Property II (new)

created through private negotiations
Easements
Real Covenants
Equitable Servitudes
(all about use NOT possession)

a right of one party to use another party's land
- right to use by dominant tenant (user)
- generally created by deed--> (deed must meet statute of frauds (or transfer of easement)
-property interest NOT an estate in land
-runs with the land not the person
example: driveway, private road

damages and injuctive relief (equitable relief)

Dominant Tenant- the one who purchased and owns the easement
Dominant Estate- land that benefits from an easement
Servient Tenant- owns a servient estate
Servient Estate- land that is burden by an easement

benefits land and not a person

benefits a person not land (does not have a dominant estate)

1. Grant
2. Irrevocable license/ easement by estoppel
3. Easement by implication
4. Easement by necessity
5. Prescriptive easement
6. Public Trust Doctrine

most common

a grantor can reserve an easement for a 3rd party (McGuigan can reserve lot 20 for the church even though M sold it to Peterson and Peterson sold it to Willard, Willard still has to follow the reserved easement)

License: privilege to use licensor's land but revocable at licensor's will
Exceptions:
- Irrevocable license, aka easement by estoppel or executed license
- License coupled with an interest: privileged to go onto the property to get your property

Expenditures by licensee
Reasonable reliance by the licensor
License irrevocable so long as its’s reasonably necessary for licensee to recoup his investment (if they paid \$10,000 in repairs, they can use until they reach \$10,000 of use)

Shearer v. Hodnette
1. Resources expended by licensee
2. Expenditure contemplated by the licensor (what the licensor expected the licensee to pay as a result of the easement--> i.e. paying the upkeep for the road in order to use it)
3. Benefit the licensor
Not an easement, it was by will to use the road, met all 3 elements above which means that it was IRREVOCABLE

1. Unity of title: at one point the 2 parcels were owned by the same person
2. Use is permanent: when implied was it inteded to be forever? (ex: plumbing--> clearly yes)
3. Use is apparent: visible under an inspection by someone who is an expert in that field
4. "Reasonably Necessary": beneficial to enjoyment of property
5. Severance of title

Title theory: use after a mortgage is not an easement
Lien theory: use after mortgage= easement and is transferred to purchaser at foreclosure sale

a use within one estate prior to the separation of the estate

arises when, due to a conveyance property becomes landlocked

1. No access to right of way (landlocked)
2. Unity of Title (at one point the 2 parcels were owned by the same person)
3. Reasonably necessary to enjoyment of land

- to make use out of land
- the party conveying or reserving the landlocked parcel intends to convey or retain whatever is necessary for the benefitical use of property

• Actual (use)
• Open and notorious (use)
• Exclusive (of other non-owners and owners uses inconsistent with adverse use) (does not have to exclude true owner)
• Continuous (use)
• Hostile and under claim of right
• Statutory period (adverse possession SOL is used)

o Connecticut- Objective
o Maine- Bad faith, knows they do not have easement and uses anyway
o Iowa- Good faith believes they have easement

If all 5 elements met then hostile is presumed and it’s the duty of the defendant to prove there was permission
- No permission to use = assumption of adverse and claim of right

1. Common law does not permit public prescriptive easements
2. Key difference between public and private prescriptive easements:
a. Use by public (not only one party) and
b. Public entitled to use the easement (not only one person)

1. Land covered by the ebb and flow of the tide, and all navigable inland lakes and rivers up to their ordinary high-water mark, are held in trust for public use (Maj)
2. Right to use that public has
3. What uses are the public entitled to?
a. Navigation, fishing, and Recreational use

allow people to walk on the dry sand to get to the water and wet sand, can use dry sand (to tan and relax etc.)
called association quasi-public
Maj: most states only apply public trust doctrine to public owned land
Min: public trust doctrine is applied to dry sands that were provately owned--> 5th amend is a restriction on that

ST/ Promisor promises to not act (in a specific way)

Light
Air
Water
Support
Modern Expansions: conservation and implied reciprocal negative easements

NOT allowed in US
Because: could catch purchaser unaware and harm marketability and lower value

Intensity of the use of the easement
a. frequency
b. type of the use
c. effects on the servitude esate
Size of dominant estate
a. effects on the servitude estate
b. how large is the property serviced by servitudes?
i. size of dominate estate when easement was purchased

1. Easement itself (“primary easement”)--> based on the type of easement (ex: driveway)
2. Reasonably necessary to use and enjoyment (“secondary easement”): uses of easement that are reasonably necessary to dominant tenants use and enjoyment
3. Reasonably anticipated future use in light of the circumstances: an additional type, frequency, and effect of use

Farmer v. Kentucky Utilities Co.
- prescriptive easement
- servient tenant can't interfere with dominant tenant's use and enjoyment
- mowing down vegetation to maintain electrice line is a secondary easement
- if primary easement there's an assumption there's a secondary easement

