ACQUISITION OF

REALTY
ACQUISITION OF REALTY

Real property and real property rights

may be transferred by several means.
These include an outright grant, a
reservation within a grant that splits one
parcel of land from another or certain
rights from such land, and by other
means. These means of acquisition are
discussed in this section.
 GRANT

 The most common form of acquisition of real

property. It may be part of a bequest of a will, or
as a matter of law when the former landowner
dies intestate ( without a will ), or as a result of a
gift or agreement of purchase and sale.
 It is covered by the statute of frauds, and thus
must be in writing by the grantor.
 REVERSION

 In the case of a grant of a life estate or estate of

years, ownership of the property will be made
automatically by revision. Unfortunately,
individuals living on the premises may not leave
automatically, and the trend of the courts
appears to have shifted the burden of acquiring
possession to the remainderman.
 RESERVATION

 It refers to a clause in a deed in which the

original property owner retains some right or
portion of the property, such as an easement or
mineral rights.
ADVERSE POSSESSION

 Adverse possession is the process whereby title to

another person’s real property is acquired
without compensation by holding the property in
a manner that conflicts with the true owner’s
rights for a specified period of time.
MORTGAGES

 A mortgage contract between debtor and creditor

affords the creditor, by way of a security against
the outsatanding debt, a charge upon the land of
the debtor.
 A mortgage is a debt instrument, secured by
the collateral of specified real estate property,
that the borrower is obliged to pay back with a
predetermined set of payments. Mortgages are
used by individuals and businesses to make large
real purchases without paying the entire value of
the purchase up front.
 Mortgagor – the debtor
 Mortgagee’s – the creditor

If the mortgagor fails to fulfill his mortgagge

commitments, the mortgagee’s usual resource is
to invoke the judicial proceeding known as
“ Foreclosure “.
LANDLORD/ TENANT RELATIONSHIP

The ownership and the right of possession

may be split. Where the right to
possession is provided for a specified
period of time, two classes of ownership
are created, that of the LANDLORD and
that of the TENANT. A lease typically
controls the rights of these two parties.
LEASE

 Lease or rental of realty is a contractual

arrangement between two parties designated in
common parlance as landlord and tenant,
whereby the owner divests herself for a period of
time of the possession and use of his property in
exchange for a stipulated compensation in the
form of rent.
 A covenant is an undertaking to do, or, in the
case of a negative covenant, not to do, a stated
act. Certain covenants are implied in every lease.
These include a covenant by the tenant to pay
rent, and covenants by the landlords:

1. That he has title to the property

2. that the tenant will have “ quiet enjoyment “ of
the premises.
3. Covenant is breached by eviction, actual or
constructive.
 An oral lease for more than a year is usually
unenforceable under the statute of frauds. A
lease of appreciable duration should be recorded
so as to give the prospective purchasers of the
property notice of the situation.

 Estate for years. The primary attribute of an

estate for years is that it ends automatically at
the expiration of the stated period.
 Periodic tenancy. The primary attribute of a
periodic tenancy is that it will renew
automatically fro period to period, until notice is
given by either side of a desire to end or modify
the lease.
 Tenancy at Will. The primary attribute of a
tenancy is that it is for an indeterminate period
of time while either party may give notice at any
time of the termination of the tenancy.

 Tenancy at Sufferance. If a tenant fails to

leave at the end of her lease, but the landlord
has not yet commenced an action of ejectment,
the situation is understood to be a tenancy at
sufferance.
DUTIES OF LANDLORD
 No Duty of Usability. Absent language in the
lease, or as provided by statute, a landlord does
not warrant the usability of the subject property
for an intended use or for any use.

 No Duty to Repair. Similarly, unless required

by a lease or by local statute, the landlord has no
duty to repair the premises.
 Duties to Residential Tenants. Most states
have statutes controlling minimum terms in
residential leases, and thus requiring that a
landlord warrant that premises are heritable and
free of building of code violations.

 Duty to Disclose Latent Defect. The landlord

is responsible for disclosure of latent defects are
not casually visible, or many cases not visible at
all, the question arises how the landlord can
disclose these effects.
 Duty to Maintain Common Ares. Where the
lease premises are serviced by a common
walkway, stairway, corridors, or other common
element. It is presumed that the landlord is
impossible to maintain such in a good repair.

