PROPERTY D SLIDES 3-6-14. Thursday March 6 Music: Bach, Unaccompanied Cello Suites Yo-Yo Ma, Cello...

PROPERTY D SLIDES3-6-14

Thursday March 6 Music: Bach, Unaccompanied Cello SuitesYo-Yo Ma, Cello (Released 2006)

Lunch Today: Meet on Brix @ 12:25Grossman, Jarzabek, Kratzer, McCarten, Ramos,

Rostock

BISCAYNE: Mahrenholz & DQ4.09Distinguishing FSD from FSCSFSD from FSCS

"to be used for school purpose only; otherwise to revert to Grantors herein.”

•Arguments for FSD• “only” suggests automatic• Condition in clause creating fee, not subsequent clause • “to revert” (v. “may re-enter”) suggests automatic• Similar grants held FSD

•Arguments for FSCS?

BISCAYNE: Mahrenholz & DQ4.09Distinguishing FSD from FSCSFSD from FSCS

"to be used for school purpose only; otherwise to revert to Grantors herein.”

•Arguments for FSCS• 2 clauses usually used for FSCS• No time words• “Otherwise” looks like “but if” • Most states presume FSCS

BISCAYNE: Mahrenholz & DQ4.10Distinguishing FSD from FSCS: ConsequencesFSD from FSCS: Consequences

Under what circumstances might the distinction between a fee simple determinable and a fee

simple on condition subsequent be significant?

BISCAYNE: Mahrenholz & DQ4.10Distinguishing FSD from FSCS: ConsequencesFSD from FSCS: Consequences• Transferability after breach (Mahrenholz issue)

• Adverse Possession (Clock starts running immediately when condition violated if FSD)

• Income from land after breach (Goes to future interest holder if FSD)

•Waiver/Estoppel by future interest holder (only possible if FSCS)

BISCAYNE: Mahrenholz & DQ4.10Distinguishing FSD from FSCS: ConsequencesFSD from FSCS: Consequences

Given significant consequences, why do so many grants fail to indicate clearly which

interest is intended?

Mahrenholz Distinguishing FSD from FSCS:FSD from FSCS:

Test Note #2Test Note #2: : Test Will Include At Least One Grant (Yielding Multiple Test Will Include At Least One Grant (Yielding Multiple Questions) with a Present Estate That Could Be Either Questions) with a Present Estate That Could Be Either

DeterminableDeterminable or or on Condition Subsequenton Condition Subsequent, So You Need to , So You Need to Know Arguments Distinguishing the TwoKnow Arguments Distinguishing the Two.

E.g., Problem 4I Includes This Kind of Ambiguous Grant

BISCAYNE: Mahrenholz & DQ4.11Meaning of “School Purpose”

IS STORAGE A “SCHOOL PURPOSE”?•Parties’ Likely Arguments• For School District?• For Future Interest Holder?


IS STORAGE A “SCHOOL PURPOSE”?•What legal research could you do to help resolve this question?


IS STORAGE A “SCHOOL PURPOSE”?•Useful Legal Research includes:• CASES ON “SCHOOL PURPOSE”

• CASES ON “CHURCH PURPOSE” ETC. • OTHER LEGAL LIMITS ON SCHOOL ACTIVITIES (to demonstrate what the term could

reasonably be understood to mean; clever Menendez point)

•What factual research could you do to help resolve this question? (What facts matter?)


IS STORAGE A “SCHOOL PURPOSE”?•Useful Factual Research includes:• Use of Space• Grantor’s Intent


IS STORAGE A “SCHOOL PURPOSE”?•Useful Factual Research includes:• Use of Space• What is stored & how used? • Alternatives (Crowding? Cost?)• How regularly is storage accessed?

