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PROPERTY I SLIDES

ACQUISITION

Johnson v. MIntosh Timeline

5 July 1773: William Murray and others, apparently including Thomas Johnson, Jr.,
purchased Parcel 1, located in what is now Illinois, for $24,000 from the Illinois tribe.
18 October 1775: Louis Viviat and others, including Thomas Johnson, Jr., purchased
Parcel 2, also located in what is now Illinois, for $31,000 from Chief Tabac acting for
the Piankeshaw tribe.
1776: The Revolutionary War prevented the grantees, who were mostly British
citizens, from taking possession of the parcels.
1781-1816: Murray, Viviat and their co-grantees repeatedly petitioned Congress
unsuccessfully for acknowledgement and confirmation of their ownership of Parcels
1 and 2.
1784: Virginia ceded to the United States its claim to the Northwest Territory, which
included Parcels 1 and 2.
20 July 1818: The U.S. government conveyed Parcels 1 and 2 to William MIntosh,
and MIntosh subsequently took possession of the parcels.

Johnson v. MIntosh Timeline


(continued)

1 October 1819: Thomas Johnson, Jr. died testate, with a will that
devised his interest in Parcels 1 and 2 to his son, Joshua Johnson,
and his grandson, Thomas Graham, as tenants in common.
Sometime after 1819: Joshua Johnson and Thomas Graham leased
their interest in Parcels 1 and 2 to a tenant.
The tenant of Joshua Johnson and Thomas Graham (citizens of
Maryland) brought a diversity action in the federal District Court for
Illinois seeking ejectment against MIntosh (a citizen of Illinois).
The trial court (District Court) rendered judgment for MIntosh.
The U.S. Supreme Court, in an opinion written by Chief Justice John
Marshall, affirmed the decision of the District Court.

Acquisition by Discovery

During the age of discovery (1450-1600), real property could be


acquired by discovery.
Discovery was based on the concept of first in time (among
Europeans) , first in right.
Discovery consisted sighting or finding territory previously unknown
or uncharted (by Europeans), often accompanied by a landing and a
symbolic taking of possession.

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Acquisition by Discovery

Discovery gave rise to an to an inchoate title, which had to be


perfected within a reasonable time.
Title could be perfected through
Conquest, which consisted of taking of enemy territory through
force,
Peaceful occupation, or
Purchase.
In acquisition by discovery, the property rights of native populations
were largely ignored.

Property I Slides

Accessions to Personal Property

Accession by Labor Only: When one person adds labor to an item of


personalty owned by another, ownership of the finished item is
awarded to the owner of the item, unless
The accessioners (laborers) efforts have
Completely transformed the nature of the item or
Sufficiently (substantially?) increased the value of the item,
and
The accessioner has not acted willfully.

Accessions to Personal Property

Accession by Labor and Addition of Another Item:


Ownership of the finished item is generally awarded to the owner
of the principal item,
Even if the accessioner acted willfully and wrongfully, unless
The attached item may be separated from the principal item
without harm.

Accessions to Personal Property

Damage Awards
If the final product is awarded to the accessioner or the owner elects to
sue in conversion rather than in replevin,
The owner of the principal item may receive damages in the amount
of the principal item that was transformed.
If the accessioner acted willfully, the value of the item is generally
determined at the time of the conversion, thus including any
increase in value caused by the accession.
If the accessioner acted innocently, most courts set damages by
deducting from the increased value at least the cost of improvement
incurred by the accessioner.
If the final product is awarded to the owner of the principal item,
generally, the accessioner may not recover damages for the labor
contributed.

Accessions - Sale of Improved Item

Generally, a person who lacks title to goods cannot pass title to


those goods, even to a bona fide purchaser.
Therefore, the true owner may maintain an action for conversion
against a person who innocently purchases from someone other
than the true owner.

Accessions - Sale of Improved Item

Amount of Award
In some jurisdictions, the true owner may recover in conversion
from the purchaser based on the value of the item at the time of
the purchase, even if the value of the item increased through
accession after the item was taken from the true owner, and
even if both the accessioner and the purchaser acted innocently.

Accessions - Sale of Improved Item

However, in other jurisdictions, the amount of the award


depends on whether the accessioner acted willfully:
If the accessioner acted innocently, and is not liable in the
jurisdiction for the increased value of the chattel, the innocent
purchaser from the accessioner may be held liable for the
original value only.
If the accessioner acted in bad faith,
Some courts hold the innocent purchaser liable for the
increased value.
Some courts hold the innocent purchaser liable for the
original value only.

Trespass and Trespass on the Case

Trespass
Trespass lay for injury to person or property,
When the injury was committed with force, actual or implied.
When the injury was immediate and not merely
consequential.
In the case of injury to property, when the property was in the
actual or constructive possession of the plaintiff at the time of
the injury.

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Trespass and Trespass on the Case

Modern Elements of Trespass to Chattels (De Bonis Asportatis) :


Intent
Interference with the possessory interest of another in
personalty,
Causation, and
Damages.
Modern Elements of Trespass to Land (Quare Clausum Fregit):
Intent,
Physical invasion of the land of another, and
Causation.

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Trespass and Trespass on the Case

Trespass on the Case


Trespass on the case lay for torts
Not committed by force, actual or implied, or
Committed by force when
The injury was not immediate but rather was
consequential,
The subject matter was intangible, or
The interest in the property affected did not give a right of
possession.

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Property Rights in Wild Animals

As a general principle, no one owns wild animals (ferae naturae) in their


natural habitat.
Capture:Title to a wild animal may be acquired through capture.
Capture may be accomplished by the following:
Killing: A person who kills a wild animal has possession over a
subsequent intervener.
Mortally Wounding: A person who mortal wounds a wild animal has
possession over a subsequent intervener.
Trapping or Netting: A person who traps or nets a wild animal has
constructive possession, which is superior to the rights of a
subsequent intervener.
Mere Pursuit: A person who is merely chasing a wild animal does not have
constructive possession, even if the chaser is in hot pursuit of the animal.

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Property Rights in Wild Animals

Ratione Soli
Under the traditional English rule of ratione soli, the owner of land
was considered to be in constructive possession of wild animals
on his land, with rights superior to a trespasser on the land.
The landowners ownership of the animal was accomplished
through the capture of the animal, whether by the landowner or
the trespasser.
American courts have, for the most part, rejected ratione soli.
Release or Escape After Capture (Animus Revertendi)
Ownership rights in a wild animal terminate when the animal is
released or escapes back to its natural liberty.
However, ownership rights in a wild animal continue after escape
or release if the animal has animus revertendi.

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Property Rights in Wild Animals

Natural Resources
The wild animal capture rules were initially applied to cases
involving nautral resources such as gas and oil.
However, serious depletion of natural resources has caused the
capture rule to be replaced by extensive federal and state
resource legislation.

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FINDERS

Rights of Finders of Personal Property

Finder: A finder is the first person to take possession of lost or


unclaimed tangible personal property.
Possession: Possession requires

Intent to control the property and


An act of control.

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Rights of Finders of Personal Property


Categories of Found Property:
Abandoned Property

Definition of Abandoned Property: Property is abandoned if the


owner intentionally and voluntarily relinquishes all right, title and
interest in the property.
The first person to take possession of abandoned property acquires
title that is good against the world, including the prior owner.

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Rights of Finders of Personal Property


Categories of Found Property: Lost Property

Definition of Lost Property: Personal property is lost if the owner


unintentionally and involuntarily parts possession with it.
Owner v. Finder: An owner of lost property retains rights superior
over a finder of the lost property.
Finder v. Owner of Locus in Quo

If lost property is found in a public location, the finder usually


prevails over all but the true owner.

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Rights of Finders of Personal Property


Categories of Found Property: Lost Property

Lost personal property found on private land


Status of Finder
The owner of the locus is quo is likely to win if the finder is a
trespasser.
The courts are split if the finder is an invitee or a licensee.
Some courts favor the invitee or licensee, who gains
rights superior to all but the true owner. (This position is
probably the American majority rule.)
Some courts favor the owner of the locus in quo, who
gains rights superior to all but the true owner. (This
position is probably the American minority rule but is the
favored rule in England).

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Rights of Finders of Personal Property


Categories of Found Property: Lost Property

Lost personal property found on private land (continued)


Embedded in Soil v. Lying on Surface
Some courts award ownership of lost personal property
to the owner of the locus in quo if the property is
embedded in the soil or found in a house.
Those courts award ownership of lost property to the
finder if the property is lying unattached on the surface of
the land.

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Rights of Finders of Personal Property

Mislaid Property
Personal property is mislaid if the owner voluntarily puts it in a certain
place with the intent to reclaim it but then fails to reclaim or forgets
where the property was left.
When property is mislaid, the owner of the locus in quo generally has
rights superior over the finder and all but the true owner.
Treasure Trove
Treasure trove encompasses gold, silver, currency or the like that, in
the distant past, was intentionally concealed by an unknown person
for safekeeping in a secret location.
In England, treasure trove belongs to the Crown.
In the United States, treasure trove belongs to the finder (or possibly
to the owner of the locus in quo if the finder is a trespasser).

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Rights of Finders of Personal Property

Employees, Agents and Persons Present for a Limited Purpose


If the finder is an employee of the owner of the locus in quo,
ownership is awarded to the landowner.
If the finder is an employee of someone other than the
owner of the locus in quo
Ownership of lost property is awarded to the employer.
Ownership of mislaid property is awarded to the owner of
the locus in quo.
If a person is on the premises for a limited purpose (e.g., a
mail carrier), ownership is usually awarded to the owner of
the locus in quo.

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Replevin

In a writ of replevin, the plaintiff sought return of personal property.


Traditional Elements of Replevin

The plaintiff had possession, or the immediate right to


possession, of personal property.
The defendant wrongfully took the plaintiffs property (replevin
in the cepit), or the defendant wrongfully detained the
plaintiffs property after the defendant lawfully took
possession of the property (replevin in the detinet).
Despite the plaintiffs request for return of the property, the
defendant wrongfully detained the property up to the time of
suit.
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Detinue sur Bailment and Detinue Sur


Trover

Detinue sur bailment and detinue sur trover were the antecedents of the
action for conversion.
In a writ of detinue (whether sur bailment or sur trover), the plaintiff sought
damages (measured by the value of the property) for the wrongful
conversion of personal property.
Traditional Elements of Detinue
The plaintiff had possession, or the immediate right to possession, of
personal property.
The plaintiff bailed that property to the defendant (detinue sur bailment),
or the plaintiff casually lost the property and the defendant found the
property.
Despite the plaintiffs request for return of the property, and despite the
defendants knowledge that the property belonged to the plaintiff, the
defendant wrongfully converted the property to his own use.

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ADVERSE POSSESSION

Adverse Possession

Adverse possession requires proof of possession that is


Open, Visible and Notorious,
Actual,
Exclusive,
Hostile and Under a Claim of Title or Right, and
Continuous for the Statutory Period.

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Adverse Possession
Actual

Constructive Adverse Possession:


Constructive adverse possession requires color of title and
actual possession of a significant part of the premises.
If those elements are satisfied, the possessor will constructively
possess the whole property, as described in deed.

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Adverse Possession
Actual

Exceptions to the rule constructive possession rule:


If land is divided into two or more distinctive lots, constructive
possession will extend only to the lot that the possessor
actually occupies.
If a third person is in possession of part of the premises,
constructive possession does not extent to the portion the
third party possesses.
Many courts require some reasonable relationship between
the area actually possessed and the additional area alleged to
be constructively possessed.

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Adverse Possession
Hostile and Under a Claim of Title or Right

Jurisdictional Approaches to Claim of Title or Right


Objective Standard (English and American Majority Rule): State
of mind is irrelevant.
Good Faith Standard (Minority American Rule): The claimant
must show that she believes the land is hers.
Aggressive Trespass (Bad Faith) Standard: The claimant must
show that she knows that the land is not hers but intends to
claim it nonetheless.

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Adverse Possession
Hostile and Under a Claim of Title or Right

Mistaken Boundaries
Objective Standard: Under the objective majority view for
mistaken boundaries, possession is hostile so long as the
possessor intends to claim the land as her own, even if the
possessor is unsure as to the location of the boundary.
Subjective Standard: Under the subjective minority view for
mistaken boundaries, the possessor must actually know that she
has crossed over the boundary.

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Adverse Possession
Hostile and Under a Claim of Title or Right

Other Methods for Resolving Boundary Disputes


Doctrine of Agreed Boundaries: An oral agreement to settle a
boundary dispute is enforceable if the parties subsequently
accept the line for a long period of time.
Doctrine of Acquiescence: Long acquiescence (perhaps for a
period shorter than the statute of limitations) is evidence of
an agreement between the parties to fix the boundary line.
Estoppel: If one party makes a representation (through
words or acts) to the other concerning the location of a
common boundary, and the other party changes position in
reliance on that representation, the first party may be
estopped from denying the validity of his representation.

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Adverse Possession
Continuous for the Statutory Period

Seasonal use (e.g., annual summer use of an unheated cabin in


the north woods) may suffice, if that use constitutes the best use of
the property.
Tacking is allowed if the adverse possessor and her successor or
the owner and his possessor are in privity of estate.

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Traditional Property Principle

Cujus est solum ejus est usque ad coelum et ad inferos.


He who owns the land also owns from the heavens to the center of
the earth.

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Adverse Possession in Florida


95.16. Adverse Possession Under Color of Title

Basic Requirements
The claim must be based on a properly filed written conveyance
of the property (or on a decree or judgment).
The claimant must show that for seven years he has been in
continued adverse possession of the property included in the
instrument, decree, or judgment.
If the property is divided into lots, the possession of one lot shall
not be deemed a possession of any other lot of the same tract.

