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AGEC 4070 EXAM 2 ACTUAL SOLUTION!!
Property - Answers Bundle of rights Bundle may be - Answers Possession of the property Use of the property Ability to divide the property Ability to give the property Ability to lend the property Ability to sell the property Ability to destroy the property Ability to mortgage the property Real property - Answers Immovable property consisting of such things as land, things fixed to the land and othe things incidental to or appurtenant to land (buildings, fixtures, fences, trees, grass, minerals, timber, crops, etc) Personal property - Answers Property that is generally movable, but technically includes every kind of property that is not realty
Tangible personal property - Answers Things that can be seen and touched (tractors and equipment, animals, household goods, fixtures, crops, etc.) Intangible personal property - Answers That personal property that is a representation of ownership or possession interests (stocks, bonds, bills, notes, checks, bills of landing, warehouse receipts, promises to pay, obligations under a contract, court judgments, etc) Fixtures - Answers May be either real property or personal property. If "permanently" attached to real property, then what was formerly personal property will likely be considered as real property Factors considered when determining whether real property or personal property are - Answers Intent of the owner Manner of attachment to the real property Relationships of the item to the real property Whether the structural integrity of the real property would be harmed by removal of the items Crops that grow spontaneously on the land - Answers Trees, bushes, grass, etc Described as fructus naturales are considered to be part of the realty until severed Crops that are the result of annual planting and cultivation - Answers Corn, wheat, vegetables, etc
Fee simple absolute - Answers The largest estate recognized by law. Can be sold, divided, devised, or inherited and has an indefinite or potentially infinite duration. Laws in most states presume the existence of a fee estate unless there are words in the transaction of the contrary Fee simple estate that terminates upon the happening of a stated event and automatically reverts to the grantor - Answers It is created by durational language such as "for so long as," "while," "during," or "until." A fee simple determinable can be conveyed, but the grantee takes subject to the estate's being terminated by the specified event Possibility of reverter - Answers Land will automatically return to the grantor upon the happening of the specified event. This type of interest is transferable, descendible and devisable. This interest is referred to as a future interest of the grantor Fee simple subject to condition subsequent - Answers Created by the use of conditional words, such as "upon condition that", "provided that", "but if", and "if it happens that" Fee simple subject to an executor interest - Answers If an estate is either a fee simple determinable or a fee simple subject to a condition subsequence which terminates upon the happening of a given event and then passes to a third part rather than reverting to the grantor of giving the grantor a right to terminate, the third party has an executor interest. Life estates - Answers One measured by the life of one or more persons. A life tenant has the possessory right and use of the property, and
in nearly all respects is like a fee simple owner, such a person does not have the legal title to the property Life estate pur autre vie - Answers If the length of the life estate is measured by the length of life of someone other than the one holding the interest in the property Measuring life - Answers If there is no provision relating to who will hold the property upon the death of the "measuring life" the interest in the property will come back to the grantor through a reversion Remainderman If the life estate is subject to a condition subsequent, the grantor would hold a reversionary interest and the third party would hold an executory interest Waste - Answers Voluntary, permissive, or ameliorative Voluntary waste - Answers Exploitation of natural resources by a life tenant is generally limited to situations where: such is necessary for the repair or maintenance of the land; and is suitable only for such use; or it is Expressly or implied Love you permitted by the grantor Permissive waste - Answers Occurs when a life tenant fails to protect or preserve the land Ameliorative waste - Answers A change that benefits the property economically. My alter or demolish existing buildings if the market value of the future interests is not diminished
