PROPERTY OUTLINE

II. LANDLORD TENANT

A. Duty to Deliver Possession

1. The landlord has the duty of transferring to the tenant at the beginning of the tenancy the legal right to possession. The LL warrants that she has the legal right to possession and is transferring this to the tenant

2. Paramount Title: Any interest or title in land, held by a third party at the time the lease is made, which is paramount to the interest of the LL

3. Tenants remedies prior to entry: If on the beg. of a term a paramount title exists which could prevent the tenant from enjoying the use contemplated by the parties, and which the tenant is unaware of when he signs the lease, the tenant, prior to entry may terminate the lease. The tenant does not have to begin his tenure if after signing the lease he discovers a possibility that he will be evicted by a paramount claimant. If he knows of the paramount title at the time he signs the lease, he is presumed to waive the possibility of eviction by the paramount claimant.

4. After the tenant into possession: The tenant has no remedy unless he is actually evicted by paramount title.

5. Actual Possession

a. English View (Majority View): The LL has the duty to deliver actual possession as well as the right to possession. If the previous tenant has not moved out when the new tenant lease begins, and the LL does not remove the person w/in a reasonable period of time, the LL is in default.

1. Tenant's remedies: Terminate the lease and recover damages for having to find new place; tenant can affirm the lease, refuse to pay rent for the portion of the term during which he was kept out and recover damages(cost of renting other premises, cost of ousting holdover tenant, and loss of anticipated business)

b. Part Possession: If the holdover tenant is only in possession of part of the premises and the new tenant takes possession of the other part, the new tenant is entitled to an appropriate abatement in rent and damages.

c. American View (Minority View): The LL has no duty to deliver actual possession at the commencement of the term and hence is not in default under the lease when the previous tenant continues wrongfully to occupy the premises (Hannan v. Dusch).

1. The new tenant then has the same rights over the holdover tenant as the LL would so he can take court action to evict him.

B. LL's Duty Not To Interfere with Quiet Enjoyment

1. A tenant has a right of quiet enjoyment of the premises without interference by the LL. If not expressly provided, such a covenant is always implied.

2. Actual Eviction: If tenant is physically evicted from any portion of the leased premises by the LL or by paramount title, his rental obligation ceases. The tenant may treat the lease as terminated and his liability for further rent is discharged.

a. Partial Eviction by LL: If the tenant is evicted from any part, his rent abates entirely until possession.

b. Partial eviction by Paramount Title: The tenant may terminate the lease, recover damages, or receive a proportionate rent abatement. If the tenant remains in possession, he remains liable for the reasonable rental value of the portion he possesses.

3. Constructive Eviction: Through the fault of the LL, there occurs a substantial interference with the tenant's use and enjoyment of the land so that the tenant can no longer enjoy the premises as the parties contemplated. The tenant my terminate the lease, vacate the premises, and be excused from further rent liability.

4. ***Note: Actual eviction requires physical expulsion or exclusion from possession, while constructive eviction only requires interference with enjoyment.

5. Elements of Constructive Eviction:

a. Substantial Interference= Measured objectively (what a reasonable person would regard as fundamentally incompatible with the use and enjoyment). Courts usually take into consideration the purposes for which the premises were leased, the foreseeability of this type of interference, the potential duration of the interference, and the nature and degree of harm caused.

b. Prior to claiming constructive eviction, the tenant must give notice to the LL of the objectionable conduct and the LL must fail to remedy the situation within a reasonable time.

c. Tenant must vacate the premises

1. If the tenant vacates the premises upon constructive eviction, this action terminates the lease. However, the tenant can recover from the LL for damages suffered because of the eviction, including the difference between rent paid and reasonable rent value, expenses obtained in getting substitute premises, loss of profits, etc.

d. It must be due to some fault of the LL. As a general rule, the LL is not responsible for the acts of other tenants.

1. Exceptions= LL has a duty not to allow nuisance on the premises; also, the LL has a duty to control common areas under his control.

2. A modern trend is developing which holds the LL responsible for other tenant's acts if he has the legal ability to correct the conditions and failed to do so.

e. The court may decide after you have moved out that it wasnt bad enough to allow constructive eviction and make you pay double rent (rent on old place and rent on place you had to move into when you moved out in order to claim constructive eviction.)

f. Only a LL can constructively evict a tenant (by doing nothing). PEE ON THE WALL CASE: Not a constructive eviction because it was the LL's other tenant that caused the problem, not the LL's.

6. Implied covenant of Quiet Enjoyment:

a. LL has title..................No remedy

b. No Holdovers..................Damages due to moving delay; can rescind the lease and put parties back to where they were before lease was made.

c. Acutal eviction...............No rent owed

d. Constructive Eviction.........You must terminate the lease and move out.

C. LL'S DUTY TO PROVIDE HABITABLE PREMISES

1. Duty at Beginning of Lease

a. Common Law: No implied covenant by the LL that the premises ate in tenable condition or are fit for the purposes intended. The tenant takes them "caveat emptor"=as is.

2. Exceptions:

a. Furnished house for a short term

b. Hidden or latent defects, the LL has a duty to disclose them.

c. Building under construction: before it is finished.

d. Danger to people off the premises

e. Premises leased for public use

f. Common area defects

g. Covenant to repair

h. Negligent repairs

i. Violation of Statutes

j.**Some recent states have held the LL liable for negligence and disregard all of these exceptions (This is quickly becoming the majority)

3. Implied covenant of Habitability= In recent years a growing number of courts have held that there is an initial implied covenant of habitability and fitness in leases of urban dwellings.

4. Scope of Warranty

a. Some courts hold LL responsible for latent defects only.

b. Some courts hold that the local housing code sets the standards.

c. Remedies for breach= damages, restitution and recision of contract.

5. If the tenant before the lease makes a condition that the property is to be used for the sole purpose of some acitvity and then the activity is impossible, the LL may be liable.(THIS APPLIES TO COMMMERCIAL NOT PERSONAL LAND)

a. If you are going to purchase some land for commercial purposes, check the land out before you sin the lease.

6. If a statute or code promises a protection for 3rd party intruders, the LL is guilty of neg per se if he cioulates this and does nothing.

a. sometimes LL's are liable for protection if they assumed the risk and provided protection security guards. If they take the guards away, there could have been reliance, and they are held responsible.

D. LL'S DUTY TO REPAIR AFTER ENTRY BY THE TENANT

1. Common Law: The LL has no duty to maintain and repair the premises.

a. Covenant to Repair: The parties by agreement can make the LL responsible. However, this covenant is independent of the tenant's duty to pay rent. Hence if the LL fails to repair, this does not excuse the tenant from rent payments.