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Adverse Possession in Florida


95.16. Adverse Possession Under Color of Title

Possession Defined: Under this section, property is deemed to be


possessed when
It has been usually cultivated or improved.
It has been protected by a substantial enclosure.
All land protected by the enclosure must be included within
the description of the property in the written instrument,
judgment, or decree.
If only a portion of the land protected by the enclosure is
included within the description of the property in the written
instrument, judgment, or decree, only that portion is deemed
possessed.

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Adverse Possession in Florida


95.16. Adverse Possession Under Color of Title

Although it has not been enclosed, it has been used for the
supply of fuel or fencing timber for husbandry or for the ordinary
use of the occupant.
A known lot or single farm has been partly improved, with the
part that has not been cleared or enclosed according to the
usual custom of the county to be considered as occupied for the
same length of time as the part improved or cultivated.

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Adverse Possession in Florida


95.16. Adverse Possession Without Color of Title

Basic Requirements

The claim is not based on a properly filed written conveyance


of the property (or on a decree or judgment).

The claimant must show that for seven years he has been in
continued adverse possession of the property.

The claimant must file a tax return within one year of entering
and must subsequently pay taxes on the subject property
throughout the adverse possession period.
Possession Defined: Under this section, property is deemed to be
possessed when

It has been protected by substantial enclosure.

It has been usually cultivated or improved.

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Color of Title and Constructive Adverse


Possession Problem 1 (text p. 130)
First Variation

Facts
O owns a 100-acre farm, which he has possessed since 1975.
In 1990, A entered the back 40 acres under color of an invalid
deed for the entire 100 acres, which was executed by Z (who
had no claim to the farm).
Since 1990, A has occupied and improved the back 40 acres.
A has occupied the back 40 acres for the period required by the
relevant statute of limitations.
A, claiming adverse possession, now sues to evict O from the
farm.

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Color of Title and Constructive Adverse


Possession Problem 1 (text p. 130)
First Variation (continued)

Analysis
O has record title to the farm.
O has prior actual possession of part of the farm.
Os record title to the whole farm, coupled with his actual
possession of part of the farm, gives O prior constructive
possession of the whole farm.
Because O has prior constructive possession of the whole farm, A
may claim adverse possession of only the 40 acres that A has
actually possessed for the statutory period.
Conclusion
The court will award A title to the 40 acres that A actually
possesses.
O will retain title to the remaining 60 acres, which O actually or
constructively possesses.

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Color of Title and Constructive Adverse


Possession Problem 1 (text p. 130)
Second Variation

Facts
In 1975, O took title to the 100-acre farm by an invalid deed.
O has possessed the farm since 1975, which is sufficient to
satisfy the relevant statute of limitations.
In 1990, A entered the back 40 acres under color of an invalid
deed for the entire 100 acres, which was executed by Z (who
had no claim to the farm).
Since 1990, A occupied and improved the back 40 acres of the
farm.
A has occupied the back 40 acres for the period required by the
relevant statute of limitations.
A, claiming adverse possession, now sues to evict O from the
farm.

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Color of Title and Constructive Adverse


Possession Problem 1 (text p. 130)
Second Variation (continued)

Analysis
Because O took title to the entire farm by an invalid deed, O has
color of title to the whole farm.
O also has prior actual possession of part of the farm.
Os color of title to the whole farm, coupled with his actual
possession of part of the farm, gives O prior constructive possession
of the whole farm.
Because O has prior constructive possession of the whole farm, A
may claim only the 40 acres that A has actually possessed for the
statutory period.
Conclusion
The court will award A title to the 40 acres that A actually possesses.
O will retain title to the remaining 60 acres, which O actually or
constructively possesses.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
First Variation

Facts
X and Y are the record owners of Lots 1 and 2, which are
contiguous.
Neither X nor Y is in possession of his lot.
By an invalid deed, Z conveyed Lots 1 and 2 to A.
A entered Lot 1 and has occupied that lot for the period required
by the relevant statute of limitations.
A now sues X and Y to quiet title to Lots 1 and 2.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
First Variation (continued)

Analysis
Through the invalid deed that she received from Z, A has color of
title to both lots.
A also has actual possession of Lot 1.
However, A has neither actual nor constructive possession of Lot
2.
Therefore, A may claim adverse possession of Lot 1 but not Lot
2.
Conclusion
The court will award A title to Lot 1.
Y will retain title to Lot 2.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
Second Variation

Facts
X and Y are the record owners of Lots 1 and 2, which are
contiguous.
Neither X nor Y is in possession of his lot.
X conveyed Lots 1 and 2 to A.
A entered Lot 1 and has occupied that lot for the period required
by the relevant statute of limitations.
A now sues X and Y to quiet title to Lots 1 and 2.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
Second Variation (continued)

Analysis
Through the valid deed to Lot 1 executed by X, A has record title to
Lot 1.
(A also has actual possession of Lot 1.)
Through the defective deed to Lot 2 executed by X, A has color of
title to Lot 2.
However, A has neither actual nor constructive possession of Lot 2.
Therefore, A may claim title to Lot 1 but not to Lot 2.
Conclusion
The court will award A title to Lot 1.
Y will retain title to Lot 2.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
Third Variation

Facts
X and Y are the record owners of Lots 1 and 2, which are
contiguous.
Neither X nor Y is in possession of his lot.
X conveyed Lots 1 and 2 to A.
A entered both lots and occupied the lots for the period required
by the relevant statute of limitations.
A now sues X and Y to quiet title to Lots 1 and 2.

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Color of Title and Constructive Adverse


Possession Problem 2 (text p. 130)
Third Variation (continued)

Analysis
Through the deed to Lot 1 executed by X, A has record title to
Lot 1.
(A also has possession of Lot 1.)
Through the defective deed to Lot 2 executed by X, A has color
of title to Lot 2.
A also has actual possession of Lot 2.
Because A has record title to Lot 1 and has adversely possessed
Lot 2 for the statutory period, A may claim title to both lots.
Conclusion: The court will award A title to Lots 1 and 2.

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Adverse Possession
Tolling of the Statute of Limitations for Disabilities

For tolling to occur, a disability must be in existence at the time


the adverse possessor enters.
"Disability" typically includes nonage, legal incompetency, and
imprisonment.
Most states extend the time to bring an action to a certain
period after the disability has been removed (e.g., ten years).
If the owner has two or more disabilities, the owner may take
advantage of the longest.

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Tolling in Florida
95.051. When Limitations Tolled

The running of the time under the statute of limitations is tolled by:
Incapacity

The adjudicated incapacity, before the cause of action accrued, of the


person entitled to sue.

In any event, the action must be begun within 7 years after the act, event,
or occurrence giving rise to the cause of action.
Minority

The minority of the person entitled to sue during any period of time in which
a parent, guardian, or guardian ad litem does not exist, has an interest
adverse to the minor or incapacitated person, or is adjudicated to be
incapacitated to sue.

In any event, the action must be begun within 7 years after the act, event,
or occurrence giving rise to the cause of action.

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Tolling in Florida
95.051. When Limitations Tolled

Absence from the state of the person to be sued.


Use by the person to be sued of a false name that is unknown
to the person entitled to sue so that process cannot be served
on the person to be sued.
Concealment in the state of the person to be sued so that
process cannot be served on him or her.
Voluntary payments by the alleged father of the child in
paternity actions during the time of the payments.
The payment of any part of the principal or interest of any
obligation or liability founded on a written instrument.
The pendency of any arbitral proceeding pertaining to a dispute
that is the subject of the action.

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Tolling Problems
Problem 1(a) (Text p. 143)

Facts
In 1980, A entered adversely on land owned by O.
O was insane in 1980.
O died insane and intestate in 2003, and
O's heir H was under no disability in 2003.
Issue: When will A gain title by adverse possession?

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Tolling Problems
Problem 1(a) (continued)

Analysis
Under the statute quoted, if the owner is under a disability at the
time the adverse possessor enters,
The Statute of Limitations is tolled, and
The owner must bring suit
Within the limitation period (21 years) or
Within ten years after the disability is removed,
Whichever is longer.

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Tolling Problems
Problem 1(a) (continued)
Case at Bar
Limitation Period
Under the governing statute, the limitation period is twenty-one
years.
Thus, in the absence of tolling, the statute would run out in 2001
(1980 plus 21 years = 2001).
Tolling Period
Under the governing statute, the owner is given ten years after the
removal of his disability.
O's disability was removed in 2003.
Thus, under the tolling provision, O must bring suit by 2013 (1999
plus ten years = 2013).
Whichever is Longer: Os heir must bring suit by 2013, which is the
later of the two dates discussed above.
Conclusion: If Os heir does not sue by 2013, A will gain title by adverse
possession in 2013.

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Tolling Problems
Problem 1(b) (Text p. 143)

Facts
O was insane in 1980.
O died insane and intestate in 2003.
O's heir H was six years old in 2003.
Issue: When will A gain title by adverse possession?

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Tolling Problems
Problem 1(b) (continued)

Analysis
Under the statute quoted, if the owner is under a disability at the
time the adverse possessor enters,
The Statute of Limitations is tolled, and
The owner must bring suit
Within the limitation period (21 years) or
Within ten years after the disability is removed,
Whichever is longer.
Case at Bar: As discussed above, Os estate would have been
required to bring suit by 2013, which is ten years after Os
disability was removed by his death in 2003.

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Tolling Problems
Problem 1(b) (continued)
Disability of Os Heir
Disabilities may not be tacked.
Hence, the nonage of Os heir must be disregarded.
Therefore, Os heir must bring suit by 2013, which is 10 years
after the removal of Os disability.
Conclusion: If Os heir does not sue by 2013, A will gain title by
adverse possession in 2013.

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Tacking Problems
Problem
2
(text
p.
142)
Facts

In 1990, A entered adversely on Blackacre, owned by


O.
In 1991, O died, leaving a will that devised Blackacre
to B for life, remainder to C.
B died in 2006, without ever having entered on
Blackacre.
Issue: Who owns Blackacre?

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Tacking Problems
Problem 2 (continued)

Analysis
If an adverse possessor enters against a fee owner, the
Statute of Limitations continues to run against third persons
who subsequently take by inter vivos or post mortem transfer
from the owner (because the third persons have taken the
land already subject to the adverse possession).
A entered against O before O devised to B for life, remainder
to C.
Therefore, the statute of limitations continued to run against
both B and C.
Conclusion
A wins.
(C's only hope is to force B to oust A).

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Tacking Problems
Problem
3 (text p. 142)
Facts

O, the owner of Blackacre, died in 1991, devising Blackacre to B


for life, remainder to C.
In 1992, A entered adversely.
B died in 2006.
Issue: Who owns Blackacre?
Analysis
If an adverse possessor enters against a life tenant,
The Statute of Limitations continues to run against the life tenant.
However, the Statute of Limitations does not begin to run against
the remainderman until the life tenant dies (because the
remainderman does not have a right to possession until the life
tenant dies).

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Tacking Problems
Problem 3 (continued)
Instant Case
The Statute of Limitations started to run against B in
1992, when A entered the premises.
However, it did not start to run against C until B died in
2006.
Therefore, the Statute of limitations has not yet run out
against C.
Conclusion: C wins.

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GIFTS

Elements of an Inter Vivos Gift

An inter vivos gift requires

Present donative intent,


Delivery

Actual or
Constructive, and
Acceptance (which is presumed).

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66

Elements of a Gift Causa Mortis

A gift causa mortis is a gift made by a donor in contemplation of the donors


(imminent) death.
A gift causa mortis requires proof of the traditional elements for an inter vivos
gift:
Present donative intent,
Delivery, and
Acceptance.
A gift causa mortis is revocable.
At any time during her lifetime, the donor may revoke a gift causa mortis.
A gift causa mortis is revoked by operation of law if the donor does not
die from the peril anticipated by the donor (determinable event or
condition subsequent).

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67

Gift Problem #1
Text p. 158

Facts
O owns a pearl ring.
While visiting her daughter A, O leaves the ring on the
bathroom sink.
After O leaves, A discovers the ring.
When A telephones O to tell her of the discovery, O tells A
to keep the ring as a gift.

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68

Gift Problem #1, First Question


Text p. 158

Issue: Has O made a gift to A?


Analysis:
A gift requires

Present donative intent,


Delivery, and
Acceptance.

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69

Gift Problem #1, First Question


Text p. 158

Present Donative Intent:

A donor must have present donative intent.


O told A to keep the ring as a gift.
Therefore, O had present donative intent.

Delivery

For an inter vivos gift, the delivery requirement has been


satisfied if, on discovering possession of an item of
personalty in a third person, the owner voluntarily leaves
possession with the third person.
On discovering that the ring had been left on her daughters
sink, O voluntarily left the ring with the daughter, saying that
she wanted her daughter to keep the ring as a gift.
Therefore, the ring was delivered to the daughter.

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70

Gift Problem #1, First Question


Text p. 158

Acceptance

Absent evidence to the contrary, acceptance is presumed.


There is no evidence indicating that O did not intend to give the
ring to A.
Therefore, the acceptance requirement has been satisfied.

Conclusion: O made a gift of the ring to A because


O intended to give the ring to A when O told A to keep the ring
as a gift,
O delivered the ring to A by leaving it in As possession, and
There is no evidence to rebut the presumption that A accepted
the gift.

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71

Gift Problem #1, Second Question


Text p. 158

Issue: If O has made a gift to A, may O change her mind the


next day and require A to return the ring?
Analysis
Once made, a gift is irrevocable.
As discussed above, O gave the ring to A.
Therefore, the gift to O is irrevocable.
Conclusion: O may not require A to return the ring.

