Beenish's Property Outline

8/7/2019 Beenish's Property Outline

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Beenishs Property Outline

I. Acquiring Property by Capture

a. Possession: it is not static and is sometimes used as a legal fiction because the property right promotes the interest

in the case and sometimes the community at large. Promotes peace and order in society

i. Rule of Capture. Actual possession is required to gain a property right in wild animals. Pierson v. Post

1. Actual Possession. Includes (a) physical possession, (b) mortal wounding and continuedpursuit and (c) trapping in nets.

ii. Constructive possession: punishes disruptive behavior, and is not tangible possession but it gives you a

right because there is a policy that the court wants to promote

b. Pierson v. Post First in time arguments

i. Post was originally hunting the fox and Pierson came in and killed the fox in the middle of his hunt

ii. Post should be able to have the fox because he was first in time to hunt, Pierson was first in time to

kill the fox and thus has a right to take the fox

iii. to gain ownership you can physically possess it, mortally pursue it or deprive it of its libertyiv. A hunter must either trap or mortally wound a wild animal in order to acquire title to it

c. Ratione soliconstructive possession, you are not physically holding the fox, but you have done enough and we

want to pretend that you have the rights to this fox, an owner owns anything on their land

i. designed to prevent trespass

d. Exceptions to rule of capture

i. CustomGhen v. Rich

1. whale of a case on customs

2. Big whaling industry in Massachusetts, the whales are killed, they sink to the bottom and inseveral days they float back up and someone finds themif the person who did not kill the

whale finds it, custom is to contact the person who shot it and the shooter usually gives the

finder a salvage fee.

3. here, Rich saw the whale, claims it as his own and auctions it off to the highest bidders

Ghen clearly wants it back

4. considered five factors for applying this custom

a. application must be extremely limited

b. long recognizedc. requires the only act of appropriation possible (meaning there is no other way to get

the whale)

d. necessary for survival of the businessif we dont give the whale based on this

custom then whaling will most likely stop

e. works well in practice

5. Title to a wild animal is acquired when a hunter apprehends the beast in accordance

with custom


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e. Malicious interference: Keeble v. Hickeringill

i. Defendant drove ducks away from plaintiffs decoy pond with gun shots in order to save the ducks.

1. a person may not maliciously prevent another from capturing wild animals in the

pursuit of his trade

2. HAD defendant set up his own duck decoy that would have been allowable because then

defendant is trying to make his own living

a. Ex. You start your own school and lure all the students away from another, it is

perfectly legal (good for you!) but if you stand on the road in front of the school with

a shotgun telling people not to come near, then there is action.

3. malicious interference is not allowed, but market competition is fair game.

f. Fugitive Resources

i. Courts have extended the rule of capture to fugitive resources because They are difficult to capture, and

have tendency to escape and share characteristics of wild animals

ii. There are other options other than the rule of capture, but it depends on what our policy goals are in using

the particular resources

II. Economic Theory of Property Rights

a. Externalities are costs that a user does not have to take into account in deciding how to use a resource

b. I own a factory and I gain $100 profit for every day that its operated, but there is $1000 of harm/day imposed on al

of my surrounding neighbors by pollution

i. This creates a net loss of $900 for the community, but I dont care because everyday I am getting richer

so will I continue to operate my factory? Yes because I am making money

ii. If my neighbors got together and offered me some money between $100 and $1000 (lets say $500/day not

to run the factory), thus I am gaining $500 rather than $100 and neighbors are only losing $500, and

everyone will now be better off but why dont they do that?

1. because I have no way of controlling my neighbor joe who decides to open up a similar

factory next door

2. plus trying to get people together is costly and time consuming, the $1000 may be dispersed

over 10,000 people and thus the damage is unnoticeable (this is transaction costs)

a. the Free rider problem, I dont need to bother to contribute, because everyone else

does so I dont have to

iii. if the cost of the transaction is going to outweigh the benefit of the transaction then no one is going to

engage in it

c. what if I own factory and all surrounding land? Thus I am gaining $100 but losing $1000 with a net loss of $900

thus I will not operate my factory

i. the consolidation of the ownership of the land forced me to take externalities into account when deciding

whether or not I want to own and operate my factory


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d. how are externalities related to the problem of common property?

i. Common property will be exploited but not cared for because there is no benefit in up keeping communal

property

ii. The loss to the community is spread out to everybody and I am not forced to take that loss into account

because I am not directly baring the cost

iii. When property is private, the losses directly effect them, and I directly weigh whether it is worth it to

drain, pollute, etc.

iv. Free-riders and hold-outs (if one person in the community refuses to agree to the idea which the

community puts forth to benefit everyone)

e. In what two ways does private property reduce the problem of common property?

i. People who own land privately will use the land more efficiently because the cost directly effects them

ii. Reduction in transaction costs and costs in negotiating

f. American Indians is used to illustrate his point

i. Hunting land is common property so what happens when fur is no longer valuable?

1. when Europeans come over and offer $10/fur, the resource is greatly drained because there is

an incredible incentive to hunting whereas before it was simply for survival purposes

g. bottom line: common property=over-exploitation!!

i. Benefits of private property: higher concentration of costs and benefits, and reduced transaction costs

BUT I dont care about my neighbors until someone forces me to

h. What solutions, other than privatization, can help address the problem of the commons (aka stuff that we cant

possibly privatization such as oceans at atmosphere)?

i. Create legislation, make them government property, bring it to the attention of the people, impose tort

liability and force you to assume externalities via nuisance, etc.

i. Whats the point of all this?

i. In every case, we have to ask whether or not the answer is privatization, tort liability, criminal and civil

law, government entities

III. Theory of property rights

a. International News Service v. Associated Press

i. Where a company has expended resources in creating news and information, the creator can exclude

others from copying it until its commercial value as news has passed away

ii. INS was stealing APs news

1. Issue: Should INS be allowed to take news found in Associated Press bulletins and resell it

on their own for profit?

iii. The trial court issue injunction on points I and ii but not the copying news as unfair trade practice because

it was a novel issue to the court

iv. News isnt creation of a writer but a report of an occurrence


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v. News is public property, but it is a different story when people make it a business

vi. While it is normal for western cities to take news from the east, that still does not make it okay to

admittedly take news which others worked hard to accumulate and turn it over for a profit for yourself

vii. the question of the court is more unfair competition of business rather than copyright law on news

viii. holding: AP can exclude others from copying it until the commercial value is gone

1. news is quasi-property between competitors in the news distribution business

2. court wants there to be economic incentive for AP to continue publishing its news

3. if they didnt give AP rights then they may stop their service

ix. INS holding: as between competitors in the news distribution business, news will be treated as quasi-

property such that copying the news will constitute unfair business competition

b. Cheney Bros. v. Doris Silk

i. Doris Silk Corp. copied a fashion design from Cheney Brothers, and all the designs had a short life

ii. Unless the common law or the patent or copyright statutes give protection from appropriation, a

persons property interest is limited to the chattels which embody his creations

c. Smith v. Chanel

i. Chanel No. 5 was copied by Smith who sold it at a cheaper price, court ruled in favor of Smith claiming

that imitation is the lifeblood of competition

1. encouraging copying increases competition and improves the quality of products while

driving the costs down

ii. what accounts for the conflicting results in Smith and Cheney on the one hand, and INS on the other?