Penn Bowling Recreation Center v. Hot Shoppes Inc.
- bowling added to their land after easement was made, used easement to service the added land
- only dominant land can be serviced by easement (any expansion can't be served if it is then it's abuse of easement)

a. Different type of use
i. Commercial v. Resident
b. Intensity and frequency that is beyond residential scope
c. Effect it has

o Benefit: dominant estate
Transfer? Yes
Divide? Yes so long as reasonable
o Burden: Servient tenant
Transfer? Yes
Divide? Yes, burden remains on each of the divided parts

runs with the person
o Benefit: dominant tenant
Transfer?
CL: no
Modern (majority): yes if easement is commercial
Most modern (RS3d): yes if intended
Divide?
CL: no
Modern: no with exceptions (e.g. one stock rule: one who jointly works with another person to sell (exclusive use))
Most modern (RS3d): yes if intended
o Burden: servient tenant
Transfer? Yes
Divide? Yes, burden remains on each divided part

the right to take something from the burdened land, not stated if it is its corporal interest
(the right to go on one another lands to precure an indeterminate amount of resource)

Martin v. Music
- can be divided so long as ST is not unreasonably burdened
General Rule: assumed easements are appurtenant

Miller v. Lutheran Conference & Campy Ass'n
- P gets bathing through easement in gross
- can transfer easement if it is a commercial easement
- P divides benefit to Rufus --> ok b/c of one stock rule
- Rufus to D not ok--> no one stock rule here

Agreements between parties for one party (the promisor) promises to do or to not do something (binding on the people who later own the promised land)
Example: promisor’s promise not to build windmill on own property
o Limit on promisor’s actions or, promisor’s promise to act
o Generally created by contract
o Not estate in land, but historically not property interest
o Require contacts and privity (horizontal & vertical), touches the land
o Promise runs with the land

Damages

Writing that complies with statute of frauds
Intent to bind successors (intent to bind & burden the people after you)
Touch and concern (or reasonableness):
o Rule: a promise touches and concerns the land when it affects the land
o If promise affects the value of the land then it touches and concerns it
o Promises to pay \$ touches and concerns the land
o Skills sets don’t touch and concern land
Privity: Privity of estate and of contract (Horizontal and Vertical)

original two parties (promisor and promisee)
CL (Massachusetts): promisor and promisee must have simultaneous interests in the same land
Modern (majority): CL plus promises in deeds which transferred the grantors entire estate to the grantee
RS3d: no horizontal privity because it doesn’t add any value

Promisor rule: For burden to transfer vertically: the successor has to have the exact same estate as the original promisor (ex: fee simple to fee simple)
Promisee Rule: For benefit to transfer vertically: successor only has to have some possessory interest (ex: fee simple to life estate)

- All elements of real covenant met
- Promise to pay money touched and concerned the land
- Horizontal privity under majority
- Vertical privity: fee simple to fee simple
- D liable to P
- Covenant runs with land when there was an intent for it to run with the land, the covenant touches and concerns the land, and there’s a privity of estate between the parties seeking the covenants’ benefit and the party charged with its fulfillment

- Noncompetition restrictions can touch and concern land
- Touch and concern the land uses the reasonableness test using 8 factors on pg 691

- Association is no different than other property owners therefore the association is in vertical privity with the original promisee (realty co)
- Affirmative promises (promise to pay) touch and concern the land

- Limit on promisor’s actions or promisor’s promise to act
- Generally created by contract
- Not an estate in land but historically not a property interest
Example: promisor’s promise to build a windmill on own property
- Successor in interest have notice of equitable servitude therefore it is binding
Can be actual or constructive notice (reasonable person would know)

injunctive relief NOT damages

1) Writing that complies with the statute of frauds
Exception: implied negative reciprocal easement
(2) Intent to bind successors
(3) Touch and concern the land (or reasonableness)
(4) Notice to promisor’s successors
o Actual notice: expressly states
o Constructive notice: restriction in the chain of title (says it in the deed)
o Inquiry notice: a reasonable person would question if there is a restriction

Where a lot is sold with reference to a park on a recorded document concerning said lot, the purchaser is required to preserve the park

- Meets all elements of equitable servitude
- Inquiry notice--> entire area was residential should not be commercial
- Common grantor? Yes
- Implied negative reciprocal easement--> enforceable contract exception met

Rules to interpret real covenants
o Is language ambiguous? If so rule in favor of free enjoyment of property and against restrictions
o No implications on restrictions of use and enjoyment
o Interpret covenant reasonably but strictly
o Give words in restrictive covenant their ordinary and intended meaning
o Family is related and unrelated people acting like a family
o Group home=family not against the restrictions