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72

ESTATES

FEUDAL CHAIN
King

Military
Tenant*

Tenant
In Chief*

Tenant In Chief
Tenant
Tenant
(Civil -Grand
In Chief* In Chief*

(Military)

(Military)

Socage
Tenant*

Military
Tenant*

Socage Socage Socage Socage


Tenant Tenant Tenant Tenant

(Military)

Church
(Frankalmoign)

Serjeantry)

Socage
Tenant*

Tenant
In Chief
(Civil - Petty
Serjeantry)

Socage Socage Socage Socage Socage


Tenant Tenant Tenant Tenant Tenant

Peasants Peasants Peasants Peasants Peasants Peasants Peasants Peasants Peasants


* Mesne Lord

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74

FEUDAL CHAIN (continued)


Subinfeudation

Substitution
(authorized in 1290 by
the statute Quia Emptores)

Lord

Lord

Tenant
(Mesne Lord)

Tenant #1

Tenant #2

Sub-Tenant

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75

General Warranty Deed


Premises,
including
granting clause,
recitation of
Consideration,
and description
of land

Habendum
clause

I, John Doe, grant to Nancy Roe and her heirs and


assigns forever, for $10 and other good and valuable
consideration, the following real estate situated in
__________County, State of __________described as
follows:
[Insert description of land]

To have and to hold the premises, with all the


privileges and appurtenances belonging hereunto, to
the use of the grantee and her heirs and assigns
forever.
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76

General Warranty Deed

Warranties of
title

The grantor, for himself and his heirs and assigns, covenants (1)
that the grantor is lawfully seized in fee simple of the premises, (2)
that he has a good right to convey the fee simple, (3) that the
premises are free from all encumbrances, (4) that the grantor and
his heirs and assigns will forever warrant and defend the grantee
and her heirs and assigns against every person lawfully claiming
the premises or any part thereof, (5) that the grantor and his heirs
and assigns will guarantee the quiet enjoyment of the premises to
the grantee and her heirs and assigns, and (6) that the grantor
and his heirs and assigns will, on demand of the grantee or her
heirs or assigns, execute any instrument necessary for the further
assurance of the title to the premises that may be reasonably
required.
Dated this day of , 20 _.
John Doe [signature of grantor]

Execution

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77

General Warranty Deed


State of ____________
County of __________

Acknowledgement

I hereby certify that on this day before me, a notary public,


personally appeared the above named John Doe, who
acknowledges that he voluntarily signed the foregoing
instrument on the day and year therein mentioned.
In testimony whereof, I hereunto subscribe my name and affix
my official seal on this day of , 20 _.

Jane Roe [signature of notary]


Notary Public in and for__________County,
State of __________
My commission expires __________

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78

TABLE OF CONSANGUINITY PARENTELIC SCHEME


Grandparents

Parents

Aunts
Uncles

Deceased

Brothers
Sisters

First
Cousins

Children

Nephews
Nieces

First Cousins
Once Removed

Grandchildre
n

Grand
Nephews
Nieces

First Cousins
Twice Removed

GreatGrandchildren

Great-Grand
Nephews
Nieces

First Cousins
Thrice Removed

Property I Slides

79

FREEHOLD ESTATES
Fee Simple Absolute

Definition: A fee simple absolute is the largest possible


estate in land, denoting the aggregate of all possible
rights that a person may have in that parcel of land.
OA
and her heirs.
words of purchase
words of limitation

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80

Words of Purchase v. Words of


Limitation

Words of purchase describe the persons (called purchasers) who


take an interest under a grant or devise.
Words of limitation describe the nature of the estate taken by the
purchasers.
Example #1: O conveys to A and her heirs.
Words of Purchase: The words to A are words of purchase, because
they indicate that A takes an interest under the grant from O.
Words of Limitation: The words and her heirs are words of limitation,
because they describe the nature of the estate taken by A (which is a
fee simple absolute).
As heirs take nothing under this grant.

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81

Words of Purchase v. Words of Limitation

Example #2: T devises to A for life, remainder to B and his heirs.


Words of Purchase
The words to A are words of purchase, because they indicate that A
takes an interest (present possessory interest) from T in this devise.
The words to B are also words of purchase, because they indicate
that B takes an interest (future interest) from T in this devise.
Words of Limitation
The words for life are words of limitation, because they describe the
nature of the estate taken by A (life estate).
The words and his heirs are words of limitation, because they
describe the nature of the estate taken by B (fee simple absolute).
Bs heirs take no interest under this devise.

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82

Words of Purchase v. Words of Limitation

Example #3: T devises to A for life, remainder to the heirs of B in fee


simple absolute.
Words of Purchase
The words to A are words of purchase, because they indicate that A
takes an interest (present possessory interest) from T in this devise.
The words to the heirs of B are also words of purchase, because they
indicate that Bs heirs takes an interest (future interest) from T in this
devise.
Words of Limitation
The words for life are words of limitation, because they describe the
nature of the estate taken by A (life estate).
The words in fee simple absolute are words of limitation, because
they describe the nature of the estate taken by Bs heirs.
B take no interest under this devise.

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83

FREEHOLD ESTATES
Fee Tail

O A and the heirs [male] [female] of his body.


At Strict Common Law

A has a fee tail general (or fee tail male or fee tail female,
or fee tail special, if limited to heirs of a specific spouse),
which may descend only to As lineal descendants.
O has a reversion, which falls in if and when A's lineal line
fails.
Modern Statutory Rules
In some states, A has a life estate, with a remainder per
stirpes in As lineal descendants in being at the time of
the life tenants death. See , e . g., F.S.A. 689.14.
In other states, A has a fee simple conditional.
In other states A gets a fee simple absolute.

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84

FREEHOLD ESTATES
Fee Tail Problem #3 (text p. 220)

Facts

O conveys Blackacre to A and the heirs of her body.


A then dies leaving her only child B as her only heir.
B then dies without having had children and devising all her
property to C.

Issue: What is the state of the title?

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85

FREEHOLD ESTATES
Fee Tail Problem #3 (text p. 220)

Analysis in Massachusetts (traditional fee tail)


O's conveyance creates a fee tail general in A, with a reversion in O.
On As death, the fee tail descends to her child, B.
When B dies without issue, the fee tail ends and title reverts to O in fee
simple absolute.
To devise Blackacre to C, B must disentail during his life (which now can
be done through the use of a straw).

Analysis in Florida
Os conveyance creates a life estate in A, with a remainder (in fee simple
absolute) in B, who is As lineal descendant being at the time of As
death.
Because B has a remainder in fee simple absolute, when B dies, C takes
a fee simple absolute through the devise in Bs will.

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86

FREEHOLD ESTATES
Life Estate

Life Estate: O to A for life.


Life Estate Pur Autre Vie: O to A for the life of B.
If B predeceases A, As estate ends at Bs death.
If A predeceases B, under the modern rule, As heirs take until B
dies.

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87

FREEHOLD ESTATES
Life Estate - Waste

Voluntary or Affirmative Waste

Voluntary waste consists of the voluntary commission of an act


that has more than a trivial injurious effect on or change in the
property.
Despite the prohibition on voluntary waste, natural resources
may be consumed
For the repair and maintenance of the property,
With permission, and
Under the open mines doctrine (which involves prior
exploitation, and which applies to both life tenants and
tenants for years).

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88

FREEHOLD ESTATES
Life Estate - Waste

Permissive or Involuntary Waste

Involuntary waste occurs if the life tenant or leasehold


tenant permits the premises to fall into disrepair.
Involuntary waste may also occur if the life tenant fails
to pay mortgage interest payments, taxes, or the
tenants share of special assessments.
A life tenant is responsible for permissive waste only
to the extent of
Rents and profits derived from third persons, or
The reasonable rental value of the property if the
life tenant remains in possession.
There is no like limitation on the responsibility of a
lessee for permissive waste.

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89

FREEHOLD ESTATES
Life Estate - Waste (continued)

Ameliorative (or meliorative, ameliorating, or meliorating)


Waste: Ameliorative by a life tenant (or possibly by a tenant
for a substantial term of years) is now allowed if

It is permissive,
The market value of the remaindermans interest is not impaired,
or
A substantial and permanent change in the neighborhood has
deprived the property of a reasonable current value.

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90

Economic Waste
as defined in Restatement (2d) of Contracts 348 comment c

Sometimes such a large part of the cost to remedy the defects [in
construction] consists of the cost to undo what has been improperly
done that the cost to remedy the defects will be clearly
disproportionate to the probable loss in value to the injured party.
Damages based on the cost to remedy the defects would then give
the injured party a recovery greatly in excess of the loss in value to
him and result in a substantial windfall. Such an award will not be
made.

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91

FREEHOLD ESTATES
Defeasible Fees and Other Defeasible
Estates

Fee Simple Determinable: O conveys to A and his heirs for so long


as (or during, while, or until) liquor is not served on the premises.
Fee Simple Subject to Condition Subsequent: O conveys to A and
his heirs, but if (or provided however, however if, on condition that)
liquor is served on the premises, then O has the right to reenter the
premises and terminate As estate.
Life Estate Determinable: O conveys to A for life for so long as the
premises are used for educational purposes.
Life Estate Subject to a Condition Subsequent: O conveys to A for
life, provided, however, that if the premises are not used for
educational purposes, O may reenter and retake the premises.

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92

FREEHOLD ESTATES
Defeasible Estates
Rules of Construction/Preference

A covenant is preferred over a defeasible estate, because the award


is money damages rather than forfeiture.
A fee simple subject to a condition subsequent is preferred over a
fee simple determinable, because in the former forfeiture is not
automatic.

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93

NONFREEHOLD ESTATES
Term of Years
(and Other Leasehold Interests)

The duration of an estate for years is absolutely computable (e.g., in


months or years) from the time of its creation.
O A for 20 years.
A receives a term for 20 years.
O retains a reversion.

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94

Restraints on Alienation

Disabling
Under a disabling restraint, A may not convey.
Disabling restraints are always void.
Forfeiture
Under a forfeiture restraint, A loses her estate if she attempts
to convey.
Forfeiture restraints are valid for life estates and future
interests, but they are not enforceable for fee simple estates.
Promissory
Under a promissory restraint, A promises not to convey.
Promissory restraints are valid for life estates and future
interests, but they are not enforceable for fee simple estates.

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95

Restraints on Alienation

Modern Approach to Restraints: Some courts now determine


the validity of restraints by measuring them in terms of
Their duration,
The type of alienation precluded and
The size of the class precluded from taking.
Partial Restraints: Partial restraints may be enforced, with the
court weighing purpose, effect and duration.

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96

FUTURE INTERESTS

REVERSIONARY INTERESTS
Reversions

Definition: A reversion is a future interest retained by the grantor


when the grantor transfers less than a fee interest to a third person.
Transferability: A reversion is transferable, devisable, and
descendible (majority and Florida rule).
Rule Against Perpetuities: A reversion is not subject to RAP.
O A for life, then to B for life, then to C for life.
The entire fee simple absolute is not accounted for in this
transaction.
Therefore, following all of these life estates, O has a reversion.

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98

REVERSIONARY INTERESTS
Reversions

O A for a term of ten years.


A has a term of ten years (leasehold interest).
O retains a reversion.
O A for life.
O retains a reversion.
Then O her reversion to C.
Cs interest is still defined as a reversion, even though it is
now in a third party.

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99

REVERSIONARY INTERESTS
Reversions

T Blackacre to A for life.


Ts will does not include a residuary clause.
When T dies
A gets a present possessory life estate.
Ts reversion passes to Ts heirs by the laws of intestacy.

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100

REVERSIONARY INTERESTS
Reversions

T Blackacre to A for life.


Also T the rest and residue of my estate to B.
When T dies
A gets a present possessory life estate.
B gets the residue of Ts estate, which includes the reversion to
Blackacre.

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101

REVERSIONARY INTERESTS
Possibilities of Reverter

Definition: A possibility of reverter is a future interest in the grantor that


follows a fee simple (or a life estate) determinable.
Transferability
At strict common law, a possibility of reverter could descend through
intestacy but could not be devised or transferred inter vivos (the rule in
Mahrenholz v. County Board of School Trustees).
Under the modern trend, a possibility of reverter is transferable,
devisable, and descendible (majority and Florida rule).
Statute of Limitations: The Statute of Limitations begins to run on a
possibility of reverter as soon as the limitation occurs (because the property
automatically reverts to the grantor on the occurrence of the limitation).
Rule Against Perpetuities: A possibility of reverter is not subject to RAP.

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102

REVERSIONARY INTERESTS
Possibilities of Reverter

O A and her heirs for so long as liquor is not served on


the premises.
A has a fee simple determinable, and O has a possibility of
reverter, which falls in automatically if liquor is served.
The O her possibility of reverter to C: Cs interest is still
defined as a possibility of reverter, even though it is now in a
third party.

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103

REVERSIONARY INTERESTS
Rights of Reentry (Powers of
Termination)

Definition: A right of reentry is a future interest in the grantor that follows a fee
simple (or a life estate) subject to a condition subsequent.
Transferability
Strict Common Law: A right of reentry could descend through intestacy but
could not be devised or transferred inter vivos (the rule in Mahrenholz v.
County Board of School Trustees).
Florida Rule: A right of reentry is transferable, devisable, and descendible.
Majority Rule: Rights of reentry are descendible, devisable in some states,
but not transferable inter vivos.
Statute of Limitations
Theoretically, the Statute of Limitations does not begin to run against a
right of reentry until the grantor attempts to exercise the right.
However, in some states, the Statute of Limitations begins to run against a
right of reentry when the condition occurs.
Rule Against Perpetuities: A right of reentry is not subject to RAP.

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104

REVERSIONARY INTERESTS
Rights of Reentry (Powers of
Termination)

O A and his heirs, but if liquor is served on the premises, then


O or his heirs may reenter and terminate As estate.
A has a fee simple subject to a condition subsequent, and O has
a right of reentry.
If liquor is served, O must take affirmative steps before As estate
is terminated.
If O fails to reserve expressly a right of reentry, if and when liquor
is served, O may be powerless to reclaim the property.
Then O her right of reentry to C (in a jurisdiction that permits
inter vivos transfers of rights of reentry): Cs interest is still defined
as a right of reentry, even though it is now in a third party.

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105

REVERSIONARY INTERESTS
Right of Reentry (Power of Termination)
O conveys to A; provided, however, that liquor may not be
served on the premises.
No right of re-entry has been reserved.
Therefore, O cannot take the property back if liquor is served on
the premises.
The condition subsequent language will be stricken.

