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Property II - Coggle Diagram

- - - - What does the easement allow?
        
        Affirmative: owner grants action on their property
        
        Negative: owner must refrain from an act on their property
        
        Four traditional types of negative easements:
        
        blocking windows
        
        interfering with air flow
        
        removing support from a building
        
        interfering with a flow of water from an artificial water source
        
        Conservation Easements: created to preserve scenic and historic areas
        
        owners can give a public body or a charitable organization a conservation and receive a tax deduction
        
        perpetual in duration and transferable
      - What are the rights of the easement?
        
        Appurtenant: attached to the land where a servient estate gives benefits to a dominant estate
        
        Classic Example: right of way to access landlocked property
        
        passes automatically to subsequent owners of land if the parties intended and the burdened party has notice of the easement
        
        In Gross: attached to a person or company, not another parcel of land - either a personal or commercial right to use the servient estate
        
        Classic Example: utility poles or billboards
        
        are transferable if that was the intention of the easement
        
        If it is unclear which type of easement is intended, the law construes it in favor of an appurtenant
      - every easement must be one of each category to create a complete classification
    - - General Rule: cannot create or have an easement on one's own land
        
        can be in fee simple, for life, or for term of years
      - Easements are interest in land that are recorded with the Recorder of Deeds, which forms a part of public record of land
        
        Generally (with exceptions) has to be in writing with identities of grantee/ grantor, scope of easement, legal description of land, and signature of grantor, to satisfy Statute of Frauds
        
        Easements can be create in two ways:
        
        Created in By the Parties in an Express Agreement: granted direction from one party to another in a new writing
        
        Types in a Deed:
        
        Reservation: provision in a deed that creates a new easement that did not exist before
        
        General Rule: owners can create an easement to a third party when conveying land (Case: Willard v. First Church of Christ)
        
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        Exception: provision in a deed that excludes from the grant some pre-existing easement on the land
        
        Scope: controlled by the language of the grant
        
        easement holder’s use of an express easement generally is limited by the parties’ intent
        
        Created as an operation of law
        
        Four types of easements created as a operation of law:
        
        Implied Easement by Pre-Existing Use
        
        elements
        
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        Scope is only for the use that created the easement and closely related uses - cannot be expanded
        
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        Usual purpose is for utility lines, railroads, and sewer lines
        
        Easement By Necessity
        
        Purpose is to grant landlocked owners access to their property through another parcel of land
        
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        Prescriptive Easement: similar to adverse possession
        
        Party acquires a prescriptive easement through another's property through continuous uninterrupted use
        
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        scope can be expanded but must be a closely related use that the servient owner would have reasonably expected to lose by failing to interrupt the adverse use
        
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        Easement by Estoppel or Irrevocable license
        
        A license can become irrevocable through:
        
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        when ruling on easements, courts have the option to issue an injunction, damages, or nothing at all
    - - Possible ways for an easement to be terminated:
        
        Release: release must be in writing and satisfy the SOFs
        
        Estoppel: servient owner reasonably relies on a statement or action by easement owner
        
        Ex: "I don't need this anymore, you can build a pool here."
        
        Expiration: easement automatically ends in certain cases:
        
        by its terms: duration or defeasible easement
        
        be cessation of purpose: easement by necessity (when necessity ends) or estoppel (when damages have been recouped)
        
        by destruction: if servient estate is destroyed
        
        by prescription: servient owner can reacquire easement via adverse use
        
        Merger: if an easement owners also becomes owner of the servient estate, it ends -- a person cannot own an easement across their own land
        
        Condemnation: if government takes servient estate via eminent domain
        
        abandonment: easement holder shows a clear and unequivocal intent to abandon the easement
        
        mere non-use is not enough to show abandonment except for a prescriptive easement
        
        easement holder must take affirmative action to show an intent to relinquish the easement
    - - Courts generally identify and uphold parties intentions and expectations - but some rules apply:
        
        Common Law Rules:
        
        Location Rule: If a specific location is in the grant, it cannot be changed
        
        Types: Easements for access cannot be used for above or below ground utilities
        
        Dominant estate benefit: appurtenant easement cannot be used to benefit land that is not the dominant estate (Case: Brown v. Voss)
        
        Be mindful of scope rules by easement type
      - If there is a proposal to change, a number of factors are considered by courts:
        
        How was the easement created?
        
