Internet Legal Resource Guide <http://www.ilrg.com/>
ILRG Law School Course Outlines Archive <http://outlines.ilrg.com/>
LawRunner:  A Legal Research Tool <http://www.lawrunner.com/>

Author:  	Mr. Neal A. Davis (ndavis@mail.utexas.edu)
School:		University of Texas School of Law
Course:		Property
Year:		Fall 1995 and Spring 1996
Professor:	Ernest E. Smith
Book:		Cases and Materials on Property, 6th Edition, by Cribbet, Johnson, Findley, Smith

Message from the Author:

Thank you for downloading this outline.  I hope it is as helpful to you as it was to me.  If you use this outline, please send $1 cash to help cover my time and effort in making this and future outlines available.  My address is:

Neal A. Davis
1071 Clayton Lane #1403
Austin, TX  78723

If you have any questions, feel free to e-mail me at:  ndavis@mail.utexas.edu

Your support will be greatly appreciated.  Good luck!

Sincerely,
Neal A. Davis

Property Outline

1995-96

Prof. Ernest Smith III

Books used in Smith’s class:  Cribett and Smith on Property

Recommended study aids:  The Gilbert’s on Property is good, and I highly recommend purchasing it.  The Emmanuel’s on Property is better than Gilbert’s in only one respect—it has a great section on land-use regulation. 

A few other comments:  This outline covers the first semester, and only portions of the second semester (for example, it does not cover “another’s land interests” or “land-use
regulation”).

Exam Tips from Smith Himself

1. Smith says that the topics on his exam are proportionate to the amount of time he spent on them in class (i.e., since we spent a great deal of time on classifying the different estates, expect numerous questions on the exam dealing with estates).

2. It is generally known that the more you write on Smith’s exams, the more credit you get.

3. Finally, Smith wants you to write about the policy issues just as much as you apply the black letter law to a certain problem.  This is really important not to forget.

Property and its Attributes

I. What is property?

	A. General views
 
       		1. According to Black's Law Dictionary, property is defined as:
		"That which is peculiar or proper to any person; that which
		belongs exclusively to one.  An aggregate of rights which are
		guaranteed and protected by the government.  Property extends
		to every species of valuable right and interest...the right to 
		posses it, use it, and to exclude every one else from interfering
		with it."

		2. The function of property law is to determine who among 	the competing 			claimants gets what when and under what conditions.

		3. In legal discourse, property is what the law defines as 					property--it denotes the legal relationship among people in
		regard to a thing. What claims should the courts and legislatures
		recognize as property? Two considerations are especially
		important in property law and run through most of it: fairness
		and economic efficiency. The lawgivers want to be fair, but at 
		the same time, they want the system to generate more wealth.

		4. All property can be divided into two types, real and personal:
			
			a. Generally speaking, real property is land and any	
			structures built on it.

			b. Personal property, which is everything else, consists
			of tangible items (things that can be seen or felt, such as
			a watch or book) and intangible items (property that
			cannot be seen, such as a bank account or a right not
			to be unfairly kicked out of law school).	

			NOTE:  Property is not limited just to what we can see or 					feel. Property can include a copyright, a promise, airspace, 					a right to fish, and so on. 

		5. Smith points out some general characteristics of property:

			a. Cash value

			b. Transferability

			c. Separable from person/personality

			d. Terminable upon death. 

			Mnemonic:  CaT ShiT

		EX: In Graham v. Graham, the ex-wife, following a divorce,
		asked that the court divide her husband's MBA with her, since
		she paid for most of it. The ct. ruled that the MBA is not
		"marital property" because: 1) it cannot be exchanged, assigned
		or sold and 2) because it is an "intellectual achievement"--the
		product of many years of education, combined with hard work,
		and thus was not acquired merely by the wife's money. 

		6. Smith also points out that property is an elastic word; its 					meaning varies with the context involved and the purposes in 				view.  As the different theories briefly outlined below illustrate,
		there is no unequivocal, absolutely correct definition of 					"property."

	B. Theoretical views of property
	
		1. Bentham

			a. Property is entirely a function of law -- that they live together 				and die together.  Thus, there cannot be property rights unless the 				law recognizes these rights.

b. The function of property is to protect people's benefits 		and expectations.. According to Bentham, property
is a legal construct designed to protect the expectations and enjoyment of the property owner.

		2. Posner and "Law and Economics"
		
			a. There are three characteristics property must exhibit:

				(1) Exclusivity - Other people can be excluded from,
				and making decisions regarding, what you own.
				You decide the most efficient way to handle your
				property.

				(2) Universality  - If a resource is limited, it should be
				owned. If it is universal, like sunlight or air, it 
				cannot be owned. 

				(3) Transferability - You can sell or give your land
				to someone else. 

				NOTE:  Posner believes that the absence of these give rise 					to inefficient property.

			b. If something has economic value, and people treat it
			as value, than that thing should be considered property.
			This view is different from Bentham's, since Posner
			believes that property does not only depend on a system
			of laws. A good example of Posner's theory of economic
			value of property is the black market, which is not subject 					to a system of laws. 

				NOTE:  Posner believes that regulations that do not follow 					the market are inefficient.

				NOTE:  Smith points out that Posner really cannot get 					away from Bentham, since ultimately property must be 					governed by laws.  

			c. The function of property is the efficiency of transfers.
			Posner would argue that the black market, such as drugs,
			should be legalized so that the property can be more
			efficiently transferred. 

			d. Smith on the advantage and disadvantage of Posner:

				(1) Advantage -- It tells you the economic consequences of 					your actions, and if you have a goal, it tells you the most 					efficient way to analyze it.

				(2) Disadvantage -- Economic efficiency overrides
				the importance of moral, ethical, and social issues, such as 					the legalization of drugs.

		3. Locke's "labor theory of property"

			a. Property arises when people mix their labor with a
			particular thing.

			EX: A picks berries. Since A's labor went into berries,
			he owns them.

		4. Hardin and "The Tragedy of the Commons"

			a. "Tragedy" refers to the inevitable working out of
			a particular situation, which ultimately leads to the
			destruction of the "commons." The "commons" refers
			to the common property that everyone has access to.
			
			b. Self-interest of the individual ultimately degrades 
			the interest of the commons. What the individual
			gains, through exploiting the resources and property,
			is less than the benefit received by the general public.

				(1) Example:  Y owns cows that graze on the commons. He 
				allows cows to rampantly reproduce and graze, so that
				he can earn more money off his cattle. The grazing						results in severe damage of the commons, and will
				ultimately lead to its destruction. Thus, while Y has
				personally benefited from the grazing and the cattle
				overpopulation of the commons, the general public
				suffers.

				(2) Holdout Problem:  It is always the best strategy to be 					the last one to agree to any collective situation designed to 					combat the tragedy of the commons -- your asking price to 					agree is increased (since everyone else has already joined).

				(3) Prisoner’s Dilemma:  No matter what anyone else does 					(whether they graze extra or graze less), it is always in each 				individual’s best interest to graze extra.
	    		
			c. Hardin proposes two alternative strategies to solve
			the problem of the commons:

				(1) Massive government regulation, like in
				the oil and gas industry.

				(2) A system of property rights. If resources are
				owned by specific people, then those people have						a vested interest in maintaining their respective
				resource.

II. Trespass to Property (or the Argument against Posner)

	A. Generally, trespass is an unlawful interference with one's person, property
	or rights. 

	B. Criminal trespass specifically  is the entering or remaining upon or in any
	land, structure, vehicle, aircraft or watercraft by one who knows
	he is not authorized or privileged to do so. The purpose of criminal 	
	trespass is to protect a person's right or land from unauthorized
	use or existence. 

	C. In the past, courts have occasionally argued that property rights
	are not created necessarily to serve economic efficiency, but to 
	serve human values. Notice how this contradicts Posner's argument.

	D. Human values, if they come into conflict with a person's right
	to use land and if they serve human rights, trump a property owner's
	"absolute" property rights.   State v. Shack.  This contradicts traditional view of  	property, as it was developed throughout the centuries and in case law such as 		Graham v. Graham and Moore v. Regents of UC.

	EX: In Shack, P, a migrant farm owner, argued that he had the right
	to keep other people off of his property, and charged D with trespass.  	
	D, a government legal-aid worker who wanted to assist the 	migrant workers, 	argued that a list of constitutional clauses allowed him to be on land.  Ct. ruled 	that constitutional issues were irrelevant, since the legal conflict here could be 	dealt with through state property law.  The New Jersey Court held that property 	should serve human values, not necessarily economic values or an "absolute" 	right, and therefore D 	was justified in entering P's property.  

III. Conversion

	A. Conversion is the unauthorized use, destruction or disposition of 
	another one’s personal property (chattels).  Conversion is a strict liability
	tort. 

	EX: B sells A a Picasso that A reasonably thinks belongs to B. However, it
	turns out that B stole the painting from C. A is liable to C for conversion,
	even though there was no intent to dispossess C of his personal property.

		 

The Importance of Possession in Establishing
Rights in Property

I. What is, and what Constitutes, Possession? 

	A. Parameters:  Possession is difficult to define. A person is in possession of 	object he physically controls (such as an apple held in his hand). But he
	may be in possession of objects not in his presence, such as the chair
	in his backyard when he left for work. A person may even be in
	possession of objects in his house, or under the soil of his house
	(i.e. minerals or oil), of which he is unaware. Thus, like property, 	
	possession is an elastic word; its meaning varies with the context 	
	involved and the purposes in view. 

	B. Different than ownership:  Possession is not the same as ownership. Ownership 	is "title," and is usually proved by showing documents signed by the previous
	owner of first possessor transferring title to the present titleholder.
	Possession is proved by showing physical control and the intent to 
	exclude others.

		NOTE:  Possession is easier to prove than ownership.

	EX:A buys a watch from a jeweler, who bought it from the manufacturer. B steals 	the watch from A. To recover the watch, A must prove ownership or prior 	possession of the watch. To prove ownership, one must produce the sales slip	 	from the jeweler or other proof of title, which A has probably lost. To prove prior 	possession, though, A has only to prove that the watch was in A's physical 	possession before theft.

	C. Constructive possession:  A person is in "constructive possession" when the 	law treats him as if he is in possession although, in fact, he is unaware of it. 	Constructive means "in the eyes of the law." A court can still find the find has 	better claim than the private property owner.

	EX: In South Staffordshire Water Co. v. Sharman, P allowed D to
	enter his property to clean the pool. D found some rings, and claimed
	he should own them. Ct. ruled that D was allowed on premises for
	the limited purpose of cleaning, under the direction of P, and that
	P is entitled to objects found, even if he is unaware they exist, since he 	
	is the owner of the property.

II. Acquiring Possession by Finding Articles

	A.  "First-in-time" rule

		1. The general rule of possession is that the first person to take a
		possession of a thing owns it. A corollary to this rule is that a 				prior possessor prevails over a subsequent possessor. Thus,
		a finder has rights superior to everyone but the true owner. 					Armory v. Delamarie. However, there are important exceptions 				to this rule. 

		EX: In Armory, A finds a jewel and takes it to a jeweler to have
		it appraised. The jeweler refuses to give the jewel back to A,
		saying that A does not own it. A is entitled to recover from 
		the jeweler either the jewel or the full money value of the jewel.
		As between A and the jeweler, the prior possessor has superior
		right.
		
		2. The "prior possessor wins" rule also applies to objects acquired
		through theft or trespass.  

		EX: If A steals a jewel and hands it to B, who refuses to return it, 				B is liable to A. B cannot question A's title or rightful prior 					possession if B is merely the subsequent possessor.  
		
		The rationale for this is that to rule in favor of B would most
		likely not deter crime, but it would likely immerse owners and 
		prior possessors in costly litigation with subsequent possessors
		to prove they are not thieves. 

		3. For the finder to become a prior possessor, the finder must:
		
			a. Intend to possess object; AND
		
			b. Take steps toward possessing object
		
		Thus, mere discovery is not enough for possession.

			Rationale -- The rationale for this is twofold:	

				(1) Economic efficiency:  We want to encourage people to 					possess and help society (though in practice this is not 					always the case, especially if one keeps something rare 					from society -- i.e., a painting), which would be stifled if 					we equated discovery with possession

				(2) Judicial efficiency:  We want to curb disputes of the “I 					saw it first” vs. “I saw it first” variety

				Mnemonic:  E.J. dionne	

			Example: Y discovers a shipwreck at the bottom of the Mississippi 			River. The ship sank some 27 years before and was abandoned
			by the owners. Y attaches a temporary buoy to the wreck,
			intending to return the next day, buy Y does not return. Nine
			months later, Z finds the wreck and salvages it. Z prevails over
			Y because Y has shown only an intent to possess object and has
			not shown sufficient acts of physical control. Y must place
			his boat over the wreck, with the means to raise it, to give
			notice to subsequent searchers of his prior possession. Eads v.
			Brazelton. 

		4. To establish abandonment of property, property must be:

			a. out of the true owner's possession for "an unreasonable
			amount of time;" AND 

			b. there must not be any intent by the true owner to reclaim the 				property.  Eads.

	B. Finder versus the owner of premises 

		1. Often the finder will claim an object; so will the owner of the 				premises where the object is found. (This assumes the owner
		of the premises does not own the object; if he did, he would
		actually prevail over the finder). The owner of the premises
		claims to be in either actual or, more usually, constructive
		possession.

			a. Objects found inside a private home are usually 
			awarded to the owner of the home.
			
			EX: A, a guest at  a party in B's home, finds a Rolex 
			watch under the sofa which no one claims to own. B
			is in constructive possession of the watch and can
			keep it until the true owner reclaims it.

			b. If the owner of a house has not moved into the 
			house (has not made it his "personal space"), it has
			been held that the owner is not in constructive 
			possession of the articles in the house of which he is
			unaware.

			EX: Y owns a large house requisitioned by the government
			to quarter soldiers. Y bought the house two years earlier
			and never moved in. A soldier finds in the house a 
			brooch hidden on a window ledge. The soldier prevails
			over Y because Y never moved into the house and took
			physical possession of it.  Hannah v. Peel.

			c. In dealing with objects found in a public place, the 
			courts have generally resolved the issue by resorting to
			the "lost-mislaid" distinction.  (Smith notes that this is almost 				always a factual issue.)

				(1) Lost property is property the owner accidentally 
				and casually lost (i.e. your wallet slips through a hole
				in your pocket). Lost property goes to the finder
				rather than the owner of the premises.
				
