Gives the owner of the estate title to or a right to hold the property. 

Non-freehold estate grants only possession. 

Largest possible estate in land, denoting all possible rights in the land including: 

(a) unimpeded right to sell or convey all or part of the property; and 

(b) umimpeded right to devise the property. 

"To A and his heirs" 

"To A" acceptable under modern law.  

"for so long as" 

"during" 

"while" 

"until" 

Durational words. 

"provided, however"

"however, if"

"but if" 

"on the condition that" 

"in the event that" 

"To a for so long as premises are used for charitable purposes, but if the presises cease to be used for charitable purposes, then to B." 

Use of 3d party potential grantee. 

"To A and the heirs of her body." 

Can be limited to male or female heirs. 

Fee Tails are disfavored. 

If the grant uses fee-tail language, most states grant fee simple absolute. 

In a minority of states, grantee has a life estate with a remainder per stirpes in grantee's lineas descendants in being at the time of the life tenant's death. 

Life estate measured by the duration of the life of someone other than the grantee. 

If grantee predeceases autre vie, grantees heirs have remainder of life estate. 

Tenant for term of years has a duty to maintain property in rex state or repair, rdinary wear and tear expected. However, duty is not limited to the extent of income derived or rex rental value. 

Lessee's duty is now largely governed by statutes that tend to relieve the tenant of a duty to repair. 

No common law duty to pay property taxes unless: 

(a) lease is perpetual or for a long term with option to the tenant and successors to renew forever; or

(b) the tenant holds without obligation to pay rent; or

(c) tenant has erected improvements on the leased premises for his own benefits. 

Life tenant must pay full cost of special assessmemnt--taxes levied against property because of public improvement--to the exten of income derived if the life of the improvement is less than the duration of the tenant's life estate. 

Equitable apportionment is applied for improvements likely to last longer. 

No common law duty to pay special assessments. 

Part of broader rule allowing tenant to avoid paying carrying charges--i.e., insurance premiums. 

An estate that is limited in duration. 

LL maintains fee, subject to the leasehold interest. 

descendable in all state. 

Majority of state agree that right is devisable 

Minority of states prevent inter vivos transfer. 

Begins to run when grantor attempts to exercise right. 

Minority: begins to run when condition occurs. 

Future interest retained by grantor when the grantor transfers less than a fee interest to a third person. 

Look for transfers where entire fee is not accounted for. 

Future interest in a third person that cuts short the previous estate before it would have naturally terminated. 

Any interest in a 3d party following a fee estate. 

Shifting Executory Interest: Interest that cuts short a prior estate created by the same conveyance. Interest passes from one grantee to another. 

Springing Executory Interest: Interest that follows a gap in possession or divests the estate of the transferor. Interest passes from grantor to grantee. 

Remainder is contingent if: 

(a) takers are unascertained; or 

(b) the interest is subject to a condition precedent and, therefore, does nto fall in automatically on the natural termination of the previous estate. 

Executory interest cuts short the previous estate. 

Remainder arises where the previous estate terminates naturally. 

At common law, a contingent remainder in real property is destroyed by any of the following: 

(a) if it fails to vest by the natural termination of the prior, vested estate; or 

(b) doctrine of merger; or

(c) holder of the present possessory estate surrenders his interest before the contingest remainder vests. 

Merger occurs when one party who possess a present or future interest in the property, by subsequent transactions, obtains all outstanding interests in the property. 

E.g., by surrender of the present estate to the owner of the future estate, release of a future estate to the present estate owner, when all holders of present and future vested intrests convey those interests to third parties. 

Many jurisdictions have abolished. 

If a contingent remainder has not vested at the natural termination of the prior, vested estate, the contingent remainder becomes an executory interest, subject to RAP. 

Remainder that: 

(a) Has been made to a class; and

(b) has at least one member who is ascertainable and who has satisfied any conditions precedent to vesting, but it may have members join the class later. 

Rule against remainders in grantee's heirs. 

Arises where "O conveys to A for life, remainder to the heirs of A." 

The property goes to A to leave in his will as he choses. 

Most jurisdictions have abolished. 

"O conveys to A for life, remainder to the heirs of O"

Creates a presumption that O intended to create a revesion in himself. Presumption may be rebutted by CCE. 

