BLAW 3314 Part1
Real Estate Law cards.
Terms in this set (91)
FEE SIMPLE Absolute
the interest that you own lasts forever; doesn't go away when you die (can stay in the family)
TYPES OF FEE SIMPLES
Defeasible or Condition Subsequent: some have restricted use: can only be used for school purposes, or church purposes. OR can work the other way around: no alcoholic uses
land interest where you get to enjoy the interest in the land or acquire the income from it for life; if guarantor doesn't say who it goes to, it goes BACK to the grantor
LIFE ESTATE: REVERSION
when grantor doesn't provide for where a remainder goes after the life estate, then it goes BACK to the grantor
WHAT MAKES UP THE FEE SIMPLE: "BUNDLE OF STICKS"
if you have the fee, you can convey away parts of it: you could sell the airspace above; you can give someone the right to take the water; sell mineral rights; lease the surface; etc.
RECTANGULAR SURVEY SYSTEM
Texas DOES NOT use this system; township, section; described by fractional shapes of each section
METES AND BOUNDS
going by the perimeter ... walk around the land and make certain markings
LOT AND BLOCK SYSTEM
based upon reference to subdivision; sometimes there's a reference to a map
LAND SURVEY SYSTEMS
metes and bounds, lot and block system, rectangular system
TWO SURVEY SYSTEMS TEXAS USES
lot and block, metes and bounds
STATUTE OF FRAUDS WITH REGARDS TO LAND
land must be accurately described! If not, then any contract for sale violates SOF. Any deed or mortgage that has bad description is invalid.
VALID DESCRIPTION OF LAND
means that, technically, the description will exclude land from any other tract of land in the world; ex. a street address is NOT an accurate description of land
TENANCY IN COMMON
owner owns interest, BUT there are no survivorship rights, if A,B or C dies their part goes to Estate, can own UNEQUAL interests, can acquire their interest at different times
owner owns interest, ALSO has survivorship rights, must have SAME interest, must acquire their interest at the SAME times
RISK OF LOSS: TEXAS RULE
risk of loss will pass to the buyer ONLY if formal title has passed (there has been a closing) OR the buyer has taken possession. Otherwise, risk of loss remains with seller
RISK OF LOSS: MAJORITY RULE
risk of loss passes to the buyer when the contract is signed (THE MAJORITY RULE)
SUFFICIENT DELIVERY: WIGGILL V. CHENEY
case with safe deposit box; it was ruled in this case that there was sufficient delivery by the grantor
DEEDS TO AGENTS
a deed delivered to A's agent ALSO means that the deed is delivered to A. Delivery has NOT occurred yet if O gives deed to his own agent and says "give this to A." Delivery will occur when O's agent gives the deed to A.
TRADITIONAL RULE REGARDING WHO BROKERS/AGENTS REPRESENT
agent for the seller represents the seller; agent who works with the buyer STILL represents the seller (traditional rule in Texas)
IS IT POSSIBLE FOR AGENT TO REPRESENT BOTH BUYERS/SELLERS?
yes, BUT this must be disclosed to all parties
WHAT MOST STATES SAY REGARDING AGREEMENTS WITH AGENTS
most states say that the agreement MUST be in writing. If not, then right to commission cannot be enforced. Also the rule in Texas.
4 TYPES OF LISTINGS
exclusive right to sell, exclusive agency, open/nonexclusive, and net
EXCLUSIVE RIGHT TO SELL LISTING
most favorable to the listing broker: means that he will get right to commission if the property is sold by ANYONE (even the owner) during term of listing agreement
EXCLUSIVE AGENT/AGENCY LISTING
broker is entitled to commission ONLY if he or other BROKERS sell the property. No right to commission if property is sold by actual efforts of owner.
seller agrees to pay a commission ONLY if broker is first to procure ('find') a buyer. If property is sold through the efforts of anyone else, then no commission.
seller agrees to accept a specified price for property and broker receives ANY amount paid over that price.