A is left with a fee simple absolute.

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106

REMAINDERS
Vested Remainders

Definition: A remainder is a future interest created in and that remains


away from the grantor in a third person.
Requirements
A vested remainder requires its takers to be ascertained or
ascertainable at the time that the remainder is created.
A vested remainder also must fall in automatically at the natural
termination of the previous estate (that is, there are no conditions
precedent to taking).
Transferability: A vested remainder is transferable, descendible, and
devisable.
RAP
A fully vested remainder is not subject to RAP.
However, a remainder that is vested subject to open is subject to RAP.

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107

REMAINDERS
Vested Remainders

T A for life, remainder to B and his heirs.


A has a life estate.
B has a vested remainder in fee simple, because
The taker is identified, and
Bs interest falls in automatically at the natural termination of
the previous estate (when A dies).
O A for life, remainder to B for life, remainder to C and her
heirs.
A has a life estate.
B has a vested remainder for life .
C has a vested remainder in fee simple.

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108

REMAINDERS
Vested Remainders

Vested Remainder Subject To Open (sometimes called vested subject to


partial divestment): T A for life, remainder to As children and their
heirs.
Assume that, at the time of creation (Ts death), A is living and has one
child, B.
A has a present possessory life estate.
B has a vested remainder subject to open, because A could have
more children.
In that case T retains nothing.
Assume further that, one year later, a second child, C, is born to A.
A has a life estate.
B and C together have a vested remainder subject to open.
Again, T retains nothing.
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109

REMAINDERS
Vested Remainders

Vested Remainder Subject to Total Divestment: O A for life,


remainder to B for so long as the premises are used for
educational purposes.
A has a life estate.
B has a vested remainder subject to total divestment.
O retains a possibility of reverter.

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110

REMAINDERS
Contingent Remainders

Definition: A remainder is a future interest that is created in and that


remains away from the grantor in a third person.
Requirements: A remainder will be contingent if
The takers are unascertained, or
The interest is subject to a condition precedent and therefore does
not fall in automatically on the natural termination of the previous
estate.
Transferability
At strict common law, a contingent remainder could descend and
be devised but could not be transferred inter vivos.
Under modern law, a contingent remainder is transferable,
descendible, and devisable (except, possibly, when the contingent
remainder is in an unascertained person).
Rule Against Perpetuities: A contingent remainder is subject to RAP.

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111

REMAINDERS
Contingent Remainders
Unascertained Takers: T to A for life, remainder to As widow
and her heirs.
If, at the time of creation, A is living, whether married or
unmarried, A has a life estate and As widow has a
contingent remainder in fee simple, because the taker is not
yet ascertained or ascertainable.
Therefore, Ts estate retains a reversion.

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112

REMAINDERS
Contingent Remainders

Condition Precedent to Taking: O to A for life, remainder to B


and her heirs if B reaches 21.
If B is Already 21: If, at the time of creation, B is already 21, A
has a life estate and B has a vested remainder in fee simple.
If B is Not Yet 21
If, at the time of creation, B is not yet 21, A has a life estate
and Bs remainder is contingent, because B has not yet
fulfilled the condition precedent, which is B reaching 21.
Therefore, O retains a reversion.

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113

Rule in Purefoy v. Rogers (1670)

Rule: If a future interest is so created that it may in some case fall in


automatically at the natural termination of the previous estate, it will
be treated for all purposes as a contingent remainder.
O conveys to A for life, remainder to B and his heirs if B
reaches 21.
A has a life estate.
If B is not yet 21 at the time of creation, B may not be ready to
take when A dies.
However, B could possibly turn 21 before A dies.
Therefore, under the rule in Purefoy v. Rogers, Bs interest is
treated as a contingent remainder rather than an executory
interest (and thus may be destroyed in states in which
contingent remainders are still destructible).

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114

Rule in Purefoy v. Rogers (1670)

Rule of Law: The rule in Purefoy v. Rogers is a rule of law, which


creates an irrebuttable presumption.
Modern Importance
The rule in Purefoy v. Rogers is not very important in those
states in which contingent remainders are not destructible.
However, the rule still must be consulted in jurisdictions such as
Florida that have retained the destructibility of contingent
remainders.

Property I Slides

115

Destructibility of Contingent Remainders


Methods

A contingent remainder is destructible at common law if


It is not vested by the natural termination of the previous supporting
estate, or
Merger occurs:
When one party who possesses a present or future interest in the
subject realty by subsequent transactions obtains all outstanding
present and vested estates in that property:
By surrender of the present estate to the owner of a future
estate or
By release of a future estate to the owner of a present estate.
When all holders of present and future vested interests convey
all of these interests to a third party.

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116

Destructibility of Contingent Remainders


Failure at Natural Termination of Prior Vested
Estate

O A for life, remainder to B and her heirs if B reaches 21.


Interests Created
A has a life estate.
If B is not yet 21, B has a contingent remainder (contingent
on B reaching 21).
O retains a reversion.
Assume that A dies and B is not yet 21.
Bs contingent remainder cannot fall in naturally at the
termination of A's life estate, because B has not yet met the
condition precedent to vesting (reaching the age of 21).
B's contingent remainder is destroyed.
Therefore, Os reversion will fall in.

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117

Destructibility of Contingent Remainders


Merger

O A for life, remainder to B if B earns a law degree.


Interests Created
A has a life estate.
If B has not yet earned a law degree, B has a contingent
remainder in fee simple absolute.
O retains a reversion.
Assume that, one year later, O conveys her reversion to A and B still
has not earned a law degree.
A now has both a life estate and a reversion.
At common law, As two interests merge, because they are not
separated by a vested estate.

A gets a fee simple absolute.

B's contingent remainder is destroyed.

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118

Destructibility of Contingent Remainders


Merger (continued)

O A for life, remainder to Bs first born daughter.


Interests Created
A has a life estate.
If B does not yet have a daughter, Bs unborn daughter has a
contingent remainder.
O retains a reversion.
Assume that O later devises his reversion to A and that B still does not
have a daughter at the time of Os death.
At Os death, A receives Os reversion.
A also has her life estate.
As two interests merge, because they are not separated by a vested
estate.
A gets a fee simple absolute.
B's first born daughters contingent remainder is destroyed.

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119

Destructibility of Contingent Remainders


Merger (continued)

T A for life, remainder to Bs widower.

Assume that Ts will creates this devise but does not expressly dispose
of the reversion; however Ts will leaves the residue of Ts estate to A.
Assume further that, at the time the will takes effect (when T dies), B is
alive and married.

At Ts death, A has a life estate and a reversion.


Bs widower has a contingent remainder (because a person cannot have
a widow or widower until he or she dies).
B's widows contingent remainder is not destroyed by merger, because
A's interests were created at the same time and by the same instrument.

Assume that, one year after T dies, A conveys her life estate and the
reversion to C.

C gets a life estate and a reversion.


The life estate and the reversion merge.

C gets a fee simple absolute.


B's widowers contingent remainder is destroyed.

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120

EXECUTORY INTERESTS

Definition: An executory interest is a future interest in a third


person.
Requirements: An executory interest cannot fall in automatically
at the natural termination of the previous estate, because
It cuts off the previous estate (shifting executory interest), or
It does not become presently possessory until some time
after the natural termination of the previous estate (springing
executory interest).
Transferability: An executory interest is transferable, descendible,
and devisable.
RAP: An executory interest is subject to RAP.

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121

EXECUTORY INTERESTS
Shifting Executory Interests

O A, but if liquor is served on the premises then to B


and her heirs.
A has a fee simple subject to a condition subsequent
(executory limitation).
B has shifting executory interest, because his interest
may cut short As estate.

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122

EXECUTORY INTERESTS
Springing Executory Interest

O A for life, remainder to B and her heirs one


month after As death.

A has a life estate.

B has a springing executory interest, because her


interest cannot become presently possessory until one
month after the natural termination of As life estate.

O retains a reversion.

After As death, Os reversion falls in and then, one


month after As death, the fee simple springs out of O to
B.

Property I Slides

123

TRUSTS

The essence of a trust is a split between the legal and


equitable interests in property.
The settlor (S) conveys property to a trustee (Tee) to hold
in trust for certain named beneficiaries.
S Whiteacre to Tee in trust to pay the income to A for life
and then to distribute the principal to B and her heirs.
Tee has the legal fee simple absolute.
A has an equitable life estate.
B has an equitable vested remainder.

Property I Slides

124

Rule in Shelleys Case (1581)

O to A for life, remainder to the heirs of A.


Requirements
A must get a freehold estate (a life estate or a fee tail).
As heirs must get a remainder in fee (or in tail).
The same instrument must create both As and As heirs
interests.
Both estates must be legal or both must be equitable.

Property I Slides

125

Rule in Shelleys Case (1581)

Effect: If all of these requirements are met,


A gets both a life estate and a remainder, and
By merger A gets a fee simple (and thus As heirs take nothing
on their own).
Rule of Law: The Rule in Shelleys Case is a rule of law, which the
court must treat as creating an irrebuttable presumption.
Abolition of Rule: The Rule in Shelleys Case has been abolished by
statute or judicial decision in most states. See, e.g., F.S.A 689.17.

Property I Slides

126

Doctrine of Worthier Title

O A for life, remainder to the heirs of O.


Requirements
A must get some kind of estate less than a fee simple (the estate need
not be freehold).
Os heirs are given a remainder (or an executory interest, in the rare
case).
Both interests must be created by the same instrument.
Both interests must be legal or both must be equitable.
Applicability:
Under modern law, the Doctrine of Worthier Title applies to inter vivos
transfers only (the testamentary branch of the doctrine no longer is
applied).
Florida has abolished the Doctrine of Worthier Title, effective 1 July
2007. F.S.S. 689.175.

Property I Slides

127

Doctrine of Worthier Title

Rule of Construction: The Doctrine of Worthier Title is a rule of


construction, not law.
The remainder in Os heirs creates a rebuttable
presumption that O intended to retain that interest as a
reversion.
This presumption may be rebutted by clear express
evidence that O did intend to create a remainder in his
heirs.
If the presumption is raised, but it is not rebutted, A gets a
life estate and O retains a reversion (and thus Os heirs
take nothing on their own).

Property I Slides

128

Rule of Convenience

Basic Rule: Under the Rule of Convenience, a class closes when a


member of the class is entitled to distribution.
Classes to Which the Rule of Convenience Applies: The Rule of
Convenience applies to the following classes: "children,"
"grandchildren," "brothers," "sisters," "nephews," "nieces," "cousins,"
"issue," "descendants" or "family" of a designated person.

Property I Slides

129

Rule of Convenience

Immediate Gift to a Class (With No Condition Precedent)


If the class is already closed at the time the gift takes effect (time
of conveyance for an inter vivos gift or time of testators death for
a will), all members of the class will take.
If, at the time the gift takes effect, the class has members entitled
to take immediately but the class has not previously closed,
All members of the class conceived at the time the gift is
made will be included and may take.
However, the class will close to the exclusion of after-born
children, who may not take.
If the class has no members at the time the gift is made, all
members of the class, whenever born, will be included and may
take.

Property I Slides

130

Rule of Convenience
T the children of A

Example of Immediate Gift to a Class (With No Condition Precedent):


T the children of A.
If A Is Dead at the Time the Gift Takes Effect
If A is dead at the time of Ts death, the class of As children
will be closed.
Therefore, all of As children will be included and will take.
If A Is Alive at the Time of Ts Death and Has Children at That Time
The children born at the time of Ts death are entitled to
immediate distribution.
Therefore, the class will close, and all of those children will be
included and may take.
However, after-born children will be excluded.
Property I Slides

131

Rule of Convenience
T the children of A

If A Is Alive at Ts Death But Does Not Have Children at That


Time:
No one is then entitled to immediate distribution.
Therefore, the class should remain open.
All of As children, whenever born, will be included and
should be able to take.
Some authorities suggest that the first-born child takes the
entire estate on her birth, subject to partial divestment by the
birth of later children. 5 American Law of Property 22.42 at
355 (Casner ed. 1952) and Restatement (2d) of Property
294.
However, the case law on this point is sparse.

Property I Slides

132

Rule of Convenience

Postponed Gift to a Class (With No Condition Precedent)


If the class is already closed at the time the postponement ends
(e.g., at the end of a present possessory life estate), all members
of the class will be included and will take.
If the class has members but is not yet closed at the time the
postponement ends,
All members of the class conceived at the time the
postponement ends will be included and may take.
However, the class will close to the exclusion of after-born
children, who may not take.
If the class has no members at the time the postponement ends,
all members of the class, whenever born, will be included and may
take.

Property I Slides

133

Rule of Convenience
T A for life, remainder to the children of B

Example of Postponed Gift to a Class (With No Condition


Precedent): T A for life, remainder to the children of B.
If B Is Dead at the Time of Ts Death
If B is dead at the time of Ts death, the class of Bs
children will be closed.
Therefore, all of Bs children will be included and may take.
If B Dies After T But Before A
If B dies after T but before A, the class of Bs children will
also be closed.
Therefore, all of Bs children will be included and may take.

Property I Slides

134

Rule of Convenience
T A for life, remainder to the children of B

If B Is Alive at the Time of As Death and B Has Children at


That Time
All children then born are included and are entitled to
distribution at As death.
However, the class will close at that time to the exclusion
of after-born children.

Property I Slides

135

Rule of Convenience
T A for life, remainder to the children of B

If B Is Alive at As Death But Does Not Have Children at That


Time
No child is then entitled to immediate distribution.
The class should remain open.
Therefore, all of Bs children, whenever born, should be
included and should be able to take.
Again, some authorities suggest that the first-born child
takes the entire estate on her birth, subject to partial
divestment by the birth of later children. Restatement
(2d) of Property 295 and 5 American Law of Property
22.42 at 355 (Casner ed. 1952).