Tenancy by the Entirety - Answers Co-ownership of property like JTWROS but is only available for property between husband and wife and neither tenant can terminate the estate without consent of the other tenant JTWROS - Answers Joint Tenants With Rights Of Survivorship Tenancy by the Entirety - Answers Non recognized in alabama, but is recognized in 19 states and Washington, D.C. Community property - Answers Husband and wife should share equally in the property acquired through their joint efforts during marriage The principle of community property - Answers Foundation for the law in 8 states; Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas and Washington Trusts - Answers A fiduciary relationship between a trustee and beneficiaries whereby the trustee holds legal title to specific property under a duty to deal with the property for the benefit of the beneficiaries. Parties in a trust relationship - Answers Settlor or trust or Trustee Beneficiary(ies) Trustee - Answers Holds legal title to the property
Beneficiary (ies) - Answers Have equitable title to the property (may not have possession of the property, but usually have a claim to the benefits of the trust property) Inter vivos trust - Answers Trust established by a person during his lifetime Testamentary trust - Answers Trust established by a person in his will that will take effect upon his death Trust length - Answers May continue for any period of time set by the settlor (trustor), for a lifetime, until a child reaches a specified age, until a spouse remarries, etc. will be set out in the trust agreement or will Trust property - Answers Any kind can be placed in one, usually income producing Trust use - Answers A variety of purposes- generally to have some control of how property is used after the settlor' death Common methods of buying and selling real estate - Answers Private agreement Broker Auction Sealed bid
What needs to be in the contract for sale - Answers The purchase price and when and how t is to be paid. The date of possession A complete and accurate legal description A statement regarding any right reserved by the seller How taxes, assessments and insurance are to be apportioned How rental payment shall be divided if there is a tenant and any other factors relative to the tenancy How government payments which may be due shall be apportioned Agreement by the seller to furnish a cmmmitment for title insurance or an abstract and permit sufficient time for the purchaser to examine it and notify the seller of title defects which should be cured An agreement about any improvements which may cause doubt (temporary fencing, movable structure, etc) A statement regarding any easements which may exist in the property, particularly right-of-way easements or drainage easements A statement regarding escrow arrangement if escrow is involved Escrow - Answers A legal document (such as a deed), money, stock, or other property delivered by the grantor, promissory or obligor into the hands of a third person, to be held by the latter until the happening of a contingency or performance of a condition and then by him delivered to the grantee, promisee or obligee. Document transfer is delivered to a third person to hold until all conditions in a contract are fulfilled
Escrow account - Answers A bank account generally held in the name of the depositor and an escrow. Agent which is returnable to depositor of paid to third person on the fulfillment of escrow condition (funds for payment of real estate taxes are commonly paid into escrow accund of bank-mortgagors by mortgagee Escrow contract - Answers Agreement between buyer, seller and escrow holder setting forth rights and responsibilities of each Methods for selling Real Estate - Answers Cash sale Cash sale with mortgage Installment sales contract Installment sales contract - Answers Contract for deed, bond for deed) Buyer becomes beneficial owner of property and takes possessor after payment of agreed upon down payment. Seller retains legal title to the property as a security for performance Four parts of a deed - Answers Premises Habendum Executur Acknowledgement Premises - Answers The names of the grantee, the operative words of conveyance, a recital of consideration, and a legal description of the real estate
Quitclaim deed - Answers Warranties given above are not implied. If one sells property and gives this deed, then he conveys only the interest that he has in the property, whatever that may be. The grantor warrants that neither he nor anyone claiming under him has encumbered the property and that he will defend the title against defects arising under and through him, but as to no others Recording of deeds - Answers Deeds must be recorded (in Alabama probate office) to protect the purchaser, grantee, or release Guarantee of good title - Answers Abstract and attorney's option of title Abstract - Answers Chronological arrangement of the essential facts from documents or record affecting the title Merchantable title - Answers A person of reasonable prudence is willing to accept and one for which such a person would be willing to pay full value for the land Common defects that might be found in an abstract - Answers Failure of all necessary parties to sign a deed or other instrument conveying property Faulty description of the property Parties incorrectly named or designated An incorrect proof of heirship at the death of an owner Failure to establish heirship