•Grantor’s Intent


IS STORAGE A “SCHOOL PURPOSE”?•Useful Factual Research includes:• Use of Space• Grantor’s Intent• Check Grant or Related Documents•Witnesses to Transaction• Ask Grantor if Alive•Witnesses re Grantor Beliefs

Mahrenholz Meaning of “School Purpose”

Test Note #3Test Note #3: : Test Will Include At Least One Grant Containing an Imprecise Test Will Include At Least One Grant Containing an Imprecise

Term Like “School Purpose” and You Will Be Asked to Consider Term Like “School Purpose” and You Will Be Asked to Consider Arguments About Whether a Particular Action or Activity Falls Arguments About Whether a Particular Action or Activity Falls

Within that Term.Within that Term.

BISCAYNE: Mahrenholz & DQ4.12

Why should we allow grantors to have any control at all of what happens to land after

they have died?

We’ll come back to after Spring Break w Shapira case.

ME v. TEXTBOOK (P572)

• The Textbook says the Common Law rule that a Life Estate was the default estate did not apply to grants in wills. (Meads Q in class Monday).•For our purposes, assume that, at Common Law, a Life Estate was the default estate under all circumstances.

LOGISTICS

• Chapter 4 Test Preparation (3/24)• Info & Instructions on Course Page; E-Mail Me if Qs• Bank of Sample Qs & Entire Fall 2007 Test Will Be Posted by Monday Along with:

• List of Qs That Require Material We’ll Cover After Break• Answers to Qs You’re Ready For

• Remember We Have a Make-Up Class Wednesday 3/19 (Usual Time & Place)• I’ll Post Rest of Answers & Additional Tests & Answers After Class on 3/19

• Final Exam Preparation • Instructions for Submitting Sample Exam Answers on Course Page; E-Mail Me if Qs• If you want to submit more than one, first submission must be e-mailed to me by Noon on

Friday of Spring Break

LOGISTICS: During Spring Break I’ll Also Post

…• Chapter 5 Materials & Syllabus• Updated Assignment Sheet Covering the Rest of March• Comments & Model Answers to Posted Old Exam Qs•Write-Ups of Some of the Submitted Critiques

YELLOWSTONE (Problem 4O)

(Set-Up for Monday 3/17)

GIANT GEYSER

YELLOWSTONE: for Monday 3/17Set-Up for Problem 4O: Three Questions

1. Life estate determinable or fee simple determinable?2. Is condition restraining 2d marriage void?3. Is cohabitation a violation of a restraint on marriage?

Then Work Through Decision-Tree

REDWOOD: Problem 4I

REDWOODS & FERNS

REDWOOD: (4I): O conveys "to J and her heirs so long as the premises are not used for sale of beer, wine, or liquor, and if beer, wine, or liquor is sold on the

premises, O retains a right to re-enter the premises."

• J opens a restaurant that serves several dishes cooked with wine or flamed with brandy and at Sunday brunch offers a free glass of champagne.

• The restaurant is successful, and 11 years after its opening D wants to buy it and add a bar. Advise D.



MULTI-STEP ANALYSIS Corresponds to Plausible Sequence of Multiple Choice Qs

•FSD or FSCS?•CONDITION VIOLATED?•EFFECT OF VIOLATION?•ADVICE RE PURCHASE



MULTI-STEP ANALYSIS •FSD or FSCS?•CONDITION VIOLATED?•EFFECT OF VIOLATION?•ADVICE RE PURCHASE



FSD or FSCS? Does Orrin’s interest vest automatically (FSD) or does he have

to act (FSCS)?

Arguments for Each Position?



FSD or FSCS: Arguments Include:•“So long as” & condition built into 1st clause suggest FSD• Moment of violation likely pretty clear, so can be FSD•“Right to re-enter” & 2 clauses suggest FSCS•“Retains” suggests FSCS b/c implies that O’s right can be held for some period of time after violation• Most states: Presumption favoring FSCS• Mahrenholz: More like punishment than purpose (suggests FSCS)



MULTI-STEP ANALYSIS •FSD or FSCS? Some Arguments Each Way•CONDITION VIOLATED?•EFFECT OF VIOLATION?•ADVICE RE PURCHASE



Does It Violate Condition if J’s Restaurant:

(i)Serves several dishes cooked with wine or flamed with brandy?