1. Smith is relying on utilitarian theory

a. The lower court was relying on natural rights and had ruled in favor of Chanel (John

Lockes labor theory)competitors should not be able to take a free ride

iii. INS was focusing on fairness arguments, but Smith and Cheney were focusing on efficiency arguments

1. Chanel should have had their product patented

d. Competition v. Monopoly

i. IP cases reflect tension between desire to stimulate creation by awarding monopoly rights versus the desire

to reduce the cost and increase the quality of goods through competition

1. if I couldnt afford chanel, I should be able to get chanel knock-offs

ii. congress struggles with this problem and are embodied in our statutes of copyrights

iii. Intellectual Property Rights

1. patents

a. they are for non-obvious processes, machines and inventions

b. give the holder an exclusive right to create the product for 20 years after the

invention was created and after 20 years the patent cant be renewed, which sends


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pharmaceutical companies in a tizzy because their expensive drugs are now going

to be recreated

2. copyrights

a. protect the expression of an idea

b. now they are automatic, as soon as you express an idea and they last the life of a

creator plus 70 years

c. allowed fair use exception which allows certain excerpts to be used

d. why are copyrights so much longer?

i. Because often ideas are inherent in the creator, there is usually a greater need

for goods under patent or inventions then there are the written word or ideas

3. trademarks

a. words or symbols associated with a product (cheerios, coke)

i. protects the mark not the products themselves

b. last indefinitely unless the mark or the name becomes so associated with that product

that people cannot advertise their own product without using the name (ex. Xerox)

e. White v. Samsung Electronics

i. Vanna White sues and wins because Samsung used a commercial that portrayed a blonde robot in front of

a wheel of fortune game board because they should not be allowed to use anything that will remind people

of her (violates her right of publicity)

ii. We have the dissent who felt it was ridiculous to let Vanna win

1. it wasnt even supposed to be her because it was 2020 and a robotclearly the robot had

taken her job!

2. limiting the right to parody is preventing free speech under the first amendment

3. hard to determine what does and does not exactly remind others of someones likeness

a. limits peoples creativity

b. you cannot control peoples thoughts and ideas

c. maybe it is ABCs right because they created the characternot Vanna

4. intellectual property rights are exposed at the expense of the future and therefore is a careful

balance between the owner and the public domain

f. MGM v. Grokster Ltd.

i. MGM was suing the owners of Morpheus who used p2p network instead of one large source

ii. Court ruled that it was complete copyright infringement because it was impossible for MGM to go after

every person that stole off of morpheus thus imposed liability on the software distributor

1. they needed to show that they had knowledge that their program was being used for illegal

copyright infringementsince they didnt deny that they knew it so they are held accountable


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2. Grokster went out there and attempted to gain customers with the knowledge that they were

going to get said customers who were more likely than not going to use the software for

illegal means

IV. Limits to property right

a. Moore v. Regents of Univ. of CA

i. A doctor has a duty to disclose the extent of his research and economic interests in a patients body

parts. Human body parts are not property such that they may be converted

1. Mos cell line is so legally and factually different from his cells that it cannot be considered

him

2. Product of human ingenuity, not naturebut do these arguments even pose a relevant case?

He doesnt want the patent, he wants the property rights

ii. 3 reasons that there is no liability now

1. no case law in point

2. statute limits Moores rights so whats left over cant be considered property

3. cell line cant be his property because is legally and factually different

iii. 3 reasons not to extend liability

1. fair balancing of policy considerations

a. patients right to autonomy v. threatening researchers with civil liability because cells

they do research on were taken without consent

b. duty to disclose will not hinder scientific research

c. could solve the problem by having a consent form be attached with

2. problems in this area are better suited to legislative resolutions

3. duty to disclose adequately protects Moore and patients like him

b. Jacque v. Steenberg Homes, Inc

i. Defendant was delivering a mobile home but the path that he needed to take was impassible (snow storm).

Defendant asked plaintiff if he could go through his land because of this reason and plaintiff said no,

defendant did it anyway, plaintiff sued for intentional trespass

1. jury awarded $1 nominal damages and $100,000 punitive damages

a. court invalidated jury award

2. supreme court decided to reinstate the $100,000 because the right to not have others cross

your land is meaningless is government does not enforce itotherwise people may resort to

self-help remedies (shooting at trespassers or other violent or dangerous backlashes).

Punitive damages may be imposed for intentional trespass to property

c. State v. Shack

i. Defendants went on land to speak to migrant farm workers about their rights (one for medical reasons and

one for political) landowner refused to let them on his land without his supervision


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ii. Defendants were convicted of trespass but was overturned

1. established that government workers have a right to access migrant farm-workers (case was

picked to establish this precedent)

2. migrant workers are not slaves to the landowners

iii. property rights may not be exercised so as to endanger the well-being of others

d. government limitation on right to exclude (firefighters, civil rights workers)

i. there are certain people who are allowed to trespass for the good of society (usually it is of necessity)

ii. economic argument against limiting the right to exclude

1. limiting the right to exclude would be bad for the farmer because the the workers will refuse

to work there and then the farmer will be SOL for the season because he chose to exclude

iii. government will not let migrant workers contract to waive their right to this government aidmostly

because they will be unaware of what they are giving away

V. adverse possession (AP)

a. adverse possession is a means of acquiring title to real property through possession for a statutory period

b. If someone abandoned their property and someone has been using it, it encourages economic efficiency to give him

some rights to it

i. You cant sue forever, theres a SOL and youll lose your rights when that is over

c. Earning theory

i. Reward the adverse possessor for his possession

1. we think that he is being efficient and making good use of this land

2. he has developed legit expectations over the coarse of statutory period

d. sleeping theory

i. penalize the owner for sleeping on his rights

1. you had 20 years to make a case and didnt do it. By failing to do so you let the other person

rely on these expectations

ii. SOL

1. Procedural role that adverse possession plays

2. documents get lost, people die

iii. marketability of title

1. want to make sure people can transfer it, etc and we need to be able to do this by making sure

that you own it

2. adverse possession helps acquiring title after long periods of use

e. elements of adverse possession

i. an actual entry giving exclusive possession

ii. that is open and notorious (meaning actual knowledge thereofthe person who actually owns the

property is fully aware of what you are doingif its a tiny steal15 inchesyou have to tell them if you


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are aware that you are doing itbut if your taking 30 acres, its big enough that the mere act of taking it is

informative enough)

iii. adverse/hostile and under a claim of right/title

1. adversity is without the owners permission, some courts require intent (this is where the three

intent theories come into play: subjective, good faith and adverse trespasser)

iv. and continuous for the statutory period

1. every state has different elements and most often courts are going to interpret traditional

elements (so one of these may not be used)

f. Van Valkenburgh v. Lutz

i. The Lutzs occupied the Van Valkenburghs land by building a one bedroom shack on it, by cultivating a

garden on it, and storing rubbish on it. In another action to establish the right of way across the land, the

Lutzes admitted that the land belonged to the Van Valkenburghs

ii. In order to acquire title by adverse possession, possession must be actual, it must be under claim of

title, and the land must be either enclosed or sufficiently improved

iii. Which elements of adverse possession are at issue in the present case?

1. actual entry

a. the general standard is the use that an ordinary true owner would make of the

property so that other third parties would know that this person has control of the

property (ordinary use)

2. claim of right

a. main requirement is that you not be acting with consent of the owner because if you

werent it would not permit hostility (cant be hostile if the owner allowed you)

i. we dont want to lull the owner into permission, and then 10 years down the

line AP is claimed

iv. adversity/claim of title requirement (court claims there are three different tests):

1. objective intent: we dont care what the AP was thinking, we just care what his actions were

and if they were enough to give the third parties notice of the claim

2. good faith test: AP has to think that it was his when he used it

3. aggressive trespasser: AP has to think that he did not own it but intended to make it his own

anyway

g. color of title

i. claim that is founded on a written instrument (a deed or a will) but is somehow ineffective

ii. when you claim AP, you may be able to get title to everything that is on the deed if u had constructive

possession

iii. actual possession of part of the land that is deceived in the faulty deed will give you title of all of the land

on the faulty deed


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iv. historically they came into play in the west because you couldnt know who had faulty deeds and who was

swindled and who owns what

h. Mannillo v. Gorski

i. Defendant made improvements on their home shortly after they bought it, they did not know, but it

encroached onto the plaintiffs land by 15 inches

ii. New Jersey law stated that if you do not use your property for the first twenty years, it is up for grabs after

that (sol runs out)

1. the main doctrine, however, is that your intent must be absolute and a mistake that it is your

property doesnt fly

a. it must be intent to claim (hostile)close to aggressive trespasser, but a slight

difference

b. courts criticize this doctrine because it rewards people that lie and claim that it was

not a mistake when it actually was

2. the court rejects this doctrine and takes the French doctrine that says all that is required is and

actobjective intent is going to be adopted now instead

a. you dont have to have done it in bad faith

iii. possession need not be knowingly and intentionally hostile, but it must be notorious to give the true

owner actual or constructive notice of the encroachment

iv. instant improver doctrine: if you improve land believing that it is your own, then the true owner may, in

certain instances, be forced to sell you the improvement provided that the sale of the improvement does not

cause substantial harm to the rest of the property

1. What if you intentionally improved someone elses land on purpose?

a. Then you can be forced to remove the stairs or sell the stairs to the true owner

b. Thus in this case there is a liability rule

i. Howard v. Kunto

i. first owner of the property built house on the property adjacent to the land he actually owned, the guy who

owned that land did likewise, as did the guy next to that guy (so three houses were improperly shifted over

1 lot)


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ii. two issues: tacking (can the former residents time tack on to the time which the current owners spent at

the house1 year) and the question of whether or not being there only the summers counts as continuous

use?