				(2) Mislaid property is property intentionally
				placed somewhere and then forgotten (i.e. a purse
				placed on a table and forgotten). Mislaid property
				goes to the owner of the premises.

			EX: A finds a wallet on the floor of a beauty shop and a 
			ring on the counter in the same shop. The wallet is	
			lost property because it is assumed it was not 
			intentionally placed on the floor. A, the finder, prevails
			over the shop owner, and can take the wallet home
			and keep it until the true owner shows up. Bridges
			v. Hawkesworth. The ring is mislaid property because,
			from its position, it is assumed it was intentionally
			placed on the counter and forgotten. The ring goes to the
			shop owner to keep until the true owner claims it.
			McAvoy v. Medina.

			NOTE:  Smith says that, generally speaking, the less
			dominion the owner has over his property, the less
			chance he has of ownership if lost property is found.
			For example, if A finds a piece of lost property, such as a 					wallet, in B's house, then B would most likely have
			possession.  But if A finds that wallet in a remote field,
			owned by B, that is located behind B's house, then A
			would probably have possession since B has less 
			dominion over the field than his house.

III. Adverse Possession of Property and Chattels

	A. Adverse Possession of Property 
		
		1. All states allow a person to acquire title to land by adverse
		possession. Although the exact requirements for acquiring land
		in this manner depend upon the specific statute of limitation
		involved, generally four things are necessary under statutes:
		
			a. There must be a cause of action. The possessor must be
			asserting an interest in the land inconsistent with the 					owner's claim (i.e., he cannot be a lessee).
		
			b. There must be possession. The claimant must be 					actually using the land or some part of it, and the use
			must be one which is suitable for the type of land 						involved.

			c. The possession must be open and hostile. The true
			owner must be able to know that someone else is in
			hostile possession.

			d. The possession must be continuous for a statutory
			period.  If the statue requires possession for 10 years, the
			10 years must be successive.  There can be no interruptions.  (The 				purpose of this is that we want the action to be brought when we 				can round up witnesses, memories are still fresh, etc.)

		2. Adverse possession is a means of acquiring title to property
		by long, uninterrupted possession that is open and notorious.
		The running of the statue of limitations on the owner's action
		in ejectment not only bars the owner's claim to possession, 
		it also strips the owner of title and creates a new title in the
		adverse possessor.

	B. Adverse Possession of Chattels

		1. A person can acquire title to chattels by adverse possession
		just as he can acquire title to land. Generally, the requirements 
		for adverse possession of chattels are the same as for land, 
		except the period of limitations is shorter. 

		2. There is one major difference between adversely possessing
		land and adversely possessing chattels: Adverse possession of 
		land is open and notorious whereas adverse possession to 
		chattels seldom is.

		3. When statue of limitations can begin running

			a. As soon as property is stolen (favors good faith purchaser)

			b. Doesn’t begin until good is found (favors owner)

			c. Possessor must make claim of adverse possession -- like for land 			(favors owner)

			d. The modern trend in dealing with adverse possession of
chattels is the "discovery rule," which favors the good faith purchaser.  Under the discovery rule, the conduct of the owner, not the possessor, is controlling. The cause of action for adverse possession accrues when the owner first knows, or reasonably should know through the exercise of reasonable diligence, of the cause of action, including the identity of the possessor. The owner, then, has the burden of showing due diligence if he wants to toll the statue of limitations.  O'Keeffe v. Snyder.

			[check with Smith on these]

			EX: A steals a valuable painting belonging to O. A hangs it 				in his home, and occasionally lends it to a local charitable 					show.  Under O'Keeffe, adverse possession runs from the 					time of the theft unless O can show that she used due 					diligence and failed to locate the painting; if O can show 					due diligence, adverse possession begins to run when O 					locates the painting. 

				NOTE:  Under the discovery rule, the key is whether the 					owner used due diligence in locating the missing chattel.

NOTE:  What is considered reasonable under the discovery rule, according to Smith, probably does not change along with the value of what is stolen. 

		4. In crafting a statutory rule, one must weigh:  

			a. stability in title (favors owner) vs.

			b. commerce (favors good faith purchaser)

IV. Conquest of Land

	A. The right to title by discovery usurps the right to title of previous
	possession when "civilized" and "uncivilized" groups contest who
	possesses the land.  Johnson v. McIntosh.  Thus, if a civilized country, like 	England, discovers "uncivilized" countries, like North America (which was 	populated by Indians), then England can claim land title based on discovery. 

		NOTE:  To have any title to land, one must show a grant from a 				sovereign.

		NOTE:  According to Smith, the easiest way to deal with competing land 			claims is through short adverse possession statutes.

	B. The inhabitants of a country do not possess land unless they mix their labor 	with land.  This is known as Locke's "labor theory of property."  Indians just 	lived off of the land and did not improve it, while the settlers mixed their labor 	with the land and greatly improved it.  Johnson.

	C. Critical Legal Studies Group:  According to this school, property only existed 	by the strong taking from the weak, and the legal system serves to perpetuate this.  

The Anglo-American System of Estates in Land

I. Introduction to Estates in Land
	
	A. Any interest in land which has received recognition either by the
	courts or by statute can be the subject of a real estate contract. Most 
	often, this interest is a fee simple, but there are other types of interests.
	Traditionally, the common law has recognized six estates--three 	
	of them were freehold estates, while the other three were non-
	freehold, or leasehold estates. In addition to these, there were
	non-possessory interests, such as easements, which were not 
	called estates. 

II. The Freehold Estates
	
	A. The fee simple, fee tail, and life estate are "freehold" estates. 
	Freehold was the highest form of holding under the feudal
	system.  An important difference between freehold and non-
	freehold (or leasehold) estates is that a freeholder in possession -- having a fee 	simple absolute, a fee-tail, or a life estate -- had "seisin," a concept which is 	almost 	impossible to define. 

		1. "Seisin" was an important concept in feudal times, and
		remains important in understanding how the estate
		system developed. A person is "seised" if he hold an estate
		of freehold and either has possession of the land or a tenant
		holds possession from him. Except where the land is leased
		and the landlord holds the seisin, "possession by a freeholder"
		embodies the fundamental idea of seisin.

		EX: O, fee simple owner of Blackacre, grants Blackacre to A for
		life. By this grant, O conveys seisin (possession) to A. A is now
		"seised." If O had conveyed Blackacre for ten years, O would
		retain seisin. A, a "termor" holding a term of years (a 					nonfreehold estate), could not be given seisin. Instead, A,
		a termor, was given possession. This illustrates the essential 
		difference between freehold and non-freehold (or leasehold)
		estates. A termor could not hold seisin because seisin was
		considered too important a thing to be entrusted to a termor,
		who was looked upon by the early judges as a rascally fellow.

		NOTE:  Although the concept of seisin long ago fell into disuse 				and was never recognized in Texas, it played an important part 
		of the evolution of the law of freehold estates. 

	B. The three freehold estates recognized by common law are:	
		
		1. A fee simple was the closest thing to complete ownership 				which the English law recognized. It is an estate that has the 				potential of enduring forever.
	
			a. Originally, the fee simple was created by use of the
			formula, "to A and his heirs." A's heirs received nothing
			by this conveyance; it was merely the formula which had 
			to be used to create a fee simple absolute (FSA). If the 					words "and his heirs" were missing, A only received a life
			estate. Cole v. Steinlauf

			b. Presumption of fee simple:  This “And his heirs” requirement is 				not in effect in the vast majority of states, however. Virtually every 			state now has a statute which provides that every grant, 					conveyance and devise of land "shall be deemed a fee simple" 				unless the wording of the transfer indicates that a lesser estate was 				created or unless the lesser estate is created by operation of law. 				Thus, if land is conveyed simply "to A," "to A in fee simple,"
			"to A in fee," or, in the old common law formula, "to
			A and his heirs," then A would receive a fee simple
			absolute. 
			 
			c. Inheritance in a fee simple absolute cannot be restricted 					under any conditions. 

			EX: If O conveys to Blackacre "to A and his heirs on his
			father's side," A receives an FSA which he can devise
			or convey; and if he dies intestate, all of his heirs, and
			not just those on his father's side, will inherit Blackacre.

		2. A fee tail was an estate that passed from the grantee to his 
		descendants. Unlike the fee simple, it could not be sold, devised, 				or given away; but instead descended in the grantee's lineal
		descendants (or "issue"). These estates are almost never created 				nowadays -- it only exists in about six states, including Maine, Rhode 			Island, and South Carolina.  (It is primogenitor.)

			a. A fee tail is created by O granting the property
			"to A and the heirs of his body." The term "heirs
			of the body" refers to the grantee's issue.

		3. The life estate entitles the grantee to live on the land for his 				lifetime or for the life of some other person.  

			a. A life estate is created by O conveying the property
			"to A for life." On the death of A, the land reverts to
			O, the grantor, assuming he is still alive.

			b. The life tenant is ordinarily free to transfer, lease, 
			encumber, or otherwise alienate her estate inter
			vivos. Of course, the transferee gets no more than the
			life tenant had--an estate that ends at the expiration of 
			the measuring life.

			c. The life tenant has certain duties to the remainderman
			which require that he use and maintain the estate, 
			without damage and waste, and deliver it to the 
			remainderman in the condition in which he found it.
			The life tenant is entitled to all the ordinary uses and 
			profits of the land.
	
			d. The life tenant must pay current taxes, interest on
			the mortgage, and current betterment assessments, 
			but he is not under an obligation to carry insurance on
			the land of structures. 

			e. Three different types of waste are recognized:
			
				(1) Affirmative (voluntary) waste - Occurs when
				the life tenant actively causes permanent injury
				by, for example, destroying building or ornamental
				trees on the land, or removing natural resources
				(minerals, timber, etc.). 
			
				(2) Permissive (involuntary) waste - Occurs when
				the life tenant allows the land to fall into disrepair,
				or the tenant fails to make reasonable measures to
				protect the land from the elements. Failing to pay
				taxes and allowing the property to be sold at tax
				sale is treated as permissive waste.
			
				(3) Ameliorating waste - Occurs when the principal
				use of the land is substantially changed--usually
				by tearing down a building--but the change 
				increases the value of the land. Ameliorating
				waste is actionable if the court finds that:
			
					(1) the grantor intended to pass the land with
					the specific buildings on it to the holder of 
					the remainder AND
			
					(2) the building can reasonably be used for 
					the purposes built.

					Rationale:  The rationale for this is that actions that 						increase the value of land today may not increase 						the value of the land at the time the life estate 						terminates.  (Smith rejects the idea of the grantor’s 						sentimental wishes as a rationale for ameliorating 						waste.)

					NOTE:  Feminists find this sexist because women 						must pay for maintenance and taxes, but cannot 						improve the land on which they live (this puts the 						remainderman in an ideal bargaining position).  						This argument is based on the premise that men are 						more likely to create life estates than woman -- 						women also live longer than men, on the whole.

			NOTE: A life estate can terminate either: 1) upon the 
			death of the life tenant  OR  2) if the life tenant decides
			not to accept the life estate, in which case the estate 
			reverts back to the grantor.

	C. The Defeasible Fees Simple 

		1. A fee simple can be created so that it is defeasible on the 
		happening of some event, and the owner of the fee simple then
		loses, or may lose, the property. If the fee simple is defeasible,
		it is of course not absolute. The three different kinds of 
		defeasible fees simple are:

			a. fee simple determinable

			b. fee simple subject to condition subsequent; AND

			c. fee simple subject to an executory limitation.

		2. A fee simple determinable (FSD) is a fee simple estate so 				limited that will automatically end and revert to the grantor 		
		when some specified event happens. 

			a. The usual language in creating an FSD is "so long as, "to 				A until," "to A while," or language providing that upon 					the happening of a stated event the land is to revert to the 					grantor. If a deed merely states the purpose for which
			the land is conveyed, such as "for school purposes," an
			FSD has not been created. 

			EX: O conveys Blackacre "to School Board for so long as the 
			premises are used for school purposes." The words "so					long as" are words of limitation, limiting the duration of 					the fee simple given. The school board has a fee simple 					determinable that will automatically end when Blackacre 					ceases to be used for school purposes. When that even 					happens, the fee simple automatically reverts to O, the 					grantor.  

			b. A fee simple determinable is a fee simple because it
			may endure forever. But, if the contingency occurs
			(Blackacre is used of other than school purposes, as 
			above), the estate automatically ends. The estate
			terminates immediately upon the occurrence of the
			event--nothing further is required--and the fee simple
			automatically reverts to the grantor. This is the 
			distinguishing characteristic of the FSD. 

			c. Words in an instrument that state the motive or 
			purpose of the grantor do not create an FSD. Rather, it
			is necessary to use words limiting the duration of the
			estate.

			EX: O conveys Blackacre "to Board of Education upon
			understanding that the land is conveyed solely for the
			purpose of being used for the erection and maintenance of
			a public school." The Board erects a school, but thirty
			years later the Board ceases to use Blackacre for a school.
			The Board has a fee simple absolute, not an FSD, and can
			do with Blackacre as it wishes. The words in quotation
			marks merely state the grantor's motive. The grantor has
			retained no rights in Blackacre. Roberts v. Rhodes 

			d. An FSD may be transferred or inherited in the same
			manner as any other fee simple, as long as the stated
			event has not happened. But the fee simple remains
			subject to the limitation no matter who holds it.

			e. Since there is a possibility that a grantee's determinable
			fee may come to an end upon the happening of the
			stated event, the grantor has a future interest called a 
			possibility of reverter. 

		3. A fee simple subject to condition subsequent  (FSSCS) is a 
		fee simple that may be terminated by the grantor when a
		stated condition happens. Unlike an FSD, an FSSCS does not
		terminate automatically upon the happening of the named 
		event--the grantor must either bring suit or make entry (what
		the case law refers to as taking "affirmative action") in order
		to regain the land.  

			a. An FSSCS is created by first giving the grantee an
			unconditional fee simple and then providing that 
			the fee simple may be divested by the grantor or
			his heirs if a specified condition happens. Traditional	
			language to create such an estate includes: "To A, but
			if X event happens....," or "to A, upon condition that if
			X event happens...," or "to A, provided, however, that
			if X event happens...," followed by a provision for re-
			entry upon the happening of the named event.  