Under modern law, this rule applies to intervivos transfers only. 

Possessor of a life estate or leasehold interest may not adversely affect the future interest that folows the life estate. 

Waste is an act that adversely affects the future interest. 

Natural resources may be consumed: 

(a) for repair and maintenance of the property; or 

(b) with permission of the grantor; or 

(c) under the open mines doctrine: if the grantor was exploiting the natural resources of the mine, it is presumed that the grantee has the right to continue that exploitation. 

Occurs if the life tenant or leasehold tenant permits the premises to fall into disrepair. 

May also occur if the life tenant fails to pay motrgage interest payments, taxes, or the tenant's share of special assessments. 

(1) The market value of the remainderman's interest is not impaired; and 

(2) either: 

     (a) remainderman permits the waste or; 

     (b) a substantial and permanent change in the neighborhood justifies the waste. 

Grantee loses his estate if he attempts to convey. 

Valid for life estates and future interests only. Not valid for fees. 

Promise not to convey. 

Valid for life estates and future interests. Not enforceable for fee estates. 

Breach makes the promissor liable for breach of K damages. 

May be enforced with court weighing the duration of the restraint and the number of persons excluded. 

If the class is already closed by the time the postponing period ends, all members of the class will be included in the class.

If the class is not yet closed, all persons born when the postponing period ends may take. 

If the class has no members at the time the postponing period ends, any member, whenever born may take. 

Gift made to a class with a postponing period and conditions precedent. 

When the last condition precedent is satisfied and the postponement has ended, the class closes. 

Afterborn persons are excluded. 

present possessory estates

charitable trusts

resulting trusts

interests that are fully vested at the time of the creation--reversionary interests, completely vested remainders. 

life-in-being must be in some way connected to the vesting of the interest 

e.g., person named in the document, person implied in the document--"to my grandchildren" implies parents. 

If condition is met by one member of class at the time of creation, the class is closed to afterborn children. 

If no member of the class has met the condition, then the class is subject to the RAP. 

Two or more persons share concurrently an interest in real property.

Concurrent owners are called co-tenants. 

• Inter vivos transfer 
• voluntary: conveyance, lease, mortgage, etc...
• Involuntary: foreclosure on mortgage or creditor's lien
• Devisable
• descendable 

Available in Joint Tenancy. 

When one tenant dies, the other inherets the other tenant's interest in the property automatically. At the death of one joint tenant, the interest of the surviving joint tenant "grows" and absorbs the interest of the deceased joint tenant. 

(1) Unity of Time--Joint Tenants must take at the same time

(2) Unity of Title--Joint Tenants must take by the same instrument

(3) Unity of Interest--Joint Tenants must take equal shares of the same type

(4) Unity of Possession--Each Joint Tenant has the right to possess the whole. 

• Transferrable
• voluntarily
• involuntarily
• cannot be devised or descended because the other joint tenant inherrets the decedent's interest. 

• voluntary
• Involuntary: 
• creditor forces sale to satisfy debt. 
• Creates tenancy in common

Mortgage as joint tenants does not affect joint tenancy. 

Title Theory: Execution of mortgage by one joint tenant causese legal interest to be transferred to mortgagee. Mortgage severs joint tenancy because unitites have been destroyed. Minority rule. 

Lien Theory: mortgagee only receives lien on property. There is no severence. But foreclosure does sever joint tenancy. 

Modern trend is to allow co-tenant to seek contribution for necessary repairs. 

In partition or accounting suit, cost of repairs may be an offset. 

Co-tenant who pays taxes/mortgage may seek contribution or recover in accounting/partition suit. 

Co-tenant in sole possession will only receive reibursement to the extent payment exceeds market value of property. 

Each tenant has right to seek: 

(1) Voluntary Partition: exchange of deeds or by sale. 

(2) Involuntary/Judicial partition: in-kind, physical partition is preferred. If partition cannot be made equal, the party receiving more has to make payments to other tenant. 

Possession that is

(1) open, visiblem and notorious

(2) Actual: using land or having color of title

(3) Exclusive

(4) Hostile and under claim of title or right: hostile means possessing land in a means that is inconsistent with the rights of the owner. 