 Assumption of Repair. If the landlord assumed

the obligation of repairs, the consequential
damages due to failing in that obligation.

 Public Use .Landlords are not normally

responsible for the tidiness, cleansing .
DUTIES OF TENANT

 To provide a safe environment to business

visitors, social guests, and even trespassers.
 To pay rent to the landlord.

 To maintain the premises in the same condition

as received, less normal wear and tear.
 To provide timely notice to the landlord of any
repairs for which the landlord is responsible.
MECHANICS OF TRANSFER OF TITLE
1. The signing of a contract of sale, which is an
agreement to buy, on the one hand, and to sell,
on the other, a given piece of property upon
terms stated.
2. Title search and mortgage arrangements by the
prospective purchaser.
3. The closing, wherein the vendor ( seller )
delivers a deed to the property in exchange for
payment of the agreed-upon consideration.
4. The recording of the deed and other documents
in the official land records at the situs of the
property.
CONTRACT OF SALE
A contract of sale is an executory contract for the
sale of realty. The contract of sale ordinarily
covers a number of points among them the
following:
 Full description of the property involved.
 Selling price and terms of the sale
 Determination of which party will pay for such
items as the water bill from the date of the
closing to the end of the current period for
which a bill is rendered.
 Statement about existing encumbrances or
restrictions of any sort affecting title.
 Statement about whether purchaser will
assume any mortgage that may be outstanding
or about what other disposition will made of
such obligation.
 Type of deed the seller will furnish.
 Escrow arrangements.
 Date and place for the official closing.
THE DEED

A deed is a written instrument by which the

grantor conveys to the grantee some interest,
right, or title in or to the real estate described in
the document. The purpose of the deed is to
declare the fact of conveyance and to stand as
evidence of the transfer of title. It represents the
act of but one of the parties, being signed only by
the grantor, and, unless a gift is intended, is
drawn in fulfilment of the grantor’s commitment
under a previous agreement with the grantee.
TWO TYPES OF DEEDS

 Warranty Deed. The buyer invariably wants

this kind of deed.
 Quitclaim Deed. By this form the grantor
turns over such title and interest as he may have
in the property but makes no promise whatever
in the nature of a covenant. A quitclaim deed
covering a piece of real estate does not purport to
convey anything more than the interest of the
grantor as it existed at the time the instrument
was executed.
SURVEYING AND BOUNDARY LAW

The most profound issue relating to what may be

determined to be the boundaries of a parcel of
real property again relates to the history of the
state in which the parcel is located. Thus, old
deed descriptions many surviving even to today,
may cite measurements to the location of a
landmark that has long been destroyed, such as
an old tree. Surveyors exert a great deal of effort
each year re-establishing exactly where, for
example, such tree formerly existed.
RECORDATION

 Recordation is a child of statue. At common law,

an individual may only buy what another owns.
Thus, the purchase of stolen goods does not
convey good title against the rightful owner.
 Two issues have led to legislation

 First is that it is difficult to truly know who is

the current owner of real property.
 Taxes upon real property are the most
important source of income to many
communities and it is important to know to
whom a tax bill should be sent.
 THREE TYPICAL SCENARIOS BASED UPON
STATUTE LANGUAGE

 Pure Notice
In a jurisdiction with a pure notice statute, if
a second purchaser buys the property prior to the
first purchaser recording the deed, the second
purchaser takes good title and the first is left
with only the right to sue the seller.
 Race Notice
In a jurisdiction with a race notice statute, if a
second purchaser buys the property prior to the
first purchaser recording the deed, the property
will be deemed owned by whoever gets to the
courthouse to record his or her deed first.
 Pure Race

In jurisdiction with a pure race statute, if a

second purchaser buys the property prior to
the first purchaser recording the deed, the
property will be deemed owned by whomever
gets to the courthouse to record his or her deed
first, just as in jurisdictions with a race notice
statute.
DEDICATION

 Dedication is any process, formal or otherwise,

by which a landowner intentionally sets his
property apart for public use. Property dedicated
for a particular purpose generally cannot be used
for another purpose and the use of the property
for purposes other than those for which it was
dedicated cannot be authorized by ordinance.
EMINENT DOMAIN

 The right of eminent domain enables the federal

and the state governments and those to whom
the power has been lawfully delegated to take
private property and appropriate it to public use.
The public use requirement once acted as a
serious constraint on this government action.