2. Implied Covenants of Habitability: A large majority of courts have implied on the part of the LL a continuing covenant of habitability in leases of urban dwellings. They have also held that if repairs are not made, the tenant can withhold rent.

E. LL's Duties when Old Tenant Unlawfull Holds Over

1. It is the new tenant's responsibility to get rid of the old tenant Hamlin v. Dusch. (More recent law says that it is the LL's duty.

F. LL's Duty to Protect from 3rd parties: LL has no such duty (ex. If you are evicted by some thugs that throw you out because your LL didnt pay them blood $, you do not have a claim against the LL.)

E. TENANT'S DUTIES

1. Duty to Pay rent

2. Duty to Repair

a. Common Law Duty: In the absence of a duty on the part of the LL to repair (imposed by statute, implied covenant of habitability, or express covenant) the tenant has a duty to make ordinary repairs to keep the property in the same condition as the beginning of the term, ordinary wear and tear excepted.

b. Duty not to commit affirmative waste: acts which substantially damage the premises or substantially change them.

c. Covenant by tenant to Repair= The tenant is liable for repairs, whatever the cause, even if the damage is by a third party or by an act of God and demolishes the entire property, he is liable.

3. Duty not to Disturb other tenants: Absent a covenant in the lease, there is no common law duty of the tenant not to make noise or otherwise disturb other tenants.

4. Duty not to Use For Illegal Purposes.

5. Duty to keep the premises wind and weather tight and to keep the elements out.

6. USE CLAUSE: Tells the tenant how to use the property: (THIS IS IN COMMERCIAL LEASES)

a. Prevents unwanted competition

b. Prevents undesirable businesses

c. Prevents illegal uses

d. "Shall use as a grocery store"= Like a deed and has no real meaning. It needs to have this plus "and not other purpose" added.

7. a lease is a nullity if it is made exclusively for an illegal purpose.

F. RIGHTS AND DUTIES RELATING TO FIXTURES= (fixtures are something that used to be personal property but has been attached to the real estate.

1. When the tenant attaches chattel to the premises, he may want to remove it upon termination of the lease.

2. The common law rule is that fixtures cannot be removed from the premises. They become part of the realty and therefor the property of the LL.

a. Fixture= Something that has been permanently attached to the land.

3. Modern Trend: Is very liberal in permitting the tenant to remove any chattel he installs on the leased purposes. The tenant must then restore the property if it is damaged (ex=patching up holes in the wall from pictures).

a. The tenant must remove the fixtures before the end of his term or they do become LL's property.

4. SALE OF REAL ESTATE--Who gets the things seen in the house? A fixture is part of the real estate if:

a. It is permanently attached

b. If it has been attached with the intent to remain with the real estate

G. LL'S REMEDIES

1. Abandonment by tenant: a) The LL may terminate the lease. b)let the premises idle and sue the tenant for the rent as it comes due. c) retake possession and attempt to relet the premises.

a. LL terminates the lease: The LL may terminate the lease when tenant abandons; this effects a surrender.

b. LL stands by and does nothing: (Majority)=Most courts hold that the LL has no duty to mitigate damages, since the tenant is seen as buying a term in the LL's land, and if he doesn't want to be on the premises, he doesn't have to be. (Minority)=The LL does have a duty to mitigate damages since a lease is treated as any other kind of contract.

c. LL repossesses and relets

1. Reletting effects surrender: One view is that the repossession and reletting affects surrender unless the tenant expressly or impliedly consents to reletting.

2. Reletting without notice effects surrender: Another view is that if the LL gives the tenant notice of the reletting and notice that he intends to hold the tenant for any loss in rental, the LL may relet for the tenants benefit.

a. If LL relets for a higher rent, he can not get damages from original tenant. If for a lower rent, he can get damages for the difference.

H. Tenants Remedies:

1. If the LL breaks covenants, the tenant can get:

a. Damages

b. Can terminate the lease

c. Injunction (getting LL to follow the words of the lease).

2. RULE OF INDEPENDANT COVENANTS: If 1 party commits a material breach of covenants, the other party can only get damages, not a termination of the lease. (Constructive eviction is an exception to that rule).

a. Kulewitz v. Pacific Woodenware: Throws this rule out the window and holds that if there is a material breach, the lease can be terminated, even if the tenant is in material breach himself for not paying the rent.

H. ASSIGNMENTS AND SUBLEASES

1. Why do we care which it is?

a. Subleases cannot be surrendered to someone else.

b. If a lease says no assignments withoth consent, you can still have a sublease.

2. Rule in Dumper's Case= pg 369, if LL consents to 1 assign, he has deemed consent to any further assignments and loses power to forbid further assignments unless he specifically reserves the rights and power in granting the first one.

3. Bob's U Drive

a. A lease=a cintract and a conveyance.

b. If you lease and then asign something to someone, you are not insulatied from liability on the covenants of the original lease. (No privity of estate, but still privity of contract).

c. For the assignment of a lease, it needs to be in writing if its over a year.

d. If acts estop (promissory estoppel) or make it clear that there was a lease, then no writing is needed.

4. Touching and Concerning the Land

a. If you have a sublease, and a covenant runs with the land, it makes no kifference and you do not have to follow the covenant. Covenants running with the land only apply to assignments.

b. The burden of the covenant runs with the land only if it touches and concerns the land.

c. Examples:

1. Covenants to arbitrate=?

2. To pay rent=yes

3. Business Activities=questionable

d. "Touches and concerns Test" is difficult to pin down at times. Look at:

1. Are legal interests AS OWNER rendered less valuable by the promise. (Bigelow)

2. Where the parties as laymen and not lawyers would naturally regard the covenant as intimately bound up with the land.(Clark)

e. To have a lawsuit, one party must ahve a burden and the other must have a benefit.

1. If an assumption agreement is signed, then there is automatic liability.

2. Both burdens and benefits are not gotten by sub=lessee unless expressly given and assumed. Does not run with the land.

I. Surety and Principle (Assumption agreements create this type of relationship)

a. "The LL's Lein", "Distress" "Distraint"= The right of the LL to enter the premises if rent is delinquent and cand take personal property for some time and sell it to pay for rent debt. This is in commercial leases, not really in personal leases.

b. Can a person who takes a sublease exercise the option to renew the lease:NO

J. Transfer of Land by the LL

a. Payment of taxes (burden) runs with the land and the L2 must pay this.

b. Duty to repair by tenant is a benefit to L2 that runs with the land and must be paid by the tenant.