CAN AGENTS ENTER IN AGREEMENT WHERE THEY ALL EARN THE SAME?
no, agents cannot enter into this type of agreement; violates antitrust laws
AGENTS: AUTHORITY TO SELL YOUR PROPERTY?
yes, they can have that authority, BUT they are NOT given permission to sign or sell WITHOUT your permission!
BASIC DAMAGE RULE
the difference between contract price and market price at time of sale --> called COMPENSATORY DAMAGES
the difference between contract price and market price at time of sale (BASIC DAMAGE RULE)
an amount predetermined when the contract is formed for assessing a possible breach
advertising is NOT an offer, but an invitation for someone to make an offer for that price. You do NOT have to accept the offer they give you. You can change.
STATUTE OF FRAUDS
contracts in real estate have to be evidence by WRITING
the right of either party to sue to other to make them perform the contract
money that is paid down by the buyer to show their interest or "earnestnest." If buyer walks away, it is implied that they LOSE the earnest money they put down
"buyer doesn't have to buy unless he can get a loan;" "buyer doesn't have to buy unless he can, first, sell his house;" 'buyer doesn't have to buy unless the property passes inspection"
ENCUMBRANCE ON PROPERTY
something that would interfere with your enjoyment of the property: mortgage, easement, lien, judgement, etc.
when someone promises that there are no encumbrances (ex. easements, liens, judgements, etc)
If O conveys land to A, then A owns it because of intent, delivery and acceptance. A better record before O conveys it to someone else...
MARKETABILITY OF TITLE
property will easily pass in the market place. Property is NOT made unmarketable if there's something like a telephone line easement or utility easement because that should be expected.
LAW PRESUMPTION FOR DELIVERY OF DEEDS
if deed is in possession of grantee, then DELIVERY WAS MADE! If deed was recorded, there was delivery, intent, and acceptance
REGARDING WHAT A DEED NEEDS TO INDICATE
deed does NOT need to indicate what the buyer paid, but deed DOES need consideration clause ("what is the buyer giving"), but the consideration doesn't need to be explicit.
process where the money goes to seller and documents go to buyer
violating RESPA will result in a "kickback" if the agreement regarding referral is not in writing
REGARDING TITLE PROBLEMS
you would have notice of title problem if you looked at survey showing neighbor's property is encroaching on your property
if you are informed that your property is encroaching on someone's or someone's is encroaching on yours
can become part of real estate, but they start off as personal property first
possession that's continuous, hostile (not necessarily violent) adverse, peaceable, visible and acts like owner
THE ADVERSE POSSESSER
this person is ALWAYS the trespasser, on property without permission.
AGENTS FOR BUYERS
even when buyers have arrangements on commission, the seller's agent and buyer's agent SPLIT COMMISSION
TEST FOR NONEXCLUSIVE/OPEN LISTING
did the agent do SOME work? ONLY the agent who brings buyer in through effort will get the commission
WHEN HIRING RE AGENT AS SELLER
you're not allowed to pull property off market, lease it, keep agent's commission, etc. This is breach; agent can sue you for 6% of sales price
BROKERS ON COMMISSIONS
they cannot conspire set commissions
IF AGENT REPRESENTS BOTH PARTIES
agent must disclose this information
exception to SOF: no writing, but parties act like there's a sale, and seller starts improving the land. Evidence of this will be accepted in lieu of the writing
GENERAL RULE ON SOF
if you have a writing, both parties MUST sign contract of sale (in Texas) in order for it to be enforceable against either party
WRITINGS THAT SATISFY SOF
doesn't have to be typed: can be written on napkin, sticky note, paper bag. Only need names of parties, indication that one party wants to sell to the other, and description of the land
