, with the knowledge of the owner for a period. A prescriptive right cannot arise if the use of the land is with the permission of the owner. y Lost Grant p. 319 28

Persons of the general public and the local community are too broad a group to acquire an easement by prescription (exception = public highways) y A party claiming a right by dedication has the burden of proof on every material issue y Implied dedication of property: is not supported by long, continuous use alone o Dedication is never presumed o Intent of the owner to dedicate his land to public use must be clearly and unequivocally shown y Custom: the general public could after many years of unrestricted common usage acquire rights over private property. Requirements: o Continued from time immemorial without interruption o As a right o Must be certain as to place and as to persons o Certain and Reasonable as to subject matter or rights created y Public Trust Doctrine: applies to public resources such as navigable waters and tidal lands; and allows for public access for recreation, navigation, and harvesting purposes; but if it is not applicable of there are other points of access available.  Fountainebleau case: y Where a structure serves a useful and beneficial purpose, there is no COA, even if it causes injury y Rejection of the Ancient Lights Theory: free flow of both air and light to your property from someone elses y 3 Exceptions to the modern rule of no free flow of air and light: o Express agreement with adjoining landowner o Statutory requirements o If no useful, beneficial purpose and there was a malicious intent o Scope of Easements:  For an express easement, look to the express language  In a prescriptive easement, look to the actual use  In a quasi-implied easement, look to what/how much had been used prior to the severance (when the easement was in its quasi status)  In an implied easement by way of necessity, there is strict necessity, so what is the direct route?  Hayes case: y A dominant estate owner has the right to make reasonable improvements to an easement, so long as the improvement does not unreasonably increase the burden upon the servient esatate y The person holding the easement (the dominant estate holder) must maintain it y If surcharging the use (increasing the extent, degree, or amount of use), it must be a reasonable increase, which is a question of fact for the jury to decide)  Kinds of Use to which a particular easement may be limited? y If there is express, limiting language, then you are stuck with that language y But if there is no express limitation, the easement can evolve to accommodate evolution for how the easement would be normally/reasonably be used (in accordance with evolving technology) y What about in a prescriptive easement? The easement can also evolve to accommodate y Quasi? Accommodation allowed.  Purpose for which the easement may be used? y Can use an easement for any purpose it is naturally subjected to, unless there is an express limitation y For a prescriptive easement, the only purpose permitted is the on in which was used during the adverse use 29 y

Schold case: A servient landowner may maintain gates across the way if necessary for the use of the servient estate and if the gates do not unreasonably interfere with the right of passage (and I not expressly prohibited) o Maintenance of Easements: Triplett case:  In the absence of an agreement to the contrary, the owner of the easement has not only the right but also the duty to keep the easement in repair, while the owner of the servient tenement has no duty to either put or keep the easement in repair.  The only duty the owner of the servient tenement has is not to interfere with the use of the easement for purposes of access by the owner of the dominant tenement, that is, the owner of the easement  Neither of the parties can change the location of the easement without consent  The owner of the dominant estate cannot make a material alteration in the character of the easement, even though it be more to his convenience to do so, if the alteration places a greater burden upon the servient estate or interferes with the use and enjoyment of the servient estate by its owner o Transferability of Easements: Miller case:  No prohibition of assignment of an easement in gross if the parties to its creation evidence their intention to make it assignable  Is an easement divisible? Yes as long as does not unreasonably burden the servient estate; if there is a division, the easement must still be used or exercised as an entirety  The traditional rule was that easements in gross were not assignable and died with the holder; but commercial easements in gross are assignable  Easements in gross by prescription are also transferable (even without language of intent) if has a commercial, social use or economic utility  One Stock theory of easements: cannot unilaterally transfer a part of the interest away; must have the consent of the other interest holders o Termination of Easements:  Express provision  Release  Merger  Cannot by adverse possession  Prescription (obstruction, new user)  Bona fide purchaser taking without notice of the easement  Necessity ends (for a by way of necessity implied easement)  Abandonment: Lindsey case: y Abandonment is a question of intention y Cessation of use coupled with acts or circumstances clearly showing an intention to abandon the right will be as effective as an express release of right y Mere non-use does not equate to abandonment y Burden to show abandonment is on the party claiming it y Cannot have an equitable remedy where party claiming injury had notice or should have had notice by construction or inquiry y Court will not require expensive removal of the obstruction, so long as an alternative is made available y Intent: o Failure to use/discontinuance o With clear intent to relinquish  3 requirements of Estoppel: servient estate holder y Extend financial resources in the area where the easement exists y No knowledge/no easy way of ascertaining knowledge of easement y Dominant estate holder: must know whats going on and doesnt object  30