1. Court ruled that the property was used continuously and that tacking was allowed

a. Occupancy during the summer months for more than a 10 year period is considered

continuous because there had been improvements to the land and it seemed a

guarantee that they homeowners would always come back each summer

iii. tacking is allowable when looking for adverse possession where there is privity between successive

occupants

1. privity is established by the deed (when the first owner transfers a deed to the second owner,

they have privity) in general privity means the relationship between two parties that have a

legal interest in somethingcan be piece of property or other things

2. The court expands the definition of privity by claiming that it can be established any time

there is a reasonable connection between successive occupants (much broader than regular

definition of privity)

a. For policy reasons

i. If someone is in good faith on the land for a long time then you shouldnt

disrupt it (because the Kuntos may sue their neighbors and so on, etc.)

ii. cost savings: tremendously expensive to require owners to do a survey of the

land prior to purchase

iv. suppose that instead of building a home, the Kuntos used the lot each summer for camping, at the end of

the summer, the Kunots packed their camp and left no trace of their use.

1. This would not satisfy continuity because they would not have made any improvements

(there was no way of even knowing that the campers had been there)

j. Disability Statute

i. an action to recover the title to or possession of real property shall be brought within 21 years after the

cause thereof accrued, but if a person entitled to bring such action, at the time the cause of actions accrues,

is within the age of minority, of unsound mind, or imprisoned, such person [or anyone claiming from by or

under such person], after the expiration of 21 years from the time the cause of action accrues, may bring

such action within 10 years after such disability is removed

ii. if owner was imprisoned on the day the AP entered, the AP is barred from legally taking the land

1. BUT if the guy was imprisoned two years after the AP entered, the AP can claim title because

hes not covered by imprisonment

iii. you also cannot tack on disabilities

1. if a 15 year old owns and then goes to prison, his disability ends at 28 years old (10 years

after the disability ends)


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a. BUT it can also be when hes 46 years old because thats 21 years after the cause of

action was started while he was a minor

iv. so its either 10 years after the disability is removed or 21 years from when the thing occurredwhichever

one is longer is what the person with the disability gets

1. The owner, representative of owner, or guardian of owner can suek. Review of AP

i. Elements:

1. Actual Entry giving Exclusive Possession

a. Consistent with ordinary use of similar property (Van Valkenburgh Dissent)

2. Open and notorious

a. Caves (Marengo)

b. Minor encroachments (Manillo)

3. Adverse/Hostile/Under Claim of Right/Title

a. Without owners permission

b. Consider required intent (Van Valkenburgh, Manillo)

4. Continuous

a. Seasonal use permitted (Howard)

b. Tacking requires privity, i.e. reasonable connection between possessors (Howard)

5. Boundary Disputes look to see if any of these doctrines are applicable

a. Doctrine of Agreed Boundaries

b. Doctrine of Acquiescence

c. Doctrine of Estoppel

6. Color of Title

a. Claim pursuant to faulty written instrument

b. Constructive APyou can get the part of the property which you constructively

owned under AP

c. Not a requirement of AP but gives you a benefit

7. Disabilities

a. Must exist when cause of action accrues

b. Extended S/L

VI. Acquisition by gift

a. Elements

i. Delivery

1. physical delivery

2. constructive delivery

a. giving someone something that opens or turns the object on (keys to a car)


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3. symbolic delivery

a. when the item is to large to actually hand over (i.e. deed to land)

ii. intent

iii. acceptance

b. Newman v. Bost

i. Newman was promised by the decedent all the furniture in the house, handed her keys and told her it was

hers when he died.

ii. The bureau contained his life insurance policy, however, and she claimed to be entitled to the insurance

policy because it was in the bureau

iii. Court says that the first two items are gifts causa mortis (given in comptemplation of impending death

and if u live it is automatically revoked) and the second two is inter vivos (gifts in life)

iv. Symbolic delivery of a gift is not effective. Constructive delivery is allowed only when it is

impractical to deliver actual possession

1. where manual delivery is possible, you have to do it

a. life insurance policy had to be delivered

c. Gruen v. Gruen

i. Older Gruen wanted to give son a famous painting upon his death, but for tax reasons simply said happy

birthday, my gift to you is this painting which made no mention of the give being given inter vivos

1. but the first letter was an inter vivos gift but the dad asked the son to destroy the first letter

which he did

ii. a party may give a future interest in chattels as a gift while reserving a life estate in himself

iii. when dad died, 4th wife (the ex-maid) wanted the $2.5 mil painting for herself

VII. Estates in Land

a. Estate defined

i. An estate is an interest in land which:

1. either is or may become possessory and

2. is measured by some period of time (even if indefinitely)

ii. present interests (or possessory) gives its holder the right to possess land right now

iii. future interest gives its holder the right to possess land in the future

1. not that the interest itself is in the future, but its the right to actually have it in the future

iv. allows the owner to control how the land is going to be used in the future and what rights the current

possessor has

b. Must know for each estate:

i. The durations of the estate

ii. Creation (i.e. what words do you need in order to create the estate)

iii. Transferability


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iv. What future interests follow the estate?

c. Order of intestate descent

i. If you die intestate (without a will), your property will pass through the states intestate statute to:

1. spousestates vary on what % goes to the spouse, and in most cases it depends on whether

or not there are children

2. issue (lineal descendants)

a. i.e. my kids or if my children died, my grandchildren

i. (if mom dies me Marianne and Bob get her part)

3. ancestors (parents)

a. if I die, my stuff goes to mom

4. collateral relatives

a. if me mom and dad die, it goes to Marianne and Bob

5. escheat to the state

d. Fee Simple Absolute Defined

i. Fee

1. interest in land

ii. simple

1. ownership of unlimited duration

iii. absolute

1. no future interest that can cut off the ownership

iv. there are generally always limitations on your right to control your property and almost no one has fee

simple absolute

v. fee simple = fee simple absolute

vi. duration is infinite, no known reason at the time the estate is created why it should end

1. transfer options:

a. alienable (sellable)

b. devisable (passed through the will)

c. descendible (passed through intestacy if die w/o will)

2. future interest: none

a. no one has an interest after you (youve earned it absolutely)

e. Life estate

i. Duration: a life estate is an interest in land that lasts for the life of the holder or the life of a third party

(pur autre vie).

ii. Creation:

1. to A for life

2. to A for the life of B


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a. A has pur autre vie and B has nothingwhen B dies, the property goes back to the

original grantor

b. Can be passed through a will or intestate statute

iii. transferable: for the duration of measuring life

1. alienable

2. devisable

3. descendible

iv. Every life estate is followed by a future interest because when the life estate dies, the property has to go

somewhere

1. reversion: future interest in grantor

a. if O to A for life then A has a life estate and O has a reversion

2. remainder: future interest in transferee

a. if O to A for life, then to B, A has a life estate, B has a remainder in fee simpleOhas nothing

f. White v. Brown

i. Lide left the house to Evelyn White and told her she could not sell it, left her personal property to Sandra

White Perry

ii. Lide family tree

iii. I wish Evelyn White to have my house to live in and not to be sold1. is this a life estate or fee simple?