(ii)At Sunday brunch offers complimentary glass of Champagne?



MULTI-STEP ANALYSIS •FSD or FSCS?

•CONDITION VIOLATED?– No Direct Sale of Liquor for $$$– BUT: Cost of Alcohol Incorporated in Purchase Price; Diners Buying

Alcohol in Meals

•EFFECT OF VIOLATION?•ADVICE RE PURCHASE



Effect of Violation if J has FSD & O has Possibility of Reverter

•O gets legal title at moment of violation.

•If sufficient time has passed, J may have title through adverse possession



Effect of Violation if J has FSCS & O has Right of Entry

•Assuming O has not acted, O still has RE

•If O is aware of Julia’s use of alcohol, may be held to have waived the right to enforce regarding these kinds of uses of alcohol.



MULTI-STEP ANALYSIS •FSD or FSCS?•CONDITION VIOLATED?

•EFFECT OF VIOLATION? (depends on FSD or FSCS)

•ADVICE RE PURCHASE?

DEFEASIBLE FEES:Effect of Transfer on Condition

• The purchaser/grantee of a defeasible fee takes subject to any condition not made irrelevant by the sale/transfer.

• Like purchaser/grantee of a Life Estate; usually can’t get more than grantor has.



• Example: To J so long as alcohol is never used on the premises.

• Wording of condition not limited to J; appears to apply to anyone

• Condition survives sale.



• Compare: To J so long as J never uses alcohol on the premises. • Condition only places limit on J.• Essentially void if J is not the owner. • Once J is dead, condition can never be violated, so owner

would have fee simple absolute.



• J opens a restaurant that serves several dishes cooked with wine or flamed with brandy and at Sunday brunch offers a free glass of champagne.

• The restaurant is successful, and 11 years after its opening D wants to buy it and add a bar.

Possible Advice to D?

REDWOOD: (4I)Plausible Advice to Donald Includes:

• Buy both present estate and future interest (or “all rights” of both J and O) to merge into f.s.absolute

• Serve free liquor & raise prices (and argue waiver if O questions)• Make purchase contingent on J insuring right to use alcohol (winning

suit re adverse possession/ waiver/etc.; buying future interest/waiver from O)

• Find out if D is willing and able to sell beer/wine on nearby site for people to take into restaurant.

Executory Executory InterestsInterests

Executory InterestsExecutory Interests• Future interest in grantee• Cuts off prior vested interest (present estate or

reversion or vested remainder) rather than waiting for it to expire naturally.

Pre-1536 (= Pre-“Common Law”) Limitations on Future Interests in Grantees (not used 2013)

• Must follow finite estate• Must be capable of taking effect at the expiration of

preceding estate • Must not take effect before the expiration of the preceding

estateElimination of these Rules in 1536 Allows Creation of Elimination of these Rules in 1536 Allows Creation of

Executory InterestsExecutory Interests

Executory InterestsExecutory Interests• Future interest in grantee• Cuts off prior vested interest (present estate or

reversion or vested remainder) rather than waiting for it to expire naturally.

Executory InterestsExecutory InterestsShifting v. Springing Executory Interest

•No legal consequence; just categorization•Shifting Executory Interest cuts off interest of another grantee•Springing Executory Interest cuts off grantor’s fee simple or reversion•Physical Model/Analaogy (if helpful)

Executory Interests Executory Interests EXAMPLESEXAMPLES

Shifting Executory Interest: To Justin & his heirs so long as no tobacco is grown on the

land, otherwise to Eric and his heirs., otherwise to Eric and his heirs.

Executory Interests Executory Interests EXAMPLESEXAMPLES

Springing Executory Interest:To Crystal if she passes the California bar exam. To Crystal if she passes the California bar exam.

(Grantor is left with Fee Simple on Executory Limitation)

(4F) Reggie “to Veronica for lifeto Veronica for life, then to Betty and her heirs if Betty attains the age of 21.”