Property I Slides

136

Rule of Convenience
O to Bs children who reach 21

Immediate Gift to a Class Coupled With a Condition Precedent


An immediate gift to a class may be coupled with a condition precedent).
In such a case, the class closes when the first member of the class
satisfies the condition.
All then born members of the class are included and make take if and
when they satisfy the condition.
However, after-born children will be excluded.
Example of an Immediate Gift to a Class Coupled With a Condition
Precedent: O to Bs children who reach 21.
If B is Dead at the Time the Conveyance Is Made
If B is dead at the time the conveyance is made, the class of Bs
children will be closed.
Therefore, all of Bs children will be included and may take, if and
when they reach 21.

Property I Slides

137

Rule of Convenience
O to Bs children who reach 21

If B Is Alive at the Time the Conveyance Is Made and B Has


a Child Who Is 21
If B is alive at the time the conveyance is made, and B
has a child who has reached 21, the class will close,
because that child is entitled to immediate distribution.
All of Bs then born children will be included, and they
may take if and when they reach 21.
However, all after-born children will be excluded.

Property I Slides

138

Rule of Convenience
O to Bs children who reach 21

If B Is Alive at the Time the Conveyance Is Made and B Has


a Child Who Is 15
If B is alive at the time the conveyance is made, and B
has one child who is 15, the class will remain open.
The class will close if and when a child of B reaches 21.
All children of B born at the time the first child reaches 21
will be included, and they may take, if and when they
reach 21.
All children born after the first child reaches 21 are
excluded.

Property I Slides

139

Rule of Convenience
O to Bs children who reach 21

If B Is Alive at the Time the Conveyance Is Made and B Has


No Children
If B is alive at the time the conveyance is made, and B
has no children, the class will remain open.
The class will close if and when a child of B reaches 21.
All children of B born at the time the first child reaches 21
will be included, and they may take, if and when they
reach 21.
All children born after the first child reaches 21 are
excluded.

Property I Slides

140

Rule of Convenience

Gift to a Class With a Combination of Postponements (Combined


With a Condition Precedent)
A gift to a class may be made with a combination of
postponements (combined with a condition precedent).
In such a case, the postponement is deemed to end, and the
class closes, when the last condition is satisfied.
All members of the class born before the class closes are
included and may take, if and when they satisfy the condition.
However, all after-born persons are excluded.

Property I Slides

141

Rule of Convenience
O A for life, remainder to Bs children who reach 21

Example of Gift to a Class with a Combination of Postponements


(With a Condition Precedent): O A for life, remainder to Bs
children who reach 21.
If B Is Dead at the Time the Conveyance Is Made
If B is dead at the time the conveyance is made, the
class of Bs children will be closed.
Therefore, all of Bs children will be included, and they
may take, if and when they reach 21.

Property I Slides

142

Rule of Convenience
O A for life, remainder to Bs children who reach 21

If B Is Alive When the Conveyance Is Made But Dies Before


A
If B is alive when the conveyance is made but dies
before A, the class of Bs children will also be closed.
Therefore, all of Bs children will be included and they
may take, if and when they reach 21.

Property I Slides

143

Rule of Convenience
O A for life, remainder to Bs children who reach 21

If B Is Alive at the Time of As Death and B Has a Child Who


Is 21
That child is entitled to distribution at As death.
Therefore, the class will close at that time.
All children born before As death will be included and
may take, if and when they reach 21.
However, children born after the class closes will be
excluded.

Property I Slides

144

Rule of Convenience
O A for life, remainder to Bs children who reach 21

If B Is Alive at As Death and Has No Children or Has Children,


None of Whom Has Reached 21
No child is entitled to distribution at As death (which is the
first postponement).
Therefore, the class remains open until a child of B
reaches 21 (which is the second postponement).
When a child of B reaches 21, the class closes.
All children conceived at the time a child of B reaches 21
will be included and may take, if and when they reach 21.
However, children born after the class closes are excluded.

Property I Slides

145

RULE AGAINST PERPETUITIES


Common Law

No interest is good unless it must vest, if at all, not later


than twenty-one years after some life in being at the
creation of the interest.

Property I Slides

146

RULE AGAINST PERPETUITIES


Common Law

Analysis Steps

First, Identify the Interests Subject to RAP:


Interests that are fully vested at the time of creation are not
subject to RAP.
Presently possessory estates are fully vested.
Reversionary interests are fully vested.
Completely vested remainders are fully vested.
Interests that are not fully vested at the time of creation are
subject to RAP.
Remainders that are subject to open are not fully vested.
Contingent remainders are not fully vested.
Executory interests are not fully vested.

Property I Slides

147

RULE AGAINST PERPETUITIES


Common Law

Analysis Steps

Second, Identify the Life or Lives in Being, Express or Implied by the


Instrument Creating Interests.
Express Lives in Being: In the grant O conveys to A for life, O
and A are express lives in being.
Implied Lives in Being: In the devise to my grandchildren, the
testators children are implied lives in being.
Classes as Lives in Being: A class cannot be used as measuring
lives unless the class is closed at the time the gifts are created.
Third, Determine Whether the Interest Will Vest or Fail Within 21
Years of the Life or Lives (Might Have Been Rule). (See the
examples below.)

Property I Slides

148

RULE AGAINST PERPETUITIES


Common Law

Analysis Steps

Fourth, Treat the Part of the Gift That Violated RAP As Void, Leaving the
Remainder of the Gift in Tact:
O conveys to A for so long as liquor is not served on the premises, but if
liquor is served, to B.
The shifting executory interest in B is void.
A is left with a fee simple determinable.
O has a possibility of reverter.

O conveys to A, but if liquor is served then to B.


Again, the shifting executory interest in B is void.
However, in this case, A is left with a fee simple.
Therefore, O retains nothing, and A is left with a fee simple
absolute.

Property I Slides

149

RULE AGAINST PERPETUITIES


Fertile Octogenarian: O A for life, remainder to As children for
life, remainder to As grandchildren. (Jee v. Audley)

Interests Subject to RAP:


A: As life estate is presently possessory and therefore is not
subject to RAP.
As Children: The remainder for life in As children is either
contingent or subject to open (because A is conclusively presumed
to be capable of having more children) and therefore is subject to
RAP.
As Grandchildren: The remainder is As grandchildren is either
contingent or subject to open and therefore is subject to RAP.
Life or Lives in Being:
O and A are express lives in being.
Even if children or grandchildren are already born, these persons
are members of an open and class and therefore cannot serve as
lives in being.
Therefore O and A are the only possible measuring lives.

Property I Slides

150

RULE AGAINST PERPETUITIES


Fertile Octogenarian: O A for life, remainder to As children for
life, remainder to As grandchildren.

Vesting or Failing Within 21 Years of the Life or Lives In Being:


As Children: As children will take (or not take) at As death;
hence, their interest is valid.
As grandchildren: However, As grandchildren may well take
more than 21 years after O and A die; hence, their interest
violates RAP.
Eliminating Void Gifts:
A retains her life estate.
As children will take for life after A dies.
Because the interest in As grandchildren is void, O retains a
reversion, which will fall in after As children die.

Property I Slides

151

RULE AGAINST PERPETUITIES


Unborn Widow: O A for life, remainder to As widow for life,
remainder to As children living at the death of As widow.

Interests Subject to RAP:

A: As life estate is presently possessory and therefore is not subject to


RAP.
As Widow: The remainder for life in As widow is contingent (because
there cannot be a widow of a living person) and therefore is subject to
RAP.
As Children: The remainder in As children living at the death of As
widow is contingent (because there is a condition precedent to vesting)
and therefore is subject to RAP.

Life or Lives in Being:

O and A are express lives in being.


As widow is not a life in being, because she has not yet been identified.
As children, even if some are already born, may not be lives in being,
because their class is open.
Therefore O and A are the only possible measuring lives.

Property I Slides

152

RULE AGAINST PERPETUITIES


Unborn Widow: O A for life, remainder to As widow for life,
remainder to As children living at the death of As widow.

Vesting or Failing Within 21 Years of the Life or Lives In Being:


As Widow: The widow will take (or not take) at As death; hence
her interest is valid.
As Children: However, the children may well take more than 21
years after O and A die; hence, their interest violates RAP.
Eliminating Void Gifts:
A retains his life estate.
As widow will take for life after A dies (if she survives A).
Because the interest in As children is void, O retains a reversion,
which will fall in when As widow dies.

Property I Slides

153

RULE AGAINST PERPETUITIES


Charity to Charity Rule: O A Charity for so long
as liquor is not served on the premises, but if liquor is
served on the premises then to B Charity.

As illustrated above, a shifting executory interest in fee will violate


Rap (because an heir of A could violate the condition more than
twenty-one years after the death of O, A, and B, causing the
property to shift to an heir of B).
However, for policy public reasons, if both A and B are charities, the
shifting executory interest in B Charity will be deemed to be valid
under RAP.

Property I Slides

154

RULE AGAINST PERPETUITIES


Rule of Convenience: O such of A's
children as shall reach the age of 30.

Assume A is living at the time of this grant and has two children, B,
age 31, and C, age 25.
Because she is 31, B is entitled to immediate distribution.
As a result, the Rule of Convenience will operate to close the
class of As children immediately.
All children born as of the date the class closes (B and C) will be
allowed to take upon reaching the age of 30.
But no child born after the date the class closes may take, even
if he should eventually reach the age of 30.

Property I Slides

155

RULE AGAINST PERPETUITIES


Rule of Convenience: O such of A's
children as shall reach the age of 30.

Assume that A is alive at the testator's death and has three children,
B, age 25, C, age 23, and D, age 19.
Interests Subject to RAP: Because no child of A has reached 30, As
children have a springing executory interest, which is subject to RAP.
Life or Lives in Being:
O and A are express lives in being.
The class of As children cannot be measuring lives, because the
class remains open:
A is alive, and
No child of A is entitled to immediate distribution, because no
child of A has reached the age of 30.

Property I Slides

156

RULE AGAINST PERPETUITIES


Rule of Convenience: O such of

A's children
as shall
reach
age
Vesting
or Failing Within
21 Years
of the the
Life or
LivesofIn 30.
Being:
It is possible that a child of A could reach 30 more than twentyone years after the deaths of O and A.
Therefore, the springing executory interest in the children of A
violates RAP.
Eliminating Void Gifts: O is left with a fee simple absolute.

Property I Slides

157

Rule Against Perpetuities


T my children for life, remainder to my grandchildren.

Interests Subject to RAP


Ts children have a present possessory life estate (when T dies). Their
present possessory estate is not subject to RAP.
If no grandchildren have been born, the grandchildren have a
contingent remainder. That contingent remainder is subject to RAP.
If grandchildren have been born, they have a vested remainder subject
to open. This interest is subject to RAP.
Lives in Being
T is not a life in being, because T is dead.
Ts children may be measuring lives because the class is closed
(because T is dead).
Ts grandchildren may not be measuring lives because the class is
open.
Vesting or Failing Within 21 Years of a Life in Being
The grandchildren will take (or not take) within 21 years of the death of
their respective parents.
Therefore, the Interest in the grandchildren is valid.
Property I Slides

158

RULE AGAINST PERPETUITIES


Statutory Rule (USRAP)

A nonvested interest in real or personal property is invalid unless


It satisfies the common law RAP, or
It vests or terminates within 90 years of its creation.
Under the wait and see branch of USRAP, the court waits until the
end of the prescribed period to determine whether the interest
actually vested or failed within the prescribed period.

Property I Slides

159

RULE AGAINST PERPETUITIES


Statutory Rule: In 1990, 0 A for life, remainder to As
children for life, remainder to As grandchildren.

Assume that, at the time the conveyance is made, A is 55 and has


one child, B, who is 16.
In 1995, B marries.
In 2001, a child C, is born to B.
A dies in 2004 (at the age of 69).
B dies in 2040 (at the age of 66).
C may take the property in 2040:
The remainder to As grandchildren would be void under common
law RAP (See the Fertile Octogenarian example on Slides ## 8-9 ).
However, because C actually takes within 90 years of the
conveyance, her interest is valid under USRAP.

Property I Slides

160

CO-TENANCIES

Tenancy in Common

Tenancy in common is now the presumed form of co-tenancy.


Tenancy in common requires unity of possession only.
O A and B. A and B hold a fee simple absolute as tenants in
common.

Property I Slides

162

Joint Tenancy

Traditionally, the following words were required to create a joint


tenancy: to A and B as joint tenants and not as tenants in
common, with full right of survivorship.
Joint tenancy requires the four unities:
Time,
Title (same instrument),
Interest (equal shares of the same type), and
Possession.
Some jurisdictions now do not require time and title; hence a straw
no longer is required.
Ius accrescendi: Ius accrescendi is the Latin name for the right of
survivorship.

Property I Slides

163

Joint Tenancy Problems

Problem 1
O conveys Blackacre to A and B as joint tenants and not as
tenants in common, with full right of survivorship.
Subsequently, A dies, leaving C as her sole heir.
Bs right of survivorship takes over, and B becomes the sole
owner of Blackacre.

Property I Slides

164

Joint Tenancy Problems

Problem 2
O conveys Blackacre to A and B as joint tenants and not as
tenants in common, with full right of survivorship.
Subsequently, A conveys her interest in Blackacre to C.
The conveyance to C breaks the unity of time and title
(because C took by a different instrument from B, and C took at
a different time from B).
Therefore, B and C hold Blackacre as tenants in common.

Property I Slides

165

Joint Tenancy Problems

Problem 3
O conveys Blackacre to A, B, and C as joint tenants and not as
tenants in common, with full right of survivorship.
Subsequently, A conveys her interest in Blackacre to D.
The conveyance to D breaks the unity of time and title as to Ds
interest
Therefore, D holds his one-third interest as a tenant in common with
B and C.
However, the unities have not been destroyed in respect to B and C.
Therefore, B and C continue to hold their respective one-third
interests as joint tenants in respect to each other.