(5) Continuous: depends on what is the best use of the property--i.e., seasonal versus daily. 

color of title and actual possession of related property. 

If land is divided into distinctive lots, constructive possession will only exted to the lot the possessor actually occupies. 

If a 3d person is in possession of part of the premises, constructive possession will not exted to the portion that party possesses. 

Majority: hositility established by intent to be on land. 

Minority: possessor must act in good-faith belief that the land is his. 

A few: possessor must act in bad faith. 

Running of a statutory period may be tolled if there is a disability in the actual owner that exists at the time the adverse possessor enters. 

Disability: nonage, legal incompentence, imprisonment. 

(1) Description of the property; 

(2) Description of the parties; 

(3) Price; and

(4) Any conditions of price or payment if agreed on. 

Doctrine of Part Performance

Equitable Estoppel: based on act or representation

Promissory Estoppel: Based on promise. 

Act of part performance unequivocally proves existence of K. 

A showing of all or some of the following must be made: 

(1) payment of all or substantial part of purchase price

(2) taking of possession

(3) making substantial improvements

Purchaser becomes equitable owner of title at the time of the execution of a binding contract. 

Risk of loss is on buyer on execution of contract for sale of property. 

Minority: risk of loss is on seller unless legal title or possession has passed to buyer. 

(1) Defects in chain of title

(2) Encumbrances

(3) Encroachments

(4) Zoning Restrictions

(a) Adverse possession,

(b) Defective execution of a deed, or

(c) Significant variation of description of land from one deed to the next

Minority View

title acquired by adverse possession may be marketable iff: 

(a) possession has been for a very long time; 

(b) the risk that the record owner will sue is remote; and 

(c) the probability of record owner's success is minimal. 

right or interest that another person has in real property that diminishes the value of the property but is consistent with the conveyance of a fee interest in the property. 

Mortgages, liens, easements (making property servient estate), covenants/servitudes. 

parties can contract. 

Seller can use proceeds of sale to satisfy mortgage or lien. 

Must be a significant encroachment. 

Parties can contract for encroachments not to defeat marketable title. 

Existence of a zoning restriction does not make title unmarketable. 

A zoning violation may render title unmarketable. 

Do not render title unmarketable. 

E.g., termites. 

A seller of a residential home has a duty to disclose material latent defects known to the seller but not readily observable and not known to the buyer.

Duty only applies to commercial builders in most Js. 

Some states extend to used homes. 

defects that affect the health and safety of the occupants. 

Some states apply to defects that affect value as well as health and safety. 

Some extend defect to mean physical defects both on and off premises. 

But always physical defect on premises. 

Some states extend duty to non-physical defects as well. 

Most Jurisdictions recognize implied waranty of quality to new/remodeled homes. Imposed on commercial venders. 

Extends to subsequent purchasers only in some jurisdictions. 

(1) Expectation damages: contract price - market price at the time of breach

(2) foreseeable consequential damages: e.g., mortgage interest payments

(3) Rex Reliance Damages: repairs and cost of inspection

(4) Down Payment Amount: allowed if there is liquidated damages provision or if use of one would be rex. 

(5) Punative damages for willfull breach. 

Liquidated damages provision is reasonable iff: 

(a) injury caused by breach cannot be accurately estimated, and

(b) liquidated damages are rex forecast of the harm caused by the breach. 

(1) expectation damages: contract price - market value at time of contract. Some courts will use reasonable price in rising market.

(2) reliance damages

(3) restitution of down payment: slight majority do not limit restitution to amount of down payment. 

(4) Punitive damages if breach is willful. 

If seller dies before closing, property passes to devisees, but the devisees must honor the K. 

If buyer dies before closing, party that takes descendant's realty may demand closing an exoneration of liens from estate of decedent. 

Covenants in contract merge into deed at closing. 

Modern approach: merger does not apply to matters collateral to or not mentioned in deed. 

General Warranty Deed

Special Warranty Deed

Quitclaim Deed

Present Covenants: 

• Seisin: grantor owns and possesses estate
• Right to Convey: Grantor has right to convey 
• Covenant against Encumbrances: grantor promises there are no encumbrances on the property--e.g., mortgage and judgment liens, taxes, leases, water rights, easements, and restrictions on use. 