K. Deposit made by T when L1 was the owner, L2 doesn't have the $, L2 doesnt have to pay because it doesnt touch and concern the land and is a personal security or L2 does because it is a security deposit for not damaging the property and does touch and concern the land. (The first explanation is how the cts usually hold.)

L. UNLAWFUL DETAINER: The right of a LL to remove a tenant quickly. (the alternative is common law ejectment and this takes forever in a system where speed is imp. for the LL.

1. If a trial ct. of limited jurisdiction, use it.

2. Set very tight time lim. on when the case is to be answered and come to trial.

3. Limit the issues that can be reaised at the time.

4. No discovery.

M. ABANDONMENT AND SURRENDER

1. iF A PLAINTIFF DOESNT MITIGAT DAMAGES (EX=DUTY TO TRY AND SELL ORANGES INSTEAD OF TAKING A LOSS), the amount they could have fotten with reasonable effort is subtracted form the amount they can get in court.

2. If a tenant wrongfully abandons, the LL may;

a. Enter and terminate the K and recover rent due up to abandonment.

b. Keep land vacant and sue on K for entire rent

c. Give notice to tenant of is refusal to accept surrender and sublet the premises to reduce damages.

d. BUT: If LL takes forcible possession without T's consent, he cant recover to exceed the amount of rent due to the time he tool possession.

3. If the abandoning tenant brings another person to the LL to rent his space and the LL refuses, the Ll cannot get damages when the original tenant abandons.

II. EASEMENTS

A. Definition: A grant of an interest in land which entitles a person to use land possessed by another.

1. Affirmative easement: The right to go onto the land of another (the servient land) and do some act on the land.

2. Negative Easement: The owner of this easement can prevent the owner of the servient land from doing some act on the servient land.

B. Appurtenant Easements: If it benefits its owner in the use of another tract of land, it is appurtenant to that land. The land benefited is called the dominant tenement, the land burdened is the servient tenement.

1. Passes with dominant tenement= is attached to the dominant tenement and passes with the tenement to any subsequent owner of the tenement. It cannot be separated form the dominant tenement and turned into an easement in gross unless the owners of the dominant and servient tenements make a new agreement.

2. Negative Easements are always appurtanent to the land.

3. These types of easements are favored by the courts if it is ambiguous.

C. Easement In Gross: Easements that gives the owner the right to use servient land. It can be assigned if the parties so intend.

D. Easements are interests in land= This means that the burdens pass to subsequent owners of the servient land.

E. Profit Compared: A Profit a Prendre is the right to take something off another persons land that is part of the land or a product of the land.

F. Liscense Compared: A liscense is permission to go upon land belonging to the licensor. A license can be oral or in writing. A liscense is revokable at the will of the liscensor.

1. A liscense may become irrevocable in certain limited situations.

a. Estoppel: If a liscense has constructed substantial improvements on either the licensor's land dor the licensee's land, relying on the liscense in many states the licensor is estopped from revoking the license.

G. Creation of Easements:

1. Creation by express grant

a. Statute of Frauds: Unless one of the exceptions to the statute of frauds applies, creation of an easement requires a written instrument signed by the grantor. If there is no written instrument, the grantee merely has a lisvense to use the land which can be revoked at will.

b. Duration: Can last forever, and is assumed to be an easement in fee simple if nothing is stated.

2. Creation by Reservation: If the grantor conveys land, reserving an easement, the land conveyed is the servient tenement.

a. In favor of a 3rd Party:At common law an easement could not be reserved in favor of a 3rd party.

1. Covenants can though.

2. Minority view: Some modern cases hold that an easement may be reserved in favor of a third person.

3. Creation by Implication: This is created by operation of law, not by a written instrument. It is an exception to the statute of frauds. It is limited to two kinds:

a. An intended easement based on an apparent use existing at the time the servient tenement is separated from the dominant tenement.

1. Prior to the time a tract of land is divided into two lots, a use exists on the servient part that is reasonably necessary for the enjoyment of the sominant part. This existing use is called a quasi easement.

2. In order to have a quasi easement, the previous use must be:

a. Apparent. It is apparent if a grantee could, by a reasonable inspection of the premises, discover the existance of the use. Apparant does not mean the same thing as visible.

b. Continuous: The previous use must be sontinuous, not sporadic.

c. Reasonable Necessity. The easement must be necessary for the enjoyment of the claimed dominant tenement.

b. Easement by necessity= Public policy requires a way of access to each separate aprcel of land or on the ground that since access is essential to use, the parties intended to create an easement but overlooked puttting it in the deed.

1. The necessity must exist when the tract is severed. The easement is implied only over that portion of the divided tract that blocks access to a public road. ***An easement of necessity cannot be implied over land that was never owned by the common grantor of the dominant and servient tenements.

H. Prescription

1. Rewuirements:

a. Open and Notorious Use

b. Must be under a calim of right, and not with permission of the owner of the land.

c. Exclusivity NOT required.

d. Continuous Use: Requires a continuous claim of right and periodic acts which, given the nature of the type of easement claimed, give notice to the owner that an easement is being claimed. This requirement does not mean that it needs to be constant.

1. Sporadic and occasional trespasses are not enought ot establish continuous use.

2. Tacking is allowed in prescription just as it is allowed in adverse posseeesion.

e. Uninterrupted use.

2. When Prescriptive rights cannot be acquired:

a. Neg Easements: this is because prescription bars a cause of action and where the owner has no cause of action, prescription does not aply.

b. Easements by Necessity: This is because the use of an easement by necessity is by right and not wrongful.

c. Public Lands: Cannot be obtained.

I. Scope of Easements:

1. General Rule: The scope depends on the intention of the parties. to determine this, the court may examine whether the easement was created expressely or by prescription, what changes in use might reasonably be forseeeabble by the parties, and what changes in use are required to achieve the purpose of the easement uner modern conditions and preserve the usefullness of the easement to the dominent tenement. the ct wil also look at whether the increase in the burden is unreasonable.

2. How easement was created:

a. Express Easement: I it was expressly created, the ct will look at the language of the instrument, together with the surrounding circumstances, in order to determine intent.

b. Easement of Way: Is given a scope that permits it to meet the needs of the dominant tenement as it normally develops. It may be used in ways reasonable foreseeeable by th eparties or if not forseeable, by ordinary means of transportation as those means normaly evolve.

1. Adding Utilities: The courts are split on whether installation of electric poles and wires comes within the purpose of the easement.

c. Implied Easements

1. Existing Use: If an easement is implied on the basis of a use existing at the time of severance of a tract into two parcels which the parties intended to continue, the scope is generally the same as an express easement. changes that reasonably might have been expected or that are necessary to preserve the utility are permitted.