Property I Slides

166

Joint Tenancy

Mortgages
Title Theory:

Traditionally, in a title theory state, the execution of a


mortgage by one joint tenant causes the legal interest
of that co-tenant to be transferred to the mortgagee
(lender).

Thus, the mortgage severs the joint tenancy, because


the unities have been destroyed.
Lien Theory:

In a lien theory state, the mortgagee receives a lien


only on the property.

Therefore, no severance occurs when the mortgage is


made, because the unities remain in tact.

However, in a lien theory state, foreclosure will sever


the joint tenancy.

The courts are split as to whether a mortgage survives


if the mortgagor dies first.
Property I Slides

167

Joint Tenancy

Leases
The jurisdictions are split on whether a lease severs a joint tenancy.
Some courts hold that a lease does sever the joint tenancy, because
the unity of possession is destroyed by the lease.
Other courts hold that severance does not occur and permit the
surviving, non-leasing joint tenant to elect to declare the lease invalid
and evict the tenant.
Some courts find a temporary severance:

The lease severs if the lessor dies during the term.

But there is no severance if the lease ends before the lessor dies.
Another alternative is to find no severance but to require the surviving
joint tenant to take subject to the lease.

Property I Slides

168

Types of Joint Bank Accounts

True Joint Tenancy Bank


During the joint lives of the owners of a joint bank account, each
joint tenant holds a present right in the sums deposited in the joint
bank account.
In a few jurisdictions, each joint tenant presently holds an equal
fractional share in the sums deposited in the account (which
mirrors the rule for a joint tenancy in real property).
In most jurisdictions, the present right of each joint tenant is
presumptively proportional to that tenants net contribution to
the account. U.P.C. 6-211.
On the death of one of the joint tenants, the survivor takes the
sum remaining in the account.
In the majority of jurisdictions, a joint bank account is presumed to
be a true joint tenancy.
In some jurisdictions, the burden of disproving a true joint
tenancy is placed on the person challenging the joint tenancy
status of the account.
In other jurisdictions, survivorship rights are conclusively
presumed.

Property I Slides

169

Types of Joint Bank Accounts

Payable On Death Bank Account

The party who created the account (the owner) has


the present right to all sums deposited in the account.
The other party has survivorship rights only.
Convenience (Power-of-Attorney) Bank Account
The party who created the account (the owner) has
the present right to all sums deposited in the account.
The other party

May draw on the account presently to pay the owners


bills, but
Has no survivorship rights.

Property I Slides

170

Accounting for Rents and Profits


and Repairs

Accounting
An accounting is not allowed for personal use (unless there
has been ouster or exploitation resulting in permanent
depreciation
An accounting may be had for rents from third parties (less
operating expenses, such as taxes, mortgages, interest,
and management fees).
Repairs
The common law approach (still followed in some states)
does not allow such contribution.
Under the modern trend, contribution may be compelled for
necessary repairs, if they were requested and refused.
In a partition suit or an accounting, the costs of repairs may
be credited in favor of a co-tenant who repairs.
Property I Slides

171

Improvements, Taxes and


Mortgages

Improvements
There is no right to contribution or set-off, unless the
improvements generate increased rents or profits.
Costs of improvements are recoverable only in a suit to
partition.
Taxes and Mortgages
A co-tenant who pays a mortgage or taxes may recover in
an accounting or partition suit (but there is no separate
action to compel contribution.
However, the co-tenant in sole possession will receive
reimbursement only to the extent that his payment exceeds
the market value of the property.

Property I Slides

172

Partition

Voluntary Partition: Voluntary partition is usually accomplished by


an exchange of mutual deeds among co-tenants or by sale of the
property and division of the proceeds.
Involuntary Partition: Involuntary (judicial) partition is by court
action, usually at the instance of one but not all of the co-tenants.
Owelty: When partition cannot produce equal shares, the party
receiving the larger portion makes a cash payment to the other
party.

Property I Slides

173

Tenancy by the Entirety

Traditionally, to create a tenancy by the entirety, the following


words are required: to H and W as tenants by the entirety
and not as joint tenants or tenants in common, with full
right of survivorship.
Twenty-five jurisdictions have abolished tenancy by the entirety:
The eight community property states (Arizona, California,
Idaho, Louisiana, Nevada, New Mexico, Texas, and
Washington) and
Seventeen other states that recognize common law
concurrent estates (Alabama, Colorado, Connecticut,
Georgia, Iowa, Kansas, Maine, Minnesota, Montana,
Nebraska, New Hampshire, North Dakota, South Carolina,
South Dakota, Utah, West Virginia, and Wisconsin).

Property I Slides

174

Tenancy by the Entirety


Jurisdictional Views from Sawada v.
Endo

Four different approaches are followed in the remaining twenty-one


states and the District of Columbia.
Group I (Massachusetts, Michigan and North Carolina at the
time Sawada v. Endo was decided but no states currently)

A tenancy by the entirety exists as at common law,


unaffected by Married Women's Property Acts.

The husband may convey the entire estate subject only to


the possibility that the wife may become entitled to the
whole estate on surviving him.

Property I Slides

175

Tenancy by the Entirety


Jurisdictional Views from Sawada v.
Endo

Group II (Alaska, Arkansas, New Jersey, New York, and


Oregon at the time of Sawada v. Endo and now also
Massachusetts and possibly Mississippi, Ohio and Oklahoma):

The interest of the debtor spouse may be sold or levied on


for his or her separate debts, subject to the other spouse's
right of survivorship.

Under the Alaska statute, the interest of the debtor spouse


in any type of estate, except for homestead held as tenancy
by the entirety, is subject to his or separate debts.

Property I Slides

176

Tenancy by the Entirety


Jurisdictional Views from Sawada v.
Endo

Group III (majority view for states that still recognize the
tenancy by the entirety) (Delaware, District of Columbia,
Florida, Indiana, Maryland, Missouri, Pennsylvania, Rhode
Island, Vermont, Virginia, and Wyoming at the time of Sawada
v. Endo and now also Hawaii, Illinois, Michigan, and North
Carolina):

An attempted conveyance by either spouse is wholly void.

The estate may not be subject to the separate debts of one


spouse only.

Property I Slides

177

Tenancy by the Entirety


Jurisdictional Views from Sawada v.
Endo

Group IV (Kentucky and Tennessee):

The contingent right of survivorship of either spouse is


separately alienable by him and attachable by his creditors
during the marriage.

But the use and profits cannot be alienated or attached


during the marriage.

Property I Slides

178

EQUITABLE DISTRIBUTION
IN FLORIDA: Marital Assets

179

On dissolution of marriage and absent any valid antenuptial (prenuptial)


or settlement agreement, the court may make an equitable distribution
of all marital property based on statutory guidelines.
Distribution must be equal unless unequal treatment can be justified.
Marital assets include
Assets acquired by either or both spouses during the marriage other
than by gift, bequest, or descent,
The enhancement in value and appreciation of nonmarital assets
resulting either from the efforts of either party during the marriage or
from the contribution to or expenditure thereon of marital funds or
other forms of marital assets or both,
Interspousal gifts during the marriage.

EQUITABLE DISTRIBUTION
IN FLORIDA: Marital Assets

180

All benefits accrued during the marriage in retirement, pension


and profit-sharing plans.
All property held as tenants by the entirety, whether acquired
prior to or during the marriage, which is presumed to be a marital
asset.
Record title in the joint names of the spouses without any
further designation indicating the manner in which the
property is held creates a presumption of tenancy by the
entirety, and the property is a marital asset regardless of who
paid for the property.

EQUITABLE DISTRIBUTION
IN FLORIDA: Nonmarital Assets

181

Nonmarital Assets
Assets acquired prior to marriage or acquired in exchange for
such assets or liabilities.
Assets acquired separately by either person by non-interspousal
gift, bequest, devise or descent and assets acquired in
exchange for such assets.
All income derived from nonmarital assets during marriage
unless the income is treated or relied on by the parties as marital
assets.
Assets and liabilities excluded from marital assets by agreement
between the parties.

EQUITABLE DISTRIBUTION
IN FLORIDA: Distribution Factors

182

The contribution to the marriage by each spouse, including contributions


to the care and education of children and services as a homemaker.
The economic circumstances of each party, that is, the material comfort of
the separate parties.
The duration of the marriage.
The interruption of personal careers or educational opportunities of either
party:.
The contribution of one spouse to the personal career or education
opportunity of the other spouse.
The desirability of retaining any asset, including an interest in a business,
corporation, or professional practice intact and free from any claim or
interference by the other person.
The contribution of each spouse to the acquisition, enhancement and
production of income or improvements of, or the incurring of liability to,
both marital assets and nonmarital assets.

EQUITABLE DISTRIBUTION
IN FLORIDA: Distribution Factors

183

The desirability of and feasibility of retaining the marital home: The court
may award exclusive possession of the home for a period of time by
considering
The best interests of dependent children to remain in the home.
The equities served by giving a particular party exclusive use and
possession of the home.
And any physical or mental disability suffered by a spouse that would
make staying in the home more appropriate.
Or any other factors necessary to do equity and justice between the
parties.
Any other factors necessary to do equity and justice between the parties.
Equitable distribution must be made without regard to alimony.

ALIMONY IN FLORIDA
Statutory Factors

184

The standard of living during the marriage.


The duration of the marriage.
The age and emotional and physical condition of both parties.
The financial resources and sources of income of each party.
When applicable, the amount of time needed to obtain education or
training.
Each partys contribution to the marriage, including homemaking, child
care, education, and career building of the other party.
Any factors that will foster equity, including marital misconduct.
Generally, marital misconduct may not be considered in a dissolution
action and in the equitable division of property.
However, the court is specifically permitted to consider the adultery
of either spouse in awarding alimony if the marital misconduct
depleted or adversely affected the family funds.

U.S. v. 1500 Lincoln Avenue


Possible Outcomes Under the Forfeiture Statute
Ownership of Property

The tenancy by the


entirety remains in tact.

Rationale
Because the innocent tenant by
the entirety has the right to
possess the whole, no interest was
subject to forfeiture. In
Pennsylvania, neither tenant by the
entirety may convey his or her
interest voluntarily or involuntarily.

Party Advocating

Mrs. Bernstein

The interest of the guilty spouse is


The government
subject to forfeiture, and the
before trial
innocent spouse has no severable
interest that she is entitled to retain.
The government and the The forfeiture of the guilty spouses
The government at
innocent spouse hold as interest severs the tenancy by the
trial
tenants in common.
entirety.
The innocent spouse has
The government in
The
interest
of
the
guilty
spouse
is
a life estate, followed by
its motion to amend
forfeited;
however,
the
interest
of
contingent remainders in
the judgment of the
the
innocent
spouse
is
protected.
the government and the
trial court and on
innocent spouse.
appeal

Judicial Adoption
Trial court (with
the caveat that the
government may
file a lis pendens
against the
property)

The government owns


the whole property.

Third Circuit
Court of Appeals

LANDLORD AND TENANT

Garner v. Gerrish

Language Used: for and during the term of quiet enjoyment from the first
day of May, 1977 which term will end Lou Gerrish has the privilege of
termination [sic] this agreement at a date of his own choice.
County Court: The trial court granted summary judgment to lessor
Donovans executor on the ground that
the lease was for a month to month term because, while it specified a
specific date of commencement, it failed to set forth the duration of
continuance and the date or event of termination, and
The lessors executor could terminate the lease at the end of the next
month of occupancy because a lease that is expressly terminable at the
will of the lessee is also impliedly terminable at the will of the lessor.
(This rule, which dates back to Coke, is questioned by a number of
courts. )

Garner v. Gerrish
Coke also stated that a lease that is expressly terminable at the
will of the lessor is also impliedly terminable at the will of the
lessee.
This rule is still the majority rule.
However, according to the Second Restatement, if the lease
is terminable at the will of the lessor only, the lessee gets a
fee simple determinable. Restatement (2d) of Property
(Landlord & Tenant) See 1.7, illus. 7.
Some authorities question the Restatement rule.
Appellate Division: The Appellate Division affirmed for the same
reasons.

Garner v. Gerrish

Court of Appeals: The Court of Appeals reversed and dismissed the


petition of the lessors executor:
The Court of Appeals rejected Cokes rule, which implied a right to
terminate in the lessor if the lessee had an express right to terminate.
The Court of Appeals followed the Second Restatement rule (which is
the modern trend), which
Declines to imply a right to terminate in the lessor if the lessee has
an express right to terminate and
Instead finds a life estate determinable that is terminable at the
lessees will or the lessees death. See comment h to
Restatement (2d) of Property (Landlord & Tenant) 1.5. (To
lessee, for so long as lessee desires to stay on the premises)

Types of Tenancies

190

Creation
Express: A lease may be made orally or by a writing.
Implied
An implied lease may be created by the conduct of the
parties when the written lease is invalid writing, resulting in a
periodic tenancy.
An implied lease may also be created when a holdover
tenant pays rent and the lessor accepts the rent.
Types of Tenancies
Term of Years: A writing generally is required by the Statute of
Frauds for a term of years over one year.

Property Slides

Types of Tenancies: Periodic

191

A periodic tenancy continues from period to period (e.g., from


month to month) without a set termination date.
Termination of Periodic Tenancy: To terminate a periodic tenancy
in Florida, the following notice requirements must be met:
Residential
Year to year: 60 days.
Quarter to quarter: 30 days.
Month to month: 15 days.
Week to week: 7 days.
Nonresidential
Year to year: 3 months.
Quarter to quarter: 45 days.
Month to month: 15 days.
Week to week: 7 days.

Property Slides

Types of Tenancies: At-Will

192

An at-will tenancy terminates if


Either party dies,
The tenant commits waste,
The tenant attempts to assign her interest,
The landlord transfers his interest, or
The landlord transfers the premises to a third party for a terms of
years.

