Estates & future interests

Distinguishing between a right of first refusal and a restraint on alienation

The Massachusetts Land Court decided an interesting case interpreting a conveyance that reads like a right of first refusal but can be interpreted as a broader restraint on alienation giving discretion to a nonprofit entity to refuse absolutely to any transfer of the land. Gottlieb v. Girl Scouts of E. Mass., 2016 WL 3523859 (Mass. Land Ct. 2016). The conveyance stated that "...

Read more about Distinguishing between a right of first refusal and a restraint on alienation

Fee simple absolute found despite language of "in trust" and "for the uses, purposes" of the YWCA

In a standard application of traditional estates doctrine, the Massachusetts Appeals Court has found a fee simple absolute despite language in the grant to the YWCA stating that the property was given "in trust, nevertheless, for the uses, purposes and trusts aforesaid." Young Women's Christian Ass'n, Inc. of Boston, Inc. v. Young Women's Christian Ass'n of Philadelphia, Inc., 90 Mass. App. Ct. 1119, 2016 WL 7162737 (Table) (Mass. 2016).

Traditionally any language in a conveyance of a fee...

Read more about Fee simple absolute found despite language of "in trust" and "for the uses, purposes" of the YWCA

Mortgage of joint tenancy interest does not encumber interests of joint tenants who do not join the deal

In Bac Home Loans Servicing, L.P. v. Savankham, 2016 Mass. LCR LEXIS 86 (Mass. Land Ct. 2016), a mother gave a bank a mortgage on her joint tenancy interest in property she shared with her two children. The children did not know about or participate in the transaction. Apparently, the bank thought it was getting a mortgage on the whole property rather than just the joint tenancy interest of one joint tenant and...

Read more about Mortgage of joint tenancy interest does not encumber interests of joint tenants who do not join the deal

Banks that foreclose without legal authority to do so commit the tort of wrongful foreclosure

The California Supreme Court held in Yvanova v.  New Century Mortgage Corp.,, 365 P.3d 845 (Cal. 2016), that a borrower has standing to prove that a nonjudicial foreclosure was wrongful because an assignment by which the foreclosing entity purportedly took a beneficial interest was void, thereby depriving the foreclosing party of any authority to foreclose through a trustee's sale. 

In a follow up case,...

Read more about Banks that foreclose without legal authority to do so commit the tort of wrongful foreclosure

Right of entry held to be compensable under the takings clause

The Texas Supreme Court held that a transfer of land to a city with an option to repurchase if the property were ever used for non-park purposes constituted a fee simple subject to condition subsequent and that the right of entry was a property right for purposes of the takings clause and compensable when then city failed to honor the condition. El Dorado Land Co., L.P. v. City of McKinney, 395 S.W.3d 798 (Tex. 2013). The deed provided that the conveyance was "subject to the requirement and restriction...

Read more about Right of entry held to be compensable under the takings clause

Ambiguous "survivor" reference creates a tenancy in common rather than a joint tenancy

A deed granting an interest to two siblings (Roger & Dana Waid) "or the survivor" was interpreted as created a tenancy in common rather than a joint tenancy. Young v. Waid, 2012 WL 2947590, (W.Va. 2012). Following the death of Roger, Dana would have had a 100 % interest in the property if they held as joint tenants (because of her right of survivorship) but only a 50 % interest (with 50% held by Roger's heir or devisees) if they held as tenants in common. Applying an...

Read more about Ambiguous "survivor" reference creates a tenancy in common rather than a joint tenancy

Homeowners' Association dues lost because the property was taken by eminent domain are held not to be compensable under the takings clause

When a government took 14 units from a homeowners association by eminent domain, the remaining owners lost the dues and assessments that those owners would have contributed to the homeowners association. However, the Fifth Circuit has ruled that those lost assessments represent mere "contractual rights" that are not compensable under the takings clause as lost property rights even though they ran with the land. United States v. 0.073 Acres of Land, — F.3d —, 2013 WL 322242 (5th Cir. 2013). The...

Read more about Homeowners' Association dues lost because the property was taken by eminent domain are held not to be compensable under the takings clause

Possibility of reverter enforced by Tennessee court with award of damages for lost rental income

An appeals court in Tennessee correctly interprets a conveyance which provided that the lot "shall automatically revert to Seller in fee simple" if the buyer did not comply with stated conditions created a fee simple determinable with a possibility of reverter. Lasater v. Hawkins, 2011 WL 4790971 (Tenn. Ct. App. 2011). The court not only enforced the condition, finding title to have automatically reverted to the seller but granted the seller (and possibility of reverter owner) five years of rent that...

Read more about Possibility of reverter enforced by Tennessee court with award of damages for lost rental income

Court rules that designated open space on plat is insufficient to establish an easement absent proof the developer induced buyers to purchase in reliance on promises of open space.

Disagreeing with the ruling of the Massachusetts Supreme Judicial Court in Reagan v. Brissey, 844 N.E.2d 672 (Mass. 2006), an appeals court in New Mexico held that open space designated on a recorded plat is not sufficient to create an easement of access by owners of lots on the map in the absence of evidence the developer made representations to buyers inducing them to buy in reliance on promises those lots would remain open. The mere presence of open space on the map was insufficient to prevent the developer from selling that open space for development purposes. ...

Read more about Court rules that designated open space on plat is insufficient to establish an easement absent proof the developer induced buyers to purchase in reliance on promises of open space.