iv. Unless a contrary intention appears by the terms of the will and its context, a will conveys a testators

entire interest

1. the not to be sold clause was thus tossed, and she was given full rights

g. Law of Waste

i. It is applied whenever two or more persons have the right to possess property at the same time (ex: join

tenants), or consecutively (ex: life estate followed by future interest holder)


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ii. It is applied because it prevents one owner from using the property in a way that unreasonably interferes

with the expectations of other owners or future owners

iii. Types of waste

1. affirmative waste

a. removing all trees from property

b. storing nuclear waste on property

2. permissive waste

a. failing to pay taxes

b. failing to make reasonable repairs

iv. the first owner will probably depreciate the value of the land, goes back to Demsets idea in the tragedy of

the commons

1. whenever there is land owned by more than one person they are going to hurt all of the foxes

or use all of the oil

v. originally really stricthad an obligation to give the land to the future owner of the land exactly as you

got it

vi. life tenants are now allowed to make changes to the land provided that the value of the future interest is no

diminished by his actions

III. Defeasible Estates

a. A defeasible estate is a present interest in land that may end upon the happening of an event in the future

i. to A so long as the premises are used as an ice cream parlor

1. defeasible fee simple

a. the original grantor has the future interest

i. there are two options for future interest, it can be the grantor or the third

party

ii. to A for life, so long as the premises are used as an ice cream parlor

1. this is a defeasible life estate

iii. to A for 10 years, so long as the premises are used as an ice cream parlor

1. defeasible leasehold

b. Defeasible fees and future interest (FI)

i. A defeasible fee is always followed by a future interest

1. FI in grantor: to A so long as the premises are used as an ice cream parlor

2. FI in Grantee: to A so long as the premises are used as an ice cream parlor, then to B

a. We specify what happens if A breaches the condition

c. Questions asked:

i. Who is the holder?

ii. What is the future interest in these estates? This can be the original owner or a 3rd party


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d. Any estate can be made defeasible, but the most common is a defeasible fee simple

i. Fee simple determinable (FSD)

ii. Fee simple subject to a condition subsequent (FSSCS)

iii. Fee simple subject to executory limitation (FSSEL)

e. Fee simple determinablei. FSD is a fee simple that will terminate automatically when a stated event occurs

1. Fred gives Greenacre to Lucy so long as Greenacres is used for residential purposes

ii. This is upon happening of stated event

1. automatic transfer of interest

2. From Lucy to Fred if it stops being used for residential purposes

a. Goes back to the original grantor

iii. FSD and future interest

1. FSD is always followed by the possibility of reverter to grantora. Fred gives Greenacre to Lucy so long as Greenacre is used for residential purposes

b. Present estate: Lucy has a Fee simple determinable

c. Future interest: Fred has a possibility of reverter

2. Explicit

a. Fred to Lucy during the time that she uses the property for farming, otherwise to

revert to grantor

3. implied


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a. fred to lucy so long as no liquor is served on the property

iv. must use clear durational language, if the state condition is violated, the forfeiture is automatic and if the

condition is violated the future interest is the possibility of reverter in the grantor

v. Transferability

1. FSD is alienable, devisable and descendible, but always subject to the condition

a. Fred gives Greenacre to Lucy so long as no liquor is served on the property

i. Lucy has a fee simple determinable

ii. Fred has a possibility of reverter

b. what happens if lucy sells Greenacre to mike?

i. If mike opened a bar on Greenacre, the future interest would automatically

invest the property would go to the original owner

1. lucy does not have the right to sell liquor on the property so she does

not have the ability to sell to him for this purpose

f. Fee Simple Subject to Condition Subsequent

i. FSSCS is a fee simple that is contingent upon meeting a condition; upon violation of condition there is no

automatic transfer of interest. Grantor must affirmatively exercise right to repossess.

1. estate can go on forever because he may come onto the land, but this poses the threat of AP

by the owners

ii. You have to force the person off!

1. Fred to Lucy on the conditionthat the property be used for residential purposes; in the event

it is not so used, Fred shall have a right of entry.iii. FSSCS and Future Interest

1. FSSCS is always followed by a Right of Entry in the Grantor

2. Fred to Lucy on the condition that the property be used for residential purposes; in the event

it is not so used, Fred shall have a right of entry.

a. Future Interest: Fred (Grantor) has a right of entry

b. Present Interest: Lucy has a fee simple subject to condition subsequent

3. Right of Entry can be explicit or implicit in grant.

iv. Transferability1. like FSD, FSSCS is alienable, devisable and descendible, but always subject to the condition

g. Fee simple subject to executory limitation

i. FSSEL is a fee simple that terminates automatically upon the violation of a condition (like FSD) and

passes to a third party (unlike FSD and FSSCS)

1. to Lucy, but if Blackacre is ever used as factor, then to Mike

ii. FSSEL and future interest

1. FSSEL is always followed by an executory interest in a transferee named in the grant


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2. to Lucy, but if Blackacre is ever used as a factory, then to Mike

a. Present interest: Lucy has a fee simple subject to executory limitation

b. Future interest: Mike has an executory interest (there is no more condition once it

gets to Mike)

h. identifying defeasible estates

i. step 1: identify the future interest holder

1. if a third party, you have a FSSEL

2. if it is the grantor, you have a FSD or a FSSCS

ii. step 2: if the future interest holder is the grantor look for magic words

i. examples:

IX. Universe of Future Interest

a. In grantor

i. Reversion

ii. Possibility of reverter

iii. Right of entry

b. In third party

i. Remainder

1. vested remainder

a. indefeasible vested remainder

b. vested remainder subject to open or partial divestment

c. vested remainder subject to total divestment

2. contingent remainder

ii. executory interest

1. shifting executory interest

2. springing executory interest


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c. Reversion

i. Arises whenever O transfers less than his entire interest

ii. Follows a life estate or term of years

1. O to A for life

a. Present estate: A has a life estate

b. Future Interest: O has a reversion

2. O to A for life, then to B and her heirs if B survives A

a. Present estate: A has a life estate

b. Future estate: B has a remainder in fee simple, O has a reversion

d. Possibility of reverter

i. Possibility of reverter is the future interest in the grantor following a fee simple determinable

ii. O to town library so long as used for library purposes

1. present estate: Town library has a fee simple determinable

2. future interest: O has a possibility of reverter

e. Right of reentry

i. Right of reentry is the future interest in the grantor following a fee simple subject to condition subsequent

1. O to town library but if it ceases to use the land for library purposes, O has the right to

reenter and retake the premises.

a. Present estate: town library has FSSCS

b. Future interest: O has a right of reentry

X. Future interests in the grantor

a. Remainder

i. 3 requirements

1. held by a grantee


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2. capable of becoming immediately possessory (i.e. no condition precedent to take the land)

no space between life estate ending and the remaindermans possession

3. upon natural termination of prior estate (i.e. cannot follow a defeasible fee)

a. death of a life estate tenant or an expiration of a leasehold

b. a remainder can never follow a fee simple!!!

i. Because defeasible fees terminate unnaturally

b. Estates in remainder

i. Remainder in fee simple

1. O to A for life, then to b

ii. Remainder in life estate

1. O to A for life, then to B for life

iii. Remainder in FSD

1. O to A for life, then to B and his heirs as long as the white house stands

a. A has life estate

b. B has remainder in FSD as long as

c. O has possibility of reverter

iv. O to A for life, then to B

1. A has a life estate

2. B has a remainder

a. He has a remainder because he met all three requirements

v. O to A for life, then one year later, to B


2. B has an executory interest

a. Because it is not capable of possession immediately (violates 2nd requirement)

3. O has a reversion for that one year in between

vi. O conveys Blackacre to A for life, then to B if B gives A a proper funeral


2. B has an executory interest

a. Cant be remainder because it will take some amount of time for B to fulfill the

condition

c. Vested remainder

i. A remainder that (a) is in an ascertained person and (b) is not subject to any condition precedent

ii. Three types

1. indefeasibly vested remainder

a. remainder that is certain to become possessory in a particular person

i. to A for life, then to B and his heirs


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1. present estate: A has a life estate