        What was the initial scope?
        
        Has there been any change to the scope?
        
        Is the change "reasonably foreseeable"?
      - Maintenance and Repairs:
        
        Parties can make agreements for maintenance and repairs
        
        If there is no agreement:
        
        Holder of the easement has the duty to make repairs
        
        Holder is liable to third parties for injuries caused by lack of maintenance
        
        If both use easement, court will apportion costs
    - - Assignability
        
        Appurtenant: benefits and burdens pass automatically to assignees of land if the parties intended and the burdened party has notice
        
        "runs with the land" even if it is not mentioned in a later deed
        
        In Gross: can be assignable for commercial purposes but not for personal uses, like hunting or fishing (Case: Miller v. Lutheran Camp)
        
        attempts to prevent the burden on the serviant tenement from increasing beyond the intention of the original parties
      - Divisibility
        
        In-Gross:
        
        If the use of the property is non-exclusive: generally. not divisible because too much burden on servient estate
        
        If the use of the land is exclusive: "one stock" approach - the easement can be divided but it still must be used as an entirety (Case: Miller v. Lutheran Camp)
        
        Appurtenant: dominant estate can usually subdivide within the range of "normal development"
        
        limits regarding the increased burdens on the servient estate
        
        Generally means dominant estate can be subdivided
  - - - if a license becomes irrevocable it becomes an easement under estoppel (Case: Mund v. English)
  - - - transferable
  - - - Two Traditional Approaches:
        
        Equitable Servitude which are enforceable in equity
        
        enforced at equity with the remedy of an injunction
        
        elements
        
        In writing and meets the SOFs unless it is a common plan
        
        created by implication of equity in a common plan/ scheme
        
        Intent to bind
        
        typical language is "successors, heirs, and assigns"
        
        Touch and concerns the land
        
        Notice - could be actual, inquiry, or record
        
        no privity is needed
        
        established in Tulk v. Moxhay
        
        Real Covenants which are enforceable at law
        
        enforced at law with the remedy of damages
        
        elements:
        
        Touch and concerns the land
        
        Affirmative promises (like neighborhood dues) can be enforced as "touching and concerning" the land (Case: Neponsit v. Emigrant Bank)
        
        Notice - could be actual, inquiry, or record
        
        needed for the burden to run, but not needed for the benefit to run
        
        Intent to bind successors
        
        typical language is "successors, heirs, and assigns"
        
        Horizontal privity: relationship between promisor/ promisee from a transfer of an interest in land
        
        needed for the burden to run, but not for the benefit to run
        
        Vertical privity: relationship between subsequent owners of the parcel
        
        for the benefit to run, there is a lower standard - can be transfered a smaller interest in land
        
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        for the burden to run there must be strict privity, meaning the entire estate must be transfered for the burden to run
        
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        Vertical Privity for a HOA:
        
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        In writing and meets SOFs
        
        Must be created by a written instrument signed by the covenantor
        
        cannot arise by estoppel, implication, or prescription like an easement can
        
        Covenents in Gross
        
        Traditionally "covenants in gross," where the benefits or burdens are not tied to a parcel of land, do not have burdens that run with the land because it is too hard to locate the benefited part
        
        Arkansas follows this
      - Modern Appraches:
        
        Common Development Scheme Doctrine and the Negative Equitable Servitude
        
        a common development scheme could be a CIC - but not all are
        
        Common Schemes: parcels of land that are clustered nearby one another, privately developed with uniform character, and have a common burden among them
        
        Common Scheme Doctrine is a judicial doctrine based on the circumstances of development of the land that creates a reciprocal Negative Equitable Servitude that binds and benefits every lot
        
        elements
        
        Intent to bind sucessors
        
        Touch and concerns the land
        
        Notice of "common scheme"
        
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        no privity necessary
        
        Doctrine was historically necessary
        
        Before this doctrine, if:
        
        a developer sold off lots one by one
        
        and there was no registered covenants or "declarations" for the whole scheme
        
        but each deed had a one way covenant where the new land owner was the promisor to developer
        
        then the earlier owners in the neighborhood had a difficult time suing later owners for violations because the benefit did not run (since the covenants were "one way"
        