(1) Abandonment: DT (person benefitting) does not want it anymore does NOT have to tell ST, just need to intend to abandon it then act on it
(2) Merger: one party owns both the dominant estate and the servient estate
(3) Condemnation by government: condemn easement of ST by paying \$ for it
(4) Prescription: ST eliminates servitude
(5) Release: the DT releases ST from the obligation of the servitude
(6) Natural expiration: sunset provision (time period it lasts) expires
(7) Destruction of the servient estate: servient estate is not land and it gets destroyed
(8) Equitable defenses
a) Unclean hands: ST is doing a similar thing as to what they are suing for (ex: building a driveway then blocking it)
b) Acquiescence: P has failed to sue a 3rd party to enforce a similar servitude
c) Laches: court doesn’t give equitable relief bc P unreasonably delayed bringing their action
d) Estoppel: court doesn’t give injunctive relief bc D relied on P’s representation
e) Changed conditions: unfair to enforce restrictions bc changed conditions make it invaluable

- Not using an easement does not suffice for abandonment
- Abandonment of easement must be purposeful
- No adverse possession of easements unless
o Need for right of way arises
o Demand made by owner of dominant tenement
o Owner of servient tenement refuses to do so

Intent + action= abandonment of easement

Conditions changed so much (quiet and religious to tourist and commercial) that its unreasonable to enforce the restrictive covenant of no alcohol

Real covenants and equitable servitudes (no majority rule its about 50-50)
o Unanimous consent required by many states
o Many states permit a majority vote amendment
But require reasonableness such as uniformity of application of amendment
Easements
o Unanimous consent required

Majority vote for amendment is ok BUT the amendment must be applied uniformly
Amendment was for 1 person--> not allowed

interference with the use and enjoyment of land
- 1 owner is using their land that's incompatible with another person's use and enjoyment of their land

(1) D’s conduct (actions or inactions when had duty to act) § 824
(2) Interfered with P’s interest in the use and enjoyment of the land § 821d
(3) Interference was significant (§ 821f) by the normal person standard
(4) D’s conduct was intentional/ unreasonable (§ 825)--> purpose or knowledge that something is likely to occur
a) Intentional (825(a) 825(b))
b) Unreasonable (§ 826a and § 826b are 2 different ways to show Ds conduct id unreasonable)
i. § 826a= injunction--> cost benefit analysis-->look at 827 for the gravity of harm factors, 828 utility of conduct (factors involved)
ii. § 826b= damages--> is harm serious and P gets damages only if Ds conduct continues aka don’t bankrupt the D
(5) P has an interest in the land § 821e

Permanent damages rather than an injunction are appropriate when the damages resulting from a nuisance are significantly less than the economic benefit derived from the party causing the harm

Private nuisance law is applicable when there is a dispute over access to sunlight

An intentional invasion of land will be unreasonable when the harm is caused is serious and can be resolved in a financially feasible manner

A court must weigh the landowners interest when determining whether an intentional interference w/the enjoyment of the land is unreasonable

- Received compensated injunction (can’t do feeding farm but is compensated for that)
- When the public develops land in the vicinity of a public nuisance the action creating the nuisance must be ceased by the party responsible for its creation however, said party is entitled to compensation

Lateral: to the side
Subjacent: below

to the side
o Strict liability
o When D excavates land too close to Ps land--> Ps vertical stability is ruined bc it falls into Ds excavation
o CL: natural state of land
o Modern: natural or developed state

below
o 1 person has fee simple for surface rights and one has a fee simple for mineral rights
o Strict liability if surface land collapses due to mining
o CL: natural state of land
o Modern: natural or developed state

nor shall (1) private property (2) be taken (3) for public use, (4) without just compensation (fair market value)
(applies to state and federal government)

1) Rational basis review (deferential to gov action--> give benefit of the doubt)
o Public use
2) Intermediate scrutiny
o “Exactions” cases (Nollan and Dolan) (gov't is excating something in exchange for a permit)
3) Strict scrutiny (always against decisions unless strong reasons given)
o Not applicable

- Government takes formal legal action to acquire title to private property
(gov says hey property owner we're taking your property; no question if property is taken or not)
- Power federal and state government have to take private property for public use
- Police power
- gov is plaintiff here

- Government takes action that property owner claims are the equivalent of eminent domain
- Property owner= plaintiff, sues for just compensation
o Government takes land not in formal legal action and P received no compensation

(1) Government title: government ownership
(2) Government takes land and transfers to private property legally obligated to permit public use

o Public purpose (most states do not accept)
is the government rational pursuing a legitimate state interest?
o When gov takes land from 1 private party gives to another private party for private use (Broad)

- Public purpose counts as public use
o Anything that is police power is public purpose--> public use
- Economic development= public purpose
- Taking private property giving it to a private company served public purpose

Blighted= unfit for human use
Used rational basis of review
(1) Did DC have a legitimate state interest?
Yes to get rid of blight--> police power
(2) Are means rationally related to the end?
Using private property is rational means to the end to get rid of blight