2. Easement by Necessity: The extent of the necessity determines the scope.

3. subdivision of dominant tenement: As a general rule, if the dominant estate is subdivided, each subdivided lot has a right to use easements appurtenant to the dominant estate an easement is appurtenant to every part of the dominant tenement. However, there is an important limitation on use of an easement by subdivided lots: The servient estate is nto to be burdened to a greater extent than was contemplated at the time the easement was cteated.

4. Use for benefit of nondominant land: An easement granted for the benefit of lot 1 cannot be used for the benefit of lot 2, even though the same person owns ots 1 and 2. The dominant owner cannot increase the scope of the easement by using it to benefit a nondominant tenement.

5. change in location of Easement: If an easement has been granted in a specific location, or has been located by mutual agreement of the parties, the location cannot thereafter be changed by one party acting unilaterally. It can be changed by mutual consent only.

6. Easements in gross:

a. Nonexclusive Use: If an easement in gross is nonexclusive (ie. it is enjoyed both by the beneficiary an the serveint owner) it cannot be apportioned.

b. Exclusive Use: If the easement in gross is exclusive, the easement can be apportioned or divided by its owner.

7. Profits in gross--The one stock rule: Almost all profits are held in gross. They are not appurtenant to the land.

J. Transfer of Easements:

1. Easement Appurtenant; Where the dominant tenement is transferred, any easements appurtenant are transferred with it. Aimilarly, the burden of an easement appurtenent passes with the servient land when transferred. It is thought of as attached to the dominant land, and it benefits the possessor of that land, including an adverse possessor. By mutual consent, they can detach the easement and either attach it to other dominant land or convert it into an easement in gross, but neither party acting alone can do this.

2. Easements in gross: If the benefit of an easement in gross is inherited by or assigned to a large number of persons, it may be difficult to located these persons, making it difficult to secure a release of the easement or to clear up title.

a. Easement not assignable: In most jurisdictions this rule is no longer followed, at least with respect to commercial easement an maybe with respect to all easements in gross.

b. Commercial easements in gross are assignable: Commercial easement n gross are those that have primarily economic benefit rather than personal satisfaction.

c. In some jurisdictions, all easements in gross may be assignable.

3. Profits in Gross: Have always been assignable.

K. Termination of Easements:

1. By Unity of Title: An easement is a right in the land of another. If the title to the easement and title to the servient tenement come into the hands of one person, the easement is extinguished.

2. By an act of the dominant owner:

a. Written Release: The owner of an easement may release the easement to the servient owner in writing.

b. Oral Release: It cannot be conveyed this way because of the Statute of Frauds. However, if the oral agrement is accompanied by an act showing intent to abandon, the easements may be extinguished by abandondonment.

1. Estoppel: If the owner of an easement orally releases it to the servient owner, and the servient owner expends money in reliance on the oral release, the easement owner is estopped to plead the Statute of Frauds. The easement is extinguished by the oral release and action in reliance.

c. Nonuse: This does not extinguish an easement.

d. Abandonment: If the owner of an easement acts in such a way as to indicate a clear intent to abandon the easement, it is abandoned.

1. Rationale: The abandonment of an easement removes an encumbrance on title and makes land more marketable.

e. Alteration of dominant tenement: If an easement is granted for a particular purpose, and an alteration of the dominant tenement makes it impossible to achieve the purpose any longer, the easement is extinguished.

f. Easement by Necessity: Terminates when the necessity ends.

g. Excessive use: Excessive use or misuse of an easement does not extinguish an easement. The remedy against excessive use is an injunction forbidding improper use. However, when it becomes impossible or impracticable to police the excessive use, the easement may be extinguished by a court.

3. By Act of Servient Owner:

a. Destruction of Servient Tenement: If unintentional, then the easement is destroyed. if it is destroyed by an intentional act of the servient owner, it is not extinguished.

b. Prescription: If the servient owner interferes with an easement in an adverse manner, the servient owner can extinguish the easement by presecription.

c. By change of conditions: This is not applicable to easements.

III. COVENANTS

A. A covenant is a promise to do or not to do a certain thing. the promise to do something is an affirmative promise while a promise not to do something is a negative promise. If the promisee sues the promisor for breach, the law of contracts applies. However, if a person who buys the promisee's land is suing a person who buys the promisor's land then the law of property is applicable.

B. Remedies for breach: Either money damages (IN LAW) or An injunction decree requiring specific performance of the promise (IN EQUITY)

C. Real covenant= A covenant that runs with the land at law, so that each person who owns the land subsequently is entitled to enforce or is burdened by the covenant.

1. Personal Liability Only: A real covenant gives rise to personal liability only. It is enforceable only by an award of money damages.

2. The English courts never extended the concept of real covenants past the LL-tenant context. However, In US, they extended it to promises between fee simple owners or neighbors.

3. A real covenant is attached to the estate in land. The burden passes to anyone who takes that estate.

D. Distinguished from Other Interests:

1. Equitable Servitude: This is a covenant enforceable in equity by or against successors to the land of the original parties to the contract. Hence, if the plaintiff wants equitable relief, he must show that the covenant qualifies as an equitable servitude.

E. Benefit and Burden: One tract is burdened for the benefit of another tract.

1. Requirements for burden to run at law:

a. Intent: The contracting parties must intend that the successors to the promisor be bound by the covenant.

b. Privity of Estate: There must be both horizontal and vertical privity.

c. Touch and Concern: The covenant must touch and concern the burdened land.

1. ex. Does a promise to buy lime only from a certain lime pit touch and concern the land?

a. One argument= No, it affects a method of business on the land, not the land's use.

b. Actually the answer is that its debatable.

d. Notice: The purchaser of the promisor's land is not bound by the covenant unless he has notice of it before buying the land.

2. Requirements for the Benefit to Run at Law:

a. Intent

b. Vertical privity is required. (Horizontal is not)

c. Touch and Concern: The benefit must T/C

3. Definitions:

a. Intention of the parties: The intention of the parties is usually found in the language of the deed or the contract

b. Privity (Privity=to have a simultaneous interest in land) of Estate:

1. Horizontal Privity: The relationship that exists between the original promisor and promisee. This is necessary for the burden to run. (In England, this was only so if there was a LL/tenant relationship) In US it is found in 3 situations: KNOW FOR FINAL, WORD FOR WORD!!

a. LL/tenant relationship

b. If the covenant is part of a transfer of an interest in land wich is either benefited or burdened or the covenant is made in adjustment of the mutual relationship arisiong out of the existence of an easement held by one of the parties in the land of the other. It must arise out of and be about that easement, not about something else.