Let’s Return to Problem 4F & Riverdale HighRiverdale High


• Veronica: Life Estate• Betty: Contingent Remainder in Fee Simple • Reggie: Reversion

• What if Veronica dies while Betty is still age 17? – Life Estate is Over– Betty Can’t Take; Condition Not Met


Veronica dies while Betty is still age 17

Common Law•If contingency not met when prior estate ends, contingent remainder is destroyeddestroyed.•Betty has nothing.•Reggie has fee simple absolute

Doctrine of Destructability of Contingent Remainders (Common Law)

First Common Application

If contingency not met when prior estate ends, contingent remainder is destroyed.destroyed.


Overruled by statute or caselaw in every American jurisdiction except …



Modern View (except FL)•If contingency not met when prior estate ends, we wait to see if it is met later.•Betty’s remainder becomes an executory interest.executory interest.•Reggie takes possession and has fee simple on executory limitation (cut off if B turns 21)



Modern View (except FL)

THE “READY BETTY” JOKE


Second Common Application

Where there is a life estate, one or more contingent remainders, and a reversion, and the life estate and reversion merge into a fee simple, the contingent remainders are destroyed. ..

Doctrine of Destructability of Contingent Remainders Second Common Application

•Caitlin “to Nicole for life, then to Stephen if Stephen passes a bar exam.

Doctrine of Destructability of Contingent Remainders Second Common Application

• Caitlin “to Nicole for life, then to Stephen if Stephen passes a bar exam.• Nicole purchases Reversion from Caitlin Fee Simple Absolute

Modern View (everywhere except Florida)Merger without Destruction

• Caitlin “to Nicole for life, then to Stephen if Stephen passes a bar exam.• Nicole purchases Reversion from Caitlin F.S. on Exec. Lim.• Stephen’s Remainder Becomes an Executory Interest

REDWOOD: Problems 4J & 4K

REDWOODS & FERNS

REDWOOD: (4J): Mary "to Rhoda for life, then to Ted if Ted gives Mary a proper funeral."

• Rhoda?


• Rhoda: Life Estate • Ted?


• Rhoda: Life Estate

• Ted: Contingent Remainder (if today: in f.s.) • Anything Else?


• Rhoda: Life Estate • Ted: Contingent Remainder (if today: in f.s.)

• Mary: Reversion

• Rhoda: Life Estate

• Ted? (Does Change from Mary’s Funeral to Rhoda’s Affect Nature of Ted’s Interest?)

• Rhoda: Life Estate • Ted can’t possibly give Rhoda a “proper” funeral by the

time Rhoda dies. – There will be a gap in time between the end of R’s life estate

and Ted’s interest. – Thus, Ted’s interest cannot be a remainder;

• So Ted has …?

REDWOOD: (4J): Mary "to Rhoda for life, then to Ted if Ted gives Rhoda a proper funeral."

• Rhoda: Life Estate • Mary: Reversion• Ted: Springing Executory Interest (would cut off

grantor’s interest: reversion)

EXAM TIP: USE COMMON SENSE!!

• Can’t give a “proper” funeral to a person until after the person has died.

EXAM TIP: USE COMMON SENSE!!

• Can’t give a “proper” funeral to a person until after the person has died.• Similarly, if an interest has been conveyed in a will,

you can assume the grantor is dead (will would not have become effective until death of grantor).

Remainders:Remainders: Additional InformationAdditional Information

Alternative Contingent Alternative Contingent RemaindersRemainders

Two contingent remainders where the event that causes one to vest will destroy the

other.


Two contingent remainders where the event that causes one to vest will destroy the other. Example:

Jordan grants: “To Kevin for life, then to Katherine and her heirs if she graduates from law school, but if she never graduates from law school, then to Sofia and her heirs”.


Two contingent remainders for which the event that causes one to vest will destroy the other. Example:

To Kevin for life, then to Katherine and her heirs if she graduates from law school, but if she never graduates from law school, then to Sofia and her heirs.

