CHAPTER 8 SNAPSHOT REVIEW
Property Rights, Estates and Tenancies
Snapshot Review
LAND, REAL ESTATE AND REAL PROPERTY
Real property definition
● air, water, land, and everything affixed to the land
● Constitution guarantees private ownership of real estate; ownership rights not absolute; others may exert claims against one’s property
Real property components
● land: surface, all natural things attached to it, subsurface, and air above the surface; unique aspects: immobile, indestructible, heterogeneous
● real estate: land plus all permanently attached man-made structures, called improvements
REAL VS PERSONAL PROPERTY
Property definitions
● something that is owned by someone and the associated rights of ownership
● the bundle of rights: possession, use, transfer, exclusion, and encumbrance
● property is real or personal, tangible or intangible
Fixtures
● an item may be real or personal property depending on the “attachment” criterion and other circumstances
● real property converted from personal property by attachment to real estate
Differentiation criteria
● intention; adaptation; functionality; relationship of parties; contract provisions
Trade fixtures
● personal property items temporarily attached to real estate in order to conduct business; to be removed at some point
Emblements
● plants or crops considered personal property since human intervention is necessary for planting, harvesting
Factory-built housing
● housing pre-built off-site; includes mobile homes; real or personal depending on attachment to land
Conversion
● transforming real to personal property through severance, or personal to real property through affixing
BASIC PROPERTY RIGHTS
Bundle of rights
● the bundle of rights: possession, use, transfer, exclusion, and encumbrance
Separable rights
● any of the bundle of rights, applied to airspace (air rights), surface (surface rights), and subsurface (subsurface rights)
Water rights
● Doctrine of Prior Appropriation: state controls water usage; grants usage permits; Florida recognizes littoral and riparian rights
● littoral rights: abutting property owners own land to high water mark; may use, but state owns underlying land
● riparian rights: if navigable, abutting property owners own land to water’s edge; may use, but state owns underlying land; if not navigable, owner owns land to midpoint of waterway
● rights can be affected by natural processes that change land: accretion, alluvion, erosion, reliction
INTERESTS AND ESTATES IN LAND
Interests
● an combination of bundle of rights
● estates, encumbrances, police powers
Estates in land
●include right of possession; also called tenancies
●leaseholds: of limited duration
● freeholds: duration is not necessarily limited
FREEHOLD ESTATES
● implies “ownership” in contrast to leasehold
Fee simple estate
●also “fee”; most common form of estate; not limited by one’s lifetime
●fee simple absolute: highest form of ownership interest
● defeasible: can revert to previous owner for violation of conditions
Life estate
●fee estate passes to another upon death of a named party
●remainder: interest of a named party to receive estate after holder’s death
● reversion: interest of previous owner to receive estate after holder’s death
Conventional life estate
●full ownership interest, limited to lifetime of life tenant or another named party
●created by agreements between parties
●ordinary: on death of life tenant, passes to remainderman or previous owner
● pur autre vie: on death of another; passes to remainderman or previous owner
Legal life estate
●automatic creation of estate through operation of law
●designed to protect family survivors
●homestead: rights to one’s principal residence
●laws protect homestead from certain creditors
●dower and curtesy: a life estate interest of a widow(er) in the real property; supplanted by elective share
● elective share: right to claim deceased spouse’s property in lieu of will agreement
WAYS OF HOLDING OWNERSHIP
Tenancy in severalty
● sole ownership of a freehold estate
Co-ownership
● ownership by two or more owners
● tenancy in common: co-tenants enjoy an individually owned, undivided interest; any ownership share possible; no survivorship
● joint tenancy: equal, undivided interest jointly owned, with survivorship; requires four unities to create– time, title, interest, possession; survivorship must be stated in deed
● tenancy by the entireties: equal, undivided interest jointly owned by husband and wife
LEASEHOLD ESTATES
● non-ownership possessory estates of limited duration
Estate for years
● specific, stated duration, per lease
Estate from period-to-period
● lease term renews automatically upon acceptance of monthly or periodic rent
Estate at will
● tenancy for indefinite period subject to rent payment; cancelable with notice
Estate at sufferance
● tenancy against landlord’s will and without an agreement
COOPERATIVES
Interests, rights andobligations
● ownership of shares in owning corporation, plus proprietary lease in a unit; corporation has sole, undivided ownership
Organization and management
● developer forms association; buys property; incorporates; board of directors responsible for maintenance and operation
Cooperative disclosures
● 15-day and 3-day right to cancel with no waiver allowed
● plans and specifications for completing unfinished parcels
CONDOMINIUMS
Airspace and common elements
● freehold ownership of a unit of airspace plus an undivided interest in the common
elements as tenant in common with other owners
Interests and rights
● may be sold, encumbered or foreclosed without affecting other unit owners
Condominium creation
● creation: by developer’s declaration
Organization and management
● owners’ association and board of directors determine management, hires managers
Owner responsibilities
● maintain interior, insure contents, pay common area assessments
Condominium disclosures
● 15-day and 3-day right to cancel with no waiver allowed
● dollar amounts on budget are estimates
● plans and specifications for completing unfinished parcels
● oral representations cannot be relied upon
● provide required materials
TIME SHARES
● a lease or ownership interest in a property for the purpose of periodic use by the
owners or tenants on a scheduled basis
Time-share regulation
● sellers of time-share plans must be real estate licensees unless exempted
● Some time-shares are not subject to Florida time-share laws
Time-share disclosures
● listing agreement disclosures: no guaranteed sell price; broker compensation, services, and rights; term and extension; broker use rights; existing judgments
● resale disclosures: form of ownership; no guaranteed sell price; current year’s assessments; ad valorem tax assessment; terms of closing; exchange program
● sale offered outside of Florida exempt from FL law
● 10-day right to cancel with no waiver allowed
● sales in Florida require licensure; occupying owners exempt; developer employees exempt if not paid on per transaction basis
● Florida timeshares offered outside of state not subject to Florida time-share laws
● out-of-state timeshares offered in Florida are subject to Florida time-share laws
HOMEOWNER’S ASSOCIATIONS
● corporation responsible for operation of community or mobile home park with owner membership
● disclosure summary required
● 3-day right to cancel with no waiver allowed
COMMUNITY DEVELOPMENT DISTRICTS
● special purpose government created to provide urban community development services
● tax and assessment disclosure