Property Slides

Types of Tenancies: Tenant at


Sufferance/Holdover Tenant

193

A tenancy at sufferance occurs when a tenant holds over after the


end of the lease term.
A tenancy at sufferance is not a true tenancy.
If a residential tenant holds over, in most states (including Florida),
the lessor may recover possession and may receive double rent for
the holdover period.

Property Slides

Problem 1 (p. 364)

Basic Facts: L transfers to T on 1 October, and T moves out on the


following 30 September without giving notice to T.
First Example: L transfers to T for one year, beginning October 1.
Ls transfer creates a term of years.
No notice is required to terminate a term of years.
Therefore, T may move out on 30 September without giving any
notice to L.

Problem 1 (p. 364)

Second Example: L transfers to T from year to year, beginning on


October 1.
Ls transfer creates a periodic tenancy, measured on a year to year
basis.
The common law required six months notice to terminate a year-toyear periodic tenancy.
Most jurisdictions now have statutory requirements for the
termination of a periodic tenancy.
Florida requires three months notice to terminate a year-to-year
tenancy.

Problem 1 (p. 364)

Third Example: L transfers to T for no fixed term at an annual rent of


$24,000 payable $2,000 per month on the first of each month.
The length of the notice required depends on the length of the
period.
In some jurisdictions, the period is determined by the rent
reservation clause (annual rent of $24,000).
In other jurisdictions, the period is determined by the rent payment
clause ($2000 per month on the first of each month).

Civil Rights Act of 1866


42 U.S.C. 1982

All citizens of the United States shall have the same right, in every State
and Territory, as is enjoyed by white citizens thereof to inherit, purchase,
lease, sell, hold, and convey real and personal property.

Fair Housing Act


42 U.S.C. 3601. Declaration of Policy

It is the policy of the United States to provide, within constitutional


limitations, for fair housing throughout the United States. . .

Fair Housing Act


42 U.S.C. 3602(k). Definition of Familial Status

Familial status [includes] one or more individuals (who have not


attained the age of 18 years) being domiciled with [a parent or
guardian].

Fair Housing Act


42 U.S.C. 3603. Effective Dates of Certain
Prohibitions

(a) Application to certain described dwellings


Subject to the provisions of subsection (b) of this section , the prohibitions
against discrimination in the sale or rental of housing set forth in section
3604 of this title shall apply....
(b) Exemptions: Nothing in section 3604 of this title (other than subsection
(c) ) shall apply to-(1) any singlefamily house sold or rented by an owner: Provided, That such
private individual owner does not own more than three such single-family
houses at any one time.
2) rooms or units in dwellings containing living quarters occupied or intended
to be occupied by no more than four families living independently of each
other, if the owner actually maintains and occupies one of such living
quarters as his residence....

Fair Housing Act


42 U.S.C. 3604. Discrimination In the Sale or
Rental of Housing and Other Prohibited Practices

As made applicable by section 3603 of this title and except as exempted by


sections 3603(b) of this title, it shall be unlawful
(a) To refuse to sell or rent after the making of a bona fide offer, or to refuse
to negotiate for the sale or rental of, or otherwise make unavailable or deny,
a dwelling to any person because of race, color, religion, sex, familial
status, or national origin.
(b) To discriminate against any person in the terms, conditions, or privileges
of sale or rental of a dwelling, or in the provision of services or facilities in
connection therewith, because of race, color, religion, sex, familial status, or
national origin.
(c) To make, print, or publish, or cause to be made, printed, or published
any notice, statement, or advertisement, with respect to the sale or rental of
a dwelling that indicates any preference, limitation, or discrimination based
on race, color, religion, sex, handicap, familial status, or national origin, or
an intension to make any such preference, limitation, or discrimination.

Fair Housing Act


42 U.S.C. 3604. Discrimination In the Sale or
Rental of Housing and Other Prohibited Practices

(f)(1) To discriminate in the sale or rental, or to otherwise make


unavailable or deny, a dwelling to any buyer or renter because of a
handicap of

(A) that buyer or renter;

(B) a person residing in or intending to reside in that dwelling after it


is so sold, rented, or made available; or

(C) any person associated with that buyer or renter.


.
(3) For purposes of this subsection, discrimination includes
.

(B) a refusal to make reasonable accommodations in rules,


policies, practices, or services, when such accommodations may
be necessary to afford such person equal opportunity to sue and
enjoy a dwelling.

Problem 3 (p. 380)


Variation #1

Facts
Mrs. Murphy placed the following advertisement in a local newspaper:
For rent: Furnished basement apartment in private white home. Call
376-7410.
A black couple applied and was rejected by Mrs. Murphy on the basis
of race.
Analysis
Section 1982
Refusal to Rent: Mrs. Murphy violated the Civil Rights Act of 1866
because her rejection of the couple was based on race.
Advertisement: However, the advertisement did not violate the Civil
Rights Act because the provisions of the Act do not extend to ads.

Problem 3 (p. 380)


Variation #1 (continued)

FHA
Refusal to Rent
Because she owns and lives in a home with an apartment
for rent, Mrs. Murphy falls within the exemption provided
under 3603(b)(2) for the owner of a four-family or less
dwelling who lives in one of the units.
Therefore, Mrs. Murphys refusal to rent to the black
couple did not violate the FHA.
Advertisement
The exemption of 3603(b)(2) does not apply to
3604(c).
The ad suggests discrimination based on race.
Therefore, the ad does violate the FHA.

Problem 3 (p. 380)


Variation #2

Facts
Mrs. Murphy placed the following advertisement in a local newspaper:
For rent: Furnished basement apartment in private home. Call 3767410.
A black couple applied and was rejected by Mrs. Murphy on the basis of
race.
Analysis
Section 1982
Refusal to Rent: Mrs. Murphy violated the Civil Rights Act of 1866
because her rejection of the couple was based on race.
Advertisement: However, the advertisement could not violate the Civil
Rights Act because the provisions of the Act do not extend to ads.

Problem 3 (p. 380)


Variation
#2
(continued)
FHA

Refusal to Rent
Because she owns and lives in a home with an apartment
for rent, Mrs. Murphy falls within the exemption provided
under 3603(b)(2) for the owner of a four-family or less
dwelling who lives in one of the units.
Therefore, Mrs. Murphys refusal to rent to the black couple
did not violate the FHA.
Advertisement
The exemption of 3603(b)(2) does not apply to 3604(c).
However, the advertisement does not suggest
discrimination based on race.
Therefore, the ad does not violate the FHA.

Problem 3 (p. 380)


Variation #3

Facts
Mrs. Murphy placed the following advertisement in a local
newspaper: For rent: Furnished basement apartment rented
only to persons speaking Polish, German or Swedish. Call 3767410.
A black couple applied and was rejected by Mrs. Murphy
because they did not speak Polish, German or Swedish.

Problem 3 (p. 380)


Variation #3 (continued)

Analysis
Section 1982
Refusal to Rent
By refusing to rent to anyone who did not speak Polish, German,
or Swedish, Mrs. Murphy may have violated the Civil Rights Act of
1866:
The Supreme Court has held that, for the purposes of the Civil
Rights Act of 1866, race means what race meant at the
time the Act became law.
According to the Court, in 1866, people commonly talked, for
example, of the German race.
Therefore, by refusing to sell to anyone not speaking, e.g.,
German, Mrs. Murphy may have refused to sell based on
race.

Problem 3 (p. 380)


Variation #3 (continued)
Advertisement: However, the advertisement did not violate the
Civil Rights Act because the provisions of the Act do not
extend to ads.
FHA
Refusal to Rent
Because she owns and lives in a home with an apartment
for rent, Mrs. Murphy falls within the exemption provided
under 3603(b)(2) for the owner of a four-family or less
dwelling who lives in one of the units.
Therefore, Mrs. Murphys refusal to rent to anyone not
speaking Polish, German, or Swedish did not violate the
FHA.

Problem 3 (p. 380)


Variation #3 (continued)

Advertisement
The exemption of 3603(b)(2) does not apply to
3604(c).
By restricting tenants to persons speaking Polish,
German, or Swedish, the ad may suggest a
preference based on national origin.
Therefore, the ad may violate the FHA.

Problem 3 (p. 380)


Variation #4

Facts
Mrs. Murphy placed the following advertisement in a local
newspaper: For rent: Furnished basement apartment. Germans
need not apply. Call 376-7410.
A German couple applied and was rejected by Mrs. Murphy.

Problem 3 (p. 380)


Variation #4 (continued)

Analysis
Section 1982
Refusal to Rent
By refusing to rent to Germans, Mrs. Murphy may have
violated the Civil Rights Act of 1866:
The Supreme Court has held that, for the purposes of the
Civil Rights Act of 1866, race means what race meant
at the time the Act became law.
According to the Court, in 1866, people commonly talked,
for example, of the German race.
Advertisement: However, the advertisement did not violate the Civil
Rights Act because the provisions of the Act do not extend to ads.

Problem 3 (p. 380)


Variation #4 (continued)

FHA
Refusal to Rent
Because she owns and lives in a home with an
apartment for rent, Mrs. Murphy falls within the
exemption provided under 3603(b)(2) for the owner
of a four-family or less dwelling who lives in one of
the units.
Therefore, Mrs. Murphys refusal to rent to Germans
did not violate the FHA.

Problem 3 (p. 380)


Variation #4 (continued)

Advertisement
The exemption of 3603(b)(2) does not apply to
3604(c).
By excluding Germans from potential applicants, the
ad discriminates on the basis of national origin.
Therefore, the ad violates the FHA.

Lessees Duties

Rent: A lessee has a duty to pay rent.


Waste
The lessees duties in respect to waste are similar to those
owed by life tenants.
However, the lessee's duty not to commit permissive waste
(primarily in respect to repairs) is not limited to the extent of
income derived or reasonable rental value when the lessee
possesses personally.
In addition, a lessee (except possibly a tenant for a long term)
may not commit ameliorative waste (which a life tenant may
do).
Statutory Duties: In most states, the lessee also has duties
assigned by statute, such as the duty to keep the premises clean.

Property I Slides

215

Lessors Remedies for Lessees


Breach of Duty

Material Breach: If the lessee fails to pay rent or commits another


material breach of the lease, the lessor may seek
To evict the lessee.
To recover damages for the lessees breach.
Abandonment: If the lessee abandons the premises, the lessor
may
Retake the premises when the lessee abandons,
Ignore an abandonment and continue to hold the tenant liable
for rent, or
Reenter and relet the premises for the lessee.

Property I Slides

216

Assignments and Subleases

Assignment:

An assignment occurs when the lessee transfers to a third person all of her
right, title and interest in the leased premises.

An assignee comes into privity of estate with the lessor.

Therefore, if the rent is not paid, the lessor may sue the assignee, so long as
the assignee remains on the premises.

However, the lessor may not sue the assignee after the assignee has
transferred the premises to another third person, unless the assignee had
assumed the duty to pay rent.
Sublease:

A sublease occurs when the lessee transfers to a third person less than all of
her right, title and interest in the leased premises.

A sublessee does not come into privity of estate with the lessor.

Therefore, absent an express assumption of the duty to pay rent, the lessor
may not sue the sublessee directly for rent due.

Property I Slides

217

Ernst v. Conditt
(If Conditt Was a Sublessee)
Ernsts

(Plaintiffs)

(Landlords)

Tract of land
for race track
Rent

(Privity of Contract)
(Privity of Estate)

Rogers
(Tenant #1)
(Lease)
(Privity of Contract)
(Privity of Estate)

(No Privity
of Contract)

(No Privity
of Estate)
Tract of land
for race track
Rent

Conditt
(Tenant #2)
(Sublease)

Property I Slides

(Defendant)
218

Ernst v. Conditt
(If Conditt was an Assignee)
Ernsts
(Landlords)

(Plaintiffs)
Tract of land
for race track
Rent

(Privity of Contract)
(Privity of Estate)

(Privity of Estate)

Rent
Rogers
(Tenant #1)

(Lease)

Tract of land
for race track

Conditt
(Defendant)
(Tenant #2)
(Assignment)

(Privity of Contract)
(Privity of Estate)
Property I Slides

219

Ernst v. Conditt
Third Party Beneficiary Analysis
(If Conditt as Sublessee Assumed the Duty to Pay Rent to the
Ernsts)
Ernsts
Beneficiaries

Plaintiffs

Intent
Pay rent
Lease

Rogers
Promisee

Sublease

Assumption
Property I Slides
of rent

Conditt
Promisor

Defendant
220

Question #2(c) (text p. 394)


L

(Privity of Contract)

(Privity of Estate)

(Privity of Estate)

XT
(Lease)

T
X

(Assignment)
(Assume Duty
To Pay Rent)

(Assignment)

T is liable to L based on privity of contract.


T1 is liable to L based on assumption of duty to pay rent.
T2 is not liable to L (no privity and no assumption).
T3 is liable to L based on privity of estate.
Property I Slides

T2

T3
(Assignment)

221

Question #2(c) (text p. 394)


Variation
L

(Privity of Contract)

(Privity of Estate)

(Privity of Estate)
T
X

(Lease)

T1

T2

(Assignment)
(Assumption)

(Assignment)

(Privity of Contract)
(Privity of Estate)

T is liable to L based on privity of contract.


T1 is liable to L based on assumption of duty to pay rent.
T2 is liable to L based on privity of estate.
I Slides
T3 is not liable to L (no privity and noProperty
assumption).

T3
(Sublease)
222

Kendall v. Pestana
City of San Jose
(Landlord)

Hangar space

1
Rent

Perlitches
(Tenants)
(Lease)

Reversion in hangar
3
Pestana
(Assignee) (Defendant)
(Assignment)
$$$

Hangar space
Hangar space
for 25 years
for 25 years
Rent
Kendall and Gradies (Plaintiffs)
Bixler
(Assignees)
(Sub-Tenant)
(Assignment)
(Sublease)
$$$

Property I Slides

223

Problem 4 (p. 402)


Rule in Dumpors Case

Facts
L leases to T for a term of five years at a monthly rent of $900.
T covenants to pay rent and not to sublet or assign without L's
permission.
T then with L's permission assigns to T1, who does not
expressly assume the obligations of the lease.
T1 then assigns to T2 without obtaining L's permission.
T2 defaults in rent payment and L sues T1 for the amount due.