2. future estate: B has an (indefeasibly) vested remainder in fee simple

2. vested remainder subject to open (or partial divestment)

a. remainder in a class of persons that is certain to become possessory in at least one

class member, but that may be diluted by the inclusion of additional class members

b. O conveys to A for life, then to As children A has 1 child, C.

i. Future interest: C has a vested remainder subject to open in fee simple

1. vested because C is an ascertained person and there is no condition

precedent to C taking

2. subject to open because A might have more children

c. what if A had no children at the time of the grant?

i. That would be a contingent remainder because it would be contingent on

them being born

ii. When she does give birth, it would become a vested remainder subject to

open

iii. Rules for class gifts

1. Vesting: class gift vests when one member of the class can be identified

a. example: gift to As children vests as soon as A has a child

2. closing: class closes pursuant to the

a. fertile octogenarian rule

i. a class of children doesnt close until the parents die

b. rule of convenience

i. a class will close when the remainder becomes possessory for any one

member

ii. its when the child can actually take possession of the estate

c. O to A for life, then to Bs children

i. B is alive and has one child, C

ii. A has life estate

iii. Bs children have a vested remainder subject to open

iv. Under first rule, class stays open until B dies because more children can be

added

v. If A dies before B, the class is closed and C can take the estate

d. if B is alive and has no children

i. it would be contingent remainder because it is contingent upon B having

children

ii. once B has a kid, its a vested remainder subject to open


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iii. if B never has a kid, it reverts back to O

iv. Vested remainder subject to divestment (or executory limitation or defeasance)

a. Subject to a condition which may divest it in the future

b. Remainder that will become possessory, unless some event occurs which divests the

remainderman of its interest

c. To A for life, then to B and her heirs, but if B does not graduate law school, then to C

i. A has a life estate

ii. B has a vested remainder subject to divestment in fee simple

1. B gets property until he dies because he has opportunity to complete

law school until his death, and when he completes it hes free and

clear (if he doesnt C gets it at his death)

iii. C has an executory interest

d. Because the condition comes after then to B and her heirs, it is vested

d. Contingent remainder

i. A remainder that is either (a) in an unascertained person or (b) subject to a condition precedent

ii. Remainder in unascertained person

1. to A for life, then to Bs children. B has no children

a. A has a life estate

b. Bs children have a contingent remainder (because they are unborn and therefore

cannot be ascertained)

c. O has a reversion (in case B dies without ever giving birth)

2. to A for life, then to Bs heirs


b. B has contingent remainder because you do not know who the heirs are yet if B is

dead, if B is dead, theyd have a vested remainder

3. O to A for life, then to the person who is then president of the US


b. President has a contingent remainder

iii. Remainder subject to a condition precedent

1. is not guaranteed to naturally occur, and must happen before taking of the estate

2. condition precedent=condition that precedes the remainder or is woven into the grant of the

remainder

3. To A for life, then, if B graduates from college, to B


b. B has a contingent remainder (subject to the condition precedent that B graduate from

college)


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c. O has a reversion (in case B does not satisfy the condition precedent prior to the

termination of the present estate)

d. What if the life estate ends and B has not yet graduated college? It will revert back to

O (O has a reversion)

i. He must fulfill the condition before he takes possession of the land

ii. In some states, O gets the reversion, but then B has an executory interest

until he graduates college

e. Classifying remainders

i. If a condition follows the granting language, the remainder is a vested remainder subject to total

divestment

1. to A for life, then to B, but if B should fail to graduate from law school, then to C


b. B has a vested remainder subject to total divestment (condition follows grant, B take

possession immediately upon As death)

c. C has an executory interest (not a remainder because Cs FI will divest Bs

possessory estate)

d. O has nothing

ii. If a condition precedes or is part ofthe granting language, the remainder is a contingent remainder

1. to A for life, then to B if he graduates from law school, otherwise to C


b. B has a contingent remainder (condition is part of grant, B cannot take possession on

As death unless the condition is satisfied)

c. C has an alternative contingent remainder

d. O has a reversion

iii. Hint for classifying remainders following life estates:

1. LEcontingent remaindercontingent remainderreversion

2. LEvested remainder subject divestmentexecutory interestno reversion

iv. Default rule: vested remainders are preferred by the courts because the courts like to know where things

are goingf. Executory interest

i. An executory interest is a FI (a) in a third party (b) that is not a remainder and (c) that divests another

interest

ii. Follows a FSSEL or a vested remainder subject to divestment

iii. Shifting: divests a third party

1. idea is that it shifts from one transferee to another transferee

2. to A and her heirs, but if A does not graduate from law school, then to B and his heirs


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a. Present estate: FSSEL

b. Future interest: B has a shifting executory interest (if A does not graduate, Bs

executory interest will divest A of her FSSEL)

iv. Springing: divests the original grantor

1. O conveys to A when she marriesa. O has a FSSEL

b. A has a springing executory interest (when A marries her future interest will divest O

of his FSSEL)

g. Trusts: the overview

i. Estate system allows grantors to control use and ownership for a few generations into the future, giving

owners different ways to manage estates, but there are some disadvantages

1. knowing exactly who will own it in the future can be difficult

a. makes it hard to sell the property because you dont know who has interest in the

property

b. its kind of rigid in that it sets up the day the grantor gives the grant and then the

grantor cant really change it

i. grantor cant forsee what will happen in the future and this locked them in

ii. trusts solve a lot of these problems

1. the beneficial ownership is separated from the legal ownership

2. Trustee has legal title to Blackacre, and the beneficiary gets whatever income Blackacre

produces

a. Trustee is told how to divide everything and who gets what, hes also allowed to

change things as he sees fit as conditions change in the futuretrustee can sell it if

its for the good of the beneficiary

b. Problem of land being inalienable because you dont know who the owners are going

to be is resolved by trust

3. more flexible because you can divide things up by percentages (25% to A and 43% to B, if

my son loses his job he can have 10% more, etc.)

XI. The Rule of Perpetuities

a. The rule: No interest is good unless it must vest [and close], if at all, no later than 21 years [and 9 months] after

the death of some life in being at the creation of the interest

i. Vest and close= relates to class gifts and makes sure that the class is identified and takes control within the

time limit of the perpetuities period

ii. We must know that it will, eventually become possessory

iii. Anything that doesnt happen in this term is void


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b. Purpose is to prevent dead hand control: its inefficient and doesnt allow you to derive the full value from the

property you are currently in possession of (cant sell, cant disperse as you please)

c. 4 step approach to RAP problems:

i. Classify the future interest

ii. Identify the condition precedent to vesting

1. figure out what must happen in order for it to vest

iii. Find a validating life

iv. Determine whether the interest must vest or fail to vest within 21 years and 9 months of the validating life

1. if an interest is not certain to vest or fail, strike it from the grant

d. Step 1: Classifying future interest

i. Determine which future interest have been created by the conveyance

1. the RAP only applies to:

a. contingent remainders

b. executory interests

c. vested remainder subject to open

d. options and right of first refusal

2. the RAP doesnt apply to:

a. FI in grantor (reversion, right of re-entry, possibility of revertor)

b. Indefeasibly vested remainders

c. Vested remainders subject to divestment

ii. To A for life, then to As children

1. A is alive and has no children

a. As unborn children have a contingent remainder (subject to RAP)

e. Step 2: Identify the conditions precedent to the vesting of the suspect future interest

i. To A for life, then to As children

1. A must die (so the life estate can terminate) and

2. A must have children (so the FI holder is ascertained)

f. Step 3: Validating Life

i. Alive and relevant: look for a person alive at the date of the conveyance and ask whether the persons life

or death is relevant to whether the condition will occur

ii. A is a validating life because she is alive on the date of the conveyance and her death is directly related to

whether the condition will be satisfied (i.e. on As death we will immediately know whether A has any

children)

g. Step 4: Will we know with certainty w/I 21 years of the death of our validating life, if the interest will vest?

i. Upon As death we will know for certain whether A had any children and, therefore, whether the condition

precedent was satisfied


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ii. Thus, the contingent remainder does not violate the RAP

h. Vesting of Future Interest

i. When does a future interest vest?

