Property with Mertens Spring 2011
MIDTERM OUTLINE:
—————————————————-ESTATES IN LAND—————————————————-
1. How heirs (intestacy statute) or devisees (will) inherit
a. Fee Simple “To C and her heirs”
i. This does not grant the heirs anything. They will inherit through the estate, not by virtue of this grant
b. Per stirpes = method of dividing an estate where descendants share as a group to the portion of the estate to which the deceased would have been entitled
c. Can only sell/give future or present interest that you have
i. Presumption that owner conveys all interest has in property unless explicitly otherwise
ii. If A sells life estate to B, B has life estate for the life of A, aka life estate for the life of another
d. Don’t imply a condition of survivorship!
i. To C for life, then to D and his heirs = If D dies before C, then it goes to D’s estate when C dies and not directly to D’s heirs
ii. You don’t have to survive to get it b/c your estate can always get it!
e. If more than 2 in a problem, pretend like 1st person is dead to see what interest 3rd has, etc.
i. Ex. To C for life, then to D and her heirs, but if D dies with no children then to E = pretend that C has died to see that E has executory interest
2. Interpretation
a. Words of purchase/limitation
i. Purchase = designates who is getting the interest
1. Ex. “To C…then to D”
ii. Limitation = describes the estate
1. Ex. “and her heirs” means a fee simple absolute
b. Presumption against forfeitures
i. If possible to interpret language to avoid loss of property by current owner, then do it
ii. Precatory language like a statement of purpose is not enough to turn a fee simple absolute into a determinable (Wood)
1. Fee simple subject to condition subsequent over determinable b/c not automatically forfeited (Cathedral)
3. Rule Against Perpetuities
a. = No interest is good unless it must vest in interest (when contingency occurs that renders the interest certain to come into possession), if at all, no later than 21 years after the death of some life in being at the creation of the interest
b. Purpose = alienability of present owners to all maximum utilization of land
i. Want to avoid dead hand problem where owners seek to control who owns the property long after they die (concentration of wealth)
ii. Note: complete restraints on alienation (ex. To A but if A tries to sell then to O) aren’t ok
c. Application
i. ID interests subject to the rule
1. Applies only to nonvested interests:
a. Options (like executory interest since right to buy property in future)
b. Executory interest (unless present and future are charities)
c. Contingent remainder and
d. Vested remainder subject to open
2. All future interest in grantor are exempt because conceptualized as vested the moment they were created
ii. Seek a validating life
1. Must be alive at creation of the interest, aka when it becomes effectiv
ore prior estate is terminated, that interest is destroyed and reverts back to O
i. Only applies if there is a gap and an interest could be suspended
b. But usually not destructible
i. Ex. O to A for life, then to B if B has graduated from law school
1. If B has not graduated when A dies, goes back to O who has fee simple subject to executory limitation and B has executory interest which will vest when he graduates from law school
c. If in effect, then RAP is ok b/c we’ll know if it vests or not at the end of the prior estate
————————————————–SECURITY DEPOSITS————————————————–
1. What is a security deposit? (note: priority over other LL liens, & successors held liable)
a. A form of self help (use it to remedy defects without having to go to court)
i. But can’t use it to cover future defaults in rent
1. Duty to mitigate so this would be a penalty or double recovery
ii. What if LL doesn’t follow statute?
1. Then waived right to self help but not to file suit for any damages/cleaning UNLESS there’s bad faith
b. Don’t have to segregate this account or return the interest
2. All deposits are a security deposit!
a. Whether it’s for “security” or for “pets,” it’s all the same! (but application screening fee