1. Broad interpretation: One party has interest in another (simultaneous interest in land)

2. Narrow interpretation: Simultaneous interest of easements in the other.

c. Covenant is in a deed of a benefited or burdened parcel.

2. Vertical Privity: Privity between a covenanting party and an assignee. Is necessary for BOTH the burden and the benefit to run. Is usually present with fee simple cases.

a. Homeowner's association: May sue to enforce the benefit of a covenant even though the homeowner's assoc. succeeds no land owned by the promisee.

b. Courts are more lenient on the runnign of benefits side than on the running of burdens.

c. Touch and Concern: This is necessary for both the burden and the benefit to run with the land.

d. Notice: A bona fide purchaser of the burdened land is not bound at law if he has no notice of the covenant. The same notice req. is applicable to equitable servitudes.

1. Looking at the neighborhood may tip someone off to covenants of a residential neighborhood. (A common plan should tip someone off).

e. Liability of original promisor after assignment:

1. Ppromise to Perform an act: If the covenant is a promise to do or not to do some act on the burdened land, the covenantor has no liability after assignment.

2. Promise to pay money: If the covenant is a promise to pay money, the covenantor may be liable after assignment on the theory that his personal credit may be important to the deal.

4. Sometimes 2 parties promise identical things, then both have some sort of a burden and a benefit. If we wait awhile and see who breaches, whoever breaches gets the burden, and woever doesnt breach gets the benefit.

5. Covenants In Gross: There doesnt have to be benefited land, there only needs to be burdened land.

6. Common Plan

a. There may be a Common Plan (if so, then many cts hold that the other lots in the common plan are benefited).

b. Must have several lots.

c. Lots must be close together.

d. The lots must be approx. the same size/

e. Most or some of the lots have similar covenants in them.

7. Functions of the Common Plan:

a. Way of determining how much land the covenentee wants to hve benefitted.

b. Allows land to be benefited by covenant even if covenentee sells some of the land before he put the covenant on the other parts of the common plan.

c. Creates a reciprocal negative easement (to implicitly promise that all land in the common plan will be restricted not just to certain plots.)

d. To give notice that a reciprocal neg. easemetn exists. (It recognizes that there is a point, dont know exactly where, that such a small percent of covenants exist in a subdivision that a common plan may not exist.

e. Similar covenats in a common plan will be enforced on lther plots in a common plan if not already given.

F. Creation:

1. Writing Required: A real covenant cannot be implied nor can it arise by prescription.

2. Grantee bound without signing, usually only signe dby the grantor.

3. When you draft a covenant, always say what land is benefited. If you never express this, there may be a number that touch an concern.

4. You cannot intend to benefit some land that you dont own. (This is because you cannot reserve an easement for the benefit for someone other than yourself.)

G. EQUITABLE SERVITUDES:

1. Definition: A covenant whether running with the land or not that equity will enforce against assignees of the burdened land who have notice of the ocvenant. The usual remedy granted is an injunctions against violation of the covenant.

2. Compared with a real covenant:

a. Remedy: If a promisee seeks damages or a money judgement, the promisee must fo into law and attempt to force the promise as areal covenant. If an injunction=an equitable servitude.

3. Creation: A real covenant must be in writing, while an equitable servitude can be implied.

4. Privity of estate: Horizonal privity is not required in equity. Vertical privity is, but it is usually there and not really a problem.

5. Both real covenants and equitable servitudes require that the covenant touch and concern the land. Neither is enforceable against a bona fide purchaser who has no notice.

H. Termination of Covenants and Servitudes:

1. Merger: If the title of the benefited and the burdened land come into the hands fo one person.

2. Equitable defences to enforcement: Any of the following may be asserted as defenses to enforcement where and equitable servitude is claimed:

a. Acquiesance: If a benefited party acquieces in a breach of the ervitude by one burdened party, he may be deemed to have abandoned the servitude.

b. Estoppel: If a benefited party acts in such a way as to lead a reas person tobelieve that the covenant was abandoned, and the burdened party acts in reliace, the benefited party may be estopped to enforce the covenant.

c. Relative Hardship: A court of equity may deny an injunction when the hardship tothe defendant is great and the benefit is small.

3. Change of conditions in the neighborhood: If this is shown, the courts of equity will refuse to enforce the covenant. However, for the defense to succeed, most courts require that the change outside the subdivision must be so pervasive that all lots in the subdivision are unsuitable for the uses in the covenant, or that the substantial change must have occurred within the subdivision itself. ***(ON FINAL: However, if you build 2-story houses and this breaks a covenant, it does not allow you to then build a 7-11)

a. This defense is rarely used in courts at law.

4. Defeasible: If the condition occurs in which the covenant was dependent upon.

5. Release: Obtaining permission from everyone (100%) to be released from the covenant.

6. Abandonment: When the covenant is breached and others dont do anything about it. They may abandon their right to sue. They dont need intent to abandon as they do in easements.

7. Prescription: If others dont sue when you breach a covenant and the statute of limitations begin to run, and if they run out, you get it by prescription.

8. Estoppel: If you rely on others saying it is OK to break the covenant (this gets around a lack of writing requirement in the Statute of Frauds).

IV. VENDOR AND PURCHASER

A. Process of Selling Real Estate

1. There is almost always a K of sale when real estate is linvolved.

2. 1st the seller enters into a listing agreement with the agent/broker.

3. Property is then listed

4. Exclusive Agency= The agent is the only one to get a commission no matter which agent sells it

5. Exclusive right to Sale= If property is sold whether by you or an agent, the agent gets the comission.

a. However, you can list exceptions that they get no commission on certain buyers if they purchase the property. (ex= If I sell to Dr. Whitman then you get no comission)

B. Comission for the Agent.

1. If an agent puts the property on the "multiple Listing Service" then there is a split agreement that the original agent share a % of comission with the agent that sells the property.

a. When an agent finds a listing in the MLS, he is not an agent of the buyer, he is a sub agent of the seller.

b. If you are buying property, ask the agent who is showing you around to be a "buyers agent" this way you can be open and honest with them and they can still take 1/2 comission in the end for payment.

2. If the agent makes a sale and you decided ou dont want to sell, they can not enter a K of sale in your behalf, you do not have to sell. However, you do owe the agent the comission as if there was a sale.

3. If the buyer is not ready, willing and able to pay for the house, you do not owe the agent commission, as it is not a valid sale.