Future Covenants: 

• Quiet Enjoyment: grantee will not be disturbed by superior claim
• Covenant of warranty: grantor will assist against assertion of superior title
• Covenant of Further Assurances: Grantor will take necessary steps to perfect title. 

(1) Breach of seisin, right to convey, general warranty, and quiet enjoyment, grantee may recover full purchase price if grant is voided. 

(2) Breach of encumbrances, damages are measure by cost of removing defect. 

Runs for present covenants when deed is delivered. 

Future covenants begin to run when 3d party asserts superior title. 

(1) Donative Intent: Intent to transfer interest immediately to grantee. 

(2) Delivery

(3) Acceptance

usually by physical delivery. 

Can be done through words--decl of intent and relinquishment of control. 

Arises where: 

(1) Deed is later found in grantee's possession; or

(2) deed is properly executed and recorded; or

(3) deed contains attestation clause that attests to delivery

Always admissible to show that a deed absolute is intended as a mortgage and that grantor did not intend deed to have present effect. 

Most courts permit proof of oral conditions on deeds if delivery is to 3d party. 

Majority: if delivery has been made to grantee with oral condition, conveyance is valid. Oral condition may not be proved. 

Minority: if delivery has been made to grantee withoral condition, conveyance is void. 

Few: conveyance is valid and condition may be proved. 

Race

Notice

Race-Notice

first to record wins. 

Language: "No transfer shall be valid but from the time of registration thereof in the county where the land lies." 

(1) claimant took subsequent in time to another person claiming ownership; and

(2) claimant is a BFP; and

(3) Claimant took without actual, constructive, or inquiy notice of other owner. 

subsequent purchaser is only protected if they paid value. 

If purchaser has paid some but not all: 

Majority: buyer is protected pro tanto

Some: partial payment is not sufficient

(1) Actual Notice: claimant actually sees deed or otherwise knows

(2) Constructive/Record Notice: other party's deed is recorded in proper place. 

(3) Inquiry Notice: appearance of property is such that claimant should have asked more questions about title. 

(1) claimant took subsequent in time to another person claiming ownership 

(2) claimant was BFP

(3) Claimant took property wihtout notice

(4) Claimant recorded first

Tract Index: Indexed based on tract of land. always provides constructive notice. 

Grantor-Grantee Index: look at each individual sale in grantor index, then grantee index. 

Deeds cannot be washed by conveying

No fraud can be used to protect

document that conveys an interest in real property designed to secure performance of a debt. 

Must be in writing: 
(a) Identify parties (Mortgagor and mortgagee)

(b) Describe the proeprty: sufficient info to put BFP on notice

(c) Intent to create security interest.  

Creates personal liability in mortgagor. 

Components: 

(a) Loan amount

(b) interest rate

(c) loan term

(d) prepaymet clause

(e) acceleration clause

(f) due on sale clause

Common Law theory. 

mortgagee receives legaltitle to mortgaged real property with right to take possession and collect rents. 

Mortgage is subject to condition precedent, passing title to mortgagee upon full payment. 

Mortgagor has equitable interest only. 

mortgagee receives a lien. 

Mortgagor obtains equitable title, legal title, and possession. 

Most common. 

mortgagor retains legal title until default. After default, motrgagee begins to collect rents and profits and may take possession. 

Differs from Title theory only in that title theory grants mortgagor ability to take possession and collect rents at any time. 

has a duty to pay the interest on a mortgage. The duty is capped at: 

(a) rents and profits derived from a 3d person in possession of the property; or

(b) reasonable rental valueof the premises, if the tenant remains in possession. 

Mortgagor or Life Tenant: 

(1) fails to pay property taxes or assessments that have priorityover the mortgage; 

(2) makes physical changes to the property that, negligently or intentionally, reduce the value; 

(3) fails to maintain and repair the property in a rex manner, except if cause by 3d party fault; 

(4) fails to comly materially with mortgage covenants respecting physical care, maintenance, construction, demo, or insurance against property/improvements; and

(5) retains rents which mortgagee has no right to possess. 

Mortgage: Mortgage-Related Waste: Pneumonic: 

My Rubbish Makes The Castle Ruined

Mortgage, Reduce Value, Maintain, Taxes, Covenants, Retain Rents

(1) foreslocure if the waste has impaired the security

(2) injunction against future waste or correction of past waste, limited to extent waste impairs security

(3) Recovery of damages, limited to amount of waste to extent that waste impairs security. 