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        A minority of states reject this doctrine based on a strict requirement of the Statute of Frauds
        
        Remedy is an injunction
        
        established in Sanborn v. McClean
        
        Courts look at factors to determine if and when a common scheme has started: ads, maps, representation of area, and prior sales
        
        Covenants in Common Interest Communities (CICs)
        
        CIC: a residential development where residents:
        
        own individual units
        
        units are subject to restrictions
        
        common areas are owned as tenants in common
        
        each member becomes a member of the ruling organization and is bound to the rules (CC&R)
        
        Covenants in CICs are generally enforceable
        
        Covenants in Declaration will be upheld unless it is "unreasonable" (Case: Nahrstedt v. Lakeside Village)
        
        Covenants adopted by the HOA or POA after the declarations:
        
        Majority Rule - Reasonableness standard: if it is reasonable, it can stay
        
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        Minority Rule - Business Judgement Standard: defer to the business decision of the board if it was in "good faith" and was in the best interest of the association/ its members
        
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        unless violation of FHA (Case: Curto v. A Country Place Condo Association)
        
        Types:
        
        Condos: one building where units have individual mortgages
        
        Cooperatives: one building where the cooperative holds the mortgage for the entire building and residents have stock in the cooperation and a long term lease on the unit
        
        found in NY
        
        CoOP board can deny entry to anyone for any reason outside of the FHA
        
        Planned Unit Development: detached houses with a common paths, pools, or parks
    - - Racially Discriminatory Covenants (Case: Shelly v. Kramer)
      - Sex. Religion Violations (Case: Cruto v. A Country Place Condo Association)
    - - Types of termination:
        
        Express Releaases
        
        Release: if a holder of benefit expressly releases, the covenant is extingushed
        
        the best option if avaliable
        
        Express waiver: all benefit holder expressly waive one non-conforming use, but the covenant remains for other nonconforming uses
        
        Ex: HOA decides to allow only duplexes, even though the rule says "single homes"
        
        Expiration by terms of grant
        
        Non-Enforcement and Equitable Defenses
        
        Change in conditions: conditions have changed so radically that the purpose of the covenant is defeated
        
        must show radical change inside the covenant area and outside the covenant area (Case: RiverHeights Association v. Batten)
        
        Laches: unreasonable delay by plaintiff to enforce servitude because it would be prejudice to the defendant
        
        bars enforcement but does not extinguish the servitude
        
        Unclean Hands: plaintiff has violated the covenant too
        
        Acquiescence: plaintiff has aquieseyced to violation for a long period of time
        
        specific to each plaintiff
        
        Estoppel: plaintiff has represented to the defendant that the covenant does not exist or will not be enforced
        
        Other Terminations
        
        Merger: unity of ownership of the benefit and burden
        
        Condemnation: land is taken by the government
        
        Against Public Policy: courts will not enforce a covenant that is against public policy
        
        Abandonment: substantial and general noncompliance with covenant
        
        court will consider the number of existing violations, severity, prior efforts to enforce, and whether the restriction still has benefits
- - - - Nuisance: a non-trespassory invasion of another's interest in the private use and enjoyment of land
        
        part property, part tort: essentially a tort to property because the land is being injured
        
        Purpose: "one must use one's own property so as not to injure that of another"
        
        Two Types of Nuisances:
        
        Private Nuisance: substantial non-trespassory invasion of the private use and enjoyment of land
        
        Interest protected: private land owners
        
        Difference between them is in the interest protected
        
        elements
        
        Intentional: acts for the purpose of causing the harm, or knows the harm is substantially likely
        
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        Non-trespassory: cannot be a physical entry onto land
        
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        Unreasonable
        
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        Substantial
        
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        With the use and enjoyment of the plaintiff's land
        
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        Exception: if the act is out of spite, with no reasonable use whatsoever, courts will rule it is a nuisance - no reason to work through the elements if that is the case
        
        Case: Morgan v. High Penn Oil
        
        Public Nuisance: substantial non-trespassory invasion of the enjoyment of land common to the public
        
        Interest protected: the public in general, not an individual land owner
        
        enforced by public agencies or individuals who have "special injury"
        
        elements
        
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        only protects ordinary uses of land, not abnormally sensitive land uses
        