4. If at one time the buyer was ready, willing and able, comission is owed.

5. You do not have to pay the comission until the closing

a. If the buyer pays in installments, you can pay the broker in installments too.

C. What Happens During the Executory Period of the K

1. Title Search: Done through a replica of public records called a "title plant".

a. Can look up a parcel of land to see its past history

b. In court houses you look at the names of the parties who sold the property (this can be very time consuming)

c. You can get a title insurance policy so you are assured that the info about your property is OK. They are strictly liable for any mistakes.

2. Arrange financing

a. Often the vendor will have an existing mortgage on the property when he wants to sell the property

1. He can have the purchaser take over and pay off the existing debt

a. The buyer can "take subject to"

b. he can assume the loan

c. If there is a "due on sale" clause, the purchaser may/may not be able to assume the loan. It is up to the creditor. They may req. compensaiton of this (Either an increase in the rate ot charge an assumption fee)

b. The purchaser may just make payments to the vendor= PURCHSE MONEY MORTGAGE

c. INSTALLMENT CONTRACT= The same as a purchase money mortgage, but here, the vendor retains title and does not give it to the purchaser until the last payment is made.

1. If the purchaser misses a payment, the FORFEITURE REMEDY can take place, and the vendor can cancel the K, keep the money and the purchaser has lost out.

d. Mixing and Matching (can be done with the following:)

1. New 3rd Party financing: New loans from banks, etc.

2. Assume/ take subject to

3. Purchase Money Mortgage

e. There are 3 kinds of Lending Institutions:

1. Commercial banks

2. Savings and Loans

3. Mortgage bankers: Dont have musch $, they sell their loans on a secondary mortgage market to investors. They mainly do residential property.

a. ex.= Fanny May (Federal Office) and Freddy Mack

f. Insurance

1. Mortgage Insurance: Insurance against the risk that the borrower of the mortgage loan wont default.

a. The lender is the insurer; the buyer buys the policy and pays the premium.

2. FHA= The buyer must pay off the principle as well as the loan by the time it is due. If they dont pay, FHA will. You pay a premium for the insurance that they will pay if this happens.

3. There are also private mortgage insurance companies.

4. A lender will lend you more money if you have mortgage insurance (up to 95% compared to 80% of the value of the home).

g. If the vendor wants to finance the purchaser and the purchaser couldnt get financing from the bank. If the K specifies that the purchser must get financing from an institution, the purchser can get out of the K and doesnt have to get financing from the vendor.

h. The purchser has a duty to try and get a loan. If there is a condition that you will try and get financing, there is an implied covenant of good faith that you will apply for one.

1. Covenant= promise to do something

2. Condition= Failure to do is the basis to discharge the K.

3. Appraisal of the property (You need this if you get financing from an institution)

4. Inspections of the property for problems

5. Warranty on the home

6. Survey of Property: Determines the boundaries of the land.

a. Surveyors carry errors and omissions insurance. You must prove that they were negligent if they made mistakes in order to get damages.

D. Discrimination in the Sale of Real Estate

1. If a person refuses to sell a house on the basis of race, is it a violation of the 14th Amendment? NO. Because the 14th Amendment prohibits Fed and State action but does not prohibit private actions.

2. Fair Housing Act: Holds liable those people who seel property and discriminate against people on the basis of race, religion, color, national origin, sex, marital status, handicapped or familial status (having children under 18).

a. ex.= AIDS: No real provision in the statute, can maybe fall under handicapped.

3. 42 USCA 1982= All racial discrimination, private as well as public, in the sale or rental of property is barred. (This deals with all citizens of the US)

a. If a person refuses to sell some small office building on the basis of them being from an Islamic country, are they in violation of 42 USCA 1982?

1. Yes, because the statute deals with race

2. No, because they are denied on the basis of being from a different country, and this does not fall under the race category.

b. It is not clear what the real basis of discrimination is.

E. Statute of Frauds

1. Does not require that the contract is in writing for the sale of real estate.

a. However, some K or memo thereof must be in writing.

2. Information that needs to be in the writing:

a. 1/2 the staes say the price/terms of payment need to be there.

b. Location (description of the property)

c. Signature (of the party to be charged)

1. If the real estate broker signs for the buyer, it is not binding. They dont have the power of attorney and are not authorized to do this.

d. Names of the buyer and the seller

e. Words indicating that a purchase is intended.

3. Tells us minimal what needs to be in writing. Doesnt deal with enforcing terms that are left out of writing. Parol Evidence deals with this.

4. Writing does not have to be introduced as evidence to sho it existed. It is a good way to prove thewriting existed, but there are other ways such as testimony, etc. to show the the writing was created.

5. If the Statute of Frauds is not satisfied by the K, the K is not null and void. However, it is unenforcable in court.

a. If part performance then courts will enfore a K no matter if it violated the Statute of Frauds.

6. If you have a K to buy a house, with no writing and no part performance, and you sue in specific performance to buy the house. If they admit under oath that there was a K though it was not in writing, there is a K and they must comply with it.

F. Part Performance

1. You can only recover equitable remedies (specific performance, etc). Clearly you cannot get $ for damages.

2. Requirements (at least 2 of the following)

a. Payment

b. Possession

c. Substantial improvements

3. Earnest money (down payments) are not enough.

4. Policy: This shows that there was reliance and provides evidence that there was a K.

5. Acts showing proof of part performance:

a. Vendor withdrawing from other offers

b. Vendor purchase other property.

6. Either vendor or purchaser can use his own acts of reliance to enforce the K.

7. If purchaser makes substantial improvements and then doesnt want to enforce the K but the vendor does, even though there was no real reliance by the vendor, courts are moving in the direction of holding purchaser to the K.

8. Remedies for Non-Breaching Party

a. Damages

b. Specific Performance

c. Restitution and recission

G. Taking of Title

1. Within 20 days, the vendor should deliver to the buyer as evidence of title:

a. Merchantable Abstract

b. Owners guarantee policy of title in amount of purchase price.

c. Owners duplicate certificate of title.

2. Doctrine of Merger: If the K says something about the title, you can only assert remedies under the K until the deal closes. Once you get the title, you can no longer get any remedies.

3. If you havent read the existing covenants, do not take title subject to what you dont know about.

a. However, agreeing to take subject to the covenants, does not mean that you are agreeing to take subject to their violations.

4. If there is a violation of restrictive covenants by the previous owner and you buy the property, you can go to the title ins. policy and sue on it.