Property I Slides

224

Problem 4 (p. 402) (continued)

Analysis
The rule in Dumpor's Case terminates the prohibition against
assignment when the landlord consents unless the landlord
specifically reserves the right to prohibit future assignments.
Although it is disapproved by the Restatement, Dumpor's Case
still survives in some jurisdictions.
If Dumpor's Case applies here, T1 wins:
T1's assignment is good even without L's permission.
T1 did not assume the covenants of lease, so he is no longer
liable once he transfers.
If Dumpor's Case does not apply, L wins, because L and T1 still
are in privity of estate.
Dumpor's Case does not apply to subleases.

Property I Slides

225

Summary Eviction Proceedings in


Florida

Summary Eviction Proceedings: In Florida, if a lessorlessee


relationship exists between the parties, the lessor may remove the
lessee through an action for summary eviction filed in the county
court.
Holdover Lessee: If the lessee wrongfully holds over, the lessor may
commence a summary eviction proceeding by filing a complaint in
the county court.

Property I Slides

226

Summary Eviction Proceedings in


Florida

Failure to Pay Rent


If the lessee fails to pay rent when it is due and the default
continues for three days, excluding Saturdays, Sundays, and legal
holidays, after delivery of a written demand for payment of rent or
possession, the lessor may terminate the rental agreement.
The written demand may be served on the lessee personally,
by mail or delivery, or by posting on the premises if the lessee
is absent.
If the lessee does not act by the end of the three-day notice
period, the lessor may commence a summary eviction
proceeding in the county court.

Property I Slides

227

Summary Eviction Proceedings in


Florida

Uncurable Failures to Perform


The lessor may bring an action for eviction in a county court
based on failure to perform under the lease, if the failure to
perform is not curable.
The lessor must give written notice to the tenant, and the tenant
is then given seven days to vacate.

Property I Slides

228

Summary Eviction Proceedings in


Florida

Defenses That May be Asserted by the Lessee in the Summary


Eviction Proceeding: In an action by the lessor for possession based
on nonpayment of rent or in an action by the lessor to recover
unpaid rent, the lessee may defend that the lessor materially failed
to comply with her duty to maintain premises or may raise any other
defense, legal or equitable, that he may have, including retaliatory
eviction.
Note: If the lessor win the summary eviction proceeding, they may
obtain possession from the sheriff after posting a 24-hour notice on
the property.

Property I Slides

229

Lessors Duties
Delivery of Possession

The majority (English) rule (which Florida follows) requires delivery


of actual possession.
The minority (American) rule requires the legal right to possession
only.

Property I Slides

230

Lessors Duties

Delivery of Possession
The majority (English) rule (which Florida follows) requires
delivery of actual possession.
The minority (American) rule requires the legal right to
possession only.
Statutory Duties: Typically, state law creates certain duties for the
lessor, such as the provision of running water and heat.
Covenant of Quiet Enjoyment: The lessor must not engage in any
activity the causes the lessee to be evicted constructively from the
premises.
Implied Warranty of Habitability: Under the modern trend, the lessor is
deemed to have warranted impliedly that residential premises are fit
for habitation.

Property I Slides

231

Lessees Remedies for Lessors


Breach of Duty

Strict Common Law


At strict common law, the covenants of land landlord and tenant
were deemed to be independent.
Therefore, the tenant was required to continue to perform her
duties under the lease, including the duty to pay rent, even if
the landlord breached the lease.
Statutory Innovations: Under some state statutes, if a lessor
breaches the lease, the tenant may
Withhold rent.
Repair and deduct.

Property I Slides

232

Lessees Remedies for Lessors


Breach of Duty

Breach of Covenant of Quiet Enjoyment: To assert a lessors


breach of the covenant of quiet enjoyment, resulting in a
constructive eviction of the lessee, the lessee must move out of the
premises.
Breach of the Warranty of Habitability
The tenant may sue for damages.
The tenant need not vacate the premises.

Property I Slides

233

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

Independent Covenants
Traditionally, the covenants in a lease were viewed as
independent.
If the lessor breached a lease covenant, the lessee could
sue for damages but could not treat the lease as terminated
and withhold rent.

Property I Slides

234

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

Covenant of Quiet Enjoyment


Every lease contains a covenant of quiet enjoyment
(express or implied).
In the covenant of quiet enjoyment, the lessor promises that
the lessee will not be disturbed by the lessor (or someone
claiming through the lessor) in her possession of the
premises.
A lessee may treat the lease as terminated and withhold
rent if the covenant of quiet enjoyment has been breached
by an actual or a constructive eviction.

Property I Slides

235

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

Actual Eviction:
A lessee may treat the lease as terminated and withhold
rent if the lessor (or someone claiming through him)
breaches the covenant of quiet enjoyment by actually
evicting the lessee.
Partial Actual Eviction: If a lessee is actually evicted from
part of the premises, under the majority rule, the lessee
is relieved of all liability for rent, even if the lessee
continues to occupy the rest of the premises. (The
Second Restatement of Property rejects the majority rule
and calls for a rent abatement only.)

Property I Slides

236

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

Constructive Eviction
A lessee may treat the lease as terminated and withhold
rent if the lessor breaches the covenant of quiet enjoyment
by constructively evicting the lessee.
To assert a claim of constructive eviction, the lessee must
move out of the premises.
To constitute constructive eviction, the lessors act must
substantially and permanently interfere with the lessees
use and enjoyment of the premises.

Property I Slides

237

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

The following acts by the lessor constitute constructive


eviction:
Withholding something essential to the full enjoyment of
the lease that is included within the terms of the lease,
such as heat.
Withholding something required by statute, such as hot
and cold running water.

Property I Slides

238

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

A lessor probably constructively evicts the lessee if she


breaches one of the following lessor duties created at
common law as exceptions to the traditional caveat lessee
rule:
Make and keep the premises habitable in a short-term
lease of a furnished dwelling.
Disclose latent defects existing in the premises,
known to the lessor, and undiscoverable by the lessee
at the time the lease was made.
Maintain common areas used by all tenants.

Property I Slides

239

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction
Use due care in making promised or volunteered
repairs.
Refrain from making fraudulent misrepresentations
concerning the condition of the leased premises.
In some jurisdictions, to abate immoral conduct or
abate nuisances on properties owned by the lessor
that may affect the leased premises.
Partial Constructive Eviction: If a lessee is constructively
evicted from part of the premises, under the majority rule,
the lessee may receive a rent abatement but is not relieved
of all liability for rent.

Property I Slides

240

Breach of Covenant of Quiet


Enjoyment/Constructive Eviction

Money Damages For Breach of the Covenant of Quiet


Enjoyment In the Absence of Actual or Constructive Eviction: If
a lessors breach of the covenant of quiet enjoyment does not
constitute actual eviction or is not substantial enough to
constitute constructive eviction, some states permit the lessee
who remains on the premises to seek money damages from the
lessor.

Property I Slides

241

Constructive Eviction and


Breach of Implied Warranty of Habitability
Theory

Constructive
Eviction
(Breach of
Covenant of
Quiet Enjoyment)

Breach of
Implied Warranty
of Habitability

Basis for
Cause of Action

Effect of Breach
on the Lease

Remedies
Available

The tenant must


show an
interference with
beneficial use and
enjoyment of the
premises serious
enough to amount
to an eviction.

The tenant is excused


from further performance
under the lease.
Traditionally, the tenant
must vacate the
premises within a
reasonable time.

The tenant may


treat the lease
as cancelled.
Rent is abated.

The tenant must


show a patent or
latent defect in
essential residential
facilities.

The tenant is excused


from further performance
under the lease.
The tenant may
but need not
vacate the premises.

Property I Slides

The tenant may


treat the lease
as cancelled.
Rent is abated.
The tenant may
seek money
damages,
reformation, or
other traditional
contract remedies.
242

Other Landlord/Tenant Issues

Covenants Against Assignments and/or Subleases


Such covenants are construed strictly against the landlord.
Rule in Dumpors Case (1603): Once waived, a covenant
against assignment is unenforceable as to the next
assignment.
Condemnation
For total condemnation, the lease and the obligation to pay rent
are terminated, and both the lessor and the lessee may recover
from the government.

For partial condemnation, the tenant may receive a rent


abatement for any lost value not recovered from the
government.

Property I Slides

243

Implied Warranty of Habitability

Nature of Warranty: The implied warranty of habitability guarantees


that the lessor will deliver and maintain premises that are safe,
clean and fit for human habitation.
Adoption: At least forty states and the District of Columbia have
adopted the implied warranty of habitability.
Basis for Cause of Action: The tenant must show a defect in
essential residential facilities.
In the majority of jurisdictions, the defect may be patent or latent.
Some jurisdictions exclude patent defects from the scope of the
implied warranty of habitability.

Property I Slides

244

Implied Warranty of Habitability

Types of Facilities Covered


The implied warranty of habitability applies to residential leases.
Commercial leases are not covered by the warranty.
The following leases may also excluded from coverage under
the implied warranty of habitability:
Leases for single-family residences.
Agricultural leases.
Long-term leases.
Casual leases made by nonmerchant lessors.

Property I Slides

245

Implied Warranty of Habitability

Warranty Standard
Housing Codes
In some jurisdictions, a housing code violation automatically
breaches the implied warranty of habitability.
In other jurisdictions, the housing code provides the standard;
however, substantial compliance with the code is sufficient so long
as habitability is not affected.
Common Law

In some jurisdictions, the standard for the implied warranty is


found in the common law, even in the absence of a housing code.
In those jurisdictions, a breach of the warranty may be found if the
premises are uninhabitable in the view of a reasonable person.

Property I Slides

246

Implied Warranty of Habitability

Procedure: To claim a breach of the implied warranty of habitability,


the lessee must
First provide the lessor with notice of the defect, and
Then allow the lessor a reasonable time to make necessary
repairs.
Effect of Breach on Lease
The tenant is excused from further performance under the lease.
The tenant may but need not vacate the premises.

Property I Slides

247

Implied Warranty of Habitability

Remedies Available
The tenant may treat the lease as cancelled, and rent is abated.
The tenant may also seek money damages.
Hilder
The Hilder court used the contract measure of damages
for breach of warranty, which is the value of the premises
as warranted less the value of the premises as received.
Agreed rent is evidence of the rental as warranted.
Other jurisdictions use the following measure of damages: the
agreed rent minus the fair rental value of the of the premises
received.
In addition, the tenant may seek reformation or other traditional
contract or tort remedies.

Property I Slides

248

Premises Liability
Liability of Lessors

A lessor is not liable to the lessee, or others on the premises with the
consent of the lessee, for injuries caused by a condition of the premises,
except in the following situations:
A undisclosed dangerous condition exists that is known or should
have been known to the lessor but is unknown to the lessee.
A condition exists that is dangerous to persons outside of the
premises.
The premises are leased for admission to the public.
Parts of land are retained in the lessors control but are available for
use by the lessee.
The lessor has contracted to repair.
The lessor has been negligent in making repairs.

Property I Slides

249

Lessees Duties: Rent

250

A lessee has a duty to pay rent.


Destruction of the Premises
Common Law Estate Theory
Under the common law estate theory, the lessees duty to
pay rent is not relieved if the premises were destroyed.
Exceptions to the Common Law Rule: In some jurisdictions in
the United States, if the premises are destroyed, the lessee
may be relieved from the duty to pay rent if
The tenant leased a portion of a building only, or
The tenant leased a building without accompanying land.

Property Slides

Lessees Duties: Repairs

251

Common Law Estate Theory


Under the common law estate theory, the landlord has no duty
to repair the premises during the term of the lease.
Under the common law estate theory, the lessee has a duty
not to commit waste, which includes a duty to repair the
premises (permissive waste).
The lessees duties in respect to waste are similar to those
owed by life tenants.

Property Slides

Lessees Duties: Repairs

252

Under the duty to avoid permissive waste,


The tenant has an implied duty to make minor repairs, which
keep the building wind tight and water tight.
However, the tenant does not have a duty to make major
repairs or to rebuild the premises if they are destroyed.
The lessee's duty not to commit permissive waste (primarily in
respect to repairs) is not limited to the extent of income derived
or reasonable rental value when the lessee possesses
personally.
In addition, a lessee (except possibly a tenant for a long term)
may not commit ameliorative waste (which a life tenant may do).

Property Slides

Lessees Duties: Repairs

253

Express Covenant to Repair


The tenant may covenant to repair the premises.
Usually, this covenant excepts ordinary wear and tear.
The covenant may also except damage by acts of God, such as fire.
If the tenant covenants to repair without exception,
The tenant must make all repairs, regardless of how the damage is
caused.
Traditionally, the tenant is required to rebuild if the premises are
destroyed, even if the destruction was not the tenants fault.
Under the minority view, the tenant is not required to rebuild if the
destruction was not her fault.

Property Slides

Lessees Duties: Statutory

254

Statutory Duties: In most states, the lessee also has duties assigned
by statute, such as the duty to keep the premises clean.
Florida Statutory Duties (F.S.A. 83.52): In Florida, the tenant has
the following statutory duties:
Comply with the health code.
Keep the premises clean.
Remove garbage.
Keep plumbing in good repair.
Use plumbing and electrical equipment in a sage manner.
Not destroy the premises.
Not disturb neighbors.

Property Slides

Lessors Duties: Statutory

255

Florida Statutory Duties (F.S.A. 83.51): In Florida, the lessor has


the following statutory duties:
Extermination.
Locks and keys.
Clean and safe common areas.
Garbage removal.
Heat, running water, and hot water.
The lessor is also responsible for repairs to the structure (e.g., roof
repairs).

Property Slides