        Remedies and Damages:
        
        Four potential remedy options for courts if there is a nuisance:
        
        Options that allow for the nuisance to continue:
        
        Damages: only for past harm
        
        Permanent Damages: damages for past and future harm
        
        Options that require the nuisance to end:
        
        Injunction: enjoin (stop) and abate (lessen the harm) or the activity (Case: Estancias Dallas v. Schultz)
        
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        Injunction with damages for the enjoined actor: there is an injunction, but the enjoined actor must be compensated for their loss because of the injunction (Case: Spurr v. Del Webb)
        
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        Coming to the Nuisance: moving to the vicinity of a nuisance that is already established (Case: Spurr v. Del Webb)
        
        Can be a factor in determining damages, or in some jurisdictions provides a defense from damages or an injunction
        
        Zoning laws are created to protect from use of land nuisance situations developing
        
        Zoning
        
        Zones definitely define how land can be used by creating areas with uniform regulations of area and use
        
        Motivations and Purposes:
        
        Purpose:
        
        promote public health, safety, morals, and general welfare
        
        stabilize and protect real estate
        
        promote and preserve quality of life
        
        Motivations:
        
        impact of industrialization
        
        reluctance to impose nuisance
        
        limits on restrictive covenants
        
        protection of property values
        
        Constitutional support for zoning:
        
        10th Amendment gives states powers that are not granted to the federal government
        
        state has police power to regulate public health and safety
        
        Process:
        
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        Modern Zoning Types:
        
        Single Use Zoning: each zone has an exclusive use
        
        Euclid Zoning: cumulative zoning that permits multiple uses
        
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        Complex Zoning Situations:
        
        Nonconforming Uses: land that is impermissible under current zoning restrictions, but is allowed because it existed pre-zoning
        
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        Flexibility in Zoning after creation:
        
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  - - - Liability is absolute
        
        Exception: if the defendant committed negligence that compromised their own land before the plaintiff excavated
      - No right to supports of structure on the land - only the land in its natural conditions
      - can be waived
- - - - Types
        
        Purchase money mortgages: money is borrowed to purchase property that is also the security for the loan
        
        Secondary mortgage: put up equity in a home for a loan
        
        Home equity line of credit (HELOC): an open end loan that allows borrowing up to a maximum credit amount
        
        Hone Equity Loan: all money taken out at one time
      - Priority of Mortgages
        
        purchase money mortgages
        
        others are determined by the date of the mortgage
        
        priority for future advance mortgages (mortgages that loans will arrive in the future) depends on if the advance is obligatory
      - Morgage Substitutes
        
        Deed of Trust: lender is the beneficiary of a trust - but treated the same as a mortgage
        
        still has equity of redemtion
        
        Land Installments: buyer gets deed only after contract is paid in full; buyer does not get equity and if they default they loose everything they have already contributed (Horne v. Harbour Portfolio)
        
        courts differ on how to handle these: some say it is equivalent to a mortgage, others say it depends on the facts, a third group says no equity of redemption at all
        
        Lease to own: purchaser pays a nonrefundable option fee up front and makes monthly payments under a lease for a fixed period, and at the end of a term, if the terms have all been met, the purchaser has an option to purchase the home and gain title
        
        price can be set at the beginning or end of the term - part of the monthly payments are applied to the price
        
        Arose after the housing crisis when mortgages became harder to receive
      - Problems in Providing Mortgages
        
        Redlining: denying extension of credit to specific geographic areas due tot he income, race, or ethnicity of residents
        
        Reverse Redlining: extending credit on unfair terms to marginalized communities (Horne v. Harbour Portfolio)
    - - When a mortgagor defaults, the mortgagee has options
        
        Do nothing and hope payments are caught up
        
        Declare default
        
        Lender has options:
        
        Activate acceleration clause - demand immediate payment of everything owed
        
        If dept cannot be paid, foreclosure is the legal process that allows creditors to take ownership and sell real property to pay off the mortgage
        
        Two types of foreclosures:
        
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        Alternatives to Foreclosure
        
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        Foreclosure Vocabulary:
        
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        Order of payment from a sale:
        
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        Impose extra charges (collection costs, late fees, attorney fees)
        