Used rational basis review--> means rational to end?
o Any police power is ok… breaking up oligopoly= end
o The taking of property is a reasonable means to breaking up oligopoly

- Public use= public benefit
- Economic development= public benefit
- Supports kelo

3 reasons for eminent domain
1) public necessity (necessity of the extreme sort otherwise impractical)
2) private entity is accountable to the public in its use
3) public concern

monetary damages measured by owner's loss
owner's loss= fair market caule
fair market value us a question for the jury

Per Se Rule: permanent physical occupation is a taking
Denies all economically benefitical use rule: is a taking
Diminution in valuse test: if a government regulation of us (that is not a nuisance)
"goes too far" is a taking
thwarts "distinct investment back expectations is a taking
Police Power rule: if government acts beyond its police power (to abate a nuisance), then a taking

o Loretto v. Teleprompter Manhattan Catv Corp.
Permanent physical occupation is a taking
o Horne v. Department of Agriculture
Loretto rule applies regardless of benefit to the property owner or public
Extends Loretto rule to personal property
Taking raisins from farmer is a taking

Lucas v. South Carolina Coastal Council
Denominator is always state law but court said don’t use the penn central test
Court looked to if regulation deprived owner of all economically benficial use as defined by state law
If so--> taking
If not--> no taking
There's not a deprivation of all economically beneficial use if the restriction was already baked into the title
The above chart: use was never restricted in the title before the restriction came to be--> compensation if it was in the title no compensation
Palazzolo v. Rhode Island
Lucas really means property is valueless (to be denied economically beneficial use)
Skeptical of geographic division of parcel of land
Passage of title alone does not create Lucas background principle (does not mean regulation wasn’t already in the title)

Avulsion (loss of or addition to land by the action of the water states get the avulsed land) is not a taking

Temporary physical recurring action= taking because it is the same character as a permanent continuous act

New test: the Murr test
(1) How does the state/local law treat the property
(2) What are the physical characteristics of land?
(3) Property owners reasonable expectation (how did the property owner utilize his property in the past?)
o Plus reasonable expectations--> is regulation baked in state law, physical characteristics, and value
o Modification of Lucas, does not overrule Lucas

3 factors to “it goes too far” test:
I. Favors one class of people over another
II. Notice can avoid the damages/protect public interest
III. No reciprocity of advantage (people are burdened but both parties come out advantaged)

(Value of right taken) numerator (value of right taken)
-------------------- = ----------------- = ------------------------
? denominator (state law (Holmes))
must determine the denominator for the "goes too far" test
who decides what the denominator is?
maj view say the state law decides
min view says the justices will decide what they perceive is the best

Penn central--> 3 factor test:
Diminution of value test
I. Economic impact of regulation
i. Economic impact: does the restriction have a reasonable rate of return?
ii. Distinct investment backed expectations: change property for new use, does the regulation prohibit the new use
II. Character of government action (invasion of property vs. regulation of use)
III. Regulating nuisance like activities (police power analysis)

Physical invasion alone is not a taking
Used diminution test
1) Character
2) Economic impact--> will profit be diminished?
3) Interference with reasonable investment backed expectations

if government acts beyond its police power (to abate a nuisance) then it is a taking
Mugler v. Kansas
Any regulation of use= police power--> regulated use is never a taking
Pa. coal (Brandeis dissent)
Denominator should be what the justices think, not the state law

all government does is regulate the owner's property use
1. Regulation of "use" of property = taking
2. Difficult-to-draw line between police power and eminent domain power (taking)

damages for taking during the period in which regulation was in force
- where the taking is temporary and amounts to a loss of projected income, the correct measure is the lost income itself
- where the taking is permanent, damages are measured by the difference in the market value of the property as unencumbered and its value when subject to the offending regulation

state can enact regulations to help the public health safety (public morals and public safety)

Physical Appropriation

do NOT work together

granting a property permit with conditions attached
intermediate scrutiny

3 steps
1. Condition is a permanent occupation and therefore a taking (Loretto)
2. Essential nexus test: must have a relationship between the condition and the original purpose of the building restriction (the nexus is between the means pursued and the end they want to achieve)
If nexus exists: legit police power-->no taking
Nexus does not exist: taking
3. Means = easement End = public access, was there an essential nexus between the two?

Used essential nexus test but added to it/modified it
o Rough proportionality test
Must have a rational relationship between the means and the end AND the feared impact of development
In this case, the means to prevent the harmful impact is not roughly proportional, it is over inclusive (taking more than necessary to prevent the harm)
o Unconstitutional conditions doctrine: government can’t condition a discretionary government benefit on the relinquishment of constitutional rights

o Unconstitutional conditions doctrine: denial of permit for not wanting to comply with conditions
o Used Nollan and Dolan--> taking under both rules

Public land use regulation
- public in creation and in implication
Identifies different areas for different uses (industrial; residential, etc.)
Done to benefit society

o Is what the zoning is restricting better than the set of land uses created by some alternative system? (servitudes, nuisances, or other CL rules like AP or prescription)
o Do the costs of zoning justify the improvements?