			EX: O conveys Blackacre "to A, but if liquor is ever sold
			on the premises, the grantor has a right to reenter the
			premises." The words "but if...premises" are words of
			condition setting forth the condition upon which the
			grantor can exercise her right of entry. They are not
			words limiting the fee simple granted A. A has an FSSCS.
			O has a right of entry. If O does not choose to exercise
			his right of entry when liquor is sold, the fee simple 
			continues in A.
			
			b. An FSSCS may be transferred or inherited in the same
			manner as any other fee simple until the transferor is
			entitled and does exercise the right of entry. 

		4. A fee simple subject to an executory limitation (FSSEL) is a fee 
		simple that, upon the happening of a stated event, is 						automatically divested in favor of a third person.

		EX: O conveys Blackacre "to School Board, but if within the next 				20 years Blackacre is not used for school purposes, then to A." 				Observe that the forfeiture interest is in another grantee, A, and 				not in the grantor, O. A's future interest is called an executory 				interest.

	D. The Defeasible Life Estates

		a. Just as there are defeasible fees simple, there are also defeasible
		life estates. Thus, a life estate can be created so as to be 
		determinable, subject to condition subsequent, or subject to
		an executory limitation.

		EX: If O devises Blackacre "to my wife for life unless she 					remarries," the life estate will terminate upon either the
		wife's death or her remarriage. This is an example of a life
		estate determinable.

		EX: O, who owns Blackacre in fee simple absolute, conveys
		the land “to Rosa, the widow of my son John, for so long as
		she remains unmarried.” This conveyance should be construed
		as a defeasible life estate. The language suggests a restraint
		on marriage, and the traditional argument for enforcing the
		language is that the grantor really intends to provide support
		to Rosa, rather than to create a financial disincentive to 
		marriage. Since Rosa will need support only during her lifetime,
		there is some logic in treating the deed as conveying a life estate.
		The principal argument against the life estate construction is
		the presumption that a fee simple is created, unless express
		language indicates an intent to create a lesser estate.
  
			NOTE:  These types of ambiguous conveyances are common
			on Smith’s exams.

III. Interpreting Wills and Estates

	A. Sometimes it is not clear what estate is created by the language used.
	Courts must then construe the instrument to determine whether the
	estate conveyed is a fee simple, life estate, or leasehold estate. Each case
	depends on its own facts and the probable intent of the grantor. The 
	following are common examples of ambiguous language raising 
	construction problems:

		1. "To my wife, W, so long as she remains unmarried." Does this
		create a fee simple determinable or a life estate determinable
		(on theory that the condition--marriage--could only happened 
		during W's life)? Majority view: A fee simple determinable is 
		created, even though the fee simple cannot be forfeited after W's
		death. 

		2. "To my wife, W, to be used as she shall see fit, for her
		maintenance and support." Does this give W a fee simple or a 
		life estate with power to consume the principal? Majority view:
		A fee simple is created; words "for her maintenance and 
		support" merely state the reason for the gift. 

	B. There are two reasons for the majority view in the above two
	examples: 

		1. First, where the language of a deed is so ambiguous as to be 				susceptible to different constructions, that interpretation will 				be adopted which is most favorable to the grantee.  (This is because the 			law does not favor forfeiture.)

		2. Second, that a conveyance will be construed to avoid a 
		forfeiture wherever possible. Thus, a fee simple on a condition
		subsequent is preferred over a fee simple determinable, and a
		fee simple absolute is preferred over both.  Oldfield v. Stucco
		Homes, Inc.
	 
	C. In the case of future estates, one can usually distinguish between
	a condition precedent from a condition subsequent. Occasionally, 
	though, the distinction is a judgment call, like an umpire calling
	borderline balls and strikes.

IV. Future Interests

	A. A future interest is an estate which may become possessory in the
	future. A future interest is a present interest in the sense that it is
	a presently existing interest. But it is not a presently possessory interest,
	and that is why it is called a future interest. Just as possessory estates
	are limited in number (fee simple, fee tail, life estate, leaseholds), so
	are future interests. There are five categories of future interests:
	reversion, possibility of reverter, right of entry, executory interest,
	and remainders. Remainders can further be divided into vested and
	contingent remainders. 

	EX: O conveys Blackacre "to A for life, and on A's death to B." A has
	a possessory life estate. B has a future interest called a remainder. It 
	will become possessory on A's death. Before A's death, the remainder
	exists as a property interest in Blackacre. As with other property
	interests, B can transfer the remainder to C,  and B's creditors can
	reach the remainder. It is an existing property interest, which will
	become possessory in the future.

	B. Future interests are divided into two basic groups: future interests
	retained by the grantor and future interests created in a grantee. If
	the future interest is retained by the grantor (or, if retained by a will,
	by the testator's heirs), the future interest must be either a reversion,
	possibility of reverter, or right of entry.

		NOTE:  Future interests in the grantor are always vested (grantor keeps 			back some of his conveyance).

		1. A reversion is whatever is left when less than a fee simple is
		conveyed away. Thus, whenever the last vested estate is less 
		than a fee simple, there is a reversion in the grantor. It may be
		certain to come into possession, as for example, if O conveys
		"to A for life"; or it may possibly never come into possession, 
		as for example, if O conveys "to A for life, then to B if B marries 				C."

		NOTE:  Traditional property view has been that if O owns 
		merely a life estate in Blackacre when he conveys it "to
		Marie for Marie’s life," O has retained a reversion. 
		Also note that since defeasible fees simple are of potentially 		
		infinite duration, they are not lesser estates than the fee simple
		absolute. Hence, the transferor of an FSD has not retained a
		reversion.

		2. A possibility of  reverter is the future interest retained by a 
		grantor when he conveys a fee simple determinable (FSD).

		EX: If O conveys "to the First Baptist Church for so long as the
		premises shall be used for church purposes," O has a possibility
		of reverter. He will automatically own the premises if the land is 				no longer used for church purposes. 

		3. A right of entry for condition broken (or power of					termination) is the interest following a fee simple upon a 
		condition subsequent (FSSCS). The grantor must take 					affirmative action to regain the land upon the occurrence of 		
		some event.
		
		EX: O, who owns Blackacre in fee simple absolute, conveys "to the First 			Baptist Church upon condition that church services be conducted thereon 			weekly, and if such services cease to be held, O or his heirs may re-enter 			the premises."
		
		NOTE:  There is a crucial difference between a possibility of reverter 			(FSD) and a right of entry (an FSCS). The FSD automatically 
		terminates upon failure to comply with the condition and the
		land automatically reverts to the grant. But in an FSCS, the
		grantor must take affirmative action, such as asserting his
		right of entry, before he can regain the land upon the occurrence
		of some event.

		4. From the explanations above of the three different future
		interests retained by the grantor, it is easy to see that 
		possessory estates have correlative future interests in the
		grantor:

			a. A life estate--reversion
		
			b. Fee simple determinable--possibility of reverter
		
			c. Fee simple on condition subsequent--right of entry.

	C. The two future interests created in a grantee must either be an executory 	interest or a remainder.

		1. Generally speaking, an executory interest is a future interest
		in a grantee that, in order to become possessory, must divest
		or cut short the prior estate, OR spring out of the grantor at
		a future date. The basic difference between a remainder and
		an executory interest is that a remainder never divests (or cuts short) the
		prior estate, whereas an executory interest almost always does.

		Executory interests were authorized by the Statute of Uses in
		1536, the purpose of which was to abolish uses, turning them
		into legal estates that would be subject to all the usual feudal
		incidents upon death of the legal owner. With the passage of the
		Statute, springing and shifting interests became possible at
		law, and they became known as executory interests.

		EX: Springing executory interest. O grants Blackacre "to A for life,
		and one year after A's death, to C and his heirs." A springing 
		interest is created in C. Since C's interest is created in futuro and
		there is a gap of one year in seisin, it would have been void
		in old English common law, but under the Statute of Uses, it
		is valid. On A's death, the estate reverts to the grantor O for
		one year, then springs out to C.

		EX: Shifting executory interest. O grants Blackacre "to A and 				his heirs, but if A dies without having had children, then to C 				and his heirs." A retains the fee simple while an executory shifting interest 		is created in C. In old English common law, this interest would have been 			void as a fee on a fee, but under the Statue of Uses, the interest shifts to C. 

			NOTE:  Watch for violations of Rule Against Perpetuities in these 				sorts of conveyances.
		 
		2. A remainder is a future interest created in a grantee that is
		capable of becoming a present possessory estate upon the 
		expiration of a prior possessory estate created in the same 
		conveyance in which the remainder is created. It is called a
		"remainder" because upon the expiration of the preceding
		estate the land "remains away" instead of reverting to the
		grantor. Unlike an executory interest, a remainder never divests 				or cuts short the preceding estate but always waits patiently until 				the preceding estate expires.  Remainders are classified either as 				vested or contingent.

		EX: O conveys Blackacre "to A for life, then to B if B is then
		living." B has a remainder because B's interest is capable of
		becoming possessory upon the termination of the life estate.

		NOTE: Smith points out an important difference between vested
		and contingent remainders in regard to alienating land. A vested
		remainder can sell his property, and a value can be put on that
		property. With a contingent remainder, the title is clouded, and 
		the value of the property is much less certain than that of a 
		vested remainder. Investors obviously prefer to buy vested 					interests.

			a. A vested remainder is a remainder that is both created 					in an ascertained person and is not subject to any 					condition precedent. 

			EX: O conveys "to A for life, then to B in fee simple." B
			(an ascertained person) has a remainder not subject to
			a condition precedent. The word "then" following a life
			estate is a word of art meaning "on the expiration of the
			life estate." Whenever or however the life estate
			terminates, B (or her representative) will be entitled to
			possession. B's remainder is vested. 

			There are three types of vested remainders:

				(1) An indefeasibly (or absolutely) vested remainder 					is when the holder of the remainder is certain to 						acquire a possessory estate at some time in the 						future, and is also certain to be entitled to retain 						permanently thereafter the possessory estate so 						acquired.

				EX: If O devises Blackacre "to A for life, then to
				B and her heirs." B (or her representative) is 
				certain to take possession on A's death. If B dies
				before A, B's heirs or devisees are entitled to 
				possession when A finally dies. Thus, B's remainder is 					indefeasibly vested. (If B dies intestate and without heir 					during A's life, B's remainder escheats to the state. At A's 
				death, the state takes the property. The reason that
				the state, instead of O, takes the property upon the
				death of A and B in this parenthetical example is
				that the state will wait for an heir of B to materialize, no 					matter how distant that heir is, and then give that heir the 					property).

				(2) A vested remainder subject to open is when a
				remainder is subject to open, it is vested in a class
				of persons, at least one of whom is qualified to take 
				possession, but the shares of the class members
				are not yet fixed because more persons can
				subsequently become members of the class.
		
				EX: O conveys "to A for life, then to A's children."
				If A has no children, the remainder is contingent,
				because no person qualifies (or can be ascertained)
				as a child. If A has a child, B, the remainder is 
				vested in B subject to "open up" and let in other
				children. B's remainder is sometimes called "vested
				subject to partial divestment." (Once the remainder
				has vested in B, the interests of the unborn children
				are called executory interests because they may 
				partially divest B.)

				NOTE: In a vested remainder subject to open, the
				class closes when the life estate terminates. Thus, in
				the above example, the class would close upon A's
				death and only those children already born could
				receive their interest. 

				Smith explains, however, that a trust can keep a class
				gift from closing upon the death of a life tenant. 
				“In trust, to the benefit of A for life, then to the benefit
				of any child of B” is a way to keep the class open to
				B’s children after A dies.

				NOTE: A vested remainder subject to open is the
				only vested remainder that might be subject to
				RAP. One must look at the class gift to see if it
				violates RAP.

				(3) A vested remainder subject to total divestment 
				is when a remainder is either subject to being
				totally divested by the operation of a condition 						subsequent or vested subject to divestment by an 						inherent limitation of the estate in remainder.

				EX: condition subsequent. O conveys "to A for life,
				then to B, but if B does not survive A, to C." The
				vested remainder in B is subject to total divestment
				upon the occurrence of a condition subsequent (B
				dying, leaving A surviving). C's executory interest
				will divest B if the condition subsequent happens.

				EX: inherent limitation. O conveys "to A for life, 
				then to B for life, then to C and his heirs." B has a 
				vested remainder for life subject to total divestment
				if B fails to survive A. The divestment occurs 
				because of the inherent limitation in a remainder
				for life: It fails if it does not become possessory 
				within the life tenant's life. C has an indefeasibly 
				(or absolutely) vested remainder in fee simple.

			b. A contingent remainder is if it is either limited to an
			unascertained person or subject to a condition precedent.
			The difference between a vested and contingent 
			remainder is not whether the remainder is certain to
			become possessory, but whether the remainder is limited
			to an unascertained person or is subject to a condition
			precedent.

			EX: unascertained person. O devises Blackacre "to my
			daughter Mary for life, then to the children of Mary" at
			a time when Mary is childless. Since Mary is childless,
			the remainder is contingent because the takers (the 
			children) are not ascertained at the time of the 
			conveyance. If a child is born, the remainder vests in that
			child subject to open and lets in other children born later.
	
			NOTE: A remainder in an "unascertained" person means
			the person is not yet born or cannot be determined until
			the happening of an event. Such a remainder is, of course,
			contingent.

			EX: subject to condition precedent. O devises "to my
			widow for life, and then to my daughter Cecilia and her
			heirs if she survives my widow." In this case, a condition
			precedent must be met--Cecilia must survive the widow--
			before she can be entitled to the property. 

			NOTE: A condition precedent is an express condition set
			forth in the instrument (other than the termination of
			the preceding estate), which must occur before the 
			remainder becomes possessory. 

			EX: alternative contingent remainders. O devises "to J
			for life, then to J's children. If J has no children, then to 
			cousin Vinny. If Vinny does not survive J, then to 
			Vinny's children." Vinny and his children are alternative
			contingent remainders, since they stand to attain the
			estate should J have no children. 

			NOTE: Smith says alternative contingent remainders
			are very common.
	
	NOTE: Smith points out an important difference between vested
	and contingent remainders in regard to alienating land.  A vested
	remainder can sell his property, and a value can be put on that
	property.  With a contingent remainder, the title is clouded, and 
	the value of the property is much less certain than that of a 
	vested remainder.  Investors obviously prefer to buy vested interests.