No releases of record for mortgage, mechanic's lien, or other encumbrance of record Unsatisfied tax and judgment liens Minors and incompetents improperly represented in a legal proceeding involving the land Removal of defects - Answers Suit to quiet title Voiding of a prior transaction Restoration of title into the proper hands Have individuals with potential claim to grant a quitclaim deed to the property Title insurance policy - Answers Protects the purchaser against imperfections Regulation of land use - Answers Every owner of land has, by virtue of ownership, certain rights in the land of adjoining owners, in waters that come within the boundaries, and in the use of the premises Easements - Answers The right of one property owner to use the land of another for some specific purpose (right to cross the land of others, right to flood the land of an upper land owner, right to change the flow of surface waters, right to maintain a drain across the land of another, etc) Easement appurtenant - Answers When the easement right benefits the holder in the physical use and enjoyment of another tract of land
Express reservation - Answers Where individual A deeds property to another, but reserves an easement for his own use o the property that is being conveyed Prescription - Answers An easement is acquired through the exercise of use of the property of another for a sufficient period of time. For an easement to be granted by prescription, the use of the property must be: Open and notorious Discoverable upon inspection Adverse Continuous and uninterrupted For the statutory period Implication - Answers Created by an operation of law: an exception to the statute of Frauds. A conveyance of property has been made with no express reservation of an easement, but the underlying circumstances imply an intention to create an easement. For this type of easement to be granted, there must be: a. A separation of title of the dominant tenement and servient tenement b. The two pieces of adjacent property must have been owned initially by the same person c. Currently the two adjacent pieces of property are owned by different people Implied easement of absolute necessity - Answers When the owner of a tract of land sells part of the tract that has no outlet to a public road except over the remaining lands of the seller
Implied easement of reasonable necessity - Answers When there is some other access, but it would result in great hardship. For this to be recognized, prior, continuous, and obvious use of the right-of-way must have existed prior to the selling of the land Termination or end of an easement - Answers Express agreement by owners of dominant and servient estates Nonuse of the easement when such nonuse amounts to an abandonment of the use formerly made When the dominant and servient estates are merged or held by the same person When the purpose for the easement ends Whose responsible for easement uplkeep - Answers The person using it When is the owner of the servient tenement responsible for damaged - Answers If it was caused negligently or willfully Covenant - Answers An agreement or promise of two or more parties, by deed in writing, signed, and delivered, by which either of the parties pledges himself to the other that something is either done, or shall be done, or shall not be done Express covenants - Answers Created by the express words of the parties to the deed
Conduct indicating an intent not to enforce the covenant A change in the character of the geographic area or the conditions surrounding its use Police power - Answers The exercise of the government's sovereign right to promote the safety, health, morals, and general welfare of society within constitutional limits. Under police power - Answers The private use of land is regulated for the advancement of some acknowledged public interest Zoning - Answers One type of governmental activity authorized under the police power of the state Zoning - Answers A technique for regulating land use which is premised on the idea that in a given area certain uses of the land are expressly permitted and all other uses are prohibited In agriculture - Answers Zoning has been used to prevent the development of agricultural land Right to airspace - Answers Above a parcel of land is not exclusive, but the owner is entitled to the freedom from excessive noise Right to light - Answers Purchaser of the land has limited rights. Generally, courts do not recognize an implicit right to light over a grantor's remaining land after a transfer of a portion of his property
Right to lateral support - Answers The right to have land supported by the land that lies next to it. The adjoining land owner has the duty not to change his land so as to cause this support to be weakened or removed Right to subjacent support - Answers The right to have land supported by the land which lies under it. Adverse possession - Answers Method of acquisition of title to real property by possession of a statutory period under certain conditions Title can be acquired to real property by adverse possession - Answers Open and notorious Actual and exclusive Adverse and hostile Continuous Justification for adverse possession laws - Answers Encourage the use and improvement of land Aid in cleaning title to the land Time required to get title in Alabama - Answers In under COLOR OF TITLE, 10 years, without color of title, 20 years