- Zoning is constitutional unless clearly arbitrary and unreasonable
- Zoning can be cumulative

- Zoning enabling act: says who can do zoning and under what parameters
- Municipal comprehensive plan: involves a map of entire jurisdiction with uses in each area, comprehensive description of what the uses mean and who creates and enforces zoning
- Municipal zoning ordinances: which part of the city has what use
o Zoning commission: body that enforces the zoning ordinances
o Zoning board of appeals
Appeals: adjudicate appeals from zoning inspector
Amendment proposals: if someone wants to amend zoning they go to the board

(1) Use
Cumulative: best uses and least favored uses, way to distribute by the ranking
Exclusive: all uses are the same rank, just need to be distributed equally (states follow this today)
(2) Lots and building

1. State authorizations to zone limit zoning
2. Federal and state constitutions limit zoning
a. Takings Clause
b. Due Process Clause
c. Equal Protection Clause
d. Free speech and Free exercise Clauses
3. Federal and state statutes limit zoning
a. anti-discrimination laws
b. environmental laws

Zoning enabling act is a limit on zoning (although the township didn’t violate it)
Due process federal due process is not much of a limit on zoning
State employed the state due process clause (more of a limit)
Rational basis review
Are the means rationally related to the goal?
Goal: traditional family structure and values
Means: zoning
Inexact way of achieving this goal --> unreasonable violates the state constitution

- If code standards are too vague it violates due process
- Standards were so vague you had to guess --> violated due process

- Rejection of changing zoning to R-5 has racially discriminatory impact
- Must have racially discriminatory intent to have violation of equal protection clause
o No proof of intent, the commissioner and board had good reason and followed procedure
o Discriminatory impact is NOT intent
- Equal protection clause is a limit on zoning but it is a weak limit

- Must be a reasonable variety of housing available
- Needs to be a fair share of the region
- What counts as a regional need? (driving to get groceries, drive to work are all regional needs)
- Burden shifting analysis to prove the above 3 elements
- Plaintiff must show municipality has not met one of the 3 elements
- D must show municipality has met elements of why element need not be met

- Zoning enabling act: gives power, process, purpose to zone
- Home rule provisions:
o Constitution/stautes gives municipalities power to zone in a less strict way

Municipality has to consider welfare of the entire region when it enacts a statute with effects that go beyond its boarder

1. Zoning ordinances implement comprehensive plan
a. amendments change the ordinances
2. Spot Zoning is amendment that classify parcel inconsistent with plan
3.Standard of review of amendments
a. Federal: rational basis review
b. State:
i. Rational Basis: burden on challenger (maj)
ii. Fasano Doctrine: burden on government for both facts and law
(Judicative in nature not legislative) (reasons and evidence if gov fails they lose)

Legal spot zoning: reasonable distinction between the parcel and the surrounding land
Illegal spot zoning: not a reason for distinction between the parcel and the surrounding land

Factors of reasonableness for spot zoning (majority):
o Whether rezoning is consistent with the police power
Must be related to public (health, safety, morals, or general welfare)
o Whether there’s a reasonable basis for distinguishing between spot zone and surrounding property
o Whether rezoning is consistent with the comprehensive plan

Referendum to determine whether to allow a zoning change is constitutional because gov power is derived from the people

Administrative exception to application of zoning ordinance
o Land use device, must be attached to land not to a particular occupent
2 standards, depending on the type of varianceo
(1) Use variance
( 2) Area variance

(residential use, industrial use etc.): uses undue hardship standard
Undue hardship: no reasonable rate of return if property is used as zoned
No reasonable rate of return + unique characteristics + not alter character of locality

(set back requirements, height requirements etc.): uses practical difficulty standard
Practical difficulty: no consensus on meaning but it is less rigorous than undue hardship
Can you fully enjoy the use of property without variance?

Undue hardship test:
o There was no lack of a reasonable return could have built a smaller home, the lack of return was due to human error for not following guidelines
o Buck couldn’t prove the property couldn’t yield a reasonable return

Variance: use that deviates from zoning, with permission, run with land
Special exception: use expressly authorized by zoning, run with land

Definition: legal use in effect prior and contrary to zoning ordinance
- Reasonable amortization period: amount of time before allowed before to conform to the zoning ordinance
- May not significantly alter nonconforming use
- Nonconforming structures have stricter standards

o Nonconforming uses of land
o Nonconforming buildings
o Nonconforming uses of conforming buildings
o Conforming use of nonconforming buildings

Prior nonconforming use
o Was amortization period reasonable? Court said reasonable on its face
Reasonable time and needs to be rationally related with legitimate state interest

