Property Law Developments

Two court reject impossibility defense to tenant rent obligations under government shutdown orders while one abates rent under the wording of the force majeure clause

When Governor Cuomo ordered most businesses to stop serving the public during the COVID-19 pandemic, some could not generate the income needed to pay rent. Some have argued that the impossibility of earning profits to pay rents should constitute a defense to the contractual obligation to pay rent. Two courts in New York have now rejected that argument, including the federal Southern District and a state supreme court.

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Loan modification agreements unenforceable unless in writing

An appellate court in California has held that the state's statute of frauds require loan modification agreements to be in writing to be enforceable. Reeder v. Specialized Loan Serv., LLC, 2020 WL 4345001 (Cal. Ct. App. 2020). This is an expected application of the statute of frauds but it does not mean that some courts, in other factual settings, might make exceptions if the... Read more about Loan modification agreements unenforceable unless in writing

Marketable title act extinguishes easement by necessity

In a surprising decision, the Vermont Supreme Court held that an easement by necessity must be recorded or it will be lost by operation of the state’s marketable title act. Gray v. Treder, 2018 VT 137, 204 A.3d 1117 (Vt. 2018). The facts of the case were unusual, however, because the easement in this case was not clearly visible by physical evidence of its use. That will...

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Easement by necessity may include right to lay utility lines for necessary services

The Connecticut Supreme Court has held that an easement of access established by necessity, an expansion of that easement for utility lines will be allow so long as it is reasonably necessary for the beneficial enjoyment of the dominant estate and does not unreasonably impair the servient estate owner’s beneficial enjoyment of their property.

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Tax foreclosure constitutes a regulatory taking if the city retains proceeds beyond those necessary to pay off the taxes

The Michigan Supreme Court has condemned the practice of keeping all the proceeds of a tax sale of property (done because of failure to pay property taxes) when the city keeps all the proceeds of the sale, even though those are far more than needed to pay the taxes that were due. Rafaeli, LLC v. Oakland County, 2020 Mich. LEXIS 1219 (Mich. 2020)...

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Bank has standing to foreclose despite inability to produce the note on which the mortgage was based

The New Jersey Supreme Court allowed a bank to foreclose on property without direct evidence that it had the right to foreclose. Ordinarily, the foreclosing entity must produce the note that memorializes the underlying debt. The UCC allows foreclosure when notes have been lost, UCC 3-309, if a “lost note affidavit” is filed with the court. In Investors Bank v. Torres, 2020 WL 3550701 (N.J. July 1, 2020), the homeowner borrowed money from one lender who filed a foreclosure action but...

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Neighbor across the street denied standing to challenge a zoning variance

The Supreme Judicial Court of the Commonwealth of Massachusetts has set a very high bar to obtain standing to object to a building permit. In Murchison v. Zoning Board of Appeals of Sherborn, 2020 WL 4012766 (Mass. 2020), owners across the street from an irregularly shaped lot objected to granting the owner a permit to build on it. The court found no harm that...

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A third case granting a wedding provider a free speech exemption from an antidiscrimination law

For the third time, a court has held that a public accommodations law cannot be enforced against a service provider who objects, for religious reasons, to same sex marriage. Chelsey Nelson Photography, LLC v. Louisville/Jefferson County Metro Gov’t, 2020 U.S. Dist. LEXIS 146246 (W.D. Ky. 2020). The other two times were: Telescope Media Group...

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