1. Contingent remainders and executory interests vest when the condition precedent is satisfied.

2. Class gifts in vested remainder subject to open vest when

a. The class closes and

i. Fertile octogenarian rule

ii. Rule of convenience

b. All conditions are precedent for each class members interest is satisfied

i. All or nothing rule: if condition is not satisfied for one class member, gift is

void for the entire class

i. common perpetuities scenarios

i. A gift to an open class conditioned on the members surviving to an age beyond 21 violates the RAP

1. To A for life, then to such of As children as live to attain the age of 30. A is alive and

has two children, B and C. B is 35 and C is 40.

a. Classify the Interest: A has a life estate, B and C have a vested remainder subject to

open

b. Identify the Condition: Each of As children must live to 30.

c. Find a validating life: A, B or C (are alive and relevant)

d. Certain to vest? No. Assume A has another child, D, and then A, B and C are

killed. Gift to As children is not certain to vest in each member of the class because

D, an after born childof A, could reach 30 more than 21 years after the death of A,

B and C. Under the All or Nothing rule the gift is void for entire class.

ii. A shifting executory interest with no time limit violates the RAP

1. to A and his heirs so long as the land is used for school purposes, then to B and his heirs

a. classify interests

i. A has FSSEL

ii. B has a shifting executory interest

b. Identify condition: land stopped being used for school

c. Validating life

i. B or A

d. Certain to vest? No way do you know if theyll get it within 21 years of the death of

B or A that it will stop being used as a school

e. A now has a fee simple determinable: To A so long as the land is used for school

purposes

i. O has a possibility of reverter


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iii. to A, but if the land ceases to be used for school purposes, to B and his heirs.

1. B has a shifting executory interest (because it isnt natural so its not a remainder)

2. must strike out but ifto B thus you are only left with to A and A gets a fee simple

absolute

iv. how do you make it so that O can give it to A until he stops using it as a school?

1. give it to B as a fee simple who then gives it to A as a fee simple determinable (B has a

possibility of reverter)

-or-

2. give it to A as a fee simple determinable, and assign B the possibility of reverter

j. O, a teacher of property law, declares that she holds in trust $1000 for all members of my present property class

who are admitted to the bar. Is the gift good?

i. Classify the estate

1. O has FSSEL (she creates it in herself)

2. class members have springing executory interest because if the satisfy the condition, they are

taking the property away from O, the original grantor

ii. condition precedent:

1. closed class all have to be admitted to the bar

iii. validating life: teacher and all class members

iv. will the gift vest within the perpetuities period: when you die, we will know whether or not you were

admitted to the bar

k. what if O had put $1000 in trust for the first child of A who is admitted to the bar

i. O has FSSEL

ii. Kids have springing executory limitation

iii. Validating life are all alive kids, O or A

l. why are we learning this?

i. Bar exam and trusts and estates class

ii. Its the law in New York

m. Symphony Space v. Pergola Properties

i. Broadwest had both commercial and theater building in manhattan, wanted to sell it to the not for profit

symphony in order to get a break on taxes (the symphony then leased the rest of the building other than the

theater back to Broadwest)Broadwest sold Symphony to them for less than $12,000

ii. Broadwest paid $10 in consideration to keep open the option to re-purchase entire building, so long as

closing would occur in the given years specified

1. Broadwest wants it back and Symphony claims option to repurchase is void under RAP

iii. There is no exception to the rule against perpetuities for commercial option agreements

n. perpetuities reform


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i. several waves of reform over the past couple of years

ii. Cy Pres

1. reform the grantcourt has equitable power to reduce age contingencies or indicate who the

beneficiaries are when the grant has unascertainable persons

2. used in a couple of states

3. this has largely been rejected

iii. Wait and See

1. dont look at it immediately and see if it violated it when it was made, but see if it will be

valid at any point

2. Pergola wanted a wait and see because then they would have been fine

3. many states have adopted this because the what might happen leads to absurd results like

what if my 80 year old grandma has a childthings that are more likely than not to happen

iv. perpetual trusts

1. way to get around RAP

2. put your property in trust forever, as long as trustee has power to sell it, it wont violate the

RAP

3. can direct who owns it and where the income goes forever thus getting around RAP

XII. Concurrent Estates

a. Tenancy in commonBlackacre to A and B

i. Must haves:

1. Possession: each has an equal right to possess the whole

a. we both own parts of the house, but we have equal right to use the whole thing

2. Ownership: need not be equalcan be 60/40, 10/90, etc.

a. if you rent out shared house, you would split the proceeds in relation to percentage of

ownership interests

3. Transferable: alienable, devisable, descendible

a. Can pass down your part in a will, can sell it, or can pass through intestacy statute

but can never transfer more than what you own

4. Creditors: reachable by creditors

a. this is because it is transferable

ii. modern presumption is that property will be owned as tenancy in common if you are not told

b. Joint tenancy

i. If you want it to be a joint tenancy, you have to have expressed content to create it, like saying to A and B

as joint tenants or in some states specify clearer to A and B as joint tenants with right of survivorship

ii. Right of survivorship

1. when A and B are joint tenants, if A dies his interest goes to B


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iii. Requires 4 unities

1. timeeach must vest at the same time

2. titleboth have to acquire land from same person

3. interestmust be equal (cant be 40/60)

4. possessionright to possess the whole

iv. transferable: alienable but not devisable or descendible

v. creditors: reachable during life of tenant

1. can be reached while youre alive, but if they wait until you die they can no longer touch it

because you dont own it anymore

c. Tenancy by the entireties

i. Exists in about half the estates

ii. It cannot be conveyed to a third party

1. it has a 5th element added on to joint tenancy which is marriage

iii. Marital form: way that a husband and wife can own property together

d. Community property (not really a concurrent estate, but want to contrast it to them)

i. Exists only in 8 states and only between husband and wife

1. not a concurrent estate

e. intent plays a role when determining what estate is warranted!!

i. Doesnt have to be a joint tenancy just because you have 4 unities, can still be tenants in common

f. Blackacre to A, B and C as joint tenants

1. A conveys interest to D

2. B dies intestate, leaving H as his heir

ii. D and C would have state of title

1. its a joint tenancybut if youre in a state where it must say to joint tenants with right of

survivorship it wouldnt be and it would therefore be a tenancy in common, but here were

assuming its a joint tenancy

iii. D is a tenant in common when A conveys interest to him

1. B and C are joint tenants still, however

iv. C will own 2/3s (gets whatever B owned), D owns 1/3

v. What if this had been a tenancy in commonNOT a joint tenancy

1. D, B, and C, each own 1/3s, and when B dies, H, D and C are tenants in common

g. T devises Blackacre to A and B as joint tenants with rights of survivorship

i. This is clear joint tenancy

ii. If the owner creates a life estate with contingent remainder, you cannot get rid of the remainder, but if

there is right of survivorship, either party can sell their right of ownership


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1. so if you want them to have power to sell, give them joint tenancy, if you want them to be

stuck with it for a while, give them the life estate with remainder

h. Riddle v. Harmon

i. Mrs. Riddle did not want her husband to get their land automatically when she died, so she tried to sever

the joint tenancy without him

ii. if she conveyed to herself it would destroy the four unities

iii. she didnt use a strawman which was an understood 3rd party who you could convey your portion to and

then they immediately convey it back to youso you dont transfer it to yourself

1. the court ruled that you no longer have to use strawman because its outdated and redundant

you can create joint tenancy in yourself

iv. a joint tenant can unilaterally sever a joint tenancy without the sue of an intermediating third party

by conveying his or her property interest to himself or herself

i. should we allow joint tenancies to be severed in secret? (without giving notice or consent from the other joint

tenant)

i. conflicting interests

1. people should be able to do whatever they want, but it takes away the rights of one of the

parties

2. also is ripe for fraud

j. If both A & B die at the same time under a joint tenancy?