Conditional zoning: conditions imposed in exchange for zoning changes --> illegal
Floating zones: zoning when requested
Planned unit development: developer discretion
Contract zoning: bilateral agreement between landowner and sovereign --> legal

St. Onge v. Donovan; Driesbaugh v. Gagnon
Conditions imposed upon land by a zoning board must be directly related to and incidental to the proposed use of the property

Common law:
o Can have any reason or no reason at all to exclude people from housing
Statutory modifications to CL:
o Federal protected classifications:
Race, color, religion, sex, national origin, familial status (you have kids or kids are on the way), and handicap

The constitution applies only to the government (federal and state) and government officials… NOT private action

Affirms state action doctrine (private racially restrictive covenant [cant sell your home to black or Asian people] isn’t violation of constitution because it is not a government action)

But state court enforcing private agreement is a state action and it violates the equal protection clause

All citizens have the same right to purchase own and convey personal and real property

Two theories of proof: (1) Disparate Treatment and (2) Disparate Impact

(1) P must show prima facie case
(2) D shows legit nondiscriminatory reason
(3) P shows pretext (an explanation that tries to justify the discrimination but it really is just a shitty excuse -->basically P has to show that the legit nondiscriminatory reason isn’t actually legit)

-P tries to show D intentionally mistreated P under FHA
Disparate treatment prima facie case
(1) P is a member of a protected class
(2) P applied for and was qualified
(3) P was rejected and
(4) The opportunity to rent/purchase remained open

-policies had the impact of discriminating under FHA
Prima Facie Case
(1) D’s actions/policies had adverse effect on protected class

4 conditions in which single family residence is not bound by 3603
- 3 or fewer single family residence has only 1 sale in any 2 year period, does not use a real estate broker and does not advertise
- Multifamily units: if the person owns a 4 person residence (quadruplex) and lives in 1 of the units, 3604 does not apply

Religious organizations can exclude other religions from buying or renting

Allows state and local government to create communities for the elderly

Civil act is broader (depending on situation but mostly FHA is broader)
FHA covers a wider scope
o Covers many activities, more people, and characterizes states intervention and advertisement

Sex
Quid pro quo: LL/property owner says I’ll give you a benefit if you do a sexual favor
Hostile environment sexual harassment: whether LL or Property owner’s actions reasonably likely to humiliate or intimidate on the basis of gender

Buyer search --> selection by buyer --> negotiations --> sale contract --> performance of contract --> closing --> buyer possession

(1) In writing
(2) Identify parties
(3) Identify land
(4) Give consideration
(5) Signed by person in which enforcement is sought
(6) Other “essential” terms (varies)

Elements (must have 2 of 3) --> Partial performance of an oral contract can satisfy statute of frauds --> applies to oral agreements/anything not in writing
o Partial or full payment of purchase price
o Delivery of possession pursuant to contract
o Making improvements by purchaser

(1) Actual damages are difficult to measure AND
(2) Proportional to actual damages
Occur in the contract and come back again when you try to enforce them

(1) Title that is reasonably free from doubtful questions of law or fact
(2) Implied condition in land sale contract

o This means that the title is unlikely to result in litigation
o Example: say you have a fee simple but really have a life estate --> likely to result in litigation
o No caveat emptor for defects in title

o If title is defected/clouded, buyer must notify seller and seller has a reasonable time to cure --> closing then gets pushed back until reasonable time ends
o Seller can modify what seller is promising to give
Estate doesn’t change the confidence in what title seller has changes
Example: Seller thinks they have a fee simple but really have a life estate -->changes giving a fee simple to giving a life estate

Must comply with statute of frauds for sales of realty
Needed to expressly state consideration --> wasn’t expressly stated contract unenforceable

Implied duty of good faith in performance of land sale contract

Buyers didn’t make a diligent effort to get financing (not good faith effort) cant rescind contract
Commercially reasonable standard --> is it reasonable to take a bridge loan? Yes unreasonable to reject
Liquidated damages clause was reasonable

Defect in title= encroachment --> NOT a marketable title --> encroachment causes litigation with the city

Damages
Specific Performance

Both parties can get
Expenses and ernest money (a deposit that holds the house for you --> shows you have the intent and resources to buy the house)
Benefit of the bargain (market price minus contract price) to seller
If seller made a good deal that they lost due to buyers breach
Benefit of the bargain to buyer
Yes, if seller acted in bad faith
American rule: yes always (doesn’t matter if seller acted in good faith)
English rule: no if seller acted in good faith
If market price is high then buyer benefits, if market price is low then seller benefits

buyer and seller can do this

Land is unique and NOT fungible, so damages are inadequate

Doctrine of mutuality of remedy: Buyer and seller are entitled to specific performance (only non breaching party can request this)
Doctrine of equitable conversion (damages not adequate)
Sellers interest in land is converted to personal property, buyers interest in land converts to real property
Buyer becomes “equitable owner” of land and seller becomes “equitable owner” of purchase price