	D. Sometimes it is difficult to distinguish between a vested remainder
	subject to total divestment (i.e. subject to a condition subsequent) and
	a remainder subject to a  condition precedent.  Whether a condition is 
	precedent or subsequent depends upon the words of the instrument.
	The words must be read in sequence and the interests classified in
	sequence. Whether a remainder is vested or contingent depends on the
	language employed. If the conditional element is incorporated into the
	description of, or into the gift to the person taking the remainder, then
	the remainder is contingent; but if, after words giving a vested interest, 
	a clause is added divesting it, the remainder is vested. As explained 
	above under FSSCS in defeasible estates, there are certain words--"But if," 	"Provided that," "On condition that"--that establish a condition subsequent 	(a vested remainder subject to total divestment). Just the word “if” always
	refers to a condition precedent (a contingent remainder).

	Thus, where “A devises to B for life, then, if C (a bachelor) marries before
	B dies, to C and his heirs on B’s death,” C’s remainder is contingent (because
	“if” is used). But if A devises “to B for life, then C (a bachelor) and his heirs
	but if C does not marry before B dies then to D and his heirs,” C has
	a remainder subject to total divestment (because “but if” is used).
	Note how in this example the difference between the two types of interests
	is principally one of form, since C will not take in either case unless he marries
	during B’s lifetime, yet the distinctions is usually adhered to by the courts.

	EX: condition precedent (or contingent remainder). O conveys "to A
	for life, then to B and his heirs if B survives A." It is reasonably clear
	that the contingency--the survival of B--is a condition precedent to B
	receiving an interest in Blackacre. Thus, this is a contingent remainder.

	EX: condition subsequent (or vested remainder subject to total 
	divestment). If O conveys "to A for life, then to B and his heirs, but if
	B ever smokes pot, O has a right to reclaim the land." It is reasonably
	clear that the condition--not smoking pot--is intended to operate as a
	condition subsequent. Thus, this is a vested remainder subject to
	total divestment.
		
	NOTE: If the language is so ambiguous that the interest cannot be
	determined, the law favors a vested interest over a contingent one.  The reason 		for this, as mentioned below, is alienability.	

	NOTE: Smith says that the most common condition is one of survivorship--
	“A for life, then to B upon A’s death”--which almost always is a condition
	precedent. The next most common condition precedent is reaching an age:
	“To A for life, then to B’s first child that reaches 21.”

	E. There are four rules restricting remainders, briefly discussed below and
	then at much greater length afterwards:

		a. Destructibility of Contingent Remainders: This rule applies only to
		legal contingent remainders in land. It does not apply to equitable
		interests, to interests in trust,nor to personal property. It is a rule of
		law, not a rule designed to carry out the grantor’s intent. 

		b. Destructability by Merger: This rule applies only to
		legal contingent remainders in land. It does not apply to equitable
		interests, to interests in trust,nor to personal property. It is a rule of
		law, not a rule designed to carry out the grantor’s intent. The 
		discussion of this rule is incorporated under Destructibility of Contingent
		Remainders.

		c. Shelley’s Rule: This rule applies to legal and equitable remainders
		in land. It does not apply to personal property. It is a rule of law, not
		a rule designed to carry out the grantor’s intent.

		d. Doctrine of Worthier Title: This Doctrine applies to legal and
		equitable remainders and executory interests in real or personal
		property. It is a rule of construction designed to carry out the
		grantor’s intent, and can be overcome by contrary evidence of intent.	

	F. Destructibility of Contingent Remainders: A contingent remainder in 		land is destroyed if it does not vest prior to or at the time of the 			termination of the preceding possessory estate.  If the preceding freehold 	terminates before the 	remainder vests, the remainder is struck down and can 		never take effect.  The destructibility rule only applies to contingent 	remainders, not vested remainders, executory interests, personal (as opposed to 	real) property, or interests in trust (i.e. equitable estates).

	EX: O conveys Blackacre "to A for life, remainder to A's children who
	reach age 21." At A's death, his children are all under age 21. The 
	remainder is destroyed. Blackacre reverts to the reversioner, O, who 	
	owns it in fee simple absolute.

	Smith explains that the way to get around this problem is to create a trust.
	“In trust to A for life, then in trust to any child of A who reaches 21.” A
	trust allows one to circumvent the desctructability rule. 

		1. A "preceding freehold" refers fee tail or life estates, both of
		which have seisin. Since fee tails are largely obsolete, we will
		only discuss life estates below. The destructibility rule does not 				apply if the preceding estate is a leasehold, because the termor 				does not have seisin.
		
		2. The life estate or fee tail can terminate either upon the death
		of the life tenant or before the life tenant's death. It is this latter
		proposition that makes the rule more difficult than it appears.

			a. A contingent remainder that does not vest upon the
			natural termination of the life estate (i.e. at the life 						tenant's death) is destroyed.

			EX: O conveys "to A for life, remainder to the heirs of B."
			B is alive. This conveyance creates a life estate in A, 
			contingent remainder in the heirs of B, reversion in
			O. Subsequently A dies, survived by B. At A's death, B
			has no heirs, because no one can be an heir of the living.
			The contingent remainder in the heirs of B is destroyed,
			and O owns the land. 

			b. A contingent remainder that does not vest upon the
			artificial termination of the life estate is destroyed. 					This "artificial termination" can be due to forfeiture or
			due to the Doctrine of Destructibility by Merger:

				(1) Under the Doctrine of Destructibility by
				Merger, a life estate in A and a remainder in
				A will merge unless: 
				
					(a) There is an intervening estate (must be vested); 						OR

					(b) The remainder in A is subject to a
					condition precedent to which his life estate
					is not subject.

				The lesser estate (life estate) is merged into the larger (fee					simple) and ceases to exist as a separate estate. Thus, a life
				tenant and reversioner can conspire to destroy
				contingent remainders. This is called the Doctrine
				of Destructibility by Merger or simply the Doctrine
				of Destructibility -- this allows you to clear up messy land 					titles.

				EX: O conveys "to A for life, remainder to B if B 
				survives A." While B is alive, A conveys her life
				estate to O. The life estate merges into the 
				reversion, and B's contingent remainder is
				destroyed. O has a fee simple absolute. 

				EX: O, who owns Blackacre in FSA, conveys 
				Blackacre “to B for life, then to C for life, remainder
				to V and his heirs.” V conveys his interest to B.
				B’s present and future estates do not merge. The
				Doctrine of Merger only applies where one has a 
				present possessory estate and a vested future interest
				in succession. Here, a vested future interest in someone
				else -- a life estate in C -- intervenes.

				NOTE: This Doctrine of Destructibility by Merger
				has been overturned in the large majority of
				states by statute or by judicial decision (as it
				was by the New Mexico Supreme Court in
				Abo Petroleum Corp. v. Amstutz)

	G. There are two other peculiar rules that apply to remainders: the Rule in 	Shelley's Case and the Doctrine of Worthier Title

		1. The Rule in Shelley's Case, one of the great traps of common
		law conveyencing, goes as follows: 
			
			(a) one instrument 

			(b) creates a freehold in land in A,

			(c) purports to create a remainder in A's heirs (or the heirs of A's 				body), AND

			(d) the estates are both legal or both equitable, then the remainder 
			becomes a remainder in fee simple (or fee tail) in A.

		EX: remainder to A's heirs. O conveys "to A for life, then to
		A's heirs."  The Rule in Shelley's Case converts the remainder
		limited to A's heirs into a remainder in fee simple in A. 
		Then Doctrine of Destructibility by Merger steps in, and A's life
		estate and vested remainder merge, giving A a fee simple in
		possession.

			NOTE:  Modern law treats interest in A’s heirs here like a fee 				simple absolute.

		EX: remainder to heirs of A's body. O conveys "to A for life, then
		to the heirs of A's body." The Rule in Shelley's Case converts
		the remainder limited to "the heirs of A's body" into a 
		remainder in fee tail in A. The fee tail is then changed into
		whatever estate is substituted for a fee tail under state law, 
		probably a fee simple. Then the remainder in A merges with A's 
		life estate. 

		EX: O to "A for life, then to B for life, then to the heirs of B." The
		rule here operates to change the contingent remainder in fee
		simple in B's heirs to a vested remainder in B. Because B would
		then have both the life estate and the remainder in fee, the 
		Doctrine of Destructibility by Merger causes coalescence so that
		B would have a present estate in fee simple. 
		
		O to "A for life, then to B for life, then to the heirs of A." Under
		Shelley's Rule, A becomes the remainder in fee simple; 					however, there is no merger because of intervening vested 					remainder in B.
		
		O to "A for life then one day after A's death to the heirs of A." 
		The Rule doesn't apply here because A's heir's interest is not
		a remainder but a springing executory interest (since a day passes before 
		he can obtain the property). 
		
		O to "A for life, then to A's issue." The Rule does not apply here
		because the Rule requires the use of technical words of 					inheritance, "heirs" or "heirs of the body." 

		NOTE: The doctrine of merger is an entirely
		separate doctrine from the Rule in Shelley's Case. The doctrine
		of merger is that a life estate in A and a remainder in A will
		merge unless (i) there is an intervening estate or (ii) the 
		remainder in A is subject to a condition precedent to which his
		life estate is not subject. The doctrine of merger may or may not
		apply after the Rule in Shelley's Case has applied.

		In order to better understand the Rule in Shelley's Case, it is
		necessary to briefly explain each of its four elements:

			a. "If one instrument creates a freehold estate in A": 
			All American cases applying the Rule have involved
			a life estate. The life estate can be measured by A's life
			or it can be a life estate por autre vie (measured by another 					person's life).

			b. "And purports to create a remainder": The Rule applies 
			to a remainder to the heirs of A, the life tenant, even 
			though there is an intervening estate between the life
			estate and remainder. For example, the Rule applies to a 
			conveyance "to A for life, then to B for life, then to A's 
			heirs." A has a remainder in fee simple by the operation
			of the Rule. A's remainder does not, however, merge 
			with his life estate: B's intervening remainder for life
			prevents merger (this is covered in one of the examples
			immediately above).

			c. "In A's heirs (or the heirs of A's body)": The remainder
			must be given to A's heirs or heirs of the body. 

			d. "And the estates are both legal or both equitable": The
			life estate and remainder must be either both legal or
			both equitable. If one is legal and the other is equitable,
			Shelley's Rule does not apply.

			EX: O conveys Blackacre "to X in trust for the life of A to 
			pay A the income and profits, remainder to the heirs of
			A." X has a legal life estate pur autre vie. A has an
			equitable life estate and A's heirs have a legal remainder
			in fee simple. Since A's life estate is equitable and the 
			remainder to A's heirs is legal, Shelley's Rule does not
			apply. 

		2. The Doctrine of Worthier Title (applies to grantor’s heirs as opposed 			to grantee’s heirs, like in Shelley’s Rule) holds that a grantor cannot
		create a remainder in his own heirs if the heirs would have taken
		the same estate by descent. 

		EX: If O conveys Blackacre "to A for life, remainder to O's heirs," O has
		a reversion following A's life estate, and O's heirs have nothing.

			NOTE:  If O gives the rest of his property to the Texas Law School 			Foundation, then TLSF gets Blackacre. 

		The Doctrine changes the remainder in the grantor's heirs to a 				reversion in the grantor. The original reason for the Doctrine
		of Worthier Title is probably the same as for Shelley's Rule.
		Feudal instances were paid upon descent of land. In the above
		example, feudal dues would have to be paid upon O's death if
		he had a reversion passing to his heirs, but not if his heirs 
		took by way of a remainder created during O's life (such as A).
		Hence the Doctrine prevented O from depriving his lord of
		feudal dues by an inter vivos conveyance of this kind.
		
		NOTE: Smith thinks that the Doctrine of Worthier Title is intent-				defeating, and that it leaves property very taxable (this is why it’s such a 			bad idea, he says).
	
	H. Rule Against Perpetuities (RAP)

		1. The classic formulation of the Rule Against Perpetuities (RAP): 				No interest is good unless it must vest, if it ever vests, not later than 21 		years after some life in being at the creation of the interest.  Smith and 			others simply refer to the formula of the Rule as "Lives in being + 21 			years." 

		2. RAP applies to contingent remainders and executory interests. 			It does not apply to vested remainders nor to future interests in 				the grantor (reversion, possibility of reverter, and right of entry), 				which are treated as vested upon creation. The exception to this
		is the class gift (see below). As with the Doctrine of Destructibility by 			Merger,  Shelley's Rule, and the Doctrine of Worthier Title, one of the 			purposes of the Rule Against Perpetuities is to curtail contingent 				remainders. 
	
		EX: O conveys "to A for  life, then to A's children for their lives,
		then to B and his heirs." A has no children. The conveyance is
		entirely valid, and not subject to RAP. The remainder for life
		given to A's children will vest, if at all, at A's death. The
		remainder in fee simple in B is a vested remainder when
		created (the language "and his heirs" creates an FSA).

			a. The class gift is the one major exception to applying the
			learning about vested and contingent remainders under
			RAP. A gift to a class is not vested in any member of the
			class until the interests of all members are vested. Or to
			put it differently, A class gift is not vested under RAP 
			until the class has closed and all conditions precedent 
			have been satisfied for every member of the class. If the
			gift to one member of the class might vest too remotely,
			the whole class gift is void. This is known as the "all-
			or-nothing rule."

			EX: In 1991, O conveys "to A for life, then to A's children
			for life, then to A's grandchildren in fee simple." A is
			the measuring life. The gift to A's children will vest, if at 					all, at A's death. The only problem is with the remainder 					to A's grandchildren. If A has a grandchild (B) alive at the 					time of the conveyance, the remainder is vested in B 					subject to open, but it is not vested under RAP. The 					remainder is a class gift and will not vest until all takers 					are identified. They will not necessarily be identified until 					the death of all A's children, and all A's children are not 					necessarily in being. RAP would void the class gift in this 					case.
			