5. Public ordinances (such as zoning, building codes, etc) dont effect the validity of title.

a. ex. Lady in Palm Sprongs where she bought lots and couldnt build on them becasue of building code, but still had the property and couldnt sue on title defect.

H. Marketable Title

1. If you do not agree to take subject to the following when you buy property, if any of them are there, the title is not marketable. (It doesnt matter if you know about them, you must agree to them or the title is not marketable)

a. If not property in fee simple absolute

b. If there are easemetns

c. If there are leases or mortgages on the property

d. If there are covenants on the property

e. If a reasonable person would object to it.

f. If there is an adverse posessor on the land (reason= he has "diseized" the title away from the original owner)

1. One aspect of marketable title is that the property is not subject to unreasonable litigation. However, case law is divided on this.

g. If the property is land-locked

2. If the purchaser decides not to purchase the land becasue there is not a marketable title, he can get all of his out of pocket costs (survey costs, title chech costs, etc).

a. He can also get expectation damages (ex. if the prices have gone up) while he was trying to purchase the original property and now must go back into the market.

1. Courts are divided on this and say that if the vendor sold in good faith the property without a marketable title, then the vendor wins. Purchser wins and can get damages if it was in bad faith. Bad Faith= You knew your title was defective when you put it on the market.

I. Deeds v. Titles

1. Deeds=a piece of paper; title=what law says who owns what

2. Deeds pass title, THEY ARE NOT THE SAME THING.

3. Deeds pass everything that the vendor has. The only difference between kinds of deeds= what you can do if you find out the title is not marketable

a. Quit claim deed=no remedy at all

b. Warranty deed=has remedies

c. If the K doesnt specify the type of deed the buyer is to receive, us the custom and what is typical of that locality to determine which kind.

d. By taking a deed is like saying you are satisfied that they have complied with the K.

4. A deed is not a contract. It is a conveyance; it moves the title from one person to another.

a. A deed can have K provisions in it (ex. covenants on use of land, covenants saying that the title is good, etc)

b. If the deed doesnt mention the title= a quit claim deed.

5. A deed transfers title after 2 things happen:

a. Is signed by the grantor

b. Is delivered

c. Does not need the grantee's signature. If the grantee accepts the deed, he is deemed to have agreed to the covenants in it, even if he doesnt sign it.

6. Essential elements to a valid deed:

a. Must be in writing.

b. Does not need witnesses

c. Does not need consideration (though most have it anyway)

d. Does not need a date on it

e. Does not need to be notarized/acknowledged

1. This is a requirement for it to be recorded, but is not necessary for it to be valid.

f. Does not need to be recorded

g. Does not need a seal.

7. To make a deed a conveyance just use language such as:"I grant" or "I sell" or "I hereby convey". There are no essential magic words.

8. If you make a deed to a dead person it is void. (Dead people cant take title to land)

a. Some cts. say yes other say no for deeds to corporations that have not yet been formed.

9. Delivery of Deeds

a. If a deed is delivered, then a will cant erase it (you cant will property that you dont own anymore)

b. When you deliver a deed, it becomes effective to the new party at that very second.

c. Delivery depends on:

1. some physical act

2. Intent to make the deed operate now

a. If you have the intent for it to operate at your death=no delivery

d. Recording of a deed shows some intent to make a deed effective now. (Remember: this is not a necessary element to make a deed valid though)

e. Wills are revocable when you are still alive

f. If deeds take hold at death but are delivered now, they would act like a will without the formality of execution

1. If we have something that really is a will, we should have to go through the formalities or it is void.

g. There might be a valid delivery of a deed even though it doesnt get into your hands

1.ex. If you put it in a Security Box

h. If deeds are put into your hands, but there is no intent to give you the property now=Not a Valid delivery

i. If you tell others that you have the intent and you are transferring the deed to someone, even if you put it in the drawer, telling is enough of an act probably to constitute a valid delivery.

j. Reasons why someone would put the deed in a box without telling the other person where the deed is, and only promises the property to them when he dies:

1. He wants to reserve the right to change his mind

2. He wants to avoid probate

k. It is perfectly OK to give a deed where they cant take posession of the property until something happens. It is the delivery you cant put off until you die

1. Ex. You can deed "all of my property, if and when you survive me"

a. This was delivered

b. This was an act

c. There was intent to pass now as a springing executory interest.

l. If you execute a deed and the court says that it is actually a will, if you took the formalities of a will (witnesses, etc,) it should save the deed as a will. However, some courts say that this is void as a will.

m. To Avoid All This Hassel:

1. Create a Revocable Inter-Vivos Trust

a. You are able to direct where you want your property to go when you die

b. Doesnt go through probate

c. dont need witnesses

d. Can reserve rights to revoke before you die

n. Escrow Holders= Person who gets the original deed from the grantor and delivers the deed to the grantee when the conditions specified are satisfied. (He does not create a new deed, he merely holds the original)

1. As long as you have a 3rd person, it is OK to hold delivery (even if it is held unitl the grantor's death)

2. However, if the grantor tells the escrow holder that he reserves the right to get the deed back, the deed is no longer valid as a delivery to the 3rd person when he eventually gets it.

J. Equitable Conversion:

1. As soon as the K is signed and enforceable, if damage occurs to the property, there is no excuse for the purchaser no to buy the property

2. If damages occur before closing, you may get a court order for the seller to repair the damage. (THis is one remedy, you could also reduce the purchse price so the buyer can repair the property himself.

3. If there is a lot of damage, the purchaser can rescind. He cant if there is a little damage (because this is a non-material breach)

a. The court doesnt say if the purchaser can get reduced price for the property instead of recinding if there is substantial damage.

4. It is difficult to determine what substantial is.

5. Risk of Loss: If there is nothing in the K to say differently, the common law applies. This states that the purchaser has the risk of loss if damages occur after signing but before closing.

K. Uniform Vendor and Purchaser Act

1. If when neither the legal title nor posession has been transferred and all or a material part of the property is destroyed, the purchser can rescind. (We still dont know if he can reduce the price though)

2. If title has been transferred, the purchser must swallow the damages, for it is his property as soon as the title or posession transfers.

L. Insurance:

1. Vendor is most likely to have this on the property while the process is going on.

a. The purchaser gets the benefit of the insurance by being able to abate the purchase price if something happens to the property.

2. If (very rare) the purchaser has insurance on the property, the purchaser gets the insurance money and can do with it whatever he wants. He does not have to give the money to the vendor.

M. Time for Closing

1. If there is a specified date that the K should close, you can still close 10 days later.

a. This is a breach of the K, but the K is substantially performed.

b. The breacher can still enforce the K as long as it is a reasonable amount of time.