(1) Risk of loss doctrine (majority position): buyer bears loss if subject matter of land sale contract is damaged or destroyed during period of execution
(2) Seller death: seller’s heirs must convey land’s legal title to the buyer
(3) Buyer death: buyer’s heirs must convey consideration to seller

(1) If loss is caused by negligence after of the seller --> buyer not responsible for loss
(2) If seller has insurance on property then the sellers insurance proceeds are held in a constructive trust for the benefit of the buyer who bore the risk of loss

o Buyers entitled to specific performance for whatever title the seller has
o Sanders gets Knapp’s title which is tenancy in common (specific performance to get this title)

o Court doesn’t give seller (P) specific performance doctrine of mutuality doesn’t apply as strongly today (minority rule)
Seller has to show damages are inadequate
o Get liquidated damages (\$525 deposit)

Grants specific performance only when the seller is unable after a reasonable effort to resell the property at a reasonable price or the circumstances reasonably indicate the effort will be unavailing

- Buyer defaults
- Seller defaults and unable to do specific performance
- Plaintiff elects damages instead of specific performance

Seller has no obligation to disclose defects/conditions that affect land’s value
Exceptions (fiduciary relationships)

Reject the English rule --> American rule is better (doesn’t matter if D acted in good faith)
Clarified that good faith is when seller has a commercially reasonable reason for breach

= land sale contract to closing

Storm caused \$60k worth of damages to property
Minority position: risk of loss shifts when the buyer comes into possession, eliminates any practical effect of the risk of loss doctrine
o Court followed this rule, ruled in favor of buyer --> sure fire bears risk of loss bc Brush was not in possession

Contractual promises that are fulfilled by the deed are merged into the deed and cant be sued upon after conveyance of the deed
o Promises that pertain to conveyancing of title are fulfilled by the deed
Example: marketable title requirement or seller promises to convey a fee simple w/o any incumbencies
o Collateral promises don’t merge
Not fulfilled by the deed
Promises the buyer/seller can continue to sue on

o Promises merge when they deal with the mechanics and conveyancing of title
Look at language, intent, and circumstances to figure this out
o Merger doesn’t apply to roof repair --> collateral promise

Implied promise in land sale contract between builder and initial purchaser that the house is fit for residential purposes

Implied warranty of habitability should exist for 3 reasons
Buyers cant inspect latent defects
Buyers have unequal bargaining power
Buyers rely on builder’s expertise
Extends implied warranty of habitability to subsequent buyers if its latent and they discover it in a reasonable time (minority)

Has to be in writing
(1) Must identify parties
(2) Must identify land
(3) Express grantor’s present intent to convey
(4) Must have grantor’s signature

(1) Premises: includes party names, consideration, description of land, granting clause (present intent to convey)
(2) Habendum: describes the type of estate being given, includes warranties and covenants of title (warranties and covenants= promises)
(3) Reddendum: reservations by the seller tin the interest being conveyed (here’s the fee simple but there’s caveats to it --> example: mortgages)
(4) Execution: execution by grantor and the date and the signature line
[5] Acknowledgment: notary --> necessary for state recording requirement but not necessary for deed to be valid

Letters were a plan, has present intent to convey in the letters
Meet all elements of a deed --> not a formal deed but constitute a deed

Metes and Bounds (oldest method)
Government survey to describe land
Plat Map (most comon method today)

Identifying a particular part and describe each part boundary by boundary (line by line) by identifying monuments (can be natural—boulders or artificial—markers) and describe by course (compass) and distance (chain link measuring amount of feet)
Not perfect --> human error

Government surveys are done township by township which is about 6 miles by 6 miles
Within the township they are divided by 640-acre parts (about 1 mile by 1 mile)

deed will reference a lot number on a plat that's recorded by county recorder's office

(1) Natural monument (boulders)
(2) Artificial monuments (roads, bridges etc,)
(3) Adjacent tracts and boundaries
(4) Courses and directions (compass to measure distance)
(5) Distances (how much space between 2 points using chain)
(6) Area or quantity of parcel (identify circumference and how much area there is within the circumference)
- Argument is the things higher up in the list are more patent and permanent therefore are more reliable than the items lower down

The artificial monument is more reliable than the metes and bounds measurement --> used the hierarchy to resolve ambiguity

Grantor intends that the deed be presently operative as conveyance of title for deed to be valid
Courts Presumptions
Has to be accepted by the grantee
Conditional grant
Delivery in escrow

can be physical delivery which is not always evidence for it to be presently conveyed