		3. RAP is directed at the creation of contingent interests 
		that might vest in the distant future (the distant future being
		defined as more than 21 years after the expiration of the 
		relevant lives in being at the creation of the interest). If there is
		any possibility that a contingent interest will vest too remotely,
		the contingent interest is void from the outset. The thing to
		look for is the possibility of remote vesting. Courts do not wait
		to see what happens, but look at the interest at the time of
		creation and determine then if the interest will necessarily
		vest or fail within the perpetuities period set by the Rule. If 
		it will not necessarily vest or fail within the period--if there is
		any possibility that it may vest beyond the period--it is void.
		As Smith points out, "the difficulty comes, of course, in 
		attempting to apply the Rule to specific fact situations." Below
		are a list of situations involving RAP:
 
		EX: Suppose that T bequeaths property "to A and his heirs; but if
		liquor should ever be consumed on the premises, then over to
		B and his heirs." Here, there is the attempted creation of a fee
		simple subject to a condition, with a shifting executory interest
		(i.e. it would operate to cut short A's fee simple estate) in B.
		The gift over to B violates RAP. It is possible that liquor
		might be consumed on the premises several hundred years from
		now, a time well beyond the period of perpetuities. The
		requirement of "vesting," as to executory interests, is when
		liquor is consumed on the premises. This vesting event might 
		take place beyond the period of the rule. Since the attempted
		creation of an interest in B is invalid, it is stricken from the will.
		A has an FSA.

		EX: Suppose the limitation above read, "then over to B" instead
		of "to B and his heirs"? Same result. For words of inheritance 
		are not necessary to the grant of a fee simple estate. 
		
		EX: Suppose that two years after the will takes effect, liquor is
		consumed on the premises. B is still alive at this time. Does the 
		fact that the divesting event occurred in B's lifetime save the
		limitation over to B? No. We look at the situation at the time
		the interests are created, here at the death of T, to see if RAP 
		applies. At the time of T's death, what might happen? It is
		possible the divesting event may take place decades from now.
		What actually happens after T's death does not matter if, at the
		time of T's death, there is any possibility that a contingent 
		interest will vest too remotely.

		EX: A different result would follow, though, if the divesting
		contingency were the consumption of liquor during B's lifetime.
		Now the shifting executory interest in B in fee simple is valid,
		since the divesting event that will give possession to B must
		take place, if it’s going to take place, in B's lifetime. B is our life
		in being.

		EX: Let's look at a totally different scenario. T bequeths property
		"to A for life, then to such of A's children as shall attain the age
		of 21." A has a life estate, and there is a contingent remainder in
		A's children that reach 21. This does not violate the rule, because
		all of A's children will be born (or will be in gestation) at A's 
		death. This means that the gift to any one of A's children will
		vest--if at all--within A's lifetime plus 21 years. A is the life in
		being that saves the gift. 

		NOTE: As has already been explained, when there are vested 				remainders subject to open, the class closes at the termination of the 			life estate. Thus, in the above example, the class would close 				upon A's death and only those children already born could
		receive their interest once they turned 21.

		4. The statement of RAP provides that the contingent remainder
		must vest, if it ever vests, within some life in being at the time 				of the creation of the interest plus 21 years thereafter. It is not 
		necessary, however, that one specific person alive at the time of 
		the creation be singled out as the measuring life, as long as it
		can be demonstrated that the interest must vest within the life
		of one person, that is, the survivor, among a definable group of
		persons reasonable in number, plus 21 years thereafter. 
		The group of persons is frequently called the "measuring lives."
		A measuring life has to have been alive--"in being"--at the time 				the interest was created. This rule has some general guidelines:

			a. Usually, the people of the generation just before the
			interest was created are the measuring lives. 
	
			b. Usually, these people are named in the instrument						(i.e. a will or trust).

			c. Often times, these people are entitled to the benefits
			of interest just before the interest was created.

			d. Finally, 90% of the time, the measuring lives are
			the parents (or parent) of the contingent remainders.

		EX: A bequeaths "$100,000 to his grandchildren as are alive
		21 years following the death of the last survivor of A's sons,
		X, Y, and Z." X, Y, and Z are alive at A's death. The future
		interests of the grandchildren are contingent because of the
		condition of survivorship to the time of distribution. One
		"measuring life" cannot be singled out from X, Y, and Z, but
		RAP does not require this; it is clear that it is one of those 
		three sons, X, Y, and Z, that is the last to die who will
		constitute that "life," and this is sufficient to satisfy the rule. 
		Those three sons are the measuring lives. Of course, the
		estate may not vest at all if there are no grandchildren at 
		the deaths of X, Y and Z.

		5. If for-profit corporations, instead of humans, are used in a
		conveyance, then the gross period of 21 years is commonly used 				to determine if the future interest violates RAP. Because a 					corporation is a "legal entity," as opposed to a human being, it 				has a potentially infinite duration and cannot technically be a 				"measuring life." Thus, the law simply applies the gross period 				of 21 years to corporations. Often times, corporations violate 				RAP.

		EX: O devises Blackacre "to Chevron so long as it is used for
		mining purposes, and if Blackacre is no longer used for
		mining purposes, then to Exxon." It is very possible that 					Exxon's interest will vest more than 21 years after it was created. 				We don't know for sure how long Chevron will use the land. It 				may be 2 years; it may be 200 years. Hence, Exxon's executory
		interest violates RAP.

		EX: Smith likes to use the example: "O devises Blackacre to the 				First Baptist Church for so long as Blackacre is used for church
		purposes, and if the land is no longer used for church purposes,
		to the Exxon corporation." The same rule in the above example
		applies here. It is very possible that Exxon's interest will vest
		more than 21 years after it is created, since we have no idea 
		how long the church will use Blackacre. Thus, Exxon's
		executory interest violates RAP. 

		NOTE: This example of Smith's can be a bit confusing since
		it involves a non-profit corporation and a for-profit 
		corporation. As explained below, RAP does not apply only if
		two non-profit corporations (or charities) are involved--
		there is a gift to Charity A followed by a divesting gift to
		Charity B if a specified event happens.  

		6. An exception to RAP is non-profit corporations--the gift from
		one charity to another. If there is a gift to Charity A followed 
		by a divesting gift to Charity B if a specified event happens, the
		executory interest in Charity B is exempt from RAP. The reason
		for this exception is that charities are favorites of the law. Like
		a corporation, a charity can last potentially forever. There is
		no objection to shifting enjoyment from charity to charity
		through time.

		EX: O conveys "to the First Baptist Church (FBC) so long as 				the property is used for school purposes, and if the property
		is no longer used for school purposes, to the Red Cross." Since
		there is a gift to FBC followed by a divesting gift to the Red 
		Cross upon the occurrence of a specified event, the executory
		interest in Red Cross is exempt from RAP.

		NOTE: This exception applies only if both the possessory estate
		and future interest are in non-profit corporations or charitable 				organizations. Smith says that government entities, such as
		Austin School District (ASD) would fall under charitable
		organizations/non-profits and be exempt from RAP.

		7. Remember that an interest is void under RAP if by any
		possibility--however remote--the interest might vest
		beyond the perpetuities period. If a situation can be imagined
		in which the interest might not vest or fail within the
		relevant lives in being plus 21 years, the interest is void.
		The following two cases of the fertile octogenarian and
		the unborn widow illustrate the harsh and sometimes 
		surprising consequences of a vivid judicial imagination.
		These two cases are classic pitfalls that lawyers and law students 				alike fall into when dealing with RAP. 
	
			a. The fertile octogenarian: The law conclusively
			presumes that a person can have children so long
			as the person is alive. Evidence that a person is 80
			years of age or has had a hysterectomy or vasectomy
			is irrelevant. After all, a person of any age can adopt
			a child. This principle is frequently overlooked by
			lawyers who naturally assume that 80-year-old 
			persons will not have any more children, and proceed
			to draw instruments in violation of RAP.

			b. The unborn widow: The law assumes that a person's					surviving spouse might turn out to be a person not now
			alive. For example, a man's present wife may die or be
			divorced, and the man may in the future marry a woman
			not now alive. This assumption leads to the unborn 
			widow case.

			EX: O devises property "to A for life, then to A's widow 
			for life, then to A's children as are then living." A is the
			life in being. The gift of the remainder is contingent upon 					A's children surviving the two life tenants: A and A's 					"widow." Here is what might happen. A's present wife 					might die. Then A might remarry a woman who was not 					living at the time O died. (Hence this second wife might 					not be a life in being.) then A might have a child by this 					afterborn widow. Then A and everyone now on the scene 					(except of course the second wife and the afterborn child) 					might die. Then the widow might live for more than 21 					years, and then die, survived by that afterborn child. The 					gift would not vest, as to this hypothetical child, within 					lives in being plus 21 years. Since all  of this might 						happen, the gift of the remainder is invalid.
	 
			A constructional out, however, is possible. You could 					argue that although O said A's "widow," he really meant 					A's present wife, if she survived A. If a judge finds this
			argument persuasive, then the gift is valid.
				
			NOTE: The "unborn widow" scenario is not as far-fetched
			nowadays as it seemed when it was first thought up in
			the 1950s. Smith points out that today it is very common
			for older men to marry much younger women (or
			"Lolitas" as he calls them).

		8. Under the common law RAP, any possibility of remote 
		vesting voids the interest. The what-might-happen test has
		come under fire in the last half-century for defeating
		reasonable dispositions upon the assumption of possible
		events that, in fact, rarely occur. Most states, according to Emanuel’s, 			have reformed RAP by adopting the wait-and-see doctrine. Under
		the wait-and-see doctrine, the validity of the interests is judged
		by actual events as they happen, and not by possible events
		that might happen. The validity of the interest is not determined
		at the time the interest is created. It is necessary to wait and see
		what happens. The states that have adopted the wait-and-see
		doctrine wait out the common law perpetuities period--lives
		in being + 21 years--before declaring the contingent interest
		void. 

		EX: O conveys Blackacre "to A for life, remainder to A's 
		children who reach 25." The remainder is void under the what-
		might-happen test. However, under the wait-and-see approach,
		we wait and see what happens during the perpetuities period
		(the lives of A and all A's children alive at the time of the 
		conveyance plus 21 years). If all A's children reach 25 within
		this period, the gift is good. If they do not, the gift is bad as to
		all of A's children--even those who have reached age 25--under
		the class gifts rule. It may then be reformed under a cy pres 
		power to reduce the age contingency to the age 						necessary to save the gift (see the explanation of Cy Pres 
		Doctrine below).

			a. The wait-and-see doctrine has been criticized on primarily two 				grounds:

				(1) Not knowing whether an interest is valid or void may 					prove inconvenient; and

				(2) The doctrine results in the extension of the dead hand 					and of more wealth being tied up in trust (which RAP is 					supposed to prevent).

		9. The second reform of RAP, adopted in a handful of states,
		is the cy pres doctrine. Under this doctrine, an invalid
		interest is reformed, within the limits of the Rule, to
		approximate most closely the intention of the creator of the
		interest. Exercising the reformation power, a court can reduce
		age contingencies to 21 years or make some other appropriate
		change to reform the invalid interest.
		
		EX: O conveys "to A for life, remainder to A's children who
		reach age 25." The remainder to A's children is void under
		RAP since it is a class gift that might vest too remotely. 					Exercising the cy pres doctrine, a court may reduce the age 					contingency to 21 years, thus saving the gift.

	I. Trusts: A trust is a fiduciary relationship with respect to property in which one 	person, the trustee, holds the legal title of property subject to equitable rights in 	beneficiaries. Thus, as Smith says, there is a split in a trust between legal
	and equity rights. A trust is basically a device whereby one person manages 	property for the benefit of others. The person who creates a trust is called the 		settlor (or trustor). 

		1. Reasons for trusts: There are a number of reasons to set up a trust:

			a. For tax reasons (i.e. receive tax breaks)

			b. Paternalistic attitude of property owner, who wants to
			control who gets what, and when.

			c. It allows for special instructions -- how the trust will
			be distributed.

			d. If it is a charitable trust, it is exempt from RAP

			e. Finally, it avoids the common law doctrine
			of RAP (i.e. it can prevent RAP from voiding class gifts).
			
		2. Establishing a trust can prevent RAP from voiding a
		class gift.
		
			NOTE:  To some degree, RAP applies to trusts. At some point
			in the next three or four generations of family, the trust
			has to terminate and legal title will be given back to the family.
			This is how RAP prevents wealthy families, like the Kennedys
			or Vanderbilts, from retaining trusts that last forever and tying
			up wealth.

		3. A trust can prevent a class from closing in a vested remainder
		subject to open: Smith explains that a trust can keep a class gift from 			closing upon the death of a life tenant. “In trust, to the benefit of A for life, 		then to the benefit of any child of B” is a way to keep the class open to B’s 		children after A dies. If B’s children have not reached 21, then the trustee
		holds onto the property until they turn 21, at which time it goes to them.

		4. A trust can circumvent the destructibility rule: A trust can prevent
		a the destructability rule from taking effect. “In trust to A for life, then in 			trust to any child of A who reaches 21.”

	J. An appropriate--and easy--way to classify remainders is as follows.
	Take each interest in sequence as it appears. Determine whether it is
	given to an ascertained person or is subject to a condition precedent.
	Classify it. Move on to the next interest and do the same thing. 
	Classification of each interest in sequence is the key to correct 
	classification.

	EX: O conveys "to A for life, then to B and his heirs if B survives A, 
	and if B does not survive A, to B's children and their heirs."  Take each
	interest in sequence. First, "to A for life." This gives A a life estate.
	Second, "then to B and his heirs if B survives A." Stop at the comma,
	which ends B's interest, and classify it: B has a remainder because it
	is capable of becoming possessory upon the termination of the life 
	estate, and will not cut the life estate short. It is a remainder in fee 
	simple ("B and his heirs"). It is a contingent remainder because it is
	subject to the express condition precedent, "if B survives A." Third,
	move on to the next interest, "and if B does not survive A, to B's 
	children and their heirs." Classify it: The interest is a remainder
	because it is capable of becoming possessory upon the termination
	of the life estate, and cannot cut the life estate short. It is a remainder
	to a class, B's children, in fee simple. It is a contingent remainder 
	because it is subject to the express condition precedent, "and if B
	does not survive A." If the words of an instrument are classified
	in sequence, as in this example, the classification of remainder
	is not too difficult a task.

	Why is it important to distinguish between vested and contingent
	remainders? Because the common law drew -- and still draws -- a sharp 	distinction. Vested remainders were favored and contingent remainders 	disfavored.  The judges thought contingent remainders were objectionable 	because they made land inalienable. Therefore, they laid down several rules 	designed to curtail contingent remainders: (i) the Doctrine of Destructibility by 	Merger; (ii) the Rule in Shelley's Case; (iii) the Doctrine of Worthier Title; and 	(iv) the Rule Against Perpetuities.  In addition, contingent remainders were not 	alienable, whereas vested remainders were. Thus several legal consequences 		turn upon whether a remainder is vested or contingent. 