        Allow reinstatement - allow the owner to catch up what is owed
        
        mandated in Arkansas in some circumstances
        
        default: a term of the mortgage was not met - usually behind on payment
        
        most mortgages allow a 15 day grace period
    - - Title Theory: bank has title to the property when it is mortgaged
      - Lien Theory: homeowner has title and bank has lien until mortgage is paid
        
        Arkansas law
    - - If mortgagors Transfer:
        
        Modern law: triggers a "due on sale" clause where the full amount of the debt is owed when the home is sold or transferred
        
        Banks also have the option to agree to transfer mortgage
        
        Common law: could transfer and new owner took subject to the mortgage
      - If mortgagee transfers:
        
        Very common! Loaners go on the secondary market to flip loans -
        
        can be bundled together in mortgage back securities (MBS)
        
        notes and mortgages should be transferred together
  - - - Recording statutes requires that land records are maintained by the county recorder - created to assure good title
        
        Two types of indexes:
        
        by tract
        
        by grantee- grantor
        
        necessary for title searches for tracking land all the way back to the origin of the title
        
        Title Insurance: searches chain of title and agrees to compensate grantee for loss of title to a superior owner
        
        Alternative to Title Insurance system is the Torrens System, where the court makes final and conclusive adjudication of ownership
        
        not common - only used in a handful of states
        
        policies can limit liability to the title commitment (Case: Walker Rogge v. Chelsea Title & Guaranty Co.)
        
        Purpose is to protect purchasers in double dealings by creating clear priority
        
        At common law, the first grantee always prevails over the later grantee - called the first in time principle
        
        Modern approach has three types of notice statutes that aim to assure good title (below)
        
        Requirements to record vary by state but generally include:
        
        names of grantee/ grantor
        
        signature of grantor
        
        acknowledgement: notary public verifies identities
        
        property description
    - - Three types of notice statutes:
        
        Race stature: first owner to record wins, always - does not have to be a purchaser
        
        Notice: subsequent purchaser who lacks notice of the prior transfer prevails over a prior purchaser who did not record
        
        subsequent purchaser does not have to record either
        
        essentially gives priority to a bona fide purchaser - but must be a purchaser (does not apply to a gift or donation)
        
        Race-Notice: subsequent purchaser who lacks notice of the prior transfer prevails over a prior purchaser as long as the subsequent purchaser records before the prior purchaser
        
        Arkansas uses race-notice
        
        also only applies to a bona fide purchaser
      - Types of notice:
        
        Actual Notice: notice given to a party directly
        
        Constructive Notice: notice presumed by law to have been acquired by a person (whether he actually knew or not)
        
        Examples:
        
        Record Notice: notice based on an instrument that has been properly recorded
        
        Deed must be properly recorded to provide record notice
        
        Examples of problems:
        
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        Inquiry notice: notice attributed to a person when the information would lead an ordinarily prudent person to investigate the matter further
        
        Essentially any information that a reasonable person should have taken as something is wrong with valid rights (Case: Harper v. Paradise)
        
        Bona fide purchaser: someone who buys property without notice of another's claim
        
        paid value, lacked notice
- - - - private property
      - must be taken
        
        Types:
        
        Regulatory Taking/ Implied Taking: government regulation that severely reduces the usability and value of property
        
        Police Power to regulate established by the 10th and 14th Amendments, which give regulatory power to the states
        
        Timeline of approaches:
        
        1. Traditional Approach: must pay just compensation only when property is physically seized
        
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        has the right to control "noxious uses" but cannot be "arbitrary or unjust" discrimination
        
        Physical Taking: direct and permanent physical occupation of property
      - for public use
        
        types of public use:
        
        Private to public: government takes land for public use (ex: roads, parks)
        
        Private to use by public: government gives land to private entities for public services (ex: railroads, utilities)
        
        Private to private: "in certain circumstances, to meet certain exigencies that serve public purpose"
        
        very broad standard
        
        Case: Kelo v. New London: Supreme Court said an economic revitalization served a public use (Increased tax revenue and improved neighborhood)
        
        Dissents said that it sets a dangerous territory for "public use"
        
        states created "Kelo" laws that more specifically defined public use after this case
        
        Limits: must be carefully formulated economic development plan that "unquestionably" serves public purpose
      - for just compensation
        
        fair market value