o Licenses: o Revocable at will (unlike an easement) o Mere permission o Not an interest in land o No Statute of Frauds o Can be in writing, orally, or a failed attempt at a lease or an easement o Mosher case:  A license = an authority to do a particular act or series of acts upon anothers land without possessing any estate therein  Rule: Revocation of Licenses: y Terminable at will y Licensee must be given a reasonable opportunity to remove himself and his effects from the land; a licensee has a reasonable amount of time to leave when license (permission) has been revoked. y Not to prevent the license from being effective to protect the interest with which it was coupled y To the extent reasonably necessary to realize upon his expenditures o Linro case:  A license from a failed attempt at a lease  Creation of a lease depends on intent of the parties, not on their characterization of the agreement  A lease gives the tenant exclusive control (exclusivity over a defined space)  A license is a personal, revocable, and a non-assignable privilege  A license is extinguished upon the conveyance of the property o Stoner v. Zucker: A license can become something of a higher level from detrimental, reasonable reliance on it lasting a period of time, called an irrevocable license or easement by estoppel Chapter 7: Governmental Control of Private Land Use; Eminent Domain/Takings o Legal issues that arise when the government acquires private property through the power of eminent domain o Government limitation = 5th amendment: nor shall private property be taken for public use, without just compensation o Kelo case: o The sovereign may not take the property of A for the sole purpose of transferring it to B (another private party) even when A is paid just compensation o A state may transfer property from one private property to another if future use by the public is the purpose of the taking (public purpose = public use) o Look to the entire plan, not on a piecemeal basis o Government may compel an individual to forfeit her property for the publics use, but not for the benefit of another private person o There are 3 categories of takings that comply with the public use requirement:  Sovereign may transfer private property to public ownership (i.e. for a hospital, road, military base)  Sovereign may transfer private property to private parties, often common carriers, who make the property available for the publics useRR, utility, stadium  Takings that serve a public purpose also satisfy the constitution even if the property is destined for subsequent private use. o If there is a private taking for another private party, it must be:  Available for public use  A legislative intent (i.e. to break up a land oligopoly)  Raise revenue; or  To improve a blighted area 31

o Penn Central case: regulation of the conceptual segmentation of the air space o Test for when a regulation constitutes a taking:  The extent of interference with distinct investment backed expectation; balanced with/weighed against  Character of the government action: y Government objective y Physical invasion y Effect/consequences of the governments action o Physical invasions are always takings; regulations are not always takings o Different from Colby (guys house next to AF base) because there was physical invasion of his property. Constitutes taking. o Loretto case: physical invasion of the geographic segmentation o A physical invasion = a taking o The extent of the occupation is a factor in determining compensation o Not inconsistent with penn central o First English case: regulation of the temporal segmentation that controls all use and so goes too far! If gov regulation controls everything, does constitute taking. o Lucas case: o Categorical Takings of government action that are compensable without doing the Penn Central balancing test:  Physical Invasion (no matter how small!)  A regulation that denies all economically beneficial or productive use of land o If there is no categorical taking, then go to the Penn Central balancing test o Background Principles: define per JX the property rights/ what you actually have; important because need to know what interest you have in your property to know if it is being taken away Zoning: o Euclid case: o What is the constitutional validity of zoning regulations? Must go through a due process analysis o There must be a reasonable, substantial relationship to health, morals, safety, and the general public welfare for the zoning regulation to be allowed. o Rational basis examination of substantive due process or equal protection o Euclidian Zoning: traditional: divides land up so you have discrete uses of part of the land o Issues in Zoning: o Can a zoning plan be changed? o What standards are there used to evaluate a proposed change?  Is the change discriminatory? It cannot discriminate; it must comply with equal protection  Is the change designed to promote health, safety, morals, and the general public welfare? If no, it will fail a due process analysis  Pre-existing, non-conforming use: is it inconsistent with the surrounding areas? y What if property was damage or destroyed? Can it resume is pre. Use? o Variances; Special Exceptions: granted by the board of adjustment

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