	K. Summary of Future Interests -- See p. 122-25 in Gilbert's

Concurrent Ownership

I. Concurrent Ownership: Tenancy in Common, Joint Tenancy, and Tenancy by Entirety

	A. The preceding section of the outline dealt with successive ownership (i.e. a 	life estate in A, followed by a remainder in B). Property can also be owned by two 	or more persons concurrently.  For example, A and B can be concurrent owners 	of a possessory fee simple, a life estate, or even a remainder. There are three types 	forms of concurrent ownership with distinguishing features:

		1. A tenancy in common -- two or more persons own 
		undivided shares in the property, with no right of survivorship 				between them. This means that when one tenant in common 				dies, his interest will pass to his heirs or devisees.  Each person 				can sell or convey away his own interest, without the consent of 				the other person(s). The interests can be different -- one tenant
		might own an undivided, one-fourth, another an undivided
		three-fourths.

		2. A joint tenancy -- Here, two or more persons own with a right of 
		survivorship.  Thus, when one joint tenant dies, the survivor(s)
		takes all.  A joint tenancy can be created in real or personal
		property.  Remember that the common law required four
		unities (time, title, interest and possession) for a joint tenancy.
		The survivorship provision can be destroyed by severance
		of the joint tenancy, which automatically transforms it into
		tenancy in common. This occurs if one joint tenant transfers
		away his interest in the estate, either voluntarily (i.e., giving it
		to his heirs) or involuntarily (i.e., by execution by his creditors).

		3. A tenancy by entirety -- exists only between husband and
		wife, with a right of survivorship that cannot be severed	
		without the consent of both spouses. 

	NOTE:  Smith began his lecture on concurrent ownership by
	immediately pointing out that he was in no way responsible for
	writing the discussion of concurrent ownership in our casebook. 
	He says it is very poorly written, making rather simple concepts
	much more difficult than they really are.

	B. A tenancy in common is a form of concurrent ownership wherein
	each co-tenant is the owner of a separate and distinct share of the
	property, which has not been divided among the co-tenants. Each 
	owner has a separate undivided interest in the whole.  Tenancies in
	common can arise by an express conveyance or devise to persons as
	tenants in common or when persons inherit property from a
	decedent.  Today, a grant only from A to B creates a tenancy in common, unless 	specific language in the instrument makes it a joint tenancy (on this specific 		point, see "joint tenancy" below).

		1. Each tenant in common has the right to possess and enjoy the
		entire property, subject to the same right in each co-tenant. One
		co-tenant can go into possession of the whole unless another
		co-tenant objects. 

		EX: O dies, leaving a son S and a daughter D as her heirs. D has
		the right to, and does, move into the house.  Unless S objects,
		there is no problem with respect to the right of possession.

		2. When a tenant in common dies, his interest passes to his 
		devisees or heirs. It does not go to the surviving tenant in
		common. Unlike a joint tenancy or a tenancy by the entirety,				a tenancy in common does not have a right of survivorship.

		3. Equal shares are not necessary for a tenancy in common.
		A and B can be tenants in common, with A holding a
		four-fifths interest and B holding a one-fifth interest. It is
		presumed that the shares of tenants in common are equal,
		but this presumption can be overcome by evidence that
		unequal shares were intended.
		
		EX: A and B, who are not related to each other, purchase 
		property as tenants in common. If A puts up three-quarters of	
		the purchase price and B one-quarter, it will likely be held
		that A did not intend to make a gift to B, and that the parties
		have undivided interests proportionate to the amount each
		paid. 

		 4, Tenants in common can have different types of estates. 
		Suppose that A and B are tenants in common, and that A dies, 
		devising his half-interest to C for life, remainder to D.  C now
		owns a life estate and D a remainder in a one-half interest held 
		in a tenancy in common with B.

		5. A tenant in common can sell, give, devise or otherwise
		dispose of his undivided share in the same manner as if he
		were the sole owner of the property. In other words, a tenant
		in common can do as he wishes with his property without the 				consent of the other tenants. 

		EX: A and B are tenants in common. Subsequently A conveys
		his one-half interest to C, D, and E as tenants in common.
		Thereafter B, C, D and E are tenants in common, B owning
		a one-half undivided interest and C, D, and E each owning
		a one-sixth undivided interest.

		6. In a tenancy in common, a creditor can only reach the interest
		of the tenant with the bad credit.

		7. If a husband and wife have a tenancy in common and
		get a divorce wherein each one contests the other's
		property interest, then a judge decides how to split the
		property interest.
  
		8. Under modern law, whenever a conveyance is made to two
		or more persons who are not husband and wife, they are
		presumed to take as tenants in common and not as joint 
		tenants, unless there is evidence that a joint tenancy is intended.

	C. A joint tenancy is a form of concurrent ownership wherein each co-
	tenant owns an undivided share of property (as in a tenancy in common), and the 		surviving co-tenant(s) has the right to the whole estate. The right of survivorship 	is the distinctive feature of the joint tenancy. There is no limit on the number of 	persons who can hold together as joint tenants. On the death of each joint tenant, 	the property belongs to the surviving joint tenants, until only one is left.  The 	tenant(s) who lives longest takes the property by himself.

		1. A joint tenancy can be created by the deed or by will, or by
		a joint adverse possession. Joint tenancy does not arise where
		persons inherit property by intestate succession. Heirs always
		take as tenants in common. The presumption today is that
		a conveyance to two or more persons creates a tenancy in
		common, but there are exceptions.

			a. In some states, a husband and wife are presumed to
			take as joint tenants or tenants by the entirety.

			b. Executors and trustees are presumed to hold as
			joint tenants. Thus, upon the death of one fiduciary,
			the surviving fiduciary continues to manage the estate
			or the property, since it would be very inconvenient to
			have the heirs of the dead fiduciary come in and claim
			to be co-executors or co-trustees.

		2. A joint tenancy can be created in either real or personal
		property. 

		3. Since the joint tenants are regarded, by a common law fiction,
		as composing one entity, the common law requires their
		interests be equal in all respects. They must take their 
		interests:
			
			(i) at the same time
			(ii) by the same instrument,
	 		(iii) with identical interests, AND
			(iv) with an equal right to possess the whole property. These four 				unities are commonly known as time, title, interest and 					possession.
		
		When a grantor failed to create a tenancy because one of these 				four entities was not present, a tenancy in common was created. 

			a. Unity of time - The interest of each joint tenant must
			vest at the same time. For example, O conveys "to A for
			life, then to the heirs of A and the heirs of B as joint
			tenants." The heirs of A are ascertained at A's death,
			and the heirs of B are ascertained at B's death. Since the
			holders of the remainder are ascertained at different
			times, the heirs of A cannot take as joint tenants with 
			the heirs of B. Since a unity does not exist, they take as
			tenants in common.

			b. Unity of title - All joint tenants must acquire title by
			the same deed or will, or by a joint adverse possession.
			The unity of title requirement prevents conveyances
			by a sole owner to himself and another as joint 
			tenants (i.e., in a conveyance by a husband to himself and 
			his wife as joint tenants). 

			EX: A conveyance by H to "H and W as joint tenants,"
			violates the unities of time and title. Because of the 
			common law rule that one person cannot convey to
			himself, the conveyance by H to "H and W as joint
			tenants" is viewed as in reality only a conveyance of
			a half-interest by H to W. Since the unities of time
			and title are lacking, at common law H and W held as 
			tenants in common.

			But the exception to this example is the strawperson
			(a strawperson is a person not intended to have any 
			beneficial interest in the property, who must convey as
			directed by the beneficially interested parties. A 
			strawperson is usually a lawyer or the lawyer's secretary.)
			Thus, where H wants to convey "to H and W as joint 					tenants," he can accomplish his wishes by conveying
			the property to a "strawperson." After H conveys to the
			strawperson, the strawperson conveys to "H and W as
			joint tenants." The second deed complies with the four
			unities rule.

		3. Unity of interest - Since in theory joint tenants hold
		but one estate as a single entity, the interest of each joint
		tenant must be equal in an estate of one duration. It
		is not possible, for example, for O to create a joint tenancy
		by conveying "one-half to A and his heirs, and one-half
		to B for life, A and B to hold as joint tenants." A and B
		would hold as tenants in common, which does not
		require unity of interest.

			a. To create a joint tenancy, the shares of 
			each joint tenant must be equal. One joint tenant 						cannot be given a one-third share and the other
			a two-thirds share at the time of the creations
			of the joint tenancy. However, after the
			joint tenancy is created, any joint tenant can 
			petition a court to terminate the joint tenancy						by partition sale. Upon the sale of the property,
			the court may divide the sale proceeds in
			accordance with the proportionate considerations
			paid.

			b. Property can be divided into fractional shares,
			one of which is owned by persons as joint tenants
			and the other owned by persons as tenants in 
			common.
	
			EX: O conveys Blackacre as follows: "a one-half
			undivided interest to H and W as joint tenants,
			and a one-half interest to A." As between 
			themselves, H and W are joint tenants, and if 
			H dies first, W will own the entire one-half 
			interest relieved of H's participation. As 							between H and W on the one and A on the other,
			the parties are tenants in common. There are
			no survivorship rights between A and the joint
			tenants H and W.

		5. Unity of possession - Unity of possession requires that
		each joint tenant have the right to possession of the
		whole. After a joint tenancy is created, the joint tenants
		can agree that one joint tenant has the exclusive right
		of possession. Such an agreement does not break the
		unity of possession; the joint tenant out of possession
		is merely waiving his right to possession.
				
		NOTE: Smith says that two of the unities--time and title--
		are not very important today. But he explains that states do 		
		generally require the other two unities--interest and possession--to
		exist in order for there to be a joint tenancy. In some states,
		a joint tenancy can be created "if the grantor intends it"--a
		position that may lessen the importance of the four unities
		requirement.

		6. A joint tenancy can be created only by express words in an
		instrument indicating an intent to create a joint tenancy. The
		clearest way to create a joint tenancy is to convey "to A and B as
		joint tenants with the right of survivorship, and not as tenants
		in common." These words will create a joint tenancy, but 
		anything else--such as "to A and B as joint tenants" or "to A and
		B jointly"--might not create a joint tenancy. In some states, a 
		joint tenancy can be created only if survivorship is expressly
		provided for. 

		NOTE: Smith says a well-drawn up deed with a joint tenancy 
		should explicitly include the right of survivorship, such as:
		"to A and B as joint tenants with the right of survivorship, and 				not as tenants in common."

		7. The joint tenancy is a useful estate, particularly since it avoids
		probate. When a person dies either intestate or testate, probate
		proceedings have to be opened in a local court in order to, 
		among other things, change the title from the decedent to the
		new owner. Probate is expensive and time-consuming. With a 				joint tenancy, there is no need to change title at a joint tenant's 				death, since the surviving joint tenant owns the whole by virtue 				of the right of survivorship. 

		8. Any joint tenant can at any time destroy the right of 
		survivorship by severing the joint tenancy. Upon severance,
		the joint tenancy becomes a tenancy in common, and the
		right of survivorship is destroyed. Modern law generally
		follows the old common law view that severance of one of the
		four unities severs the joint tenancy. There are other ways to
		sever the joint tenancy:

			a. Each joint tenant has the right to convey his interest.
			A conveyance of the tenant's entire interest or share
			severs the joint tenancy with respect to that share. 
			Either a conveyance to a third person or to another
			joint tenant severs the share conveyed from the joint
			tenancy. 

			EX: A, B and C are joint tenants. On his death bed, A 
			conveys his share to D, thus destroying the unities
			of time and title between B and C and their new co-
			tenant, D. B and C remain joint tenants between 
			themselves, but D holds his share as a tenant in 
			common with them. When B subsequently dies,
			C attains B's interest through right of survivorship.
			C will then own a two-third interest and D a one-third
			interest as tenants in common.

			NOTE: Smith says that the ease of conveying away a
			share in a joint tenancy illustrates just how easily
			a joint tenancy can be severed. 

			b. Smith says that a partition can destroy a joint 
			tenancy.

			c. Smith explains that under old common law
			 a joint tenant who wished to convert the 
			tenancy to a tenancy in common had to 
			convey to a strawperson, who conveyed back to the
			joint tenant. The common law required that, in order
			to have a legal transfer, one person must convey to
			another person, and not to himself; hence the joint
			tenant could not convey directly to himself, or the
			joint tenancy would be destroyed. See above on how
			the joint tenant nowadays can successfully transfer an 					interest to himself through a straw person.

	D. A tenancy by entirety is a form of concurrent ownership that can
	be created only between husband and wife, holding as one person.
	The tenancy by the entirety is like the joint tenancy in that the
	four unities (plus a fifth--the unity of marriage) are required for
	its creation, and the surviving spouse has the right of survivorship.

		1. It is of the essence of tenancy by the entirety that husband
		and wife are considered in law to be one person. The fiction
		that husband and wife are one person reflected the realities
		of English common law, where a married woman was not
		a legal person and her husband controlled her interests.
		This peculiar legal fiction of unity of husband and wife still
		underlies the tenancy by the entirety and causes trouble.

		2. Although the tenancy by the entirety resembles the joint
		tenancy in that the same four unities are required for its
		creation, it is unlike the joint tenancy in that severance of
		the tenancy by one tenant is not possible. Neither tenant
		acting alone can sever the four unities and destroy the right
		of survivorship. This is the chief difference between a 
		tenancy by entirety and a joint tenancy.

		3. Modern law permits husband and wife to take as tenants in
		common or as joint tenants. Where the conveyance is unclear,
		most states that retain the tenancy by the entirety presume a 
		conveyance to husband and wife creates a tenancy by entirety. 
		In some states, when the conveyance is ambiguous, husband and 				wife take as tenants in common, while in other states, they take 				as joint tenants.

		4. In the nineteenth century, each state passed the Married 
		Women's Property Act, which removed the common law 					disability of married women to control and dispose of their 					property. This Act provided, generally, that a married woman 				was able to receive, hold, manage, and dispose of real and 					personal property as if she were a single woman.

		5. Like a joint tenancy, a tenancy by entirety can be created in 				either real or personal property. 
	
		6. The courts in the majority of states hold that creditors of
		one spouse cannot reach the property because neither the 
		husband nor the wife acting along can transfer his interest.
		Smith points out that creditors have tried to abolish the
		tenancy by entirety for this reason, while debtor protection
		groups have tried to preserve it.