E-SIGN ACT (FEDERAL LAW)
anything you do electronically is good for SOF (RE trsx can be done entirely online)
BUYERS AND MARKETABLE TITLE
buyer can pull out if he doesn't feel he's getting marketable title
BOOK DEFINITION(S) OF MARKETABLE TITLE (104)
"a title which at all times and under all circumstances, may be forced upon an unwilling purchaser," or "a title that can be held quietly without fear of litigation to determine its validity"
EXAMPLE WHERE HELICOPTER CRASHES AND THEY SIGNED A CONTRACT
the estates would close the contract
WHAT THE SELLER HAS TO TELL BUYER
only has to tell buyer about things buyer couldn't find out normally; saying AS IS does NOT protect seller
DEEDS IN MOST STATES
must be acknowledged by a notary. Most states say deed CANNOT BE RECORDED UNTIL IT'S ACKNOWLEDGED
ABSTRACT OF TITLE
a summary of all transactions concerning all types of land; THIS IS JUST INFORMATION, doesn't give an opinion
HOW MUCH LAND CONVEYED IN MONTANA CASE
amount conveyed differed from description. Court emphasized the amount of acres that happened to be in the boundaries was what was conveyed (conveyance by tract)
CONVEYANCE BY TRACT/IN GROSS
emphasizing amount of acres within boundaries
CONVEYANCE BY ACRE/SQFT
emphasizing number of acres or number of sqft
PROPERTY INSURANCE RULE
only have to have insurable interest when the LOSS OCCURS, not when it was purchased
must have insurable interest in someone's life WHEN you take out the policy
WHAT IS A DEED
a document by which you convey interest in real estate
GENERAL WARRANTY DEED
the best type of deed; seller says "I warrant the property all the way back to prior owners, not just me"
SPECIALTY WARRANTY DEED
when property is only warranted back to me
PARTS OF A DEED
premises, habendum, warranty clause, execution clause, and acknowledgement
what the deed begins with - names of grantor/grantee, words of grant: facts/purposes, consideration, and legal description of parcels conveyed
starts with "To have and to hold ..." ; describes the interest taken by grantee, conditions on grant, and covenants of title
WARRANTY CLAUSE (DEED)
comprised of covenants
EXECUTION CLAUSE (DEED)
has grantor's signature, seal, and date of deed
notary attests to the execution
THE PART OF THE DEED FOCUSED IN BARRIER V. RANDOLPH
COURTS AND ADEQUACY OF CONSIDERATION OF DEED
courts aren't worried about paying too much or too little; they're not worried about the adequacy of consideration
difference between contract price and market price at time of the breach
VENDEE'S LIEN (BUYER)
buyer can enforce a lien against the property to get his property back
VENDOR'S LIEN (SELLER)
right of a seller to repossess the property sold until the buyer makes all payments for the full purchase price
DOCTRINE OF MERGER
even though seller is supposed to do certain things, if they DON'T do those things and buyer accepts, the seller is no longer obligated to do them anymore and those obligations are merged into the deed, BECOMING NEW CONTRACT (Reed v. Hassell ; but this case interprets in a way that favors the BUYER)
WHAT THE SELLER HAS TO TELL THE BUYER
ANYTHING that the buyer couldn't discover without reasonable inspection... including ghosts. Failure to disclose will give rise to action that benefits BUYER
when both parties agree to cancel contract and call off deal.
"AS IS" CLAUSE
does not release Seller from obligations to disclosing defects
term, to be paid what is due
COVENANTS & WARRANTIES
In Texas, these words are implied by using these words "grant" and "convey" in the Deed are the same.
The remnant of an estate that is conveyed to take effect and be enjoyed after the termination of a prior estate, such as when an owner conveys a life estate to one party and the remainder to another.
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OTHER SETS BY THIS CREATOR
BLAW 3314 Test 1
exam 2 terms
Ch 6 terms
THIS SET IS OFTEN IN FOLDERS WITH...
REA Exam 3
BLAW 3314 Exam 1
BLAW 3314 FINAL EXAM
BLAW Exam 1