i. If it is not possible to determine who dies first the estate is split in half

k. Delfino v. Vealencis

i. Defendant has a trash removal building on the land which both plaintiff and defendant own as tenants in

common

ii. The plaintiff wanted to build on the land to create commercial property to rent out, but defendant wants to

prevent this because she has a business on the property and lives thereplaintiffs went to court to get a

partition by sale

iii. A mortgage does not sever a joint tenancy, and the surviving joint tenant takes the interest of a

deceased joint tenant without being encumbered by the mortgage

iv. supreme court rules that partition by sale is an extreme measure that goes against the idea that you are

legally allowed to control your own property

1. partition by sale is not the best option for the parties but a partition by kind would work

because it is a rectangular property easily divisible especially since there are only 2 of them

and theyll each get a fair size

a. the town allowed her to stay for years and gave her permits for her garbage business

(which her family had operated for years)unfair to make her give that up

v. two factors court looked at to see if you can divide land by kind


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1. whether it is practical

2. whether it serves the best interests of the parties

a. if these two prongs arent met, partition by sale may be the only way to go

vi. court gave them a partition in kind but made defendant pay plaintiff for the loss of profit because of the

garbage business

1. they then later cut her off from the main road and her business went under because they were

mean to him

l. Swartzbaugh v. Sampson

i. Mrs. Swartzbaugh (plaintiff) and her husband entered into a joint tenancy but then the husband leased part

of the land for a boxing pavilion

1. she never signed the lease and wants to cancel it

ii. court says that the lease is valid and binding and he had just as much right to make a lease as she did

1. there were some other remedies however:

a. action for partition of the land

i. but that wouldnt really help her much because he would still be able to run

boxing matches on his portion of the land

ii. if the boxing pavilion took up most of the land it would be impractical to

split it up

b. action for partition by sale

i. all you would get is half the present value of the leasehold interest

c. both of the above are not such great options

2. provoke an ouster

a. she can do something that makes his life so miserable that he kicks her outshe

would then get one half of the fair rental value

b. this is the best option for her

3. accounting

a. if the leasee is paying $10/month, she should get $5 from her husband

b. you want to get an accounting if the lease is higher than the fair market value

otherwise ud provoke an ouster

iii. a joint tenant, during the existence of a joint estate, has the right to convey or mortgage his or her

interest in the property, even if the other joint tenant objects.

m. Contribution

i. Real estate taxes

ii. Necessary repairs

1. basically you see the problem you fix it, there may be no compensation from co-tenants

2. tenant can demand an accounting


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iii. improvements

1. if value of property increases because you build a pool on the property, you cannot get paid

by the co-tennants unless they volunteer that, but you get the extra profit upon sale

2. so you get all profits or loss

n. tenancy by the entireties

i. requires 4 unities + marriage

ii. unseverable right of survivorship

1. neither party acting alone can get rid of survivorship acting without the other party

iii. at common law, reachable by creditors of husband

1. modern law varies

a. some states have common law tenancy

b. some have community property system

iv. at common law, if a husband wanted to sell his interest would he be allowed?

1. you can sell it for the duration of your life, but you cant destroy the wifes right of

survivorship

2. if husband dies first, she gets it back from the third party

3. if she dies first, husband would get it back and now he owns it entirely or he owns it pursuant

to the rights of the third party

4. idea was give her the right so shell have a place to live after he dies

v. how can you destroy the right of survivorship?

1. divorce is the only way because then the element of marriage is gone and the right of

survivorship terminates

2. it then turns into a tenancy in common

vi. at common law, can creditors reach the tenancy by the entireties

1. creditors can reach the interest and have it for the lifetime of the husband, as soon as he dies

the creditors have to give it back to the wife

vii. Can W enforce a contract to care for her sick H in exchange for a devise of certain property in his will?

1. Court held that this contract was void against public policy because husbands and wives

shouldnt make these contracts, undermines the meaning of marriage, and husband would

have same duty to W

o. Sawado v. Endo

i. The Endos conveyed their property to their sons the same day that H got into an auto accident that injured

the Sawados

ii. An estate by the entirety is not subject to the claims of creditors of only one of the spouses because

neither spouse acting alone can transfer his or her own interest

iii. Married Womens Property Act equaled out both spouses rights and so neither one can attach the property


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iv. court believes that they are protecting the family unit which is dependant upon keeping property

1. protect the rest of the family from the one debt-ridden spouse

a. joint creditors can still attach, however, so this is not a free ride, we just want to

protect one spouse from the other spouses debts

p. Division of Property upon divorce

i. Old rule: Common law: property belongs to spouse with title (alimony system)

ii. modern common law: equitable distribution

1. they each get a fair share of what was earned during the marriage dependant upon whether

either side was at fault

2. used rules of equity to figure out fair distribution of property (how did each contribute to the

marriage?)

a. does the wife have earning capacity or did she stop working to take care of the kids?

3. different states define marital property differently

a. courts undertaking equitable distribution may look at anything owned by spouse to be

considered equitable property subject to division

b. other states will only look at property that was acquired during the marriage but not

before

c. other states only look at things earned during marriage (inheritances and gifts would

not be touchable by the other spouse)

4. the current trend is to move towards equal distribution so effectively they are moving closer

to the community property (a 50/50 divide of the assets)

5. alimony isnt supposed to go on forever anymore, but its meant for the short term

iii. Community property

1. not tenancy by the entirety, but is community property based on the idea that marriage is an

equal partnership based on the joint effort of both spouses (only held in 8 states out west)

2. result of this view is that each party gets 50% upon divorce

iv. Common law property

1. In re marriage of Graham (Colorado)

a. During the marriage, husband got MBA and BS, increasing his earning power

greatly, while at the same time his wife worked as a flight attendant to support them

while he was in school and only working part time

b. She contributed 70% to the marital income, and kept house, while he studied

c. He just got his first big job so the couple didnt have time to accumulate any marital

property just yet


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d. Court determined that an MBA is not considered property because it wasnt

tangible and cannot be transferred to another or determine its value and cannot be

handed to someone in a will

i. She may be able to get unjust enrichment and it may determine what type of

alimony shes going to get

2. not all courts agree on this question

a. Mahoney v. Mahoney claimed that if you spent $20,000 on your spouses education,

youre going to get that $20,000 back but nothing else (New Jersey)

i. reimbursement alimonycompensation for amounts you contributed

towards the spouses future earning capacity

b. OBrien v. OBrien rules that increased earning potential for a law degree is equitable

(New York)

i. Minority view (most states either follow Mahoney or Graham)

c. Difference between the two: In Mahoney you get your money back, in OBrien you

get back increased investment (a share of the profits or future reward)

q. Elkus v. Elkus (NY)

i. Opera singer made it big after she married her husband, husband wanted money from her celebrity

ii. He helped her to gain notoriety by coaching her

iii. Married for 17 years with 2 kids, they started out with almost nothing and then she made it to the lead of

the metropolitan opera

1. he wants not just a division of assets earned by career, but a % of future earning capacity

iv. court rules that the celebrity was a product of their joint efforts and as such is subject to distribution

v. court defines marital property as things of value acquired during marriage are marital property even though

they may fall outside the scope of traditional property concepts (they follow OBrienthe exact opposite

of Graham)

r. Community Property

i. All property earned by the couple, or bought with the earnings during marriage is held as community

property regardless of the nominal title, unless the couple agree otherwise

ii. Separate property is:

1. property acquired by gift or inheritance

2. property owned by a spouse prior to marriage

iii. H married W, saves $5000 out of his earnings, which he deposits in a savings account in his name only

1. H withdraws the $5000 and buys a lot, taking title in H and W as joint tenants

2. H then dies, devising all his separate and community property to his son, S

3. who owns the lot?