		7. In most states, a divorce terminates the unity of husband
		and wife and therefore the tenancy by the entirety. In some
		states, the tenancy by the entirety is converted into a joint
		tenancy, but in most it is converted into a tenancy in common
		on the theory that the spouses do not want survivorship 
		rights after divorce.

Marital Property

I. Community Property: Eight states, including Texas and California, have community property between married couples. The system of community property (CP) is traceable to French and Spanish influence in the South and West. The summary below sketches the general idea of community property. Many variations exist in each of the eight states.

	1. Basic theory of community property: Community property was the
	civil law marital estate. CP rests upon a notion that husband and wife are a
	marital partnership (a “community”), that both contribute to the material
	success of the marriage, and that both should share equally in material
	acquisitions. CP is owned in equal undivided shares by the spouses.
	One spouse cannot, without the other’s consent, change community
	property into separate property.

	2. What is community property: CP consists of earnings of either spouse
	during marriage and property acquired through earnings. Property owned
	by either spouse before marriage or acquired after marriage by gift, descent,
	or devise is separate property. This decision of property follows the basic
	theory that husband and wife should share equally material acquisitions resulting
	from the labor of either during marriage. Upon death or divorce, all property
	is in community (see below).

	EX: A and B marry December 20, 1995. Before this marriage date, the 
	property A has earned is his own, and the same goes for B. But after A and
	B marry, any property earned during their marriage is shared. 

	But beware: any property owned by A and B before marriage that is brought into 	the marriage might be considered CP. For example, if A inherits $20,000 and
	then marries B, he will have a “hell of a time” proving to a court what part of his 
	property (i.e. $20,000) was acquired before marriage and what was acquired
	during marriage.
 
		a. Income from CP: Once property is characterized as community
		property, all income and proceeds of sale of the property are
		community property. This is what Hamilton calls “the correct theory,”
		based on Spanish as opposed to French law, in CP.

		EX: H earns $1,000 from his job at GE. H uses the $1,000 to buy ten’
		shares of Beta stock in his own name. The Beta stock is CP, even
		though held in H’s own name. H cannot change this stock to separate
		property without W’s consent. Thus, title in CP is not necessarily
		controlling (that is, it does not indicate who owns the property).

		b. Income from separate property: In Texas and some other
		states, the income from separate property is community property
		(this is what Smith calls “the correct theory,” for lack of a better term);
		in other states, like California, it retains its separate character.
				
		EX: In Texas, under “the correct theory,” what if H bought the stock 			before he got married, but still owned the property when he married? If he 			could show a court that he did indeed own the stock before he got married, 		then he will be the owner of the property and it will not be considered CP. 			But the income from the stock, after the marriage, will be community
		property. 

	3. Commingling of Community and Separate Property: If community and
	separate property have been commingled in such a manner that it is impossible
	to ascertain and identify each source, the commingled whole will be presumed
	to be community property.
		
	EX: H and W maintain a bank account in which they deposit both earnings and
	income received from separate property. If no records are kept as  to which
	deposits are separate property and which community, the commingled whole will
	be treated as community. The same result occurs when H and W buy a parcel
	of land using both separate and community funds to pay for it and they keep
	no records.

	4. Conveyance of Share: Neither spouse acting alone can convey his or her
	share of CP, except to the other spouse. However, by agreement of the parties,
	CP may be converted into the separate property of either spouse, or conversely,
	separate property may be converted in CP.

	5. Management of CP: Each husband or wife, acting alone, can manage CP;
	either can sell it, lease it, invest it, etc. Thus, technically, H has the right to
	manage W’s earnings as well as his own, and W has the right to manage	
	H’s earnings as well as her own. Each must use good faith in exercising
	authority and each may be held liable by the other spouse for breach of
	fiduciary duty. However, real property is an important exception to this rule.

	EX: H and W own 100 shares of GM stock as CP. W decides the stock should
	be sold, and she sells it for its market price. She reinvests the proceeds in GE
	stock. Sale and reinvestment is within W’s power.

		a. Real property: Usually, land held as CP cannot be sold except with
		the consent of both husband and wife.

	6. Rights at Dissolution of Marriage: When a marriage dissolves, either by
	death or divorce, then all property is in community. Death and divorce each
	has its own ramifications:

		a. Marriage dissolved by divorce: When the marriage is dissolved by
		divorce, CP is usually divided equally.

		b. Death of a spouse: When the marriage is terminated by the death of
		one spouse, the decedent spouse has the right to transfer his or her 
		one-half interest of CP by will to anyone. 	

	EX: Marguerite (M) and Valery (V) want to co-own property with a right of
	survivorship, but because they are lesbian lovers, they cannot use the system
	of community property, since it only applies to traditional (or heterosexual)
	marriages. What types of common law remedies are available to them for
	this dilemma.
	
	V and M can clearly use the joint tenancy, which almost  seems designed for this 	situation. Two mildly tricky things to remember about a joint tenancy: there is a 	presumption against its creation and, in a few states (unless they’re buying 	property together), there’s the problem of the “four unities.” The drawback is that, 	if M puts in substantially more money than V, then once the joint tenancy breaks 	up, the property is split 50/50 and M loses money on the property.

	Can Valery sell property in a join tenancy if there is a right of survivorship? Yes, 	she does not need Marguerite’s permission to partition her interest and sell it. Can 	there be a joint tenancy be set up where the property cannot be partitioned? Yes, 	there can be a non-partition agreement, which is legally valid only if it is for a 	“reasonable time” (this “reasonable time” requirement is influenced by the RAP). 	Courts generally don’t like non-partition agreements. They’ll recognize their 	validity, but only begrudgingly, unless there is an agreement for a business deal. 

	Can you set up agreement to maintain survivorship and no partition, without using 	a joint tenancy? Setting up a trust may ultimately be the best solution. Also, one 	could establish a joint life estate in M and V, contingent remainder to the 		survivor.  In the case of simultaneous death, property is split 50/50 between heirs.     

In some respects, the most perfect device for M and V is the trust. The problem with the trust, though, is money. The other problem is the discretion exercised by trustee (i.e. if in a relationship M and V cannot get along, will trustee make a good 	decision on how to divide property). 

II. Rights and Obligations of Fair Housing Act (FHA)

	 A.  The purpose of the Fair Housing Act (FHA) is to prevent leasors from
	discriminating against certain groups of people.  FHA controls the owner’s 	right to exclude, since it dictates to him whom he can and cannot rent to (in
	this sense, it disagrees with Posner and Bentham, who say that exclusivity should 	be a central characteristic of an owner’s possession).  	

	B. Two observations about the FHA:

		1. It creates a policy of free access to housing; and it is

		2. A legal document to enforce this policy. “It is a legal mechanism
		to vindicate policy established by act.”

	C. Many people have the misconception that the FHA applies to all groups of
	people (i.e. law students, short people, well-hung guys, etc.). However, FHA
	applies only to the following seven categories of people:

		1. National origin

		2. Familial status (one or more children, under 18, living with the 
		rental applicant)

		3. Handicapped people

		4. Color

		5. Race

		6. Religion

		7. Gender

	EX:  Maxwell, a freshlaw, looks for an apartment near the law school. Landlord 		tells him that he will not rent to him because law students are very anal and
	always threaten him with lawsuits. Landlord has not violated the FHA because
	law students are not a protected class. However, if Maxwell were Mexican, and
	landlord would not rent to him because of his race, Landlord could be sued for
	violating the FHA.

	D. The FHA does not apply to owner-occupied buildings with no more than
	four rental units (i.e., a duplex).

	E. Under 3604(c) of the FHA, a leasor can be charged with a preference to 
	discriminate.  It is easier to charge someone with preference to discriminate,
	under 3604(c), than it is with discrimination, which would explain why this
	provision is the most commonly used of those in the FHA.

	EX: Landlord asks a prospective tenant, over the phone, what race she is. 
	Although this is not flat out discrimination, the landlord, under 3604(c), can
	be charged preference to discriminate. 

	EX: In New York, a luxury apartment complex ran ads that used only white 
	models.  In one ad, there were seventy-five white men and women. The court
	found that “an ordinary reader would find that the defendant’s ads expressed
	a racial preference.”

	NOTE: The “ordinary reader” test was applied in the New York case.

	F. There are two parts to the FHA:

		1. A lessor cannot express a preference, AND

		2. He cannot discriminate.    

Leasehold Estates

I. A leasehold estate is an estate in real property of a lessee, created by a lease

II. Three types of leasehold estates:  tenancy for years, tenancy at will, and a periodic tenancy

	A. Tenancy for years -- This has a stated, definite maximum duration.  It cannot 		last longer than this specified period, unless it is renewed.  (No notice to terminate 	for lessee is necessary; lessor cannot terminate.)

	B. Tenancy at will

		1. A tenancy for an indefinite, uncertain period of time

		2. Either party can terminate the lease with reasonable warning

		3. Any unclear, ambiguous tenancy defaults to a tenancy at will

		4. There is no right to renewal

	C. Periodic tenancy -- This is a tenancy which is renewed automatically at the end 	of each “period.”

		1. Continues from month to month, or year to year, unless lease is 				terminated by proper notice.  

		2. Proper notice

			a. Common law:  The amount of notice must be the same as the 				period (i.e., for a month tenancy, 30 days is required).  

			b. Modern rule:  By statute, many states require only 30 days 				notice, regardless of the period involved.

		3. Renewal:  The lease automatically renews unless a party gives notice.

Leasehold Estates (or Landlord-Tenant Law)

I. 	Landlord’s Duty to Deliver Possession

A. 	At the beginning of the tenancy, the landlord has the duty of transferring the
legal right to possession to the tenant.  

B. 	Two views of actual possession:

1. 	“English rule” (majority view): The landlord has the duty to 
deliver actual possession, as well as the right to possession, at the beginning of the term.  There should be a period of time between the end of the first lease and the beginning of the second one, so lessor has time to evict any carry-over tenants.  If the tenants do carry-over, then the landlord is in default.  The lessor has many remedies available to him—sure to evict the hold-over and recover damages, or treat the hold-over tenant as tenant for another term with rent payable to the incoming tenant. 

Rationale:  It is more efficient for the landlord to evict because 1) he has
implicitly given the move-in tenant the legal right to possession, and he
should enforce that right, 2) as a result, he is closer at fault for the
hold-over tenant, and 3) he knows of the hold-over’s agreement and is
in a better position to evict the squatter.

2. 	“American rule” (minority view):  The landlord has no duty to
deliver actual possession at the commencement of the term.  The 
lessee is responsible for evicting hold-over tenants, and has the same
available remedies as the landlord under the “English rule.”  

Rationale:  The lessee should evict carry-over tenants because 1) the
lease conveys a leasehold to the tenant, and it is up to him to take
possession of the property AND 2) the landlord should not be held liable
for the tortious act of the hold-over tenant.  
 
NOTE:  The “American rule” is arguably less efficient than the “English
rule.”

II. 	Landlord’s Duty not to Interfere with Tenant’s Quiet Enjoyment

A. 	Covenant of Quiet Enjoyment:  The covenant of quiet enjoyment, if not
expressly provided for in a lease, is always implied.  “Quiet” means secure, not necessarily free from noise or loudness.  This covenant refers to the lessor’s use
and enjoyment of the property.  

B. 	The covenant of quiet enjoyment can be breached by interfering with 
title, and by actual and constructive eviction.

1. Title - The tenant has the legal right to possession, and any
interference with this right to title violates the covenant of quiet enjoyment.

EX:  If A has an apartment lease until January 15, 1996, and lessor leases the same apartment to B beginning on January 1, 1996, then B’s covenant of quiet enjoyment has been violated.  

If A dies before his lease ends—and A lives with B—then A’s lease ends, and B can sue A’s estate for the remainder of the lease.

2. Actual eviction - If the tenant is physically evicted from the leased 
premises, then the tenant can treat the lease as terminated and he has no
obligation to pay further rent.  
 
3. 	Constructive eviction - Where, through the fault of the landlord
(not because of another tenant), there occurs a substantial interference with the tenant’s use and enjoyment of the premises, so that the tenant can no longer enjoy the premises as the parties contemplated, the tenant may terminate the lease, vacate the premises, and be excused from further rent. The lessor must have reasonably known, or should have known, of interference.

EX:  There is no central heat in an Alaskan apartment, and tenants cannot
live there any longer.  Lessor did or did not do something that he should
have reasonably known, or did know, would cause tenants to move out.

EX:  B moves into apartment next door.  There are undergrads that blast their music, and interfere with B’s studying.  There is no constructive eviction, if B leaves, because lessor is not directly responsible for the undergrads’ behavior.

NOTE: In constructive eviction, the lessor interferes with the tenant’s enjoyment of his property, while in actual eviction (i.e. changing locks on the door) the lessor physically excludes the tenant.

a. Constructive eviction must be tied to lessor either because lessor:

(1) caused the problem OR
(2) can control the problem

As a general rule, the landlord is not responsible for one tenant causing annoyance to the other tenant, even though the annoying
conduct would be constructive eviction if done by the landlord 
himself, and even though the landlord can legally control the other tenant’s conduct.

b. 	A tenant cannot claim constructive eviction unless he vacates
the premises. This action terminates the lease and the tenant 
cannot generally seek monetary damages.

c. 	If a tenant claims constructive eviction, does not move out,
and refuses to pay rent, a lessor can:

(1) 	seek back rent
(2) 	try to evict  OR
(3) 	argue that the fact that the tenant has not left is evidence that there is no constructive eviction.
			
d. 	If there is a loud neighbor interfering with the use and
enjoyment of the tenant, the tenant has two options before or after claiming constructive eviction:

(1) 	Look to see if there are lease provisions that prevent
the neighbor from playing loud music OR

(2) 	If there are no such provisions, could make the
difficult argument that there is an implied covenant 
between tenants to act reasonably.

			EX: L leases an apartment to T, and also rents a cocktail lounge
			next door to X.  The lease to X provides that L can terminate
			the lease if the noise disturbs the neighboring tenants.  T
			complains to L of the loud noise of X.  L does nothing.  Since
			L has the legal ability to control the noise of X by terminating
			the lease, the noise is a constructive eviction.  Blackett v. Olanoff

But what if in the lease there is a clause stating that the lessor
			cannot be held liable for negligence of other tenants, and the clause
			is bargained for?  This clause is not suitable to prevent 
			constructive eviction.  A tenant can say, “This is intolerable, the
			landlord is at fault,” and leave.