Here, only two possibilities: either (1) Katherine will graduate from law school (and would then take) or (2) she will die before graduating from law school (Sofia would then take)

Alternative Contingent Alternative Contingent RemaindersRemaindersTwo contingent remainders for which the event that

causes one to vest will destroy the other. Example:

•Example: Jordan: “To Kevin for life, then to Katherine and her heirs if she graduates from law school, but if she never graduates from law school, then to Sofia and her heirs.”•Note: Even though the alternative contingent remainders might appear to exhaust all possibilities, the convention is that you still must pencil in a reversion in the grantor to fill up the time line. Thus,

– Kevin has Life Estate

– Katherine & Sofia each have an Alternate Contingent Remainder (in F.S.)

– Jordan retains a Reversion

Vested Remainder Vested Remainder Subject to DivestmentSubject to Divestment

•Vested Remainder followed by an Executory Interest that could cut it off before it becomes possessory.

•Same as what textbook calls “Vested Remainder Subject to Complete Defeasance” (P596)

Contingent Remainder (1) v. Contingent Remainder (1) v. Vested Remainder Subject to Vested Remainder Subject to

Divestment (2)Divestment (2)(1) To A for life, then to B & her heirs if she turns 21, but if B dies before 21, then to C and his heirs. Reversion in O.

(2) To A for life, then to B & her heirs, but if B dies before 21, then to C & his heirs. (No Reversion in O)

EXAM TIP: COMMON MISTAKESEXAM TIP: COMMON MISTAKES

• Contingent Remainder Subject to Open• Contingent Remainder Subject to Divestment• Executory Interest Subject to Divestment

EXAM TIP: COMMON MISTAKESEXAM TIP: COMMON MISTAKES

REDWOOD (4K): “To George for life, then to Kramer and his heirs; but if Kramer does not attain the age of 21,

then to Elaine and her heirs." Kramer is 15 years old.

• George ?

REDWOOD (4K): “To George for life, then to Kramer and his heirs; but if Kramer does not attain the age of

21, then to Elaine and her heirs." Kramer is 15 years old.

• George: Life Estate• Kramer?

REDWOOD (4K): “To George for life, then to Kramer and his heirs; but if Kramer does not attain the age of

21, then to Elaine and her heirs." Kramer is 15 years old.

• George: Life Estate

• Kramer: Vested Rem. (in f.s.) Subj. to Divestment– Vested b/c K not reaching 21 is condition on Elaine’s interest; K doesn’t

have to reach 21 to get possession– Subject to Divestment b/c K can lose interest before it becomes possessory

if he dies before 21 while G alive

• Elaine?

REDWOOD (4K): “To George for life, then to Kramer and his heirs; but if Kramer does not attain the age of but if Kramer does not attain the age of

21, then to Elaine and her heirs." 21, then to Elaine and her heirs." Kramer is 15 years old.

• George: Life Estate• Kramer: Vested Rem. (in f.s.) Subj. to Divestment

• Elaine: Shifting Executory Interest (in f.s.)Elaine: Shifting Executory Interest (in f.s.)– Executory Interest b/c would cut off K’s Vested Rem. (or Fee if K gets

possession before turning 21)– Shifting b/c cutting off grantee’s interest– Note: If there’s a vested remainder, can’t have a second remainder

following same finite interest.


21, then to Elaine and her heirs." 21, then to Elaine and her heirs." Kramer is 15 years old.

• George: Life Estate• Kramer: Vested Rem. (in f.s.) Subj. to Divestment• Elaine: Shifting Executory Interest (in f.s.)Elaine: Shifting Executory Interest (in f.s.)

What if Kramer then turns 21 before George dies?What if Kramer then turns 21 before George dies?


21, then to Elaine and her heirs." 21, then to Elaine and her heirs." Kramer turns 21; George still alive.

• George: Life Estate• Kramer: Vested Rem. (in f.s.) Subj. to Divestment• Elaine: Shifting Executory Interest (in f.s.) Elaine: Shifting Executory Interest (in f.s.) Interest fails.Interest fails.

PROPERTY D SLIDES 3-6-14. Thursday March 6 Music: Bach, Unaccompanied Cello Suites Yo-Yo Ma, Cello...

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