a. When H died he only had rights to dispose of half of his interests


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b. When H put the money in a separate account, it was still community property

c. W owns it, because he would need her consent in order to create a joint tenancy

because this is a community property state

i. Assuming she did not give permission, she owns of it, son owns the H

owned before he died (because it was passed to him through the will)

ii. If the wife had consented to change it into a joint tenancy, she would have

gotten the whole thing because she would have had a right of survivorship

(son would get nothing)

iv. Community property characteristics

1. no right to survivorship

2. transfer: neither spouse can transfer without consent of other

3. management: spouse with title or possession of property manages as fiduciarymust

manage in good faith to the betterment of the community

4. creditors of managing spouse can reach whatever property that spouse is entitled to manage

a. with land, in many states it can be conveyed, mortgaged or transferred if you have the

signature of both spouses

i. the fact that one spouse is entitled to manage the house doesnt mean she can

sell it without her husbands consent

v. Mixing community property

1. inception of right

a. character of property is determined at the time the person signs the contract for the

property

b. if you signed contract for $100k house before marriage and paid $25k then, you are

entitled to the whole house

i. but if the community pays $80k for mortgage payments, they are entitled to

their portion that they paid of that

2. time of vesting

a. spouses are entitled to property when it vests in the spouse

b. pay 25k before and 80k after marriage, because the title vests after youre married,

the entire 100k house is community property

3. pro rata apportionment

a. you get the percentage of what you put in back (regardless of whether it was before

or after the marriage)

4. during marriage, H takes out $50,000 life insurance policy on his life, paying premiums out

of his earnings

a. the named beneficiary is his son


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b. the policy was community property because it was bought with earnings from the

marriage

i. she is entitled to half of the policy, and the son gets the fathers share

c. what if the husband took out the policy before marriage, paid $3000, then after

marriage another $7000

i. depends on the jurisdiction

1. under inception of right she would only get $3500 (1/2 of part that

she paid for i.e. the $7000)

2. under time of vesting shed get all of it because it vested when he

died (he died married)

3. under pro rata she gets the portion which she spent on itshe would

get 35% (1/2 of 7000 which was amount she spent out of the

$10,000)

s. Migrating couples

i. Acquisition

1. property is characterized by the law of the domicile of the parties at the time of acquisition

2. moving to a new state doesnt change the dynamics of the property unless the couple

mandates it is so before a problem arises

ii. disposition

1. at death, personal property is disposed of by the law of the domicile of the parties at the time

of death

a. common law=elective share

b. community property=1/2 community property

2. when one spouse dies, the other spouse has an elective share

a. under common law, you have a right to take a percentage of the entire estate that your

spouse leaves

i. if your spouse leaves you $2, you can elect to toss the $2 that was left to you

and get either 1/3 or thats in the estate

b. community propertythe surviving spouse gets one half of the community property

regardless of what provisions the decedent left in his will

c. elective share looks at all of the decedents property, but in community property you

ONLY look at community propertystuff that he had before marriage doesnt count

as community property

d. if you move to a non-community property state and then your spouse dies, you dont

get the benefit of the community property anymore

iii. husband and wife marry and live in Ohio, H earns $500k, Ohio has elective share


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1. they move to texas that doesnt have elective share, what does wife get? If he devises all his

property to his daughter

a. In Ohio, she would have gotten or 1/3

b. In Texas she gets nothing because she had no community property because Ohio

common law governed until Hs death

t. Property Rights in Domestic Partners

i. Express and implied contracts are sometimes used to avoid property to domestic partners upon death or

divorce

1. Martin v. Martin

a. Through conduct towards each other, it can be implied that they had a contract to

divide their property if they decided to split up (these were two who were not

married)

2. several states wont enforce an implied contract of property between unmarried people (idea

behind it is all states abolished common law marriage) NY doesnt enforce them

ii. ALI principles adopt common law marriage approach. Domestic partners must share a primary residence

and a life together as a couple

1. upon divorce, property divided like marital property

2. upon death, property distributed according to intestate

iii. Goodridge v. Department of Public Health

1. A governmental ban on same-sex marriage bars the guarantee of due process and equal

protection under the Massachusetts Constitution

III. Leasehold estate

a. Leasehold estate

i. Is an exclusive right of possession of real property for a specified period of time, which is granted

ii. In exchange for the payment of rent, and is

iii. Subject to the terms and condition of the lease

b. Forms of leasehold estates

i. Term of years

1. duration: known fixed period

2. notice of termination: none required

3. ex: 1 year from the date the lease is signed you know exactly what calendar date it will start

and end on

a. it can terminate early (if you lease an apartment and stop paying your rent your

landlord can evict you)

ii. Periodic tenancy


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1. duration: continues for successive periods of fixed duration (ex. From month to month or

from year to year) unless notice of termination is given

2. notice of termination:

a. year to year=at common law you need 6 months notice (shorter under modern

statutes)

b. less than year to year=equal to period (cant exceed 6 months)

c. lease must termination on last day of a period

iii. Tenancy at will

1. duration: as long as L and T desire

2. notice of termination: at common law, terminable by either party without notice (modern

statutes require some period of notice)

a. modern statutes do require some form of notice (usually 30 days)

iv. Tenancy at sufferance

1. legal term for situation that arises when a tenant remains in possession after the termination

of the lease

2. L has 2 options

a. Evict the tenant

b. Hold-over tenant for another term

i. In some states a 5 year to year can be held over for a month but some states it

can be a hold over as large as year to year

c. Characterizing leaseholds

i. Intent based approach: garner v. gerrish

1. it is lessee has the option of terminating a lease when he please, a determinable life

tenancy is created

2. not a tenancy at will but a terminable life estate because of the doctrine of siesin

a. lease cannot create a life estate

3. This lease creates a determinable life estate

4. Court is presented with an agreement that calls itself a lease, but it doesnt fit into any of the

lease boxes so the court thinks about what it is closest to

5. a lease creates a landlord/tenant relationship and poses certain rights and duties on the parties

which are not applicable in other types of estates

a. termination of rights

b. assignability

c. mitigation of damages

i. leases are now looked at as contracts

d. statute of frauds


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i. certain leases are exempted and other agreements are never exempt

6. contract/conveyance

a. parties may argue whether a particular document creates what, and the main

characteristic of the lease is that you are transferring possession

b. but a license or easement is only the right to use the property

i. with a lease the landlord doesnt have right to come in and use your

bathroom, but an easement to use a landlords private road doesnt stop him

from being able to use it as well

c. leases are a combination contract/conveyance which contain property elements

d. Tenancy at Suffereance: Crechale & Polles, Inc. v. Smith

i. Five year lease expiring in Feb of 1969, but the new building they were going to move into was not

finished yet, so landlord disagreed to this month-to-month, but Smith thinks that he was allowed to stay

there until the building was sold, but wouldnt put it in writing

ii. Once a landlord elects either to treat a hold-over as a trespasser or to hold him to a new term, he

may not change his mind

iii. when you have a hold-over tenant the general rule is that tenancy from year to year is created, but this case

is different because the landlord cashed the first check he got under the month to month lease

iv. it is not a good policy to make people stay in a lease longer then they wanted to because in a holdover

sometimes the punishment far outweighs the results for the landlord

e. Discrimination in Choice of Tenants

i. Federal law prevents it: Civil Rights Act of 1866 1982

1. All citizens of the United States shall have the same right, in every State and Territory, as is

enjoyed by white citizens hereof to inherit, purchase, lease, sell, hold, and convey real and

personal property.

ii. Fair Housing Act of 1968

1. 3604(a) makes it unlawful to refuse to rentorsella dwellingto any person because ofrace,

color, religion, sex, familial status or national origin

2. 3604(c) makes it unlawful to indicate any such discriminatory preference in a notice or

advertisement

3. 3604(f)(1) makes it unlawful to discriminate in the sale or rental of a dwelling because of

handicap.

4. Exemptions

a. 3603(b)(1) A single family dwelling rented by the owner, provided the owner (a)

does not own more than 3 such dwellings, (b) does not use a broker and (c) does not

advertise discriminatory preference;


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b. 3603(b)(2) Units within a 4 family home, if the owner actually maintains and

occupies one of the units;

c. 3607 Housing forseniors may discriminate against families with children.

iii. Mrs. Murphy has an apartment to re

Beenish's Property Outline

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