III.   Lease-as-a-Deed v. Lease-as-a-Contract

A. 	Two views of a lease:

1. 	Lease as deed (minority view):  Traditionally, a lease was viewed as 
deed (or a conveyance) and promises in the lease were independent of the party’s performance. The tenant was entitled to possession of the estate, which he had the duty to maintain.  There was no implied covenant of habitability, but there was a covenant of quiet enjoyment (i.e., good title).  Thus, when the lessor took possession of the estate, he assumed the risks of caring for it.  The landlord only has the right to re-enter and repossess the land upon breach of the covenant by the tenant (usually the covenant to pay rent).  The lease was independent in that T’s (tenant’s) promise to pay rent is not dependent upon the performance of L’s (lessor’s) promise to paint.  T cannot break the lease upon L’s failure to perform, but has to sue for damages.    

EX:  There is a leak in the roof, and lessor will not repair it.  The tenant’s obligation to pay rent in the old common law was independent of this
leak.  He must pay rent, but he can seek damages (value of estate with
no leak in the roof - value without the leak = dams).  

EX:  T agrees to rent all of Blackacre.  Before moving in, L rents a part of that Blackacre to U.  T can claim that his covenant of quiet enjoyment was violated, since the rental of Blakckacre to U interfered with T’s use and enjoyment, and that consequently T should owe no rent.

2. 	Lease as contract (majority view):  The more modern view, which is
established in Brown and Javins (two case names we should know), is that leases are contracts and are mutually dependent. The lease can contain numerous covenants—to pay rent, taxes, or insurance, to repair, and so on.  There is always an implied covenant of habitability (a package of “goods and services.”  The lease is dependent in that if L does not do what L promises to do, T can refuse to do what T promises to do.  Thus, if  L does not deliver habitable premises and maintain them in habitable shape, T can refuse to pay rent.  

EX:  Southall Realty (P) leased premises to Brown (D) despite the fact
that when P moved in there were already a number of code violations (i.e. broken commode, broken railing, etc.) rendering the premises uninhabitable.  D withheld rent because of these conditions, and wanted to void her lease.  P sued to regain possession.  The court ruled that the lease was void, since it was created in violation of the D.C. housing regulations, and that D did not have to pay back rent.  Brown v. Southall Realty Co. (1968)

	EX:  Javins (D) refused to pay his April rent to First National Realty Corp.
(P) 	because of the approximately 1,500 violations of the D.C. housing 
code.  The court held that the housing tenant “seeks a well-known package
of goods and services,” and that modern housing regulations imply into
every lease a warranty of habitability.  If this warranty is breached, then the tenant can suspend paying rent.  The Javins court establishes that:
1) 	there is an implied covenant of habitability (which must be compliant 
with D.C. housing code AND 2) the lease is a contract—promises are dependent upon each other.  
		
a. 	Problems with Javins

(1) 	Standards of habitability are not consistent from city
to city.  Judicial or legislative statements must establish these standards.  AND
(2) 	Some courts say problems with habitability can have
				existed before lessee moved in, while others say that they
				must occur after tenant moves in.

b. 	Posner and Smith on Brown and Javins

(1) 	Posner and the Law and Economics crowd argue that
forcing lessors to follow the implied covenant of 
habitability will raise rent and squeeze poor people, like
Brown, out of the housing market.  A lessor could just
as well covert the apartment into a more profitable use, or 
abandon it, so as to avoid expenses of compliance with housing regs, and poor people would thus suffer.

(2) 	Smith says that a problem with implying a covenant is
that, in many cases, a tenant knew, or should have known,
of the poor housing conditions, and should have bargained
to improve them.  But, as we know, a poor tenant does not
have a lot of bargaining power (i.e., he is not a commercial tenant).

NOTE:  In commercial leases, the courts generally adopt the traditional view of the lease-as-deed.  However, covenants of habitability in a few cases have been
implied when it appears that the commercial tenant bargained for continuing maintenance by the landlord.  Davidow v. Inwood North Professional Corp.
The rationale for the majority view is that: 1) residential tenants are in an inferior bargaining position AND 2) a residential tenant must shoulder the cost of the
housing defect, while a commercial tenant can pass these costs onto the clients.

IV. 	Landlord’s Tortious Liability

A. 	The majority view: Landlord will be liable for any unreasonably 
dangerous conditions—high degree of risk--which he permits to remain on leased property, even after control over it has been relinquished.  The test is whether the landlord acted reasonably under the circumstances.  If a high degree of risk was permitted to exist, then the landlord should be held liable.

EX:  Ross (D) constructed stairs leading up to an apartment which D leased to
her daughter-in-law.  Sargent (P) used the daughter-in-law as a baby sitter.  The
stairs were very steep and the guardrail was insufficient to prevent the child from falling down the stairs.  Court held D liable for negligent construction of the stairway, and rejected D’s argument that she had no standard of care since the stairs were in a common area.  Sargent v. Ross (we did not read this case, but Smith discussed it).  Here, there was a violation of an implied covenant of habitability.

A lessor can be held liable for negligence if he fails to correct a situation within  a reasonable times that creates an unreasonable risk of harm.  There are only four situations where the lessor is held liable:

1. 	Special relationship - the innkeeper/guest and common carrier
situations, where there is a higher standard of care.

2. 	Criminal opportunity - Where there is an opportunity for criminal 
conduct created by lessor’s conduct (i.e., not repairing locks on the door).

3. 	Extreme foreseeability -  Lessor foresees, or should foresee, 
dangerous situations (i.e. very dramatic increase in crime in the apartment parking lot) that result in harming the lessee.  The lessor has the duty to provide, say, security, to avoid these dangerous situations.

4. 	Lessor contracts or voluntarily undertakes a task - Lessor 
voluntarily offers, say, to protect a tenant or put a guard in the parking lot, but fails to do so.

Generally, the risk of harm versus the burden of avoiding the harm (the Learned Hand formula—B=PxL) plays into the court’s decision as to whether lessor should be held liable for negligence. 

B.  The minority view: The lessor should not be held liable for criminal activity, even if it foreseeable, since it is out of lessor’s control and he did not directly case T’s harm (just as a loud neighbor is out of the lessor’s control and is not due to the lessor’s own actions).

EX:  T (P) is sexually assaulted in the parking lot of her apartment complex.   There were previous reports of crimes against property, but not for crimes of sexual assault.  T sues L (D), arguing that he was negligent and violated her covenant of habitability.  She claimed this covenant should extend to protecting her physical safety.  The court held that L was not liable, because he was not  a high foreseeability that T would be sexually assaulted (there was only a high
foreseeability of crimes against property).  Also, court rejected the covenant argument, saying that the covenant only provides safety in the sense that, say, floors or stairs should not be unstable.  Finally, court says that lessor should not be held liable for criminal activity, even if it foreseeable, since it is out of lessor’s control and he did not directly cause T’s harm.  This is the minority view.  
Wall v. Platt

V.  Lessor’s Remedies

A. 	Just as there are two different ways to view leases—as a deed or as a 
contract—there are similarly two ways to view lessor’s remedies.  

1. 	If the lease is viewed as a deed (or conveyance), then the lessor
has the following remedies:

a. Sue periodically for back rent. 

(i).  If lessee refuses to pay rent, lessor can turn him into the creditors.

b. Terminate the lease if the tenant moves out, and allow
the new lessee to move in.  OR

c. Re-let on the account of defaulting tenant, and apply the 
new tenant’s rent as credit to defaulting tenant’s rent: 
This is optional (as opposed to the lease-as-contract, when the lessor has a duty to mitigate damages).  If lessor does re-let, he
acts, at least conceptually, as if the defaulting tenant’s lease is still in existence. Of course, there could be a problem if the defaulting
tenant returns—he could claim trespass.

EX:  T leases an apartment for a year.  Six months into lease, T moves out.  L can attempt to lease premises to someone else, but T could claim that L trespassed since T’s lease was still running.  But L could respond that T’s abandonment implies that T has surrendered and abandoned his lease.

		EX:  After Edwards (D) complained to authorities about housing code
		violations on the property she rented from Habib (P), P gave her a 
		30-day notice to vacate and obtained a judgment for possession of the
property.  The court decided that a landlord cannot evict a tenant in retaliation for a tenant reporting violations, and such a retaliatory
motive constitutes a defense to an action of eviction.  Edwards v. Habib.
Most courts also have held that a lessor cannot increase rent in retaliation.

2. 	If the lease is viewed as a contract, then the lessor:

a. 	Has a duty to mitigate damages as in cases with Ks in general
(see “c” above).

		RATIONALE:  A lessor is like a vendor selling goods.  If lessee
		breaches the contract, then the lessor, like a vendor, has a duty to
		mitigate.

NOTE:  There are many arguments against the view that the lessor has a duty to mitigate damages: 1) it places an undue burden on the lessor and
2) property is “unique,” in that it requires a special person, interested in that particular property, to replace lessee.  Smith does not buy this.

V. 	Land Uses

A.	Nuisance:  A “nuisance” is an unprivileged, unreasonable interference with 
a person’s use and enjoyment of his land.  A “private nuisance” interferes with the private use and enjoyment of one or a number of nearby properties.  A “public nuisance” interferes with a right common to the general public.  The essence of a nuisance is that it is the right thing in the wrong place (i.e., a pig in the parlor instead of on the farm).

NOTE:  Knowing nuisances is very important for zoning/taking situations.

1. 	Basis of nuisance law (Bentham):  The basis for nuisance law is
Jeremy Bentham’s theory of property.  According to Bentham, property
is a legal construct designed to protect the expectations and enjoyment
of the property owner.  The person who is causing the nuisance 
unreasonably interferes with his neighbor’s, or the public’s in general,
expectations and enjoyment.  The remedies for a nuisance are basically
monetary damages (for harm suffered by P) or an injuntion against D.

2. 	Traditionally establishing nuisance :  One must establish the 
following elements:

a. 	Expectation interest and first-in-time:  P bought his property
with certain expectations and so that he could enjoy it (i.e., he bought his house near a beach, so he could hear the ocean, lay out on his deck, etc.).  P was owned the property before the nuisance began (the “first-in-time” rule).

b. 	Nuisance is unreasonable and inappropriate: D’s 
nuisance is unreasonable and inappropriate, and is substantially
interfering with P.  It helps P if he can show either:

(1) 	The nuisance is inappropriate and there is nothing
				like nuisance-causing object in the area.

(2) 	There are zoning regs or statutes on the books that
would prevent such usage of the nuisance-causing object.

c. 	Actual harm:  P suffered actual harm as a result of the 
nuisance.  There was serious discomfort or inconvenience—lack of sleep, high stress, inability to use the house as they had before, offensive odors or noise, etc., are some examples.

3. 	Three other ways to establish nuisance (Boomer,  Schack approach, 
and Law and Economics approaches): Courts can use other ways to approach nuisance:

a. 	Boomer test (AKA  economic proportionality test):  If there 
is a marked disparity shown in economic consequences between the effect of the injunction and the effect of the nuisance, then an injunction should not be granted.  Rather, damages to P for P’s harm should be awarded.  This the most economically efficient test.

NOTE:  The problem with this test is that it is sometimes difficult
to put a monetary value on harm suffered (i.e., increased stress or lost sleep).

b. 	Schack approach (AKA social utility proportionality test):  
Drawing from the State v. Schack approach, the court could lump all of the factors of the nuisance together and determine whether 
the social utility of the particular nuisance-causing object is outweighed by the harm it causes (i.e., a power plant that is erected
near a small, inexpensive house would probably not be nuisance
under this theory).  The court could either not give any remedy
or it could force D to pay for actual harm to P.

c. 	Law and Eco. approach: This approach is becoming 
increasingly used by the courts today.  Suppose that landowner
A has a factory on his land belching smoke into the air, which
flows across to landowner B, who has an amusement park
on his land. The smoke interferes with the patrons’ enjoyment of
the park.  

(1) 	Who is at fault:  Neither A nor B is solely the cause
of the harm.  Both are responsible, because of the conflicting uses A and B make of their respective property.
The economic problem is to avoid the more serious harm,
though other factors, particularly fairness, may be important 
in a judicial determination of the appropriate solution.

(a) Neither party alone causes conflict or is at fault:  The party emitting the smoke is no more the cause of the conflict than the party sensitive to the smoke. The conflict requires the presence of both parties. If the factory has a greater market value than the homes around it, then society values the factory higher; it is worth more to society.

(b) 	Externalities:  An externality is a cost (or
benefit) of any given action that is not taken into
					consideration by the actor in determining the level
					of that activity that is optimal from the actor’s point
					of view.  Economic theory suggests that resources
					will generally be allocated more efficiently if the 
					costs (and benefits) of different actions are 
					internalized, i.e. taken into account by economic
actors in determining the optimal level of their activities. It is economically inefficient for a business to impose a cost of doing business upon others and not internalize it. In the above example, an external cost of the factory, which A imposed on B, is that B’s land is made unsuitable for uses sensitive to smoke. An external cost of B’s use of land as an amusement park is that A’s land is made unsuitable for activities that conflict with an amusement park.  The economic problem in all 
“nuisance” cases is how to maximize the social value of production by putting land to its most valuable use while internalizing costs.

4. 	Defenses to nuisance:  A D can claim numerous defenses:

a. 	Benefits to D of nuisance-causing object are greater than 
injuries to P (this is more of a “Law and Economics” argument),
and thus D should not be liable for damages.

b. 	Benefit to the public at large outweigh P’s harm (i.e., source of
			nuisance was an electrical plant built by P’s house).

c. 	D is willing to pay an amount for P’s harm (i.e., in order to
keep the windmill).

4. 	Sunlight:  Because rights in sunlight are not recognized in American
law under the doctrine of covenants, they are sometimes recognized under
the doctrine of nuisance.  The minority view is that blocking a neighbor’s
solar collectors on his roof can be enjoined as a nuisance.  It helped that P argued that his solar-powered house was good for public policy—it conserved energy—and that D had notice from being able to see the solar panels.  This, though, is the minority view.  The majority view in the U.S. is that there are no rights in sunlight (or for enforcing an injunction to keep a fence or trees low), since most of the time these injunctions prevent economic development—preventing buildings.  If a property owner uses
solar power, then most states have statutes requiring him to fill out and
file various forms and docs.