(1) Physical delivery of deed is presumed to be delivery
(2) A grantor retaining possession is presumed to be non-delivery
(3) Delivery of deed to 1 grantee is presumed to be delivered to all grantees
(4) Recording a deed by the grantee is presumed to be delivery

presumed it is always accepted bc its of value

grantor physically delivers grantee the deed but it only becomes effective when a condition occurs
o These are invalid because they this is NOT present intent to convey title, but you can get around it through fee simple condition subsequent

delivery of a deed by grantor to a 3rd party to deliver to the grantee upon the occurrence of the condition
o Commercial escrow: courts are allowed to facilitate commercial practices
o Death escrow: delivery of a deed by grantor to a 3rd party to deliver to the grantee upon the grantor’s death
Valid because grantor is relinquished his control of the deed which manifests present operative intent to transfer
o Valid because you are presently conveying your title to the 3rd party

Used 3 presumptions to decide delivery was valid
(1) Grant one grantee is to all grantees
(2) Grant to 1 family member is presumption of delivery
(3) Grantee records the deed then it is presumed delivery

No valid death escrow bc revocability of delivery to the bank (Harold could get the deed back at anytime and not give it to Jay)
No present intent to convey title (Harold remained in possession, paid taxes, etc.)

Common Law
Title Search
Title Insurance

Priorities: first in time first in right
Covenants (deed warranties): seller promises contained in the deed that the title seller is conveying is accurate
Estoppel

Warranty deed covenants
Quitclaim deed

Present covenant: promises that apply at the point of conveyance (when did is delivered)
Future covenant: promises don’t initiate at point of conveyance they do later if at all
Actionable when the deed is delivered (typically closing) till the statute of limitations runs--> typically 10 years
(1) Seisin (present covenant): grantor’s promise that he is seized of the title that the deed purports to convey (example: promise to give fee simple but gives life estate violates seisin)
(2) Power to convey (present covenant): same as seisin
(3) Against incumbrances (present covenant): grantor’s promise that the parcel isn’t subject to 3rd party interest other than those stated in the deed
(4) Quiet enjoyment (future covenant): grantor’s promise that the grantee will not be ousted by a party claiming superior title
(5) Warranty (future covenant): same as #4
(6) Further assurances (future covenant): grantor’s promise to execute documents necessary to perfect title to the grantee

1-5 is damages remedy
6 has option of specific performance (can get damages if they want)

interest that diminish the value of the property (ex: mortgage easements)

warranty deed protects a grantee from all incumbrances existing at the time deed is delivered even if the grantee had knowledge of the existence of incumbrances

no promises by grantor regarding quality of title

Defects may show up after closing but most of the time seller is out of the picture so nothing can be done
Even if seller is in the picture, most of the time they can’t cure defect
Can only get damages --> doesn’t make the buyer whole

grantor conveys lesser interest than deed purports to convey and who later acquires part or all of the purported interest, by operation of the law, passes the later acquired interest to the grantee

buyer will review chain of seller's title to ascertain quality of sellers title
Tract index search: method of searching by parcel
Grantor and grantee index search:
Look at all the past grantees
After 40 years or so look at grantor searching forward
2 limitations
Humans can make errors
Expensive and time consuming

Analysis for subsequent purchaser to trump the prior purchaser
Prior purchaser must fail to record and
Subsequent purchaser meets statutes requirement
Persons protected by recording acts
Bonafide purchaser for value
Purchasers who gave something of value in exchange for title and
Purchaser had no notice of prior purchasers’ interest

P was no bonafide purchaser for value, P had notice

who records first

at time when subsequent purchaser got title had no notice of earlier grant and prior purchaser had not recorded

An unrecorded instrument is invalid against a subsequent purchaser w/o notice
Prior purchaser didn’t record and subsequent purchaser has no notice <-- all that’s is required for subsequent buyer to beat prior buyer
Actual notice: subsequent buyer has actual knowledge of prior buyer’s interest
Constructive notice: instrument in the chain of title (something besides the deed --> ex mortgage)
Inquiry notice: facts that cause a reasonable person to do investigation

Prioritize subsequent purchaser interest if 2 things occur
(1) subsequent purchaser records first
(2) subsequent purchaser takes title without notice

Prospective buyer is on constructive notice of a potential interest by a current lessee if the current lessee is (visibly) in possession

Docs outside of the purchaser’s direct chain of title do not need to be searched
Not on notice outside of direct chain of title

3rd party promises to compensate a grantee if title is not accurate
Policy protects the grantees title
Ensures that it will defend the title (pay for title inspection, attorney fees etc.)
Exclusions from coverage:
Defects
Boundary disputes
Defects outside the public record (wild deed, wild encumbrance)
Broader than warranty deeds
Land clearing of titles through statute of limitations: unless doc is filed by owner within a period of time interest is treated as expired
Applies to: reversionary interests and springing executory interests
Marketable title act

eliminate interest that conflict with root tile
Root title: most recent conveyance of property older than a specified period of time
Usually the specified period is 30 years
Title clearing mechanism
Modern mechanism to make titles as clean as possible

Can only get damages which often wont make the buyer whole because they cant use the property how they wanted