(1) obtain judgment against any person liable and foreclose to extent judgment is not satisfied; or

(2) foreclose mortgage and, to extent proceeds of sale do not satisfy obligation, obtain judgment for deficiency 

foreclosure occurs without judicial action, pursuant to power-of-sale clause in mortgage document. 

No deficiency judgments. 

Publi, properly noticed, conducted in rex manner under statute, and result in fair sale price. 

Fair price is about mortgagee's diligence in conducting sale. 

(1) costs of the sale

(2) security interest foreclosed

(3) junion lienholders terminated by sale

(4) mortgagor

Second or later interests. 

Destroyed by foreclosure sale iff junior mortgagee is made defendant in judicial proceding and receives notice of the sale. 

at any time after default but before foreclosure, the mortgagor has the right to redeem the property bypaying the debt due. 

50% of states have fixed time period after foreclosure sal when mortgagor may redeem by matching foreclosure sale price. 

Mortgages: Priorities: Purchase-Money Mortgage: 

(1) Extension of mortgage maturity date

(2) rescheduling installment payments. 

Mortgagor transfers property subject to mortgage, mortgagee may foreclose if payments are not made, but buyer does not have personal liability. 

Transferee assumes the mortgage and payments are not made, mortgagee may foreclose. Buyer does have personal liability. 

Like a mortgage, but the legal title is transferred to a trustee who is close to the debtor. 

In event of default, a trustee is directed to proceed with foreclosure sale. 

Seller finance, but seller only delivers deed and legal title when payments have been completed. 

Default = forfeiture of all installments paid. 

Buyer gets grace period in many states, where seller gets possession of land during period. 

personal in nature. There is a servient estate but not a dominant estate. 

E.g., Power Company has the right to cross property with power lines. 

(1) Exrpess through writing (SOF)

(2) By Implication

(3) By Prescription

(4) By Estoppel

(1) Common ownership of land and severance of title 

(2) Existing, apparent, and continuous use when severence occurs (quasi-easement)

(3) Intent to continue use after division of land since use is rex necessary for enjoyment of dominant estate at time of severance. 

(1) Severence of title to land held in common ownership; and 

(2) strict necessity for easement at time of severence. 

Proof that the use of the property is: 

(a) open and notorious; 

(b) actual; 

(c) continuous for statutory period (20 years under CL)

(d) hostile; and

(e) exclusive (owner and user may share). 

Both benefit and burden may be transferred. 

Easement appurtenant follows transferred estate. 

Easements can be termianted by the following methods: 

(a) Lapse of express time in creation

(b) holder of dominent estate releases interest

(c) merger

(d) abandonment: proof of intent and affirmative action in furtherance of abandonment

(e) Estoppel: act or representation, justifiable reliance, detriment

(f) prescription

(g) eminent domain of servient estate

Non-possessory intrest in land. 

permits the right to take something from the land. 

Generally revocable at the will of the licensor. May become irrevocable iff: 

(a) coupled with an interest: interest is in personal property that is on the land of the licensor

(b) Executed License: based on estoppel, involves substantial expendature of funds in reliance on licensor's promise. 

(1) Embodied in writing that satisfies SOF

(2) Writing must include language that shows intent

(3) Privity: Horizontal--conveyance between covenantor and covenantee; required for both benefit and burden to run. Vertical--original party to running covenant and successor in interest. successor stepped into shoes of original praty. Burden running: only where servient estate transfers all interest. Benefit running: any interest transferred. 

(4) touch and concern: covenant must exercise direct influence on occupation, use, or enjoyment of premises. 

(5) Noticer

Court will enforce covenant as equitable servitude if: 

(a) P can establish elements of covenant that runs with the land, but P seeks equitale relief; or

(b) P cannot establish all elements for covenant that runs, but P can demonstrate relaxed requirements for equitable servitude. 

(1) No writing, P can show covenant through part performance or estoppel;

(2) P cannot show intent for covenant to run, can establish by showing common scheme--subdivision.

(3) No privity is required

(4) Still need touch and concern

(5) Notice depends on recording statute.