CHAPTER 45

1

4545

Business Law for a New CenturyBusiness Law for a New Century Click your mouse anywhere on the screen to advance the text in each slide. After the starburst appears, click a blue triangle to move to the next slide or previous slide.

2

4545

Business Law for a New CenturyBusiness Law for a New Century

Quote of the DayQuote of the Day

“It is a comfortable feeling to know that you stand on your own ground.

Land is about the only thing that can’t fly away.”

Anthony Trollope,English author

3

4545


Nature of Real PropertyNature of Real Property The grantor is the conveyor of property;

the grantee is the one receiving it.

Real property includes: • Land• Buildings• Subsurface Rights• Air Rights• Plant Life• Fixtures --an object considered to be a

permanent part of the property.

4

4545


Estates in Real PropertyEstates in Real Property Rights in real estate usage and

ownership vary from unrestricted use and right to sell, to a lesser right of usage, but not the right to transfer it.

The rights that someone can hold are called estates, or interests.

5

4545


Freehold EstatesFreehold Estates The owner of a freehold estate has the

present right to possess the property and to use it in any lawful way.

A fee simple absolute provides the owner with the greatest control.

A fee simple defeasible may terminate upon the occurrence of some event.

A life estate is an estate for the life of some named person.

6

4545


Non-Freehold EstatesNon-Freehold Estates Is actually a lease, where the owner

permits someone to use and possess the property.

7

4545


Concurrent EstatesConcurrent Estates A concurrent estate is when two or

more own property at the same time.• Tenancy in Common – two or more people

own the property, each with the right to convey her interests or to pass it down to her heirs.

• A joint tenancy includes the right of survivorship

All co-tenants have an absolute right to partition (division of property).

8

4545


Types of Estates in MarriageTypes of Estates in Marriage Tenancy by the Entirety – form of

ownership in more than half the states.• The husband and wife each own the entire

property, and they both have a right of survivorship.

Community Property – form of ownership in nine states.• Property brought to the marriage or given to

one spouse may remain individually owned, called separate property.

• Income or assets earned during the marriage is community property, which must be equally shared.

9

4545


Condominiums and Cooperatives

Condominiums and Cooperatives

In a condominium, the owner of the apartment typically has a fee simple absolute in his particular unit.

In a cooperative, the residents generally do not own their particular unit.

10

4545


Future InterestsFuture Interests Interests that can be sold now, but do

not convey possession; this ability to possess may or may not develop later.• Reversion – the coveyor of a life estate in

property regains possession after the life tenant dies.

• Remainder – a named, third person, gains possession of a property after a life tenant dies.

11

4545


Nonpossessory InterestsNonpossessory Interests An easement gives one person the right

to enter land belonging to another and make a limited use of it, without taking anything away.• An easement can be created when the

landowner expressly grants it, when he implies it (such as in granting permission to access an area accessible only by crossing your land), or by necessity (when there is no other way to reach the property.)

12

4545


Easements, (cont’d)Easements, (cont’d) Easement by Prescription

• An easement by prescription happens when someone makes use of someone else’s property openly, without permission and for the number of years determined by local statute. If the owner does not stop the unauthorized use, the user is granted an easement by prescription.

13

4545


Nonpossessory Interests (cont'd)Nonpossessory Interests (cont'd)

A profit gives one person the right to enter land belonging to another and take something away.

A license given the holder temporary permission to enter upon another’s property.

A mortgage is a security interest in real property, given to the institution loaning a buyer the money to buy the real estate.

14

4545


Sale of Real PropertySale of Real Property Seller’s Obligation Concerning Property

• Most states now impose an implied warranty of habitability on a builder who sells a new home.

• The seller of a home must disclose facts that a buyer does not know and cannot readily observe, if they materially affect the property’s value.

15

4545


Closing and DeedsClosing and Deeds A general warranty deed normally

contains the covenants of:• Seisin –the seller owns the property• Right to Convey – the seller has the right to

sell this property• (No) Encumbrances – property is free of

easements, profits, mortgages, etc.• Quiet Enjoyment – no other person can

lawfully claim the property• Warranty – seller agrees to defend the

grantee if a third party makes a claim

16

4545


Adverse PossessionAdverse Possession To gain ownership of land by adverse

possession, the user must prove:• Entry and exclusive possession• Open and notorious possession• A claim adverse to the owner; and• Continuous possession for a statutory

period.

17

4545


Land Use RegulationLand Use Regulation Nuisance Law

• A nuisance is an unprivileged interference with a the use and enjoyment of property.

Zoning• State laws that permit local communities to

regulate building and land use.

Eminent Domain• Eminent domain is the power of the

government to take private property for public use.

18

4545


“Real property is ancient in origin and terminology, but

every bit as potent as it was 1,000 years ago.”

19

4545


Link to the InternetLink to the Internet Clicking on the orange button below will link

you to the website for this book. (You must first have an active link to the internet on this computer.)

Once there, click:• Online Study Guide, then• Your choice of a chapter, then• Practice, then• Internet Applications

You should then see web links related to that chapter.

Click here!

Click above to return to the slide show.

Documents

CHAPTER 45