1. Depending on the circumstances, this can be up to 30-60 days.

2. The breacher is still liable for any interum damages (ex. rent, taxes, utilities for extra time, etc.)

2. What makes Time of the Essence when closing:

a. If a clause in the K that says so

b. If the purchaser or vendor knows that the other party needs to close on time

c. Volitile real estate market

d. Unilateral oral statements that say so. These must give a reas. amount of time before the set date.

1. But if it is not within a reas. time (ex. have 3 days to close without notice) this rule doesnt work.

N. What Happens when you buy a house and it falls apart?

1. Can recover under:

a. Implied Warranty/covenant

1. Is the easiest term to disclaim by express conditions.

2. This is also the most difficult to recover under.

b. Tort (negligence)

c. Tort (strict liability)

1. Easiest to recover on this because you dont have to prove negligence nor do you need a K.

d. Misrepresentation/fradulent conduct (ex. haunted house)

1. Can be disclaimed by expressing the problem (must be pretty specific though)

e. The theory that you choose to sue under affects the statute of limitaitons.

1.Cause of action arises differently according to the theory you sue under.

2. In K law the claim arises when the K is performed or signed

3. In tort law= Use the discovery rule

f. Statutes of Repose= pays no consideration to discovery. If a certain # of years has passed since the property was sold, the claim for defects is barred.

2. Covenant vs. Warranty

a. Covenant=a promise

b. Warranty=A statement of fact (ex. on the back of a watch=a warranty and some covenants)

3. If the builder is not a professional (has only built one house) should he be liable to future buyers, or should caveat emptor (buyer beware) take hold?

a. Caceci (NY): Held that there is an implied term in express contracts between the buillder/vendor and the purchaser that the house is done in a skillful manner free from material defects.

b. A Washington case had a different standard and held: Implied warranty is one of habitability, which is defined as relating to egregious defects in the fundamental structure of the home. This does not apply to defects in the exterior or nonstructural elements adjacent to the dwelling unit.

4. If the building is structurally OK but building cods are violated, the builder is liable to come in and make the repairs.

5. If your house conforms with the regulations and specifications, but these were junk, you cant sue the builder nor the person who approved them. But if the builder deviates from the specifications you can sue.

V. DESCRIPTION AND BOUNDARIES (see class notes for the exampoles that he wrote on the board which explained how many descriptions are not complete)

A. 3 Systems for Describing Land:

1. Governmental survey System: When the government decides what the boundaries are

2. Meets and balence System: Starts at some monument and then describe from there where you are going.

a. Each land has a point of beginning

3. Record a Subdivision Platt and then refer back to this.

B. Township= A land-descripter. It is not a politicla subdivision.

1. There are more than 1 township and section in each county (unless the county is extremely small)

C. There are 640 acres in a section

1. "Acres" doesnt specify the shape of the land though. This term may be deemed by some courts as so ambiguous that the deed is void.

D. Very few lots have boundaries that ate precisely North/south /East or West

E. Whitman Advises: Dont go around writing legal descriptions of land; hire an engineer or a surveyor to do it and then check their work.

VI. RECORDING ACTS

A. Remember, a deed needs to be delivered to be valid, it does not need to be recorded.

B. However, sometimes recording can make a big difference, especially when a 3rd party comes into the picture.

C. The recording system= A library; you must fo and look up things yourself; they wont tell you over the phone if something is recorded or not.

D. A few states follow the Torrens System: They will tell you who owns the land without you having to look it up. (Very few properties are listed here though)

E. ex. O deeds to A on 1st day. On 2nd day he deeds the same land to B.

1. The common law says that A would prevail. This is because O has no title to pass to B on day 2. However, recording acts can reverse this.

a. For B to win over A:

1. A MUST FAIL TO RECORD and (1 of the following)

2. "Notice Statute"= B must be a bonifide purchaser (must pay value and take without knowing that O deeded to A)

3. "Race Statute"= B must record 1st

4. "Notice Race Statute"= B must pay value, take without noitce and record 1st.

F. Before you can take your deed and have a closing, you must check the records right down to the exact time of the closing.

G. there is always an incentive to record, to protect yourself from 3rd persons who might enter into the pictuure.

H. Notice Statute: No conveyance is valid as against a subsequent good faith purchaser for value, unless it is recorded

1. Another form of the language states: "All unrecorded conveyances are void as against a subsequent good faith purchaser for value"

2. A has failed to make the system work by not recording the deed, thus B wins (even if B hasnt recorded)

I. Notice Race Statute: All unrecorded conveyances are void as against a subsequent good faith purchaser for value who records 1st.

J. Race Statute: All unrecorded conveyances are void as against a subsequent purchaser wo records 1st.

K. In general, recording acts are not limited to deeds, thats why it says "conveyances" in the definition of Notice Statute. This can apply to the recording of mortgages, leases, deeds, etc.

L. Typical example problem:

1. Day 1: O deeds to A (is unrecorded)

Day 2: O deeds to B (unrecorded, B is a bonifide purchaser)

Day 3: A records

Day 4: B records

2. In a Notice state: B wins (on day 2 because he is a BFP and A didnt record)

3. In a race state: A wins (he recorded 1st)

4. In a Notice Race State: A wins (B was a BFP, but A recorded 1st)

M. It doesnt matter if A is a bonifide purchaser in any of these statutes.

N. If B doesnt qualify under the recording acr (ex. if he is not a BFP or didnt record 1st, then use the common law saying that 1st in time is 1st in right and A wins.

O. Interests Outside the Recording Acts (These Take precedence to the Recording Acts):

1. Short term leases

2. Adverse Posession

3. Prescriptive Easemetns

4. Dower and Curtesy

5. Unfilled mechanics liens (revert back to the date taht the work was done)

P. Recorded Documents May Be Defective

1. after you search the title,you cant be sure that all documents foufind in the public record are valid. There may be:

a. Forgeries

b. Undelivered Deeds

1. If the deed is recorded but never delivered, it does not pass title (because an undelivered deed is void)

c. Defective acknowledgement

1. You cant tell by reading the deed whether there was a proper acknowledgement

d. Fraud in the execution

1. If you dont know what you are signing, the deed is void.

e. Revoked power of attorney

1. If the grantor revoks before the attorney signs the deed, the deed is void.

2. Title insurance covers all of these risks.

Q. To be a BONAFIDE PURCHASER:

1. Must pay value

a. This must be more thatn a nominal payments, it msut be substantial, though doesnt have to equal the fair market value.

b. Gifts do not qualify